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The Fund is classified as a diversified open-end investment company under the Investment Company Act.","page_number":21,"box":{"x":69,"y":571,"width":820,"height":11}},{"id":"0c32eadf-581e-40a3-bfc1-dc37b904f0f8","block_type":"box","text":"Total Return Fund:","page_number":21,"box":{"x":103,"y":594,"width":128,"height":9}},{"id":"c41b2d79-235e-4703-84d0-224a406a97c3","block_type":"box","text":"The Total Return Fund typically invests more than 90% of its assets in a diversified por tfolio of","page_number":21,"box":{"x":236,"y":594,"width":673,"height":11}},{"id":"5727ff4e-0242-42e2-8fe6-0f8fa8617c7c","block_type":"box","text":"fixed-income securities such as corporate bonds and notes, mor tgage-backed securities, asset-backed securities,","page_number":21,"box":{"x":68,"y":609,"width":811,"height":11}},{"id":"133c387e-c235-4694-9d69-f714f9ab3efc","block_type":"box","text":"conver tible securities, preferred securities and government obligations. Both U.S. and foreign companies and","page_number":21,"box":{"x":69,"y":624,"width":780,"height":11}},{"id":"1949409b-eee2-4996-b147-1327fe70c411","block_type":"box","text":"governments may issue these securities. Under normal circumstances, the Fund invests at least 80% of its assets in","page_number":21,"box":{"x":68,"y":639,"width":837,"height":12}},{"id":"e6ce08f9-399a-4446-a7b5-11f1c0815ab2","block_type":"box","text":"bonds and invests primarily in investment grade fixed-income securities. For the purposes of this strategy, “bonds”","page_number":21,"box":{"x":69,"y":654,"width":816,"height":12}},{"id":"172d168e-1c69-4fc5-8bb6-31983fc5b6e4","block_type":"box","text":"include the following: obligations issued or guaranteed by the U.S. Government or a foreign government or their","page_number":21,"box":{"x":70,"y":669,"width":792,"height":12}},{"id":"c9380229-e4f8-435b-a6c5-3d4aebaa3d3e","block_type":"box","text":"agencies, instrumentalities or political subdivisions; mor tgage-backed securities, including agency mor tgage pass","page_number":21,"box":{"x":69,"y":685,"width":815,"height":11}},{"id":"e5e96a9c-ace3-47b3-8153-395d1396e7e1","block_type":"box","text":"through securities and commercial mor tgage-backed securities; mor tgage to-be-announced (“TBA”) securities; debt","page_number":21,"box":{"x":68,"y":700,"width":821,"height":11}},{"id":"4fcb57dc-9521-4962-8be0-8cc174a46ff5","block_type":"box","text":"obligations of U.S. or foreign issuers; municipal securities; and asset-backed securities. The Fund may invest in fixed","page_number":21,"box":{"x":69,"y":715,"width":838,"height":11}},{"id":"3fc16f44-7582-45da-b6ac-029be39790f3","block_type":"box","text":"income securities of any duration or maturity. The Fund’s investments in derivatives will be counted toward the Fund’s","page_number":21,"box":{"x":70,"y":730,"width":838,"height":11}},{"id":"ae2986d4-c1b2-4e88-b20c-cd883b90f326","block_type":"box","text":"80% policy to the extent that they provide investment exposure to the securities included within that policy or to one","page_number":21,"box":{"x":69,"y":745,"width":827,"height":11}},{"id":"2355fe4c-de57-4ddd-8902-642aee8d997b","block_type":"box","text":"or more market risk factors associated with such securities.","page_number":21,"box":{"x":69,"y":760,"width":427,"height":9}},{"id":"849febfd-d9bf-42b5-9cda-a69cb9c6979d","block_type":"box","text":"The Total Return Fund may invest up to 30% of its net assets in securities of foreign issuers, of which 20% (as a","page_number":21,"box":{"x":101,"y":783,"width":802,"height":11}},{"id":"dd70813f-d2e1-415a-9260-55c74da576fe","block_type":"box","text":"percentage of the Fund’s net assets) may be in emerging markets issuers. Investments in U.S. dollar-denominated","page_number":21,"box":{"x":70,"y":798,"width":817,"height":11}},{"id":"9e57fac6-80d2-44cf-a8bd-21d047a3d229","block_type":"box","text":"securities of foreign issuers, excluding issuers from emerging markets, are permitted beyond the 30% limit. This","page_number":21,"box":{"x":69,"y":813,"width":801,"height":11}},{"id":"ae298572-ac70-45e4-aafe-de209024bb63","block_type":"box","text":"means that the Fund may invest in such U.S dollar-denominated securities of foreign issuers without limit. The Fund","page_number":21,"box":{"x":69,"y":828,"width":825,"height":12}},{"id":"54c38e3d-4fa6-4b40-9a9b-6f7b4e42e476","block_type":"box","text":"may also invest in derivative securities for hedging purposes or to increase the return on its investments. The Fund","page_number":21,"box":{"x":69,"y":843,"width":820,"height":12}},{"id":"3b55f237-bebc-4373-8563-3058d1617c72","block_type":"box","text":"may also invest in credit-linked notes, credit-linked trust cer tificates, structured notes, or other instruments","page_number":21,"box":{"x":69,"y":858,"width":767,"height":12}},{"id":"7019cd04-75ae-4b80-8ce2-2bff5feb4c2e","block_type":"box","text":"evidencing interests in special purpose vehicles, trusts, or other entities that hold or represent interests in fixed","page_number":21,"box":{"x":69,"y":874,"width":804,"height":11}},{"id":"c6c586d6-4ca6-423f-ac79-21249d7a13cb","block_type":"box","text":"income securities.","page_number":21,"box":{"x":70,"y":889,"width":128,"height":9}},{"id":"ccb39b21-a538-42e4-b84f-ca1a424fdc59","block_type":"box","text":"I-5","page_number":21,"box":{"x":481,"y":943,"width":17,"height":9}},{"id":"8b8b383b-2cc9-4e3c-8c6c-299029b48eb0","block_type":"box","text":"NM1026U-6033063-21/246","page_number":21,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"69a0224c-be95-4169-b57d-61a384e9c19d","block_type":"box","text":"The Fund may invest up to 20% of its net assets in fixed-income securities that are rated below investment grade","page_number":22,"box":{"x":101,"y":45,"width":807,"height":11}},{"id":"8fb04af7-56e1-48d3-abb2-dca94427774d","block_type":"box","text":"by the Nationally Recognized Statistical Rating Organizations (“NRSROs”), including Moody’s Investor Services, Inc.,","page_number":22,"box":{"x":69,"y":60,"width":826,"height":11}},{"id":"305782c6-924e-4360-85ee-0e0b4f2fad7c","block_type":"box","text":"S&P Global Ratings or Fitch Ratings, Inc., or in unrated securities of equivalent credit quality. Split rated bonds will be","page_number":22,"box":{"x":69,"y":75,"width":837,"height":11}},{"id":"d0e263c5-7918-41c2-8ca5-e5a42a284db3","block_type":"box","text":"considered to have the higher credit rating.","page_number":22,"box":{"x":69,"y":90,"width":305,"height":11}},{"id":"0dcd5521-cd2c-4fdc-97e7-964fb3200ba6","block_type":"box","text":"The Total Return Fund may invest up to 15% of its net assets in collateralized debt obligations (“CDOs”), of","page_number":22,"box":{"x":101,"y":113,"width":765,"height":11}},{"id":"5aca3c7e-eb6d-4bef-91bd-d93b826e63e5","block_type":"box","text":"which 10% (as a percentage of the Fund’s net assets) may be in collateralized loan obligations (“CLOs”). CDOs are","page_number":22,"box":{"x":68,"y":128,"width":820,"height":11}},{"id":"b1809fa9-00fc-4f34-9571-10d83f48609e","block_type":"box","text":"types of asset-backed securities. CLOs are ordinarily issued by a trust or other special purpose entity and are","page_number":22,"box":{"x":68,"y":143,"width":781,"height":11}},{"id":"e95b1220-3624-481d-8116-ab621d33ed0d","block_type":"box","text":"typically collateralized by a pool of loans, which may include, among others, domestic and non-U.S. senior secured","page_number":22,"box":{"x":68,"y":158,"width":815,"height":11}},{"id":"95cdd181-2b5b-4e36-a8ce-5c8cd2a3dd97","block_type":"box","text":"loans, senior unsecured loans, and subordinate corporate loans, including loans that may be rated below investment","page_number":22,"box":{"x":70,"y":173,"width":833,"height":11}},{"id":"af6cb63a-5265-4fa1-a032-46bf1e891e34","block_type":"box","text":"grade or equivalent unrated loans, held by such issuer.","page_number":22,"box":{"x":68,"y":188,"width":391,"height":12}},{"id":"b1fad26a-83a5-4a4d-8d14-7c9a284f24dd","block_type":"box","text":"The Fund may enter into to-be-announced (“TBA”) commitments, which are forward agreements for the purchase","page_number":22,"box":{"x":101,"y":211,"width":801,"height":11}},{"id":"c1fbdd6a-340c-463a-bded-4a4e26ea5851","block_type":"box","text":"or sale of mor tgage-backed securities for a fixed price, with payment and delivery on an agreed upon future","page_number":22,"box":{"x":69,"y":226,"width":764,"height":11}},{"id":"f1cf0ca0-353c-477d-b687-f4c3676c920c","block_type":"box","text":"settlement date. When the Fund enters into a TBA commitment for the sale of mor tgage-backed securities for a fixed","page_number":22,"box":{"x":69,"y":241,"width":832,"height":11}},{"id":"9838804b-bf77-4705-bf48-d24492c508b4","block_type":"box","text":"price, with payment and delivery on an agreed upon future settlement date, the Fund may or may not hold the types","page_number":22,"box":{"x":70,"y":256,"width":823,"height":12}},{"id":"508bc4de-1d1c-47bb-92aa-6e9a8972b1df","block_type":"box","text":"of mor tgage-backed securities required to be delivered. The Fund may also enter into mor tgage dollar rolls.","page_number":22,"box":{"x":69,"y":271,"width":762,"height":12}},{"id":"82b829c2-cb61-4471-9c5a-6c17a7e7c34a","block_type":"box","text":"The Fund’s primary vehicle for gaining exposure to the commodities markets is expected to be through","page_number":22,"box":{"x":101,"y":294,"width":731,"height":11}},{"id":"12635271-08e8-444d-b575-3cbcb2904387","block_type":"box","text":"investments in the BlackRock Cayman Master Total Return Por tfolio II, Ltd. (the “Subsidiary”), a wholly owned","page_number":22,"box":{"x":70,"y":309,"width":781,"height":11}},{"id":"6d9427b9-bf34-4d02-8dd2-c6a5f1812061","block_type":"box","text":"subsidiary of the Fund formed in the Cayman Islands, which invests primarily in commodity-related instruments. The","page_number":22,"box":{"x":69,"y":324,"width":826,"height":11}},{"id":"b9bf2d2f-30c8-41ad-8281-f9590129ec51","block_type":"box","text":"Subsidiary may also hold cash and invest in other instruments, including fixed income securities, either as","page_number":22,"box":{"x":69,"y":339,"width":760,"height":12}},{"id":"a60f3c42-e16b-495b-8aad-54153579b527","block_type":"box","text":"investments or to serve as margin or collateral for the Subsidiary’s derivative positions.","page_number":22,"box":{"x":70,"y":355,"width":624,"height":11}},{"id":"82b6eaf6-ef70-48df-9035-4b4db68ce27f","block_type":"box","text":"The Fund may engage in active and frequent trading of por tfolio securities to achieve its primary investment","page_number":22,"box":{"x":101,"y":377,"width":769,"height":12}},{"id":"56cd5c6a-a0fd-417c-8af4-06a0d6bf7602","block_type":"box","text":"strategies.","page_number":22,"box":{"x":69,"y":393,"width":74,"height":11}},{"id":"d6ec7576-59c5-41d6-b88f-ba90d80ed9ee","block_type":"box","text":"Investments in the Subsidiary.","page_number":22,"box":{"x":102,"y":415,"width":214,"height":11}},{"id":"441bd72e-bc60-4631-806a-d883089e91c5","block_type":"box","text":"The Fund may invest up to 25% of its total assets in the shares of its wholly","page_number":22,"box":{"x":323,"y":415,"width":545,"height":11}},{"id":"fd3bd120-140e-4848-8eea-ab0d1dd21ab7","block_type":"box","text":"owned and controlled Subsidiary. Investments in the Subsidiary are expected to provide the Fund with exposure to","page_number":22,"box":{"x":69,"y":430,"width":815,"height":11}},{"id":"eea573d6-b6bb-47c7-8c55-d2f8149976e4","block_type":"box","text":"the commodity markets within the limitations of Subchapter M of the Internal Revenue Code of 1986, as amended,","page_number":22,"box":{"x":68,"y":445,"width":821,"height":11}},{"id":"9e06feed-d99f-4545-b2a9-860a2ccc16b3","block_type":"box","text":"and Internal Revenue Service guidance, as discussed below. The Subsidiary is advised by the Manager. The","page_number":22,"box":{"x":69,"y":460,"width":769,"height":12}},{"id":"49619479-7584-4582-acba-ad1c95a77620","block_type":"box","text":"Subsidiary (unlike the Fund) may invest without limitation in commodity-related instruments. However, the Subsidiary","page_number":22,"box":{"x":69,"y":476,"width":832,"height":11}},{"id":"663c61e1-b42e-4789-aa49-39668f295acf","block_type":"box","text":"is otherwise subject to the same fundamental, non-fundamental and cer tain other investment restrictions as the","page_number":22,"box":{"x":70,"y":491,"width":802,"height":11}},{"id":"97b6c0c8-6089-446c-98c6-c9ba97268952","block_type":"box","text":"Fund, including the timing and method of the valuation of the Subsidiary’s por tfolio investments and shares of the","page_number":22,"box":{"x":70,"y":506,"width":814,"height":11}},{"id":"4a47ffec-6873-4039-9bd4-4427a87fec04","block_type":"box","text":"Subsidiary. The Subsidiary is managed pursuant to compliance policies and procedures that are the same, in all","page_number":22,"box":{"x":69,"y":521,"width":800,"height":11}},{"id":"49054cae-9bf6-483f-b1bf-fd4641895c35","block_type":"box","text":"material respects, as the policies and procedures adopted by the Fund. The Subsidiary is a company organized under","page_number":22,"box":{"x":69,"y":536,"width":838,"height":11}},{"id":"4e20a5a3-dac8-4433-8027-7ad37c216f83","block_type":"box","text":"the laws of the Cayman Islands, and is overseen by its own board of directors, which is comprised of John M.","page_number":22,"box":{"x":68,"y":551,"width":780,"height":11}},{"id":"ebb1be8c-4462-4e2d-aaed-37e91b57ef40","block_type":"box","text":"Perlowski, a Director, President and Chief Executive Officer of the Fund, and Trent Walker, Chief Financial Officer of","page_number":22,"box":{"x":69,"y":566,"width":818,"height":11}},{"id":"4f9b4ba2-b8b8-41dc-bb0e-1122a5672f9d","block_type":"box","text":"the Fund. The Fund is the sole shareholder of the Subsidiary, and shares of the Subsidiary will not be sold or offered","page_number":22,"box":{"x":68,"y":581,"width":835,"height":11}},{"id":"fff4d627-ae7f-4da7-be77-7e799b6d55ab","block_type":"box","text":"to other investors.","page_number":22,"box":{"x":68,"y":597,"width":129,"height":8}},{"id":"59e0e833-ff7b-428e-8d3f-a5a5b13d0598","block_type":"box","text":"The Subsidiary invests primarily in commodity-related instruments. Although the Fund may invest in these","page_number":22,"box":{"x":101,"y":619,"width":751,"height":11}},{"id":"b951f06d-8720-4cf9-bda1-bdcd1c75668a","block_type":"box","text":"commodity-related instruments directly, the Fund will likely gain exposure to these commodity-related instruments","page_number":22,"box":{"x":69,"y":634,"width":808,"height":12}},{"id":"39a79848-16cb-475a-a397-baf58b573914","block_type":"box","text":"indirectly by investing in the Subsidiary. To the extent that BlackRock believes that these commodity-related","page_number":22,"box":{"x":70,"y":649,"width":764,"height":12}},{"id":"ab62de01-d6e8-4612-a7df-e11288b4c9f2","block_type":"box","text":"instruments provide suitable exposure to the commodities market, the Fund’s investment in the Subsidiary will likely","page_number":22,"box":{"x":70,"y":665,"width":831,"height":11}},{"id":"cc0dc172-d285-42aa-a556-a3cead9aa4cf","block_type":"box","text":"increase. The Subsidiary may also hold cash and invest in other instruments, including fixed income securities, either","page_number":22,"box":{"x":70,"y":680,"width":839,"height":11}},{"id":"3a15df43-d20a-4eaf-8c5e-cb9f27a67c9d","block_type":"box","text":"as investments or to serve as margin or collateral for the Subsidiary’s derivative positions.","page_number":22,"box":{"x":69,"y":695,"width":647,"height":11}},{"id":"9a86f2ef-e324-4e9f-a6c3-3294afb8b577","block_type":"box","text":"The Manager manages the assets of the Subsidiary pursuant to a separate investment management agreement","page_number":22,"box":{"x":101,"y":717,"width":800,"height":12}},{"id":"27b5e755-a5de-4a63-bf5e-2c6a9eec6722","block_type":"box","text":"(the “Subsidiary Management Agreement”), but receives no additional compensation for doing so. The Manager has","page_number":22,"box":{"x":69,"y":732,"width":827,"height":12}},{"id":"cfa41e8a-e7de-4c94-aa41-351411b083e0","block_type":"box","text":"entered into sub-advisory agreements with BlackRock International Limited and BlackRock (Singapore) Limited with","page_number":22,"box":{"x":69,"y":748,"width":819,"height":11}},{"id":"09499ba4-96b6-45d7-ab51-ade9c3f1d7cf","block_type":"box","text":"respect to the Subsidiary. BlackRock also provides cer tain administrative services for the Subsidiary, but receives no","page_number":22,"box":{"x":69,"y":763,"width":836,"height":11}},{"id":"c90e9dde-ce35-4f6b-80c0-e3d7be0b1b2e","block_type":"box","text":"additional compensation for doing so. The Subsidiary will also enter into separate contracts for the provision of","page_number":22,"box":{"x":69,"y":778,"width":793,"height":11}},{"id":"e742c252-8810-4c99-84af-0e049b3d919c","block_type":"box","text":"custody, accounting agent and audit services with the same or with affiliates of the same service providers that","page_number":22,"box":{"x":69,"y":793,"width":797,"height":11}},{"id":"95f88289-b67e-44db-98b1-5981ee2755d6","block_type":"box","text":"provide those services to the Fund.","page_number":22,"box":{"x":70,"y":808,"width":249,"height":11}},{"id":"dee9d34c-29d5-4f92-844c-c77a096578fa","block_type":"box","text":"The financial statements of the Subsidiary are consolidated with the Fund’s financial statements in the Fund’s","page_number":22,"box":{"x":101,"y":831,"width":788,"height":11}},{"id":"398deb26-62d4-4e2d-8dc9-ff42744fcb72","block_type":"box","text":"Annual and Semi-Annual Financial Statements and Additional Information. The Fund’s Annual and Semi-Annual","page_number":22,"box":{"x":68,"y":846,"width":785,"height":9}},{"id":"4e7c059f-8ad4-46d5-9e4c-171ff061829d","block_type":"box","text":"Financial Statements and Additional Information are filed with the SEC on Form N-CSR and are provided without","page_number":22,"box":{"x":70,"y":861,"width":793,"height":11}},{"id":"39d5a466-7f47-466a-8175-e15a582eb707","block_type":"box","text":"charge upon request as indicated on the back cover of this prospectus.","page_number":22,"box":{"x":69,"y":876,"width":508,"height":11}},{"id":"333d2b4e-4d77-4c21-aaf1-4b0bb880c24d","block_type":"box","text":"I-6","page_number":22,"box":{"x":481,"y":943,"width":17,"height":9}},{"id":"e4175379-b2c2-4735-9f90-af76b8ef1ace","block_type":"box","text":"NM1026U-6033063-22/246","page_number":22,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"ba067a41-5c3e-494b-94ce-c7720e58b2dd","block_type":"box","text":"The Subsidiary is not registered under the Investment Company Act, and, unless otherwise noted in the Fund’s","page_number":23,"box":{"x":101,"y":45,"width":793,"height":11}},{"id":"7f51ac76-bdf6-4a04-b440-15e9e6e3a2af","block_type":"box","text":"prospectus or this SAI, is not subject to all the investor protections of the Investment Company Act. However, the","page_number":23,"box":{"x":70,"y":60,"width":806,"height":11}},{"id":"0043f3db-bf13-48f0-8547-e80ba2e45779","block_type":"box","text":"Fund wholly owns and controls the Subsidiary, and the Fund and the Subsidiary are both managed by BlackRock,","page_number":23,"box":{"x":70,"y":75,"width":802,"height":11}},{"id":"aba9f75a-6861-4aab-818d-f5210c6a1f28","block_type":"box","text":"making it unlikely that the Subsidiary will take action contrary to the interests of the Fund and its shareholders. The","page_number":23,"box":{"x":69,"y":90,"width":825,"height":11}},{"id":"d427ff3c-5323-49f0-9537-57e079977916","block_type":"box","text":"Fund’s Board of Directors has oversight responsibility for the investment activities of the Fund, including the Fund’s","page_number":23,"box":{"x":70,"y":105,"width":821,"height":11}},{"id":"4bbf9249-cf1a-486b-a27f-aaa3919e9410","block_type":"box","text":"investment in the Subsidiary, and the Fund’s role as sole shareholder of the Subsidiary. As noted above, the","page_number":23,"box":{"x":70,"y":120,"width":773,"height":11}},{"id":"13179b9c-3f72-4ec0-8d06-e019606eaae6","block_type":"box","text":"Subsidiary will be subject to the same investment restrictions and limitations as the Fund.","page_number":23,"box":{"x":69,"y":135,"width":643,"height":11}},{"id":"a8921fd6-78d3-4e4d-b4b2-f6a4d8b75ff7","block_type":"box","text":"The Subsidiary is managed pursuant to compliance policies and procedures that are the same, in all material","page_number":23,"box":{"x":101,"y":158,"width":780,"height":11}},{"id":"90f6a739-0283-486c-a86b-054f4633f0b7","block_type":"box","text":"respects, as the policies and procedures adopted by the Fund. In addition, changes in the laws of the United States","page_number":23,"box":{"x":69,"y":173,"width":826,"height":11}},{"id":"fe06fc1f-880e-4a48-816d-9e1aef021c51","block_type":"box","text":"and/or the Cayman Islands could result in the inability of the Fund, the Fund and/or the Subsidiary to operate as","page_number":23,"box":{"x":69,"y":188,"width":805,"height":11}},{"id":"c552c812-8e34-4d65-b72f-6a3181b2cd08","block_type":"box","text":"described in the Fund’s prospectus and this SAI and could adversely affect the Fund. For example, the Cayman","page_number":23,"box":{"x":69,"y":203,"width":791,"height":12}},{"id":"1efa3b40-05d3-4cc8-8a81-89c8d75653a6","block_type":"box","text":"Islands does not currently impose any income, corporate or capital gains tax, estate duty, inheritance tax, gift tax or","page_number":23,"box":{"x":70,"y":218,"width":824,"height":12}},{"id":"955b125e-5a9c-4751-8cb9-e5ad3cfa5cd0","block_type":"box","text":"withholding tax on the Subsidiary. If Cayman Islands law changes such that the Subsidiary must pay Cayman Islands","page_number":23,"box":{"x":68,"y":234,"width":832,"height":11}},{"id":"34baa54a-37f1-4c62-b0e1-016aaf8023b5","block_type":"box","text":"taxes, Fund shareholders would likely suffer decreased investment returns.","page_number":23,"box":{"x":68,"y":249,"width":537,"height":11}},{"id":"f0f677fd-71a0-43d2-8c59-f7e4f5bb2349","block_type":"box","text":"The Fund, as a “regulated investment company” under the tax rules, is required to realize at least 90 percent of","page_number":23,"box":{"x":101,"y":271,"width":801,"height":12}},{"id":"a2db313c-970e-4adb-b7f8-b17927d3e34e","block_type":"box","text":"its annual gross income from investment-related sources, specifically from dividends, interest, proceeds from","page_number":23,"box":{"x":70,"y":286,"width":779,"height":12}},{"id":"96966bc7-8efa-4c2d-8fee-558bc5d4296a","block_type":"box","text":"securities lending, gains from the sales of stocks, securities and foreign currencies, other income (including, but not","page_number":23,"box":{"x":69,"y":302,"width":831,"height":11}},{"id":"f245b75f-1154-4082-95b0-c36c4837c40b","block_type":"box","text":"limited to, gains from options, futures or forward contracts) derived with respect to its business of investing in such","page_number":23,"box":{"x":70,"y":317,"width":824,"height":11}},{"id":"c41ae20d-fa1e-49ae-9f8d-e08963883189","block_type":"box","text":"stock, securities or currencies, or cer tain types of publicly traded par tnerships (referred to as qualifying income). The","page_number":23,"box":{"x":69,"y":332,"width":835,"height":11}},{"id":"a191e889-0d8e-4110-abf2-7c402433d2c8","block_type":"box","text":"Fund, invests in commodity-related instruments indirectly through the Subsidiary because direct investments by a","page_number":23,"box":{"x":70,"y":347,"width":807,"height":11}},{"id":"d297a7f2-83f7-47c7-9f3f-dda4219e2557","block_type":"box","text":"regulated investment company in commodity-related instruments generally do not, under published IRS rulings,","page_number":23,"box":{"x":69,"y":362,"width":789,"height":11}},{"id":"befa967c-0d67-4935-9aa8-eee1464dbf7f","block_type":"box","text":"produce qualifying income. Based on final regulations on which taxpayers may rely for taxable years beginning after","page_number":23,"box":{"x":70,"y":377,"width":819,"height":12}},{"id":"ad8d1451-4e82-4692-a5e5-3e6939dc9c6f","block_type":"box","text":"September 28, 2016, the Fund expects its income and gain with respect to the Subsidiary to be qualifying income.","page_number":23,"box":{"x":69,"y":392,"width":819,"height":12}},{"id":"a224f1a6-d04a-401b-b24d-927836dffa0f","block_type":"box","text":"However, in the future, if the IRS issues regulations or other guidance, or Congress enacts legislation limiting the","page_number":23,"box":{"x":70,"y":407,"width":805,"height":12}},{"id":"fac18a21-1030-4834-b433-c3fea7b3c001","block_type":"box","text":"circumstances in which the Fund’s income with respect to the Subsidiary will be considered “qualifying income,” the","page_number":23,"box":{"x":69,"y":423,"width":829,"height":11}},{"id":"24f28e6f-1246-424f-96b3-95a843fd9403","block_type":"box","text":"Fund might be required to make changes to its operations, which may reduce the Fund’s ability to gain investment","page_number":23,"box":{"x":70,"y":438,"width":813,"height":11}},{"id":"1d5bd706-038e-4f1a-9998-53197166b9ca","block_type":"box","text":"exposure to commodities. Fund shareholders may also experience adverse tax consequences in such circumstances.","page_number":23,"box":{"x":69,"y":453,"width":836,"height":11}},{"id":"cd288906-4d65-495c-a58f-b12a158f4438","block_type":"box","text":"The Subsidiary will not be subject to U.S. federal income tax. It will, however, be considered a controlled foreign","page_number":23,"box":{"x":101,"y":475,"width":797,"height":12}},{"id":"b52a4b58-478f-4126-a3fb-ad1fc8cac1d4","block_type":"box","text":"corporation, and the Fund will be required to include as income annually amounts earned by the Subsidiary during","page_number":23,"box":{"x":69,"y":491,"width":811,"height":11}},{"id":"5241c38c-3f54-429e-86d2-25156fa51367","block_type":"box","text":"that year, whether or not the Subsidiary distributes such amounts to the Fund. (Previously taxed income will not,","page_number":23,"box":{"x":68,"y":506,"width":800,"height":11}},{"id":"28de748f-10f7-46f9-bdb8-6ba8aefc3dd6","block_type":"box","text":"however, be taxable again when distributed.) Fur thermore, the requirement for the Fund to distribute net investment","page_number":23,"box":{"x":69,"y":521,"width":826,"height":11}},{"id":"7f90fcdc-4197-4cc3-be5f-69547469623d","block_type":"box","text":"income, if any, and net realized capital gain, if any, at least annually, will apply to such Subsidiary income, whether or","page_number":23,"box":{"x":70,"y":536,"width":835,"height":11}},{"id":"a9164915-aa9c-462d-be8f-a166498a6c3e","block_type":"box","text":"not the Subsidiary makes a distribution to the Fund during the taxable year. If the Subsidiary incurs net losses in any","page_number":23,"box":{"x":69,"y":551,"width":834,"height":11}},{"id":"5b22a0d0-5c8b-4dbe-afcd-1f7f1c6aaabe","block_type":"box","text":"year, such losses will not offset the Fund’s income or gains nor carryforward to future years.","page_number":23,"box":{"x":68,"y":566,"width":661,"height":11}},{"id":"0c1b1dca-25c4-498a-84e5-8e3b48e6ce64","block_type":"box","text":"Blocker Subsidiary","page_number":23,"box":{"x":70,"y":597,"width":133,"height":11}},{"id":"51e2c6c1-b224-459e-8e3d-069e483043bf","block_type":"box","text":"The Fund has formed a wholly-owned Delaware subsidiary (the “Blocker Subsidiary”) to hold interests in cer tain","page_number":23,"box":{"x":101,"y":619,"width":796,"height":11}},{"id":"47721b78-fc72-415a-8133-6728d922c2a0","block_type":"box","text":"of its por tfolio companies and continue to meet the qualifications for taxation as a regulated investment company","page_number":23,"box":{"x":69,"y":634,"width":812,"height":12}},{"id":"9b45c296-d36f-48c8-a68b-e19e6d8760a1","block_type":"box","text":"(“RIC”) under the Internal Revenue Code. The Blocker Subsidiary will qualify for the exclusion from the definition of","page_number":23,"box":{"x":69,"y":649,"width":818,"height":12}},{"id":"bcca5258-4d85-43ed-ba85-c3d60bb12a18","block_type":"box","text":"the term investment company pursuant to Section 3(c)(7) of the Investment Company Act or will otherwise not be","page_number":23,"box":{"x":68,"y":664,"width":808,"height":12}},{"id":"6149cb34-f487-4690-aa0a-432bda3d4c51","block_type":"box","text":"required to register as an investment company under the Investment Company Act. Entities such as the Blocker","page_number":23,"box":{"x":69,"y":680,"width":796,"height":11}},{"id":"88c823df-5778-494c-82fc-1ed205c152bf","block_type":"box","text":"Subsidiary are typically organized as corporations or as limited liability companies or par tnerships that elect to be","page_number":23,"box":{"x":69,"y":695,"width":811,"height":11}},{"id":"8404360f-400d-45cb-a002-5d98a14617f6","block_type":"box","text":"taxed as corporations for U.S. federal income tax purposes and hold cer tain investments in pass-through tax entities","page_number":23,"box":{"x":68,"y":710,"width":833,"height":11}},{"id":"5b302bed-df33-4aad-84f0-6cfcf1d2dee4","block_type":"box","text":"(such as par tnership interests or limited liability company interests) the gross revenue from which would be “bad","page_number":23,"box":{"x":69,"y":725,"width":805,"height":11}},{"id":"ba33629e-ed10-40d6-b92b-3ff637724bf5","block_type":"box","text":"income” for purposes of RIC qualification. The Fund may not invest more than 25% of its total assets in the shares of","page_number":23,"box":{"x":70,"y":740,"width":838,"height":11}},{"id":"4571c032-03e4-48ad-b597-09cc07a9a010","block_type":"box","text":"the Blocker Subsidiary. The Blocker Subsidiary will be subject to federal corporation income tax. The Blocker","page_number":23,"box":{"x":68,"y":755,"width":773,"height":11}},{"id":"f6d3ec0d-2e24-4769-bbaa-5b288d977ad0","block_type":"box","text":"Subsidiary’s distributions of its after-tax earnings to the Fund will be “good income” for RIC qualification purposes,","page_number":23,"box":{"x":69,"y":770,"width":816,"height":12}},{"id":"e22e78a1-c453-4dfe-b26d-71c2c44ef2fa","block_type":"box","text":"and will be treated as qualified dividend income (for non-corporate shareholders) and as eligible for the dividends","page_number":23,"box":{"x":69,"y":785,"width":805,"height":12}},{"id":"0b89bbfd-d049-49c2-8d85-00f0fe17662f","block_type":"box","text":"received deduction (for corporate shareholders), or as returns of capital.","page_number":23,"box":{"x":69,"y":801,"width":514,"height":11}},{"id":"6062c907-6874-419c-8f33-6bdd87561528","block_type":"box","text":"Regulation Regarding Derivatives.","page_number":23,"box":{"x":70,"y":831,"width":236,"height":11}},{"id":"8d7fe6a3-616b-4b0b-8c3d-be22b4bec1ac","block_type":"box","text":"The Commodity Futures Trading Commission (“CFTC”) subjects advisers to registered investment companies to","page_number":23,"box":{"x":101,"y":854,"width":792,"height":11}},{"id":"9ec51ee9-2a72-4333-8fe1-df438443908f","block_type":"box","text":"regulation by the CFTC if a fund that is advised by the investment adviser either (i) invests, directly or indirectly, more","page_number":23,"box":{"x":69,"y":869,"width":833,"height":11}},{"id":"62f55206-227f-47b6-981e-c0bc00f8ad93","block_type":"box","text":"than a prescribed level of its liquidation value in CFTC-regulated futures, options and swaps (“CFTC Derivatives”), or","page_number":23,"box":{"x":68,"y":884,"width":826,"height":11}},{"id":"1f727f42-ffcd-4469-9a9a-8faf19eb4376","block_type":"box","text":"(ii) markets itself as providing investment exposure to such instruments. Due to the Fund’s potential use of CFTC","page_number":23,"box":{"x":69,"y":899,"width":807,"height":11}},{"id":"d3a02720-2083-4872-acee-19ed52b11f12","block_type":"box","text":"I-7","page_number":23,"box":{"x":481,"y":943,"width":16,"height":9}},{"id":"9271f967-8dbe-44e5-b14d-91ddb08b9698","block_type":"box","text":"NM1026U-6033063-23/246","page_number":23,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"0d2f409d-4417-4a90-ba88-3c7dc7174a08","block_type":"box","text":"Derivatives above the prescribed levels, however, the Fund will be considered a “commodity pool” under the","page_number":24,"box":{"x":70,"y":45,"width":768,"height":11}},{"id":"b921f54b-5a28-4709-a47e-b85b2160e24d","block_type":"box","text":"Commodity Exchange Act. Accordingly, BlackRock, the Fund’s investment adviser, has registered as a “commodity","page_number":24,"box":{"x":69,"y":60,"width":811,"height":11}},{"id":"7561b912-18f2-4623-bfbe-a5c2b201c900","block_type":"box","text":"pool operator” and is subject to CFTC regulation in respect of the Fund.","page_number":24,"box":{"x":70,"y":75,"width":506,"height":11}},{"id":"2b26bc6e-4ee0-49e4-8294-4bda3cc4cd81","block_type":"box","text":"II. Investment Restrictions","page_number":24,"box":{"x":69,"y":105,"width":194,"height":9}},{"id":"965d8405-afb4-4d12-aab5-dabe27f0abe0","block_type":"box","text":"The Corporation, on behalf of the Fund, has adopted restrictions and policies relating to the investment of the","page_number":24,"box":{"x":101,"y":128,"width":783,"height":11}},{"id":"56ea84da-d6ff-4df6-923a-65ed609451dc","block_type":"box","text":"Fund’s assets and its activities. Cer tain of the restrictions are fundamental policies of the Corporation and may not","page_number":24,"box":{"x":70,"y":143,"width":822,"height":11}},{"id":"581d87d3-13bf-4b9a-9334-0c878cfd09ee","block_type":"box","text":"be changed without the approval of the holders of a majority of the Fund’s outstanding voting securities (which for","page_number":24,"box":{"x":69,"y":158,"width":811,"height":11}},{"id":"299714d5-6fa6-4110-b012-f31e3a4e845f","block_type":"box","text":"this purpose and under the Investment Company Act, means the lesser of (i) 67% of the shares represented at a","page_number":24,"box":{"x":68,"y":173,"width":805,"height":11}},{"id":"9584cd4e-3599-4a4e-ab5b-3cc145b366fa","block_type":"box","text":"meeting at which more than 50% of the outstanding shares are represented or (ii) more than 50% of the outstanding","page_number":24,"box":{"x":69,"y":188,"width":832,"height":12}},{"id":"664f6533-4c71-462c-b05a-73351693dd09","block_type":"box","text":"shares). The Corporation, on behalf of the Fund, has also adopted cer tain non-fundamental investment restrictions,","page_number":24,"box":{"x":69,"y":203,"width":822,"height":11}},{"id":"81359213-e688-4c4e-95e2-5a23a90313b4","block_type":"box","text":"which may be changed by the Board of Directors without shareholder approval. None of the following fundamental and","page_number":24,"box":{"x":68,"y":218,"width":840,"height":12}},{"id":"76636eb3-d2a8-4813-89c5-ffdd67af4226","block_type":"box","text":"non-fundamental investment restrictions shall prevent the Fund from investing all of its assets in shares of another","page_number":24,"box":{"x":69,"y":234,"width":821,"height":11}},{"id":"e36f6b84-1d45-4160-88ca-bb79dc90d576","block_type":"box","text":"registered investment company with the same investment objectives and fundamental policies (in a master/ feeder","page_number":24,"box":{"x":69,"y":249,"width":822,"height":11}},{"id":"217e8141-1dc2-486e-b202-c0e5888a5670","block_type":"box","text":"structure).","page_number":24,"box":{"x":69,"y":264,"width":72,"height":11}},{"id":"f5f468b7-80e1-4fa6-9bd9-c2b8d02758ea","block_type":"box","text":"Set for th below are the Fund’s fundamental and non-fundamental investment restrictions. Unless otherwise","page_number":24,"box":{"x":102,"y":286,"width":767,"height":10}},{"id":"2eaf5912-a50f-4e50-9d5b-e05c70943ca1","block_type":"box","text":"provided, all references below to the assets of the Fund are in terms of current market value.","page_number":24,"box":{"x":70,"y":302,"width":664,"height":11}},{"id":"b837d9a3-4d98-4701-916e-c18b723607e9","block_type":"box","text":"Under the Fund’s fundamental investment restrictions, the Fund may not:","page_number":24,"box":{"x":102,"y":324,"width":520,"height":11}},{"id":"49c62c5f-97a3-4e97-8c98-73628ca0dda2","block_type":"box","text":"1. Concentrate its investments in a par ticular industry, as that term is used in the Investment Company Act.","page_number":24,"box":{"x":135,"y":347,"width":770,"height":11}},{"id":"544e2dd7-342d-4216-9d24-fee9edddceba","block_type":"box","text":"2. Borrow money, except as permitted under the Investment Company Act.","page_number":24,"box":{"x":134,"y":370,"width":529,"height":11}},{"id":"14090c48-77fd-401a-8622-ccaf82945c78","block_type":"box","text":"3. Issue senior securities to the extent such issuance would violate the Investment Company Act.","page_number":24,"box":{"x":134,"y":392,"width":694,"height":12}},{"id":"3421e9d6-f170-44ca-96ce-bc0d7f0e5085","block_type":"box","text":"4. Purchase or hold real estate, except the Fund may purchase and hold securities or other instruments that","page_number":24,"box":{"x":134,"y":415,"width":774,"height":11}},{"id":"9d884aa7-4134-4b5f-9efb-2903712a67c7","block_type":"box","text":"are secured by, or linked to, real estate or interests therein, securities of real estate investment trusts,","page_number":24,"box":{"x":102,"y":430,"width":736,"height":11}},{"id":"bd525eb4-42c0-4524-b977-cb6784206a70","block_type":"box","text":"mor tgage-related securities and securities of issuers engaged in the real estate business, and the Fund may","page_number":24,"box":{"x":102,"y":445,"width":775,"height":12}},{"id":"dea72b92-1a67-4fe5-a0f5-71a1127a3181","block_type":"box","text":"purchase and hold real estate as a result of the ownership of securities or other instruments.","page_number":24,"box":{"x":102,"y":460,"width":666,"height":11}},{"id":"0cc25f8d-31d1-4f13-b7db-83033994f456","block_type":"box","text":"5. Underwrite securities issued by others, except to the extent that the sale of por tfolio securities by the","page_number":24,"box":{"x":134,"y":483,"width":746,"height":11}},{"id":"4c63d3b1-37c1-41f7-899e-2849f217b972","block_type":"box","text":"Fund may be deemed to be an underwriting or as otherwise permitted by applicable law.","page_number":24,"box":{"x":102,"y":498,"width":627,"height":11}},{"id":"cb84e557-069d-447c-82a5-d71779fc34bb","block_type":"box","text":"6. Purchase or sell commodities or commodity contracts, except as permitted by the Investment Company","page_number":24,"box":{"x":134,"y":521,"width":757,"height":11}},{"id":"e943a085-e798-4d67-a5ff-e3c731f86c99","block_type":"box","text":"Act.","page_number":24,"box":{"x":101,"y":536,"width":25,"height":9}},{"id":"fdac21d4-b0d6-48c1-9bc4-9c4686131804","block_type":"box","text":"7. Make loans to the extent prohibited by the Investment Company Act.","page_number":24,"box":{"x":135,"y":559,"width":506,"height":11}},{"id":"adc388e3-5756-4fc7-a1b9-3d3955c26fe5","block_type":"box","text":"8. Make any investment inconsistent with the Fund’s classification as a diversified company under the","page_number":24,"box":{"x":134,"y":581,"width":729,"height":11}},{"id":"9a0934ee-9f2e-4929-9b21-c5f7453e1975","block_type":"box","text":"Investment Company Act.","page_number":24,"box":{"x":102,"y":597,"width":179,"height":11}},{"id":"408ca41e-74ce-43a6-b747-0c2a78428cdb","block_type":"box","text":"Notations Regarding the Fund’s Fundamental Investment Restrictions","page_number":24,"box":{"x":70,"y":627,"width":494,"height":11}},{"id":"e76c64c9-a8ac-4c3b-bfec-5d2e2b19d569","block_type":"box","text":"The following notations are not considered to be par t of the Fund’s fundamental investment restrictions and are","page_number":24,"box":{"x":101,"y":649,"width":799,"height":12}},{"id":"c8d46373-9bfa-44d0-9ad6-c6e490c3a5a0","block_type":"box","text":"subject to change without shareholder approval.","page_number":24,"box":{"x":69,"y":665,"width":341,"height":11}},{"id":"e2b9c908-0c7b-4079-b245-3551c67ac86a","block_type":"box","text":"With respect to the fundamental policy relating to concentration set for th in (1) above, the Investment Company","page_number":24,"box":{"x":101,"y":687,"width":796,"height":11}},{"id":"8726c3eb-d258-4a37-b02e-66bfb5d32e72","block_type":"box","text":"Act does not define what constitutes “concentration” in an industry. The Commission staff has taken the position","page_number":24,"box":{"x":68,"y":702,"width":811,"height":11}},{"id":"eed6d00e-c62a-4967-a5ae-5b970aa0310b","block_type":"box","text":"that investment of 25% or more of a fund’s total assets in one or more issuers conducting their principal activities in","page_number":24,"box":{"x":68,"y":717,"width":833,"height":12}},{"id":"6635a1b1-fbbc-423a-9095-56d35f669ef3","block_type":"box","text":"the same industry or group of industries constitutes concentration. It is possible that interpretations of concentration","page_number":24,"box":{"x":68,"y":732,"width":836,"height":12}},{"id":"d6eeef18-5821-44f5-afba-acc2b271fe5d","block_type":"box","text":"could change in the future. The policy in (1) above will be interpreted to refer to concentration as that term may be","page_number":24,"box":{"x":69,"y":748,"width":815,"height":11}},{"id":"e4d3847c-3c95-4775-831f-8152035511fb","block_type":"box","text":"interpreted from time to time. The policy also will be interpreted to permit investment without limit in the following:","page_number":24,"box":{"x":70,"y":763,"width":813,"height":11}},{"id":"ca290936-aabc-4216-96ca-605b981a5bf8","block_type":"box","text":"securities of the U.S. government and its agencies or instrumentalities; securities of state, territory, possession or","page_number":24,"box":{"x":69,"y":778,"width":820,"height":11}},{"id":"02699b54-807c-440a-8e1a-43c3d2e6e22c","block_type":"box","text":"municipal governments and their authorities, agencies, instrumentalities or political subdivisions; and repurchase","page_number":24,"box":{"x":69,"y":793,"width":809,"height":11}},{"id":"63b279ef-63bb-486f-8880-f39e40e8468a","block_type":"box","text":"agreements collateralized by any such obligations. Accordingly, issuers of the foregoing securities will not be","page_number":24,"box":{"x":69,"y":808,"width":772,"height":11}},{"id":"f9739536-5d2a-4406-a1c7-59df80ea200c","block_type":"box","text":"considered to be members of any industry. There also will be no limit on investment in issuers domiciled in a single","page_number":24,"box":{"x":69,"y":823,"width":824,"height":12}},{"id":"3210f5d6-7a10-443c-aa8c-7c11cdf38086","block_type":"box","text":"jurisdiction or country. Finance companies will be considered to be in the industries of their parents if their activities","page_number":24,"box":{"x":67,"y":838,"width":829,"height":11}},{"id":"4ff213e9-c5a8-455d-957a-d7d5375e640f","block_type":"box","text":"are primarily related to financing the activities of the parents. Each foreign government will be considered to be a","page_number":24,"box":{"x":69,"y":853,"width":805,"height":12}},{"id":"b62b246d-9872-4d35-911a-d3bd1542761f","block_type":"box","text":"member of a separate industry. With respect to the Fund’s industry classifications, the Fund currently utilizes any one","page_number":24,"box":{"x":69,"y":869,"width":840,"height":11}},{"id":"f0ae77aa-d804-44c6-8a17-0f08abfeceac","block_type":"box","text":"or more of the industry sub-classifications used by one or more widely recognized market indexes or rating group","page_number":24,"box":{"x":69,"y":884,"width":803,"height":11}},{"id":"101feca6-820b-430c-b768-3539696c3484","block_type":"box","text":"I-8","page_number":24,"box":{"x":481,"y":943,"width":17,"height":9}},{"id":"29cb41aa-5c24-4d7e-8410-695865cce40f","block_type":"box","text":"NM1026U-6033063-24/246","page_number":24,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"94cbefa9-b664-40fb-bea9-7b6502e162ff","block_type":"box","text":"indexes, and/or as defined by Fund management. The policy also will be interpreted to give broad authority to the","page_number":25,"box":{"x":70,"y":45,"width":807,"height":11}},{"id":"ea6ab927-0e41-432d-9c87-3ca15655192d","block_type":"box","text":"Fund as to how to classify issuers within or among industries.","page_number":25,"box":{"x":70,"y":60,"width":438,"height":11}},{"id":"4dfeafc9-e5bf-4281-8e29-8c33b00f3446","block_type":"box","text":"With respect to the fundamental policy relating to borrowing money set for th above, the Investment Company Act","page_number":25,"box":{"x":101,"y":82,"width":805,"height":12}},{"id":"ed5eb103-4c70-4230-b1a0-2c6550735e64","block_type":"box","text":"permits the Fund to borrow money in amounts of up to one-third of the Fund’s total assets from banks for any","page_number":25,"box":{"x":70,"y":98,"width":782,"height":11}},{"id":"c51542b2-2384-46bc-a40d-6be62fd15e5a","block_type":"box","text":"purpose, and to borrow up to 5% of the Fund’s total assets from banks or other lenders for temporary purposes. (The","page_number":25,"box":{"x":70,"y":113,"width":836,"height":11}},{"id":"a513963d-c175-4127-bec8-fd198ea1b00c","block_type":"box","text":"Fund’s total assets include the amounts being borrowed.) To limit the risks attendant to borrowing, the Investment","page_number":25,"box":{"x":70,"y":128,"width":816,"height":11}},{"id":"a4fa3041-5661-41f6-882f-efb8d14ef2d2","block_type":"box","text":"Company Act requires the Fund to maintain at all times an “asset coverage” of at least 300% of the amount of its","page_number":25,"box":{"x":69,"y":143,"width":812,"height":11}},{"id":"97515951-6713-4871-af0b-a1d95523c871","block_type":"box","text":"borrowings. Asset coverage means the ratio that the value of the Fund’s total assets (including amounts borrowed),","page_number":25,"box":{"x":69,"y":158,"width":824,"height":11}},{"id":"6b16e290-4964-4fb6-a1ba-5f5a27d8d6c7","block_type":"box","text":"minus liabilities other than borrowings, bears to the aggregate amount of all borrowings. Borrowing money to","page_number":25,"box":{"x":69,"y":173,"width":775,"height":11}},{"id":"08a3dc8d-d092-4c0b-b553-509bcdfb8ace","block_type":"box","text":"increase por tfolio holdings is known as “leveraging.” Cer tain trading practices and investments, such as reverse","page_number":25,"box":{"x":70,"y":188,"width":801,"height":12}},{"id":"5b32cce4-7f8c-45e2-87f7-3f44934b4c02","block_type":"box","text":"repurchase agreements, may be considered to be borrowings or involve leverage and thus are subject to the","page_number":25,"box":{"x":69,"y":204,"width":772,"height":11}},{"id":"194d57b0-9af9-47b1-9bce-75a7e56dbe25","block_type":"box","text":"Investment Company Act restrictions. In accordance with Rule 18f-4 under the Investment Company Act, when the","page_number":25,"box":{"x":70,"y":218,"width":810,"height":12}},{"id":"632d6ffb-ef1f-4a12-8279-45ea91c02144","block_type":"box","text":"Fund engages in reverse repurchase agreements and similar financing transactions, the Fund may either (i) maintain","page_number":25,"box":{"x":70,"y":234,"width":828,"height":11}},{"id":"dd9fab88-8c8b-4496-8816-a1dd67970296","block_type":"box","text":"asset coverage of at least 300% with respect to such transactions and any other borrowings in the aggregate, or","page_number":25,"box":{"x":69,"y":249,"width":803,"height":11}},{"id":"bea51e76-00f7-4d2a-8d22-04ae29169997","block_type":"box","text":"(ii) treat such transactions as “derivatives transactions” and comply with Rule 18f-4 with respect to such","page_number":25,"box":{"x":69,"y":264,"width":746,"height":11}},{"id":"d51ffa02-7fd9-4691-bed7-35d3bb70710c","block_type":"box","text":"transactions. Shor t-term credits necessary for the settlement of securities transactions and arrangements with","page_number":25,"box":{"x":68,"y":279,"width":793,"height":11}},{"id":"ec66a2a6-b818-48a3-844c-b5a97256d33a","block_type":"box","text":"respect to securities lending will not be considered to be borrowings under the policy. Practices and investments that","page_number":25,"box":{"x":69,"y":294,"width":835,"height":11}},{"id":"936cbd1b-25e0-404f-a967-967bcb563a0f","block_type":"box","text":"may involve leverage but are not considered to be borrowings are not subject to the policy.","page_number":25,"box":{"x":69,"y":309,"width":643,"height":11}},{"id":"c45e2fdb-ac5d-4054-b1f2-3fefc564ca73","block_type":"box","text":"With respect to the fundamental policy relating to underwriting set for th in (5) above, the Investment Company","page_number":25,"box":{"x":101,"y":332,"width":788,"height":11}},{"id":"f2b1ab3b-ed72-418a-be8d-036e06a9aaae","block_type":"box","text":"Act does not prohibit the Fund from engaging in the underwriting business or from underwriting the securities of other","page_number":25,"box":{"x":68,"y":347,"width":840,"height":11}},{"id":"2e19652d-6605-48a7-8ddd-3f047ff71e0a","block_type":"box","text":"issuers; in fact, in the case of diversified funds, the Investment Company Act permits the Fund to have underwriting","page_number":25,"box":{"x":70,"y":362,"width":825,"height":11}},{"id":"8568a4d9-85cd-4686-af06-cf0d91af963b","block_type":"box","text":"commitments of up to 25% of its assets under cer tain circumstances. Those circumstances currently are that the","page_number":25,"box":{"x":69,"y":377,"width":811,"height":11}},{"id":"cea48041-2ded-459e-8cb8-cb573e2cd06f","block_type":"box","text":"amount of the Fund’s underwriting commitments, when added to the value of the Fund’s investments in issuers","page_number":25,"box":{"x":69,"y":392,"width":796,"height":12}},{"id":"066bbe1c-fc6c-4c7e-a075-76f73b5c9c1a","block_type":"box","text":"where the Fund owns more than 10% of the outstanding voting securities of those issuers, cannot exceed the 25%","page_number":25,"box":{"x":68,"y":407,"width":818,"height":12}},{"id":"9c3904c3-26ce-4c53-88f9-55bb2b08ee46","block_type":"box","text":"cap. A fund engaging in transactions involving the acquisition or disposition of por tfolio securities may be considered","page_number":25,"box":{"x":69,"y":423,"width":833,"height":11}},{"id":"e94d8aa9-bdba-41fd-9d8b-3efd8b9b7f9a","block_type":"box","text":"to be an underwriter under the Securities Act of 1933, as amended (the “Securities Act”). Although it is not believed","page_number":25,"box":{"x":68,"y":438,"width":831,"height":11}},{"id":"f53b34ea-0ec6-46b0-9f05-8de768d4308a","block_type":"box","text":"that the application of the Securities Act provisions described above would cause the Fund to be engaged in the","page_number":25,"box":{"x":68,"y":453,"width":799,"height":11}},{"id":"06ecd66d-fe34-4e89-b1ae-944befe457ad","block_type":"box","text":"business of underwriting, the policy in (5) above will be interpreted not to prevent the Fund from engaging in","page_number":25,"box":{"x":69,"y":468,"width":769,"height":11}},{"id":"86076604-eb38-47c8-8cdd-419d351b132a","block_type":"box","text":"transactions involving the acquisition or disposition of por tfolio securities, regardless of whether the Fund may be","page_number":25,"box":{"x":68,"y":483,"width":811,"height":11}},{"id":"9ca0aadc-bfd5-4741-8bb4-6d367d2e49c7","block_type":"box","text":"considered to be an underwriter under the Securities Act or is otherwise engaged in the underwriting business to the","page_number":25,"box":{"x":69,"y":498,"width":834,"height":11}},{"id":"aefe54ca-3fb1-4733-bec7-0c06f00e1a56","block_type":"box","text":"extent permitted by applicable law.","page_number":25,"box":{"x":69,"y":514,"width":245,"height":10}},{"id":"c0285234-1d2a-4e1e-85e4-1a76a5117196","block_type":"box","text":"With respect to the fundamental policy relating to lending set for th in (7) above, the Investment Company Act","page_number":25,"box":{"x":101,"y":536,"width":778,"height":11}},{"id":"8c19aedb-5af5-4e2e-94b7-a1b1878130a2","block_type":"box","text":"does not prohibit the Fund from making loans (including lending its securities); however, Commission staff","page_number":25,"box":{"x":69,"y":551,"width":759,"height":11}},{"id":"a8f04698-0502-4a9f-8a44-b3aaa6c25d4e","block_type":"box","text":"interpretations currently prohibit funds from lending more than one-third of their total assets (including lending its","page_number":25,"box":{"x":70,"y":566,"width":807,"height":11}},{"id":"a7d6c60d-432b-4101-a8d4-8a7d169c016e","block_type":"box","text":"securities), except through the purchase of debt obligations or the use of repurchase agreements. In addition,","page_number":25,"box":{"x":69,"y":581,"width":784,"height":12}},{"id":"0305bf57-26b9-4e75-8e93-175f400ed70a","block_type":"box","text":"collateral arrangements with respect to options, forward currency and futures transactions and other derivative","page_number":25,"box":{"x":69,"y":596,"width":791,"height":12}},{"id":"ca4d45d4-b2e2-4627-a8ea-cda4f6c6eb26","block_type":"box","text":"instruments (as applicable), as well as delays in the settlement of securities transactions, will not be considered","page_number":25,"box":{"x":70,"y":612,"width":803,"height":11}},{"id":"82fd343c-d97e-486e-9338-fef680b99266","block_type":"box","text":"loans.","page_number":25,"box":{"x":70,"y":627,"width":40,"height":9}},{"id":"eebd17bf-8bef-446b-a577-c2509c9f105f","block_type":"box","text":"The Fund is currently classified as a diversified fund under the Investment Company Act. This means that the","page_number":25,"box":{"x":101,"y":649,"width":777,"height":12}},{"id":"74f85883-5a84-4882-8e5e-cb18a9f92474","block_type":"box","text":"Fund may not purchase securities of an issuer (other than (i) obligations issued or guaranteed by the U.S.","page_number":25,"box":{"x":70,"y":664,"width":751,"height":12}},{"id":"54679d03-8eda-4663-9cfd-6c30ca4fb502","block_type":"box","text":"government, its agencies or instrumentalities and (ii) securities of other investment companies) if, with respect to","page_number":25,"box":{"x":68,"y":680,"width":812,"height":11}},{"id":"77a02566-54ff-4e7c-9480-0e82edfd07ad","block_type":"box","text":"75% of its total assets, (a) more than 5% of the Fund’s total assets would be invested in securities of that issuer or","page_number":25,"box":{"x":69,"y":695,"width":827,"height":11}},{"id":"fbb33a41-bc68-47c9-be4d-5ff3d2caed4a","block_type":"box","text":"(b) the Fund would hold more than 10% of the outstanding voting securities of that issuer. With respect to the","page_number":25,"box":{"x":69,"y":710,"width":781,"height":11}},{"id":"53e3a731-1a4b-4000-88c8-a9262c4c3f24","block_type":"box","text":"remaining 25% of its total assets, the Fund can invest more than 5% of its assets in one issuer. Under the","page_number":25,"box":{"x":69,"y":725,"width":759,"height":11}},{"id":"00d4c8c6-11f4-48bd-9269-a6e1f5ef6b83","block_type":"box","text":"Investment Company Act, the Fund cannot change its classification from diversified to non-diversified without","page_number":25,"box":{"x":70,"y":740,"width":774,"height":11}},{"id":"0aa3284e-7cf4-492f-a40a-64c572736ff4","block_type":"box","text":"shareholder approval.","page_number":25,"box":{"x":69,"y":755,"width":153,"height":11}},{"id":"2c2c8e82-1316-4e66-a5c5-babdca415f27","block_type":"box","text":"Under its non-fundamental investment restrictions, which may be changed by the Board without shareholder","page_number":25,"box":{"x":102,"y":778,"width":768,"height":11}},{"id":"495ec735-890e-4424-81db-5e9607411274","block_type":"box","text":"approval, the Fund may not:","page_number":25,"box":{"x":69,"y":793,"width":197,"height":11}},{"id":"b968cfb3-cd06-4ec6-a2c8-4b4a1d572119","block_type":"box","text":"a. Purchase securities of other investment companies, except to the extent permitted by the Investment","page_number":25,"box":{"x":134,"y":816,"width":742,"height":11}},{"id":"52d78f0b-685e-4323-80c5-351699a17da7","block_type":"box","text":"Company Act. As a matter of policy, however, the Fund will not purchase shares of any registered open-end","page_number":25,"box":{"x":102,"y":831,"width":759,"height":11}},{"id":"747f63b3-d9c0-4d63-8d0c-054974f3d31a","block_type":"box","text":"investment company or registered unit investment trust, in reliance on Section 12(d)(1)(F) or (G) (the “fund of","page_number":25,"box":{"x":102,"y":846,"width":779,"height":11}},{"id":"431baf98-a078-4d92-90f5-e4cf62da4e49","block_type":"box","text":"funds” provisions) of the Investment Company Act, at any time the Fund has knowledge that its shares are","page_number":25,"box":{"x":101,"y":861,"width":761,"height":11}},{"id":"38697b96-13c5-4f36-b6a7-47cab9176398","block_type":"box","text":"purchased by another investment company investor in reliance on the provisions of subparagraph (G) of Section","page_number":25,"box":{"x":102,"y":876,"width":795,"height":11}},{"id":"37d616db-7981-41ec-b950-36022a4af03e","block_type":"box","text":"12(d)(1).","page_number":25,"box":{"x":102,"y":891,"width":60,"height":11}},{"id":"18632b5d-3e7d-4266-900f-460f2bf95bc8","block_type":"box","text":"I-9","page_number":25,"box":{"x":481,"y":943,"width":17,"height":9}},{"id":"dcae6b98-32d3-45d0-840e-e625f97f35ba","block_type":"box","text":"NM1026U-6033063-25/246","page_number":25,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"941d554d-813e-4cec-9189-8619662d29ad","block_type":"box","text":"b. Make shor t sales of securities or maintain a shor t position, except to the extent permitted by the Fund’s","page_number":26,"box":{"x":134,"y":45,"width":765,"height":11}},{"id":"632ecd4e-f245-44bb-82ba-1c7175d7ffc6","block_type":"box","text":"Prospectus and Statement of Additional Information, as amended from time to time, and applicable law.","page_number":26,"box":{"x":102,"y":60,"width":740,"height":11}},{"id":"e6e1ebdc-08a0-46e5-a0fe-8e306086f38e","block_type":"box","text":"Unless otherwise indicated, all limitations under the Fund’s fundamental or non-fundamental investment","page_number":26,"box":{"x":102,"y":82,"width":744,"height":11}},{"id":"5221b5b1-155e-4869-9785-69e111732c24","block_type":"box","text":"restrictions apply only at the time that a transaction is under taken. Any change in the percentage of the Fund’s","page_number":26,"box":{"x":69,"y":98,"width":791,"height":11}},{"id":"17d31dbb-7dbf-4025-ba91-80aed9fc1fbb","block_type":"box","text":"assets invested in cer tain securities or other instruments resulting from market fluctuations or other changes in the","page_number":26,"box":{"x":69,"y":113,"width":827,"height":11}},{"id":"3684aca0-4342-4329-8040-0d8b1d172d1c","block_type":"box","text":"Fund’s total assets will not require the Fund to dispose of an investment until BlackRock determines that it is","page_number":26,"box":{"x":70,"y":128,"width":780,"height":11}},{"id":"6829c334-6a64-41c5-8d4d-720630b5226d","block_type":"box","text":"practicable to sell or close out the investment without undue market or tax consequences.","page_number":26,"box":{"x":70,"y":143,"width":642,"height":11}},{"id":"4acd9ef7-b537-44f6-a1ee-7d71b441f944","block_type":"box","text":"The Subsidiary will follow the Fund’s fundamental and non-fundamental investment restrictions, described above,","page_number":26,"box":{"x":101,"y":166,"width":807,"height":11}},{"id":"b5ad84bf-ce08-4608-9bd9-abfc742bf681","block_type":"box","text":"with respect to its investments.","page_number":26,"box":{"x":68,"y":181,"width":224,"height":11}},{"id":"4180ff72-fe61-497a-886c-698a7d54f78c","block_type":"box","text":"III. Information on Directors and Officers","page_number":26,"box":{"x":69,"y":211,"width":294,"height":9}},{"id":"95157a1b-8aa6-41c8-8d05-d0e322dd1b65","block_type":"box","text":"The Board consists of nine individuals (each a “Director”), seven of whom are not “interested persons” of the","page_number":26,"box":{"x":101,"y":234,"width":783,"height":11}},{"id":"53c82f34-897d-4b48-8174-8da441e8e482","block_type":"box","text":"Corporation as defined in the Investment Company Act (the “Independent Directors”). The registered investment","page_number":26,"box":{"x":69,"y":249,"width":799,"height":11}},{"id":"e51e4240-9ba9-48cf-b970-f0372ab57f89","block_type":"box","text":"companies advised by the Manager or its affiliates (the “BlackRock-advised Funds”) are organized into the BlackRock","page_number":26,"box":{"x":69,"y":264,"width":837,"height":11}},{"id":"a1fd6a6a-78ba-420b-8c80-0967dda648ad","block_type":"box","text":"Multi-Asset Complex, the BlackRock Fixed-Income Complex, and the iShares Complex (each, a “BlackRock Fund","page_number":26,"box":{"x":70,"y":279,"width":793,"height":11}},{"id":"06159e03-6322-4b45-8a62-ea7600631156","block_type":"box","text":"Complex”). The Corporation is included in the BlackRock Fund Complex referred to as the BlackRock Fixed-Income","page_number":26,"box":{"x":69,"y":294,"width":811,"height":11}},{"id":"b89ec01b-14df-4a12-933c-135f7610015f","block_type":"box","text":"Complex. The Directors also oversee as board members the operations of the other open-end and closed-end","page_number":26,"box":{"x":69,"y":309,"width":779,"height":11}},{"id":"28d888b3-eb30-41a5-9946-43155d9ca425","block_type":"box","text":"registered investment companies included in the BlackRock Fixed-Income Complex.","page_number":26,"box":{"x":69,"y":324,"width":592,"height":12}},{"id":"29c8970b-b783-4bc6-8dd9-6b2bd34d66fc","block_type":"box","text":"The Board has overall responsibility for the oversight of the Corporation and the Fund. The Chair of the Board and","page_number":26,"box":{"x":101,"y":347,"width":808,"height":11}},{"id":"c13a502a-7645-48af-a0b8-2c8da01ebc89","block_type":"box","text":"the Chief Executive Officer are different people. Not only is the Chair of the Board an Independent Director, but also","page_number":26,"box":{"x":68,"y":362,"width":826,"height":11}},{"id":"36c1540d-d3f8-47fe-b133-517e85d36fba","block_type":"box","text":"the Chair of each Board committee (each, a “Committee”) is an Independent Director. The Board has six standing","page_number":26,"box":{"x":68,"y":377,"width":812,"height":12}},{"id":"0b2a60c1-886c-4473-bd45-238ea7dc3229","block_type":"box","text":"Committees: an Audit Committee, a Governance and Nominating Committee, a Compliance Committee, a","page_number":26,"box":{"x":69,"y":392,"width":750,"height":12}},{"id":"0e360d20-5e11-4c16-bade-eed032f79d06","block_type":"box","text":"Per formance Oversight Committee, a Securities Lending Committee and an Executive Committee. The role of the","page_number":26,"box":{"x":69,"y":407,"width":803,"height":12}},{"id":"16103798-60dc-46a7-b7e6-182a3cecaa12","block_type":"box","text":"Chair of the Board is to preside over all meetings of the Board and to act as a liaison with service providers, officers,","page_number":26,"box":{"x":69,"y":423,"width":836,"height":11}},{"id":"8575eebb-c0c4-466f-8135-97119f238420","block_type":"box","text":"attorneys, and other Directors between meetings. The Chair of each Committee per forms a similar role with respect","page_number":26,"box":{"x":69,"y":438,"width":826,"height":11}},{"id":"a592af2f-ea40-43b9-8d46-2fe4cd90ccbc","block_type":"box","text":"to the Committee. The Chair of the Board or a Committee may also per form such other functions as may be","page_number":26,"box":{"x":68,"y":453,"width":770,"height":11}},{"id":"33f60959-a0de-44f3-91b5-107cf57540e5","block_type":"box","text":"delegated by the Board or the Committee from time to time. The Independent Directors meet regularly outside the","page_number":26,"box":{"x":69,"y":468,"width":811,"height":11}},{"id":"e13748a5-df3b-4fde-a31c-353b478cb566","block_type":"box","text":"presence of the Fund’s management, in executive sessions or with other service providers to the Fund. The Board","page_number":26,"box":{"x":70,"y":483,"width":812,"height":11}},{"id":"78aa24bc-b1dd-4c4a-9c2f-3428f52e04b2","block_type":"box","text":"has regular meetings five times a year, including a meeting to consider the approval of the Fund’s investment","page_number":26,"box":{"x":69,"y":498,"width":780,"height":11}},{"id":"c55fe432-4372-4726-abc3-ede44c4f780b","block_type":"box","text":"management agreement, and, if necessary, may hold special meetings before its next regular meeting. The Audit","page_number":26,"box":{"x":69,"y":513,"width":805,"height":12}},{"id":"a2778ed9-bfe7-4b29-81ca-85cbab7dd9f4","block_type":"box","text":"Committee, the Governance and Nominating Committee, the Compliance Committee, the Per formance Oversight","page_number":26,"box":{"x":69,"y":528,"width":801,"height":12}},{"id":"613fb483-fba7-42c8-a3ec-55f0999e1dee","block_type":"box","text":"Committee and the Securities Lending Committee each meets regularly and the Executive Committee meets on an ad","page_number":26,"box":{"x":69,"y":544,"width":837,"height":11}},{"id":"62d3457b-40ba-4f19-b245-714608194c7f","block_type":"box","text":"hoc basis to conduct the oversight functions delegated to that Committee by the Board and repor ts its findings to the","page_number":26,"box":{"x":69,"y":559,"width":838,"height":11}},{"id":"fdaf987f-6b5c-4a7d-bdbc-dd401b93cd2d","block_type":"box","text":"Board. The Board and each standing Committee conduct annual assessments of their oversight function and","page_number":26,"box":{"x":70,"y":574,"width":773,"height":11}},{"id":"925929c9-f824-4773-bdb9-932be99c2484","block_type":"box","text":"structure. The Board has determined that the Board’s leadership structure is appropriate because it allows the Board","page_number":26,"box":{"x":69,"y":589,"width":838,"height":11}},{"id":"04351b2e-3d7c-4cfa-992f-c3efcfc4b2b3","block_type":"box","text":"to exercise independent judgment over management and to allocate areas of responsibility among Committees and","page_number":26,"box":{"x":68,"y":604,"width":823,"height":11}},{"id":"c9eda263-d780-431f-9b2e-59cf05e7b753","block_type":"box","text":"the Board to enhance oversight.","page_number":26,"box":{"x":68,"y":619,"width":227,"height":11}},{"id":"065561d5-98e1-48eb-ad02-2b04598775bc","block_type":"box","text":"The Board decided to separate the roles of Chief Executive Officer from the Chair because it believes that having","page_number":26,"box":{"x":101,"y":642,"width":805,"height":11}},{"id":"9095db09-8bde-4736-8913-e9560b4d1e30","block_type":"box","text":"an independent Chair:","page_number":26,"box":{"x":69,"y":657,"width":155,"height":11}},{"id":"53e5a7b2-d84a-464e-9f2f-10ce25f9490b","block_type":"box","text":"•","page_number":26,"box":{"x":102,"y":680,"width":6,"height":5}},{"id":"8a1c90c5-cb36-4ba4-b2bb-01d424e580fa","block_type":"box","text":"increases the independent oversight of the Fund and enhances the Board’s objective evaluation of the Chief","page_number":26,"box":{"x":135,"y":677,"width":771,"height":11}},{"id":"9d4f382c-7f85-473e-9329-bf939f185454","block_type":"box","text":"Executive Officer;","page_number":26,"box":{"x":135,"y":692,"width":121,"height":11}},{"id":"d579b3c0-82f5-44a8-a57e-c162f4a29788","block_type":"box","text":"•","page_number":26,"box":{"x":102,"y":715,"width":6,"height":5}},{"id":"b92cba6e-ed47-429e-a9fe-20c7987731d8","block_type":"box","text":"allows the Chief Executive Officer to focus on the Fund’s operations instead of Board administration;","page_number":26,"box":{"x":134,"y":712,"width":717,"height":11}},{"id":"5b8cd797-a4a0-484e-ad2b-8af47aafc98f","block_type":"box","text":"•","page_number":26,"box":{"x":102,"y":735,"width":6,"height":5}},{"id":"2f4fdba0-233d-4dcd-8340-45f1558b7385","block_type":"box","text":"provides greater oppor tunities for direct and independent communication between shareholders and the","page_number":26,"box":{"x":135,"y":732,"width":742,"height":12}},{"id":"1c765340-7793-4dc9-a7d3-0b7642fc4101","block_type":"box","text":"Board; and","page_number":26,"box":{"x":135,"y":748,"width":76,"height":10}},{"id":"0d3b87d9-7415-48ab-ba72-3311a5d2d051","block_type":"box","text":"•","page_number":26,"box":{"x":102,"y":771,"width":6,"height":4}},{"id":"2f6ec427-f422-4730-a11c-0a65b3a71eaf","block_type":"box","text":"provides an independent spokesman for the Fund.","page_number":26,"box":{"x":135,"y":768,"width":356,"height":11}},{"id":"39b4ae71-ac8f-4d32-bd19-724f524d4f66","block_type":"box","text":"The Board has engaged the Manager to manage the Fund on a day-to-day basis. The Board is responsible for","page_number":26,"box":{"x":101,"y":790,"width":777,"height":12}},{"id":"47bec3f7-c0c5-4c5c-9a79-f335f7a3c470","block_type":"box","text":"overseeing the Manager, sub-advisers, other service providers, the operations of the Fund and associated risks in","page_number":26,"box":{"x":69,"y":806,"width":811,"height":11}},{"id":"62e9bdcf-8c21-4691-aaaa-769d2fd136e1","block_type":"box","text":"accordance with the provisions of the Investment Company Act, state law, other applicable laws, the Fund’s char ter,","page_number":26,"box":{"x":69,"y":821,"width":826,"height":11}},{"id":"ddebf246-4e85-4e1b-96aa-8e87fcc04995","block_type":"box","text":"and the Fund’s investment objective and strategies. The Board reviews, on an ongoing basis, the Fund’s","page_number":26,"box":{"x":69,"y":836,"width":743,"height":11}},{"id":"d4faa6e2-d134-4653-a375-72e50806d22c","block_type":"box","text":"per formance, operations, and investment strategies and techniques. The Board also conducts reviews of the","page_number":26,"box":{"x":70,"y":851,"width":776,"height":11}},{"id":"619f717b-a5f6-4a81-a2b1-214d07d812ff","block_type":"box","text":"Manager and its role in running the operations of the Fund.","page_number":26,"box":{"x":70,"y":866,"width":419,"height":11}},{"id":"ac90b2df-7139-449e-884a-e5809a199086","block_type":"box","text":"Day-to-day risk management with respect to the Fund is the responsibility of the Manager, sub-advisers or other","page_number":26,"box":{"x":102,"y":889,"width":793,"height":11}},{"id":"f23b1ced-282d-4c7c-a1eb-c1596e5c9fed","block_type":"box","text":"service providers (depending on the nature of the risk), subject to the supervision of the Manager. The Fund is","page_number":26,"box":{"x":69,"y":904,"width":787,"height":11}},{"id":"4a3075b1-929f-486d-af2a-b976942c3d1e","block_type":"box","text":"I-10","page_number":26,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"05d36ab9-31ff-4e58-9001-cc9d13a79bd9","block_type":"box","text":"NM1026U-6033063-26/246","page_number":26,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"268bc8bd-6e50-4053-9882-7b2ad1cff558","block_type":"box","text":"subject to a number of risks, including investment, compliance, operational and valuation risks, among others. While","page_number":27,"box":{"x":69,"y":45,"width":832,"height":11}},{"id":"c2d16148-22ae-4c88-a440-61c1e6e17c27","block_type":"box","text":"there are a number of risk management functions per formed by the Manager, sub-advisers or other service providers,","page_number":27,"box":{"x":68,"y":60,"width":839,"height":11}},{"id":"e564f6b0-b42b-482c-8f77-1794f096b554","block_type":"box","text":"as applicable, it is not possible to eliminate all of the risks applicable to the Fund. Risk oversight is par t of the","page_number":27,"box":{"x":69,"y":75,"width":789,"height":11}},{"id":"63456511-c205-4723-8908-538e621729b8","block_type":"box","text":"Board’s general oversight of the Fund and is addressed as par t of various Board and Committee activities. The","page_number":27,"box":{"x":70,"y":90,"width":790,"height":11}},{"id":"13b8b24c-e031-4e0e-a5fd-9e26a6168a2e","block_type":"box","text":"Board, directly or through Committees, also reviews repor ts from, among others, management, the independent","page_number":27,"box":{"x":70,"y":105,"width":799,"height":11}},{"id":"cb309570-206b-490d-a341-cec4dfc420f4","block_type":"box","text":"registered public accounting firm for the Fund, the Manager, sub-advisers and internal auditors for the Manager or its","page_number":27,"box":{"x":69,"y":120,"width":833,"height":12}},{"id":"dcd52793-8e16-4a02-8804-d4acfc4bd140","block_type":"box","text":"affiliates, as appropriate, regarding risks faced by the Fund and management’s or the service provider’s risk","page_number":27,"box":{"x":69,"y":135,"width":774,"height":12}},{"id":"f60c7c99-da1b-45d0-963e-4cceb85d69ce","block_type":"box","text":"functions. The Committee system facilitates the timely and efficient consideration of matters by the Directors and","page_number":27,"box":{"x":68,"y":150,"width":811,"height":12}},{"id":"443284fb-f13e-467c-93e5-dc016fd7570f","block_type":"box","text":"facilitates effective oversight of compliance with legal and regulatory requirements and of the Fund’s activities and","page_number":27,"box":{"x":68,"y":166,"width":818,"height":11}},{"id":"d81fb060-6757-4732-be00-e827f591ee35","block_type":"box","text":"associated risks. The Board has approved the appointment of a Chief Compliance Officer (“CCO”), who oversees the","page_number":27,"box":{"x":69,"y":181,"width":831,"height":11}},{"id":"a06a9f24-066a-43ce-9739-e63e5ea8fb6c","block_type":"box","text":"implementation and testing of the Fund’s compliance program and repor ts regularly to the Board regarding","page_number":27,"box":{"x":70,"y":196,"width":760,"height":11}},{"id":"0dbf3384-2bf2-4617-8f1d-4451cb94bc2e","block_type":"box","text":"compliance matters for the Fund and its service providers. The Independent Directors have engaged independent","page_number":27,"box":{"x":69,"y":211,"width":807,"height":11}},{"id":"def071a0-118a-4bf7-a719-19b0fe60f8fb","block_type":"box","text":"legal counsel to assist them in per forming their oversight responsibilities.","page_number":27,"box":{"x":70,"y":226,"width":524,"height":11}},{"id":"98501df6-82b6-49a0-b906-2277377cc744","block_type":"box","text":"Audit Committee.","page_number":27,"box":{"x":101,"y":249,"width":122,"height":9}},{"id":"e413fa7f-6ed5-44a2-896a-bf1ab85c4a1d","block_type":"box","text":"The Board has a standing Audit Committee composed of Lorenzo A. Flores (Chair), J. Phillip","page_number":27,"box":{"x":229,"y":249,"width":651,"height":11}},{"id":"e7809b31-6be7-48ed-9c68-87124255e970","block_type":"box","text":"Holloman and Ar thur P. Steinmetz, all of whom are Independent Directors. The principal responsibilities of the Audit","page_number":27,"box":{"x":70,"y":264,"width":822,"height":11}},{"id":"7fae9d04-b349-4960-8602-dbbf31ac0cf8","block_type":"box","text":"Committee are to assist the Board in fulfilling its oversight responsibilities relating to the accounting and financial","page_number":27,"box":{"x":69,"y":279,"width":810,"height":11}},{"id":"cb3d5a40-84c2-4a30-90ab-281bd39853f9","block_type":"box","text":"repor ting policies and practices of the Fund. The Audit Committee’s responsibilities include, without limitation:","page_number":27,"box":{"x":69,"y":294,"width":786,"height":11}},{"id":"cb5812b5-2537-471a-a47b-265f20070ef6","block_type":"box","text":"(i) approving, and recommending to the full Board for approval, the selection, retention, termination and","page_number":27,"box":{"x":69,"y":309,"width":739,"height":11}},{"id":"b09f47fa-bc44-4c70-856b-1d419f20954e","block_type":"box","text":"compensation of the Fund’s independent registered public accounting firm (the “Independent Registered Public","page_number":27,"box":{"x":69,"y":324,"width":792,"height":12}},{"id":"c84511ed-ed62-4177-9bc8-ff0ca7543aae","block_type":"box","text":"Accounting Firm”) and evaluating the independence and objectivity of the Independent Registered Public Accounting","page_number":27,"box":{"x":68,"y":339,"width":824,"height":12}},{"id":"d8d785c7-e6db-4d3a-b922-376ce9eea2ed","block_type":"box","text":"Firm; (ii) approving all audit engagement terms and fees for the Fund; (iii) reviewing the conduct and results of each","page_number":27,"box":{"x":70,"y":355,"width":822,"height":11}},{"id":"aaf6d9ed-16e4-4789-b2a6-a5d16d727b04","block_type":"box","text":"audit; (iv) reviewing any issues raised by the Fund’s Independent Registered Public Accounting Firm or management","page_number":27,"box":{"x":69,"y":370,"width":824,"height":11}},{"id":"1283dd06-4609-4a35-ab37-3d6423720786","block_type":"box","text":"regarding the accounting or financial repor ting policies and practices of the Fund, its internal controls, and, as","page_number":27,"box":{"x":69,"y":385,"width":785,"height":11}},{"id":"800ab278-b71b-4963-b7f5-5e2d250f2ad2","block_type":"box","text":"appropriate, the internal controls of cer tain service providers and management’s response to any such issues;","page_number":27,"box":{"x":69,"y":400,"width":791,"height":11}},{"id":"22a0c3aa-24cd-40d3-85b7-b6449df135cb","block_type":"box","text":"(v) reviewing and discussing the Fund’s audited and unaudited financial statements and disclosure in the Fund’s","page_number":27,"box":{"x":69,"y":415,"width":801,"height":11}},{"id":"0a66ddb0-d158-40c3-a1bd-78c79e0f2e36","block_type":"box","text":"shareholder repor ts relating to the Fund’s per formance; (vi) assisting the Board’s responsibilities with respect to the","page_number":27,"box":{"x":69,"y":430,"width":833,"height":11}},{"id":"9292adf8-c4ea-4097-8b10-6dda241ff897","block_type":"box","text":"internal controls of the Fund and its service providers with respect to accounting and financial matters; and","page_number":27,"box":{"x":70,"y":445,"width":764,"height":12}},{"id":"cd40bf17-feb1-40b1-b807-fd8f1207c629","block_type":"box","text":"(vii) resolving any disagreements between the Fund’s management and the Fund’s Independent Registered Public","page_number":27,"box":{"x":69,"y":461,"width":809,"height":11}},{"id":"0a6b9965-c56c-402c-ab89-28f75446e83d","block_type":"box","text":"Accounting Firm regarding financial repor ting. The Board has adopted a written char ter for the Board’s Audit","page_number":27,"box":{"x":68,"y":475,"width":770,"height":12}},{"id":"41d6b647-374f-48e6-97e9-76afe3340d5e","block_type":"box","text":"Committee. During the fiscal year ended September 30, 2025, the Audit Committee met six times.","page_number":27,"box":{"x":69,"y":491,"width":703,"height":11}},{"id":"b59c33f9-d917-435d-86dc-de48ed374daa","block_type":"box","text":"Governance and Nominating Committee.","page_number":27,"box":{"x":102,"y":513,"width":286,"height":12}},{"id":"20c2248c-bbb6-4bec-8887-d2acf64c3b05","block_type":"box","text":"The Board has a standing Governance and Nominating Committee","page_number":27,"box":{"x":394,"y":513,"width":471,"height":12}},{"id":"03c3f0b6-2141-449e-a09c-4309766bdd88","block_type":"box","text":"composed of W. Carl Kester (Chair), Cynthia L. Egan, J. Phillip Holloman and R. Glenn Hubbard, all of whom are","page_number":27,"box":{"x":69,"y":528,"width":791,"height":12}},{"id":"99215151-058b-4c2e-a2a0-adfc07f0d612","block_type":"box","text":"Independent Directors. The principal responsibilities of the Governance and Nominating Committee are: (i) identifying","page_number":27,"box":{"x":70,"y":543,"width":833,"height":12}},{"id":"46c84e84-aefa-4788-b5c1-dd9bf388d822","block_type":"box","text":"individuals qualified to serve as Independent Directors and recommending Board nominees that are not “interested","page_number":27,"box":{"x":70,"y":559,"width":823,"height":11}},{"id":"012c79de-6045-48ee-8cb1-570227f9505c","block_type":"box","text":"persons” of the Fund (as defined in the Investment Company Act) for election by shareholders or appointment by the","page_number":27,"box":{"x":70,"y":574,"width":829,"height":11}},{"id":"0476a48c-326c-432e-bf56-e4a151a9b8cf","block_type":"box","text":"Board; (ii) advising the Board with respect to Board composition, procedures and Committees of the Board (other","page_number":27,"box":{"x":70,"y":589,"width":806,"height":11}},{"id":"e079c845-9420-42f3-b12c-cf1f196cc9ad","block_type":"box","text":"than the Audit Committee); (iii) overseeing periodic self-assessments of the Board and Committees of the Board","page_number":27,"box":{"x":68,"y":604,"width":800,"height":11}},{"id":"f12c78b8-6063-403c-a5f4-4804b432cb8a","block_type":"box","text":"(other than the Audit Committee); (iv) reviewing and making recommendations in respect to Independent Director","page_number":27,"box":{"x":69,"y":619,"width":804,"height":11}},{"id":"bb783d8e-e7bc-4a7a-a09b-b260eea6753d","block_type":"box","text":"compensation; (v) monitoring corporate governance matters and making recommendations in respect thereof to the","page_number":27,"box":{"x":69,"y":634,"width":823,"height":12}},{"id":"6a9d75ca-1007-47e1-971a-0bc604010634","block_type":"box","text":"Board; (vi) acting as the administrative committee with respect to Board policies and procedures, committee policies","page_number":27,"box":{"x":70,"y":650,"width":831,"height":11}},{"id":"ef9b2f89-3d2d-40f5-b62b-5391e0a7c66c","block_type":"box","text":"and procedures (other than the Audit Committee) and codes of ethics as they relate to the Independent Directors;","page_number":27,"box":{"x":69,"y":664,"width":811,"height":12}},{"id":"1170abfe-4f01-4497-bc8b-b6fb0cd470b8","block_type":"box","text":"and (vii) reviewing and making recommendations to the Board in respect of Fund share ownership by the Independent","page_number":27,"box":{"x":69,"y":680,"width":838,"height":11}},{"id":"9186162d-2679-43e9-b4f6-c24e128bdb45","block_type":"box","text":"Directors. The Board has adopted a written char ter for the Board’s Governance and Nominating Committee. During","page_number":27,"box":{"x":70,"y":695,"width":817,"height":11}},{"id":"9603847c-816c-4cbe-95d7-832edf1f506f","block_type":"box","text":"the fiscal year ended September 30, 2025, the Governance and Nominating Committee met four times.","page_number":27,"box":{"x":68,"y":710,"width":739,"height":11}},{"id":"97e0961c-efa5-49c8-8ad5-847ab2ff1a56","block_type":"box","text":"The Governance and Nominating Committee of the Board seeks to identify individuals to serve on the Board who","page_number":27,"box":{"x":101,"y":732,"width":803,"height":12}},{"id":"b399b646-0d52-4703-9e90-327fd57094ec","block_type":"box","text":"have a diverse range of viewpoints, qualifications, experiences, backgrounds and skill sets so that the Board will be","page_number":27,"box":{"x":69,"y":748,"width":825,"height":11}},{"id":"e167b2b0-2ade-4ce4-b9a5-3a49b5262227","block_type":"box","text":"better suited to fulfill its responsibility of overseeing the Fund’s activities. In so doing, the Governance and","page_number":27,"box":{"x":69,"y":763,"width":759,"height":11}},{"id":"d64742d9-d399-4601-99e5-b755a8fe7be2","block_type":"box","text":"Nominating Committee reviews the size of the Board, the ages of the current Directors and their tenure on the Board,","page_number":27,"box":{"x":70,"y":778,"width":836,"height":11}},{"id":"d9a9d015-ff08-45f1-94be-57b69f0880c6","block_type":"box","text":"and the skills, background and experiences of the Directors in light of the issues facing the Fund in determining","page_number":27,"box":{"x":69,"y":793,"width":796,"height":11}},{"id":"37c6b612-6ddc-4681-806e-d29a3f611991","block_type":"box","text":"whether one or more new directors should be added to the Board. The Board as a group strives to achieve diversity in","page_number":27,"box":{"x":68,"y":808,"width":839,"height":11}},{"id":"767d4ea0-79f0-47ea-8f4d-ec945abb86d8","block_type":"box","text":"terms of gender, race and geographic location. The Governance and Nominating Committee believes that the","page_number":27,"box":{"x":68,"y":823,"width":775,"height":12}},{"id":"196035f4-bc75-4f20-84b2-8ec9077f944e","block_type":"box","text":"Directors as a group possess the array of skills, experiences and backgrounds necessary to guide the Fund. The","page_number":27,"box":{"x":70,"y":838,"width":802,"height":12}},{"id":"cc22b02a-350d-43a5-86e5-63642a0d7165","block_type":"box","text":"Directors’ biographies included herein highlight the diversity and breadth of skills, qualifications and exper tise that","page_number":27,"box":{"x":70,"y":853,"width":816,"height":12}},{"id":"9086ba3b-7be7-4a0d-9986-c4f61ecfa554","block_type":"box","text":"the Directors bring to the Fund.","page_number":27,"box":{"x":68,"y":869,"width":221,"height":11}},{"id":"90102081-2073-47d8-a40c-44de724bc685","block_type":"box","text":"The Governance and Nominating Committee may consider nominations for Directors made by the Fund’s","page_number":27,"box":{"x":101,"y":891,"width":744,"height":12}},{"id":"b5219c04-057a-443b-b749-ff1a7952d90f","block_type":"box","text":"shareholders as it deems appropriate. Under the Corporation’s Bylaws, shareholders must follow cer tain procedures","page_number":27,"box":{"x":69,"y":906,"width":831,"height":12}},{"id":"566c1bc6-5b99-4bdb-9f44-371a2192c01e","block_type":"box","text":"I-11","page_number":27,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"41382f46-7060-4b0b-9ef5-50257d785d7a","block_type":"box","text":"NM1026U-6033063-27/246","page_number":27,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"b58be341-2264-4680-9426-d9a77b9a6f27","block_type":"box","text":"to nominate a person for election as a Director at a shareholder meeting at which Directors are to be elected. Under","page_number":28,"box":{"x":68,"y":45,"width":830,"height":11}},{"id":"edfb395e-7315-48fb-8190-52d3f74c2587","block_type":"box","text":"these advance notice procedures, shareholders must submit the proposed nominee by delivering a notice to the","page_number":28,"box":{"x":68,"y":60,"width":801,"height":11}},{"id":"7cbe0750-bee0-4077-bc3a-f64a6b1a6f5d","block_type":"box","text":"Secretary of the Fund at its principal executive offices no later than the close of business on the fifth (5th) day","page_number":28,"box":{"x":69,"y":75,"width":790,"height":11}},{"id":"a961ae37-2f8a-45e8-9e96-ba8fdab24b77","block_type":"box","text":"following the day on which notice of the date of the meeting was mailed or public disclosure of the date of the","page_number":28,"box":{"x":68,"y":90,"width":784,"height":11}},{"id":"04b42b58-9513-4de3-85e1-ecde0b855d18","block_type":"box","text":"meeting was made, whichever first occurs.","page_number":28,"box":{"x":69,"y":105,"width":302,"height":11}},{"id":"860509f3-e60c-4d7d-abaa-8aa6f8fa8c3d","block_type":"box","text":"The Corporation’s Bylaws provide that notice of a proposed nomination must include cer tain information about","page_number":28,"box":{"x":101,"y":128,"width":789,"height":11}},{"id":"760cd7b1-383f-419d-bb1b-03634b7c7c30","block_type":"box","text":"the shareholder and the nominee, as well as cer tain other information, including a written consent of the proposed","page_number":28,"box":{"x":68,"y":143,"width":820,"height":11}},{"id":"66e9d5d6-4d7e-4f0c-8ba3-d4c4ebf68381","block_type":"box","text":"nominee to serve if elected. Reference is made to the Corporation’s Bylaws for more details.","page_number":28,"box":{"x":69,"y":158,"width":662,"height":11}},{"id":"b0f408b2-bbae-4067-b325-6268ae6bcbb3","block_type":"box","text":"Compliance Committee.","page_number":28,"box":{"x":102,"y":181,"width":168,"height":11}},{"id":"9f5ca2f6-eed8-4d0d-abdb-1834d181fb75","block_type":"box","text":"The Board has a Compliance Committee composed of Cynthia L. Egan (Chair), Stayce D.","page_number":28,"box":{"x":276,"y":181,"width":628,"height":11}},{"id":"ac14052e-fadb-4531-9845-a7392a8eafd9","block_type":"box","text":"Harris, R. Glenn Hubbard and W. Carl Kester, all of whom are Independent Directors. The Compliance Committee’s","page_number":28,"box":{"x":70,"y":196,"width":815,"height":11}},{"id":"ae8ba658-9a8a-40d0-bee9-076f39f478ad","block_type":"box","text":"purpose is to assist the Board in fulfilling its responsibility with respect to the oversight of regulatory and fiduciary","page_number":28,"box":{"x":70,"y":211,"width":814,"height":11}},{"id":"06c0f35f-801d-4ff3-be31-ab453515f5f1","block_type":"box","text":"compliance matters involving the Fund, the fund-related activities of BlackRock, and any sub-advisers and the Fund’s","page_number":28,"box":{"x":69,"y":226,"width":831,"height":11}},{"id":"60a58285-f11b-402b-a327-b2f28f92af1e","block_type":"box","text":"other third par ty service providers. The Compliance Committee’s responsibilities include, without limitation:","page_number":28,"box":{"x":69,"y":241,"width":765,"height":11}},{"id":"766bf08d-679c-41fa-99cb-283a799b021e","block_type":"box","text":"(i) overseeing the compliance policies and procedures of the Fund and its service providers and recommending","page_number":28,"box":{"x":69,"y":256,"width":791,"height":12}},{"id":"0f425f15-08d7-410e-8d97-b8ac6c382e37","block_type":"box","text":"changes or additions to such policies and procedures; (ii) reviewing information on and, where appropriate,","page_number":28,"box":{"x":69,"y":271,"width":762,"height":12}},{"id":"b4bc0c8d-691c-485d-9859-432f899b1650","block_type":"box","text":"recommending policies concerning the Fund’s compliance with applicable law; (iii) reviewing information on any","page_number":28,"box":{"x":69,"y":286,"width":791,"height":12}},{"id":"2b344190-e5f7-40f3-9b11-2edf8b0581d2","block_type":"box","text":"significant correspondence with or other actions by regulators or governmental agencies with respect to the Fund and","page_number":28,"box":{"x":69,"y":302,"width":836,"height":11}},{"id":"5adacff9-3c08-409a-9903-b9aa97d32deb","block_type":"box","text":"any employee complaints or published repor ts that raise concerns regarding compliance matters; and (iv) reviewing","page_number":28,"box":{"x":69,"y":317,"width":822,"height":11}},{"id":"e55e8acd-cc79-4960-9f85-151dbfab73d4","block_type":"box","text":"repor ts from, overseeing the annual per formance review of, and making cer tain recommendations in respect of, the","page_number":28,"box":{"x":69,"y":332,"width":827,"height":11}},{"id":"38f210a7-b266-4c6e-afea-0dd3629017b8","block_type":"box","text":"Fund’s CCO, including, without limitation, determining the amount and structure of the CCO’s compensation. The","page_number":28,"box":{"x":70,"y":347,"width":803,"height":11}},{"id":"c77ded1b-99ed-4881-a4e7-fb0059675164","block_type":"box","text":"Board has adopted a written char ter for the Board’s Compliance Committee. During the fiscal year ended","page_number":28,"box":{"x":70,"y":362,"width":747,"height":11}},{"id":"cd26745f-4017-4664-a2c1-cb359ffa848c","block_type":"box","text":"September 30, 2025, the Compliance Committee met four times.","page_number":28,"box":{"x":69,"y":377,"width":467,"height":11}},{"id":"f90da3f1-9cf1-4497-9f34-6c423b61d483","block_type":"box","text":"Per formance Oversight Committee.","page_number":28,"box":{"x":102,"y":400,"width":248,"height":11}},{"id":"48db083d-e215-42ce-b268-a8b1f6038b92","block_type":"box","text":"The Board has a Per formance Oversight Committee composed of Ar thur P.","page_number":28,"box":{"x":356,"y":400,"width":530,"height":11}},{"id":"2c83eb5c-6596-4e16-8a15-ff9d7295d5a4","block_type":"box","text":"Steinmetz (Chair), Cynthia L. Egan, Lorenzo A. Flores, Stayce D. Harris, J. Phillip Holloman, R. Glenn Hubbard and W.","page_number":28,"box":{"x":69,"y":415,"width":828,"height":11}},{"id":"eaba9abd-07ff-478b-aaf7-bf76cbd0ea99","block_type":"box","text":"Carl Kester, all of whom are Independent Directors. The Per formance Oversight Committee’s purpose is to assist the","page_number":28,"box":{"x":69,"y":430,"width":834,"height":11}},{"id":"95468062-5edb-42ba-81a0-9540b43c0906","block_type":"box","text":"Board in fulfilling its responsibility to oversee the Fund’s investment per formance relative to the Fund’s investment","page_number":28,"box":{"x":70,"y":445,"width":819,"height":12}},{"id":"2307cbce-3d8f-4e0c-9138-790137a51dd1","block_type":"box","text":"objective, policies and practices. The Per formance Oversight Committee’s responsibilities include, without limitation:","page_number":28,"box":{"x":69,"y":460,"width":832,"height":12}},{"id":"b443e18c-00c2-4535-83df-0ec8e74f9fda","block_type":"box","text":"(i) reviewing the Fund’s investment objective, policies and practices; (ii) recommending to the Board any required","page_number":28,"box":{"x":69,"y":476,"width":803,"height":11}},{"id":"a766fe87-85ff-4820-8024-e1c34b5c3b02","block_type":"box","text":"action in respect of changes in fundamental and non-fundamental investment restrictions; (iii) reviewing information","page_number":28,"box":{"x":69,"y":491,"width":824,"height":11}},{"id":"6f309f5d-fa63-495b-bc7f-8f1570dd1213","block_type":"box","text":"on appropriate benchmarks and competitive universes; (iv) reviewing the Fund’s investment per formance relative to","page_number":28,"box":{"x":69,"y":506,"width":823,"height":11}},{"id":"e89fd953-bed8-4e86-96bd-19c3f56eda70","block_type":"box","text":"such benchmarks; (v) reviewing information on unusual or exceptional investment matters; (vi) reviewing whether the","page_number":28,"box":{"x":69,"y":521,"width":830,"height":11}},{"id":"7f597884-b6ed-4edc-99f1-187030712a96","block_type":"box","text":"Fund has complied with its investment policies and restrictions; and (vii) overseeing policies, procedures and controls","page_number":28,"box":{"x":70,"y":536,"width":837,"height":11}},{"id":"f05166bf-c652-4a31-b3ff-70a06ff28270","block_type":"box","text":"regarding valuation of the Fund’s investments. The Board has adopted a written char ter for the Board’s Per formance","page_number":28,"box":{"x":69,"y":551,"width":832,"height":11}},{"id":"31802561-2a6c-4294-8203-3e984df69774","block_type":"box","text":"Oversight Committee. During the fiscal year ended September 30, 2025, the Per formance Oversight Committee met","page_number":28,"box":{"x":69,"y":566,"width":829,"height":11}},{"id":"f6aaa1c4-7186-4a3e-82ea-4f3c5ac47785","block_type":"box","text":"four times.","page_number":28,"box":{"x":68,"y":581,"width":76,"height":9}},{"id":"5f508bb4-6400-4a82-8aac-12382f8980aa","block_type":"box","text":"Securities Lending Committee.","page_number":28,"box":{"x":102,"y":604,"width":217,"height":11}},{"id":"b80f769e-d2f7-44cb-9778-37812ea83993","block_type":"box","text":"The Board has a Securities Lending Committee composed of Cynthia L. Egan","page_number":28,"box":{"x":325,"y":604,"width":547,"height":11}},{"id":"b11762bc-2bbd-4eba-b604-1fa7968197fa","block_type":"box","text":"(Chair) and W. Carl Kester, both of whom are Independent Directors. The principal responsibilities of the Securities","page_number":28,"box":{"x":69,"y":619,"width":816,"height":11}},{"id":"2d031e5c-a083-4e79-aa95-43e347ebd366","block_type":"box","text":"Lending Committee include, without limitation: (i) suppor ting, overseeing and organizing on behalf of the Board the","page_number":28,"box":{"x":70,"y":634,"width":815,"height":12}},{"id":"ed7d087a-8c8d-4128-a0f8-329052fd3d0e","block_type":"box","text":"process for oversight of the Fund’s securities lending activities; and (ii) providing a recommendation to the Board","page_number":28,"box":{"x":70,"y":649,"width":804,"height":12}},{"id":"dcdec329-105a-4ed8-9148-d9a62991fb17","block_type":"box","text":"regarding the annual approval of the Fund’s Securities Lending Guidelines and the Fund’s agreement with the lending","page_number":28,"box":{"x":69,"y":664,"width":837,"height":12}},{"id":"70013d7c-1d70-474b-968f-e1fec5965b10","block_type":"box","text":"agent. The Board has adopted a written char ter for the Board’s Securities Lending Committee. During the fiscal year","page_number":28,"box":{"x":69,"y":680,"width":829,"height":11}},{"id":"23eb1314-0862-45bc-ab79-39d69da8cbec","block_type":"box","text":"ended September 30, 2025, the Securities Lending Committee met once.","page_number":28,"box":{"x":69,"y":695,"width":526,"height":11}},{"id":"a79f292a-5850-4e32-8af2-3a2ed6e4678f","block_type":"box","text":"Executive Committee.","page_number":28,"box":{"x":102,"y":718,"width":152,"height":8}},{"id":"71d90b02-6f8e-4939-aabc-ab49f73c023d","block_type":"box","text":"The Board has an Executive Committee composed of R. Glenn Hubbard (Chair) and W. Carl","page_number":28,"box":{"x":260,"y":717,"width":645,"height":11}},{"id":"8300ec1a-14c6-47be-8af1-a4726dc1396c","block_type":"box","text":"Kester, both of whom are Independent Directors, and John M. Perlowski, who serves as an interested Director. The","page_number":28,"box":{"x":70,"y":732,"width":819,"height":11}},{"id":"7e98b21d-d649-4a87-8428-4148ef128d9b","block_type":"box","text":"principal responsibilities of the Executive Committee include, without limitation: (i) acting on routine matters between","page_number":28,"box":{"x":70,"y":748,"width":832,"height":11}},{"id":"97560fa1-3088-4d96-883c-2896ff5f186c","block_type":"box","text":"meetings of the Board; (ii) acting on such matters as may require urgent action between meetings of the Board; and","page_number":28,"box":{"x":69,"y":763,"width":828,"height":11}},{"id":"f19ea6cf-bd26-43f7-b6f4-7a2c2901fd9b","block_type":"box","text":"(iii) exercising such other authority as may from time to time be delegated to the Executive Committee by the Board.","page_number":28,"box":{"x":69,"y":778,"width":826,"height":11}},{"id":"a06e7f1c-c28c-45e3-b8d4-194b9e9ad61b","block_type":"box","text":"The Board has adopted a written char ter for the Board’s Executive Committee. During the fiscal year ended","page_number":28,"box":{"x":68,"y":793,"width":764,"height":11}},{"id":"24298ce8-13b5-4363-bf83-57f0202c2a03","block_type":"box","text":"September 30, 2025, the Executive Committee did not meet.","page_number":28,"box":{"x":69,"y":808,"width":436,"height":11}},{"id":"c232695e-0f60-43f8-b053-c24da39c0142","block_type":"box","text":"The Independent Directors have adopted a statement of policy that describes the experiences, qualifications,","page_number":28,"box":{"x":101,"y":831,"width":778,"height":11}},{"id":"d0876a1f-beae-4414-86e9-6b19f3bcf78f","block_type":"box","text":"skills and attributes that are necessary and desirable for potential Independent Director candidates (the “Statement","page_number":28,"box":{"x":69,"y":846,"width":830,"height":11}},{"id":"4aec4980-cf42-4c45-b15b-0013633db234","block_type":"box","text":"of Policy”). The Board believes that each Independent Director satisfied, at the time he or she was initially elected or","page_number":28,"box":{"x":69,"y":861,"width":833,"height":11}},{"id":"c6ef54ed-f294-40e3-b1a4-a6e952ab1607","block_type":"box","text":"appointed a Director, and continues to satisfy, the standards contemplated by the Statement of Policy as well as the","page_number":28,"box":{"x":69,"y":876,"width":830,"height":11}},{"id":"d73c0fc3-278a-4981-bc6d-bda41c09965c","block_type":"box","text":"standards set for th in the Fund’s Bylaws. Fur thermore, in determining that a par ticular Director was and continues to","page_number":28,"box":{"x":69,"y":891,"width":836,"height":12}},{"id":"5dd58d13-50d9-4863-8acc-938ab57316c6","block_type":"box","text":"be qualified to serve as a Director, the Board has considered a variety of criteria, none of which, in isolation, was","page_number":28,"box":{"x":69,"y":906,"width":807,"height":12}},{"id":"19d06f8b-dead-401a-925d-d3f0d55f5b24","block_type":"box","text":"I-12","page_number":28,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"f9c64a5a-6e0e-4a99-bb95-f331d7c50cfa","block_type":"box","text":"NM1026U-6033063-28/246","page_number":28,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"c7cce13f-52d5-420a-b352-05286401f3fb","block_type":"box","text":"controlling. The Board believes that, collectively, the Directors have balanced and diverse experiences, skills,","page_number":29,"box":{"x":69,"y":45,"width":775,"height":11}},{"id":"188ec591-15e9-4324-b674-659d1fed523d","block_type":"box","text":"attributes and qualifications, which allow the Board to operate effectively in governing the Fund and protecting the","page_number":29,"box":{"x":69,"y":60,"width":812,"height":11}},{"id":"fb1680ef-b403-4352-8c0e-85203a111d76","block_type":"box","text":"interests of shareholders. Among the attributes common to all Directors is their ability to review critically, evaluate,","page_number":29,"box":{"x":70,"y":75,"width":817,"height":11}},{"id":"2f8d270b-e2b8-4eb6-ba99-b913b0874ec7","block_type":"box","text":"question and discuss information provided to them, to interact effectively with the Manager, sub-advisers, other","page_number":29,"box":{"x":69,"y":90,"width":796,"height":11}},{"id":"cffcddf4-e948-4864-972c-239bd3a24d6e","block_type":"box","text":"service providers, counsel and independent auditors, and to exercise effective business judgment in the","page_number":29,"box":{"x":69,"y":105,"width":744,"height":11}},{"id":"4978c605-d26a-4fe6-b4d4-9e2c01d6d766","block_type":"box","text":"per formance of their duties as Directors. Each Director’s ability to per form his or her duties effectively is evidenced","page_number":29,"box":{"x":70,"y":120,"width":823,"height":11}},{"id":"294eb76a-6944-4fdb-9b26-82076521dd19","block_type":"box","text":"by his or her educational background or professional training; business, consulting, public service or academic","page_number":29,"box":{"x":69,"y":135,"width":788,"height":12}},{"id":"b016eecf-d36e-4d64-aeb9-028618849ad0","block_type":"box","text":"positions; experience from service as a board member of the Corporation or the other funds in the BlackRock Fund","page_number":29,"box":{"x":70,"y":150,"width":818,"height":11}},{"id":"11460a8c-b960-40ee-9681-f8baf4f3a532","block_type":"box","text":"Complexes (and any predecessor funds), other investment funds, public companies, or not-for-profit entities or other","page_number":29,"box":{"x":69,"y":166,"width":828,"height":11}},{"id":"632f1421-1acd-4307-8350-10df99bbf1e6","block_type":"box","text":"organizations; ongoing commitment and par ticipation in Board and Committee meetings, as well as his or her","page_number":29,"box":{"x":69,"y":181,"width":782,"height":11}},{"id":"3a88b1da-fbec-475c-9cb3-718796ed5abb","block_type":"box","text":"leadership of standing and other committees throughout the years; or other relevant life experiences.","page_number":29,"box":{"x":70,"y":196,"width":719,"height":11}},{"id":"53916fa8-6757-40f8-9b40-e703b404394a","block_type":"box","text":"The table below discusses some of the experiences, qualifications and skills of each Director that suppor t the","page_number":29,"box":{"x":101,"y":218,"width":787,"height":11}},{"id":"a0c5fed1-3189-4f22-937a-541f0e9a9698","block_type":"box","text":"conclusion that he or she should serve on the Board.","page_number":29,"box":{"x":69,"y":234,"width":378,"height":9}},{"id":"5f0e23a8-01df-4892-9d63-93e85f83c27c","block_type":"box","text":"Directors Experience, Qualifications and Skills","page_number":29,"box":{"x":69,"y":262,"width":408,"height":9}},{"id":"95aaae4e-ca4c-4d9e-bccf-a29f48b8aa55","block_type":"box","text":"Independent Directors","page_number":29,"box":{"x":70,"y":279,"width":156,"height":10}},{"id":"29000154-6784-43b6-b728-0a37dbf43f0b","block_type":"box","text":"R. Glenn Hubbard R. Glenn Hubbard has served in numerous roles in the field of economics, including as","page_number":29,"box":{"x":70,"y":293,"width":814,"height":12}},{"id":"df7787a3-b2ae-4c83-8138-c5c2e995981e","block_type":"box","text":"the Chairman of the U.S. Council of Economic Advisers of the President of the United","page_number":29,"box":{"x":264,"y":309,"width":606,"height":9}},{"id":"72178520-73b2-40c5-a342-71a204998763","block_type":"box","text":"States. Dr. Hubbard has served as the Dean of Columbia Business School, as a member","page_number":29,"box":{"x":265,"y":324,"width":635,"height":10}},{"id":"18fce2f3-1c11-4c72-81ac-62b04e8240b0","block_type":"box","text":"of the Columbia Faculty and as a Visiting Professor at the John F. Kennedy School of","page_number":29,"box":{"x":265,"y":339,"width":602,"height":11}},{"id":"cee3cd4d-e5ae-488b-bfdc-f318b115c49f","block_type":"box","text":"Government at Harvard University, the Harvard Business School and the University of","page_number":29,"box":{"x":265,"y":354,"width":608,"height":11}},{"id":"b7dee33d-5885-4306-909f-c1e2b94218b5","block_type":"box","text":"Chicago. Dr. Hubbard’s experience as an adviser to the President of the United States","page_number":29,"box":{"x":265,"y":369,"width":613,"height":11}},{"id":"ff63e4b6-edb7-45bd-9fa3-5bae3c52e739","block_type":"box","text":"adds a dimension of balance to the Fund’s governance and provides perspective on","page_number":29,"box":{"x":265,"y":384,"width":595,"height":11}},{"id":"c6d935c1-5c64-43b2-a155-f0806decafe1","block_type":"box","text":"economic issues. Dr. Hubbard’s service on the boards of ADP and Metropolitan Life","page_number":29,"box":{"x":265,"y":399,"width":597,"height":11}},{"id":"edb46115-343a-43e5-89de-f4004500b722","block_type":"box","text":"Insurance Company provides the Board with the benefit of his experience with the","page_number":29,"box":{"x":265,"y":414,"width":581,"height":12}},{"id":"553e8354-9eab-4504-9af8-5ffbc9196abe","block_type":"box","text":"management practices of other financial companies. Dr. Hubbard’s long-standing service","page_number":29,"box":{"x":265,"y":429,"width":632,"height":12}},{"id":"cb15695f-bf09-4791-aa6d-9fd31d359fad","block_type":"box","text":"on the boards of directors/trustees of the closed-end funds in the BlackRock Fixed","page_number":29,"box":{"x":265,"y":445,"width":594,"height":11}},{"id":"cbe0f105-77fd-4fd9-acab-b287e798e15d","block_type":"box","text":"Income Complex also provides him with a specific understanding of the Fund, its","page_number":29,"box":{"x":265,"y":460,"width":573,"height":11}},{"id":"26ceddc0-228d-40ce-94fa-d9f74d2f9c63","block_type":"box","text":"operations, and the business and regulatory issues facing the Fund. Dr. Hubbard’s","page_number":29,"box":{"x":265,"y":475,"width":589,"height":11}},{"id":"1f398e2a-6c21-49dd-b265-00d3dde939ea","block_type":"box","text":"independence from the Fund and the Manager enhances his service as Chair of the","page_number":29,"box":{"x":265,"y":490,"width":595,"height":11}},{"id":"f2c69055-453f-4054-9a7d-a7c201974b5f","block_type":"box","text":"Board, Chair of the Executive Committee and a member of the Governance and","page_number":29,"box":{"x":265,"y":505,"width":562,"height":11}},{"id":"cbb82ef5-d5e9-4a89-8070-4ef751c39d10","block_type":"box","text":"Nominating Committee, the Compliance Committee and the Per formance Oversight","page_number":29,"box":{"x":265,"y":520,"width":592,"height":12}},{"id":"36e366f8-7353-4eef-a684-d5a2d5f55d16","block_type":"box","text":"Committee.","page_number":29,"box":{"x":265,"y":535,"width":80,"height":9}},{"id":"9a601e62-4908-403a-b6e0-45c1a8bea8dd","block_type":"box","text":"W. Carl Kester The Board benefits from W. Carl Kester’s experiences as a professor and author in","page_number":29,"box":{"x":68,"y":558,"width":786,"height":11}},{"id":"0442c05a-21d5-4d9a-8ac9-81de89b8aa17","block_type":"box","text":"finance, and his experience as the George Fisher Baker Jr. Professor of Business","page_number":29,"box":{"x":264,"y":573,"width":578,"height":11}},{"id":"820e665d-5e22-4736-9da1-eaa4bd3a8708","block_type":"box","text":"Administration at Harvard Business School and as Deputy Dean of Academic Affairs at","page_number":29,"box":{"x":264,"y":588,"width":618,"height":11}},{"id":"46bb8039-49c1-4111-b71e-fbf392360506","block_type":"box","text":"Harvard Business School from 2006 through 2010 adds to the Board a wealth of","page_number":29,"box":{"x":265,"y":603,"width":581,"height":12}},{"id":"044cfcac-f1cf-42af-aba0-d4f0cdc3cb86","block_type":"box","text":"exper tise in corporate finance and corporate governance. Dr. Kester has authored and","page_number":29,"box":{"x":265,"y":618,"width":613,"height":12}},{"id":"cb42a808-e955-4eec-85bd-7ec8827cbd76","block_type":"box","text":"edited numerous books and research papers on both subject matters, including co-editing","page_number":29,"box":{"x":265,"y":634,"width":641,"height":11}},{"id":"08c4c958-fa72-4f1f-bf17-1694e7d541af","block_type":"box","text":"a leading volume of finance case studies used worldwide. Dr. Kester’s long-standing","page_number":29,"box":{"x":265,"y":649,"width":599,"height":11}},{"id":"52545a37-04f1-43c5-b7e2-ab6ba1ab8049","block_type":"box","text":"service on the boards of directors/trustees of the closed-end funds in the BlackRock","page_number":29,"box":{"x":265,"y":664,"width":605,"height":11}},{"id":"cecf137b-81ba-45ab-94cf-54d61cb0bff7","block_type":"box","text":"Fixed-Income Complex also provides him with a specific understanding of the Fund, its","page_number":29,"box":{"x":265,"y":679,"width":613,"height":11}},{"id":"d56c9400-ca77-4ff4-bdaf-8b605fb9447a","block_type":"box","text":"operations, and the business and regulatory issues facing the Fund. Dr. Kester’s","page_number":29,"box":{"x":265,"y":694,"width":576,"height":11}},{"id":"4e0e0c91-81ac-4e46-9735-0a92821a6576","block_type":"box","text":"independence from the Fund and the Manager enhances his service as Vice Chair of the","page_number":29,"box":{"x":265,"y":709,"width":630,"height":11}},{"id":"df6e747d-66e5-4699-933e-dee0d3d95c78","block_type":"box","text":"Board, Chair of the Governance and Nominating Committee and a member of the","page_number":29,"box":{"x":265,"y":724,"width":576,"height":12}},{"id":"8fa5f489-8799-4cc2-9dc5-2882cddca469","block_type":"box","text":"Executive Committee, the Compliance Committee, the Per formance Oversight Committee","page_number":29,"box":{"x":265,"y":739,"width":634,"height":12}},{"id":"4009a503-6829-4b7a-a42e-46e31c8ded92","block_type":"box","text":"and the Securities Lending Committee.","page_number":29,"box":{"x":265,"y":755,"width":275,"height":11}},{"id":"20197cca-702b-4a6b-a2f3-d73431da9797","block_type":"box","text":"I-13","page_number":29,"box":{"x":476,"y":943,"width":26,"height":9}},{"id":"0ee9b37d-1d18-40c9-97db-50fd70ed5465","block_type":"box","text":"NM1026U-6033063-29/246","page_number":29,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"ca882cae-798c-4a03-8a1e-7e0ef44308df","block_type":"box","text":"Directors Experience, Qualifications and Skills","page_number":30,"box":{"x":69,"y":49,"width":408,"height":9}},{"id":"c9ede21d-de84-4bae-b405-2dba54d32550","block_type":"box","text":"Cynthia L. Egan Cynthia L. Egan brings to the Board a broad and diverse knowledge of investment","page_number":30,"box":{"x":69,"y":65,"width":775,"height":12}},{"id":"2cbdd41b-7e5b-426a-9aaf-a5bed3add587","block_type":"box","text":"companies and the retirement industry as a result of her many years of experience as","page_number":30,"box":{"x":264,"y":81,"width":613,"height":11}},{"id":"55dd924f-9f56-42a4-90ea-33e02b0c2e12","block_type":"box","text":"President, Retirement Plan Services, for T. Rowe Price Group, Inc. and her various senior","page_number":30,"box":{"x":265,"y":96,"width":633,"height":11}},{"id":"3e6ebef8-520e-4875-bce4-61ea9557b9c7","block_type":"box","text":"operating officer positions at Fidelity Investments, including her service as Executive Vice","page_number":30,"box":{"x":265,"y":111,"width":636,"height":11}},{"id":"d51e907d-40c1-4d45-b5d0-9785432b75fa","block_type":"box","text":"President of FMR Co., President of Fidelity Institutional Services Company and President","page_number":30,"box":{"x":265,"y":126,"width":629,"height":11}},{"id":"14d0f05f-e92c-400f-9ab8-b0dd87018019","block_type":"box","text":"of the Fidelity Charitable Gift Fund. Ms. Egan has also served as an advisor to the U.S.","page_number":30,"box":{"x":265,"y":141,"width":617,"height":11}},{"id":"b8af715a-c39e-4707-9dff-28fc2bd0ae91","block_type":"box","text":"Depar tment of Treasury as an exper t in domestic retirement security. Ms. Egan began her","page_number":30,"box":{"x":265,"y":156,"width":642,"height":11}},{"id":"5547d5c4-bf84-4e28-b7b3-99f5f3fe6353","block_type":"box","text":"professional career at the Board of Governors of the Federal Reserve and the Federal","page_number":30,"box":{"x":265,"y":171,"width":608,"height":11}},{"id":"b2fbbeae-1619-41d8-9d14-3aa2fd17dc58","block_type":"box","text":"Reserve Bank of New York. Ms. Egan is also a director of UNUM Corporation, a publicly","page_number":30,"box":{"x":265,"y":186,"width":620,"height":12}},{"id":"3456b598-4bb4-4381-8b27-45c10b3540fb","block_type":"box","text":"traded insurance company providing personal risk reinsurance, and a director and Chair of","page_number":30,"box":{"x":264,"y":201,"width":643,"height":12}},{"id":"c52490e0-29fc-4c4d-8335-e0caf30f2216","block_type":"box","text":"the Board of The Hanover Group, a public proper ty casualty insurance company. Ms. Egan","page_number":30,"box":{"x":264,"y":217,"width":640,"height":11}},{"id":"4e40bb4a-4719-49f8-83b5-5bfbc3e4e39c","block_type":"box","text":"is also the lead independent director and non-executive Vice Chair of the Board of","page_number":30,"box":{"x":265,"y":232,"width":583,"height":11}},{"id":"a0f1238a-287f-451e-ab53-547c5919157d","block_type":"box","text":"Huntsman Corporation, a publicly traded manufacturer and marketer of chemical products.","page_number":30,"box":{"x":265,"y":247,"width":643,"height":11}},{"id":"36fa08cf-64ec-49d2-85c3-9d1fc8ef28f8","block_type":"box","text":"Ms. Egan’s independence from the Fund and the Manager enhances her service as Chair","page_number":30,"box":{"x":265,"y":262,"width":636,"height":11}},{"id":"e34dead7-9fc1-4d1b-a693-6ba62d366a90","block_type":"box","text":"of the Compliance Committee, Chair of the Securities Lending Committee and a member","page_number":30,"box":{"x":265,"y":277,"width":631,"height":11}},{"id":"bdb88ab3-e2f7-4659-a948-30fe7f83714a","block_type":"box","text":"of the Governance and Nominating Committee and the Per formance Oversight Committee.","page_number":30,"box":{"x":265,"y":292,"width":642,"height":11}},{"id":"51339062-ea16-4885-a87f-db5b762d9ba8","block_type":"box","text":"Lorenzo A. Flores The Board benefits from Lorenzo A. Flores’s many years of business, leadership and","page_number":30,"box":{"x":70,"y":315,"width":796,"height":11}},{"id":"86782339-cc91-4aec-88f6-3f404258a7f0","block_type":"box","text":"financial experience in his roles at various public and private companies. In par ticular,","page_number":30,"box":{"x":264,"y":330,"width":612,"height":11}},{"id":"71c4cf82-b3eb-4b59-8eb1-598c0855d568","block_type":"box","text":"Mr. Flores’s service as Chief Financial Officer of Lattice Semiconductor Corporation, a","page_number":30,"box":{"x":265,"y":345,"width":611,"height":11}},{"id":"7b9d344d-0baf-4aa5-a998-a21f70e26913","block_type":"box","text":"semiconductor company that designs, develops, and markets programmable logic","page_number":30,"box":{"x":265,"y":360,"width":582,"height":12}},{"id":"a4a66b85-9b6c-4b80-87a4-5e9c982bada8","block_type":"box","text":"products and related software, Chief Financial Officer of Intel Foundry, a semiconductor","page_number":30,"box":{"x":265,"y":375,"width":622,"height":11}},{"id":"d66b06a2-1496-4207-86b1-fb1d7bf3028c","block_type":"box","text":"manufacturing unit of Intel Corporation, Chief Financial Officer and Corporate Controller of","page_number":30,"box":{"x":265,"y":390,"width":639,"height":12}},{"id":"8843492c-fc9c-4cb3-9acb-c6a0b3abcf5a","block_type":"box","text":"Xilinx, Inc., a technology and semiconductor company that supplies programmable logic","page_number":30,"box":{"x":264,"y":406,"width":622,"height":11}},{"id":"1a80c92c-fa8e-46aa-bcc8-5fb6c65f0824","block_type":"box","text":"devices, and Vice Chairman of Kioxia, Inc., a manufacturer and supplier of flash memory","page_number":30,"box":{"x":265,"y":421,"width":631,"height":11}},{"id":"e8ba07ad-b759-4c3a-9cd8-250a3269181e","block_type":"box","text":"and solid state drives, and his long experience in the technology industry allow him to","page_number":30,"box":{"x":265,"y":436,"width":610,"height":11}},{"id":"b1465a88-db14-4817-8acd-9139ab31ee16","block_type":"box","text":"provide insight into financial, business and technology trends. Mr. Flores’s knowledge of","page_number":30,"box":{"x":265,"y":451,"width":629,"height":11}},{"id":"7b276364-48d8-43ef-9136-44b6b1b713cf","block_type":"box","text":"financial and accounting matters qualifies him to serve as Chair of the Audit Committee.","page_number":30,"box":{"x":264,"y":466,"width":630,"height":11}},{"id":"7e8c4ffa-62aa-4663-9c8d-fcbb61c5ef7d","block_type":"box","text":"Mr. Flores’s independence from the Fund and the Manager enhances his service as a","page_number":30,"box":{"x":265,"y":481,"width":610,"height":11}},{"id":"f780fe14-f967-4687-93e8-18c28dbea7fb","block_type":"box","text":"member of the Per formance Oversight Committee.","page_number":30,"box":{"x":265,"y":496,"width":358,"height":12}},{"id":"84edb496-844e-45de-9ae4-2105037daafb","block_type":"box","text":"Stayce D. Harris The Board benefits from Stayce D. Harris’s leadership and governance experience gained","page_number":30,"box":{"x":69,"y":519,"width":832,"height":11}},{"id":"8f0c0820-4cd3-4eb7-bc97-cff1faf0bfea","block_type":"box","text":"during her extensive military career, including as a three-star Lieutenant General of the","page_number":30,"box":{"x":265,"y":534,"width":617,"height":11}},{"id":"9ec8ae39-9fc3-424f-8bd3-a8805fc8d19a","block_type":"box","text":"United States Air Force. In her most recent role, Ms. Harris repor ted to the Secretary and","page_number":30,"box":{"x":265,"y":549,"width":637,"height":11}},{"id":"a00f1b96-fd18-4c84-829e-2394ec741557","block_type":"box","text":"Chief of Staff of the Air Force on matters concerning Air Force effectiveness, efficiency","page_number":30,"box":{"x":265,"y":564,"width":617,"height":12}},{"id":"78c4f2be-2d17-4436-a3b3-e10ad1c9ec4e","block_type":"box","text":"and the military discipline of active duty, Air Force Reserve and Air National Guard forces.","page_number":30,"box":{"x":265,"y":579,"width":635,"height":12}},{"id":"9f5e2fd9-4a6e-4f8e-9a3e-ec8b31dd2803","block_type":"box","text":"Ms. Harris’s experience on governance matters includes oversight of inspection policy and","page_number":30,"box":{"x":265,"y":595,"width":643,"height":11}},{"id":"3326bd82-88b0-4ac8-912a-6779dbe792a3","block_type":"box","text":"the inspection and evaluation system for all Air Force nuclear and conventional forces;","page_number":30,"box":{"x":264,"y":610,"width":614,"height":11}},{"id":"74ef95c7-bc0d-4203-af42-4b14d7d0e584","block_type":"box","text":"oversight of Air Force counterintelligence operations and service on the Air Force","page_number":30,"box":{"x":265,"y":625,"width":573,"height":11}},{"id":"e653f83f-951a-40d9-8319-9e0fa9b37eab","block_type":"box","text":"Intelligence Oversight Panel; investigation of fraud, waste and abuse; and oversight of","page_number":30,"box":{"x":265,"y":640,"width":612,"height":11}},{"id":"a38a75b1-1f1e-4d79-988a-166c52248cd1","block_type":"box","text":"criminal investigations and complaints resolution programs. Ms. Harris is also a director","page_number":30,"box":{"x":264,"y":655,"width":630,"height":11}},{"id":"031f31fe-eeaf-4082-9397-6e2c740903fb","block_type":"box","text":"of The Boeing Company. Ms. Harris’s independence from the Fund and the Manager","page_number":30,"box":{"x":265,"y":670,"width":599,"height":11}},{"id":"38a98383-947a-4de4-9404-902f03fa857d","block_type":"box","text":"enhances her service as a member of the Compliance Committee and the Per formance","page_number":30,"box":{"x":265,"y":685,"width":623,"height":11}},{"id":"0044e859-c679-4221-8902-b48d19fce431","block_type":"box","text":"Oversight Committee.","page_number":30,"box":{"x":265,"y":700,"width":151,"height":12}},{"id":"64e0225b-3d7a-4d59-830e-579ab52e548a","block_type":"box","text":"J. Phillip Holloman The Board benefits from J. Phillip Holloman’s many years of business and leadership","page_number":30,"box":{"x":69,"y":723,"width":800,"height":11}},{"id":"f50200cb-e22f-4595-b1c0-55c70997a13e","block_type":"box","text":"experience as an executive, director and advisory board member of various public and","page_number":30,"box":{"x":265,"y":738,"width":612,"height":11}},{"id":"d37b43c5-9706-44e8-86cb-528e92b1cf74","block_type":"box","text":"private companies. In par ticular, Mr. Holloman’s service as Board Chairman of Vestis","page_number":30,"box":{"x":265,"y":753,"width":607,"height":11}},{"id":"0710fd62-f400-4358-a040-32dd12943554","block_type":"box","text":"Corporation, President and Chief Operating Officer of Cintas Corporation allows him to","page_number":30,"box":{"x":265,"y":768,"width":612,"height":12}},{"id":"31f99192-780f-4fa1-bcb6-63ef8ea12775","block_type":"box","text":"provide insight into business trends and conditions. Mr. Holloman’s knowledge of","page_number":30,"box":{"x":265,"y":783,"width":581,"height":12}},{"id":"9b9fc04e-dd5d-45bd-b1ef-85a0cda927ad","block_type":"box","text":"financial and accounting matters qualifies him to serve as a member of the Audit","page_number":30,"box":{"x":264,"y":799,"width":579,"height":11}},{"id":"1d8d513e-f5ed-4a5b-8fba-555b4f9d2c28","block_type":"box","text":"Committee. Mr. Holloman’s independence from the Fund and the Manager enhances his","page_number":30,"box":{"x":265,"y":814,"width":629,"height":11}},{"id":"e93821f9-ea26-4f7e-a773-d05a12cab7bd","block_type":"box","text":"service as a member of the Governance and Nominating Committee and the Per formance","page_number":30,"box":{"x":265,"y":829,"width":639,"height":11}},{"id":"6fce1f88-7b82-4d1f-ac5d-b8698da4418f","block_type":"box","text":"Oversight Committee.","page_number":30,"box":{"x":265,"y":844,"width":151,"height":11}},{"id":"c3ac926f-291c-4664-945a-30298f024db7","block_type":"box","text":"I-14","page_number":30,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"065ab5f4-f13d-4646-bdc9-e56eac98283e","block_type":"box","text":"NM1026U-6033063-30/246","page_number":30,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"83048adc-0302-4ff0-9127-ef75c8617ff5","block_type":"box","text":"Directors Experience, Qualifications and Skills","page_number":31,"box":{"x":69,"y":49,"width":408,"height":9}},{"id":"da97b204-aa5b-47db-b548-e801010214f0","block_type":"box","text":"Ar thur P. Steinmetz The Board benefits from Ar thur P. Steinmetz’s many years of business and leadership","page_number":31,"box":{"x":68,"y":65,"width":808,"height":12}},{"id":"0bf0cf07-260c-4e1d-9a86-b235b27eecd8","block_type":"box","text":"experience as an executive, chairman and director of various companies in the financial","page_number":31,"box":{"x":265,"y":81,"width":624,"height":11}},{"id":"f2c174ea-2250-4944-a44c-c9b18a60f512","block_type":"box","text":"industry. Mr. Steinmetz’s service as Chairman, Chief Executive Officer and President of","page_number":31,"box":{"x":265,"y":96,"width":622,"height":11}},{"id":"21eb3378-45a6-410e-963c-c96e8fe46fed","block_type":"box","text":"the OppenheimerFunds, Inc. and as Trustee, President and Principal Executive Officer of","page_number":31,"box":{"x":264,"y":111,"width":629,"height":11}},{"id":"653051b2-6207-4a73-8817-ea7e73615235","block_type":"box","text":"cer tain OppenheimerFunds funds provides insight into the asset management industry.","page_number":31,"box":{"x":264,"y":126,"width":621,"height":11}},{"id":"b322e553-7a69-4533-9d60-58bdec24fe50","block_type":"box","text":"He has also served as a Director of ScotiaBank (U.S.). Mr. Steinmetz’s knowledge of","page_number":31,"box":{"x":265,"y":141,"width":604,"height":11}},{"id":"0f6ca71d-dbc0-4c00-b455-12a7e44e8f26","block_type":"box","text":"financial and accounting matters qualifies him to serve as a member of the Audit","page_number":31,"box":{"x":264,"y":156,"width":579,"height":11}},{"id":"badc6475-bd03-440b-89e9-bbd3b6d6c4f7","block_type":"box","text":"Committee. Mr. Steinmetz’s independence from the Fund and the Manager enhances his","page_number":31,"box":{"x":265,"y":171,"width":632,"height":12}},{"id":"47b1d68e-f3e2-44b8-bd19-730c7aff2418","block_type":"box","text":"service as Chair of the Per formance Oversight Committee.","page_number":31,"box":{"x":265,"y":186,"width":415,"height":12}},{"id":"9ee105b2-a7ba-45ae-a2a8-b8633cc55d0f","block_type":"box","text":"Interested Directors","page_number":31,"box":{"x":70,"y":209,"width":140,"height":9}},{"id":"0c56a854-ec7b-471c-83f3-8a6525dbda98","block_type":"box","text":"Rober t Fairbairn Rober t Fairbairn has more than 25 years of experience with BlackRock, Inc. and over 30","page_number":31,"box":{"x":70,"y":224,"width":823,"height":11}},{"id":"6c9cca28-aaba-4191-a665-43954def6426","block_type":"box","text":"years of experience in finance and asset management. In par ticular, Mr. Fairbairn’s","page_number":31,"box":{"x":264,"y":239,"width":593,"height":12}},{"id":"fc091263-4dee-4f5e-a9a5-7aeb1b534611","block_type":"box","text":"positions as Vice Chairman of BlackRock, Inc., Member of BlackRock’s Global Operating","page_number":31,"box":{"x":265,"y":254,"width":629,"height":12}},{"id":"18364d92-9e82-4141-8ad4-add4aaaeabd2","block_type":"box","text":"Committee and Co-Chair of BlackRock’s Human Capital Committee provide the Board with","page_number":31,"box":{"x":265,"y":269,"width":639,"height":11}},{"id":"8c636584-2156-4f70-b4bc-7f4043893289","block_type":"box","text":"a wealth of practical business knowledge and leadership. In addition, Mr. Fairbairn has","page_number":31,"box":{"x":265,"y":285,"width":617,"height":11}},{"id":"4397ea3e-156c-433c-86e0-22771ca7c874","block_type":"box","text":"global investment management and oversight experience through his former positions as","page_number":31,"box":{"x":264,"y":300,"width":634,"height":11}},{"id":"bc97b9f3-d25d-47c4-9223-f458ea928f6e","block_type":"box","text":"a Member of BlackRock’s Global Executive Committee, Global Head of BlackRock’s Retail","page_number":31,"box":{"x":265,"y":315,"width":637,"height":10}},{"id":"a2875178-4e5b-429e-9697-5d6f393c974f","block_type":"box","text":"and iShares","page_number":31,"box":{"x":265,"y":330,"width":84,"height":9}},{"id":"c197e09f-80f8-4208-98d9-c2bebaec0fbe","block_type":"box","text":"®","page_number":31,"box":{"x":350,"y":330,"width":6,"height":5}},{"id":"7baf21e8-1597-4032-bd27-78c56a4a8712","block_type":"box","text":"businesses, Head of BlackRock’s Global Client Group, Chairman of","page_number":31,"box":{"x":362,"y":330,"width":478,"height":11}},{"id":"cdef9622-f6d5-4c7c-b7ea-942172207c53","block_type":"box","text":"BlackRock’s international businesses and his previous oversight over BlackRock’s","page_number":31,"box":{"x":265,"y":345,"width":585,"height":11}},{"id":"8154238c-8d4c-4ef8-a3f7-2f5a84e0073a","block_type":"box","text":"Strategic Par tner Program and Strategic Product Management Group. Mr. Fairbairn also","page_number":31,"box":{"x":265,"y":360,"width":620,"height":12}},{"id":"2206b9c9-3521-4c0c-9c92-2a160f388064","block_type":"box","text":"serves as a board member for the funds in the BlackRock Multi-Asset Complex.","page_number":31,"box":{"x":265,"y":375,"width":565,"height":11}},{"id":"6f0daddb-562a-4070-bf75-8453c1239076","block_type":"box","text":"John M. Perlowski John M. Perlowski’s experience as Managing Director of BlackRock, Inc. since 2009, as","page_number":31,"box":{"x":69,"y":398,"width":821,"height":11}},{"id":"9270d086-bc54-41f0-97ef-08f1955b95f5","block_type":"box","text":"the Head of BlackRock Global Accounting and Product Services since 2009, and as","page_number":31,"box":{"x":264,"y":413,"width":595,"height":11}},{"id":"8f21ec6c-83cc-4c28-ad08-ff1b3efae643","block_type":"box","text":"President and Chief Executive Officer of the Fund provides him with a strong","page_number":31,"box":{"x":265,"y":428,"width":542,"height":12}},{"id":"03e83e6a-21da-485e-baed-04be1060ae3d","block_type":"box","text":"understanding of the Fund, its operations, and the business and regulatory issues facing","page_number":31,"box":{"x":265,"y":443,"width":634,"height":12}},{"id":"0034b701-a57f-48f0-8580-300bb9f284d9","block_type":"box","text":"the Fund. 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In addition, the Chair of the","page_number":34,"box":{"x":69,"y":899,"width":838,"height":11}},{"id":"eae6d7e1-cab5-479f-80a4-7745e7f29dd1","block_type":"box","text":"I-18","page_number":34,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"36716289-5d89-4bda-b6aa-3e179aa0b682","block_type":"box","text":"NM1026U-6033063-34/246","page_number":34,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"dbddd49d-2b56-4222-b70e-9e2ee1ad69b6","block_type":"box","text":"Board and the Vice Chair of the Board are paid an additional annual retainer of $140,000 and $84,000, respectively.","page_number":35,"box":{"x":70,"y":44,"width":835,"height":12}},{"id":"bd0b461b-c9fe-4df3-b1f1-689a381d5a70","block_type":"box","text":"The Chairs of the Audit Committee, Per formance Oversight Committee, Compliance Committee, Governance and","page_number":35,"box":{"x":68,"y":60,"width":801,"height":11}},{"id":"dc05d1e2-2fa7-40a1-88b6-cf6660eda1d1","block_type":"box","text":"Nominating Committee, and Securities Lending Committee are paid an additional annual retainer of $55,000,","page_number":35,"box":{"x":70,"y":74,"width":780,"height":12}},{"id":"4dc4c712-de1b-47ad-84ab-e37946103372","block_type":"box","text":"$42,500, $50,000, $42,500 and $20,000, respectively. Each of the other members of the Audit Committee,","page_number":35,"box":{"x":69,"y":89,"width":779,"height":12}},{"id":"5955aa3a-3381-476a-a46e-347ccda5a08a","block_type":"box","text":"Compliance Committee, Governance and Nominating Committee, and Securities Lending Committee are paid an","page_number":35,"box":{"x":69,"y":105,"width":798,"height":11}},{"id":"472b2e06-1440-401e-9945-ad3127af58b4","block_type":"box","text":"additional annual retainer of $30,000, $25,000, $25,000 and $15,000, respectively, for his or her service on such","page_number":35,"box":{"x":69,"y":120,"width":826,"height":11}},{"id":"2d57fdaf-6526-4974-8809-13d9187bba39","block_type":"box","text":"committee. An Independent Director may receive additional compensation for his or her service as a member or","page_number":35,"box":{"x":69,"y":135,"width":797,"height":11}},{"id":"0f4bd05a-0f63-45cd-95cf-8210e8c31dc9","block_type":"box","text":"Chair, as applicable, of one or more ad hoc committees of the Board. The Fund will pay a pro rata por tion quar terly","page_number":35,"box":{"x":69,"y":150,"width":819,"height":12}},{"id":"a893b1d4-fb21-4f6d-b674-21c79074f8ba","block_type":"box","text":"(based on relative net assets) of the foregoing Director fees paid by the funds in the BlackRock Fixed-Income","page_number":35,"box":{"x":69,"y":166,"width":775,"height":11}},{"id":"f021e177-e1f9-4c80-864a-d304d400badf","block_type":"box","text":"Complex.","page_number":35,"box":{"x":69,"y":181,"width":64,"height":11}},{"id":"405e73a5-9bed-427f-a1e9-a698e0bcb8b1","block_type":"box","text":"The Independent Directors have agreed that a maximum of 50% of each Independent Director’s total","page_number":35,"box":{"x":101,"y":203,"width":717,"height":12}},{"id":"18ce2218-df1d-441f-afdd-a794a133fb82","block_type":"box","text":"compensation paid by funds in the BlackRock Fixed-Income Complex may be deferred pursuant to the BlackRock","page_number":35,"box":{"x":69,"y":218,"width":801,"height":12}},{"id":"8e4541f0-8d1c-4b9d-9c56-df8bb44ed9fb","block_type":"box","text":"Fixed-Income Complex’s deferred compensation plan. Under the deferred compensation plan, deferred amounts earn","page_number":35,"box":{"x":70,"y":234,"width":833,"height":11}},{"id":"4c4fc05f-ca84-46e9-add5-0da57fd4a213","block_type":"box","text":"a return for the Independent Directors as though equivalent dollar amounts had been invested in shares of cer tain","page_number":35,"box":{"x":69,"y":249,"width":815,"height":11}},{"id":"9a45dbf0-d23b-499a-8f7d-92febb0ff397","block_type":"box","text":"funds in the BlackRock Fixed-Income Complex selected by the Independent Directors. This has approximately the","page_number":35,"box":{"x":68,"y":264,"width":804,"height":11}},{"id":"6f6f69a8-a8ff-45fc-a5c6-475d134c036b","block_type":"box","text":"same economic effect for the Independent Directors as if they had invested the deferred amounts in such funds in","page_number":35,"box":{"x":69,"y":279,"width":817,"height":11}},{"id":"007b7b03-14cc-4859-98fa-959f1d401225","block_type":"box","text":"the BlackRock Fixed-Income Complex. The deferred compensation plan is not funded and obligations thereunder","page_number":35,"box":{"x":68,"y":294,"width":800,"height":11}},{"id":"9f178486-df98-41b1-b8f4-e9a23f57bba3","block_type":"box","text":"represent general unsecured claims against the general assets of a fund and are recorded as a liability for","page_number":35,"box":{"x":69,"y":309,"width":760,"height":11}},{"id":"708724a5-403c-4a38-af1d-9753a06239cc","block_type":"box","text":"accounting purposes.","page_number":35,"box":{"x":69,"y":325,"width":151,"height":11}},{"id":"dae8a367-f316-44d0-aa20-ec75a2ffc494","block_type":"box","text":"The following table sets for th the compensation paid to the Directors by the Master LLC, on behalf of the Fund,","page_number":35,"box":{"x":101,"y":347,"width":792,"height":11}},{"id":"5192c702-b569-4c04-ab09-f728fabad8d0","block_type":"box","text":"for the fiscal year ended September 30, 2025, and the aggregate compensation, including deferred compensation","page_number":35,"box":{"x":68,"y":362,"width":816,"height":11}},{"id":"be0491f6-8b7e-4e3b-9886-f8c6b6f19ad3","block_type":"box","text":"amounts, paid to them by all BlackRock-advised Funds for the calendar year ended December 31, 2025. Prior to","page_number":35,"box":{"x":69,"y":377,"width":800,"height":11}},{"id":"e7faab28-629b-452f-94b0-45f7f472908e","block_type":"box","text":"September 16, 2024, the Fund invested all of its assets in the Master Por tfolio, a series of the Master LLC, as par t","page_number":35,"box":{"x":69,"y":392,"width":829,"height":11}},{"id":"00acb449-4ffb-402d-b204-19161a64c293","block_type":"box","text":"of a “master/feeder” structure, and the Master LLC, on behalf of the Fund, paid compensation to the Directors for","page_number":35,"box":{"x":69,"y":407,"width":816,"height":11}},{"id":"35690c9e-33f3-44d8-9874-b5e25ab0446e","block_type":"box","text":"their services as board members. Prior to September 16, 2024, the Directors did not receive additional","page_number":35,"box":{"x":68,"y":423,"width":739,"height":11}},{"id":"1d5e63a1-0df2-456e-bb3e-0c89e0d11ba0","block_type":"box","text":"compensation from the Corporation on behalf of the Fund.","page_number":35,"box":{"x":69,"y":438,"width":412,"height":11}},{"id":"7ec3ac49-63d6-4d0b-93b1-01c5a0f89140","block_type":"box","text":"Name","page_number":35,"box":{"x":69,"y":527,"width":32,"height":7}},{"id":"b9e2583e-3dcc-49a5-8489-516ac8f71296","block_type":"box","text":"1","page_number":35,"box":{"x":102,"y":527,"width":4,"height":3}},{"id":"7f9214e4-1f9d-43bb-bcfb-c216f89cdabd","block_type":"box","text":"Compensation","page_number":35,"box":{"x":593,"y":506,"width":83,"height":9}},{"id":"746b8273-1a7e-4c37-b31e-3f9b5576df41","block_type":"box","text":"from the","page_number":35,"box":{"x":610,"y":516,"width":49,"height":8}},{"id":"505fd62f-d82e-4de9-baa1-d726dcdcdb58","block_type":"box","text":"Fund","page_number":35,"box":{"x":621,"y":527,"width":27,"height":7}},{"id":"81fb3529-2348-418d-8ba7-85f2e0cc7e77","block_type":"box","text":"Estimated","page_number":35,"box":{"x":717,"y":496,"width":58,"height":7}},{"id":"d7a495a3-64d5-4dc0-9067-63a2cbafa4eb","block_type":"box","text":"Annual","page_number":35,"box":{"x":726,"y":506,"width":39,"height":7}},{"id":"d32eb374-2bff-41fc-9c0d-04ea0f236507","block_type":"box","text":"Benefits upon","page_number":35,"box":{"x":706,"y":516,"width":80,"height":9}},{"id":"2bb5cf7a-267b-418c-ad0c-bd46df35d6fc","block_type":"box","text":"Retirement","page_number":35,"box":{"x":714,"y":527,"width":64,"height":7}},{"id":"8e6c44e7-d97e-4b04-88c1-b66570ad386a","block_type":"box","text":"Aggregate","page_number":35,"box":{"x":832,"y":466,"width":61,"height":9}},{"id":"9e54d312-000c-437b-a70c-9e7c3707f618","block_type":"box","text":"Compensation","page_number":35,"box":{"x":821,"y":476,"width":83,"height":9}},{"id":"9be647da-2924-42bb-a1ec-59a184e1abfd","block_type":"box","text":"from the","page_number":35,"box":{"x":838,"y":486,"width":49,"height":7}},{"id":"461c0e5c-a381-48cb-9d4f-323b56eba565","block_type":"box","text":"Fund","page_number":35,"box":{"x":849,"y":496,"width":27,"height":7}},{"id":"dcf297ee-b5b5-4518-994d-d517ecd89d26","block_type":"box","text":"and Other","page_number":35,"box":{"x":834,"y":506,"width":57,"height":7}},{"id":"2e17fd6e-5119-42dc-886d-e1908b74c00c","block_type":"box","text":"BlackRock","page_number":35,"box":{"x":830,"y":517,"width":66,"height":7}},{"id":"89296fad-7c0b-425e-a58f-4b78adf5d928","block_type":"box","text":"Advised Funds","page_number":35,"box":{"x":816,"y":527,"width":83,"height":7}},{"id":"310bb230-85c4-4ae0-92f4-2e570dc8fbdc","block_type":"box","text":"2,3","page_number":35,"box":{"x":900,"y":527,"width":9,"height":4}},{"id":"348bdaef-3186-4392-8592-c5c21bfedfd7","block_type":"box","text":"Independent Directors","page_number":35,"box":{"x":70,"y":544,"width":156,"height":11}},{"id":"9329acc8-304a-4490-b9bf-7b7d75c8ef9e","block_type":"box","text":"Cynthia L. Egan","page_number":35,"box":{"x":79,"y":559,"width":108,"height":12}},{"id":"2763221a-8c22-4e46-8eae-ce7800225868","block_type":"box","text":"4","page_number":35,"box":{"x":189,"y":560,"width":4,"height":4}},{"id":"bd7d1638-43ec-44e8-af6e-c7e4e25dc148","block_type":"box","text":".............................................","page_number":35,"box":{"x":202,"y":567,"width":360,"height":1}},{"id":"11c56ae4-4687-4b61-bb8e-81a6bee922e7","block_type":"box","text":"$32,487 None $580,000","page_number":35,"box":{"x":604,"y":559,"width":295,"height":11}},{"id":"cf26d051-6e21-4b3f-aa57-2658c6d42023","block_type":"box","text":"Lorenzo A. Flores","page_number":35,"box":{"x":79,"y":575,"width":121,"height":8}},{"id":"59dc57e8-7349-4ae4-9446-6d8f47612d83","block_type":"box","text":"5","page_number":35,"box":{"x":201,"y":575,"width":4,"height":4}},{"id":"bb08aadf-3135-4260-b0c1-8750d99d77d3","block_type":"box","text":"............................................","page_number":35,"box":{"x":210,"y":582,"width":352,"height":1}},{"id":"1fa6d6f6-83eb-413f-9d38-287f9531b69c","block_type":"box","text":"$26,027 None $400,000","page_number":35,"box":{"x":604,"y":574,"width":295,"height":11}},{"id":"45c67dcc-f199-4325-a48e-6c6e969972bb","block_type":"box","text":"Stayce D. Harris . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .","page_number":35,"box":{"x":79,"y":590,"width":483,"height":11}},{"id":"0eecbcff-617c-44b8-85c1-bc456dc05299","block_type":"box","text":"$24,417 None $395,000","page_number":35,"box":{"x":604,"y":589,"width":295,"height":11}},{"id":"5f1c08b0-a3f6-4547-af01-c13b3a5342ca","block_type":"box","text":"J. Phillip Holloman","page_number":35,"box":{"x":78,"y":605,"width":130,"height":11}},{"id":"caab3ba6-9fbd-4cf7-ac7f-76f9b261bff4","block_type":"box","text":"...........................................","page_number":35,"box":{"x":218,"y":612,"width":344,"height":2}},{"id":"668a5b08-d6ec-4a54-a9e7-c8c8ddc27b56","block_type":"box","text":"$26,349 None $425,000","page_number":35,"box":{"x":604,"y":604,"width":295,"height":11}},{"id":"8f30775b-c298-4650-b5b8-f3221d6f4b9c","block_type":"box","text":"R. Glenn Hubbard","page_number":35,"box":{"x":79,"y":620,"width":124,"height":9}},{"id":"b34cd843-7bfb-4ef6-babe-1a13c4e6fd79","block_type":"box","text":"............................................","page_number":35,"box":{"x":210,"y":627,"width":352,"height":2}},{"id":"7dcdb621-cffd-467d-b38a-3bca2bf7080a","block_type":"box","text":"$36,331 None $560,000","page_number":35,"box":{"x":604,"y":619,"width":295,"height":11}},{"id":"0deee30b-f718-4a2e-9453-d351a8d55cef","block_type":"box","text":"W. Carl Kester","page_number":35,"box":{"x":78,"y":635,"width":102,"height":9}},{"id":"fa753c19-d42c-4b27-8f6c-c2b9298db0c8","block_type":"box","text":"...............................................","page_number":35,"box":{"x":185,"y":642,"width":377,"height":2}},{"id":"a020e785-7813-4a85-9cbe-ead04eae782f","block_type":"box","text":"$37,413 None $671,500","page_number":35,"box":{"x":604,"y":634,"width":295,"height":11}},{"id":"1569d3a8-5f4f-4229-b36e-d842a8e9d9df","block_type":"box","text":"Catherine A. Lynch","page_number":35,"box":{"x":79,"y":650,"width":131,"height":11}},{"id":"99df06ce-3a68-4a0f-a166-de1320ddfdd4","block_type":"box","text":"6","page_number":35,"box":{"x":211,"y":650,"width":5,"height":5}},{"id":"89103a13-eed4-422c-9892-66016b8a09e5","block_type":"box","text":"...........................................","page_number":35,"box":{"x":218,"y":657,"width":344,"height":2}},{"id":"3cd70b2e-3b0d-41c8-91db-78226e23a7e4","block_type":"box","text":"$33,699 None $610,000","page_number":35,"box":{"x":604,"y":649,"width":295,"height":11}},{"id":"cb6f13fe-c569-47b0-89ff-6585009df33c","block_type":"box","text":"Ar thur P. Steinmetz. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .","page_number":35,"box":{"x":78,"y":665,"width":484,"height":9}},{"id":"d2ca33c9-81dc-45df-9cf6-d82cebdf64a7","block_type":"box","text":"$28,462 None $537,500","page_number":35,"box":{"x":604,"y":664,"width":295,"height":12}},{"id":"47198407-3062-4831-b5f9-a61ee89131f3","block_type":"box","text":"Interested Directors","page_number":35,"box":{"x":70,"y":680,"width":140,"height":9}},{"id":"66de5fa7-c82e-48b4-8c70-a0d3f653d20f","block_type":"box","text":"Rober t Fairbairn . . .","page_number":35,"box":{"x":79,"y":696,"width":141,"height":8}},{"id":"d9957647-c22c-4644-a0fb-36e78c954344","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . None","page_number":35,"box":{"x":226,"y":696,"width":426,"height":8}},{"id":"c849bd50-7d78-44d7-aab0-f54ef60d9759","block_type":"box","text":"None None","page_number":35,"box":{"x":729,"y":696,"width":151,"height":8}},{"id":"52026535-0c4b-4b69-9aa7-e790c6a12f9d","block_type":"box","text":"John M. Perlowski","page_number":35,"box":{"x":78,"y":711,"width":127,"height":8}},{"id":"92106e5d-fd66-4bba-b327-afcf400fd4c7","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . None","page_number":35,"box":{"x":210,"y":711,"width":442,"height":8}},{"id":"1ef2ff66-8fe8-4a29-a82e-3df5fbdea7f7","block_type":"box","text":"None None","page_number":35,"box":{"x":729,"y":711,"width":151,"height":8}},{"id":"bb36afe7-a730-4856-8904-471446053e8a","block_type":"box","text":"1","page_number":35,"box":{"x":69,"y":735,"width":3,"height":4}},{"id":"80e95991-35c9-4d22-834a-157634888ba6","block_type":"box","text":"For the number of BlackRock-advised Funds from which each Director receives compensation, see “Biographical Information” beginning on","page_number":35,"box":{"x":94,"y":735,"width":788,"height":9}},{"id":"bc2a7e47-3fce-469d-b7ea-7ca6f30a884e","block_type":"box","text":"page I-15.","page_number":35,"box":{"x":94,"y":745,"width":55,"height":9}},{"id":"b6dfcf8c-fa43-465c-9a14-62149b030665","block_type":"box","text":"2","page_number":35,"box":{"x":69,"y":758,"width":3,"height":3}},{"id":"2118ee86-4516-43d5-97f9-1827938b1adf","block_type":"box","text":"For the Independent Directors, this amount represents the aggregate compensation earned by such persons from the funds in the BlackRock","page_number":35,"box":{"x":94,"y":758,"width":804,"height":9}},{"id":"3192a33e-608c-4db6-8160-44d2964dc915","block_type":"box","text":"Fixed-Income Complex during the calendar year ended December 31, 2025. Of this amount, Mr. Flores, Ms. Harris, Mr. Holloman, Dr. Hubbard,","page_number":35,"box":{"x":94,"y":768,"width":813,"height":9}},{"id":"6be7d707-c54f-4d26-ae7f-af81299da172","block_type":"box","text":"Dr. Kester, Ms. Lynch and Mr. Steinmetz deferred $200,000, $197,500, $212,500, $280,000, $546,859, $603,900, and $268,750,","page_number":35,"box":{"x":94,"y":777,"width":770,"height":10}},{"id":"d4a5280c-0aef-4991-97c3-5e562218a74d","block_type":"box","text":"respectively, pursuant to the BlackRock Fixed-Income Complex’s deferred compensation plan.","page_number":35,"box":{"x":94,"y":788,"width":531,"height":9}},{"id":"8771dce2-3789-47c7-b4ea-5415e749c66d","block_type":"box","text":"3","page_number":35,"box":{"x":69,"y":801,"width":3,"height":3}},{"id":"70b814f0-1581-41fd-8407-c2521f7f6986","block_type":"box","text":"Total amount of deferred compensation payable by the BlackRock Fixed-Income Complex to Mr. Flores, Ms. Harris, Mr. Holloman, Dr. Hubbard,","page_number":35,"box":{"x":93,"y":800,"width":810,"height":9}},{"id":"b0b53563-7e95-4ed6-9126-03f86b1b7bb8","block_type":"box","text":"Dr. Kester, Ms. Lynch and Mr. Steinmetz is $1,055,218, $1,032,387, $1,101,752, $5,907,215, $2,544,830, $720,927 and $603,379,","page_number":35,"box":{"x":94,"y":810,"width":787,"height":9}},{"id":"1b2f0305-e3cc-42f0-b260-7b7e7271b960","block_type":"box","text":"respectively, as of December 31, 2025. Ms. Egan did not par ticipate in the deferred compensation plan as of December 31, 2025.","page_number":35,"box":{"x":94,"y":821,"width":748,"height":9}},{"id":"ff177008-3232-43ec-8974-b67691ff2ff4","block_type":"box","text":"4","page_number":35,"box":{"x":68,"y":833,"width":4,"height":4}},{"id":"793f998c-800a-4b6d-8096-b1fdcee31ac8","block_type":"box","text":"Ms. Egan became Chair of the Securities Lending Committee effective as of March 9, 2026.","page_number":35,"box":{"x":94,"y":838,"width":525,"height":9}},{"id":"7e10cbed-bc10-47ac-860c-307f9fdf0fc2","block_type":"box","text":"5","page_number":35,"box":{"x":69,"y":851,"width":3,"height":4}},{"id":"f6134ee0-073d-4e87-80fd-a677809f35f7","block_type":"box","text":"Mr. Flores became Chair of the Audit Committee effective as of March 9, 2026.","page_number":35,"box":{"x":94,"y":856,"width":452,"height":8}},{"id":"3a404b38-f3fb-4ea6-b480-f3feec31dd57","block_type":"box","text":"6","page_number":35,"box":{"x":69,"y":869,"width":3,"height":3}},{"id":"6ce58d6c-51e3-44f7-905d-a24eb71c2996","block_type":"box","text":"Ms. Lynch resigned as a Director of the Corporation effective as of March 9, 2026.","page_number":35,"box":{"x":94,"y":873,"width":472,"height":10}},{"id":"882f769a-1ad0-4695-bcb0-66820c99ea1c","block_type":"box","text":"I-19","page_number":35,"box":{"x":476,"y":943,"width":26,"height":9}},{"id":"add72693-7c8c-4174-85ab-02353a53f6d9","block_type":"box","text":"NM1026U-6033063-35/246","page_number":35,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"ea3444d6-1f09-4cc2-92c1-bf3fe659fd83","block_type":"box","text":"IV. Management, Advisory and Other Service Arrangements","page_number":36,"box":{"x":69,"y":45,"width":432,"height":11}},{"id":"e0b1ef91-485b-4693-8789-c1550c7ed25f","block_type":"box","text":"Management Agreement","page_number":36,"box":{"x":69,"y":75,"width":180,"height":11}},{"id":"04984dae-20e9-40f8-98e4-b646328c2f59","block_type":"box","text":"The Corporation, on behalf of the Fund, each has entered into a management agreement with the Manager (the","page_number":36,"box":{"x":101,"y":98,"width":794,"height":11}},{"id":"73e7da1a-8d68-4e0c-b7c9-622f883c0100","block_type":"box","text":"“Management Agreement”) under which the Manager provides investment management and cer tain administrative","page_number":36,"box":{"x":70,"y":113,"width":815,"height":11}},{"id":"bc791c6e-fcb0-44b3-8a8c-165c29d87ce2","block_type":"box","text":"services. Pursuant to the Management Agreement, the Manager receives for its services to the Fund a monthly fee at","page_number":36,"box":{"x":69,"y":128,"width":840,"height":11}},{"id":"5d05ccfa-4304-4129-b9f8-c902c58d861e","block_type":"box","text":"an annual rate of the average daily net assets of the Fund. The Manager does not receive separate compensation","page_number":36,"box":{"x":69,"y":143,"width":811,"height":11}},{"id":"be6cc792-db07-46d6-a155-805e411c27ee","block_type":"box","text":"from the Fund for providing it with investment management or administrative services. Prior to September 16, 2024,","page_number":36,"box":{"x":68,"y":158,"width":831,"height":11}},{"id":"8a8ecf16-7fbb-4d3b-a7f5-8e9965f117f6","block_type":"box","text":"the Fund invested all of its assets in the Master Por tfolio, a series of the Master LLC, that had the same investment","page_number":36,"box":{"x":68,"y":173,"width":832,"height":11}},{"id":"9835fc8f-492c-4295-933d-9adbbf53b52b","block_type":"box","text":"objectives and strategies as the Fund. Accordingly, prior to September 16, 2024, the Fund did not invest directly in","page_number":36,"box":{"x":69,"y":188,"width":817,"height":12}},{"id":"ef28bb16-abba-45bf-8669-d8a823b5cace","block_type":"box","text":"por tfolio securities. All por tfolio management occurred at the Master Por tfolio level. The Master LLC, on behalf of the","page_number":36,"box":{"x":70,"y":203,"width":836,"height":12}},{"id":"de3c55d2-599f-4ba3-b002-c8f3e4cb71b2","block_type":"box","text":"Master Por tfolio, was par ty to a management agreement with the Manager pursuant to which the Manager provided","page_number":36,"box":{"x":70,"y":218,"width":823,"height":12}},{"id":"2b039487-3311-4070-8174-c973f0a86529","block_type":"box","text":"the Master LLC with investment advisory services with respect to the Master Por tfolio. Under the Management","page_number":36,"box":{"x":68,"y":234,"width":791,"height":11}},{"id":"051ecbe6-964b-49f1-8866-0ab7291dfa3a","block_type":"box","text":"Agreement, the administrative services provided by the Manager include, but are not limited to, the following:","page_number":36,"box":{"x":68,"y":249,"width":779,"height":11}},{"id":"622f1caf-c778-4896-ac22-044191eb5ba9","block_type":"box","text":"maintaining office facilities for the Fund; furnishing the Fund with clerical, bookkeeping and administrative services;","page_number":36,"box":{"x":69,"y":264,"width":823,"height":11}},{"id":"544622f9-6f02-401a-a52f-2329a001c137","block_type":"box","text":"overseeing the determination and publication of the Fund’s net asset value; overseeing the preparation and filing of","page_number":36,"box":{"x":69,"y":279,"width":825,"height":11}},{"id":"a1800ba8-c328-40ad-8277-199eca0546f8","block_type":"box","text":"Federal, state and local income tax returns; preparing cer tain repor ts required by regulatory authorities; calculating","page_number":36,"box":{"x":70,"y":294,"width":820,"height":11}},{"id":"ea9c75bc-697f-488c-8262-74bf3b1d504b","block_type":"box","text":"various contractual expenses; determining the amount of dividends and distributions available for payment by the","page_number":36,"box":{"x":68,"y":309,"width":809,"height":11}},{"id":"388511c4-78e1-46dc-81a3-4643ff5a50be","block_type":"box","text":"Fund to its shareholders; preparing and arranging for the printing of dividend notices to shareholders; providing the","page_number":36,"box":{"x":70,"y":324,"width":817,"height":12}},{"id":"786170b5-2767-4cef-8269-3d8a904f91c4","block_type":"box","text":"Fund’s service providers with such information as is required to effect the payment of dividends and distributions;","page_number":36,"box":{"x":70,"y":339,"width":812,"height":12}},{"id":"5227123d-5196-4bf8-9071-8537145ec3ca","block_type":"box","text":"and serving as liaison with the Corporation’s officers, independent accountants, legal counsel, custodian, accounting","page_number":36,"box":{"x":69,"y":355,"width":837,"height":11}},{"id":"e967cbff-ef9f-4dee-99ad-0fd8a46fa5b4","block_type":"box","text":"agent and transfer and dividend disbursing agent in establishing the accounting policies of each entity and monitoring","page_number":36,"box":{"x":69,"y":370,"width":839,"height":11}},{"id":"20dca765-eb40-4c78-951a-1982969ba2db","block_type":"box","text":"financial and shareholder accounting services.","page_number":36,"box":{"x":68,"y":385,"width":331,"height":11}},{"id":"87b7eaa2-e933-485d-b083-dec0b5aef4a6","block_type":"box","text":"On September 16, 2024, the Fund ceased to invest in Master Total Return Por tfolio (the “Master Por tfolio”), a","page_number":36,"box":{"x":102,"y":407,"width":787,"height":11}},{"id":"353564df-d6fc-43dd-8a38-c8e1c2212c74","block_type":"box","text":"series of Master Bond LLC (the “Master LLC”) as par t of a “master/feeder” structure and instead operates as a","page_number":36,"box":{"x":69,"y":423,"width":801,"height":11}},{"id":"ef6d06cd-98cc-4d1f-bd49-e587c73b1bd5","block_type":"box","text":"stand-alone fund. In connection with this change and in accordance with the investment advisory agreement, the","page_number":36,"box":{"x":69,"y":438,"width":802,"height":11}},{"id":"d3e28c9f-cecc-4b3f-a2af-9808d0ac69c6","block_type":"box","text":"Fund now pays a monthly fee at an annual rate equal to the following percentages of the average daily value of the","page_number":36,"box":{"x":70,"y":453,"width":815,"height":11}},{"id":"623430df-38a2-45ec-b9ef-abf3b89fa568","block_type":"box","text":"Fund’s net assets: 0.48% (first $250 million), 0.43% ($250 million - $500 million), 0.38% ($500 million -","page_number":36,"box":{"x":70,"y":467,"width":749,"height":12}},{"id":"30e8ee20-8e33-4a01-bbf8-38408c133c49","block_type":"box","text":"$750 million) and 0.34% (greater than $750 million).","page_number":36,"box":{"x":69,"y":482,"width":377,"height":12}},{"id":"795e79a5-3857-4922-a6cb-0c95b462ee61","block_type":"box","text":"Under the Management Agreement, BlackRock receives for its services to the Fund a fee as a percentage of","page_number":36,"box":{"x":102,"y":506,"width":773,"height":11}},{"id":"3571cce4-6a43-49ee-bb4f-e9928d5891a5","block_type":"box","text":"average daily net assets.","page_number":36,"box":{"x":69,"y":521,"width":176,"height":11}},{"id":"7a96fe95-bcbf-4869-bd81-38f9fe162274","block_type":"box","text":"BlackRock has contractually agreed to waive the management fee of the Fund with respect to any por tion of the","page_number":36,"box":{"x":102,"y":543,"width":795,"height":12}},{"id":"4839869d-a11e-43ea-9fe7-688aba1edc19","block_type":"box","text":"Fund’s assets estimated to be attributable to investments in other equity and fixed-income mutual funds and","page_number":36,"box":{"x":70,"y":559,"width":774,"height":11}},{"id":"936ead47-eb18-4022-84b5-4db1702fc349","block_type":"box","text":"exchange-traded funds managed by BlackRock or its affiliates that have a contractual management fee, through","page_number":36,"box":{"x":69,"y":574,"width":796,"height":11}},{"id":"c4a5fd45-31bd-4d12-864c-818c1d732e3f","block_type":"box","text":"June 30, 2027. In addition, BlackRock has contractually agreed to waive its management fees by the amount of","page_number":36,"box":{"x":69,"y":589,"width":799,"height":11}},{"id":"977ceadc-e387-4e29-8b84-ba6b4c48ca5f","block_type":"box","text":"investment advisory fees the Fund pays to BlackRock indirectly through its investment in money market funds","page_number":36,"box":{"x":70,"y":604,"width":780,"height":11}},{"id":"04a82942-55fc-4e80-a13b-8b0f6788f7d0","block_type":"box","text":"managed by BlackRock or its affiliates, through June 30, 2027. The contractual agreements may be terminated upon","page_number":36,"box":{"x":69,"y":619,"width":835,"height":11}},{"id":"c997b761-7d1f-42da-bcf7-eb864ac0801b","block_type":"box","text":"90 days’ notice by a majority of the non-interested directors of the Corporation or by a vote of a majority of the","page_number":36,"box":{"x":69,"y":634,"width":786,"height":11}},{"id":"bd77378b-7ea3-42ee-bb24-e7e937bf2c4c","block_type":"box","text":"outstanding voting securities of the Fund.","page_number":36,"box":{"x":69,"y":649,"width":293,"height":12}},{"id":"56319be3-dc7d-4fd8-90c9-5b29e842c41c","block_type":"box","text":"BlackRock has contractually agreed to waive and/or reimburse fees or expenses of the Fund in order to limit","page_number":36,"box":{"x":102,"y":672,"width":773,"height":11}},{"id":"e7a350f7-7da4-4e95-ae83-e28e0612c662","block_type":"box","text":"Total Annual Fund Operating Expenses After Fee Waivers and/or Expense Reimbursements (excluding Dividend","page_number":36,"box":{"x":68,"y":687,"width":787,"height":11}},{"id":"592ee72e-0282-4ab8-900c-0d936b9e491d","block_type":"box","text":"Expense/Stock Loan Fees, Interest Expense, Acquired Fund Fees and Expenses and cer tain other Fund expenses (as","page_number":36,"box":{"x":70,"y":702,"width":835,"height":11}},{"id":"88ab4ccc-35fe-4898-ac24-2b31119ad2d9","block_type":"box","text":"defined in the Fund’s Prospectuses)) as a percentage of average daily net assets to 0.78% for Investor A Shares,","page_number":36,"box":{"x":69,"y":717,"width":807,"height":12}},{"id":"4b829b00-9aa3-4144-9bff-a7b6cfe94d43","block_type":"box","text":"1.44% for Investor C Shares, 0.44% for Institutional Shares, 0.39% for Class K Shares, 0.75% for Service Shares,","page_number":36,"box":{"x":70,"y":732,"width":814,"height":11}},{"id":"8ecd5b77-5653-4481-a390-59a26785fa28","block_type":"box","text":"1.03% for Class R Shares, and 0.59% for Investor A1 Shares through June 30, 2027. The contractual agreements","page_number":36,"box":{"x":70,"y":748,"width":813,"height":11}},{"id":"992709fe-34f2-422c-8ef2-f147a427d13c","block_type":"box","text":"may be terminated upon 90 days’ notice by a majority of the Independent Directors or by a vote of a majority of the","page_number":36,"box":{"x":69,"y":763,"width":819,"height":11}},{"id":"6bb79651-f5b3-4c3f-8e74-02560b6dbd92","block_type":"box","text":"outstanding voting securities of the Fund.","page_number":36,"box":{"x":69,"y":778,"width":293,"height":11}},{"id":"e077eb8b-5fe2-4d15-a712-9f2d6a0c36af","block_type":"box","text":"Pursuant to the Management Agreement, the Manager may from time to time, in its sole discretion to the extent","page_number":36,"box":{"x":102,"y":801,"width":800,"height":11}},{"id":"3713e543-2102-42d1-96df-38b65a95d4eb","block_type":"box","text":"permitted by applicable law, appoint one or more sub-advisers, including, without limitation, affiliates of the Manager,","page_number":36,"box":{"x":70,"y":816,"width":834,"height":11}},{"id":"92057c2f-ff73-4f04-b804-8f90fd21b77f","block_type":"box","text":"to per form investment advisory services with respect to the Fund. In addition, the Manager may delegate cer tain of","page_number":36,"box":{"x":68,"y":831,"width":825,"height":11}},{"id":"94ab0244-38e5-422a-92ff-434cb9bdef16","block_type":"box","text":"its investment advisory functions under the Management Agreement to one or more of its affiliates to the extent","page_number":36,"box":{"x":70,"y":846,"width":801,"height":11}},{"id":"7ffd69aa-0cec-491e-ad9d-88c24e7e9f60","block_type":"box","text":"permitted by applicable law. The Manager may terminate any or all sub-advisers or such delegation arrangements in","page_number":36,"box":{"x":70,"y":861,"width":823,"height":11}},{"id":"3b5751d9-9fa7-42b2-aace-8983122c751a","block_type":"box","text":"its sole discretion at any time to the extent permitted by applicable law.","page_number":36,"box":{"x":70,"y":876,"width":508,"height":11}},{"id":"cc620623-bfb5-4f09-ba0d-9e9ccbe20ce4","block_type":"box","text":"I-20","page_number":36,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"f731c50c-0e3e-4de2-94d0-57e9674875c2","block_type":"box","text":"NM1026U-6033063-36/246","page_number":36,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"3621fd7c-0e10-4aca-83b8-1322c4756c2c","block_type":"box","text":"The Manager has entered into a sub-advisory agreement with each of BlackRock International Limited (“BIL”) and","page_number":37,"box":{"x":101,"y":45,"width":807,"height":11}},{"id":"9e3ec41b-c71a-4716-9073-14558ba7302a","block_type":"box","text":"BlackRock (Singapore) Limited (“BSL,” and together with BIL the “Sub-Advisers”) pursuant to which, with respect to","page_number":37,"box":{"x":70,"y":60,"width":820,"height":11}},{"id":"e681baeb-ddda-40ad-9b47-5bd3a4d0eb75","block_type":"box","text":"the Fund, the Sub-Advisers receive for their services for that por tion of the Fund for which each Sub-Adviser serves as","page_number":37,"box":{"x":68,"y":75,"width":841,"height":11}},{"id":"d86c172f-0283-4da6-a96d-15aa346920cf","block_type":"box","text":"sub-adviser a monthly fee at an annual rate equal to a percentage of the management fee paid to the Manager under","page_number":37,"box":{"x":69,"y":90,"width":836,"height":11}},{"id":"d8cfb58b-4ce4-4d97-946b-74a1d8bad02b","block_type":"box","text":"the Management Agreement with respect to the Fund.","page_number":37,"box":{"x":68,"y":105,"width":383,"height":11}},{"id":"0aa1c27e-d5eb-4926-808c-49d586f2843a","block_type":"box","text":"The table below sets for th information about the total management fees paid by the Fund and, prior to","page_number":37,"box":{"x":101,"y":128,"width":731,"height":11}},{"id":"65802670-ae53-4c90-8054-65d309c14340","block_type":"box","text":"September 16, 2024, total management fees paid by the Master Por tfolio to the Manager (which includes amounts","page_number":37,"box":{"x":69,"y":143,"width":823,"height":11}},{"id":"99f87021-a768-457a-befa-1fe01b82cccf","block_type":"box","text":"paid by the Manager to the Sub-Advisers) and the amounts waived and/or reimbursed by the Manager for the periods","page_number":37,"box":{"x":70,"y":158,"width":833,"height":11}},{"id":"6c6faf6d-0f49-49d3-97c2-1133dd2b024d","block_type":"box","text":"indicated:","page_number":37,"box":{"x":70,"y":173,"width":67,"height":9}},{"id":"8e553d06-e887-494e-944d-0abd5c836e0d","block_type":"box","text":"Total Return Fund Master 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Manager","page_number":37,"box":{"x":554,"y":227,"width":91,"height":9}},{"id":"522cf048-12ab-4428-959a-90e9e3d12a35","block_type":"box","text":"Fees Paid to the","page_number":37,"box":{"x":694,"y":217,"width":95,"height":7}},{"id":"a886f1ec-e78d-4cf0-8f1f-06c1123c5735","block_type":"box","text":"Manager","page_number":37,"box":{"x":717,"y":227,"width":50,"height":9}},{"id":"8c07877f-613a-4eaf-a615-2a30d085713a","block_type":"box","text":"Fees Waived by","page_number":37,"box":{"x":820,"y":217,"width":89,"height":9}},{"id":"09b567a7-e7f2-4a09-a699-d4dacf900a25","block_type":"box","text":"the Manager","page_number":37,"box":{"x":827,"y":227,"width":74,"height":9}},{"id":"2fb496ac-9e79-4edf-9998-5be6ab44c6c0","block_type":"box","text":"Fiscal Year Ended","page_number":37,"box":{"x":70,"y":245,"width":122,"height":9}},{"id":"8974e21e-01b6-46ca-b2c4-b8c01cdc0038","block_type":"box","text":"September 30, 2025 . . . $65,874,294 $520,146 $3,267,619 $ 0 $ 0","page_number":37,"box":{"x":79,"y":259,"width":821,"height":11}},{"id":"112b1ed6-e1e3-4a44-a467-8e5d8bddc5c4","block_type":"box","text":"Fiscal Year Ended","page_number":37,"box":{"x":70,"y":275,"width":122,"height":9}},{"id":"299bbe73-4fc6-45e3-abce-71a4356d2d49","block_type":"box","text":"September 30, 2024 . . . $54,224,171 $ 52,192 $1,749,806 $9,626,572 $385,934","page_number":37,"box":{"x":79,"y":288,"width":821,"height":12}},{"id":"dbbad6b8-2ae0-4c52-8569-8b2e4e24a786","block_type":"box","text":"Fiscal Year Ended","page_number":37,"box":{"x":70,"y":304,"width":122,"height":9}},{"id":"52160f06-10ad-48ff-b1dd-cd817be4b4b5","block_type":"box","text":"September 30, 2023 . . . $50,529,354 $ 0 $1,194,035 $9,527,309 $702,458","page_number":37,"box":{"x":79,"y":318,"width":821,"height":12}},{"id":"7f5afa5e-5b12-4ab3-8b70-435630555ab7","block_type":"box","text":"Information Regarding the Portfolio Managers","page_number":37,"box":{"x":69,"y":350,"width":335,"height":11}},{"id":"39019fa2-3866-45f1-baee-54eaad4c3a79","block_type":"box","text":"Rick Rieder, Russell Brownback, Chi Chen, Siddhar th Mehta and Sam Summers are the Fund’s por tfolio","page_number":37,"box":{"x":102,"y":373,"width":741,"height":11}},{"id":"55b6d5ac-939f-4e06-9c65-9e4b6f7b794e","block_type":"box","text":"managers and are primarily responsible for the day-to-day management of the Fund’s por tfolio.","page_number":37,"box":{"x":69,"y":388,"width":673,"height":11}},{"id":"7fc5ea0e-af03-40d7-a571-f36af2453819","block_type":"box","text":"Other Funds and Accounts Managed","page_number":37,"box":{"x":70,"y":418,"width":257,"height":11}},{"id":"68eae048-b162-40cc-9f55-07b391a50ec4","block_type":"box","text":"The following table sets for th information about the funds and accounts other than the Fund for which 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Million","page_number":37,"box":{"x":308,"y":578,"width":591,"height":9}},{"id":"11d00d61-251a-4a6f-b493-c366a2ebb22a","block_type":"box","text":"Russell Brownback 14 14 30 0 0 9","page_number":37,"box":{"x":74,"y":591,"width":783,"height":7}},{"id":"7919101d-930d-49b6-acf9-5dac446cef01","block_type":"box","text":"$58.51 Billion $26.54 Billion $15.08 Billion $0 $0 $5.48 Billion","page_number":37,"box":{"x":312,"y":603,"width":578,"height":9}},{"id":"45ce73de-bf23-4972-99da-8f2a0c48bf04","block_type":"box","text":"Chi Chen 8 9 13 0 0 6","page_number":37,"box":{"x":74,"y":617,"width":783,"height":7}},{"id":"013ac250-cbfe-48ca-bc19-4c0f9863d372","block_type":"box","text":"$9.78 Billion $16.43 Billion $7.36 Billion $0 $0 $5.04 Billion","page_number":37,"box":{"x":316,"y":629,"width":574,"height":8}},{"id":"4d3aee43-3c7c-41ab-948f-cad0b8b4ca99","block_type":"box","text":"Siddhar th Mehta 14 13 61 0 0 0","page_number":37,"box":{"x":74,"y":642,"width":783,"height":7}},{"id":"db617012-6968-4f16-bd1c-d5f93f2b8c1e","block_type":"box","text":"$21.22 Billion $18.85 Billion $32.72 Billion $0 $0 $0","page_number":37,"box":{"x":312,"y":654,"width":549,"height":8}},{"id":"608085a1-20e6-4714-8fb7-7388272fa07a","block_type":"box","text":"Sam Summers 11 10 17 0 0 6","page_number":37,"box":{"x":74,"y":667,"width":783,"height":7}},{"id":"5f169834-5eb7-45b0-af4a-b53089bc0b2b","block_type":"box","text":"$17.89 Billion $17.79 Billion $11.84 Billion $0 $0 $5.04 Billion","page_number":37,"box":{"x":312,"y":679,"width":578,"height":8}},{"id":"785eb900-0922-4653-a8f9-98cb644cc9c3","block_type":"box","text":"Por tfolio Manager Compensation Overview","page_number":37,"box":{"x":69,"y":714,"width":304,"height":11}},{"id":"723c31d5-7fda-4c1c-b89c-49c0ee3208cd","block_type":"box","text":"The discussion below describes the por tfolio managers’ compensation as of September 30, 2025.","page_number":37,"box":{"x":101,"y":736,"width":705,"height":12}},{"id":"29b40690-9d67-426d-9de2-c9eaf85d8eb9","block_type":"box","text":"BlackRock’s financial arrangements with its por tfolio managers, its competitive compensation and its career","page_number":37,"box":{"x":102,"y":759,"width":774,"height":11}},{"id":"8ef94b2c-9c49-40f0-bd31-a52c45b5d907","block_type":"box","text":"path emphasis at all levels reflect the value senior management places on key resources. Compensation may include","page_number":37,"box":{"x":70,"y":774,"width":837,"height":11}},{"id":"e6949747-9e03-444b-9e04-cf6c86a78744","block_type":"box","text":"a variety of components and may vary from year to year based on a number of factors. The principal components of","page_number":37,"box":{"x":69,"y":789,"width":823,"height":11}},{"id":"3f4ccbab-2f89-4cc7-a52a-b10bc95b687e","block_type":"box","text":"compensation include a base salary, a per formance-based discretionary bonus, par ticipation in various benefits","page_number":37,"box":{"x":69,"y":804,"width":799,"height":11}},{"id":"75add4ae-cc58-4202-b8c8-08b212d67033","block_type":"box","text":"programs and one or more of the incentive compensation programs established by BlackRock.","page_number":37,"box":{"x":70,"y":819,"width":670,"height":12}},{"id":"cd1002fe-fe59-4f8b-84b5-6a242d229da3","block_type":"box","text":"Base Compensation.","page_number":37,"box":{"x":102,"y":842,"width":148,"height":11}},{"id":"241ab631-8136-450e-b329-9db7abf0f729","block_type":"box","text":"Generally, por tfolio managers receive base compensation based on their position with the","page_number":37,"box":{"x":257,"y":842,"width":640,"height":11}},{"id":"3e9304ab-430b-4eba-ae26-e19ca0990aa2","block_type":"box","text":"firm.","page_number":37,"box":{"x":68,"y":857,"width":32,"height":9}},{"id":"a7c2275e-8909-4413-84aa-cf9793300fca","block_type":"box","text":"I-21","page_number":37,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"e7007ea4-bcb9-48dd-b233-9a950c1cc937","block_type":"box","text":"NM1026U-6033063-37/246","page_number":37,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"ee6a8482-dd7b-419b-94fd-72ff92783a89","block_type":"box","text":"Discretionary Incentive Compensation.","page_number":38,"box":{"x":102,"y":45,"width":281,"height":11}},{"id":"ee5e0285-373f-4bf6-9645-170ba90cd68b","block_type":"box","text":"Discretionary incentive compensation is a function of several","page_number":38,"box":{"x":391,"y":45,"width":432,"height":11}},{"id":"19f9e8b1-9107-4f6b-a3ef-2de048e555fc","block_type":"box","text":"components: the per formance of BlackRock, Inc., the per formance of the por tfolio manager’s group within","page_number":38,"box":{"x":69,"y":60,"width":759,"height":11}},{"id":"0ee17daa-08d8-4e10-9b04-adbba67d1c7a","block_type":"box","text":"BlackRock, the investment per formance, including risk-adjusted returns, of the firm’s assets under management or","page_number":38,"box":{"x":70,"y":75,"width":821,"height":11}},{"id":"7ea3f1f9-52a8-4d93-9b10-dcbf46f46452","block_type":"box","text":"supervision by that por tfolio manager relative to predetermined benchmarks, and the individual’s per formance and","page_number":38,"box":{"x":69,"y":90,"width":819,"height":11}},{"id":"a1b8b2f5-bfbf-4a11-8181-b83e9dc8a293","block_type":"box","text":"contribution to the overall per formance of these por tfolios and BlackRock. In most cases, these benchmarks are the","page_number":38,"box":{"x":69,"y":105,"width":832,"height":11}},{"id":"e77293da-97a1-43b8-97a4-bf36abd17f6a","block_type":"box","text":"same as the benchmark or benchmarks against which the per formance of the Fund or other accounts managed by","page_number":38,"box":{"x":69,"y":120,"width":816,"height":12}},{"id":"9d081d29-0ce6-455d-acd3-28448c6326e8","block_type":"box","text":"the por tfolio managers are measured. Among other things, BlackRock’s Chief Investment Officers make a subjective","page_number":38,"box":{"x":68,"y":135,"width":832,"height":12}},{"id":"a3307f4f-c888-40b2-847c-0aaa660b9ae0","block_type":"box","text":"determination with respect to each por tfolio manager’s compensation based on the per formance of the Fund and","page_number":38,"box":{"x":69,"y":150,"width":809,"height":12}},{"id":"2eb53b16-f758-4d2c-8074-e3a97b0eddc1","block_type":"box","text":"other accounts managed by each por tfolio manager relative to the various benchmarks. Per formance of fixed income","page_number":38,"box":{"x":69,"y":166,"width":833,"height":11}},{"id":"0d300894-766b-4e6f-bc77-619fc101a484","block_type":"box","text":"funds is measured on a pre-tax and/or after-tax basis over various time periods including 1-, 3- and 5- year periods,","page_number":38,"box":{"x":68,"y":181,"width":822,"height":11}},{"id":"1d219e42-9af2-47e5-b39d-86947f1f39b7","block_type":"box","text":"as applicable. With respect to these por tfolio managers, such benchmarks for the Fund and other accounts are:","page_number":38,"box":{"x":69,"y":196,"width":797,"height":11}},{"id":"64207202-7272-4783-b088-673b46635658","block_type":"box","text":"Portfolio Manager Benchmarks","page_number":38,"box":{"x":69,"y":224,"width":267,"height":9}},{"id":"a53d329a-9dde-41d1-af3f-57f1ebc144eb","block_type":"box","text":"Rick Rieder","page_number":38,"box":{"x":70,"y":241,"width":79,"height":9}},{"id":"132c39df-e417-457c-85d8-e68d464f8c13","block_type":"box","text":"Russell Brownback","page_number":38,"box":{"x":70,"y":256,"width":133,"height":9}},{"id":"c11dddf3-c5a9-4688-a862-ac4801ed1089","block_type":"box","text":"Chi Chen","page_number":38,"box":{"x":69,"y":271,"width":62,"height":9}},{"id":"9ef19cfb-6271-43cf-a95f-8606fcb900f3","block_type":"box","text":"Sam Summers","page_number":38,"box":{"x":69,"y":286,"width":104,"height":9}},{"id":"ed0f2c54-9054-4821-b052-a03df401d287","block_type":"box","text":"A combination of market-based indices (e.g., Bloomberg U.S. Aggregate Bond Index),","page_number":38,"box":{"x":264,"y":241,"width":603,"height":11}},{"id":"9f33d81f-8d3a-4c89-9a00-32ba1679f8e0","block_type":"box","text":"cer tain customized indices and cer tain fund industry peer groups.","page_number":38,"box":{"x":264,"y":256,"width":469,"height":11}},{"id":"d803b080-43cc-4673-bdb5-355c62da95b8","block_type":"box","text":"Siddhar th Mehta A combination of market-based indices (e.g. FTSE Mor tgage Index, Bloomberg GNMA MBS","page_number":38,"box":{"x":69,"y":309,"width":837,"height":11}},{"id":"5228d75b-c103-4fbc-8177-d566012ec4c2","block_type":"box","text":"Index), cer tain customized indices and cer tain fund industry peer groups.","page_number":38,"box":{"x":265,"y":324,"width":521,"height":11}},{"id":"2d4e1767-aba4-413b-9a06-09251dccddc9","block_type":"box","text":"Distribution of Discretionary Incentive Compensation.","page_number":38,"box":{"x":102,"y":348,"width":389,"height":11}},{"id":"ba5f25e5-f85e-4dfe-a5aa-331900d626d1","block_type":"box","text":"Discretionary incentive compensation is distributed to","page_number":38,"box":{"x":499,"y":348,"width":383,"height":11}},{"id":"cfeca70d-dafe-4510-95b8-9a338f40b023","block_type":"box","text":"por tfolio managers in a combination of cash, deferred BlackRock, Inc. stock awards, and/or deferred cash awards","page_number":38,"box":{"x":70,"y":363,"width":815,"height":11}},{"id":"957a30ba-f3e9-4b52-955a-34ab98b4a504","block_type":"box","text":"that notionally track the return of cer tain BlackRock investment products.","page_number":38,"box":{"x":68,"y":378,"width":522,"height":11}},{"id":"a0a52476-1c4a-486d-8870-70e6cbfc6d07","block_type":"box","text":"Por tfolio managers receive their annual discretionary incentive compensation in the form of cash. Por tfolio","page_number":38,"box":{"x":102,"y":401,"width":760,"height":11}},{"id":"00da5cd5-35c3-45ac-8879-66a0d45636e6","block_type":"box","text":"managers whose total compensation is above a specified threshold also receive deferred BlackRock, Inc. stock","page_number":38,"box":{"x":69,"y":416,"width":795,"height":11}},{"id":"d95af08d-e8fe-4362-8d69-af1eb07ec051","block_type":"box","text":"awards annually as par t of their discretionary incentive compensation. Paying a por tion of discretionary incentive","page_number":38,"box":{"x":69,"y":431,"width":805,"height":11}},{"id":"f265df62-f5ba-4425-9f51-1b719b33bdf9","block_type":"box","text":"compensation in the form of deferred BlackRock, Inc. stock puts compensation earned by a por tfolio manager for a","page_number":38,"box":{"x":69,"y":446,"width":822,"height":11}},{"id":"3c5e0388-88b8-475f-a620-54dfaafeb900","block_type":"box","text":"given year “at risk” based on BlackRock’s ability to sustain and improve its per formance over future periods. In some","page_number":38,"box":{"x":68,"y":461,"width":839,"height":11}},{"id":"0564c4c2-21e8-43d1-96fc-571ed09ded9c","block_type":"box","text":"cases, additional deferred BlackRock, Inc. stock may be granted to cer tain key employees as par t of a long-term","page_number":38,"box":{"x":69,"y":476,"width":802,"height":11}},{"id":"2a6c6f3c-e579-4a01-b908-60e7af7871bc","block_type":"box","text":"incentive award to aid in retention, align interests with long-term shareholders and motivate per formance. Deferred","page_number":38,"box":{"x":70,"y":491,"width":820,"height":12}},{"id":"23cb7ce0-8d1d-44f2-b9ad-dff1fb39dcb5","block_type":"box","text":"BlackRock, Inc. stock awards are generally granted in the form of BlackRock, Inc. restricted stock units that vest","page_number":38,"box":{"x":70,"y":506,"width":801,"height":12}},{"id":"e45d1a54-12f7-40d2-9d0c-1c33427a5ddb","block_type":"box","text":"pursuant to the terms of the applicable plan and, once vested, settle in BlackRock, Inc. common stock. The por tfolio","page_number":38,"box":{"x":70,"y":521,"width":831,"height":11}},{"id":"a0a687bc-2771-4252-bd4e-d700e2d6cc6e","block_type":"box","text":"managers of this Fund have deferred BlackRock, Inc. stock awards.","page_number":38,"box":{"x":69,"y":537,"width":479,"height":11}},{"id":"f417582d-c605-4081-836d-24f279c9a241","block_type":"box","text":"For cer tain por tfolio managers, a por tion of the discretionary incentive compensation is also distributed in the","page_number":38,"box":{"x":102,"y":559,"width":785,"height":12}},{"id":"189a73a4-510a-47c4-aba3-d756e91bcce4","block_type":"box","text":"form of deferred cash awards that notionally track the returns of select BlackRock investment products they manage,","page_number":38,"box":{"x":68,"y":574,"width":836,"height":12}},{"id":"77b8ddf3-cad9-41ed-a4af-4b7acd9ab6a5","block_type":"box","text":"which provides direct alignment of por tfolio manager discretionary incentive compensation with investment product","page_number":38,"box":{"x":68,"y":589,"width":821,"height":12}},{"id":"196c338f-c09a-4c19-8469-c2cd1751d192","block_type":"box","text":"results. Deferred cash awards vest ratably over a number of years and, once vested, settle in the form of cash. Only","page_number":38,"box":{"x":69,"y":605,"width":829,"height":11}},{"id":"7788fdca-9f94-4399-adb2-6ec29fc3bf6c","block_type":"box","text":"por tfolio managers who manage specified products and whose total compensation is above a specified threshold are","page_number":38,"box":{"x":70,"y":620,"width":835,"height":11}},{"id":"77b1fd96-f27d-45f4-8680-5aa53e14a72c","block_type":"box","text":"eligible to par ticipate in the deferred cash award program.","page_number":38,"box":{"x":69,"y":635,"width":414,"height":11}},{"id":"402fec4a-167a-4990-b022-1f4ef770f66e","block_type":"box","text":"Other Compensation Benefits.","page_number":38,"box":{"x":101,"y":658,"width":218,"height":11}},{"id":"29930c32-e132-4b74-a702-49b56ea4b570","block_type":"box","text":"In addition to base salary and discretionary incentive compensation, por tfolio","page_number":38,"box":{"x":327,"y":658,"width":552,"height":11}},{"id":"f1b576d7-49fc-460d-8fff-c48cc37d752f","block_type":"box","text":"managers may be eligible to receive or par ticipate in one or more of the following:","page_number":38,"box":{"x":69,"y":673,"width":582,"height":11}},{"id":"c939e3a9-af39-4fff-8bab-d9829965c00b","block_type":"box","text":"Incentive Savings Plans","page_number":38,"box":{"x":102,"y":695,"width":167,"height":12}},{"id":"5423e160-36c2-47f7-9ca4-5fadb2c7bc09","block_type":"box","text":"— BlackRock, Inc. has created a variety of incentive savings plans in which BlackRock","page_number":38,"box":{"x":274,"y":695,"width":614,"height":12}},{"id":"cc3cad0a-7fde-4e23-8332-5f6a84bfe9be","block_type":"box","text":"employees are eligible to par ticipate, including a 401(k) plan, the BlackRock Retirement Savings Plan (RSP), and the","page_number":38,"box":{"x":69,"y":711,"width":831,"height":11}},{"id":"2df3d0b1-e2bb-4495-ab37-9f40620ee926","block_type":"box","text":"BlackRock Employee Stock Purchase Plan (ESPP). The employer contribution components of the RSP include a","page_number":38,"box":{"x":70,"y":726,"width":785,"height":11}},{"id":"11d5c233-78ac-4650-96c3-e17635e3ed8f","block_type":"box","text":"company match equal to 50% of the first 8% of eligible pay contributed to the plan capped at $5,000 per year, and a","page_number":38,"box":{"x":69,"y":740,"width":830,"height":12}},{"id":"2e1441a0-317d-4c75-b2a5-ef42b7940ce6","block_type":"box","text":"company retirement contribution equal to 3-5% of eligible compensation up to the Internal Revenue Service limit","page_number":38,"box":{"x":69,"y":756,"width":799,"height":11}},{"id":"eeba7b99-cf5a-4bd1-a10b-9f1572c93c69","block_type":"box","text":"($350,000 for 2025). The RSP offers a range of investment options, including registered investment companies and","page_number":38,"box":{"x":69,"y":770,"width":831,"height":12}},{"id":"0e66da13-68b0-49ba-ac69-698f30bf81bd","block_type":"box","text":"collective investment funds managed by the firm. BlackRock contributions follow the investment direction set by","page_number":38,"box":{"x":69,"y":786,"width":798,"height":11}},{"id":"74a904a0-5a02-46e2-b60a-d266b5212e2d","block_type":"box","text":"par ticipants for their own contributions or, absent par ticipant investment direction, are invested into a target date","page_number":38,"box":{"x":70,"y":801,"width":809,"height":11}},{"id":"5726ef7a-ed14-42e4-819d-df0f973d5dc5","block_type":"box","text":"fund that corresponds to, or is closest to, the year in which the par ticipant attains age 65. The ESPP allows for","page_number":38,"box":{"x":68,"y":816,"width":793,"height":12}},{"id":"71a2d72c-7921-4c1b-857c-0c6372510023","block_type":"box","text":"investment in BlackRock common stock at a 5% discount on the fair market value of the stock on the purchase date.","page_number":38,"box":{"x":70,"y":831,"width":832,"height":11}},{"id":"2ee041eb-32a3-4126-b3f1-908ddf312af9","block_type":"box","text":"Annual par ticipation in the ESPP is limited to the purchase of 1,000 shares of common stock or a dollar value of","page_number":38,"box":{"x":68,"y":846,"width":805,"height":11}},{"id":"e28a5bd5-94c7-435f-8302-f65178d0f4a9","block_type":"box","text":"$25,000 based on its fair market value on the purchase date. All of the eligible por tfolio managers are eligible to","page_number":38,"box":{"x":69,"y":861,"width":808,"height":12}},{"id":"d17fd310-6042-4489-9042-a312916ddd37","block_type":"box","text":"par ticipate in these plans.","page_number":38,"box":{"x":70,"y":877,"width":185,"height":11}},{"id":"3023d23c-125c-41dc-ab62-35f430cbd73e","block_type":"box","text":"I-22","page_number":38,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"a47029fa-3a1c-422b-9c1f-fa338a815247","block_type":"box","text":"NM1026U-6033063-38/246","page_number":38,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"0ad24365-8475-4e9e-964c-42818a55125c","block_type":"box","text":"Por tfolio Manager Beneficial Holdings","page_number":39,"box":{"x":69,"y":45,"width":268,"height":11}},{"id":"f026914d-8634-49c9-b39f-0745389cd9a5","block_type":"box","text":"The following table sets for th the dollar range of equity securities of the Fund beneficially owned by each","page_number":39,"box":{"x":101,"y":67,"width":744,"height":12}},{"id":"5027ca04-6b0b-40b6-a77a-5ca52229b68f","block_type":"box","text":"por tfolio manager of the Fund as of September 30, 2025.","page_number":39,"box":{"x":70,"y":82,"width":411,"height":12}},{"id":"49e9acca-3cf0-4249-aada-3cdae0090320","block_type":"box","text":"Portfolio Manager","page_number":39,"box":{"x":69,"y":121,"width":105,"height":9}},{"id":"86174c93-11e5-4072-9dab-f5a7ad1fcfad","block_type":"box","text":"Dollar Range of Equity","page_number":39,"box":{"x":759,"y":111,"width":129,"height":9}},{"id":"117a7241-46ec-44ed-98a0-b7bd9afc6dda","block_type":"box","text":"Securities Beneficially Owned","page_number":39,"box":{"x":736,"y":121,"width":173,"height":9}},{"id":"3c7b1dc9-a5ec-4b25-8bf4-8c84213df7c0","block_type":"box","text":"Rick Rieder","page_number":39,"box":{"x":70,"y":139,"width":79,"height":8}},{"id":"de877cae-3e01-44cf-a49e-736adc6961d2","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Over $1,","page_number":39,"box":{"x":157,"y":138,"width":663,"height":11}},{"id":"25a805b1-4f15-48ab-a6b0-3aeca4e86242","block_type":"box","text":"000,000","page_number":39,"box":{"x":822,"y":139,"width":63,"height":10}},{"id":"9bde0e0a-c37b-477a-ab7b-cc4c0a1b1715","block_type":"box","text":"Russell Brownback","page_number":39,"box":{"x":70,"y":154,"width":133,"height":9}},{"id":"d019b7f6-fbfc-4c45-b652-9ee204b3b17d","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . None","page_number":39,"box":{"x":206,"y":154,"width":635,"height":9}},{"id":"6b3571b0-6ede-46b3-bdbd-4c10e8a175e2","block_type":"box","text":"Chi Chen","page_number":39,"box":{"x":69,"y":169,"width":62,"height":9}},{"id":"765acad1-f954-4464-a96b-3d5f39f94e39","block_type":"box","text":"......................................................................","page_number":39,"box":{"x":141,"y":176,"width":564,"height":2}},{"id":"8202da7a-9fc1-4059-aa26-20245153b5e9","block_type":"box","text":"$10,001 – $50,000","page_number":39,"box":{"x":751,"y":168,"width":144,"height":11}},{"id":"49caece0-2c1b-4163-81b3-51ade6c0ad8a","block_type":"box","text":"Siddhar th Mehta. .","page_number":39,"box":{"x":69,"y":184,"width":131,"height":9}},{"id":"20ad6c39-164b-4758-a9d5-bc4f12d65440","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . None","page_number":39,"box":{"x":206,"y":184,"width":635,"height":9}},{"id":"f3db64de-eacb-4766-ad66-5ec4d618bac7","block_type":"box","text":"Sam Summers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . None","page_number":39,"box":{"x":69,"y":199,"width":772,"height":9}},{"id":"ae237a90-b438-4e40-a0e5-ddb591563438","block_type":"box","text":"Por tfolio Manager Potential Material Conflicts of Interest","page_number":39,"box":{"x":69,"y":230,"width":403,"height":12}},{"id":"c7fc641d-4107-4de8-91a3-6a4d02bc0970","block_type":"box","text":"BlackRock has built a professional working environment, firm-wide compliance culture and compliance","page_number":39,"box":{"x":102,"y":253,"width":727,"height":11}},{"id":"4bdb983f-6170-4d5d-a666-242b37720570","block_type":"box","text":"procedures and systems designed to protect against potential incentives that may favor one account over another.","page_number":39,"box":{"x":70,"y":268,"width":814,"height":12}},{"id":"bcb30f91-a1f5-4b84-b366-dd275ae5b90e","block_type":"box","text":"BlackRock has adopted policies and procedures that address the allocation of investment oppor tunities, execution of","page_number":39,"box":{"x":70,"y":283,"width":837,"height":11}},{"id":"b529b602-a991-4c50-b889-c04012711c86","block_type":"box","text":"por tfolio transactions, personal trading by employees and other potential conflicts of interest that are designed to","page_number":39,"box":{"x":70,"y":298,"width":810,"height":12}},{"id":"2344d4cd-9b64-4f1a-b68b-f956facc257a","block_type":"box","text":"ensure that all client accounts are treated equitably over time. Never theless, BlackRock furnishes investment","page_number":39,"box":{"x":69,"y":314,"width":782,"height":11}},{"id":"c99fa131-3058-46fa-850d-be628929d016","block_type":"box","text":"management and advisory services to numerous clients in addition to the Fund, and BlackRock may, consistent with","page_number":39,"box":{"x":69,"y":329,"width":830,"height":11}},{"id":"f2c792b8-a13d-49c3-9b69-b2a5e4cb8e52","block_type":"box","text":"applicable law, make investment recommendations to other clients or accounts (including accounts which are hedge","page_number":39,"box":{"x":69,"y":344,"width":828,"height":11}},{"id":"c702ce78-ad4d-4b8d-8f9f-2d9bfdfd20bc","block_type":"box","text":"funds or have per formance or higher fees paid to BlackRock, or in which por tfolio managers have a personal interest","page_number":39,"box":{"x":68,"y":359,"width":834,"height":11}},{"id":"11a0a296-aee5-4c17-91f4-c08f569f7d36","block_type":"box","text":"in the receipt of such fees), which may be the same as or different from those made to the Fund. In addition,","page_number":39,"box":{"x":70,"y":374,"width":777,"height":11}},{"id":"256c5afd-7f94-485a-89cd-0b21db3ca209","block_type":"box","text":"BlackRock, its affiliates and significant shareholders and any officer, director, shareholder or employee may or may","page_number":39,"box":{"x":70,"y":389,"width":821,"height":11}},{"id":"76d85767-2f6b-4f13-ad45-34c8b47f63e8","block_type":"box","text":"not have an interest in the securities whose purchase and sale BlackRock recommends to the Fund. BlackRock, or","page_number":39,"box":{"x":69,"y":405,"width":819,"height":10}},{"id":"94b39a64-3b4a-4be5-9566-90969d3cc1be","block_type":"box","text":"any of its affiliates or significant shareholders, or any officer, director, shareholder, employee or any member of their","page_number":39,"box":{"x":69,"y":419,"width":832,"height":12}},{"id":"c71ef73f-af41-4359-9558-4cc001797bb5","block_type":"box","text":"families may take different actions than those recommended to the Fund by BlackRock with respect to the same","page_number":39,"box":{"x":68,"y":435,"width":804,"height":11}},{"id":"03da6f83-d14d-4eea-96b5-bf116f94462b","block_type":"box","text":"securities. Moreover, BlackRock may refrain from rendering any advice or services concerning securities of","page_number":39,"box":{"x":69,"y":450,"width":760,"height":11}},{"id":"7f6ad2fb-7296-4e8e-8677-f0b7cc88ad17","block_type":"box","text":"companies of which any of BlackRock’s (or its affiliates’ or significant shareholders’) officers, directors or employees","page_number":39,"box":{"x":69,"y":465,"width":834,"height":11}},{"id":"ba6f9e5e-3d2f-4384-852a-666ec7d9bd0b","block_type":"box","text":"are directors or officers, or companies as to which BlackRock or any of its affiliates or significant shareholders or the","page_number":39,"box":{"x":69,"y":480,"width":836,"height":11}},{"id":"6bd022c1-9e9b-452a-9b76-8fde884bea2f","block_type":"box","text":"officers, directors and employees of any of them has any substantial economic interest or possesses material non","page_number":39,"box":{"x":69,"y":495,"width":822,"height":11}},{"id":"99dec5ed-b247-4bed-b1d6-5299645469a3","block_type":"box","text":"public information. Cer tain por tfolio managers also may manage accounts whose investment strategies may at times","page_number":39,"box":{"x":70,"y":510,"width":835,"height":11}},{"id":"b710dae2-3b0e-455c-959e-d077251183a9","block_type":"box","text":"be opposed to the strategy utilized for the Fund. It should also be noted that Messrs. Rieder, Brownback, Mehta and","page_number":39,"box":{"x":69,"y":525,"width":829,"height":12}},{"id":"33c6dfd1-d9cb-4238-8b25-a68ef99cec96","block_type":"box","text":"Summers and Ms. Chen may be managing hedge fund and/or long only accounts, or may be par t of a team managing","page_number":39,"box":{"x":69,"y":540,"width":839,"height":12}},{"id":"e0bdf220-80fd-470f-9ff8-1f7771159e54","block_type":"box","text":"hedge fund and/or long only accounts, subject to incentive fees. Messrs. Rieder, Brownback, Mehta and Summers","page_number":39,"box":{"x":69,"y":555,"width":817,"height":12}},{"id":"22641b97-4ab2-40b4-8687-5f8433bb673d","block_type":"box","text":"and Ms. Chen may therefore be entitled to receive a por tion of any incentive fees earned on such accounts.","page_number":39,"box":{"x":69,"y":571,"width":768,"height":11}},{"id":"37ca6ef9-1214-488c-9852-8f50ccb9c706","block_type":"box","text":"As a fiduciary, BlackRock owes a duty of loyalty to its clients and must treat each client fairly. When BlackRock","page_number":39,"box":{"x":101,"y":593,"width":788,"height":11}},{"id":"3c7d916f-06b1-44b5-a1c9-cde78640cda9","block_type":"box","text":"purchases or sells securities for more than one account, the trades must be allocated in a manner consistent with its","page_number":39,"box":{"x":70,"y":608,"width":839,"height":11}},{"id":"b1356354-669f-489f-9917-a759dd2b3945","block_type":"box","text":"fiduciary duties. BlackRock attempts to allocate investments in a fair and equitable manner among client accounts,","page_number":39,"box":{"x":68,"y":623,"width":823,"height":12}},{"id":"bbfd7d48-27c1-4083-a9cb-b608fb170b00","block_type":"box","text":"with no account receiving preferential treatment. To this end, BlackRock has adopted policies that are intended to","page_number":39,"box":{"x":68,"y":639,"width":812,"height":11}},{"id":"4968c964-0f1b-49fc-a8f6-f6dccb26b689","block_type":"box","text":"ensure reasonable efficiency in client transactions and provide BlackRock with sufficient flexibility to allocate","page_number":39,"box":{"x":69,"y":654,"width":777,"height":11}},{"id":"01801471-77c8-4243-80c9-af943be5394f","block_type":"box","text":"investments in a manner that is consistent with the par ticular investment discipline and client base, as appropriate.","page_number":39,"box":{"x":70,"y":669,"width":826,"height":11}},{"id":"347a3ea6-5f32-45b0-99fd-48686cebd723","block_type":"box","text":"Accounting Services","page_number":39,"box":{"x":68,"y":699,"width":150,"height":11}},{"id":"34e65717-ca9e-405d-8f77-265f5bb73d72","block_type":"box","text":"BNY Mellon Investment Servicing (US) Inc. (“BNY Mellon”) is the accounting services provider to the Fund. BNY","page_number":39,"box":{"x":102,"y":722,"width":793,"height":11}},{"id":"63c3fbc9-7220-4f15-b40b-79a7d5754db4","block_type":"box","text":"Mellon records investment, capital share and income and expense activities; verifies and transmits trade tickets;","page_number":39,"box":{"x":70,"y":737,"width":804,"height":11}},{"id":"2f9c2c62-70f1-4629-a4bb-88aa96514b08","block_type":"box","text":"maintains accounting ledgers for investment securities; maintains tax lots; reconciles cash with the Fund’s","page_number":39,"box":{"x":69,"y":752,"width":761,"height":11}},{"id":"d54f6466-3883-44db-b5fb-7944ebc6dca8","block_type":"box","text":"custodian; repor ts cash balances to the Manager; prepares cer tain financial statements; calculates expenses, gains,","page_number":39,"box":{"x":69,"y":767,"width":837,"height":11}},{"id":"837d5ab2-937c-49a3-b5b7-15c612e39269","block_type":"box","text":"losses and income; controls disbursements; works with independent pricing sources; and computes and repor ts net","page_number":39,"box":{"x":70,"y":783,"width":829,"height":11}},{"id":"06219245-a5ff-49e4-b5c0-4ec23f34c9d4","block_type":"box","text":"asset value. In connection with its accounting services, BNY Mellon also provides cer tain administration services.","page_number":39,"box":{"x":69,"y":798,"width":812,"height":11}},{"id":"58300c74-4541-4baa-8a29-f704f642e757","block_type":"box","text":"Prior to September 16, 2024, the Fund invested all of its assets in the Master Por tfolio as par t of a “master/feeder”","page_number":39,"box":{"x":69,"y":812,"width":835,"height":12}},{"id":"9a62f948-37c7-44e7-afee-8eb83c3b6a55","block_type":"box","text":"structure, and accounting services were paid at the Master Por tfolio level. Effective September 16, 2024, the","page_number":39,"box":{"x":69,"y":828,"width":784,"height":11}},{"id":"cf71b18e-b7e5-440b-acf7-706a006ad6a8","block_type":"box","text":"accounting services agreement was terminated with the respect to the Master Por tfolio. The table below reflects the","page_number":39,"box":{"x":69,"y":843,"width":831,"height":11}},{"id":"e9bcdc78-2eba-445a-80a6-421a95a615a7","block_type":"box","text":"I-23","page_number":39,"box":{"x":476,"y":943,"width":26,"height":9}},{"id":"7087b849-f079-40e1-9241-7a659f783192","block_type":"box","text":"NM1026U-6033063-39/246","page_number":39,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"dc7dff9a-8633-441d-98e4-55ce7d06b8ab","block_type":"box","text":"“master/feeder” structure in place prior to September 16, 2024 and shows the amounts paid by the Master Por tfolio","page_number":40,"box":{"x":70,"y":45,"width":838,"height":11}},{"id":"a52a4048-1e02-490e-ac4b-c4726ecab785","block_type":"box","text":"to BNY Mellon and the Manager for accounting services for the periods indicated:","page_number":40,"box":{"x":68,"y":60,"width":581,"height":11}},{"id":"cedc7a6a-a023-4be8-b1e6-bece23833204","block_type":"box","text":"Fees Paid to","page_number":40,"box":{"x":718,"y":88,"width":71,"height":7}},{"id":"5f9b9d9b-a58e-4eab-9fe7-df3e2febf70c","block_type":"box","text":"BNY Mellon","page_number":40,"box":{"x":720,"y":98,"width":67,"height":7}},{"id":"70c0cef6-b88a-4ce1-bde7-9bdd4b0b8761","block_type":"box","text":"Fees Paid","page_number":40,"box":{"x":837,"y":88,"width":55,"height":7}},{"id":"50b4f309-2f9f-426f-bec2-8d79e39918ce","block_type":"box","text":"to the Manager","page_number":40,"box":{"x":819,"y":98,"width":90,"height":9}},{"id":"4baa39e1-1cf9-4a79-82fc-d62f54e5e8bd","block_type":"box","text":"Fiscal Year Ended September 30, 2025 . . . . . . . . . . . . . . . . . . . . . .","page_number":40,"box":{"x":70,"y":116,"width":461,"height":11}},{"id":"bb66176d-d00f-4569-8fd2-b97da2446135","block_type":"box","text":"...................","page_number":40,"box":{"x":537,"y":123,"width":149,"height":2}},{"id":"ba6457b3-d3a8-4104-aac3-6f413ff445a7","block_type":"box","text":"$510,000 $0","page_number":40,"box":{"x":718,"y":115,"width":156,"height":11}},{"id":"24727bd7-0aeb-4885-bebe-073d6009c824","block_type":"box","text":"Fiscal Year Ended September 30, 2024","page_number":40,"box":{"x":70,"y":131,"width":279,"height":11}},{"id":"f2fca1e2-d77b-41c0-84dc-e600a85fae99","block_type":"box","text":"1","page_number":40,"box":{"x":350,"y":131,"width":4,"height":5}},{"id":"08ed8f7b-f317-4c54-a89a-795fbe2cf22d","block_type":"box","text":".........................................","page_number":40,"box":{"x":358,"y":138,"width":328,"height":2}},{"id":"18668ecc-f317-46f4-a729-1828a02d45d2","block_type":"box","text":"$487,447 $0","page_number":40,"box":{"x":718,"y":130,"width":156,"height":11}},{"id":"8cc6d38b-b0a5-45e7-9cfb-b3df548b2b03","block_type":"box","text":"Fiscal Year Ended September 30, 2023","page_number":40,"box":{"x":70,"y":146,"width":279,"height":11}},{"id":"7ea50a18-7fa5-4c55-a99f-31b247272784","block_type":"box","text":"1","page_number":40,"box":{"x":350,"y":147,"width":4,"height":4}},{"id":"2b3a698a-07d6-44fe-a86a-6ffaf6e96ed2","block_type":"box","text":".........................................","page_number":40,"box":{"x":358,"y":154,"width":328,"height":1}},{"id":"21cbc19f-ff13-46e5-a3ad-c61c5fa9987b","block_type":"box","text":"$510,100 $0","page_number":40,"box":{"x":718,"y":145,"width":156,"height":12}},{"id":"e20dd84c-5b9b-4d3c-82b7-7ce7ece81bbf","block_type":"box","text":"1","page_number":40,"box":{"x":69,"y":171,"width":3,"height":3}},{"id":"3e90c9e7-4ba8-403f-a906-ff7bc3c9ee5e","block_type":"box","text":"For providing services to the Master Por tfolio and each feeder fund which invested its assets in the Master Por tfolio, prior to","page_number":40,"box":{"x":94,"y":170,"width":710,"height":10}},{"id":"d5561415-bef7-4568-a00b-8a2a728b0286","block_type":"box","text":"September 16, 2024.","page_number":40,"box":{"x":93,"y":181,"width":123,"height":8}},{"id":"e14e8f8c-1f2f-4b3d-a2a1-ca7ffbe45b47","block_type":"box","text":"Custodian","page_number":40,"box":{"x":69,"y":209,"width":72,"height":9}},{"id":"88fb3761-57e5-4397-bd1f-09dd7742fcbb","block_type":"box","text":"The Bank of New York Mellon, which has its principal offices at 240 Greenwich Street, New York, NY 10286,","page_number":40,"box":{"x":101,"y":232,"width":771,"height":11}},{"id":"a7f0bb92-b92c-49d1-a896-8f34859763c4","block_type":"box","text":"serves as the custodian for the Fund.","page_number":40,"box":{"x":69,"y":247,"width":266,"height":9}},{"id":"78b62381-9108-4b7f-9bbf-39ee140e02f9","block_type":"box","text":"Transfer Agency and Shareholders’ Administrative Services","page_number":40,"box":{"x":68,"y":277,"width":432,"height":11}},{"id":"7a851887-9c40-44ff-acf0-1436ea9f8eca","block_type":"box","text":"BNY Mellon, which has its principal place of business at 301 Bellevue Parkway, Wilmington, Delaware 19809,","page_number":40,"box":{"x":102,"y":300,"width":782,"height":11}},{"id":"8f46bf17-236e-4e3a-bea0-bc9a02102006","block_type":"box","text":"serves as the transfer and dividend disbursement agent for the Fund.","page_number":40,"box":{"x":69,"y":315,"width":494,"height":11}},{"id":"90c301e3-ba23-4c97-b44f-e067cc4547f2","block_type":"box","text":"Pursuant to a Shareholders’ Administrative Services Agreement, the Manager provides cer tain shareholder","page_number":40,"box":{"x":102,"y":338,"width":762,"height":11}},{"id":"e6c705cb-0555-4927-bc81-4046057971e0","block_type":"box","text":"liaison services in connection with the Fund’s investor service center. The Fund reimburses the Manager for its costs","page_number":40,"box":{"x":70,"y":353,"width":834,"height":11}},{"id":"216ef5e8-812d-4eef-a378-2e5a697e1a37","block_type":"box","text":"in maintaining the service center, which costs include, among other things, employee salaries, leasehold expenses,","page_number":40,"box":{"x":70,"y":368,"width":823,"height":11}},{"id":"8a461b25-336b-4d2b-9a2f-837fc224531f","block_type":"box","text":"and other out-of-pocket expenses which are a component of the transfer agency fees in the Fund’s annual repor t.","page_number":40,"box":{"x":69,"y":383,"width":807,"height":11}},{"id":"50edbd62-ca78-4b93-9b34-96955e1a9a4d","block_type":"box","text":"The following table sets for th the fees paid by the Fund to the Manager pursuant to the Shareholders’","page_number":40,"box":{"x":101,"y":406,"width":725,"height":11}},{"id":"4ae7dfb2-b6b6-440f-8250-77ed25fa2435","block_type":"box","text":"Administrative Services Agreement for the periods indicated:","page_number":40,"box":{"x":68,"y":421,"width":432,"height":11}},{"id":"49f089e3-1a38-434b-b892-0f9fd78e6a79","block_type":"box","text":"Total Return Fund","page_number":40,"box":{"x":598,"y":455,"width":103,"height":7}},{"id":"528af4e4-cc39-4974-8a13-eb14f795c52e","block_type":"box","text":"Fees Paid to Manager","page_number":40,"box":{"x":586,"y":465,"width":128,"height":9}},{"id":"6f5fbba7-4394-4e75-9b80-44a44b3d189a","block_type":"box","text":"Total Return Fund","page_number":40,"box":{"x":775,"y":455,"width":103,"height":7}},{"id":"5a4742d4-6dbf-4c7a-a4e5-709160601ee7","block_type":"box","text":"Fees Waiver by the Manager","page_number":40,"box":{"x":744,"y":465,"width":165,"height":9}},{"id":"9a74084e-4f74-403e-b922-6180225bb79f","block_type":"box","text":"Fiscal Year Ended September 30, 2025 . . . . . . . . . . . . . . . . . . . . . . . . . $80,519 $42,753","page_number":40,"box":{"x":70,"y":482,"width":787,"height":11}},{"id":"27e80501-255f-4baa-b73f-bf97f4b40267","block_type":"box","text":"Fiscal Year Ended September 30, 2024 . . . . . . . . . . . . . . . . . . . . . . . . . $65,067 $32,622","page_number":40,"box":{"x":70,"y":497,"width":787,"height":12}},{"id":"3887a775-212a-45b4-9190-97771d189a2c","block_type":"box","text":"Fiscal Year Ended September 30, 2023 . . . . . . . . . . . . . . . . . . . . . . . . . $53,969 $21,680","page_number":40,"box":{"x":70,"y":512,"width":787,"height":12}},{"id":"64f7a9d3-7428-4a48-ab1b-e848e8876614","block_type":"box","text":"Organization and Management of Wholly-Owned Subsidiary","page_number":40,"box":{"x":69,"y":544,"width":428,"height":11}},{"id":"6ee318b0-eece-49c0-9a77-7ba2c18896e3","block_type":"box","text":"The Fund intends to gain exposure to commodity markets by investing up to 25% of its total assets in the","page_number":40,"box":{"x":101,"y":567,"width":751,"height":11}},{"id":"8fe49096-7c24-41a9-9154-7598e32f9818","block_type":"box","text":"Subsidiary. The Subsidiary invests primarily in commodity-related instruments.","page_number":40,"box":{"x":69,"y":582,"width":557,"height":11}},{"id":"6bee4fc7-f691-4609-8a14-ae67dd79b579","block_type":"box","text":"The Subsidiary is a company organized under the laws of the Cayman Islands, whose registered office is located","page_number":40,"box":{"x":101,"y":605,"width":803,"height":11}},{"id":"d94a5e67-bebc-42ff-8bdf-53edc6255be7","block_type":"box","text":"at the offices of Maples Corporate Services Limited, P.O. Box 309, Ugland House, Grand Cayman KYI-1104, Cayman","page_number":40,"box":{"x":69,"y":620,"width":831,"height":11}},{"id":"0fe7abc3-d464-47bb-aecf-1c28b29b12ba","block_type":"box","text":"Islands. The Subsidiary’s affairs are overseen by a board of directors, which is comprised of John M. Perlowski and","page_number":40,"box":{"x":70,"y":635,"width":821,"height":11}},{"id":"a09e2557-00ac-4dc1-bc08-579cce01df88","block_type":"box","text":"Trent Walker.","page_number":40,"box":{"x":68,"y":650,"width":91,"height":9}},{"id":"10a4b1dd-5a04-402a-be5d-0f9b92e281f4","block_type":"box","text":"The Manager provides investment management and administrative services to the Subsidiary. The Manager does","page_number":40,"box":{"x":101,"y":673,"width":808,"height":11}},{"id":"09d9fad0-dc18-4bad-b1a2-12221a459479","block_type":"box","text":"not receive separate compensation from the Subsidiary for providing it with investment advisory or administrative","page_number":40,"box":{"x":69,"y":688,"width":808,"height":11}},{"id":"78f2f183-7642-4c0b-8241-9a5024e20415","block_type":"box","text":"services. However, the Fund pays the Manager based on the Fund’s assets, including the assets invested in the","page_number":40,"box":{"x":69,"y":703,"width":800,"height":11}},{"id":"2a821451-4f45-4307-a618-4f3989c1aa49","block_type":"box","text":"Subsidiary. The Subsidiary entered into contracts for the provision of custody, accounting agent and audit services","page_number":40,"box":{"x":69,"y":718,"width":817,"height":11}},{"id":"8ec1b3db-462e-40d4-ad1d-468f1447dedc","block_type":"box","text":"with the same service providers that provide those services to the Fund.","page_number":40,"box":{"x":68,"y":733,"width":517,"height":11}},{"id":"b12301bd-1a10-484c-a532-1409692e02b2","block_type":"box","text":"The Subsidiary is managed pursuant to compliance policies and procedures that are the same, in all material","page_number":40,"box":{"x":101,"y":756,"width":780,"height":11}},{"id":"2cdf57db-5e7c-483a-be2b-ea3849afb35b","block_type":"box","text":"respects, as the policies and procedures adopted by the Fund. As a result, the Manager, in managing the","page_number":40,"box":{"x":69,"y":771,"width":750,"height":11}},{"id":"010b02f7-fd8f-4dcb-b059-25e81c12cb7d","block_type":"box","text":"Subsidiary’s por tfolio, is subject to the same investment policies and restrictions that apply to the management of","page_number":40,"box":{"x":69,"y":786,"width":820,"height":11}},{"id":"f35c987f-c2f8-470a-96b9-26a16444cbb2","block_type":"box","text":"the Fund, and, in par ticular, to the requirements relating to por tfolio leverage, liquidity, brokerage, and the timing and","page_number":40,"box":{"x":68,"y":801,"width":836,"height":11}},{"id":"012a81af-fee8-4d62-b923-e5ecad55eb87","block_type":"box","text":"method of the valuation of the Subsidiary’s por tfolio investments and shares of the Subsidiary. These policies and","page_number":40,"box":{"x":69,"y":816,"width":818,"height":11}},{"id":"7c01a1cb-9aff-4f6b-bff1-3c7a1fc8fa2d","block_type":"box","text":"restrictions are described elsewhere in detail in this SAI. The Fund and the Subsidiary test for compliance with","page_number":40,"box":{"x":69,"y":831,"width":787,"height":12}},{"id":"5c1fbd13-5fd8-47c1-a59d-023f72f0fc55","block_type":"box","text":"cer tain investment restrictions on a consolidated basis.","page_number":40,"box":{"x":69,"y":847,"width":397,"height":9}},{"id":"e4638a3b-509e-4638-bac3-5f27c81d993d","block_type":"box","text":"I-24","page_number":40,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"7bede8e3-9cde-45a4-983d-cf077fc23fe9","block_type":"box","text":"NM1026U-6033063-40/246","page_number":40,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"397491df-de66-48cf-a748-c25046c42620","block_type":"box","text":"Credit Agreement","page_number":41,"box":{"x":69,"y":45,"width":129,"height":11}},{"id":"823ec79a-45c1-419f-b425-3b39110562d9","block_type":"box","text":"The Corporation, on behalf of the Fund, along with cer tain other funds managed by the Manager and its affiliates","page_number":41,"box":{"x":101,"y":67,"width":804,"height":12}},{"id":"d3ed9d7c-b4d6-43e9-b3cc-66c13506b82b","block_type":"box","text":"(“Par ticipating Funds”), is a par ty to a 364-day, $2.4 billion credit agreement with a group of lenders, which facility","page_number":41,"box":{"x":69,"y":82,"width":817,"height":12}},{"id":"76ecb0a0-8c00-4abf-a38b-cbb996ad28f7","block_type":"box","text":"terminates on April 8, 2027, unless otherwise extended or renewed (the “Credit Agreement”). Excluding","page_number":41,"box":{"x":68,"y":98,"width":743,"height":11}},{"id":"f457bc23-3f42-4b77-a6af-6e44755d9be9","block_type":"box","text":"commitments designated for cer tain Par ticipating Funds, the Par ticipating Funds, including the Fund, can borrow up","page_number":41,"box":{"x":69,"y":113,"width":825,"height":11}},{"id":"80b5bd5f-07d7-48da-ae19-31471ab3ad74","block_type":"box","text":"to an aggregate commitment amount of $1.75 billion at any time outstanding, subject to asset coverage and other","page_number":41,"box":{"x":68,"y":127,"width":818,"height":12}},{"id":"72c21771-72d5-4af7-9eda-c3d94d474f4d","block_type":"box","text":"limitations as specified in the Credit Agreement. The Fund may borrow under the Credit Agreement to meet","page_number":41,"box":{"x":70,"y":143,"width":761,"height":11}},{"id":"acfab8a9-ba46-4d13-aff2-6de4903bc55b","block_type":"box","text":"shareholder redemptions and for other lawful purposes. However, the Fund may not borrow under the Credit","page_number":41,"box":{"x":69,"y":158,"width":768,"height":11}},{"id":"fcc8f6c9-8811-4f89-a228-e5a2bea6068b","block_type":"box","text":"Agreement for leverage. The Fund may borrow up to the maximum amount allowable under the Fund’s current","page_number":41,"box":{"x":68,"y":173,"width":781,"height":11}},{"id":"641355c8-3d92-4679-b13e-ad8fa60e8bd2","block_type":"box","text":"Prospectuses and SAI, subject to various other legal, regulatory or contractual limits. Borrowing results in interest","page_number":41,"box":{"x":69,"y":188,"width":812,"height":12}},{"id":"604466a9-c756-4ecd-ad91-814408d4abd6","block_type":"box","text":"expense and other fees and expenses for the Fund which may impact the Fund’s net expenses. The costs of","page_number":41,"box":{"x":69,"y":203,"width":774,"height":12}},{"id":"867f4f5c-1d4c-4a57-a227-ef1b0c830073","block_type":"box","text":"borrowing may reduce the Fund’s returns. The Fund is charged its pro rata share of upfront fees and commitment","page_number":41,"box":{"x":69,"y":218,"width":809,"height":12}},{"id":"732278f0-0b3e-4cfe-abfb-4ac26ac562dd","block_type":"box","text":"fees on the aggregate commitment amount based on its net assets. If the Fund borrows pursuant to the Credit","page_number":41,"box":{"x":68,"y":234,"width":792,"height":11}},{"id":"300f3dca-5953-40fc-b604-673ff89b37f2","block_type":"box","text":"Agreement, the Fund is charged interest at a variable rate. Prior to September 16, 2024, the Master LLC, on behalf","page_number":41,"box":{"x":68,"y":249,"width":826,"height":11}},{"id":"c7260c23-75bb-40f7-b9d4-98a54150215d","block_type":"box","text":"of the Master Por tfolio, was a par ty to the Credit Agreement.","page_number":41,"box":{"x":69,"y":264,"width":432,"height":11}},{"id":"124ebf08-62ee-462b-962c-9a4b200eb11c","block_type":"box","text":"V. Information on Sales Charges and Distribution Related Expenses","page_number":41,"box":{"x":68,"y":294,"width":491,"height":11}},{"id":"5e7f7740-4b3f-4813-8cde-8040cf369586","block_type":"box","text":"Set for th below is information on sales charges (including any contingent deferred sales charges (“CDSCs”))","page_number":41,"box":{"x":102,"y":317,"width":773,"height":11}},{"id":"6eb5c374-09b6-4faf-97bd-8f43f019b308","block_type":"box","text":"received by the Fund, including the amounts paid to affiliates of the Manager (“Affiliates”) for each of the Fund’s last","page_number":41,"box":{"x":69,"y":332,"width":834,"height":11}},{"id":"41bcfbad-343e-4cb0-b79b-98c08d0651e9","block_type":"box","text":"three fiscal years. BlackRock Investments, LLC (“BRIL” or the “Distributor”), an affiliate of the Manager, acts as the","page_number":41,"box":{"x":68,"y":347,"width":826,"height":11}},{"id":"54a02937-6208-4a4f-bf8d-5b1aef8a24e4","block_type":"box","text":"Fund’s sole distributor.","page_number":41,"box":{"x":70,"y":362,"width":161,"height":9}},{"id":"3f34adfe-137d-4aca-9993-91c8ff481a78","block_type":"box","text":"Investor A and Investor A1, Sales Charge Information","page_number":41,"box":{"x":70,"y":392,"width":377,"height":12}},{"id":"28e13283-ade4-4414-802a-cb5f1f873e81","block_type":"box","text":"Investor A Shares","page_number":41,"box":{"x":636,"y":421,"width":102,"height":7}},{"id":"c89d709e-3b7a-4a90-9de8-35559029cb55","block_type":"box","text":"Gross Sales","page_number":41,"box":{"x":466,"y":436,"width":68,"height":8}},{"id":"10f0e843-3430-467f-a2e1-7263c5b556f1","block_type":"box","text":"Charges","page_number":41,"box":{"x":476,"y":447,"width":48,"height":8}},{"id":"d9d79ae7-61f2-440e-9424-1b0bbb76b619","block_type":"box","text":"Collected","page_number":41,"box":{"x":473,"y":457,"width":54,"height":7}},{"id":"823e12cb-ddcb-4411-a139-2e5a14db48fd","block_type":"box","text":"Sales Charges","page_number":41,"box":{"x":566,"y":436,"width":84,"height":9}},{"id":"e276b544-46aa-4bfa-bb7b-ab7d4eb6afec","block_type":"box","text":"Retained by","page_number":41,"box":{"x":574,"y":447,"width":69,"height":8}},{"id":"2b717844-9410-4b1f-9ed4-c79f941cc7dd","block_type":"box","text":"BRIL","page_number":41,"box":{"x":595,"y":457,"width":27,"height":7}},{"id":"a6651d36-9842-470a-93b1-ead16597d242","block_type":"box","text":"Sales Charges","page_number":41,"box":{"x":679,"y":436,"width":84,"height":9}},{"id":"c8309efa-62fb-461a-93f2-6e24b785bda4","block_type":"box","text":"Paid to","page_number":41,"box":{"x":701,"y":447,"width":41,"height":7}},{"id":"51b8c079-0d5d-4a67-98be-6c70bfaf5142","block_type":"box","text":"Affiliates","page_number":41,"box":{"x":695,"y":457,"width":52,"height":7}},{"id":"9bc60a10-89a0-46f0-aff7-2cf615613fe0","block_type":"box","text":"CDSCs Received on","page_number":41,"box":{"x":794,"y":436,"width":114,"height":8}},{"id":"568368fe-f4fe-4cc8-8993-15a52a575eea","block_type":"box","text":"Redemption of","page_number":41,"box":{"x":810,"y":446,"width":84,"height":9}},{"id":"91bb611a-5576-4d15-a496-dcfc1d504073","block_type":"box","text":"Load-Waived Shares","page_number":41,"box":{"x":793,"y":457,"width":116,"height":7}},{"id":"25f6c02b-54b9-4130-b53b-4ad97cc95241","block_type":"box","text":"Fiscal Year Ended September 30, 2025 . . . . . . . . . . $170,190 $11,438 $11,438 $39,212","page_number":41,"box":{"x":70,"y":474,"width":812,"height":11}},{"id":"1107204e-897c-4a08-a459-85fbc80d9bf0","block_type":"box","text":"Fiscal Year Ended September 30, 2024 . . . . . . . . . . $125,565 $ 8,652 $ 8,652 $24,873","page_number":41,"box":{"x":70,"y":489,"width":812,"height":11}},{"id":"3fb6ecc4-ea51-4dc5-aa85-3673d8f73dc2","block_type":"box","text":"Fiscal Year Ended September 30, 2023 . . . . . . . . . . $271,189 $18,541 $18,541 $67,941","page_number":41,"box":{"x":70,"y":504,"width":812,"height":11}},{"id":"20c2f49a-5ad1-4d44-aa9f-d6099de27ac2","block_type":"box","text":"Investor A1 Shares","page_number":41,"box":{"x":634,"y":534,"width":110,"height":7}},{"id":"8f5d2f96-c95b-48a3-809f-c3ebfd3e91db","block_type":"box","text":"Gross Sales","page_number":41,"box":{"x":468,"y":550,"width":68,"height":7}},{"id":"423946d3-8c8a-47c7-98f7-1d9b8131b558","block_type":"box","text":"Charges","page_number":41,"box":{"x":478,"y":560,"width":48,"height":9}},{"id":"6af9b89e-0a12-4f45-8e5e-3d45ea731a54","block_type":"box","text":"Collected","page_number":41,"box":{"x":475,"y":570,"width":54,"height":7}},{"id":"ec4a2459-99b6-4392-97c7-11e89931f450","block_type":"box","text":"Sales Charges","page_number":41,"box":{"x":566,"y":550,"width":84,"height":9}},{"id":"6ca19f83-365c-4906-bb56-7616f81145ae","block_type":"box","text":"Retained by","page_number":41,"box":{"x":574,"y":560,"width":69,"height":9}},{"id":"af18f864-804d-4a48-aded-2aa4928d5659","block_type":"box","text":"BRIL","page_number":41,"box":{"x":595,"y":570,"width":27,"height":7}},{"id":"06ba82f5-888f-47d9-9532-bcc70e772851","block_type":"box","text":"Sales Charges","page_number":41,"box":{"x":679,"y":550,"width":84,"height":9}},{"id":"78e84add-23b3-47df-9134-3f114ea58a32","block_type":"box","text":"Paid to","page_number":41,"box":{"x":701,"y":560,"width":41,"height":7}},{"id":"f6cbae13-c306-4f08-821f-d21972c58136","block_type":"box","text":"Affiliates","page_number":41,"box":{"x":695,"y":570,"width":52,"height":7}},{"id":"8356004a-2194-4d43-9fee-677fcaeb7969","block_type":"box","text":"CDSCs Received on","page_number":41,"box":{"x":794,"y":550,"width":114,"height":7}},{"id":"5d83d2b9-0d44-4f62-b480-2eaa184d90ed","block_type":"box","text":"Redemption of","page_number":41,"box":{"x":810,"y":560,"width":84,"height":9}},{"id":"3b176d4a-6b03-492a-96d2-448fc8b393d8","block_type":"box","text":"Load-Waived Shares","page_number":41,"box":{"x":793,"y":570,"width":116,"height":7}},{"id":"40fa282c-a4db-4edf-aceb-dd7aac7350f5","block_type":"box","text":"Fiscal Year Ended September 30, 2025 .","page_number":41,"box":{"x":70,"y":588,"width":285,"height":11}},{"id":"f51c38dd-8bea-4376-b215-212336fa20f4","block_type":"box","text":". . . . . . . . . . $0 $0 $0 $0","page_number":41,"box":{"x":362,"y":587,"width":498,"height":10}},{"id":"b3880dfb-c0bd-4ef7-8a0a-42fa983aa836","block_type":"box","text":"Fiscal Year Ended September 30, 2024 .","page_number":41,"box":{"x":70,"y":603,"width":285,"height":11}},{"id":"7c887660-db5a-4acf-923a-43720a95bdf5","block_type":"box","text":". . . . . . . . . . $0 $0 $0 $0","page_number":41,"box":{"x":362,"y":602,"width":498,"height":11}},{"id":"fa32222f-4b38-4bb3-be5d-e6fcd4e6d630","block_type":"box","text":"Fiscal Year Ended September 30, 2023 .","page_number":41,"box":{"x":70,"y":618,"width":285,"height":11}},{"id":"e67e25d1-7e02-4c5b-ac82-ca94bae9afad","block_type":"box","text":". . . . . . . . . . $0 $0 $0 $0","page_number":41,"box":{"x":362,"y":617,"width":498,"height":11}},{"id":"24666513-d1c7-4ff3-b53f-072a1c25f26c","block_type":"box","text":"Investor C Sales Charge Information","page_number":41,"box":{"x":70,"y":649,"width":257,"height":12}},{"id":"abb7a96b-bff5-4a5a-bedb-ece9c637510e","block_type":"box","text":"Investor C Shares","page_number":41,"box":{"x":760,"y":678,"width":103,"height":7}},{"id":"0f4c7e43-4084-4702-bffe-963a5b826c78","block_type":"box","text":"CDSCs Received","page_number":41,"box":{"x":713,"y":693,"width":97,"height":8}},{"id":"44955fc8-cf0c-4433-8093-bfe432dcac82","block_type":"box","text":"by BRIL","page_number":41,"box":{"x":740,"y":704,"width":44,"height":8}},{"id":"4e3dcc5c-f0a2-4ca8-bcf3-d9789b6e92cb","block_type":"box","text":"CDSCs Paid","page_number":41,"box":{"x":840,"y":693,"width":69,"height":8}},{"id":"6eb923c4-7030-4d80-abc1-4e7a068c9a6a","block_type":"box","text":"to 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2023 . . . . .","page_number":41,"box":{"x":70,"y":752,"width":319,"height":10}},{"id":"5cb425ec-94fb-47f0-9dac-e687f7772659","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $2,385 $2,385","page_number":41,"box":{"x":395,"y":751,"width":506,"height":11}},{"id":"f5893718-85da-4456-86d3-85fb73dd9c08","block_type":"box","text":"The table below provides information for the fiscal year ended September 30, 2025 about the 12b-1 fees the","page_number":41,"box":{"x":101,"y":775,"width":780,"height":11}},{"id":"9f49e952-412d-4fcb-83d3-e98bee6ec804","block_type":"box","text":"Fund paid to BRIL under the Fund’s 12b-1 plans. 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4.17% and 1.01% of net asset value per share, respectively)","page_number":42,"box":{"x":79,"y":346,"width":535,"height":11}},{"id":"8576dd9a-83b5-4d06-ae05-ee3ec1dcc835","block_type":"box","text":"1","page_number":42,"box":{"x":615,"y":346,"width":4,"height":5}},{"id":"5bb7585c-908c-428e-9e71-8e33a672e146","block_type":"box","text":". $0.42 $0.10","page_number":42,"box":{"x":628,"y":345,"width":281,"height":11}},{"id":"f6e39ffb-7d54-4772-aaad-e3bef3678696","block_type":"box","text":"Offering Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .","page_number":42,"box":{"x":69,"y":365,"width":560,"height":12}},{"id":"df3da04f-276c-4a21-a4ed-7a8250d0d9b0","block_type":"box","text":"$10.46 $10.13","page_number":42,"box":{"x":730,"y":365,"width":179,"height":10}},{"id":"3f675744-43f9-44c0-9fe3-45437bbd7f63","block_type":"box","text":"1","page_number":42,"box":{"x":69,"y":397,"width":3,"height":4}},{"id":"2a3b845a-8df2-4e68-8d54-3a5af4fc4553","block_type":"box","text":"Rounded to the nearest one-hundredth percent; assumes maximum sales charge is applicable.","page_number":42,"box":{"x":94,"y":397,"width":541,"height":9}},{"id":"f4b8c671-66f4-42ea-8220-56f8b48eb5c2","block_type":"box","text":"The offering price for the Fund’s other share classes is equal to the share class’ net asset value computed as","page_number":42,"box":{"x":101,"y":418,"width":787,"height":11}},{"id":"cba36cd2-ae07-4f00-b590-dffac3eaa68e","block_type":"box","text":"set for th above for Investor A and Investor A1 Shares Shares. Though not subject to a sales charge, cer tain share","page_number":42,"box":{"x":69,"y":433,"width":814,"height":12}},{"id":"30335dba-f0a0-4bee-9aa8-430596e19270","block_type":"box","text":"classes may be subject to a CDSC on redemption. For more information on the purchasing and valuation of shares,","page_number":42,"box":{"x":69,"y":448,"width":822,"height":12}},{"id":"140700ac-da68-4f77-b444-2a216fb7a879","block_type":"box","text":"please see “Purchase of Shares” and “Pricing of Shares” in Par t II of this Statement of Additional Information.","page_number":42,"box":{"x":70,"y":463,"width":787,"height":12}},{"id":"fff035b4-0488-4067-8265-3b0292fb372b","block_type":"box","text":"The Subsidiary is subject to the same valuation policies as the Fund as described in “Pricing of Shares” in Par t II","page_number":42,"box":{"x":101,"y":486,"width":807,"height":11}},{"id":"ba1be8c0-85e9-4d65-b015-721c61e74657","block_type":"box","text":"of this SAI. The Fund’s investment in the Subsidiary is valued based on the value of the Subsidiary’s por tfolio","page_number":42,"box":{"x":69,"y":501,"width":783,"height":11}},{"id":"344ee09d-b9ba-42b2-a4d5-256ed823f6a4","block_type":"box","text":"investments. The Subsidiary prices its por tfolio investments pursuant to the same pricing and valuation","page_number":42,"box":{"x":70,"y":516,"width":738,"height":12}},{"id":"56bbfdac-268c-4192-aebd-410682cd0607","block_type":"box","text":"methodologies and procedures used by the Fund, which require, among other things, that each of the Subsidiary’s","page_number":42,"box":{"x":69,"y":532,"width":816,"height":11}},{"id":"4264a1a1-e878-4303-ab77-44dddb10a8a4","block_type":"box","text":"por tfolio investments be marked-to-market (that is, the value on the Subsidiary’s books changes) each business day","page_number":42,"box":{"x":70,"y":547,"width":830,"height":11}},{"id":"c48626ff-108e-4bc3-99b2-491468071812","block_type":"box","text":"to reflect changes in the market value of the investment.","page_number":42,"box":{"x":68,"y":562,"width":404,"height":11}},{"id":"51238466-b7a0-4f15-8a7a-c3a7fa6ab1b0","block_type":"box","text":"Total Return Fund","page_number":42,"box":{"x":733,"y":590,"width":103,"height":7}},{"id":"347aac88-84fe-418f-9261-ee92b21c827b","block_type":"box","text":"Investor A","page_number":42,"box":{"x":692,"y":608,"width":59,"height":7}},{"id":"9eb18358-ab94-4970-937b-74477246a834","block_type":"box","text":"Shares","page_number":42,"box":{"x":701,"y":618,"width":40,"height":8}},{"id":"03316faf-421b-4615-9068-2d7fcfd41924","block_type":"box","text":"Investor A1","page_number":42,"box":{"x":828,"y":608,"width":66,"height":7}},{"id":"58346b8e-2e7f-453b-94c3-5d9b0636c426","block_type":"box","text":"Shares","page_number":42,"box":{"x":841,"y":618,"width":39,"height":8}},{"id":"dffc52d1-61d1-4ade-ae7f-63954b4c595e","block_type":"box","text":"Net Assets","page_number":42,"box":{"x":70,"y":636,"width":76,"height":9}},{"id":"eaad4cae-1b19-4a04-95f3-bb0eb9a444d4","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,","page_number":42,"box":{"x":155,"y":635,"width":528,"height":12}},{"id":"b38bae55-35fc-4889-a71c-d80ce20aec58","block_type":"box","text":"227,609,297 $13,568.091","page_number":42,"box":{"x":685,"y":635,"width":224,"height":12}},{"id":"5d4f9b62-afe4-4b87-913a-33a6e6e2c293","block_type":"box","text":"Number of Shares Outstanding","page_number":42,"box":{"x":70,"y":651,"width":219,"height":12}},{"id":"8f39647f-b937-4059-a153-581b8c778031","block_type":"box","text":"..........................................","page_number":42,"box":{"x":293,"y":659,"width":336,"height":1}},{"id":"73fa12b4-1c96-4e8e-9224-f18c35730470","block_type":"box","text":"122,248,986 1,352,339","page_number":42,"box":{"x":686,"y":651,"width":223,"height":11}},{"id":"2a0c34d1-d14f-40ab-a450-77c200cebd23","block_type":"box","text":"Net Asset Value Per Share (net assets divided by number of shares","page_number":42,"box":{"x":70,"y":666,"width":478,"height":12}},{"id":"16262b65-3c0b-4629-be36-61302ad73c66","block_type":"box","text":"outstanding)","page_number":42,"box":{"x":79,"y":681,"width":87,"height":11}},{"id":"59fbbfaf-dddb-438b-bb3c-f2a12b7596a6","block_type":"box","text":".........................................................","page_number":42,"box":{"x":171,"y":688,"width":458,"height":2}},{"id":"9b65abcf-5dcd-463a-acf1-39c707b562e9","block_type":"box","text":"$10.04 $10.03","page_number":42,"box":{"x":730,"y":680,"width":179,"height":11}},{"id":"74faa6bd-85f2-4378-b98a-87a8602cd5cb","block_type":"box","text":"Sales Charge (for Investor A and Investor A1 shares: 4.00% and 1.00% of","page_number":42,"box":{"x":69,"y":696,"width":526,"height":11}},{"id":"53ef9bff-f66a-446d-aa41-b202acc7c6f3","block_type":"box","text":"offering price; 4.17% and 1.01% of net asset value per share, respectively)","page_number":42,"box":{"x":79,"y":710,"width":535,"height":12}},{"id":"18402906-8063-451b-a2aa-e83efd6dc76b","block_type":"box","text":"1","page_number":42,"box":{"x":615,"y":711,"width":4,"height":4}},{"id":"5c01e882-94d4-4ee2-b829-cfb615f1ce7d","block_type":"box","text":". $0.42 $0.10","page_number":42,"box":{"x":628,"y":710,"width":281,"height":10}},{"id":"3c807a77-91a9-45d9-95fa-ecdf6f6c0cdd","block_type":"box","text":"Offering Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .","page_number":42,"box":{"x":69,"y":730,"width":560,"height":11}},{"id":"8c51bc9d-dbf3-495a-8b78-ccf2a519a671","block_type":"box","text":"$10.46 $10.13","page_number":42,"box":{"x":730,"y":729,"width":179,"height":11}},{"id":"e73b5c66-a865-417d-8a2a-206384f963b8","block_type":"box","text":"1","page_number":42,"box":{"x":69,"y":762,"width":3,"height":4}},{"id":"8c8b2bdb-a039-4350-a26c-6d34a664cd3f","block_type":"box","text":"Rounded to the nearest one-hundredth percent; assumes maximum sales charge is applicable.","page_number":42,"box":{"x":94,"y":762,"width":541,"height":9}},{"id":"07cc1ab2-e0ca-4862-a5fe-e843195ceda1","block_type":"box","text":"VII. Portfolio Transactions and Brokerage","page_number":42,"box":{"x":68,"y":791,"width":302,"height":11}},{"id":"6fb42f75-b87b-44ca-bb92-4262bf160e89","block_type":"box","text":"See “Por tfolio Transactions and Brokerage” in Par t II of this Statement of Additional Information for more","page_number":42,"box":{"x":102,"y":813,"width":750,"height":11}},{"id":"386d244c-2c07-414d-b3f1-7f5ec2092814","block_type":"box","text":"information.","page_number":42,"box":{"x":70,"y":828,"width":83,"height":9}},{"id":"5aef82ed-373b-4152-b290-d9aec63a2f07","block_type":"box","text":"I-26","page_number":42,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"e6c2e7b8-29d3-4a48-9394-cfa7a1ea926a","block_type":"box","text":"NM1026U-6033063-42/246","page_number":42,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"eb1beccf-7d11-46b0-8844-20887d301e86","block_type":"box","text":"Information about the brokerage commissions paid by the Fund and prior to September 16, 2024, brokerage","page_number":43,"box":{"x":102,"y":45,"width":774,"height":11}},{"id":"a015a938-fb24-4e10-8c70-d6d0253bb35a","block_type":"box","text":"commissions paid by the Master Por tfolio, including commissions paid to Affiliates, for the last three fiscal years is","page_number":43,"box":{"x":69,"y":60,"width":823,"height":11}},{"id":"a03cb313-5989-4354-92c0-bc970edd5a99","block_type":"box","text":"set for th in the following table:","page_number":43,"box":{"x":69,"y":75,"width":217,"height":11}},{"id":"99ec70d0-b0f6-47dd-8af5-244711568065","block_type":"box","text":"Aggregate Brokerage","page_number":43,"box":{"x":613,"y":103,"width":125,"height":9}},{"id":"5cb77000-8a6d-422b-a746-a2caa121924b","block_type":"box","text":"Commissions Paid","page_number":43,"box":{"x":623,"y":113,"width":106,"height":7}},{"id":"2c3c227d-ee3d-4f84-87f6-c7b20f153b4f","block_type":"box","text":"Brokerage Commissions","page_number":43,"box":{"x":769,"y":103,"width":140,"height":9}},{"id":"a2526ba3-852a-449c-a2aa-75fe2cd63563","block_type":"box","text":"Paid to Affiliates","page_number":43,"box":{"x":791,"y":113,"width":96,"height":7}},{"id":"ce930cb2-63a9-4032-a3ae-1af9db404fce","block_type":"box","text":"Fiscal Year Ended September 30, 2025. .","page_number":43,"box":{"x":70,"y":131,"width":292,"height":11}},{"id":"8270c968-a50c-4feb-884a-51a6bb348186","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . $5,","page_number":43,"box":{"x":369,"y":130,"width":286,"height":11}},{"id":"d2a07e3e-fafa-44f4-af15-372fc5ba10ea","block_type":"box","text":"604,125 $0","page_number":43,"box":{"x":657,"y":130,"width":191,"height":11}},{"id":"db06f9a9-d35b-49d8-876e-10af72298abc","block_type":"box","text":"Fiscal Year Ended September 30, 2024. .","page_number":43,"box":{"x":70,"y":146,"width":292,"height":11}},{"id":"15d68b4e-ad9e-42ea-8f81-d66128005710","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . $5,","page_number":43,"box":{"x":369,"y":145,"width":286,"height":12}},{"id":"c7022835-e4ff-42f4-ac67-5135d94ea5c5","block_type":"box","text":"552,879 $0","page_number":43,"box":{"x":657,"y":145,"width":191,"height":12}},{"id":"596e3773-a55a-46cd-b359-26e534b4d39d","block_type":"box","text":"Fiscal Year Ended September 30, 2023. .","page_number":43,"box":{"x":70,"y":161,"width":292,"height":11}},{"id":"577152ff-f899-49c8-9f46-6794adad5295","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . $4,","page_number":43,"box":{"x":369,"y":161,"width":286,"height":11}},{"id":"fd529f1d-bfd4-422a-8abf-8c671af12e30","block_type":"box","text":"286,977 $0","page_number":43,"box":{"x":657,"y":161,"width":191,"height":11}},{"id":"abbb2a5a-08a7-47c0-9a58-4770edf004f7","block_type":"box","text":"The following table shows the dollar amount of brokerage commissions paid by the Fund to brokers for providing","page_number":43,"box":{"x":101,"y":185,"width":800,"height":11}},{"id":"f10005d3-e146-438d-bd55-3cbe0927eaea","block_type":"box","text":"third-par ty research services and the approximate dollar amount of the transactions involved for the fiscal year ended","page_number":43,"box":{"x":68,"y":200,"width":838,"height":11}},{"id":"9c0c8df1-c859-4dc8-950e-945de082d3c4","block_type":"box","text":"September 30, 2025. The provision of third-par ty research services was not necessarily a factor in the placement of","page_number":43,"box":{"x":69,"y":215,"width":832,"height":11}},{"id":"888f7b7c-2dbe-4720-8771-3813991e45b3","block_type":"box","text":"all brokerage business with such brokers.","page_number":43,"box":{"x":69,"y":231,"width":296,"height":11}},{"id":"7ed0e638-1c6a-4bf9-a26d-071bbdf76912","block_type":"box","text":"Amount of Commissions","page_number":43,"box":{"x":357,"y":259,"width":141,"height":7}},{"id":"e3b681f3-ea29-4db1-bec5-821d5da163fe","block_type":"box","text":"Paid to Brokers for","page_number":43,"box":{"x":374,"y":269,"width":109,"height":7}},{"id":"87e74bcf-0fdf-4d73-8596-ac56bd814cd9","block_type":"box","text":"Providing 28(e) Eligible Research Services","page_number":43,"box":{"x":304,"y":279,"width":249,"height":9}},{"id":"63c043ad-9a0d-42ff-8bc9-986bfb7df0df","block_type":"box","text":"Amount of Brokerage","page_number":43,"box":{"x":593,"y":269,"width":124,"height":9}},{"id":"c5a7eb3b-15f2-47fa-a58c-ce65de55b8f5","block_type":"box","text":"Transactions Involved","page_number":43,"box":{"x":592,"y":279,"width":126,"height":7}},{"id":"f5cb9fe4-58ec-4d8d-9d5c-047bb86c10df","block_type":"box","text":"$205,453 $542,064,196","page_number":43,"box":{"x":392,"y":296,"width":316,"height":11}},{"id":"c1960d1d-96af-4c38-9a3d-af03e7b8a551","block_type":"box","text":"As of September 30, 2025, the value of the Fund’s aggregate holdings of the securities of its regular brokers or","page_number":43,"box":{"x":101,"y":321,"width":799,"height":11}},{"id":"85de2ab6-42cf-4428-89d7-58314495389d","block_type":"box","text":"dealers (as defined in Rule 10b-1 under the Investment Company Act) or their parents, if any por tion of such holdings","page_number":43,"box":{"x":69,"y":336,"width":837,"height":11}},{"id":"1cdbff51-5ec3-4e39-8842-1b9474f0a7a4","block_type":"box","text":"were purchased during the fiscal year ended September 30, 2025, is as follows:","page_number":43,"box":{"x":68,"y":351,"width":575,"height":11}},{"id":"c6107dca-a195-4a09-921e-bba84d1bdd67","block_type":"box","text":"Regular Broker/Dealer Debt (D)/Equity (E) Aggregate Holdings (000’s)","page_number":43,"box":{"x":69,"y":379,"width":840,"height":9}},{"id":"98b4b924-5984-44d2-8f72-d574729375cf","block_type":"box","text":"J.P. Morgan Securities LLC . .","page_number":43,"box":{"x":69,"y":397,"width":209,"height":11}},{"id":"f37f3785-b985-4e51-a9bc-ad4c05cbbc07","block_type":"box","text":".................................... D","page_number":43,"box":{"x":284,"y":397,"width":380,"height":9}},{"id":"58bfbe4a-4ed7-49c2-a487-ae2905b067e7","block_type":"box","text":"$421,084","page_number":43,"box":{"x":792,"y":396,"width":72,"height":11}},{"id":"295143aa-db48-4700-8ab5-acd0e26f191c","block_type":"box","text":"Morgan Stanley & Co., LLC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . D","page_number":43,"box":{"x":70,"y":412,"width":594,"height":11}},{"id":"e3c31168-1029-404e-b05a-b093207bbde0","block_type":"box","text":"$261,703","page_number":43,"box":{"x":792,"y":411,"width":72,"height":11}},{"id":"b0db36c5-9eb4-47a4-9f01-7707e65eda2a","block_type":"box","text":"Goldman Sachs & Co.","page_number":43,"box":{"x":69,"y":427,"width":155,"height":9}},{"id":"5106750d-ea82-42ca-abf0-8e987ac05119","block_type":"box","text":"........................................... D","page_number":43,"box":{"x":227,"y":427,"width":437,"height":9}},{"id":"8ce89765-e40f-4e70-9eac-2e471aa870ee","block_type":"box","text":"$172,168","page_number":43,"box":{"x":792,"y":426,"width":72,"height":11}},{"id":"929c8ace-b291-4346-bfda-dcaca7829107","block_type":"box","text":"BofA Securities, Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . D","page_number":43,"box":{"x":70,"y":442,"width":594,"height":11}},{"id":"4ca20dee-c100-42c7-aa3a-a06409172f57","block_type":"box","text":"$125,362","page_number":43,"box":{"x":792,"y":441,"width":72,"height":12}},{"id":"9415e9e2-39c3-42a9-86bf-65eb89c69163","block_type":"box","text":"Citigroup Global Markets, Inc. . . . . . . . . .","page_number":43,"box":{"x":69,"y":457,"width":282,"height":12}},{"id":"80626eb1-8446-46fb-be0b-b71648a59004","block_type":"box","text":"........................... D","page_number":43,"box":{"x":357,"y":457,"width":307,"height":9}},{"id":"af56859d-1c47-42ac-bebe-830fd25704e0","block_type":"box","text":"$108,383","page_number":43,"box":{"x":792,"y":457,"width":72,"height":11}},{"id":"f6d4493f-d423-4264-bcbb-bb13b316eec7","block_type":"box","text":"Wells Fargo Securities LLC","page_number":43,"box":{"x":68,"y":472,"width":189,"height":12}},{"id":"016c3572-3dc2-4093-a1f7-5379821acf99","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . D $ 53,892","page_number":43,"box":{"x":268,"y":472,"width":596,"height":11}},{"id":"2ae32687-1b2d-495c-98db-23b1b74c4393","block_type":"box","text":"UBS Securities LLC. . . . . . . . . . . . . . . . . . . .","page_number":43,"box":{"x":70,"y":488,"width":297,"height":8}},{"id":"39def6bb-11b4-494e-9e16-7e641be6c617","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . D $ 4,667","page_number":43,"box":{"x":374,"y":487,"width":490,"height":11}},{"id":"80b814ae-5f5b-4fd9-900c-52cd062622cb","block_type":"box","text":"Citadel Securities LLC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . D $ 2,837","page_number":43,"box":{"x":69,"y":502,"width":795,"height":11}},{"id":"751c29ce-ea9d-4437-932e-6d3df0ec324d","block_type":"box","text":"BNP Paribas Securities Corp. .","page_number":43,"box":{"x":70,"y":518,"width":216,"height":11}},{"id":"bc4128c0-3a41-497b-9021-d9e40ffa5e30","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . D $ 455","page_number":43,"box":{"x":292,"y":517,"width":572,"height":11}},{"id":"e0ec90e3-ab2c-4e41-a9ec-6e452d960090","block_type":"box","text":"Barclays Capital, Inc.","page_number":43,"box":{"x":70,"y":533,"width":147,"height":11}},{"id":"1290c5c0-5e29-46c9-8ff8-c3f8990f8c47","block_type":"box","text":"........................................... E","page_number":43,"box":{"x":227,"y":533,"width":437,"height":9}},{"id":"f4c681fa-be29-430a-8f8b-9fcef2ebda64","block_type":"box","text":"$411,015","page_number":43,"box":{"x":792,"y":532,"width":72,"height":11}},{"id":"f4e14aba-11fa-47ba-a955-5113d719bd56","block_type":"box","text":"Citigroup Global Markets, Inc. . . . . . . . . .","page_number":43,"box":{"x":69,"y":548,"width":282,"height":11}},{"id":"d1a56f90-227e-4b48-8b8b-099cd7b165be","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . E $ 1,729","page_number":43,"box":{"x":357,"y":547,"width":507,"height":11}},{"id":"10f5924a-5393-45a0-a91c-cda5085ed96a","block_type":"box","text":"The Subsidiary follows the same brokerage practices as the Fund and prior to September 16, 2024, the Master","page_number":43,"box":{"x":101,"y":572,"width":798,"height":11}},{"id":"0f7aa395-2ce7-45a6-acfc-64b7a86897e2","block_type":"box","text":"Por tfolio.","page_number":43,"box":{"x":69,"y":587,"width":63,"height":9}},{"id":"e5223632-6301-4e90-87cb-165515e17878","block_type":"box","text":"Securities Lending","page_number":43,"box":{"x":70,"y":617,"width":131,"height":12}},{"id":"70d6a842-87ef-42aa-9961-938fa0828eda","block_type":"box","text":"To the extent that the Fund engages in securities lending, the Fund conducts its securities lending pursuant to an","page_number":43,"box":{"x":101,"y":640,"width":807,"height":11}},{"id":"1d2b0558-3639-422d-a06e-000c7030baeb","block_type":"box","text":"exemptive order from the Commission permitting it to lend por tfolio securities to borrowers affiliated with the Fund","page_number":43,"box":{"x":69,"y":655,"width":817,"height":11}},{"id":"e9455e07-53fd-4bd3-9174-03033846880e","block_type":"box","text":"and to retain an affiliate of the Fund as securities lending agent. To the extent that the Fund engages in securities","page_number":43,"box":{"x":69,"y":670,"width":813,"height":11}},{"id":"81621701-2e18-40c1-81d3-539bb8df325b","block_type":"box","text":"lending, BlackRock Investment Management, LLC (“BIM”) acts as securities lending agent for the Fund, subject to the","page_number":43,"box":{"x":70,"y":685,"width":838,"height":12}},{"id":"58b768c0-8f1f-4f61-a567-586988d1eae5","block_type":"box","text":"overall supervision of the Manager, pursuant to a written agreement (the “Securities Lending Agency Agreement”)","page_number":43,"box":{"x":69,"y":700,"width":809,"height":12}},{"id":"58cccda5-7dc6-4de0-816a-6757c1ae1190","block_type":"box","text":"BIM administers the lending program in accordance with guidelines approved by the Fund’s Board.","page_number":43,"box":{"x":70,"y":716,"width":699,"height":11}},{"id":"d7eb0f37-237f-4d01-a537-8a26b4b7cffb","block_type":"box","text":"The Fund retains a por tion of the securities lending income and remits a remaining por tion to BIM as","page_number":43,"box":{"x":101,"y":738,"width":721,"height":11}},{"id":"60d61bc2-ad01-4bbb-a926-70c36c2a99f5","block_type":"box","text":"compensation for its services as securities lending agent. Securities lending income is generally equal to the total of","page_number":43,"box":{"x":69,"y":753,"width":834,"height":12}},{"id":"1d0770eb-daba-4cb0-9dbc-543e6707d609","block_type":"box","text":"income earned from the reinvestment of cash collateral (and excludes collateral investment fees as defined below),","page_number":43,"box":{"x":70,"y":768,"width":822,"height":11}},{"id":"6b7343fd-bd80-4ba1-9d6c-3f39d8aa9653","block_type":"box","text":"and any fees or other payments to and from borrowers of securities. As securities lending agent, BIM bears all","page_number":43,"box":{"x":69,"y":783,"width":787,"height":12}},{"id":"a49acbfa-fe82-4589-b057-64e5264d6e3a","block_type":"box","text":"operational costs directly related to securities lending. The Fund is responsible for fees in connection with the","page_number":43,"box":{"x":69,"y":799,"width":783,"height":11}},{"id":"4cde16b0-f2b1-4c25-a203-fe643bc28c14","block_type":"box","text":"investment of cash collateral received for securities on loan in a money market fund managed by BlackRock (the","page_number":43,"box":{"x":70,"y":814,"width":800,"height":11}},{"id":"268d135e-cbeb-439d-9aaf-d7cd07a655bf","block_type":"box","text":"“collateral investment fees“); however, the securities lending agent has agreed to reduce the amount of securities","page_number":43,"box":{"x":70,"y":829,"width":813,"height":11}},{"id":"11de1b07-f88d-4b47-8ed5-a1735aef73a4","block_type":"box","text":"lending income it receives in order to effectively limit the collateral investment fees a Fund bears to an annual rate of","page_number":43,"box":{"x":70,"y":844,"width":836,"height":11}},{"id":"68695e6e-d1b7-4e0d-8310-68c3fc99434a","block_type":"box","text":"0.04%. Such money market fund shares will not be subject to a sales load, distribution fee or service fee.","page_number":43,"box":{"x":69,"y":859,"width":755,"height":11}},{"id":"6920b4f6-59bf-42da-8aec-c31083f77e1e","block_type":"box","text":"To the extent that the Fund invests cash collateral in a non-government money market fund, the Fund may be","page_number":43,"box":{"x":101,"y":882,"width":776,"height":11}},{"id":"8f1cd52f-cf09-406d-8a11-7ab05ef4d782","block_type":"box","text":"subject to a discretionary liquidity fee of up to 2% on all redemptions. Discretionary liquidity fees may be imposed or","page_number":43,"box":{"x":69,"y":897,"width":831,"height":11}},{"id":"1c65dc3b-f937-44c6-8454-87c7c7fe0e46","block_type":"box","text":"terminated at any time at the discretion of the board of directors of the money market fund, or its delegate, if it is","page_number":43,"box":{"x":68,"y":912,"width":812,"height":11}},{"id":"a2b90ade-9054-43ae-9b7b-34368e0d8f47","block_type":"box","text":"I-27","page_number":43,"box":{"x":476,"y":943,"width":26,"height":9}},{"id":"21a65d6a-a9f6-42bb-9756-957ebd21c58b","block_type":"box","text":"NM1026U-6033063-43/246","page_number":43,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"90163ee0-a7ab-4527-9f4b-e1c4852d456f","block_type":"box","text":"determined that such fee would be, or would not be, respectively, in the best interest of the money market fund.","page_number":44,"box":{"x":69,"y":45,"width":799,"height":11}},{"id":"fc4d6554-7211-425e-ab03-219b8b42b60a","block_type":"box","text":"Additionally, the Fund will be subject to a mandatory liquidity fee if the money market fund’s total net redemptions on","page_number":44,"box":{"x":68,"y":60,"width":835,"height":11}},{"id":"0a96b974-49a4-4a07-b7e0-2e494c1a6c90","block_type":"box","text":"a single day exceed 5% of the money market fund’s net assets, unless the liquidity costs are de minimis (i.e., less","page_number":44,"box":{"x":69,"y":75,"width":818,"height":11}},{"id":"e1450d28-8b88-4fed-a85f-8d751bc3c1f1","block_type":"box","text":"than one basis point (0.01%)). The money market fund will determine the size of the mandatory liquidity fee by","page_number":44,"box":{"x":68,"y":90,"width":789,"height":11}},{"id":"ad2de386-94d9-4c69-a27f-0af4f9dd7fd3","block_type":"box","text":"making a good faith estimate of cer tain costs the money market fund would incur if it were to sell a pro rata amount","page_number":44,"box":{"x":69,"y":105,"width":829,"height":11}},{"id":"e2ebe63e-0dbc-47c9-9578-ad0403afc364","block_type":"box","text":"of each security in the por tfolio to satisfy the amount of net redemptions on that day. There is no limit to the size of a","page_number":44,"box":{"x":69,"y":120,"width":839,"height":11}},{"id":"0690786d-29c9-42c7-a52c-8eaa10f0a6ec","block_type":"box","text":"mandatory liquidity fee. If the money market fund cannot estimate the costs of selling a pro rata amount of each","page_number":44,"box":{"x":69,"y":135,"width":802,"height":12}},{"id":"b5f02529-a244-4341-b3f0-09c2fc5cba2a","block_type":"box","text":"por tfolio security in good faith and suppor ted by data, it is required to apply a default liquidity fee of 1% on the value","page_number":44,"box":{"x":70,"y":150,"width":830,"height":12}},{"id":"a01f8038-e7fb-4a14-acd8-86ce388a3e8b","block_type":"box","text":"of shares redeemed on that day. The imposition of any such discretionary or mandatory liquidity fee would reduce the","page_number":44,"box":{"x":69,"y":166,"width":838,"height":11}},{"id":"d4252b6c-f889-42c7-8544-b2f09e631c53","block_type":"box","text":"Fund’s returns on securities lending.","page_number":44,"box":{"x":70,"y":181,"width":258,"height":11}},{"id":"0adb63d0-5186-4701-9053-2691dcbb1c58","block_type":"box","text":"Under the securities lending program, the Fund is categorized into one of several specific asset classes. The","page_number":44,"box":{"x":102,"y":203,"width":774,"height":12}},{"id":"622482c6-dad2-419c-af6f-e82193bc84aa","block_type":"box","text":"determination of the Fund’s asset class category (fixed income, domestic equity, international equity, or fund of","page_number":44,"box":{"x":69,"y":218,"width":796,"height":12}},{"id":"e75775a6-07f4-4bbc-b47c-986c0bbea146","block_type":"box","text":"funds), each of which may be subject to a different fee arrangement, is based on a methodology agreed to by the","page_number":44,"box":{"x":68,"y":234,"width":809,"height":11}},{"id":"237bcce8-0c18-46c2-81f0-59ce09b58a25","block_type":"box","text":"Corporation and BIM.","page_number":44,"box":{"x":69,"y":249,"width":149,"height":11}},{"id":"74d3d258-900f-4193-849c-fc3b33c43514","block_type":"box","text":"Pursuant to the current securities lending agreement: (i) the Fund retains 81% of securities lending income","page_number":44,"box":{"x":102,"y":271,"width":761,"height":12}},{"id":"7c607bcd-ac5c-42a4-928e-8a36852f6457","block_type":"box","text":"(which excludes collateral investment expenses), and (ii) this amount can never be less than 70% of the sum of","page_number":44,"box":{"x":69,"y":286,"width":796,"height":12}},{"id":"488a5318-2d2c-4bfc-8096-5e82d95b40b0","block_type":"box","text":"securities lending income plus collateral investment expenses.","page_number":44,"box":{"x":69,"y":302,"width":446,"height":11}},{"id":"03c001c1-1b5f-4dc5-b34e-58bdcb159fad","block_type":"box","text":"In addition, commencing the business day following the date that the aggregate securities lending income","page_number":44,"box":{"x":102,"y":324,"width":753,"height":12}},{"id":"8f1614fa-ad5c-4588-a33f-dfc79cb1bef3","block_type":"box","text":"earned across the BlackRock Fixed-Income Complex in a calendar year exceeds a specified threshold, the Fund,","page_number":44,"box":{"x":69,"y":339,"width":796,"height":12}},{"id":"ea13c0d3-d55c-47a9-86c6-b3a3123321f9","block_type":"box","text":"pursuant to the current securities lending agreement, will receive for the remainder of that calendar year securities","page_number":44,"box":{"x":70,"y":355,"width":817,"height":11}},{"id":"041e0707-9915-4cc2-a1ff-b4f19044ffc7","block_type":"box","text":"lending income as follows: (i) 84% of securities lending income (which excludes collateral investment expenses); and","page_number":44,"box":{"x":70,"y":370,"width":831,"height":11}},{"id":"cfc47720-b459-4c33-8be8-8f72aecc9833","block_type":"box","text":"(ii) this amount can never be less than 70% of the sum of securities lending income plus collateral investment","page_number":44,"box":{"x":69,"y":385,"width":786,"height":11}},{"id":"32ef5b0b-eb79-4ea0-ab36-cab9e6ca9166","block_type":"box","text":"expenses.","page_number":44,"box":{"x":69,"y":402,"width":71,"height":9}},{"id":"e0d919d6-d69c-4910-9f76-464f17180519","block_type":"box","text":"Prior to January 1, 2025, the Fund was subject to a different securities lending fee arrangement.","page_number":44,"box":{"x":102,"y":423,"width":690,"height":11}},{"id":"798910fb-a9be-4591-83b9-8788aebabf39","block_type":"box","text":"Prior to September 16, 2024, the Fund invested all of its assets in the Master Por tfolio and the securities","page_number":44,"box":{"x":102,"y":445,"width":756,"height":11}},{"id":"7d15de6d-bb26-486d-9691-ca52e1a17c3a","block_type":"box","text":"lending was done at the Master Por tfolio level. The information shown below for the Fund reflects the “master/","page_number":44,"box":{"x":70,"y":460,"width":792,"height":12}},{"id":"200849c4-ed76-4aab-9e26-f7a74d015faa","block_type":"box","text":"feeder” structure in place prior to September 16, 2024.","page_number":44,"box":{"x":68,"y":475,"width":398,"height":11}},{"id":"af8d0b14-c610-423d-b6f0-6bdc586d8a80","block_type":"box","text":"The services provided to the Fund by BIM, in the most recent fiscal year ended September 30, 2025, primarily","page_number":44,"box":{"x":101,"y":498,"width":788,"height":11}},{"id":"f6fb8a2f-427d-47de-aeb5-68c7fc9e552c","block_type":"box","text":"included the following:","page_number":44,"box":{"x":70,"y":513,"width":156,"height":12}},{"id":"c2b63c23-8657-498a-abd7-3b67fdd0ae53","block_type":"box","text":"(1) selecting borrowers from an approved list of borrowers and executing a securities lending agreement as agent","page_number":44,"box":{"x":69,"y":533,"width":818,"height":12}},{"id":"21c26603-d769-4521-ac61-48597f4dd675","block_type":"box","text":"on behalf of the Fund with each such borrower;","page_number":44,"box":{"x":102,"y":549,"width":333,"height":10}},{"id":"07c2e73f-4c5b-4da4-8d7b-1f58672d37b6","block_type":"box","text":"(2) negotiating the terms of securities loans, including the amount of fees;","page_number":44,"box":{"x":69,"y":569,"width":538,"height":11}},{"id":"0d4b728f-5d70-47fa-b6da-dcd237b2752f","block_type":"box","text":"(3) directing the delivery of loaned securities;","page_number":44,"box":{"x":69,"y":589,"width":330,"height":11}},{"id":"4524b37e-bed2-4468-b219-4bc13493f13c","block_type":"box","text":"(4) monitoring the daily value of the loaned securities and directing the payment of additional collateral or the return","page_number":44,"box":{"x":69,"y":609,"width":834,"height":11}},{"id":"505c9d29-81ba-47cf-a7a6-a6ab342423c4","block_type":"box","text":"of excess collateral, as necessary;","page_number":44,"box":{"x":102,"y":624,"width":246,"height":11}},{"id":"dd25877a-5b28-4b2d-b771-31a465196d40","block_type":"box","text":"(5) investing cash collateral received in connection with any loaned securities;","page_number":44,"box":{"x":69,"y":645,"width":562,"height":11}},{"id":"01a30da9-50ca-45a8-8cc2-4754898cb13d","block_type":"box","text":"(6) monitoring distributions on loaned securities (for example, interest and dividend activity);","page_number":44,"box":{"x":69,"y":664,"width":665,"height":12}},{"id":"10479561-4766-42b6-babb-acf60b33ad47","block_type":"box","text":"(7) in the event of default by a borrower with respect to any securities loan, using the collateral or the proceeds of","page_number":44,"box":{"x":69,"y":685,"width":822,"height":11}},{"id":"2e33ab6f-99cd-4ca0-826c-6f054196dc5a","block_type":"box","text":"the liquidation of collateral to purchase replacement securities of the same issue, type, class and series as that","page_number":44,"box":{"x":101,"y":700,"width":803,"height":11}},{"id":"1b8abed2-f286-417b-81c9-e4dbe898887f","block_type":"box","text":"of the loaned securities; and","page_number":44,"box":{"x":102,"y":715,"width":203,"height":10}},{"id":"4f62bbcf-8d87-49db-a5a1-476e6fed5303","block_type":"box","text":"(8) terminating securities loans and arranging for the return of loaned securities to the Fund at loan termination.","page_number":44,"box":{"x":69,"y":735,"width":808,"height":11}},{"id":"bb312e2c-b58a-4484-9922-c658483ff4b2","block_type":"box","text":"I-28","page_number":44,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"66e5f396-9f92-4a60-b656-4d3d05c1d9a0","block_type":"box","text":"NM1026U-6033063-44/246","page_number":44,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"c3b88ec1-a7fd-454f-b516-d3bddbedcd44","block_type":"box","text":"The following table shows the dollar amounts of income and fees/compensation related to the securities lending","page_number":45,"box":{"x":101,"y":45,"width":805,"height":11}},{"id":"67d4c4c4-f277-4102-8c64-7c2232bcbe4e","block_type":"box","text":"activities of the Fund during its most recent fiscal year ended September 30, 2025.","page_number":45,"box":{"x":69,"y":60,"width":595,"height":11}},{"id":"10f2bf26-3a53-448b-a022-fbaae9f198af","block_type":"box","text":"Total Return Portfolio","page_number":45,"box":{"x":784,"y":88,"width":125,"height":7}},{"id":"c1d80e5e-64af-4822-ba1c-381b64eb1eec","block_type":"box","text":"Gross income from securities lending activities","page_number":45,"box":{"x":69,"y":106,"width":343,"height":11}},{"id":"7c7d3a08-e41c-49f4-9d86-b0b8c4b8a404","block_type":"box","text":"...........................................","page_number":45,"box":{"x":419,"y":113,"width":344,"height":2}},{"id":"4eb9cc7a-d839-4a6c-bd81-88231fc7338a","block_type":"box","text":"$524,231","page_number":45,"box":{"x":811,"y":105,"width":72,"height":12}},{"id":"a221630d-3c0b-413a-9bff-a77b2bdce068","block_type":"box","text":"Fees and/or compensation for securities lending activities and related services","page_number":45,"box":{"x":70,"y":125,"width":565,"height":12}},{"id":"4ec3afdc-5366-4812-8623-1eca61d13954","block_type":"box","text":"Securities lending income paid to BIM for services as securities lending agent .","page_number":45,"box":{"x":79,"y":140,"width":570,"height":12}},{"id":"8b4be5f4-4b63-4f31-913f-ef381d4869b0","block_type":"box","text":". . . . . . . . . . . . . . $ 14,618","page_number":45,"box":{"x":655,"y":140,"width":228,"height":11}},{"id":"66e61436-df8c-4d54-92fd-28e91f8743dc","block_type":"box","text":"Cash collateral management expenses not included in securities lending income paid to BIM . . . $ 4,470","page_number":45,"box":{"x":79,"y":155,"width":804,"height":12}},{"id":"bef50ef8-134e-4eaf-901b-2e96510412a0","block_type":"box","text":"Administrative fees not included in securities lending income paid to BIM","page_number":45,"box":{"x":78,"y":171,"width":519,"height":11}},{"id":"9f5ad824-d80b-4eb9-a254-337f69859819","block_type":"box","text":".................... $ 0","page_number":45,"box":{"x":606,"y":170,"width":277,"height":10}},{"id":"99e2809c-da4a-447d-8a69-9e5daaa0b2a4","block_type":"box","text":"Indemnification fees not included in securities lending income paid to BIM .","page_number":45,"box":{"x":79,"y":186,"width":537,"height":11}},{"id":"bc9e975c-98c4-4cad-9627-6cbea1d334de","block_type":"box","text":".................. $ 0","page_number":45,"box":{"x":623,"y":185,"width":260,"height":11}},{"id":"23e7882e-75b9-4b32-9f3a-0c285d60791d","block_type":"box","text":"Rebates (paid to borrowers) . . . . . . . . . . . .","page_number":45,"box":{"x":79,"y":201,"width":293,"height":11}},{"id":"a08cd803-23ea-4910-93cc-5f277a96e298","block_type":"box","text":"................................................","page_number":45,"box":{"x":378,"y":208,"width":385,"height":2}},{"id":"5170a8fb-b0ea-4d7b-aa73-19447967e1e1","block_type":"box","text":"$437,357","page_number":45,"box":{"x":811,"y":200,"width":71,"height":11}},{"id":"f20ccdad-cc87-4688-ade3-db9006711d52","block_type":"box","text":"Other fees not included in securities lending income paid to BIM . . .","page_number":45,"box":{"x":79,"y":216,"width":480,"height":11}},{"id":"73b24783-9109-4443-83a8-55b56cf6d049","block_type":"box","text":"......................... $ 0","page_number":45,"box":{"x":566,"y":215,"width":317,"height":11}},{"id":"9b005a7b-975d-4fa5-aaf3-4816ea8cc710","block_type":"box","text":"Aggregate fees/compensation for securities lending activities","page_number":45,"box":{"x":68,"y":231,"width":455,"height":11}},{"id":"0f9600cd-0254-4db3-bd2e-1a544155fb7d","block_type":"box","text":"..............................","page_number":45,"box":{"x":525,"y":239,"width":238,"height":1}},{"id":"c35e44cd-362c-496f-a7fa-45509835b4d7","block_type":"box","text":"$456,445","page_number":45,"box":{"x":811,"y":230,"width":72,"height":12}},{"id":"95563a27-f58b-4945-b194-cbcce9a25b9b","block_type":"box","text":"Net income from securities lending activities","page_number":45,"box":{"x":69,"y":251,"width":327,"height":11}},{"id":"cd24a126-fc11-4a88-b001-c723357d872e","block_type":"box","text":".............................................","page_number":45,"box":{"x":403,"y":258,"width":360,"height":2}},{"id":"459cfeaa-7be5-4b2b-9049-abea4fcdc0e9","block_type":"box","text":"$ 67,786","page_number":45,"box":{"x":811,"y":250,"width":72,"height":12}},{"id":"db104cd3-4cd2-445c-bfd0-5d4bb9dae0a5","block_type":"box","text":"VIII. Additional Information","page_number":45,"box":{"x":68,"y":287,"width":195,"height":9}},{"id":"66250135-f48a-48ff-8b8a-27c81d43df5b","block_type":"box","text":"Description of Shares","page_number":45,"box":{"x":69,"y":317,"width":156,"height":11}},{"id":"b09452d2-5cfc-4bc7-8e33-f14554c4d012","block_type":"box","text":"The Corporation is a diversified, open-end management investment company organized under the laws of the","page_number":45,"box":{"x":101,"y":339,"width":775,"height":12}},{"id":"3ba014da-63d1-4ea6-92dd-520db6e1c88e","block_type":"box","text":"State of Maryland that commenced operations on November 10, 1978 as the Merrill Lynch High Income Fund, Inc.,","page_number":45,"box":{"x":69,"y":355,"width":821,"height":11}},{"id":"c446c480-2b51-4221-826c-77be056c1896","block_type":"box","text":"consisting solely of the High Income Por tfolio. The Corporation was reorganized on September 8, 1980 to change its","page_number":45,"box":{"x":69,"y":370,"width":831,"height":11}},{"id":"d1f8154e-cf0e-4c73-95dd-2a27b513c3eb","block_type":"box","text":"name from the Merrill Lynch High Income Fund, Inc. to the Merrill Lynch Corporate Bond Fund, Inc. and to add the","page_number":45,"box":{"x":69,"y":385,"width":809,"height":11}},{"id":"c81b6f5e-f994-49dd-83aa-3920d5d3a690","block_type":"box","text":"High Quality Por tfolio and the Intermediate Term Por tfolio. The High Quality Por tfolio and the Intermediate Term","page_number":45,"box":{"x":70,"y":400,"width":791,"height":11}},{"id":"0d3bef81-bf14-4014-bea5-fd7ff306ae54","block_type":"box","text":"Por tfolio commenced operations on October 31, 1980. The Corporation changed its name to Merrill Lynch Bond","page_number":45,"box":{"x":69,"y":415,"width":797,"height":11}},{"id":"80af8d3d-0885-48a9-b5dc-eb961366b02f","block_type":"box","text":"Fund, Inc. on January 22, 2001. The High Quality Por tfolio changed its name to Core Bond Por tfolio on","page_number":45,"box":{"x":70,"y":430,"width":731,"height":11}},{"id":"18531250-3195-43bb-ae65-abdeb82b1cd1","block_type":"box","text":"January 22, 2001. Effective October 1, 2003, Core Bond Por tfolio conver ted to a master/feeder structure. Effective","page_number":45,"box":{"x":69,"y":445,"width":830,"height":11}},{"id":"e3b2023e-94a4-477a-b6fc-6244eb865860","block_type":"box","text":"September 29, 2006, the Corporation changed its name to BlackRock Bond Fund, Inc., and High Income Por tfolio","page_number":45,"box":{"x":69,"y":460,"width":810,"height":12}},{"id":"3d2480ac-f33c-45f4-8195-f59975baa6e8","block_type":"box","text":"and Core Bond Por tfolio changed their names to BlackRock High Income Fund and BlackRock Bond Fund,","page_number":45,"box":{"x":69,"y":475,"width":749,"height":12}},{"id":"88175e1b-a63f-42ab-beb7-e215e7aa3c43","block_type":"box","text":"respectively. Effective September 24, 2007, BlackRock Bond Fund changed its name to BlackRock Total Return Fund.","page_number":45,"box":{"x":69,"y":491,"width":837,"height":11}},{"id":"4c250c3c-f84f-47ce-b532-c8ef8c600d64","block_type":"box","text":"Effective October 15, 2021, the Corporation added BlackRock Sustainable Total Return Fund as a new series.","page_number":45,"box":{"x":70,"y":506,"width":782,"height":11}},{"id":"0f2cbbf9-1805-4f37-828e-4bea020cd8f8","block_type":"box","text":"BlackRock Sustainable Total Return Fund commenced operations on October 15, 2021 and was later liquidated on or","page_number":45,"box":{"x":70,"y":521,"width":836,"height":11}},{"id":"bfb95229-d506-4481-b04a-191e252ea01c","block_type":"box","text":"about September 19, 2025. 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Information that does not apply to a Covered Fund does not form","page_number":48,"box":{"x":69,"y":596,"width":835,"height":11}},{"id":"50b10da6-d261-4616-9f05-03044b799216","block_type":"box","text":"a par t of that Covered Fund’s SAI and should not be relied on by investors in that Covered Fund. Only information that","page_number":48,"box":{"x":69,"y":611,"width":840,"height":11}},{"id":"8618ae86-8400-45fa-8d88-881fb826eab8","block_type":"box","text":"is clearly identified as applicable to a Covered Fund is considered to form a par t of that Covered Fund’s SAI.","page_number":48,"box":{"x":70,"y":626,"width":770,"height":11}},{"id":"ed9a41c7-5300-43b9-a5dc-c671e090291b","block_type":"box","text":"Asset-Backed Securities.","page_number":48,"box":{"x":101,"y":649,"width":183,"height":9}},{"id":"9d0f893a-eac6-4ce8-b163-3007fae3bada","block_type":"box","text":"Asset-backed securities are securities backed by home equity loans, installment sale","page_number":48,"box":{"x":290,"y":649,"width":607,"height":11}},{"id":"cc20f2f4-459e-4754-9198-9a06ed0a5db9","block_type":"box","text":"contracts, credit card receivables or other assets. Asset-backed securities are “pass-through” securities, meaning","page_number":48,"box":{"x":69,"y":664,"width":814,"height":11}},{"id":"59b157f0-2b98-4324-99ea-f2bbd5758c14","block_type":"box","text":"that principal and interest payments — net of expenses — made by the borrower on the underlying assets (such as","page_number":48,"box":{"x":68,"y":679,"width":825,"height":11}},{"id":"46f91ff0-9196-4b14-a469-606f00bb3e01","block_type":"box","text":"credit card receivables) are passed through to a Fund. The value of asset-backed securities, like that of traditional","page_number":48,"box":{"x":69,"y":694,"width":813,"height":11}},{"id":"42648b36-4402-4ac4-ace4-e71a7de5249e","block_type":"box","text":"fixed-income securities, typically increases when interest rates fall and decreases when interest rates rise. However,","page_number":48,"box":{"x":68,"y":709,"width":830,"height":11}},{"id":"703db428-50e1-430d-849d-a568586cbb70","block_type":"box","text":"asset-backed securities differ from traditional fixed-income securities because of their potential for prepayment. The","page_number":48,"box":{"x":69,"y":724,"width":827,"height":11}},{"id":"40da3c16-d8b1-477d-b436-01d429cc3916","block_type":"box","text":"price paid by a Fund for its asset-backed securities, the yield the Fund expects to receive from such securities and","page_number":48,"box":{"x":70,"y":739,"width":813,"height":12}},{"id":"ba82edf5-7270-4384-9a0c-bf5665062945","block_type":"box","text":"the average life of the securities are based on a number of factors, including the anticipated rate of prepayment of","page_number":48,"box":{"x":68,"y":755,"width":818,"height":11}},{"id":"e76ef5c0-c658-4090-9d48-53ecb7126498","block_type":"box","text":"the underlying assets. In a period of declining interest rates, borrowers may prepay the underlying assets more","page_number":48,"box":{"x":68,"y":770,"width":792,"height":11}},{"id":"6d4014a8-1477-4488-b4e5-0d57afa36025","block_type":"box","text":"quickly than anticipated, thereby reducing the yield to maturity and the average life of the asset-backed securities.","page_number":48,"box":{"x":69,"y":785,"width":811,"height":11}},{"id":"2da7aa41-b1ba-421c-a386-37a782093160","block_type":"box","text":"Moreover, when a Fund reinvests the proceeds of a prepayment in these circumstances, it will likely receive a rate of","page_number":48,"box":{"x":70,"y":800,"width":832,"height":11}},{"id":"cf6944f8-c648-4daa-bf97-b757fee5796d","block_type":"box","text":"interest that is lower than the rate on the security that was prepaid. To the extent that a Fund purchases asset","page_number":48,"box":{"x":70,"y":815,"width":792,"height":11}},{"id":"e225a35c-bd95-40a1-ab32-944b236c4016","block_type":"box","text":"backed securities at a premium, prepayments may result in a loss to the extent of the premium paid. If a Fund buys","page_number":48,"box":{"x":69,"y":830,"width":825,"height":11}},{"id":"66fa12a7-a4bb-4c93-a4cd-8e39c4833280","block_type":"box","text":"such securities at a discount, both scheduled payments and unscheduled prepayments will increase current and total","page_number":48,"box":{"x":69,"y":846,"width":838,"height":10}},{"id":"cecefbcc-9193-422e-b46e-2cea88064ae2","block_type":"box","text":"returns and unscheduled prepayments will also accelerate the recognition of income which, when distributed to","page_number":48,"box":{"x":69,"y":860,"width":793,"height":12}},{"id":"d51cb794-5f75-4a89-8727-94a61f0f8f94","block_type":"box","text":"shareholders, will be taxable as ordinary income. In a period of rising interest rates, prepayments of the underlying","page_number":48,"box":{"x":69,"y":875,"width":819,"height":12}},{"id":"312eec90-1228-4d23-a83a-d9f9ce157492","block_type":"box","text":"assets may occur at a slower than expected rate, creating maturity extension risk. This par ticular risk may effectively","page_number":48,"box":{"x":69,"y":891,"width":834,"height":11}},{"id":"afdb287e-3f90-431c-9be4-4f0f1d5a9101","block_type":"box","text":"change a security that was considered shor t- or intermediate-term at the time of purchase into a longer term security.","page_number":48,"box":{"x":69,"y":906,"width":837,"height":11}},{"id":"8efd459f-4425-4b5c-8341-a012452815ed","block_type":"box","text":"II-1","page_number":48,"box":{"x":478,"y":943,"width":23,"height":9}},{"id":"3d8256c4-f165-42db-a502-abc7499f1166","block_type":"box","text":"NM1026U-6033063-48/246","page_number":48,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"00612669-4907-4310-931b-1bd827ee2f7f","block_type":"box","text":"Since the value of longer-term securities generally fluctuates more widely in response to changes in interest rates","page_number":49,"box":{"x":69,"y":45,"width":810,"height":11}},{"id":"67f92691-55b1-4011-8a7d-d8d925e4ce8e","block_type":"box","text":"than does the value of shor ter-term securities, maturity extension risk could increase the volatility of the Fund. When","page_number":49,"box":{"x":68,"y":60,"width":833,"height":11}},{"id":"0942e7cd-4f56-4dd5-9a53-c56f8f5bcf0e","block_type":"box","text":"interest rates decline, the value of an asset-backed security with prepayment features may not increase as much as","page_number":49,"box":{"x":70,"y":75,"width":827,"height":11}},{"id":"6273af3b-8898-468c-bc04-369e34067f1e","block_type":"box","text":"that of other fixed-income securities, and, as noted above, changes in market rates of interest may accelerate or","page_number":49,"box":{"x":68,"y":90,"width":805,"height":11}},{"id":"b7e949b0-c564-4ff5-a3d6-de5515fabb28","block_type":"box","text":"retard prepayments and thus affect maturities.","page_number":49,"box":{"x":69,"y":105,"width":333,"height":11}},{"id":"ef011add-f53c-45c9-bff3-c4aee9d8587e","block_type":"box","text":"Asset-Based Securities.","page_number":49,"box":{"x":101,"y":128,"width":173,"height":9}},{"id":"a2089d53-9b04-43dd-839d-51b14c4357b2","block_type":"box","text":"Cer tain Funds may invest in debt, preferred or conver tible securities, the principal","page_number":49,"box":{"x":281,"y":128,"width":582,"height":11}},{"id":"2fb14544-ad65-4d23-87c7-63f33ef38942","block_type":"box","text":"amount, redemption terms or conversion terms of which are related to the market price of some natural resource","page_number":49,"box":{"x":69,"y":143,"width":808,"height":11}},{"id":"3deae115-57c7-48e8-bbff-78a6b829bbe2","block_type":"box","text":"asset such as gold bullion. These securities are referred to as “asset-based securities.” A Fund will purchase only","page_number":49,"box":{"x":69,"y":158,"width":815,"height":11}},{"id":"443630b6-d33c-44cb-994a-04bb99b193c8","block_type":"box","text":"asset-based securities that are rated, or are issued by issuers that have outstanding debt obligations rated,","page_number":49,"box":{"x":69,"y":173,"width":769,"height":11}},{"id":"c8f290f5-e912-4d69-8147-f39127384536","block_type":"box","text":"investment grade (for example, AAA, AA, A or BBB by S&P Global Ratings (“S&P”) or Fitch Ratings (“Fitch”), or Baa by","page_number":49,"box":{"x":70,"y":188,"width":833,"height":12}},{"id":"7309bbc2-97ef-4c38-9bcd-43343ac3438e","block_type":"box","text":"Moody’s Investors Service, Inc. (“Moody’s”) or commercial paper rated A-1 by S&P or Prime-1 by Moody’s) or by","page_number":49,"box":{"x":70,"y":203,"width":795,"height":12}},{"id":"ce2086c2-4a1b-4389-ae01-812ce08dbf2e","block_type":"box","text":"issuers that the Manager has determined to be of similar creditwor thiness. Obligations ranked in the four th highest","page_number":49,"box":{"x":70,"y":218,"width":824,"height":12}},{"id":"00f2e55d-97a0-486a-ac84-7e101704c6ba","block_type":"box","text":"rating category, while considered “investment grade,” may have cer tain speculative characteristics and may be more","page_number":49,"box":{"x":69,"y":234,"width":832,"height":11}},{"id":"553f5201-3379-4f77-8f0b-72bdeeef5a49","block_type":"box","text":"likely to be downgraded than securities rated in the three highest rating categories. If an asset-based security is","page_number":49,"box":{"x":70,"y":249,"width":797,"height":11}},{"id":"4c7c5d62-0783-455c-b6c3-2a61154e69f9","block_type":"box","text":"backed by a bank letter of credit or other similar facility, the Manager may take such backing into account in","page_number":49,"box":{"x":69,"y":264,"width":768,"height":11}},{"id":"6ea47ec4-dafe-4181-bacf-7e5e2b0b2fda","block_type":"box","text":"determining the creditwor thiness of the issuer. While the market prices for an asset-based security and the related","page_number":49,"box":{"x":69,"y":279,"width":819,"height":11}},{"id":"334ad016-56b6-4b79-a3a3-306c23641c9d","block_type":"box","text":"natural resource asset generally are expected to move in the same direction, there may not be per fect correlation in","page_number":49,"box":{"x":69,"y":294,"width":829,"height":11}},{"id":"52163231-cdf2-4dc1-906c-cd337afd114a","block_type":"box","text":"the two price movements. Asset-based securities may not be secured by a security interest in or claim on the","page_number":49,"box":{"x":68,"y":309,"width":780,"height":11}},{"id":"f5791978-301f-4314-9d49-ffd3188ecd43","block_type":"box","text":"underlying natural resource asset. The asset-based securities in which a Fund may invest may bear interest or pay","page_number":49,"box":{"x":69,"y":325,"width":815,"height":11}},{"id":"a712e784-95b2-4b48-8183-a16b603cd336","block_type":"box","text":"preferred dividends at below market (or even relatively nominal) rates. Cer tain asset-based securities may be payable","page_number":49,"box":{"x":70,"y":339,"width":837,"height":12}},{"id":"6079ca94-30cc-4bf2-9f10-09bd8cab8560","block_type":"box","text":"at maturity in cash at the stated principal amount or, at the option of the holder, directly in a stated amount of the","page_number":49,"box":{"x":69,"y":355,"width":812,"height":11}},{"id":"d3f0214d-47e1-43b1-a66c-d6a09b0bd125","block_type":"box","text":"asset to which it is related. In such instance, because no Fund presently intends to invest directly in natural resource","page_number":49,"box":{"x":69,"y":370,"width":836,"height":11}},{"id":"fc61156e-bd26-4a37-ace1-34d3c8708f45","block_type":"box","text":"assets, a Fund would sell the asset-based security in the secondary market, to the extent one exists, prior to","page_number":49,"box":{"x":69,"y":385,"width":778,"height":11}},{"id":"212e36f4-ddf4-4bfd-a289-65c677de9a05","block_type":"box","text":"maturity if the value of the stated amount of the asset exceeds the stated principal amount and thereby realize the","page_number":49,"box":{"x":69,"y":400,"width":819,"height":11}},{"id":"722cee53-4c8c-4f8a-bc5d-515c0e4fcbdc","block_type":"box","text":"appreciation in the underlying asset.","page_number":49,"box":{"x":69,"y":415,"width":258,"height":11}},{"id":"66935bf7-322c-40db-85d9-a492e83a26ea","block_type":"box","text":"Precious Metal-Related Securities.","page_number":49,"box":{"x":102,"y":438,"width":243,"height":9}},{"id":"a199b960-2e84-43f1-8443-96e112347e5f","block_type":"box","text":"A Fund may invest in the equity and other securities of companies that","page_number":49,"box":{"x":351,"y":438,"width":503,"height":11}},{"id":"60293627-45ce-4473-b0f3-1a0a356140b1","block_type":"box","text":"explore for, extract, process or deal in precious metals (","page_number":49,"box":{"x":69,"y":453,"width":398,"height":11}},{"id":"21116f1c-d854-4fcc-ae1f-f95f9c622c1c","block_type":"box","text":"e.g.","page_number":49,"box":{"x":469,"y":454,"width":25,"height":10}},{"id":"111bf1d9-ad67-4a05-a41e-e9db5a2c701e","block_type":"box","text":", gold, silver and platinum), and in asset-based securities","page_number":49,"box":{"x":497,"y":453,"width":407,"height":11}},{"id":"3775c475-d9d6-42a4-b9f2-09c6c7ab2826","block_type":"box","text":"indexed to the value of such metals. Such securities may be purchased when they are believed to be attractively","page_number":49,"box":{"x":70,"y":468,"width":801,"height":11}},{"id":"a03170b5-e33d-4083-8963-213d5d539220","block_type":"box","text":"priced in relation to the value of a company’s precious metal-related assets or when the values of precious metals","page_number":49,"box":{"x":70,"y":483,"width":815,"height":11}},{"id":"f7049ac5-ab92-4afa-af23-bcae8cc2a6e0","block_type":"box","text":"are expected to benefit from inflationary pressure or other economic, political or financial uncer tainty or instability.","page_number":49,"box":{"x":69,"y":498,"width":815,"height":11}},{"id":"956664ec-df00-4376-9cf8-94beb7858332","block_type":"box","text":"Based on historical experience, during periods of economic or financial instability the securities of companies","page_number":49,"box":{"x":70,"y":513,"width":779,"height":12}},{"id":"9eb96f54-c2cc-416a-b827-f85b7766af01","block_type":"box","text":"involved in precious metals may be subject to extreme price fluctuations, reflecting the high volatility of precious","page_number":49,"box":{"x":70,"y":528,"width":799,"height":12}},{"id":"18e47e9e-c70c-4026-b67d-2bbcb8ebf142","block_type":"box","text":"metal prices during such periods. In addition, the instability of precious metal prices may result in volatile earnings of","page_number":49,"box":{"x":69,"y":543,"width":838,"height":12}},{"id":"fc88de09-74b6-4e57-98b1-54a242ee88ce","block_type":"box","text":"precious metal-related companies, which may, in turn, adversely affect the financial condition of such companies. The","page_number":49,"box":{"x":70,"y":559,"width":838,"height":11}},{"id":"595f8b00-33f3-4132-8a90-d6d93dbc9889","block_type":"box","text":"major producers of gold include the Republic of South Africa, Russia, Canada, the United States, Brazil and Australia.","page_number":49,"box":{"x":69,"y":574,"width":835,"height":11}},{"id":"ca8dd403-30e8-415c-a59b-239cc6fed98c","block_type":"box","text":"Sales of gold by Russia are largely unpredictable and often relate to political and economic considerations rather","page_number":49,"box":{"x":69,"y":589,"width":806,"height":11}},{"id":"ad790407-59ae-4307-bfc6-7c788eb95754","block_type":"box","text":"than to market forces. Economic, financial, social and political factors within South Africa may significantly affect","page_number":49,"box":{"x":68,"y":604,"width":805,"height":11}},{"id":"ebda75ed-b241-455c-8178-c1a736074867","block_type":"box","text":"South African gold production.","page_number":49,"box":{"x":69,"y":619,"width":213,"height":11}},{"id":"32eb21ec-8fbf-46da-aa93-1ffa62e4ed5c","block_type":"box","text":"Borrowing and Leverage.","page_number":49,"box":{"x":102,"y":642,"width":179,"height":11}},{"id":"2f04a846-8f47-4e05-87dd-0428390b0866","block_type":"box","text":"Each Fund may borrow as a temporary measure for extraordinary or emergency","page_number":49,"box":{"x":288,"y":642,"width":563,"height":11}},{"id":"54d8d0e3-7b4a-4787-a81c-f491a1421378","block_type":"box","text":"purposes, including to meet redemptions or to settle securities transactions. Cer tain Funds will not purchase","page_number":49,"box":{"x":70,"y":657,"width":777,"height":11}},{"id":"2e3d1ce4-b276-4dff-86bd-54b7f656054f","block_type":"box","text":"securities at any time when borrowings exceed 5% of their total assets, except (a) to honor prior commitments or","page_number":49,"box":{"x":69,"y":672,"width":806,"height":11}},{"id":"e97b6897-1df7-48f1-b52c-01d28e1ff4f8","block_type":"box","text":"(b) to exercise subscription rights when outstanding borrowings have been obtained exclusively for settlements of","page_number":49,"box":{"x":69,"y":687,"width":810,"height":11}},{"id":"9d1b7486-5a9e-4ecd-a344-9ac490486927","block_type":"box","text":"other securities transactions.","page_number":49,"box":{"x":69,"y":703,"width":207,"height":8}},{"id":"38fc9e08-c20a-4b9c-805e-441301731f09","block_type":"box","text":"Cer tain Funds may also borrow in order to make investments, to the extent disclosed in such Fund’s Prospectus.","page_number":49,"box":{"x":102,"y":725,"width":806,"height":11}},{"id":"6326dc54-2806-4178-8480-8360cb18d3f3","block_type":"box","text":"The purchase of securities while borrowings are outstanding will have the effect of leveraging the Fund. Such","page_number":49,"box":{"x":68,"y":740,"width":776,"height":11}},{"id":"be615319-2d43-41e9-a703-fac0b52ac5b9","block_type":"box","text":"leveraging increases the Fund’s exposure to capital risk, and borrowed funds are subject to interest costs that will","page_number":49,"box":{"x":70,"y":755,"width":813,"height":11}},{"id":"9d8cd841-76ff-403a-89fa-709cd462f3df","block_type":"box","text":"reduce net income. The use of leverage by a Fund creates an oppor tunity for greater total return, but, at the same","page_number":49,"box":{"x":69,"y":770,"width":813,"height":12}},{"id":"521ccb19-f8c0-4c67-b00d-c4d135fcfaa2","block_type":"box","text":"time, creates special risks. For example, leveraging may exaggerate changes in the net asset value (“NAV”) of Fund","page_number":49,"box":{"x":68,"y":785,"width":823,"height":12}},{"id":"d88c2fb6-c394-4672-ae27-6409527d9477","block_type":"box","text":"shares and in the yield on the Fund’s por tfolio. Although the principal of such borrowings will be fixed, the Fund’s","page_number":49,"box":{"x":69,"y":801,"width":806,"height":11}},{"id":"71762f68-70f4-4eeb-9009-9c9b92af923a","block_type":"box","text":"assets may change in value during the time the borrowings are outstanding. Borrowings will create interest expenses","page_number":49,"box":{"x":69,"y":816,"width":835,"height":11}},{"id":"0f430bf4-237e-4ea4-9991-2d59c3bb59cb","block_type":"box","text":"for the Fund that can exceed the income from the assets purchased with the borrowings. To the extent the income or","page_number":49,"box":{"x":68,"y":831,"width":835,"height":11}},{"id":"83b456bf-5557-4132-a2f0-4f2ec50afbae","block_type":"box","text":"capital appreciation derived from securities purchased with borrowed funds exceeds the interest the Fund will have to","page_number":49,"box":{"x":69,"y":846,"width":838,"height":11}},{"id":"4988bbf8-51e8-4b31-8ca2-43b3d1f0beea","block_type":"box","text":"pay on the borrowings, the Fund’s return will be greater than if leverage had not been used. Conversely, if the income","page_number":49,"box":{"x":70,"y":861,"width":835,"height":11}},{"id":"9d5d7689-8323-4e24-b20f-89cb08373a76","block_type":"box","text":"or capital appreciation from the securities purchased with such borrowed funds is not sufficient to cover the cost of","page_number":49,"box":{"x":69,"y":876,"width":825,"height":11}},{"id":"b38d83b4-9264-4e76-83f5-2940995ffbe3","block_type":"box","text":"borrowing, the return to the Fund will be less than if leverage had not been used and, therefore, the amount available","page_number":49,"box":{"x":69,"y":891,"width":837,"height":12}},{"id":"029aea40-7e04-4aa4-a6dd-4e5d977db604","block_type":"box","text":"for distribution to shareholders as dividends will be reduced. In the latter case, the Manager in its best judgment","page_number":49,"box":{"x":68,"y":906,"width":805,"height":12}},{"id":"95f68382-8ba3-46fe-b466-6cfdcc14c45a","block_type":"box","text":"II-2","page_number":49,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"8310a2ea-7606-4ae8-94c3-d9ca777216d0","block_type":"box","text":"NM1026U-6033063-49/246","page_number":49,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"3a2fe1bf-cc8c-4fb0-8ee8-6d3172934661","block_type":"box","text":"never theless may determine to maintain the Fund’s leveraged position if it expects that the benefits to the Fund’s","page_number":50,"box":{"x":69,"y":45,"width":813,"height":11}},{"id":"7a71830d-2af3-4b63-b5d2-f1da62dbc20a","block_type":"box","text":"shareholders of maintaining the leveraged position will outweigh the current reduced return.","page_number":50,"box":{"x":69,"y":60,"width":653,"height":11}},{"id":"419dfb61-c629-4b2f-9595-875df2ec87cc","block_type":"box","text":"Cer tain types of borrowings by a Fund may result in the Fund being subject to covenants in credit agreements","page_number":50,"box":{"x":102,"y":82,"width":780,"height":12}},{"id":"287bbb7d-538a-4c4a-a1d7-fab30e8fcc17","block_type":"box","text":"relating to asset coverage, por tfolio composition requirements and other matters. It is not anticipated that","page_number":50,"box":{"x":69,"y":98,"width":759,"height":11}},{"id":"890227b0-6bf4-4072-be03-7007a3387e5c","block_type":"box","text":"observance of such covenants would impede the Manager from managing a Fund’s por tfolio in accordance with the","page_number":50,"box":{"x":69,"y":113,"width":822,"height":11}},{"id":"7dcd7c9d-8ac2-4510-a19e-6a5a72e6b4da","block_type":"box","text":"Fund’s investment objectives and policies. However, a breach of any such covenants not cured within the specified","page_number":50,"box":{"x":70,"y":128,"width":816,"height":11}},{"id":"e71eaaa4-8d25-4305-8175-43ab8b0e0a72","block_type":"box","text":"cure period may result in acceleration of outstanding indebtedness and require the Fund to dispose of por tfolio","page_number":50,"box":{"x":69,"y":143,"width":792,"height":11}},{"id":"b17ee4de-0ffa-4467-afb1-e41ed8b80282","block_type":"box","text":"investments at a time when it may be disadvantageous to do so.","page_number":50,"box":{"x":70,"y":158,"width":459,"height":11}},{"id":"2bf80965-a3ce-4790-89d6-dbbc4c1be582","block_type":"box","text":"Each Fund may at times borrow from affiliates of the Manager, provided that the terms of such borrowings are","page_number":50,"box":{"x":102,"y":181,"width":786,"height":11}},{"id":"98a80610-7103-4f11-b715-52a9e7ebcdcd","block_type":"box","text":"no less favorable than those available from comparable sources of funds in the marketplace.","page_number":50,"box":{"x":69,"y":196,"width":663,"height":11}},{"id":"53739a85-b33f-4f30-ac57-019286f53e56","block_type":"box","text":"Cash Management.","page_number":50,"box":{"x":102,"y":219,"width":140,"height":11}},{"id":"978a3425-6646-4d08-99f9-efe0d29f28bc","block_type":"box","text":"Generally, the Manager will employ futures and options on futures to provide liquidity","page_number":50,"box":{"x":249,"y":218,"width":603,"height":12}},{"id":"25342662-0aed-41b5-a0c0-ac2dafbb44c4","block_type":"box","text":"necessary to meet anticipated redemptions or for day-to-day operating purposes. However, if considered appropriate","page_number":50,"box":{"x":69,"y":234,"width":828,"height":11}},{"id":"631b2d0a-cb3a-40d8-aa3a-a6bbb2051df9","block_type":"box","text":"in the opinion of the Manager, a por tion of a Fund’s assets may be invested in cer tain types of instruments with","page_number":50,"box":{"x":70,"y":249,"width":799,"height":11}},{"id":"f83e41a3-cd6d-43c8-a541-db413e5a8b5b","block_type":"box","text":"remaining maturities of 397 days or less for liquidity purposes. Such instruments would consist of: (i) obligations of","page_number":50,"box":{"x":69,"y":264,"width":826,"height":11}},{"id":"6ca2606f-e5d1-4fc4-a08e-219e4f81355c","block_type":"box","text":"the U.S. Government, its agencies, instrumentalities, authorities or political subdivisions (“U.S. Government","page_number":50,"box":{"x":68,"y":279,"width":772,"height":11}},{"id":"ca3c6c53-9c8e-43f7-a1cb-3bc3fc341613","block_type":"box","text":"Securities”); (ii) other fixed-income securities rated Aa or higher by Moody’s or AA or higher by S&P or, if unrated, of","page_number":50,"box":{"x":69,"y":294,"width":823,"height":11}},{"id":"c75eb681-8c3e-4609-9ea9-05e2ecec92ef","block_type":"box","text":"comparable quality in the opinion of the Manager; (iii) commercial paper; (iv) bank obligations, including negotiable","page_number":50,"box":{"x":69,"y":309,"width":816,"height":11}},{"id":"d318d9bc-b809-4ab9-bb13-d98efc89fca8","block_type":"box","text":"cer tificates of deposit, time deposits and bankers’ acceptances; and (v) repurchase agreements. At the time the","page_number":50,"box":{"x":69,"y":324,"width":804,"height":12}},{"id":"e013eed1-cf6e-45c2-be98-75ce53eed0e0","block_type":"box","text":"Fund invests in commercial paper, bank obligations or repurchase agreements, the issuer or the issuer’s parent must","page_number":50,"box":{"x":70,"y":340,"width":839,"height":11}},{"id":"99fc2a00-c259-47a9-9ee9-f5a352aa307c","block_type":"box","text":"have outstanding debt rated Aa or higher by Moody’s or AA or higher by S&P or outstanding commercial paper, bank","page_number":50,"box":{"x":69,"y":355,"width":824,"height":11}},{"id":"4ebafb20-cda2-4e89-87ee-edb8fab42577","block_type":"box","text":"obligations or other shor t-term obligations rated Prime-1 by Moody’s or A-1 by S&P; or, if no such ratings are","page_number":50,"box":{"x":69,"y":370,"width":771,"height":11}},{"id":"487714ef-8c98-4fc7-a7f1-ae340d65d741","block_type":"box","text":"available, the instrument must be of comparable quality in the opinion of the Manager. For more information on","page_number":50,"box":{"x":69,"y":385,"width":793,"height":11}},{"id":"eaa228c2-0849-4866-bad0-a43f854e09e8","block_type":"box","text":"money market instruments, see “Money Market Securities” below.","page_number":50,"box":{"x":69,"y":400,"width":472,"height":11}},{"id":"c89c61c8-2be4-4a8b-8087-1e771e741e6f","block_type":"box","text":"Collateralized Debt Obligations.","page_number":50,"box":{"x":102,"y":423,"width":229,"height":11}},{"id":"8f8d07e1-3749-4d57-a0c9-ff746d1c0fc1","block_type":"box","text":"Cer tain Funds may invest in collateralized debt obligations (“CDOs”), which","page_number":50,"box":{"x":337,"y":423,"width":534,"height":11}},{"id":"6e67acf0-bfed-4f0a-81d2-0e27391b3667","block_type":"box","text":"include collateralized bond obligations (“CBOs”), collateralized loan obligations (“CLOs”) and other similarly","page_number":50,"box":{"x":70,"y":438,"width":764,"height":11}},{"id":"8ba97103-6b9b-4eff-bc1d-c168088c8eb6","block_type":"box","text":"structured securities. CDOs are types of asset-backed securities. A CBO is ordinarily issued by a trust or other","page_number":50,"box":{"x":69,"y":453,"width":787,"height":11}},{"id":"e0475ff6-b0ec-4b66-954f-f22c5f0c6e8f","block_type":"box","text":"special purpose entity (“SPE”) and is typically backed by a diversified pool of fixed-income securities (which may","page_number":50,"box":{"x":69,"y":468,"width":797,"height":11}},{"id":"47f18ddb-ef2c-44d2-866a-748b0c26bc1a","block_type":"box","text":"include high risk, below investment grade securities) held by such issuer. A CLO is ordinarily issued by a trust or","page_number":50,"box":{"x":70,"y":483,"width":798,"height":11}},{"id":"6a83a67a-2a75-426c-80a2-3b0480ba006c","block_type":"box","text":"other SPE and is typically collateralized by a pool of loans, which may include, among others, domestic and non-U.S.","page_number":50,"box":{"x":69,"y":498,"width":827,"height":11}},{"id":"ffacd076-f5ec-4305-9a20-5d9a54d34046","block_type":"box","text":"senior secured loans, senior unsecured loans, and subordinate corporate loans, including loans that may be rated","page_number":50,"box":{"x":69,"y":514,"width":814,"height":11}},{"id":"cb3b318b-4ceb-4006-a8e6-df8d6ddb7f59","block_type":"box","text":"below investment grade or equivalent unrated loans, held by such issuer. Investments in a CLO organized outside of","page_number":50,"box":{"x":69,"y":528,"width":828,"height":12}},{"id":"577583f3-6cb2-4fe1-bd21-6cd906c81e50","block_type":"box","text":"the United States may not be deemed to be foreign securities if the CLO is collateralized by a pool of loans, a","page_number":50,"box":{"x":68,"y":543,"width":782,"height":12}},{"id":"0a46c0ee-91fa-41b4-887b-a4a266321290","block_type":"box","text":"substantial por tion of which are U.S. loans. Although cer tain CDOs may benefit from credit enhancement in the form","page_number":50,"box":{"x":69,"y":559,"width":830,"height":11}},{"id":"4ac1a9ac-351e-4e3c-be2e-d48a5a23f92b","block_type":"box","text":"of a senior-subordinate structure, over-collateralization or bond insurance, such enhancement may not always be","page_number":50,"box":{"x":69,"y":574,"width":803,"height":11}},{"id":"c20d784a-d526-45c9-be87-08e0dde966fe","block_type":"box","text":"present, and may fail to protect a Fund against the risk of loss on default of the collateral. Cer tain CDO issuers may","page_number":50,"box":{"x":70,"y":589,"width":827,"height":11}},{"id":"392eeebb-bf12-4c96-9e63-8e41d2413d9d","block_type":"box","text":"use derivatives contracts to create “synthetic” exposure to assets rather than holding such assets directly, which","page_number":50,"box":{"x":69,"y":604,"width":807,"height":11}},{"id":"327211f3-38a7-4f55-b2e4-0f7a066e741e","block_type":"box","text":"entails the risks of derivative instruments described elsewhere in this SAI. CDOs may charge management fees and","page_number":50,"box":{"x":69,"y":619,"width":826,"height":11}},{"id":"e5f0fd84-bd60-4219-9d4e-d13e4d82c8f3","block_type":"box","text":"administrative expenses, which are in addition to those of a Fund.","page_number":50,"box":{"x":69,"y":634,"width":469,"height":11}},{"id":"35d0365c-66b2-416d-adab-b9f1c5a226f6","block_type":"box","text":"For both CBOs and CLOs, the cash flows from the SPE are split into two or more por tions, called tranches,","page_number":50,"box":{"x":102,"y":657,"width":758,"height":11}},{"id":"26b9de34-b195-411a-bd42-30829e62aaff","block_type":"box","text":"varying in risk and yield. The riskiest por tion is the “equity” tranche, which bears the first loss from defaults from the","page_number":50,"box":{"x":68,"y":672,"width":836,"height":11}},{"id":"afa2c711-16ca-4eed-860e-126b09830e60","block_type":"box","text":"bonds or loans in the SPE and serves to protect the other, more senior tranches from default (though such protection","page_number":50,"box":{"x":69,"y":687,"width":838,"height":11}},{"id":"af952ef2-9396-45b4-89b4-0a9498440b46","block_type":"box","text":"is not complete). Since it is par tially protected from defaults, a senior tranche from a CBO or CLO typically has higher","page_number":50,"box":{"x":70,"y":702,"width":835,"height":12}},{"id":"236779aa-565c-4207-9fe7-f98201233ef1","block_type":"box","text":"ratings and lower yields than its underlying securities, and may be rated investment grade. Despite the protection","page_number":50,"box":{"x":69,"y":718,"width":808,"height":11}},{"id":"75dd516c-310a-4a46-b376-f8b6a8efbd67","block_type":"box","text":"from the equity tranche, CBO or CLO tranches can experience substantial losses due to actual defaults, downgrades","page_number":50,"box":{"x":68,"y":732,"width":830,"height":12}},{"id":"2744bbc6-bd42-4982-9cab-6fd98ff6e24e","block_type":"box","text":"of the underlying collateral by rating agencies, forced liquidation of the collateral pool due to a failure of coverage","page_number":50,"box":{"x":69,"y":748,"width":806,"height":11}},{"id":"6e833157-07fd-422f-9508-07a9ddd0334e","block_type":"box","text":"tests, increased sensitivity to defaults due to collateral default and disappearance of protecting tranches, market","page_number":50,"box":{"x":68,"y":763,"width":809,"height":11}},{"id":"685dfa59-70eb-435f-87dc-0e187e915e6b","block_type":"box","text":"anticipation of defaults as well as investor aversion to CBO or CLO securities as a class. Interest on cer tain tranches","page_number":50,"box":{"x":69,"y":778,"width":835,"height":11}},{"id":"20bc8196-c83a-4a0e-9e13-2745f437c901","block_type":"box","text":"of a CDO may be paid in kind or deferred and capitalized (paid in the form of obligations of the same type rather than","page_number":50,"box":{"x":69,"y":793,"width":835,"height":11}},{"id":"ed1f69da-14cb-4381-95f5-1be39ad852a7","block_type":"box","text":"cash), which involves continued exposure to default risk with respect to such payments.","page_number":50,"box":{"x":69,"y":808,"width":625,"height":11}},{"id":"c56b91fb-3182-484d-9469-5fba85d8d52a","block_type":"box","text":"The risks of an investment in a CDO depend largely on the type of the collateral securities and the class of the","page_number":50,"box":{"x":101,"y":831,"width":789,"height":11}},{"id":"000c3bfa-6795-401c-a286-26acfe6283ec","block_type":"box","text":"CDO in which a Fund invests. Normally, CBOs, CLOs and other CDOs are privately offered and sold, and thus are not","page_number":50,"box":{"x":69,"y":846,"width":830,"height":11}},{"id":"4e7d9559-53be-4b4e-a0b6-2b7cd968b21b","block_type":"box","text":"registered under the securities laws. However, an active dealer market may exist for CDOs, allowing a CDO to qualify","page_number":50,"box":{"x":69,"y":861,"width":830,"height":11}},{"id":"05dca66d-5e89-447b-ab73-f6d476e7b8da","block_type":"box","text":"for Rule 144A transactions. In addition to the normal risks associated with fixed-income securities and asset-backed","page_number":50,"box":{"x":68,"y":876,"width":831,"height":9}},{"id":"121687f3-4875-49c0-9a44-74a629177d35","block_type":"box","text":"securities generally discussed elsewhere in this SAI, CDOs carry additional risks including, but not limited to: (i) the","page_number":50,"box":{"x":69,"y":891,"width":824,"height":12}},{"id":"adc8aba8-f0fb-4632-a632-772a8fd2f0e6","block_type":"box","text":"possibility that distributions from collateral securities will not be adequate to make interest or other payments; (ii) the","page_number":50,"box":{"x":70,"y":906,"width":838,"height":12}},{"id":"f8370ba0-ebb9-453c-b86e-928b869a004c","block_type":"box","text":"II-3","page_number":50,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"a23ee0e1-573b-4088-819b-bf7b129fd032","block_type":"box","text":"NM1026U-6033063-50/246","page_number":50,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"7732e2b2-026d-4c1d-b4bd-3f975661eaef","block_type":"box","text":"risk that the collateral may default or decline in value or be downgraded, if rated by a nationally recognized statistical","page_number":51,"box":{"x":69,"y":45,"width":832,"height":11}},{"id":"77ba244c-ef5d-4ddd-814d-79c4e093715a","block_type":"box","text":"rating organization (“NRSRO”); (iii) a Fund may invest in tranches of CDOs that are subordinate to other tranches;","page_number":51,"box":{"x":69,"y":60,"width":807,"height":11}},{"id":"a9eb442b-3d8f-4231-9ba5-a52675e2f2cc","block_type":"box","text":"(iv) the structure and complexity of the transaction and the legal documents could lead to disputes among investors","page_number":51,"box":{"x":69,"y":75,"width":826,"height":11}},{"id":"4b074b49-ca09-47b1-95ee-559832f445eb","block_type":"box","text":"regarding the characterization of proceeds; (v) the investment return achieved by the Fund could be significantly","page_number":51,"box":{"x":69,"y":90,"width":795,"height":11}},{"id":"1c46186f-e19e-436f-b803-9757c1b27f7c","block_type":"box","text":"different than those predicted by financial models; (vi) the lack of a readily available secondary market for CDOs;","page_number":51,"box":{"x":69,"y":105,"width":804,"height":11}},{"id":"e7749eb3-0764-458e-9fa2-03b63578f730","block_type":"box","text":"(vii) the risk of forced “fire sale” liquidation due to technical defaults such as coverage test failures; and (viii) the","page_number":51,"box":{"x":69,"y":120,"width":805,"height":12}},{"id":"23217efe-f5dd-4292-92cc-b43ac5ba5f83","block_type":"box","text":"CDO’s manager may per form poorly.","page_number":51,"box":{"x":69,"y":135,"width":257,"height":12}},{"id":"515dee25-fd7d-4c2c-80bb-ba5b9ad962f2","block_type":"box","text":"Commercial Paper.","page_number":51,"box":{"x":102,"y":158,"width":136,"height":11}},{"id":"07a7c013-8539-4141-81da-a7ab0c01f09d","block_type":"box","text":"Cer tain Funds may purchase commercial paper. Commercial paper purchasable by each","page_number":51,"box":{"x":244,"y":158,"width":626,"height":11}},{"id":"79f94ffe-1d9b-4ffb-bd38-bc8f4099c125","block_type":"box","text":"Fund includes “Section 4(a)(2) paper,” a term that includes debt obligations issued in reliance on the “private","page_number":51,"box":{"x":70,"y":173,"width":781,"height":11}},{"id":"a163b0bd-af7d-4315-8b1f-00e10239eab2","block_type":"box","text":"placement” exemption from registration afforded by Section 4(a)(2) of the Securities Act. Section 4(a)(2) paper is","page_number":51,"box":{"x":70,"y":188,"width":806,"height":12}},{"id":"5841ff64-c5ce-4fdc-ba20-338f4bd5a4d9","block_type":"box","text":"restricted as to disposition under the Federal securities laws, and is frequently sold (and resold) to institutional","page_number":51,"box":{"x":69,"y":203,"width":792,"height":12}},{"id":"d69c78d4-f12e-4e01-9477-cc4711e7dd3c","block_type":"box","text":"investors such as the Fund through or with the assistance of investment dealers who make a market in the Section","page_number":51,"box":{"x":70,"y":218,"width":820,"height":12}},{"id":"d79a124a-118e-4b53-bd2c-40086249cd22","block_type":"box","text":"4(a)(2) paper, thereby providing liquidity. Cer tain transactions in Section 4(a)(2) paper may qualify for the registration","page_number":51,"box":{"x":69,"y":234,"width":831,"height":11}},{"id":"3e80a6e4-b8b6-4d1e-bbce-29f08e27b496","block_type":"box","text":"exemption provided in Rule 144A under the Securities Act. Most Funds can purchase commercial paper rated (at the","page_number":51,"box":{"x":69,"y":249,"width":831,"height":11}},{"id":"3ebec35f-0799-4949-aba7-f2b6eb63ed29","block_type":"box","text":"time of purchase) “A-1” by S&P or “Prime-1” by Moody’s or when deemed advisable by a Fund’s Manager or sub","page_number":51,"box":{"x":68,"y":264,"width":805,"height":11}},{"id":"469ecb33-ff56-47ee-8caf-0101107f55f6","block_type":"box","text":"adviser, “high quality” issues rated “A-2”, “Prime-2” or “F-2” by S&P, Moody’s or Fitch, respectively.","page_number":51,"box":{"x":69,"y":279,"width":707,"height":11}},{"id":"5da99733-e2f4-4022-a0a3-47912791a2a4","block_type":"box","text":"Commercial paper is generally considered to be shor t-term unsecured debt of corporations. Like all fixed income","page_number":51,"box":{"x":102,"y":302,"width":801,"height":11}},{"id":"bdd59109-38b7-4016-9b87-d95ff82bcabd","block_type":"box","text":"securities, commercial paper prices are susceptible to fluctuations in interest rates. If interest rates rise, commercial","page_number":51,"box":{"x":69,"y":317,"width":836,"height":11}},{"id":"091d0973-c265-476c-842e-e0df8e2b23e2","block_type":"box","text":"paper prices will decline and vice versa. However, the shor t-term nature of a commercial paper investment generally","page_number":51,"box":{"x":70,"y":332,"width":826,"height":11}},{"id":"893c31b2-996e-4e48-a9f1-230beac163f9","block_type":"box","text":"makes it less susceptible to volatility than many other fixed income securities because interest rate risk typically","page_number":51,"box":{"x":69,"y":347,"width":803,"height":11}},{"id":"d4098b59-6fd1-4a26-88e2-9a6149f9de53","block_type":"box","text":"increases as maturity lengths increase. Commercial paper tends to yield smaller returns than longer-term corporate","page_number":51,"box":{"x":70,"y":362,"width":822,"height":11}},{"id":"4d98dd9a-f077-4d55-8cab-0160ecf499a7","block_type":"box","text":"debt because securities with shor ter maturities typically have lower effective yields than those with longer maturities.","page_number":51,"box":{"x":69,"y":377,"width":835,"height":12}},{"id":"611e693a-db5e-46f7-b8ef-1a8fb3566db3","block_type":"box","text":"Commodity-Linked Derivative Instruments and Hybrid Instruments.","page_number":51,"box":{"x":102,"y":400,"width":483,"height":11}},{"id":"197570c3-4a44-4f56-8a02-6cb72ecd2e60","block_type":"box","text":"Cer tain Funds seek to gain exposure to the","page_number":51,"box":{"x":591,"y":400,"width":308,"height":11}},{"id":"5e580d29-9f2e-461d-8527-afdf67ecb340","block_type":"box","text":"commodities markets primarily through investments in hybrid instruments. Hybrid instruments are either equity or","page_number":51,"box":{"x":69,"y":415,"width":809,"height":11}},{"id":"e5630e8c-96d4-4ca9-96a3-8e5d6a51562e","block_type":"box","text":"debt derivative securities with one or more commodity-dependent components that have payment features similar to","page_number":51,"box":{"x":69,"y":430,"width":828,"height":11}},{"id":"5cd3d4d3-dca2-41cc-8993-85507fdb9d43","block_type":"box","text":"a commodity futures contract, a commodity option contract, or a combination of both. Therefore, these instruments","page_number":51,"box":{"x":69,"y":445,"width":822,"height":11}},{"id":"3f6a4c70-e70c-4b8f-98f9-00628cb2facb","block_type":"box","text":"are “commodity-linked.” They are considered “hybrid” instruments because they have both commodity-like and","page_number":51,"box":{"x":69,"y":461,"width":787,"height":11}},{"id":"f3f0448f-663d-4a8b-8eb0-c448dc553365","block_type":"box","text":"security-like characteristics. Hybrid instruments are derivative instruments because at least par t of their value is","page_number":51,"box":{"x":69,"y":475,"width":801,"height":12}},{"id":"4ffeb866-6ba0-4663-8d1e-18047e157d86","block_type":"box","text":"derived from the value of an underlying commodity, futures contract, index or other readily measurable economic","page_number":51,"box":{"x":69,"y":491,"width":800,"height":11}},{"id":"d28b9aac-239a-4af1-aafd-2f2ad71dc4dd","block_type":"box","text":"variable.","page_number":51,"box":{"x":68,"y":506,"width":59,"height":9}},{"id":"63a3a78c-6f59-4e2b-8e7e-980795f9d266","block_type":"box","text":"The prices of commodity-linked derivative instruments may move in different directions than investments in","page_number":51,"box":{"x":101,"y":528,"width":763,"height":12}},{"id":"6fea1d94-ce14-4b48-a4b2-d7130ce32fda","block_type":"box","text":"traditional equity and debt securities when the value of those traditional securities is declining due to adverse","page_number":51,"box":{"x":68,"y":543,"width":783,"height":12}},{"id":"a8a8b9df-e056-417b-82ca-01985f807c52","block_type":"box","text":"economic conditions. As an example, during periods of rising inflation, debt securities have historically tended to","page_number":51,"box":{"x":69,"y":559,"width":802,"height":11}},{"id":"91c39569-7507-4ec0-be4f-69483024de81","block_type":"box","text":"decline in value due to the general increase in prevailing interest rates. Conversely, during those same periods of","page_number":51,"box":{"x":69,"y":574,"width":808,"height":11}},{"id":"94fd72ca-a205-4978-bb6c-c269c7ac1fd9","block_type":"box","text":"rising inflation, the prices of cer tain commodities, such as oil and metals, have historically tended to increase. Of","page_number":51,"box":{"x":69,"y":589,"width":811,"height":11}},{"id":"424a038b-7a9d-40f0-91f5-741d84d531d8","block_type":"box","text":"course, there cannot be any guarantee that these investments will per form in that manner in the future, and at","page_number":51,"box":{"x":69,"y":604,"width":791,"height":11}},{"id":"f4de4676-cbc4-4b24-bd26-cd1bcdcf2520","block_type":"box","text":"cer tain times the price movements of commodity-linked instruments have been parallel to those of debt and equity","page_number":51,"box":{"x":69,"y":619,"width":819,"height":11}},{"id":"1a7eb4c5-2da3-45d9-b944-e1a7dbfdf3d5","block_type":"box","text":"securities. Commodities have historically tended to increase and decrease in value during different par ts of the","page_number":51,"box":{"x":69,"y":634,"width":795,"height":12}},{"id":"3c4e376c-29e6-46dd-b350-a6dc861545a1","block_type":"box","text":"business cycle than financial assets. Never theless, at various times, commodities prices may move in tandem with","page_number":51,"box":{"x":69,"y":649,"width":822,"height":12}},{"id":"727a6bb8-8833-4d19-a810-428631f004f8","block_type":"box","text":"the prices of financial assets and thus may not provide overall por tfolio diversification benefits. Under favorable","page_number":51,"box":{"x":68,"y":664,"width":797,"height":12}},{"id":"2c129e6b-3b5a-48b4-94b1-dc4360b2fcbf","block_type":"box","text":"economic conditions, the Fund’s investments may be expected to under-per form an investment in traditional","page_number":51,"box":{"x":69,"y":680,"width":772,"height":11}},{"id":"adf3dd6b-ca20-425e-951a-edb50d330818","block_type":"box","text":"securities. Over the long term, the returns on the Fund’s investments are expected to exhibit low or negative","page_number":51,"box":{"x":69,"y":695,"width":773,"height":11}},{"id":"7d54efa7-8687-44df-bfbe-5042f28fe9ef","block_type":"box","text":"correlation with stocks and bonds.","page_number":51,"box":{"x":69,"y":710,"width":244,"height":9}},{"id":"8e19adf5-2184-4acd-b42a-14f691e76d49","block_type":"box","text":"Qualifying Hybrid Instruments.","page_number":51,"box":{"x":102,"y":732,"width":212,"height":12}},{"id":"c45c5b8e-1ae7-41c6-bea5-70dfb04d7335","block_type":"box","text":"Cer tain Funds may invest in hybrid instruments that qualify for exclusion from","page_number":51,"box":{"x":320,"y":732,"width":552,"height":12}},{"id":"442d46ec-7800-42db-9f3b-4ae23675c2cb","block_type":"box","text":"regulation under the Commodity Exchange Act and the regulations adopted thereunder. A hybrid instrument that","page_number":51,"box":{"x":69,"y":748,"width":795,"height":11}},{"id":"773e8dfe-ce9a-4cf8-83e5-81064b53149b","block_type":"box","text":"qualifies for this exclusion from regulation must be “predominantly a security.” A hybrid instrument is considered to","page_number":51,"box":{"x":69,"y":763,"width":822,"height":11}},{"id":"9d6ea758-b740-4a11-9dc6-16af8c1f638d","block_type":"box","text":"be predominantly a security if (a) the issuer of the hybrid instrument receives payment in full of the purchase price of","page_number":51,"box":{"x":69,"y":778,"width":834,"height":11}},{"id":"e09b5100-2ae1-4f40-9987-683250ce82bc","block_type":"box","text":"the hybrid instrument, substantially contemporaneously with delivery of the hybrid instrument; (b) the purchaser or","page_number":51,"box":{"x":68,"y":793,"width":816,"height":11}},{"id":"6a790c75-9b2b-49d3-8623-3c7d5ba0a547","block_type":"box","text":"holder of the hybrid instrument is not required to make any payment to the issuer in addition to the purchase price","page_number":51,"box":{"x":69,"y":808,"width":817,"height":11}},{"id":"b96a441a-1900-4fd7-84cf-8b9a6bb0e6db","block_type":"box","text":"paid under subparagraph (a), whether as margin, settlement payment, or otherwise, during the life of the hybrid","page_number":51,"box":{"x":70,"y":823,"width":793,"height":12}},{"id":"eab5235d-75fb-41e3-8e59-01011163e091","block_type":"box","text":"instrument or at maturity; (c) the issuer of the hybrid instrument is not subject by the terms of the instrument to","page_number":51,"box":{"x":70,"y":838,"width":798,"height":11}},{"id":"d482206a-5a00-43dd-9e4d-2e47f4f5466e","block_type":"box","text":"mark-to-market margining requirements; and (d) the hybrid instrument is not marketed as a contract of sale of a","page_number":51,"box":{"x":69,"y":853,"width":797,"height":12}},{"id":"0344ce90-4b64-4f7f-a906-4dcd15aa1120","block_type":"box","text":"commodity for future delivery (or option on such a contract) subject to applicable provisions of the Commodity","page_number":51,"box":{"x":69,"y":869,"width":783,"height":11}},{"id":"5e16c4ef-f53b-4bc9-93f8-49446fabc960","block_type":"box","text":"Exchange Act. Hybrid instruments may be principal protected, par tially protected, or offer no principal protection. A","page_number":51,"box":{"x":70,"y":884,"width":816,"height":11}},{"id":"cc5d830d-379a-471f-977f-b0687731da93","block_type":"box","text":"principal protected hybrid instrument means that the issuer will pay, at a minimum, the par value of the note at","page_number":51,"box":{"x":70,"y":899,"width":791,"height":11}},{"id":"04500fd5-d918-4f00-b5c6-32430c88c93a","block_type":"box","text":"II-4","page_number":51,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"4bfe4ec1-9aef-43c6-9580-817b42989074","block_type":"box","text":"NM1026U-6033063-51/246","page_number":51,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"eca27575-8f46-4228-8233-80920ff28b2d","block_type":"box","text":"maturity. Therefore, if the commodity value to which the hybrid instrument is linked declines over the life of the note,","page_number":52,"box":{"x":69,"y":45,"width":829,"height":11}},{"id":"6f7c75cf-4f29-4398-bcfb-9490c525ad91","block_type":"box","text":"the Fund will receive at maturity the face or stated value of the note. With a principal protected hybrid instrument, the","page_number":52,"box":{"x":68,"y":60,"width":837,"height":11}},{"id":"8b3fe8e3-f241-49e9-8b92-ee4f1fd4d5ba","block_type":"box","text":"Fund will receive at maturity the greater of the par value of the note or the increase in its value based on the","page_number":52,"box":{"x":70,"y":75,"width":772,"height":11}},{"id":"e6160ef6-6118-46a4-a316-f7c2b4414bca","block_type":"box","text":"underlying commodity or index. This protection is, in effect, an option whose value is subject to the volatility and price","page_number":52,"box":{"x":69,"y":90,"width":839,"height":11}},{"id":"19e5080b-fae4-45be-8e13-eb5488068cb4","block_type":"box","text":"level of the underlying commodity. The Manager’s decision whether to use principal protection depends in par t on the","page_number":52,"box":{"x":70,"y":105,"width":835,"height":11}},{"id":"30ef74ce-fb6c-4675-946f-5c5f5f2080c2","block_type":"box","text":"cost of the protection. In addition, the protection feature depends upon the ability of the issuer to meet its obligation","page_number":52,"box":{"x":69,"y":120,"width":833,"height":12}},{"id":"2786145a-57bb-4586-8d4b-57a28a8fdf60","block_type":"box","text":"to buy back the security, and, therefore, depends on the creditwor thiness of the issuer. With full principal protection,","page_number":52,"box":{"x":68,"y":135,"width":831,"height":11}},{"id":"bdb60499-0a07-440a-a53a-d2dedc7001ba","block_type":"box","text":"the Fund will receive at maturity of the hybrid instrument either the stated par value of the hybrid instrument, or","page_number":52,"box":{"x":68,"y":150,"width":795,"height":12}},{"id":"9f1d0cc8-7a19-41f2-8553-9ec5474efd3c","block_type":"box","text":"potentially, an amount greater than the stated par value if the underlying commodity, index, futures contract or","page_number":52,"box":{"x":70,"y":166,"width":784,"height":11}},{"id":"0ee3ca4d-d41f-4c23-8d99-2e62e738877d","block_type":"box","text":"economic variable to which the hybrid instrument is linked has increased in value. Par tially protected hybrid","page_number":52,"box":{"x":69,"y":181,"width":765,"height":11}},{"id":"46c17db5-6834-42ea-8cf4-7aee50e8b06b","block_type":"box","text":"instruments may suffer some loss of principal if the underlying commodity, index, futures contract or economic","page_number":52,"box":{"x":70,"y":196,"width":788,"height":11}},{"id":"ea74ac0b-58e2-49e4-b433-2da5e5907fcf","block_type":"box","text":"variable to which the hybrid instrument is linked declines in value during the term of the hybrid instrument. However,","page_number":52,"box":{"x":68,"y":211,"width":828,"height":11}},{"id":"d454946e-0b7a-4d6f-bfb1-317eeb701003","block_type":"box","text":"par tially protected hybrid instruments have a specified limit as to the amount of principal that they may lose.","page_number":52,"box":{"x":70,"y":226,"width":773,"height":11}},{"id":"4367cb08-c0ed-4e82-abe3-c4cebde10b2d","block_type":"box","text":"Hybrid Instruments Without Principal Protection.","page_number":52,"box":{"x":102,"y":249,"width":339,"height":11}},{"id":"ac1542d1-efee-4b82-b638-1ad12ada4366","block_type":"box","text":"Cer tain Funds may invest in hybrid instruments that offer no","page_number":52,"box":{"x":448,"y":249,"width":429,"height":11}},{"id":"a3d8da26-b3e9-41f5-aecc-202a8a435366","block_type":"box","text":"principal protection. At maturity, there is a risk that the underlying commodity price, futures contract, index or other","page_number":52,"box":{"x":70,"y":264,"width":818,"height":11}},{"id":"344e3435-adc3-443b-a8d8-3722019a7a2d","block_type":"box","text":"economic variable may have declined sufficiently in value such that some or all of the face value of the hybrid","page_number":52,"box":{"x":69,"y":279,"width":780,"height":11}},{"id":"099b5f65-b17d-432e-a195-e8ac9645f889","block_type":"box","text":"instrument might not be returned. The Manager, at its discretion, may invest in a par tially protected principal","page_number":52,"box":{"x":70,"y":294,"width":773,"height":11}},{"id":"33de4fec-5192-47fe-9ad1-2743762db66a","block_type":"box","text":"structured note or a note without principal protection. In deciding to purchase a note without principal protection, the","page_number":52,"box":{"x":69,"y":309,"width":832,"height":11}},{"id":"7c6bdbf7-01a9-4044-9ef8-7bed0616b16f","block_type":"box","text":"Manager may consider, among other things, the expected per formance of the underlying commodity futures contract,","page_number":52,"box":{"x":70,"y":324,"width":831,"height":12}},{"id":"d96df966-235b-4115-a530-5e2fb6f60492","block_type":"box","text":"index or other economic variable over the term of the note, the cost of the note, and any other economic factors that","page_number":52,"box":{"x":70,"y":339,"width":831,"height":12}},{"id":"93ea9b7b-b3a0-4db8-85dd-a7432446c877","block_type":"box","text":"the Manager believes are relevant.","page_number":52,"box":{"x":68,"y":355,"width":247,"height":11}},{"id":"b9feedc3-5cc4-4422-b0e6-25e2c5d1a85e","block_type":"box","text":"Limitations on Leverage.","page_number":52,"box":{"x":102,"y":377,"width":173,"height":12}},{"id":"a6f0b658-edbe-4f81-b7ab-c4af11a19729","block_type":"box","text":"Some of the hybrid instruments in which a Fund may invest may involve leverage. To","page_number":52,"box":{"x":281,"y":377,"width":598,"height":12}},{"id":"3f34340c-818e-4418-a2fb-f29a79dfe46e","block_type":"box","text":"avoid being subject to undue leverage risk, a Fund will seek to limit the amount of economic leverage it has under any","page_number":52,"box":{"x":69,"y":392,"width":840,"height":12}},{"id":"16b057ae-1c0f-40d0-8aaa-a09745fd1531","block_type":"box","text":"one hybrid instrument that it buys and the leverage of the Fund’s overall por tfolio. A Fund will not invest in a hybrid","page_number":52,"box":{"x":69,"y":407,"width":816,"height":12}},{"id":"6745751a-b9e8-457a-9fc3-bcac69d1ee99","block_type":"box","text":"instrument if, at the time of purchase: (i) that instrument’s “leverage ratio” exceeds 300% of the price increase in","page_number":52,"box":{"x":70,"y":423,"width":812,"height":11}},{"id":"823c0510-6995-40db-b343-1de5a84110bd","block_type":"box","text":"the underlying commodity, futures contract, index or other economic variable or (ii) the Fund’s “por tfolio leverage","page_number":52,"box":{"x":68,"y":438,"width":803,"height":11}},{"id":"1daa087d-0ef0-48d7-93d2-2be1dfd4f3f1","block_type":"box","text":"ratio” exceeds 150%, measured at the time of purchase. “Leverage ratio” is the expected increase in the value of a","page_number":52,"box":{"x":69,"y":453,"width":826,"height":11}},{"id":"0cc3e564-6520-444f-8f1d-cffbc29abce8","block_type":"box","text":"hybrid instrument, assuming a one percent price increase in the underlying commodity, futures contract, index or","page_number":52,"box":{"x":69,"y":468,"width":803,"height":11}},{"id":"018433aa-28be-4612-863d-b72205fed656","block_type":"box","text":"other economic factor. In other words, for a hybrid instrument with a leverage factor of 150%, a 1% gain in the","page_number":52,"box":{"x":69,"y":483,"width":783,"height":11}},{"id":"f8635501-54b3-4661-8bb4-79125d4087af","block_type":"box","text":"underlying economic variable would be expected to result in a 1.5% gain in value for the hybrid instrument.","page_number":52,"box":{"x":69,"y":498,"width":758,"height":11}},{"id":"c2cdd7d7-f8e2-4612-9b8e-34894d2e115e","block_type":"box","text":"Conversely, a hybrid instrument with a leverage factor of 150% would suffer a 1.5% loss if the underlying economic","page_number":52,"box":{"x":69,"y":513,"width":818,"height":12}},{"id":"5f733185-601c-4429-8349-c73995e2c122","block_type":"box","text":"variable lost 1% of its value. “Por tfolio leverage ratio” is defined as the average (mean) leverage ratio of all","page_number":52,"box":{"x":68,"y":528,"width":763,"height":12}},{"id":"37326e8b-2c6d-40fb-9e8e-5e8ce499e66d","block_type":"box","text":"instruments in a Fund’s por tfolio, weighted by the market values of such instruments or, in the case of futures","page_number":52,"box":{"x":70,"y":543,"width":787,"height":12}},{"id":"3fdfcce9-049b-4151-874a-856db09e632d","block_type":"box","text":"contracts, their notional values. A Fund may at times or from time to time decide not to use leverage in its","page_number":52,"box":{"x":69,"y":559,"width":757,"height":11}},{"id":"5e530845-d110-48b6-a9fa-b2b41f80a05e","block_type":"box","text":"investments or use less leverage than may otherwise be allowable.","page_number":52,"box":{"x":70,"y":574,"width":477,"height":11}},{"id":"8c83c258-a3dd-4141-92c1-ae1ad31c393f","block_type":"box","text":"Counterpar ty Risk.","page_number":52,"box":{"x":102,"y":597,"width":130,"height":11}},{"id":"45b400c2-d5cd-4157-84c1-1589d4b15b6f","block_type":"box","text":"A significant risk of hybrid instruments is counterpar ty risk. Unlike exchange-traded futures","page_number":52,"box":{"x":238,"y":596,"width":646,"height":12}},{"id":"d76d2b4a-c13b-49ee-b749-2b42a37a720b","block_type":"box","text":"and options, which are standard contracts, hybrid instruments are customized securities, tailor-made by a specific","page_number":52,"box":{"x":69,"y":612,"width":813,"height":11}},{"id":"6fb7e833-9f65-4f57-8a3c-df07fa433eb4","block_type":"box","text":"issuer. With a listed futures or options contract, an investor’s counterpar ty is the exchange clearinghouse. Exchange","page_number":52,"box":{"x":70,"y":627,"width":829,"height":11}},{"id":"03e35a40-71aa-4599-9964-9ad307225a69","block_type":"box","text":"clearinghouses are capitalized by the exchange members and typically have high investment grade ratings (","page_number":52,"box":{"x":69,"y":642,"width":763,"height":11}},{"id":"2311505d-d0f3-4fc7-bae8-cc23a2b83696","block_type":"box","text":"e.g.","page_number":52,"box":{"x":834,"y":643,"width":25,"height":10}},{"id":"6855be79-91c8-434c-9ae1-7568970feca2","block_type":"box","text":",","page_number":52,"box":{"x":861,"y":649,"width":2,"height":3}},{"id":"fb2705c9-85ce-4ebe-9071-ee2d66e0f25a","block_type":"box","text":"ratings of AAA or AA by S&P). Therefore, the risk is small that an exchange clearinghouse might be unable to meet its","page_number":52,"box":{"x":69,"y":657,"width":836,"height":11}},{"id":"80edcfe9-a3bb-4820-8522-14b6de6fa042","block_type":"box","text":"obligations at maturity. However, with a hybrid instrument, a Fund will take on the counterpar ty credit risk of the","page_number":52,"box":{"x":69,"y":672,"width":795,"height":11}},{"id":"ffeabd6b-ce3f-4b57-ad3b-fcdf22447a90","block_type":"box","text":"issuer. That is, at maturity of the hybrid instrument, there is a risk that the issuer may be unable to per form its","page_number":52,"box":{"x":70,"y":687,"width":791,"height":11}},{"id":"d77a8ca6-deb5-4cf5-9bcf-695bf64b336b","block_type":"box","text":"obligations under the structured note.","page_number":52,"box":{"x":69,"y":703,"width":268,"height":11}},{"id":"185fc963-5cbe-44bc-8224-2ca26307b233","block_type":"box","text":"Convertible Securities.","page_number":52,"box":{"x":102,"y":725,"width":165,"height":9}},{"id":"7e2ad2ab-575c-4170-9006-5250be4f1f58","block_type":"box","text":"A conver tible security is a bond, debenture, note, preferred stock or other security that","page_number":52,"box":{"x":273,"y":725,"width":619,"height":11}},{"id":"03693745-5259-40be-9891-7a7c6a74f490","block_type":"box","text":"may be conver ted into or exchanged for a prescribed amount of common stock or other equity security of the same or","page_number":52,"box":{"x":69,"y":740,"width":839,"height":11}},{"id":"f0550c38-1121-4b15-a100-bd409f43517e","block_type":"box","text":"a different issuer within a par ticular period of time at a specified price or formula. A conver tible security entitles the","page_number":52,"box":{"x":69,"y":755,"width":826,"height":11}},{"id":"e8587459-0b7f-4505-9212-969e641338e1","block_type":"box","text":"holder to receive interest paid or accrued on debt or the dividend paid on preferred stock until the conver tible","page_number":52,"box":{"x":69,"y":770,"width":781,"height":11}},{"id":"86949582-5cf4-4c64-be9c-b8101665b72b","block_type":"box","text":"security matures or is redeemed, conver ted or exchanged. Before conversion, conver tible securities have","page_number":52,"box":{"x":69,"y":785,"width":750,"height":12}},{"id":"f3c6cdaa-2f22-44e9-addf-2793d5191b57","block_type":"box","text":"characteristics similar to nonconver tible income securities in that they ordinarily provide a stable stream of income","page_number":52,"box":{"x":69,"y":801,"width":819,"height":11}},{"id":"59100547-1062-4c75-943f-eccbf195e6b0","block_type":"box","text":"with generally higher yields than those of common stocks of the same or similar issuers, but lower yields than","page_number":52,"box":{"x":68,"y":816,"width":784,"height":11}},{"id":"782eab17-bdc3-4161-b116-463d09e629db","block_type":"box","text":"comparable nonconver tible securities. The value of a conver tible security is influenced by changes in interest rates,","page_number":52,"box":{"x":69,"y":831,"width":823,"height":11}},{"id":"a877ba6b-29c4-4839-acc9-f44d7bd59e14","block_type":"box","text":"with investment value declining as interest rates increase and increasing as interest rates decline. The credit","page_number":52,"box":{"x":68,"y":846,"width":780,"height":11}},{"id":"e1344aad-ea59-4135-b9b8-57519451f706","block_type":"box","text":"standing of the issuer and other factors also may have an effect on the conver tible security’s investment value.","page_number":52,"box":{"x":69,"y":861,"width":795,"height":11}},{"id":"6898d058-0106-4a13-b8eb-653e20988707","block_type":"box","text":"Conver tible securities rank senior to common stock in a corporation’s capital structure but are usually subordinated","page_number":52,"box":{"x":69,"y":876,"width":826,"height":11}},{"id":"33403c7e-eabb-4ffe-830d-41799d64dfe0","block_type":"box","text":"to comparable nonconver tible securities. Conver tible securities may be subject to redemption at the option of the","page_number":52,"box":{"x":68,"y":891,"width":811,"height":11}},{"id":"344c4599-25b7-45a5-93de-57f5ffa43939","block_type":"box","text":"issuer at a price established in the conver tible security’s governing instrument.","page_number":52,"box":{"x":70,"y":907,"width":563,"height":11}},{"id":"ae1da8f0-b39b-4c79-ad22-70b6ee224ee5","block_type":"box","text":"II-5","page_number":52,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"d2eace0a-a487-4098-a5dd-262a222f4095","block_type":"box","text":"NM1026U-6033063-52/246","page_number":52,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"d25f320a-8583-491a-b093-6b342b596289","block_type":"box","text":"The characteristics of conver tible securities make them potentially attractive investments for an investment","page_number":53,"box":{"x":101,"y":45,"width":767,"height":11}},{"id":"55946917-591d-4dd4-b467-5ab3cca9da99","block_type":"box","text":"company seeking a high total return from capital appreciation and investment income. These characteristics include","page_number":53,"box":{"x":69,"y":60,"width":826,"height":11}},{"id":"ab78450e-0173-4b8c-93e7-c1a4784929e5","block_type":"box","text":"the potential for capital appreciation as the value of the underlying common stock increases, the relatively high yield","page_number":53,"box":{"x":68,"y":75,"width":829,"height":11}},{"id":"89c83020-2708-416e-a7f0-b4c538a64089","block_type":"box","text":"received from dividend or interest payments as compared to common stock dividends and decreased risks of decline","page_number":53,"box":{"x":69,"y":90,"width":834,"height":11}},{"id":"5bd2290d-bd40-4c18-b0a3-1bd30ebef067","block_type":"box","text":"in value relative to the underlying common stock due to their fixed-income nature. As a result of the conversion","page_number":53,"box":{"x":70,"y":105,"width":788,"height":11}},{"id":"4e06fc8c-ed4c-49ac-8eda-e90b0c0483fa","block_type":"box","text":"feature, however, the interest rate or dividend preference on a conver tible security is generally less than would be the","page_number":53,"box":{"x":68,"y":120,"width":839,"height":12}},{"id":"955302b7-e03b-41c7-b002-366bac05d055","block_type":"box","text":"case if the securities were issued in nonconver tible form.","page_number":53,"box":{"x":69,"y":135,"width":409,"height":9}},{"id":"a70a6767-fd5b-45d6-a9ec-5919577ddd7a","block_type":"box","text":"In analyzing conver tible securities, the Manager will consider both the yield on the conver tible security relative to","page_number":53,"box":{"x":102,"y":158,"width":802,"height":11}},{"id":"d2f2392d-ffd5-48b7-a603-5073bbe2d0ed","block_type":"box","text":"its credit quality and the potential capital appreciation that is offered by the underlying common stock, among other","page_number":53,"box":{"x":70,"y":173,"width":824,"height":11}},{"id":"b55f8269-57ba-46c8-9f5b-d8d6b67dc68f","block_type":"box","text":"things.","page_number":53,"box":{"x":68,"y":188,"width":47,"height":12}},{"id":"823ee418-4535-4a6f-95a2-984c0fac40bd","block_type":"box","text":"Conver tible securities are issued and traded in a number of securities markets. Even in cases where a","page_number":53,"box":{"x":102,"y":211,"width":731,"height":9}},{"id":"68c54fe8-df8d-47c5-9237-a7492b4af479","block_type":"box","text":"substantial por tion of the conver tible securities held by a Fund are denominated in U.S. dollars, the underlying equity","page_number":53,"box":{"x":69,"y":226,"width":836,"height":11}},{"id":"faaa1cc4-4f55-434c-a2ff-adee37e25e61","block_type":"box","text":"securities may be quoted in the currency of the country where the issuer is domiciled. As a result, fluctuations in the","page_number":53,"box":{"x":69,"y":241,"width":832,"height":11}},{"id":"accabe57-41b6-4b8e-b851-8274723f8638","block_type":"box","text":"exchange rate between the currency in which the debt security is denominated and the currency in which the share","page_number":53,"box":{"x":69,"y":257,"width":818,"height":11}},{"id":"4f3a6571-4edf-4d00-ba6c-da2adfe2fb4f","block_type":"box","text":"price is quoted will affect the value of the conver tible security. With respect to conver tible securities denominated in","page_number":53,"box":{"x":70,"y":271,"width":828,"height":12}},{"id":"1cb1e2e0-90b7-4c1f-bbca-8bc6781cf4a7","block_type":"box","text":"a currency different from that of the underlying equity securities, the conversion price may be based on a fixed","page_number":53,"box":{"x":69,"y":286,"width":786,"height":12}},{"id":"bcb38ec6-a35d-4534-98d3-dffc8634cd2b","block_type":"box","text":"exchange rate established at the time the security is issued, which may increase the effects of currency risk. As","page_number":53,"box":{"x":69,"y":302,"width":800,"height":11}},{"id":"8807b28d-e003-437f-9c6e-e7b93b830117","block_type":"box","text":"described below, a Fund is authorized to enter into foreign currency hedging transactions in which it may seek to","page_number":53,"box":{"x":69,"y":317,"width":800,"height":11}},{"id":"34cc1405-3ee9-4a33-b200-22e3fb52aed2","block_type":"box","text":"reduce the effect of exchange rate fluctuations.","page_number":53,"box":{"x":69,"y":332,"width":337,"height":11}},{"id":"686d8c5d-82c7-4f9f-8a2d-95a60d097945","block_type":"box","text":"Apar t from currency considerations, the value of conver tible securities is influenced by both the yield on","page_number":53,"box":{"x":101,"y":355,"width":741,"height":11}},{"id":"a6b51a3e-9620-4992-9c0d-5382731517ba","block_type":"box","text":"nonconver tible securities of comparable issuers and by the value of the underlying common stock. The value of a","page_number":53,"box":{"x":69,"y":370,"width":806,"height":11}},{"id":"ec34a8ae-a2cd-439e-95b9-87806eeb68f0","block_type":"box","text":"conver tible security viewed without regard to its conversion feature (","page_number":53,"box":{"x":69,"y":385,"width":485,"height":11}},{"id":"4d41d866-d523-4c40-b56c-174551b10af1","block_type":"box","text":"i.e.","page_number":53,"box":{"x":557,"y":385,"width":20,"height":9}},{"id":"d1cf907a-8702-4a20-8257-ef846fa4cac6","block_type":"box","text":", strictly on the basis of its yield) is","page_number":53,"box":{"x":579,"y":385,"width":248,"height":11}},{"id":"1836f005-7570-457e-8ed4-62c09ed92803","block_type":"box","text":"sometimes referred to as its “investment value.” To the extent interest rates change, the investment value of the","page_number":53,"box":{"x":69,"y":400,"width":808,"height":11}},{"id":"5fa5abc4-9464-48f0-ab6e-0a69611a3437","block_type":"box","text":"conver tible security typically will fluctuate. At the same time, however, the value of the conver tible security will be","page_number":53,"box":{"x":69,"y":415,"width":807,"height":11}},{"id":"f09c4946-2d9c-49b1-b610-517a75e2cfcc","block_type":"box","text":"influenced by its “conversion value,” which is the market value of the underlying common stock that would be","page_number":53,"box":{"x":70,"y":430,"width":778,"height":11}},{"id":"c3ae8411-9982-4cc4-8840-add037416bcd","block_type":"box","text":"obtained if the conver tible security were conver ted. Conversion value fluctuates directly with the price of the","page_number":53,"box":{"x":69,"y":445,"width":769,"height":11}},{"id":"7227a1dc-828f-4b6b-908a-f95f80adc9a7","block_type":"box","text":"underlying common stock. If the conversion value of a conver tible security is substantially below its investment value,","page_number":53,"box":{"x":69,"y":460,"width":837,"height":12}},{"id":"fc8c8231-dad4-4cbe-8ed4-49bec98dfcda","block_type":"box","text":"the price of the conver tible security is governed principally by its investment value. To the extent the conversion value","page_number":53,"box":{"x":68,"y":475,"width":837,"height":12}},{"id":"798331d3-d9db-46fc-acaa-1f2ee202fc58","block_type":"box","text":"of a conver tible security increases to a point that approximates or exceeds its investment value, the price of the","page_number":53,"box":{"x":69,"y":491,"width":800,"height":11}},{"id":"3b2f9183-987a-4f04-a48e-6eed115a84d5","block_type":"box","text":"conver tible security will be influenced principally by its conversion value. A conver tible security will sell at a premium","page_number":53,"box":{"x":69,"y":506,"width":828,"height":11}},{"id":"a2b7c99a-6a79-4cf7-ab69-9f46d858000f","block_type":"box","text":"over the conversion value to the extent investors place value on the right to acquire the underlying common stock","page_number":53,"box":{"x":69,"y":521,"width":808,"height":11}},{"id":"34c010b6-7c0c-4b00-aeb2-f67f596d4df2","block_type":"box","text":"while holding a fixed-income security. The yield and conversion premium of conver tible securities issued in Japan and","page_number":53,"box":{"x":68,"y":536,"width":835,"height":11}},{"id":"e86e8a97-1061-4199-ab0b-434043624813","block_type":"box","text":"the Euromarket are frequently determined at levels that cause the conversion value to affect their market value more","page_number":53,"box":{"x":68,"y":551,"width":836,"height":11}},{"id":"6d138daa-8652-40f6-a7ef-f2eda9d53ac0","block_type":"box","text":"than the securities’ investment value.","page_number":53,"box":{"x":68,"y":566,"width":268,"height":9}},{"id":"4c02f61d-2d6d-4bb7-ba8f-7fcbc035e2fc","block_type":"box","text":"Holders of conver tible securities generally have a claim on the assets of the issuer prior to the common","page_number":53,"box":{"x":102,"y":589,"width":740,"height":11}},{"id":"ddad8163-a296-44b9-8532-61a61d9b14f4","block_type":"box","text":"stockholders but may be subordinated to other debt securities of the same issuer. A conver tible security may be","page_number":53,"box":{"x":69,"y":604,"width":801,"height":11}},{"id":"513e8e31-708b-478e-a5fc-6cdd70380e25","block_type":"box","text":"subject to redemption at the option of the issuer at a price established in a char ter provision, indenture or other","page_number":53,"box":{"x":69,"y":619,"width":800,"height":11}},{"id":"2ca44ed3-e3fe-42fa-a025-9c341ba81509","block_type":"box","text":"governing instrument pursuant to which the conver tible security was issued. If a conver tible security held by a Fund is","page_number":53,"box":{"x":68,"y":634,"width":840,"height":12}},{"id":"0a91decf-9b05-48e1-843d-d75ca1acae16","block_type":"box","text":"called for redemption, the Fund will be required to redeem the security, conver t it into the underlying common stock","page_number":53,"box":{"x":69,"y":649,"width":823,"height":12}},{"id":"b9272782-0456-4ff6-a154-653ca95e97bc","block_type":"box","text":"or sell it to a third par ty. Cer tain conver tible debt securities may provide a put option to the holder, which entitles the","page_number":53,"box":{"x":69,"y":665,"width":835,"height":11}},{"id":"66b39423-4669-4f3a-bda1-ea4369229d82","block_type":"box","text":"holder to cause the security to be redeemed by the issuer at a premium over the stated principal amount of the debt","page_number":53,"box":{"x":69,"y":680,"width":832,"height":11}},{"id":"cdaa6692-3efe-490e-9688-753dc723dbf1","block_type":"box","text":"security under cer tain circumstances.","page_number":53,"box":{"x":69,"y":695,"width":267,"height":11}},{"id":"f64ae80a-e456-4d4d-a3ab-51b8736bc679","block_type":"box","text":"A Fund may also invest in synthetic conver tible securities. Synthetic conver tible securities may include either","page_number":53,"box":{"x":101,"y":718,"width":777,"height":11}},{"id":"bb4c9e72-14e5-473e-88c9-99330f85bb8e","block_type":"box","text":"Cash-Settled Conver tibles or Manufactured Conver tibles. “Cash-Settled Conver tibles” are instruments that are","page_number":53,"box":{"x":69,"y":732,"width":789,"height":10}},{"id":"388eb167-4c80-443b-b111-987a59f3cd09","block_type":"box","text":"created by the issuer and have the economic characteristics of traditional conver tible securities but may not actually","page_number":53,"box":{"x":69,"y":748,"width":831,"height":11}},{"id":"c4aa2239-682a-4f71-9eb9-f112f2297afd","block_type":"box","text":"permit conversion into the underlying equity securities in all circumstances. As an example, a private company may","page_number":53,"box":{"x":70,"y":763,"width":819,"height":11}},{"id":"e6ab0457-3349-421c-977c-09f5730de6a1","block_type":"box","text":"issue a Cash-Settled Conver tible that is conver tible into common stock only if the company successfully completes a","page_number":53,"box":{"x":70,"y":778,"width":833,"height":11}},{"id":"d9b19805-f673-470f-b12a-a6cf2fec3c83","block_type":"box","text":"public offering of its common stock prior to maturity and otherwise pays a cash amount to reflect any equity","page_number":53,"box":{"x":70,"y":793,"width":769,"height":11}},{"id":"11294a3d-c732-44da-a1d1-2f908a0804e2","block_type":"box","text":"appreciation. “Manufactured Conver tibles” are created by the Manager or another par ty by combining separate","page_number":53,"box":{"x":69,"y":808,"width":791,"height":11}},{"id":"541d6166-10f4-4427-9e72-43c14b4dc060","block_type":"box","text":"securities that possess one of the two principal characteristics of a conver tible security,","page_number":53,"box":{"x":69,"y":823,"width":627,"height":11}},{"id":"d9431395-6027-45f1-be4c-486d0456c309","block_type":"box","text":"i.e.","page_number":53,"box":{"x":703,"y":823,"width":20,"height":9}},{"id":"6e6b1842-a3db-4d16-8a33-c8541d310713","block_type":"box","text":", fixed-income (“fixed","page_number":53,"box":{"x":726,"y":823,"width":151,"height":11}},{"id":"a6f0ce8f-8ebe-40ce-ba07-4f37358ee772","block_type":"box","text":"income component”) or a right to acquire equity securities (“conver tibility component”). The fixed-income component","page_number":53,"box":{"x":70,"y":838,"width":830,"height":12}},{"id":"aff7c718-0fe2-4d0f-8669-b12bf56940f8","block_type":"box","text":"is achieved by investing in nonconver tible fixed-income securities, such as nonconver tible bonds, preferred stocks","page_number":53,"box":{"x":70,"y":853,"width":814,"height":12}},{"id":"77068e94-c05a-403e-8327-5f2ec35381a1","block_type":"box","text":"and money market instruments. The conver tibility component is achieved by investing in call options, warrants, or","page_number":53,"box":{"x":69,"y":869,"width":811,"height":11}},{"id":"48575c1a-7e99-4199-a6ec-c3ba986e7724","block_type":"box","text":"other securities with equity conversion features (“equity features”) granting the holder the right to purchase a","page_number":53,"box":{"x":69,"y":884,"width":779,"height":11}},{"id":"2ff4eace-b670-4807-badf-c2dcb441ceab","block_type":"box","text":"II-6","page_number":53,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"b7cbefce-1777-4028-9053-d5b93bdf28e2","block_type":"box","text":"NM1026U-6033063-53/246","page_number":53,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"abaddb94-6b6b-4efd-bdc2-7cbb0ef652f2","block_type":"box","text":"specified quantity of the underlying stocks within a specified period of time at a specified price or, in the case of a","page_number":54,"box":{"x":69,"y":45,"width":813,"height":11}},{"id":"865bd59e-12ff-4233-b209-18b21fa32b28","block_type":"box","text":"stock index option, the right to receive a cash payment based on the value of the underlying stock index.","page_number":54,"box":{"x":69,"y":60,"width":744,"height":11}},{"id":"92399c1d-d5ca-4d41-9e6a-5267cca30e0b","block_type":"box","text":"A Manufactured Conver tible differs from traditional conver tible securities in several respects. Unlike a traditional","page_number":54,"box":{"x":101,"y":82,"width":804,"height":11}},{"id":"ee79ec9b-5cba-44c0-b515-701a33923f7a","block_type":"box","text":"conver tible security, which is a single security that has a unitary market value, a Manufactured Conver tible is","page_number":54,"box":{"x":69,"y":98,"width":777,"height":11}},{"id":"b249d48c-c313-4367-81d3-24a676072eee","block_type":"box","text":"comprised of two or more separate securities, each with its own market value. Therefore, the total “market value” of","page_number":54,"box":{"x":69,"y":113,"width":832,"height":11}},{"id":"54afc6dd-4bcc-457a-92db-721cc3dea1ab","block_type":"box","text":"such a Manufactured Conver tible is the sum of the values of its fixed-income component and its conver tibility","page_number":54,"box":{"x":69,"y":128,"width":781,"height":11}},{"id":"1657e518-d6b8-4517-9c3c-6d33ba41f538","block_type":"box","text":"component.","page_number":54,"box":{"x":69,"y":144,"width":82,"height":10}},{"id":"b3112bec-e5e2-4a47-b3b5-1f61c3461d5b","block_type":"box","text":"More flexibility is possible in the creation of a Manufactured Conver tible than in the purchase of a traditional","page_number":54,"box":{"x":102,"y":166,"width":773,"height":11}},{"id":"806b5b2c-34fa-48b3-90f5-fff83f574a24","block_type":"box","text":"conver tible security. Because many corporations have not issued conver tible securities, the Manager may combine a","page_number":54,"box":{"x":69,"y":181,"width":833,"height":11}},{"id":"fc07fccc-6ae0-4b30-85a1-32bd64010705","block_type":"box","text":"fixed-income instrument and an equity feature with respect to the stock of the issuer of the fixed-income instrument","page_number":54,"box":{"x":68,"y":196,"width":826,"height":11}},{"id":"9bedefba-8635-40d8-93a9-15aec6db756a","block_type":"box","text":"to create a synthetic conver tible security otherwise unavailable in the market. The Manager may also combine a","page_number":54,"box":{"x":68,"y":211,"width":800,"height":11}},{"id":"2d0f06c3-2c56-4fed-8c2b-f4e332df6834","block_type":"box","text":"fixed-income instrument of an issuer with an equity feature with respect to the stock of a different issuer when the","page_number":54,"box":{"x":68,"y":226,"width":817,"height":11}},{"id":"5a0be55d-6116-46d6-b7b1-e1e958a11c0f","block_type":"box","text":"Manager believes such a Manufactured Conver tible would better promote a Fund’s objective than alternative","page_number":54,"box":{"x":70,"y":241,"width":772,"height":11}},{"id":"0b4d7566-7091-44f3-83a0-1355126405b7","block_type":"box","text":"investments. For example, the Manager may combine an equity feature with respect to an issuer’s stock with a fixed","page_number":54,"box":{"x":70,"y":256,"width":833,"height":12}},{"id":"2c811a42-b698-43a5-8d55-40320103e4c2","block_type":"box","text":"income security of a different issuer in the same industry to diversify the Fund’s credit exposure, or with a U.S.","page_number":54,"box":{"x":70,"y":271,"width":790,"height":12}},{"id":"af161c19-ef2f-4c34-91a0-5171bca19348","block_type":"box","text":"Treasury instrument to create a Manufactured Conver tible with a higher credit profile than a traditional conver tible","page_number":54,"box":{"x":68,"y":286,"width":815,"height":12}},{"id":"267a6b3b-3d75-429a-8915-28440e85023e","block_type":"box","text":"security issued by that issuer. A Manufactured Conver tible also is a more flexible investment in that its two","page_number":54,"box":{"x":69,"y":302,"width":764,"height":11}},{"id":"7313237e-888e-4592-a724-2b6e2a73114a","block_type":"box","text":"components may be purchased separately and, upon purchasing the separate securities, “combined” to create a","page_number":54,"box":{"x":69,"y":317,"width":806,"height":11}},{"id":"29bc04e0-df51-468f-af56-91513476ddbf","block_type":"box","text":"Manufactured Conver tible. For example, the Fund may purchase a warrant for eventual inclusion in a Manufactured","page_number":54,"box":{"x":70,"y":332,"width":818,"height":11}},{"id":"79f18c19-3375-4d79-9d56-358ba32d5508","block_type":"box","text":"Conver tible while postponing the purchase of a suitable bond to pair with the warrant pending development of more","page_number":54,"box":{"x":69,"y":347,"width":824,"height":11}},{"id":"478635dd-191e-4798-8445-c123f93e365e","block_type":"box","text":"favorable market conditions.","page_number":54,"box":{"x":68,"y":362,"width":202,"height":9}},{"id":"164d25c9-17a3-4242-92a4-54d65ce52cf9","block_type":"box","text":"The value of a Manufactured Conver tible may respond to cer tain market fluctuations differently from a traditional","page_number":54,"box":{"x":101,"y":385,"width":805,"height":11}},{"id":"a07492e4-5efd-4697-8885-609e28e21b72","block_type":"box","text":"conver tible security with similar characteristics. For example, in the event a Fund created a Manufactured Conver tible","page_number":54,"box":{"x":69,"y":400,"width":837,"height":11}},{"id":"49033795-4ce5-4329-983c-7da9b14e35da","block_type":"box","text":"by combining a shor t-term U.S. Treasury instrument and a call option on a stock, the Manufactured Conver tible would","page_number":54,"box":{"x":69,"y":415,"width":839,"height":11}},{"id":"f268e552-7f40-418b-843c-237519fe574e","block_type":"box","text":"be expected to outper form a traditional conver tible of similar maturity that is conver tible into that stock during","page_number":54,"box":{"x":69,"y":430,"width":787,"height":11}},{"id":"2fc4c53f-e442-42b1-9475-0af5782b3374","block_type":"box","text":"periods when Treasury instruments outper form corporate fixed-income securities and underper form during periods","page_number":54,"box":{"x":70,"y":445,"width":815,"height":12}},{"id":"28a04fc0-8e3f-4e00-9c50-dc0034834aca","block_type":"box","text":"when corporate fixed-income securities outper form Treasury instruments.","page_number":54,"box":{"x":68,"y":460,"width":523,"height":12}},{"id":"2f60b417-cbdd-4d67-b6ea-a685bd9f67bc","block_type":"box","text":"Corporate Loans.","page_number":54,"box":{"x":102,"y":483,"width":123,"height":11}},{"id":"d68f779e-0dac-40a7-8be7-a35f0d1bb338","block_type":"box","text":"Cer tain Funds may invest in corporate loans. Corporate loans are generally non-investment","page_number":54,"box":{"x":231,"y":483,"width":647,"height":11}},{"id":"3f0ee07b-376e-4440-b688-18f740dd3d7e","block_type":"box","text":"grade floating rate instruments. Usually, they are freely callable at the issuer’s option. Cer tain Funds may invest in","page_number":54,"box":{"x":68,"y":498,"width":817,"height":11}},{"id":"ff39bfcb-a141-4c0b-bcb3-17e8d7b8a7f9","block_type":"box","text":"fixed and floating rate loans (“Loans”) arranged through private negotiations between a corporate borrower or a","page_number":54,"box":{"x":68,"y":513,"width":794,"height":12}},{"id":"865635f1-fbd1-43ff-9b51-d4f9a327130a","block_type":"box","text":"foreign sovereign entity and one or more financial institutions or institutional investors (“Lenders”). A Fund may invest","page_number":54,"box":{"x":68,"y":528,"width":841,"height":12}},{"id":"1ad412b1-af30-4926-bcba-decbc044c842","block_type":"box","text":"in such Loans in the form of par ticipations in Loans (“Par ticipations”) and assignments of all or a por tion of Loans","page_number":54,"box":{"x":70,"y":543,"width":818,"height":12}},{"id":"af136d4c-43cd-41b2-bd48-2a8f67401587","block_type":"box","text":"from third par ties (“Assignments”). A Fund considers these investments to be investments in debt securities for","page_number":54,"box":{"x":68,"y":559,"width":801,"height":11}},{"id":"77937ec4-cfda-4afa-8ab4-e3eb29d4d8f2","block_type":"box","text":"purposes of its investment policies. Par ticipations typically will result in the Fund having a contractual relationship","page_number":54,"box":{"x":70,"y":574,"width":811,"height":11}},{"id":"a5a0222e-443a-4f85-98b5-b98d4fddca20","block_type":"box","text":"only with the Lender, not with the borrower. The Fund will have the right to receive payments of principal, interest and","page_number":54,"box":{"x":69,"y":589,"width":833,"height":11}},{"id":"63b268eb-8ac1-402d-a474-e97adad40887","block_type":"box","text":"any fees to which it is entitled only from the Lender selling the Par ticipation and only upon receipt by the Lender of","page_number":54,"box":{"x":69,"y":604,"width":817,"height":11}},{"id":"ac81df69-527e-45ff-a0c4-7c5a7e123a42","block_type":"box","text":"the payments from the borrower. In connection with purchasing Par ticipations, the Fund generally will have no right to","page_number":54,"box":{"x":68,"y":619,"width":836,"height":11}},{"id":"8fa40e13-c490-40e8-b9ba-ecbdcf4e7fd7","block_type":"box","text":"enforce compliance by the borrower with the terms of the loan agreement relating to the Loans, nor any rights of set","page_number":54,"box":{"x":69,"y":634,"width":833,"height":12}},{"id":"763a1337-c615-4e09-b348-c7a51c82c493","block_type":"box","text":"off against the borrower, and the Fund may not benefit directly from any collateral suppor ting the Loan in which it has","page_number":54,"box":{"x":69,"y":649,"width":837,"height":12}},{"id":"9faa9dc0-e804-49b4-ac1c-d3f04c1c3e5a","block_type":"box","text":"purchased the Par ticipation. As a result, the Fund will assume the credit risk of both the borrower and the Lender","page_number":54,"box":{"x":70,"y":664,"width":809,"height":11}},{"id":"5a2645c7-ccd0-438b-98f2-0125f7da58ae","block_type":"box","text":"that is selling the Par ticipation. In the event of the insolvency of the Lender selling the Par ticipation, the Fund may be","page_number":54,"box":{"x":68,"y":680,"width":838,"height":11}},{"id":"03700133-281f-4df8-ab31-c66d7c2ad061","block_type":"box","text":"treated as a general creditor of the Lender and may not benefit from any set-off between the Lender and the","page_number":54,"box":{"x":68,"y":695,"width":772,"height":11}},{"id":"2422b706-d9b6-4098-ae82-1aaa5a4bbfb3","block_type":"box","text":"borrower. The Fund will acquire Par ticipations only if the Lender interpositioned between the Fund and the borrower is","page_number":54,"box":{"x":69,"y":710,"width":837,"height":11}},{"id":"0614296e-7bdb-427e-a4de-72337749cca1","block_type":"box","text":"determined by the Fund’s manager to be creditwor thy. When the Fund purchases Assignments from Lenders, the","page_number":54,"box":{"x":69,"y":725,"width":804,"height":11}},{"id":"a5e53002-42f0-4670-aef4-b80bc8e270b9","block_type":"box","text":"Fund will acquire direct rights against the borrower on the Loan, and will not have exposure to a counterpar ty’s credit","page_number":54,"box":{"x":70,"y":740,"width":834,"height":11}},{"id":"67ac7921-5d08-46dc-b157-9518ab86ece1","block_type":"box","text":"risk. The Funds may enter into Par ticipations and Assignments on a forward commitment or “when-issued” basis,","page_number":54,"box":{"x":69,"y":755,"width":809,"height":11}},{"id":"063e252f-052f-4155-93e7-ad2eac9db46f","block_type":"box","text":"whereby a Fund would agree to purchase a Par ticipation or Assignment at set terms in the future. For more","page_number":54,"box":{"x":68,"y":770,"width":764,"height":12}},{"id":"cfb36909-fd61-4fe0-bbe8-66a24fa44a84","block_type":"box","text":"information on forward commitments and when-issued securities, see “When-Issued Securities, Delayed Delivery","page_number":54,"box":{"x":70,"y":785,"width":805,"height":12}},{"id":"0c310f14-89fc-4043-8af6-3e1dc47612f5","block_type":"box","text":"Securities and Forward Commitments” below.","page_number":54,"box":{"x":69,"y":801,"width":324,"height":9}},{"id":"801cf823-0711-4bbe-a1d7-a5f1c7825bdb","block_type":"box","text":"A Fund may have difficulty disposing of Assignments and Par ticipations. In cer tain cases, the market for such","page_number":54,"box":{"x":101,"y":823,"width":782,"height":12}},{"id":"8830b216-da79-474c-ab7d-7b2a5fa367d4","block_type":"box","text":"instruments may lack sufficient liquidity, and therefore the Fund anticipates that in such cases such instruments","page_number":54,"box":{"x":70,"y":838,"width":803,"height":11}},{"id":"426c9b85-c794-4342-a7ca-1836a32ea725","block_type":"box","text":"could be sold only to a limited number of institutional investors. The lack of a sufficiently liquid secondary market","page_number":54,"box":{"x":69,"y":853,"width":809,"height":12}},{"id":"f1370023-1f91-466a-a211-3be4362a5698","block_type":"box","text":"may have an adverse impact on the value of such instruments and on the Fund’s ability to dispose of par ticular","page_number":54,"box":{"x":69,"y":869,"width":795,"height":11}},{"id":"88558a03-cf5a-4a53-adcc-3697256317bd","block_type":"box","text":"Assignments or Par ticipations in response to a specific economic event, such as deterioration in the creditwor thiness","page_number":54,"box":{"x":68,"y":884,"width":841,"height":11}},{"id":"dcc5c3e9-68fd-44d3-a640-4d58e23d5518","block_type":"box","text":"of the borrower.","page_number":54,"box":{"x":69,"y":899,"width":111,"height":9}},{"id":"c40e3b0b-ea6d-4c7f-8d78-902b92e6daf7","block_type":"box","text":"II-7","page_number":54,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"9c84eb53-50ad-4244-b86a-21bc2b5f1d8b","block_type":"box","text":"NM1026U-6033063-54/246","page_number":54,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"a0bf1f94-91d3-4df5-938a-8353080fc49b","block_type":"box","text":"Leading financial institutions often act as agent for a broader group of Lenders, generally referred to as a","page_number":55,"box":{"x":102,"y":45,"width":750,"height":11}},{"id":"5b1b25bb-cd8c-46be-a0bb-d39f61a8b336","block_type":"box","text":"syndicate. The syndicate’s agent arranges the loans, holds collateral and accepts payments of principal and interest.","page_number":55,"box":{"x":69,"y":60,"width":834,"height":11}},{"id":"c0b91458-5cdd-4b61-9957-a83985674d1c","block_type":"box","text":"Failure by the syndicate agent to fulfill its obligations may delay or adversely affect receipt of payment by the Fund.","page_number":55,"box":{"x":70,"y":75,"width":816,"height":11}},{"id":"c0fdfafd-66a1-4db8-bf56-069aed1b25a5","block_type":"box","text":"The Loans in which the Fund may invest are subject to the risk of loss of principal and income. Although","page_number":55,"box":{"x":101,"y":98,"width":740,"height":11}},{"id":"dfed877d-f2f7-40b5-87c8-036c4d0e2ac5","block_type":"box","text":"borrowers frequently provide collateral to secure repayment of these obligations they do not always do so. If they do","page_number":55,"box":{"x":69,"y":113,"width":827,"height":11}},{"id":"fd1673b5-957f-4dee-b14e-37b984c6c04c","block_type":"box","text":"provide collateral, the value of the collateral may not completely cover the borrower’s obligations at the time of a","page_number":55,"box":{"x":70,"y":128,"width":802,"height":11}},{"id":"398834ab-ccd0-4947-b125-66eb29380141","block_type":"box","text":"default. If a borrower files for protection from its creditors under the U.S. bankruptcy laws, these laws may limit a","page_number":55,"box":{"x":69,"y":143,"width":808,"height":11}},{"id":"56af3bf9-5779-4ce7-be1e-2ab8ba2b8688","block_type":"box","text":"Fund’s rights to its collateral. In addition, the value of collateral may erode during a bankruptcy case. In the event of","page_number":55,"box":{"x":70,"y":158,"width":827,"height":11}},{"id":"4f837f03-33fa-49f4-87d4-5a6a648d1d1e","block_type":"box","text":"a bankruptcy, the holder of a Loan may not recover its principal, may experience a long delay in recovering its","page_number":55,"box":{"x":69,"y":173,"width":777,"height":11}},{"id":"cc34249f-82dc-42d2-9083-a38a490f4709","block_type":"box","text":"investment and may not receive interest during the delay.","page_number":55,"box":{"x":70,"y":188,"width":406,"height":12}},{"id":"b2db8e4e-2c6c-49c6-acb0-cda8fd8ab44e","block_type":"box","text":"Transactions in corporate loans may settle on a delayed basis. As a result, the proceeds from the sale of","page_number":55,"box":{"x":101,"y":211,"width":752,"height":11}},{"id":"ec12b353-c583-4da4-85a1-45b35c4325f8","block_type":"box","text":"corporate loans may not be readily available to make additional investments or to meet a Fund’s redemption","page_number":55,"box":{"x":69,"y":226,"width":773,"height":11}},{"id":"def05f4a-ed1a-48af-a457-deb372f7e469","block_type":"box","text":"obligations. To the extent the extended settlement process gives rise to shor t-term liquidity needs, a Fund may hold","page_number":55,"box":{"x":69,"y":241,"width":824,"height":11}},{"id":"3a435770-a418-432e-995e-08d96c799a84","block_type":"box","text":"additional cash, sell investments or temporarily borrow from banks and other lenders.","page_number":55,"box":{"x":69,"y":256,"width":610,"height":11}},{"id":"b4c581a7-9d53-4435-a6eb-23b2e95970e4","block_type":"box","text":"In cer tain circumstances, Loans may not be deemed to be securities under cer tain federal securities laws.","page_number":55,"box":{"x":102,"y":279,"width":759,"height":11}},{"id":"fe246db9-4dc6-4ea4-a5f4-5ddbf04ccf0d","block_type":"box","text":"Therefore, in the event of fraud or misrepresentation by a borrower or an arranger, Lenders and purchasers of","page_number":55,"box":{"x":68,"y":294,"width":784,"height":11}},{"id":"bdbb1ace-6bd9-4f61-af15-649b360374e9","block_type":"box","text":"interests in Loans, such as the Funds, may not have the protection of the anti-fraud provisions of the federal","page_number":55,"box":{"x":70,"y":309,"width":772,"height":11}},{"id":"7268d7a2-c04e-40df-aa4a-3400be7de23d","block_type":"box","text":"securities laws as would otherwise be available for bonds or stocks. Instead, in such cases, par ties generally would","page_number":55,"box":{"x":69,"y":324,"width":827,"height":12}},{"id":"16570d14-bfa5-4770-afeb-6966a656a53e","block_type":"box","text":"rely on the contractual provisions in the Loan agreement itself and common-law fraud protections under applicable","page_number":55,"box":{"x":69,"y":339,"width":815,"height":12}},{"id":"e39f9e2b-6dd7-488a-98b7-bcfa8213fe06","block_type":"box","text":"state law.","page_number":55,"box":{"x":69,"y":355,"width":67,"height":9}},{"id":"8b1a7b94-ad77-43bd-98b5-2c4a80bf251c","block_type":"box","text":"Direct Lending.","page_number":55,"box":{"x":102,"y":377,"width":105,"height":12}},{"id":"ffb64ca9-694f-4822-94c9-ac484dfb8940","block_type":"box","text":"The Fund may act as the originator for direct loans and engage in direct lending. Direct loans","page_number":55,"box":{"x":213,"y":377,"width":660,"height":12}},{"id":"27888157-dd23-4cca-bf5f-1570f9c8fa14","block_type":"box","text":"between the Fund and a borrower may not be administered by an underwriter or agent bank. The Fund may provide","page_number":55,"box":{"x":69,"y":393,"width":817,"height":11}},{"id":"19e35e1d-f90c-4dcf-af3c-dae12db2eebd","block_type":"box","text":"financing to commercial borrowers directly or through companies acquired (or created) and owned by or otherwise","page_number":55,"box":{"x":68,"y":407,"width":811,"height":12}},{"id":"76c127dd-1f5d-4bdc-b118-9c0012eb7646","block_type":"box","text":"affiliated with the Fund. The terms of the direct loans are negotiated with borrowers in private transactions.","page_number":55,"box":{"x":69,"y":423,"width":764,"height":11}},{"id":"78ab50c9-b1ec-4c81-96f8-335eb5ed6f8c","block_type":"box","text":"Fur thermore, a direct loan may be secured or unsecured.","page_number":55,"box":{"x":70,"y":438,"width":405,"height":11}},{"id":"46edbeb3-5e7d-431e-8d15-1160c37dc8b9","block_type":"box","text":"In determining whether to make a direct loan, the Fund will rely primarily upon the creditwor thiness of the","page_number":55,"box":{"x":102,"y":460,"width":750,"height":12}},{"id":"44158990-d5fa-4230-b139-857b840f924e","block_type":"box","text":"borrower and/or any collateral for payment of interest and repayment of principal. The risks associated with direct","page_number":55,"box":{"x":69,"y":475,"width":813,"height":12}},{"id":"aa90fed6-1b85-49ba-b0a9-c578d8916166","block_type":"box","text":"loans are substantially similar to those associated with investing in corporate loans. In making a direct loan, the Fund","page_number":55,"box":{"x":70,"y":491,"width":838,"height":11}},{"id":"b50da388-04c5-45dd-9e17-8ca386c86956","block_type":"box","text":"is exposed to the risk that the borrower may default or become insolvent and, consequently, that the Fund will lose","page_number":55,"box":{"x":70,"y":506,"width":818,"height":11}},{"id":"6ca5ef0a-16b5-447d-9186-08dce369686f","block_type":"box","text":"money on the loan. Fur thermore, direct loans may subject the Fund to liquidity and interest rate risk and cer tain","page_number":55,"box":{"x":69,"y":521,"width":798,"height":11}},{"id":"e1203b60-c97e-4da6-bc07-e0b9efcdf7b9","block_type":"box","text":"direct loans may be deemed illiquid. Direct loans are not publicly traded and may not have a secondary market. The","page_number":55,"box":{"x":69,"y":536,"width":825,"height":11}},{"id":"e4daf371-c768-498b-96a2-2746afc4bbde","block_type":"box","text":"lack of a secondary market for direct loans may have an adverse impact on the ability of the Fund to dispose of a","page_number":55,"box":{"x":70,"y":551,"width":807,"height":11}},{"id":"1ee99f7a-ac56-4f4e-b731-10c582b75442","block_type":"box","text":"direct loan and/or to value the direct loan.","page_number":55,"box":{"x":69,"y":566,"width":301,"height":11}},{"id":"45caab1f-b381-4b98-9636-acb01a8a130a","block_type":"box","text":"When engaging in direct lending, the Fund’s per formance may depend, in par t, on the ability of the Fund to","page_number":55,"box":{"x":101,"y":589,"width":762,"height":11}},{"id":"0c035ffb-a987-491f-af65-7a731fbfa5e5","block_type":"box","text":"originate loans on advantageous terms. In originating loans, the Fund will compete with a broad spectrum of lenders.","page_number":55,"box":{"x":69,"y":604,"width":833,"height":11}},{"id":"78c5be17-dd05-448f-9b9b-3b92736acb2b","block_type":"box","text":"Increased competition for, or a diminishment in the available supply of, qualifying loans could result in lower yields on","page_number":55,"box":{"x":70,"y":619,"width":836,"height":11}},{"id":"925fcfc8-0add-433a-83b3-b7cd17516b81","block_type":"box","text":"such loans, which could reduce Fund per formance.","page_number":55,"box":{"x":69,"y":634,"width":362,"height":11}},{"id":"e60a6d71-43dc-46ad-bc5d-2ab6eaa5f816","block_type":"box","text":"As par t of its lending activities, the Fund may originate loans to companies that are experiencing significant","page_number":55,"box":{"x":101,"y":657,"width":767,"height":11}},{"id":"32ffe8b7-edc4-4f8d-95e1-39578f2aa671","block_type":"box","text":"financial or business difficulties, including companies involved in bankruptcy or other reorganization and liquidation","page_number":55,"box":{"x":68,"y":672,"width":821,"height":11}},{"id":"68e820a1-cd5e-46ab-a257-9c69c61e0464","block_type":"box","text":"proceedings. Although the terms of such financing may result in significant financial returns to the Fund, they involve","page_number":55,"box":{"x":70,"y":687,"width":830,"height":11}},{"id":"7f48fa1b-621b-4736-ba95-9e2d02a2369c","block_type":"box","text":"a substantial degree of risk. The level of analytical sophistication, both financial and legal, necessary for successful","page_number":55,"box":{"x":69,"y":702,"width":826,"height":12}},{"id":"dcf33266-574f-4ca9-b329-07b2b78055c3","block_type":"box","text":"financing to companies experiencing significant business and financial difficulties is unusually high.","page_number":55,"box":{"x":68,"y":717,"width":709,"height":12}},{"id":"22c64932-056b-4376-84e5-91b61ab10cb9","block_type":"box","text":"Credit Linked Securities.","page_number":55,"box":{"x":102,"y":740,"width":179,"height":9}},{"id":"b07fb748-c3d1-4d80-824a-5bf6003fe467","block_type":"box","text":"Among the income producing securities in which a Fund may invest are credit linked","page_number":55,"box":{"x":287,"y":740,"width":596,"height":11}},{"id":"f01fe781-0f19-4f9c-8c38-26725ad7ddfe","block_type":"box","text":"securities, which are issued by a limited purpose trust or other vehicle that, in turn, invests in a derivative instrument","page_number":55,"box":{"x":69,"y":755,"width":837,"height":11}},{"id":"3c62c720-7628-4774-a803-3974ab2ced8a","block_type":"box","text":"or basket of derivative instruments, such as credit default swaps, interest rate swaps and other securities, in order","page_number":55,"box":{"x":69,"y":770,"width":823,"height":11}},{"id":"dfb77603-82a3-48b0-ba5e-06759173dea6","block_type":"box","text":"to provide exposure to cer tain fixed-income markets. For instance, a Fund may invest in credit linked securities as a","page_number":55,"box":{"x":68,"y":785,"width":827,"height":12}},{"id":"0f5d2b2a-bc87-4ca0-a8eb-69c70fc286e4","block_type":"box","text":"cash management tool in order to gain exposure to a cer tain market and/or to remain fully invested when more","page_number":55,"box":{"x":69,"y":801,"width":795,"height":11}},{"id":"b183db9c-5c8d-44d3-8af8-57f48ba5e57d","block_type":"box","text":"traditional income producing securities are not available.","page_number":55,"box":{"x":68,"y":816,"width":404,"height":11}},{"id":"9019db5e-ca50-4765-8680-f14d24b150bb","block_type":"box","text":"Like an investment in a bond, investments in these credit linked securities represent the right to receive periodic","page_number":55,"box":{"x":102,"y":839,"width":804,"height":11}},{"id":"067e8e62-f899-434d-ac6f-7f126abd9c7e","block_type":"box","text":"income payments (in the form of distributions) and payment of principal at the end of the term of the security.","page_number":55,"box":{"x":70,"y":853,"width":780,"height":12}},{"id":"d4c4de1d-bb7e-4fd6-b2f5-09359f70f67e","block_type":"box","text":"However, these payments are conditioned on the issuer’s receipt of payments from, and the issuer’s potential","page_number":55,"box":{"x":102,"y":876,"width":785,"height":11}},{"id":"ee9e308e-2c29-49ac-90d1-f42514f54ffb","block_type":"box","text":"obligations to, the counterpar ties to the derivative instruments and other securities in which the issuer invests. For","page_number":55,"box":{"x":69,"y":891,"width":821,"height":12}},{"id":"1a63f553-1444-40e5-9aa8-1a8c5d418eb3","block_type":"box","text":"instance, the issuer may sell one or more credit default swaps, under which the issuer would receive a stream of","page_number":55,"box":{"x":70,"y":906,"width":806,"height":12}},{"id":"fbd96fa4-30a0-4043-a168-2f1f4fa2cdb4","block_type":"box","text":"II-8","page_number":55,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"1556c729-638f-4162-a4c8-18690e0b2c53","block_type":"box","text":"NM1026U-6033063-55/246","page_number":55,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"81c1c43a-80c3-47ab-8e22-9c4eabae937b","block_type":"box","text":"payments over the term of the swap agreements provided that no event of default has occurred with respect to the","page_number":56,"box":{"x":70,"y":45,"width":819,"height":11}},{"id":"4fa23dc5-12e7-4942-80b9-b21c1f46bf8e","block_type":"box","text":"referenced debt obligation upon which the swap is based. If a default occurs, the stream of payments may stop and","page_number":56,"box":{"x":69,"y":60,"width":826,"height":11}},{"id":"5078b461-efb7-4a93-ac87-f8f740d0f2ba","block_type":"box","text":"the issuer would be obligated to pay the counterpar ty the par (or other agreed upon value) of the referenced debt","page_number":56,"box":{"x":68,"y":75,"width":807,"height":11}},{"id":"88ee55f9-8747-4b57-aa74-7e5715d4b12f","block_type":"box","text":"obligation. This, in turn, would reduce the amount of income and principal that a Fund would receive. A Fund’s","page_number":56,"box":{"x":69,"y":90,"width":783,"height":11}},{"id":"35000fe6-f75a-4b64-bc11-819129a07619","block_type":"box","text":"investments in these instruments are indirectly subject to the risks associated with derivative instruments, including,","page_number":56,"box":{"x":70,"y":105,"width":833,"height":11}},{"id":"bf3acc20-f7b3-470c-9469-c2369ae40a27","block_type":"box","text":"among others, credit risk, default or similar event risk, counterpar ty risk, interest rate risk, leverage risk and","page_number":56,"box":{"x":69,"y":120,"width":771,"height":12}},{"id":"c4789c3a-fe4d-4a68-bc91-62dd36ce26f2","block_type":"box","text":"management risk. It is also expected that the securities will be exempt from registration under the Securities Act.","page_number":56,"box":{"x":69,"y":135,"width":808,"height":12}},{"id":"06c394f7-701a-42cf-81cb-c15cc14211e9","block_type":"box","text":"Accordingly, there may be no established trading market for the securities and they may constitute illiquid","page_number":56,"box":{"x":68,"y":150,"width":752,"height":12}},{"id":"282c527f-764b-4379-acce-1974eeae3ebf","block_type":"box","text":"investments.","page_number":56,"box":{"x":70,"y":166,"width":89,"height":9}},{"id":"77949dbe-85e1-45cc-a256-2448a035bb9c","block_type":"box","text":"Debt Securities.","page_number":56,"box":{"x":102,"y":188,"width":116,"height":9}},{"id":"7ab1990a-5aed-41c9-933d-16da81ab05c6","block_type":"box","text":"Debt securities, such as bonds, involve credit risk. This is the risk that the issuer will not make","page_number":56,"box":{"x":225,"y":188,"width":677,"height":11}},{"id":"266bac85-88c5-4f1b-909c-eae93304e15f","block_type":"box","text":"timely payments of principal and interest. The degree of credit risk depends on the issuer’s financial condition and on","page_number":56,"box":{"x":68,"y":203,"width":839,"height":12}},{"id":"a6591d42-a272-42ec-8be4-74e2d6d8965a","block_type":"box","text":"the terms of the debt securities. Changes in an issuer’s credit rating or the market’s perception of an issuer’s","page_number":56,"box":{"x":68,"y":218,"width":787,"height":12}},{"id":"d4b7e8aa-0976-4e60-8dc1-bcde6c8cd432","block_type":"box","text":"creditwor thiness may also affect the value of a Fund’s investment in that issuer. Credit risk is reduced to the extent","page_number":56,"box":{"x":69,"y":234,"width":828,"height":11}},{"id":"0c80f6b3-9c05-4a3a-8644-d7966665a524","block_type":"box","text":"a Fund limits its debt investments to U.S. Government Securities.","page_number":56,"box":{"x":69,"y":249,"width":466,"height":9}},{"id":"d9da777f-8ba4-473e-8cf8-a97ebbd03903","block_type":"box","text":"All debt securities, however, are subject to interest rate risk. This is the risk that the value of the security may","page_number":56,"box":{"x":101,"y":271,"width":784,"height":12}},{"id":"171f4adb-6cb9-41f9-8192-bff891f9cb8d","block_type":"box","text":"fall when interest rates rise. If interest rates move sharply in a manner not anticipated by Fund management, a","page_number":56,"box":{"x":68,"y":286,"width":792,"height":12}},{"id":"e572c85b-67f0-4df6-ab6d-5dd697fa0e0e","block_type":"box","text":"Fund’s investments in debt securities could be adversely affected and the Fund could lose money. In general, the","page_number":56,"box":{"x":70,"y":302,"width":806,"height":11}},{"id":"b8353469-7d9b-4d48-ac2c-d1748041f9c4","block_type":"box","text":"market price of debt securities with longer maturities will go up or down more in response to changes in interest","page_number":56,"box":{"x":69,"y":317,"width":800,"height":11}},{"id":"436b8d67-91d5-4411-80da-1eff5d2a9848","block_type":"box","text":"rates than will the market price of shor ter-term debt securities.","page_number":56,"box":{"x":69,"y":332,"width":448,"height":11}},{"id":"2541d62f-3263-4bcd-bff1-6dda1c2c4b1a","block_type":"box","text":"During periods of rising interest rates, the average life of cer tain fixed-income securities is extended because of","page_number":56,"box":{"x":102,"y":355,"width":798,"height":11}},{"id":"d61c8457-97b1-4e64-a88a-986f33e1362f","block_type":"box","text":"slower than expected principal payments. This may lock in a below-market interest rate and extend the duration of","page_number":56,"box":{"x":69,"y":370,"width":813,"height":11}},{"id":"306a450e-6b1c-433a-a028-0fda0ebe0d1b","block_type":"box","text":"these fixed-income securities, especially mor tgage-related securities, making them more sensitive to changes in","page_number":56,"box":{"x":68,"y":385,"width":801,"height":11}},{"id":"2295a13f-431b-41c0-93b0-74fa73a252ef","block_type":"box","text":"interest rates. As a result, in a period of rising interest rates, these securities may exhibit additional volatility and","page_number":56,"box":{"x":70,"y":400,"width":806,"height":11}},{"id":"e386ceae-4d2f-4a83-adf8-a55800e698ea","block_type":"box","text":"lose value. This is known as extension risk.","page_number":56,"box":{"x":70,"y":415,"width":307,"height":9}},{"id":"e04bfb1d-2eb9-4acd-a5d1-8d60b9343932","block_type":"box","text":"The value of fixed-income securities in the Funds can be expected to vary inversely with changes in prevailing","page_number":56,"box":{"x":101,"y":438,"width":778,"height":11}},{"id":"52bbcc71-4810-4b6c-9999-4d7939445a44","block_type":"box","text":"interest rates. Fixed-income securities with longer maturities, which tend to produce higher yields, are subject to","page_number":56,"box":{"x":70,"y":453,"width":798,"height":11}},{"id":"3bba0e5a-356c-48c9-88de-483aa84c7ce7","block_type":"box","text":"potentially greater capital appreciation and depreciation than securities with shor ter maturities. The Funds are not","page_number":56,"box":{"x":70,"y":468,"width":812,"height":11}},{"id":"1cb5eb1a-d8c0-43c3-aac8-0974bad145dc","block_type":"box","text":"restricted to any maximum or minimum time to maturity in purchasing individual por tfolio securities, and the average","page_number":56,"box":{"x":69,"y":483,"width":831,"height":11}},{"id":"32804ecc-0614-49fb-994a-b3d6984937cd","block_type":"box","text":"maturity of a Fund’s assets will vary.","page_number":56,"box":{"x":69,"y":498,"width":259,"height":11}},{"id":"7ff3d07f-96bf-4b8d-8254-99667f9c5707","block_type":"box","text":"Floating and Variable Rate Securities","page_number":56,"box":{"x":102,"y":521,"width":260,"height":11}},{"id":"fce4b561-e2f3-4919-9a80-75f790ea2751","block_type":"box","text":". Cer tain Funds may invest in debt instruments that pay a variable coupon","page_number":56,"box":{"x":364,"y":521,"width":526,"height":11}},{"id":"5df8c0b5-1065-499b-a76d-b6376ac9154e","block_type":"box","text":"rate. Securities with floating or variable interest rates can be less sensitive to interest rate changes than securities","page_number":56,"box":{"x":69,"y":536,"width":821,"height":11}},{"id":"29c00a11-6469-4c18-a49a-bcf6c699ef33","block_type":"box","text":"with fixed interest rates, but may decline in value if their interest rates do not rise as much, or as quickly, as interest","page_number":56,"box":{"x":68,"y":551,"width":834,"height":11}},{"id":"f6655fef-a86b-44bf-8640-c52c4ae7c40b","block_type":"box","text":"rates in general. Conversely, floating rate securities will not generally increase in value if interest rates decline. The","page_number":56,"box":{"x":69,"y":566,"width":820,"height":11}},{"id":"2155a7ec-0101-4066-899c-bc8f60497dd0","block_type":"box","text":"impact of interest rate changes on floating rate investments is typically mitigated by the periodic interest rate reset of","page_number":56,"box":{"x":70,"y":581,"width":838,"height":12}},{"id":"8360b7a7-4af6-4cf7-a5be-a31666705fdb","block_type":"box","text":"the investments. Benchmark interest rates used for floating and variable rate securities may not accurately track","page_number":56,"box":{"x":68,"y":596,"width":804,"height":12}},{"id":"d30e17b0-8a40-4e0f-a5b2-cffe46cd86b3","block_type":"box","text":"market interest rates.","page_number":56,"box":{"x":69,"y":612,"width":153,"height":9}},{"id":"c3376c29-9a7a-4b02-b570-9bfc1b5b57d5","block_type":"box","text":"Inflation-Indexed Bonds.","page_number":56,"box":{"x":102,"y":634,"width":169,"height":9}},{"id":"6b1626b4-d8b8-4554-b87e-faff64db722c","block_type":"box","text":"Cer tain Funds may invest in inflation-indexed bonds, which are fixed-income securities or","page_number":56,"box":{"x":278,"y":634,"width":632,"height":11}},{"id":"e3b24237-96e6-47d5-acea-4bfad378d86a","block_type":"box","text":"other instruments whose principal value is periodically adjusted according to the rate of inflation. Two structures are","page_number":56,"box":{"x":69,"y":649,"width":828,"height":12}},{"id":"09ab3448-774a-4405-9f00-d39a24cf9cd4","block_type":"box","text":"common. The U.S. Treasury and some other issuers use a structure that accrues inflation into the principal value of","page_number":56,"box":{"x":69,"y":664,"width":827,"height":12}},{"id":"e3065590-c745-4b5d-938e-98f00f84a8c1","block_type":"box","text":"the bond. Most other issuers pay out the Consumer Price Index (“CPI”) accruals as par t of a semi-annual coupon.","page_number":56,"box":{"x":68,"y":680,"width":810,"height":11}},{"id":"13783f37-5953-42c2-b9aa-7e7f15bb7359","block_type":"box","text":"Inflation-indexed securities issued by the U.S. Treasury have maturities of five, ten or thir ty years, although it is","page_number":56,"box":{"x":102,"y":702,"width":792,"height":12}},{"id":"169258a3-aaf8-4eb7-ad92-4e4140643f8c","block_type":"box","text":"possible that securities with other maturities will be issued in the future. The U.S. Treasury securities pay interest on","page_number":56,"box":{"x":70,"y":717,"width":833,"height":12}},{"id":"5076f8ff-142d-4e0b-9170-ed04c96a8779","block_type":"box","text":"a semi-annual basis, equal to a fixed percentage of the inflation-adjusted principal amount. For example, if a Fund","page_number":56,"box":{"x":69,"y":732,"width":810,"height":12}},{"id":"ecb22a94-ab31-4107-a46a-5b3b9c4791fe","block_type":"box","text":"purchased an inflation-indexed bond with a par value of $1,000 and a 3% real rate of return coupon (payable 1.5%","page_number":56,"box":{"x":70,"y":747,"width":814,"height":12}},{"id":"cd7263a1-52ab-49c9-b32d-dc3fcb5c891d","block_type":"box","text":"semi-annually), and inflation over the first six months was 1%, the mid-year par value of the bond would be $1,010","page_number":56,"box":{"x":69,"y":762,"width":816,"height":12}},{"id":"3d586946-c8f2-4602-97de-f2cc0284aa21","block_type":"box","text":"and the first semi-annual interest payment would be $15.15 ($1,010 times 1.5%). If inflation during the second half","page_number":56,"box":{"x":69,"y":777,"width":828,"height":12}},{"id":"82aec0a6-843c-472a-b572-1873778abc1f","block_type":"box","text":"of the year resulted in the whole year’s inflation equaling 3%, the end-of-year par value of the bond would be $1,030","page_number":56,"box":{"x":69,"y":792,"width":828,"height":12}},{"id":"2c44b3a2-8a08-403c-a2c4-051485b7e191","block_type":"box","text":"and the second semi-annual interest payment would be $15.45 ($1,030 times 1.5%).","page_number":56,"box":{"x":69,"y":807,"width":610,"height":12}},{"id":"422bbefa-a269-4ea5-a23c-66c88c4cb18a","block_type":"box","text":"If the periodic adjustment rate measuring inflation falls, the principal value of inflation-indexed bonds will be","page_number":56,"box":{"x":102,"y":831,"width":767,"height":11}},{"id":"b21895e9-c70f-4944-8ae5-529798aa6ad9","block_type":"box","text":"adjusted downward, and, consequently, the interest payable on these securities (calculated with respect to a smaller","page_number":56,"box":{"x":69,"y":846,"width":833,"height":11}},{"id":"d6a8138d-7245-4896-b950-115494be5863","block_type":"box","text":"principal amount) will be reduced. Repayment of the original bond principal upon maturity (as adjusted for inflation) is","page_number":56,"box":{"x":70,"y":861,"width":834,"height":11}},{"id":"c06f2f5d-bb67-4738-9b26-be0231d9c2c2","block_type":"box","text":"guaranteed in the case of U.S. Treasury inflation-indexed bonds, even during a period of deflation. However, the","page_number":56,"box":{"x":68,"y":876,"width":795,"height":11}},{"id":"70559974-b66c-4718-9eec-76a62d1b50fd","block_type":"box","text":"current market value of the bonds is not guaranteed, and will fluctuate. Cer tain Funds may also invest in other","page_number":56,"box":{"x":69,"y":891,"width":788,"height":12}},{"id":"6186d211-1f83-4689-9c67-3baf79402f81","block_type":"box","text":"inflation related bonds which may or may not provide a similar guarantee. If a guarantee of principal is not provided,","page_number":56,"box":{"x":70,"y":906,"width":823,"height":12}},{"id":"da72b74c-a2da-42b9-9fc7-39595b8a6f2a","block_type":"box","text":"II-9","page_number":56,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"ec4008b3-e858-487d-8b2d-5791d571947c","block_type":"box","text":"NM1026U-6033063-56/246","page_number":56,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"06d0824f-81b7-4b5e-a485-17565ff4dcb4","block_type":"box","text":"the adjusted principal value of the bond repaid at maturity may be less than the original principal. In addition, if the","page_number":57,"box":{"x":68,"y":45,"width":821,"height":11}},{"id":"4a926f19-3a01-4001-a701-4646d7bba661","block_type":"box","text":"Fund purchases inflation-indexed bonds offered by foreign issuers, the rate of inflation measured by the foreign","page_number":57,"box":{"x":70,"y":60,"width":792,"height":11}},{"id":"889e6324-ecdf-47bf-aad1-35c14643fccb","block_type":"box","text":"inflation index may not be correlated to the rate of inflation in the United States.","page_number":57,"box":{"x":70,"y":75,"width":570,"height":11}},{"id":"d582f216-b75a-46f1-94ba-6b627c66821e","block_type":"box","text":"The value of inflation-indexed bonds is expected to change in response to changes in real interest rates. Real","page_number":57,"box":{"x":101,"y":98,"width":780,"height":11}},{"id":"e867c4d4-e352-4c7c-83cf-a801e70f7d10","block_type":"box","text":"interest rates, in turn, are tied to the relationship between nominal interest rates and the rate of inflation. Therefore,","page_number":57,"box":{"x":70,"y":113,"width":831,"height":11}},{"id":"21dcb0d4-4bdf-4dff-ac3d-0f724b142b1a","block_type":"box","text":"if inflation were to rise at a faster rate than nominal interest rates, real interest rates might decline, leading to an","page_number":57,"box":{"x":70,"y":128,"width":808,"height":11}},{"id":"94c3787e-481a-459a-a61c-25b4d12412e8","block_type":"box","text":"increase in value of inflation-indexed bonds. In contrast, if nominal interest rates increased at a faster rate than","page_number":57,"box":{"x":70,"y":143,"width":796,"height":10}},{"id":"24d8c6f0-7aba-4ac7-afa7-a6d33494000b","block_type":"box","text":"inflation, real interest rates might rise, leading to a decrease in value of inflation-indexed bonds. There can be no","page_number":57,"box":{"x":70,"y":158,"width":805,"height":11}},{"id":"c117d0b2-08ea-4a5f-9447-2f9d3b6a3509","block_type":"box","text":"assurance, however, that the value of inflation-indexed bonds will be directly correlated to changes in interest rates.","page_number":57,"box":{"x":69,"y":173,"width":824,"height":11}},{"id":"c030c050-3c3b-4f1b-bcfe-7366861fe6d6","block_type":"box","text":"While these securities are expected to be protected from long-term inflationary trends, shor t-term increases in","page_number":57,"box":{"x":101,"y":196,"width":788,"height":11}},{"id":"b7a175fc-9932-4191-ae8f-6d0f70fe0848","block_type":"box","text":"inflation may lead to a decline in value. If interest rates rise due to reasons other than inflation (for example, due to","page_number":57,"box":{"x":70,"y":211,"width":825,"height":11}},{"id":"d7242a79-4d07-4a28-8a09-fc829365a605","block_type":"box","text":"changes in currency exchange rates), investors in these securities may not be protected to the extent that the","page_number":57,"box":{"x":69,"y":226,"width":784,"height":11}},{"id":"c5334635-3c2d-4ff4-ab07-c1f009e0c1e0","block_type":"box","text":"increase is not reflected in the bond’s inflation measure.","page_number":57,"box":{"x":70,"y":241,"width":403,"height":9}},{"id":"1924dff1-a962-40bd-a79f-b5df522b6c0d","block_type":"box","text":"In general, the measure used to determine the periodic adjustment of U.S. inflation-indexed bonds is the","page_number":57,"box":{"x":102,"y":264,"width":746,"height":11}},{"id":"8c725913-32f4-42a8-9871-2411de0bb5df","block_type":"box","text":"Consumer Price Index for Urban Consumers (“CPI-U”), which is calculated monthly by the U.S. Bureau of Labor","page_number":57,"box":{"x":69,"y":279,"width":786,"height":11}},{"id":"032e5ecd-ec15-4411-b450-487a863e04c4","block_type":"box","text":"Statistics. The CPI-U is a measurement of changes in the cost of living, made up of components such as housing,","page_number":57,"box":{"x":69,"y":294,"width":810,"height":11}},{"id":"06e4ab31-a871-4721-9e22-a8085831ed4e","block_type":"box","text":"food, transpor tation and energy. Inflation-indexed bonds issued by a foreign government are generally adjusted to","page_number":57,"box":{"x":68,"y":309,"width":809,"height":11}},{"id":"caa834f2-f367-4335-9b89-979553da38a6","block_type":"box","text":"reflect a comparable inflation index, calculated by that government. There can be no assurance that the CPI-U or any","page_number":57,"box":{"x":69,"y":324,"width":830,"height":12}},{"id":"40e738b2-7b31-438c-b204-c6d8fddb09ad","block_type":"box","text":"foreign inflation index will accurately measure the real rate of inflation in the prices of goods and services. Moreover,","page_number":57,"box":{"x":68,"y":339,"width":833,"height":12}},{"id":"99802fab-baf8-4a95-a392-1e2038a28f0f","block_type":"box","text":"there can be no assurance that the rate of inflation in a foreign country will be correlated to the rate of inflation in the","page_number":57,"box":{"x":68,"y":355,"width":840,"height":11}},{"id":"4df69607-e0b2-4b76-a60e-0935004a5a91","block_type":"box","text":"United States.","page_number":57,"box":{"x":70,"y":370,"width":99,"height":9}},{"id":"735a6089-099b-460f-8656-9548aeb1cb92","block_type":"box","text":"Any increase in the principal amount of an inflation-indexed bond will be considered taxable ordinary income,","page_number":57,"box":{"x":101,"y":392,"width":774,"height":12}},{"id":"3bec7876-8c10-4a1a-a2fb-f0353a44e55a","block_type":"box","text":"even though investors do not receive their principal until maturity.","page_number":57,"box":{"x":69,"y":408,"width":464,"height":11}},{"id":"258cd458-5553-47fe-8a19-2ad556017609","block_type":"box","text":"Investment Grade Debt Obligations.","page_number":57,"box":{"x":102,"y":430,"width":252,"height":11}},{"id":"55403e77-bde8-4c97-b90d-7479997419cc","block_type":"box","text":"Cer tain Funds may invest in “investment grade securities,” which are","page_number":57,"box":{"x":360,"y":430,"width":493,"height":11}},{"id":"94733a38-5dc2-4113-b1d1-6da3c9c85fd2","block_type":"box","text":"securities rated in the four highest rating categories of an NRSRO or deemed to be of equivalent quality by a Fund’s","page_number":57,"box":{"x":69,"y":445,"width":823,"height":12}},{"id":"f62a66a4-9f55-4662-b1c2-7bdd15a7a098","block_type":"box","text":"Manager. Cer tain Funds may invest in debt securities rated Aaa by Moody’s or AAA by S&P. It should be noted that","page_number":57,"box":{"x":70,"y":460,"width":815,"height":12}},{"id":"047c3c21-ed5f-4ae5-9466-d7c6ef1a323d","block_type":"box","text":"debt obligations rated in the lowest of the top four ratings (","page_number":57,"box":{"x":69,"y":475,"width":420,"height":12}},{"id":"fa3682ef-8bba-487f-88a5-b5eeac0304b5","block_type":"box","text":"i.e.","page_number":57,"box":{"x":492,"y":476,"width":20,"height":8}},{"id":"cb19ceb9-86a1-40ae-b1c6-5b0548f1ce47","block_type":"box","text":", “Baa” by Moody’s or “BBB” by S&P) are considered","page_number":57,"box":{"x":514,"y":476,"width":377,"height":11}},{"id":"cb9d8e8a-52f9-4777-9766-52430c5a03b6","block_type":"box","text":"to have some speculative characteristics and are more sensitive to economic change than higher rated securities. If","page_number":57,"box":{"x":68,"y":491,"width":829,"height":11}},{"id":"ccc19bcb-78de-47e1-9974-9d58f0e3a235","block_type":"box","text":"an investment grade security of a Fund is subsequently downgraded below investment grade, the Fund’s Manager will","page_number":57,"box":{"x":69,"y":506,"width":836,"height":11}},{"id":"fb8368f3-cd14-4d73-8016-386904cefbf0","block_type":"box","text":"consider such an event in determining whether the Fund should continue to hold the security. Subject to its","page_number":57,"box":{"x":69,"y":521,"width":763,"height":11}},{"id":"3e9509fd-ff5a-496a-ab1d-3718a256f394","block_type":"box","text":"investment strategies, there is no limit on the amount of such downgraded securities a Fund may hold.","page_number":57,"box":{"x":70,"y":536,"width":731,"height":11}},{"id":"754e6b0d-7e04-4087-8736-0f01d7bf22bd","block_type":"box","text":"See Appendix A to this SAI for a description of applicable securities ratings.","page_number":57,"box":{"x":102,"y":559,"width":536,"height":11}},{"id":"d6018cfa-81ea-41fe-b309-9f76dc402f0e","block_type":"box","text":"High Yield Investments (“Junk Bonds”).","page_number":57,"box":{"x":102,"y":582,"width":278,"height":11}},{"id":"ae72b6d4-db91-45c4-819c-b070bc10dd70","block_type":"box","text":"Non-investment grade or “high yield” fixed-income or conver tible securities commonly known to investors as","page_number":57,"box":{"x":102,"y":604,"width":767,"height":11}},{"id":"9db0c65d-f57c-4f9c-843a-45f0cf454b6a","block_type":"box","text":"“junk bonds” are debt securities that are rated below investment grade by the major rating agencies or are securities","page_number":57,"box":{"x":70,"y":619,"width":834,"height":11}},{"id":"ae6ff4f2-c534-42fd-a8aa-0203365250e5","block_type":"box","text":"that Fund management believes are of comparable quality. While generally providing greater income and oppor tunity","page_number":57,"box":{"x":68,"y":634,"width":828,"height":12}},{"id":"0fe86618-6676-450c-9de6-67da50bdaafd","block_type":"box","text":"for gain, non-investment grade debt securities may be subject to greater risks than securities which have higher credit","page_number":57,"box":{"x":68,"y":649,"width":841,"height":12}},{"id":"20a2bef5-ff17-4888-ae23-657719338b83","block_type":"box","text":"ratings, including a high risk of default, and their yields will fluctuate over time. High yield securities will generally be","page_number":57,"box":{"x":69,"y":664,"width":827,"height":12}},{"id":"ab66c33e-be4b-4821-a9e1-cbe9ae80001c","block_type":"box","text":"in the lower rating categories of recognized rating agencies (rated “Ba” or lower by Moody’s or “BB” or lower by S&P)","page_number":57,"box":{"x":70,"y":680,"width":830,"height":11}},{"id":"c764a412-86a8-482d-ac3e-292832838405","block_type":"box","text":"or will be non-rated. The credit rating of a high yield security does not necessarily address its market value risk, and","page_number":57,"box":{"x":69,"y":695,"width":824,"height":11}},{"id":"1a7d0f3a-7651-41a2-a2f4-efd1937dcf77","block_type":"box","text":"ratings may from time to time change, positively or negatively, to reflect developments regarding the issuer’s financial","page_number":57,"box":{"x":69,"y":710,"width":838,"height":11}},{"id":"e7cd60ef-6288-4d3e-bcb7-7601262c5c06","block_type":"box","text":"condition. High yield securities are considered to be speculative with respect to the capacity of the issuer to timely","page_number":57,"box":{"x":69,"y":725,"width":817,"height":11}},{"id":"accd0109-fe7f-486a-9930-c6a104f76dcc","block_type":"box","text":"repay principal and pay interest or dividends in accordance with the terms of the obligation and may have more credit","page_number":57,"box":{"x":69,"y":740,"width":837,"height":11}},{"id":"5ffcc935-c45e-4e5e-aef8-ba94a19ecadd","block_type":"box","text":"risk than higher rated securities.","page_number":57,"box":{"x":69,"y":755,"width":230,"height":11}},{"id":"e2f880ec-3735-4d8b-8fc3-d1bfeb9a1803","block_type":"box","text":"The major risks in junk bond investments include the following:","page_number":57,"box":{"x":101,"y":778,"width":447,"height":11}},{"id":"3da7b611-2836-404e-9ee7-a156dc9cfce9","block_type":"box","text":"•","page_number":57,"box":{"x":69,"y":801,"width":6,"height":4}},{"id":"3de3498f-21dd-4e03-b5fb-bef6e7e90ff9","block_type":"box","text":"Junk bonds may be issued by less creditwor thy companies. These securities are vulnerable to adverse changes","page_number":57,"box":{"x":101,"y":798,"width":796,"height":11}},{"id":"47884cb0-5775-4f88-99aa-d74581bc6812","block_type":"box","text":"in the issuer’s industry and to general economic conditions. Issuers of junk bonds may be unable to meet their","page_number":57,"box":{"x":102,"y":813,"width":792,"height":11}},{"id":"b7856454-adcb-4c23-815e-1c1f7b2aa780","block_type":"box","text":"interest or principal payment obligations because of an economic downturn, specific issuer developments or the","page_number":57,"box":{"x":102,"y":828,"width":799,"height":12}},{"id":"2216ebcd-9d77-42af-952e-0194e397b3e2","block_type":"box","text":"unavailability of additional financing.","page_number":57,"box":{"x":102,"y":843,"width":256,"height":12}},{"id":"d3bbc687-85f4-4737-af99-fdf2d394810d","block_type":"box","text":"•","page_number":57,"box":{"x":69,"y":866,"width":6,"height":5}},{"id":"48dbb425-436c-42ef-8282-d5dc17d391db","block_type":"box","text":"The issuers of junk bonds may have a larger amount of outstanding debt relative to their assets than issuers of","page_number":57,"box":{"x":101,"y":863,"width":797,"height":12}},{"id":"3cb21c73-8e09-4449-964c-eb26fccddf24","block_type":"box","text":"investment grade bonds. If the issuer experiences financial stress, it may be unable to meet its debt obligations.","page_number":57,"box":{"x":102,"y":879,"width":804,"height":11}},{"id":"789b08ee-8f8e-48e1-a8da-8a8369c7866c","block_type":"box","text":"The issuer’s ability to pay its debt obligations also may be lessened by specific issuer developments, or the","page_number":57,"box":{"x":101,"y":894,"width":769,"height":11}},{"id":"c435e55f-a8e7-4793-a2a1-2f232c077b77","block_type":"box","text":"II-10","page_number":57,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"7e243f54-a17a-426f-932d-60b68a95a96c","block_type":"box","text":"NM1026U-6033063-57/246","page_number":57,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"ffe12a7d-91dc-4b69-87c2-d0754cbdaf47","block_type":"box","text":"unavailability of additional financing. Issuers of high yield securities are often in the growth stage of their","page_number":58,"box":{"x":102,"y":45,"width":746,"height":11}},{"id":"ca0ad799-6228-49ae-8eae-ce0c5fcbcd5a","block_type":"box","text":"development and/or involved in a reorganization or takeover.","page_number":58,"box":{"x":101,"y":60,"width":432,"height":11}},{"id":"65a212d6-1153-4e77-b63e-bb5a42029a21","block_type":"box","text":"•","page_number":58,"box":{"x":69,"y":83,"width":6,"height":4}},{"id":"f42bfe67-0019-451e-8cb2-171b1563d26c","block_type":"box","text":"Junk bonds are frequently ranked junior to claims by other creditors. If the issuer cannot meet its obligations, the","page_number":58,"box":{"x":101,"y":80,"width":808,"height":11}},{"id":"afacbc99-7beb-4f3d-a09b-c29c89edfb11","block_type":"box","text":"senior obligations are generally paid off before the junior obligations, which will potentially limit a Fund’s ability","page_number":58,"box":{"x":102,"y":95,"width":789,"height":11}},{"id":"f80151aa-4f12-4c02-bc7f-454a8f08815c","block_type":"box","text":"to fully recover principal or to receive interest payments when senior securities are in default. Thus, investors in","page_number":58,"box":{"x":101,"y":110,"width":796,"height":11}},{"id":"07b7f4f8-b164-469a-8455-d772de8c27b8","block_type":"box","text":"high yield securities have a lower degree of protection with respect to principal and interest payments than do","page_number":58,"box":{"x":102,"y":125,"width":782,"height":12}},{"id":"d501d20d-4be8-4cdc-80ab-465f9dfb6853","block_type":"box","text":"investors in higher rated securities.","page_number":58,"box":{"x":102,"y":141,"width":249,"height":11}},{"id":"4947ed5c-a5ac-4fa1-b118-9ab6d83409de","block_type":"box","text":"•","page_number":58,"box":{"x":69,"y":163,"width":6,"height":5}},{"id":"75af0c59-1f81-4239-b40b-2d3c5e169804","block_type":"box","text":"Junk bonds frequently have redemption features that permit an issuer to repurchase the security from a Fund","page_number":58,"box":{"x":101,"y":161,"width":780,"height":11}},{"id":"31547f46-a8e1-4676-ac64-68054a99da3d","block_type":"box","text":"before it matures. If an issuer redeems the junk bonds, a Fund may have to invest the proceeds in bonds with","page_number":58,"box":{"x":102,"y":176,"width":784,"height":11}},{"id":"53852554-91f3-4fc6-9b45-0920df12956f","block_type":"box","text":"lower yields and may lose income.","page_number":58,"box":{"x":102,"y":191,"width":242,"height":11}},{"id":"142fa457-d864-4882-8085-2aa03145326a","block_type":"box","text":"•","page_number":58,"box":{"x":69,"y":214,"width":6,"height":4}},{"id":"0aa8c5de-4b4d-4b7c-976c-b3d20aa6842d","block_type":"box","text":"Prices of junk bonds are subject to extreme price fluctuations. Negative economic developments may have a","page_number":58,"box":{"x":102,"y":211,"width":772,"height":11}},{"id":"a8e5100d-9825-4247-93fa-a36597f3d7c8","block_type":"box","text":"greater impact on the prices of junk bonds than on those of other higher rated fixed-income securities.","page_number":58,"box":{"x":101,"y":226,"width":729,"height":11}},{"id":"bf12890b-9161-4041-afe1-caeff4540684","block_type":"box","text":"•","page_number":58,"box":{"x":69,"y":249,"width":6,"height":5}},{"id":"198b448b-a1b2-4b1d-849e-26869204bc92","block_type":"box","text":"Junk bonds may be less liquid than higher rated fixed-income securities even under normal economic conditions.","page_number":58,"box":{"x":101,"y":246,"width":802,"height":11}},{"id":"26d451a9-6ba4-4baa-a435-d14dc5a7c73e","block_type":"box","text":"Under cer tain economic and/or market conditions, a Fund may have difficulty disposing of cer tain high yield","page_number":58,"box":{"x":102,"y":261,"width":768,"height":12}},{"id":"7522bfa7-e5ea-4d80-9e71-cde7473126fc","block_type":"box","text":"securities due to the limited number of investors in that sector of the market. There are fewer dealers in the junk","page_number":58,"box":{"x":102,"y":276,"width":805,"height":12}},{"id":"14f2d329-91ac-490e-a8d3-fcf3626b6093","block_type":"box","text":"bond market, and there may be significant differences in the prices quoted for junk bonds by the dealers, and","page_number":58,"box":{"x":102,"y":292,"width":781,"height":11}},{"id":"aa3be6bd-fc2f-4b1d-a7ad-ccd189677f0f","block_type":"box","text":"such quotations may not be the actual prices available for a purchase or sale. Because junk bonds are less","page_number":58,"box":{"x":102,"y":307,"width":767,"height":11}},{"id":"1d850e28-a22a-41bb-bbba-09ae2bc1a39e","block_type":"box","text":"liquid than higher rated bonds, judgment may play a greater role in valuing cer tain of a Fund’s por tfolio securities","page_number":58,"box":{"x":102,"y":322,"width":806,"height":11}},{"id":"1a5f73dd-72bc-4cde-bc63-b377a0463d43","block_type":"box","text":"than in the case of securities trading in a more liquid market.","page_number":58,"box":{"x":101,"y":337,"width":436,"height":11}},{"id":"8967055a-24cc-4218-84bb-868488d85070","block_type":"box","text":"•","page_number":58,"box":{"x":69,"y":360,"width":6,"height":5}},{"id":"4b5f399c-14e0-47e3-b3b0-6c7ba028bf83","block_type":"box","text":"The secondary markets for high yield securities are not as liquid as the secondary markets for higher rated","page_number":58,"box":{"x":101,"y":357,"width":763,"height":11}},{"id":"08e8a491-cfd5-4da7-bfdf-2f73a0a9e6ea","block_type":"box","text":"securities. The secondary markets for high yield securities are concentrated in relatively few market makers and","page_number":58,"box":{"x":102,"y":372,"width":798,"height":11}},{"id":"22318d07-57b1-41ec-b451-5983426575c2","block_type":"box","text":"par ticipants in the markets are mostly institutional investors, including insurance companies, banks, other","page_number":58,"box":{"x":102,"y":388,"width":759,"height":11}},{"id":"8a812a98-9df8-4b67-9f06-62a31a2949b1","block_type":"box","text":"financial institutions and mutual funds. In addition, the trading volume for high yield securities is generally lower","page_number":58,"box":{"x":101,"y":402,"width":798,"height":12}},{"id":"cdf2026d-db38-4a07-9e8b-ba0d3a9bba00","block_type":"box","text":"than that for higher rated securities and the secondary markets could contract under adverse market or","page_number":58,"box":{"x":101,"y":418,"width":739,"height":11}},{"id":"baf6a0eb-84e3-4b41-8581-2f63d60ac594","block_type":"box","text":"economic conditions independent of any specific adverse changes in the condition of a par ticular issuer. Under","page_number":58,"box":{"x":101,"y":433,"width":792,"height":11}},{"id":"9f0a56d2-10f4-4802-9293-ed4d0cb28f48","block_type":"box","text":"cer tain economic and/or market conditions, a Fund may have difficulty disposing of cer tain high yield securities","page_number":58,"box":{"x":101,"y":448,"width":797,"height":11}},{"id":"5185f0a4-c084-4b92-9499-8b4f48851f6a","block_type":"box","text":"due to the limited number of investors in that sector of the market. An illiquid secondary market may adversely","page_number":58,"box":{"x":101,"y":463,"width":791,"height":11}},{"id":"3db5756f-29d4-45a2-81ac-cf2236c8b014","block_type":"box","text":"affect the market price of the high yield security, which may result in increased difficulty selling the par ticular","page_number":58,"box":{"x":102,"y":478,"width":777,"height":11}},{"id":"ed937395-a0dd-4aac-acf7-8d2d6e255fca","block_type":"box","text":"issue and obtaining accurate market quotations on the issue when valuing a Fund’s assets. Market quotations","page_number":58,"box":{"x":102,"y":493,"width":788,"height":11}},{"id":"2a4a934f-0322-4e9d-a51d-aec4a9f978c5","block_type":"box","text":"on high yield securities are available only from a limited number of dealers, and such quotations may not be the","page_number":58,"box":{"x":102,"y":508,"width":797,"height":12}},{"id":"7462f001-27ed-48c1-a371-5a3aa3bb083e","block_type":"box","text":"actual prices available for a purchase or sale. When the secondary market for high yield securities becomes","page_number":58,"box":{"x":102,"y":523,"width":769,"height":12}},{"id":"1d4590be-3efd-4cd9-909b-289b3d58d190","block_type":"box","text":"more illiquid, or in the absence of readily available market quotations for such securities, the relative lack of","page_number":58,"box":{"x":102,"y":538,"width":772,"height":12}},{"id":"3649e56c-94e5-434c-834a-4e17fb0692c9","block_type":"box","text":"reliable objective data makes it more difficult to value a Fund’s securities, and judgment plays a more impor tant","page_number":58,"box":{"x":102,"y":554,"width":801,"height":11}},{"id":"b1e6fca5-75cd-45d7-9aa4-a8201e5af1d6","block_type":"box","text":"role in determining such valuations.","page_number":58,"box":{"x":102,"y":569,"width":252,"height":11}},{"id":"8db7a056-752f-4faa-a440-64dacf13f381","block_type":"box","text":"•","page_number":58,"box":{"x":69,"y":592,"width":6,"height":4}},{"id":"bf7e54f2-b877-4edd-bd69-d1caa81ba0cb","block_type":"box","text":"A Fund may incur expenses to the extent necessary to seek recovery upon default or to negotiate new terms with","page_number":58,"box":{"x":101,"y":589,"width":808,"height":11}},{"id":"ca1c4e4f-6b2d-41a7-9a8e-9f1256ddb3f9","block_type":"box","text":"a defaulting issuer.","page_number":58,"box":{"x":102,"y":604,"width":134,"height":11}},{"id":"92385e25-488a-4149-aa5d-ee54594d8f19","block_type":"box","text":"•","page_number":58,"box":{"x":69,"y":627,"width":6,"height":5}},{"id":"e085135f-377d-4c47-9976-770518038224","block_type":"box","text":"The junk bond markets may react strongly to adverse news about an issuer or the economy, or to the perception","page_number":58,"box":{"x":101,"y":624,"width":800,"height":11}},{"id":"47496a04-6ad6-4c66-9e49-e809efe1c9c8","block_type":"box","text":"or expectation of adverse news, whether or not it is based on fundamental analysis. Additionally, prices for high","page_number":58,"box":{"x":102,"y":639,"width":793,"height":12}},{"id":"bb6a44bf-b0d8-4b9c-8861-9212e104a6bc","block_type":"box","text":"yield securities may be affected by legislative and regulatory developments. These developments could adversely","page_number":58,"box":{"x":101,"y":654,"width":808,"height":12}},{"id":"59b45912-bc0b-4fba-86bd-17249cfe613e","block_type":"box","text":"affect a Fund’s NAV and investment practices, the secondary market for high yield securities, the financial","page_number":58,"box":{"x":102,"y":669,"width":756,"height":12}},{"id":"ad493b97-1864-49c0-a383-f367cf7f40b8","block_type":"box","text":"condition of issuers of these securities and the value and liquidity of outstanding high yield securities, especially","page_number":58,"box":{"x":101,"y":685,"width":803,"height":11}},{"id":"bbd622a3-6565-42b6-8720-0cd86e3a33aa","block_type":"box","text":"in a thinly traded market. For example, federal legislation requiring the divestiture by federally insured savings","page_number":58,"box":{"x":102,"y":700,"width":781,"height":11}},{"id":"493464b1-9e4a-410b-af4c-23b4246ae5f5","block_type":"box","text":"and loan associations of their investments in high yield bonds and limiting the deductibility of interest by cer tain","page_number":58,"box":{"x":102,"y":715,"width":798,"height":11}},{"id":"e68af766-475d-4de0-9ae2-d819f2b08d6c","block_type":"box","text":"corporate issuers of high yield bonds adversely affected the market in the past.","page_number":58,"box":{"x":101,"y":730,"width":566,"height":11}},{"id":"644e1db1-7bae-4d19-8b0b-db84e9338aac","block_type":"box","text":"•","page_number":58,"box":{"x":69,"y":753,"width":6,"height":5}},{"id":"e8725cbb-1017-42f1-8e5d-e0d9e570665b","block_type":"box","text":"The rating assigned by a rating agency evaluates the issuing agency’s assessment of the safety of a non","page_number":58,"box":{"x":101,"y":750,"width":751,"height":11}},{"id":"9569eda1-b534-43d8-932b-afe206892a7b","block_type":"box","text":"investment grade security’s principal and interest payments, but does not address market value risk. Because","page_number":58,"box":{"x":102,"y":766,"width":786,"height":11}},{"id":"01f7c624-3399-4ced-93a4-dc2db3d4a88e","block_type":"box","text":"such ratings of the ratings agencies may not always reflect current conditions and events, in addition to using","page_number":58,"box":{"x":102,"y":780,"width":782,"height":12}},{"id":"5b04528c-ffc0-40b8-a424-99add3708741","block_type":"box","text":"recognized rating agencies and other sources, the Manager or sub-adviser per forms its own analysis of the","page_number":58,"box":{"x":102,"y":795,"width":762,"height":12}},{"id":"d891fed3-e1dd-4bf3-8f4d-f860f983d97b","block_type":"box","text":"issuers whose non-investment grade securities a Fund holds. Because of this, the Fund’s per formance may","page_number":58,"box":{"x":102,"y":811,"width":767,"height":11}},{"id":"4361c47a-52c1-45fa-bdaa-5f6d918ee34a","block_type":"box","text":"depend more on the Manager’s or sub-adviser’s own credit analysis than in the case of mutual funds investing in","page_number":58,"box":{"x":101,"y":826,"width":806,"height":11}},{"id":"14f779d6-5bca-47cc-9d07-12f27bf23541","block_type":"box","text":"higher-rated securities.","page_number":58,"box":{"x":102,"y":841,"width":161,"height":11}},{"id":"af8beee5-a031-45f4-9106-49639e8d9003","block_type":"box","text":"In selecting non-investment grade securities, the Manager or sub-adviser considers factors such as those","page_number":58,"box":{"x":102,"y":863,"width":751,"height":12}},{"id":"7a1b0f05-8ead-4511-9754-d2df9481d229","block_type":"box","text":"relating to the creditwor thiness of issuers, the ratings and per formance of the securities, the protections afforded","page_number":58,"box":{"x":69,"y":879,"width":814,"height":11}},{"id":"1c496163-75d4-408a-89b5-9eb4d7d37742","block_type":"box","text":"the securities and the diversity of the Fund. The Manager or sub-adviser continuously monitors the issuers of non","page_number":58,"box":{"x":68,"y":894,"width":812,"height":11}},{"id":"0e84b89d-f4d9-4434-aa41-9cb9c3bd02ef","block_type":"box","text":"investment grade securities held by the Fund for their ability to make required principal and interest payments, as","page_number":58,"box":{"x":70,"y":909,"width":808,"height":11}},{"id":"56062b3e-8a40-49d0-a985-d442f2d8e338","block_type":"box","text":"II-11","page_number":58,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"51e5c819-043a-4d1f-b025-f33ab6276d7a","block_type":"box","text":"NM1026U-6033063-58/246","page_number":58,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"9e0f8d35-e858-4964-a033-003724ee00df","block_type":"box","text":"well as in an effor t to control the liquidity of the Fund so that it can meet redemption requests. If a security’s rating","page_number":59,"box":{"x":68,"y":45,"width":825,"height":11}},{"id":"095681b2-ecd3-4f5c-8257-7419ddb0b78d","block_type":"box","text":"is reduced below the minimum credit rating that is permitted for a Fund, the Fund’s adviser or sub-adviser will","page_number":59,"box":{"x":70,"y":60,"width":779,"height":11}},{"id":"28eec8e0-c456-401e-b59d-0adec2e4409c","block_type":"box","text":"consider whether the Fund should continue to hold the security.","page_number":59,"box":{"x":69,"y":75,"width":451,"height":11}},{"id":"6b0bec40-869f-41a5-9cc0-097b163a5d73","block_type":"box","text":"In the event that a Fund investing in high yield securities experiences an unexpected level of net redemptions,","page_number":59,"box":{"x":102,"y":98,"width":782,"height":11}},{"id":"4d572d25-6182-49c9-8363-0c1c8e964267","block_type":"box","text":"the Fund could be forced to sell its holdings without regard to the investment merits, thereby decreasing the assets","page_number":59,"box":{"x":68,"y":113,"width":825,"height":11}},{"id":"b46dcf1b-0eaf-4c59-8212-9f7a78acbe24","block_type":"box","text":"upon which the Fund’s rate of return is based.","page_number":59,"box":{"x":69,"y":128,"width":328,"height":11}},{"id":"7fde7999-17b0-45c5-90bf-23a85a18fac6","block_type":"box","text":"The costs attributable to investing in the junk bond markets are usually higher for several reasons, such as","page_number":59,"box":{"x":101,"y":150,"width":764,"height":12}},{"id":"aa54d274-df0b-48fa-ba01-bd8e39434b8c","block_type":"box","text":"higher investment research costs and higher commission costs.","page_number":59,"box":{"x":69,"y":166,"width":455,"height":11}},{"id":"b3dda22d-c416-409c-99d7-5fd164e3eb03","block_type":"box","text":"Mezzanine Investments.","page_number":59,"box":{"x":102,"y":188,"width":170,"height":9}},{"id":"1124ee34-fcb8-40ac-9a36-66567d3df265","block_type":"box","text":"Cer tain Funds, consistent with their restrictions on investing in securities of a specific","page_number":59,"box":{"x":279,"y":188,"width":612,"height":12}},{"id":"d6f736ae-1d88-4b2a-a0d2-f793b97db26c","block_type":"box","text":"credit quality, may invest in cer tain high yield securities known as mezzanine investments, which are subordinated","page_number":59,"box":{"x":69,"y":204,"width":813,"height":11}},{"id":"79966bb4-c81a-434c-9605-5b128ea1744b","block_type":"box","text":"debt securities which are generally issued in private placements in connection with an equity security (","page_number":59,"box":{"x":69,"y":219,"width":729,"height":11}},{"id":"e8b9c182-64df-4311-bce0-5041f69de849","block_type":"box","text":"e.g.","page_number":59,"box":{"x":800,"y":220,"width":24,"height":10}},{"id":"8e7de6d1-0bbf-458b-98d9-c5d0af8f86fb","block_type":"box","text":", with","page_number":59,"box":{"x":827,"y":219,"width":36,"height":10}},{"id":"365e39b2-3099-4fc6-8581-644a69c1fe56","block_type":"box","text":"attached warrants). Such mezzanine investments may be issued with or without registration rights. Similar to other","page_number":59,"box":{"x":69,"y":234,"width":818,"height":11}},{"id":"c21749e2-7e97-4ff1-a451-fb47d01dcc29","block_type":"box","text":"high yield securities, maturities of mezzanine investments are typically seven to ten years, but the expected average","page_number":59,"box":{"x":69,"y":249,"width":827,"height":11}},{"id":"6aa9845d-dc64-44a9-983c-e35395dd0b0f","block_type":"box","text":"life is significantly shor ter at three to five years. Mezzanine investments are usually unsecured and subordinate to","page_number":59,"box":{"x":70,"y":264,"width":813,"height":11}},{"id":"c8649aba-45dd-4e38-ad06-04db5c17407d","block_type":"box","text":"other obligations of the issuer.","page_number":59,"box":{"x":69,"y":279,"width":216,"height":11}},{"id":"65d00553-2a38-4344-a623-3d59a990c812","block_type":"box","text":"Pay-in-kind Bonds.","page_number":59,"box":{"x":102,"y":302,"width":127,"height":11}},{"id":"753fd570-1fba-46fa-9e79-a121a835931d","block_type":"box","text":"Cer tain Funds may invest in pay-in-kind, or PIK, bonds. PIK bonds are bonds which pay","page_number":59,"box":{"x":236,"y":302,"width":615,"height":11}},{"id":"9f529366-c225-4893-ad13-70fec848752e","block_type":"box","text":"interest through the issuance of additional debt or equity securities. Similar to zero coupon obligations, pay-in-kind","page_number":59,"box":{"x":70,"y":317,"width":813,"height":11}},{"id":"9b2429ae-966c-4732-b75b-f5c2cc6965c2","block_type":"box","text":"bonds also carry additional risk as holders of these types of securities realize no cash until the cash payment date","page_number":59,"box":{"x":69,"y":332,"width":820,"height":11}},{"id":"9ebe2c11-98bd-448e-a7c2-89651dc41a76","block_type":"box","text":"unless a por tion of such securities is sold and, if the issuer defaults, a Fund may obtain no return at all on its","page_number":59,"box":{"x":69,"y":347,"width":784,"height":11}},{"id":"c3fbfc99-fb21-453e-8e13-7e837dd26a86","block_type":"box","text":"investment. The market price of pay-in-kind bonds is affected by interest rate changes to a greater extent, and","page_number":59,"box":{"x":70,"y":362,"width":783,"height":11}},{"id":"f87977a0-a9b2-4068-b6ac-06ef8db94e84","block_type":"box","text":"therefore tends to be more volatile, than that of securities which pay interest in cash. Additionally, current U.S.","page_number":59,"box":{"x":68,"y":377,"width":790,"height":11}},{"id":"d2c86331-ef5e-40d2-9640-317d7ea572e6","block_type":"box","text":"federal tax law requires the holder of pay-in-kind bonds to accrue income with respect to these securities prior to the","page_number":59,"box":{"x":68,"y":392,"width":831,"height":12}},{"id":"deac6336-cb38-4c21-b562-2833fa2f8c26","block_type":"box","text":"receipt of cash payments. To maintain its qualification as a regulated investment company and avoid liability for U.S.","page_number":59,"box":{"x":69,"y":407,"width":830,"height":12}},{"id":"f8585c5d-dc6b-44a9-bb48-d3a459f72e35","block_type":"box","text":"federal income and excise taxes, each Fund may be required to distribute income accrued with respect to these","page_number":59,"box":{"x":68,"y":423,"width":798,"height":11}},{"id":"73d785b6-9790-4f27-995a-cff80e8d9969","block_type":"box","text":"securities and may have to dispose of por tfolio securities under disadvantageous circumstances in order to generate","page_number":59,"box":{"x":69,"y":438,"width":835,"height":11}},{"id":"bb8cb333-fcb4-4d81-aca8-340f33d6f968","block_type":"box","text":"cash to satisfy these distribution requirements.","page_number":59,"box":{"x":69,"y":453,"width":336,"height":11}},{"id":"171dc51a-e864-4306-adfa-a458997f277c","block_type":"box","text":"Supranational Entities.","page_number":59,"box":{"x":102,"y":476,"width":160,"height":10}},{"id":"8ba3da45-a2dc-4be4-964b-481cc42628d5","block_type":"box","text":"A Fund may invest in debt securities of supranational entities. Examples of such entities","page_number":59,"box":{"x":268,"y":475,"width":629,"height":12}},{"id":"4c95584f-b7e0-4de0-812a-3a485b7fb914","block_type":"box","text":"include the International Bank for Reconstruction and Development (the World Bank), the European Steel and Coal","page_number":59,"box":{"x":70,"y":491,"width":814,"height":11}},{"id":"e91220ae-412f-4cc4-b3af-1a33142aa2cf","block_type":"box","text":"Community, the Asian Development Bank and the Inter-American Development Bank. The government members, or","page_number":59,"box":{"x":69,"y":506,"width":817,"height":11}},{"id":"c956839e-9363-490c-b9d3-31525dc0236b","block_type":"box","text":"“stockholders,” usually make initial capital contributions to the supranational entity and in many cases are","page_number":59,"box":{"x":70,"y":521,"width":759,"height":11}},{"id":"a1617c6d-4c64-4fe5-9ceb-1a6fd5f758e5","block_type":"box","text":"committed to make additional capital contributions if the supranational entity is unable to repay its borrowings. There","page_number":59,"box":{"x":69,"y":536,"width":836,"height":11}},{"id":"6abb72dd-1f1e-4785-83c2-857fa6a1c7f2","block_type":"box","text":"is no guarantee that one or more stockholders of a supranational entity will continue to make any necessary","page_number":59,"box":{"x":70,"y":551,"width":772,"height":11}},{"id":"a386cf14-b051-4b32-83d8-50137decf906","block_type":"box","text":"additional capital contributions. If such contributions are not made, the entity may be unable to pay interest or repay","page_number":59,"box":{"x":69,"y":566,"width":830,"height":11}},{"id":"c93a8ad0-fa06-4eb5-97e8-ec166047067b","block_type":"box","text":"principal on its debt securities, and a Fund may lose money on such investments.","page_number":59,"box":{"x":70,"y":582,"width":580,"height":10}},{"id":"d8a11477-7cb9-4a3e-ae6e-5693081a9837","block_type":"box","text":"Depositary Receipts (ADRs, EDRs and GDRs).","page_number":59,"box":{"x":102,"y":604,"width":334,"height":11}},{"id":"77f26838-c846-4ccf-8124-b98ff56ee252","block_type":"box","text":"Cer tain Funds may invest in the securities of foreign issuers in","page_number":59,"box":{"x":442,"y":604,"width":446,"height":11}},{"id":"a199bde7-9a51-43c1-b167-b4872fe8c431","block_type":"box","text":"the form of Depositary Receipts or other securities conver tible into securities of foreign issuers. Depositary Receipts","page_number":59,"box":{"x":68,"y":619,"width":835,"height":11}},{"id":"a9fc540f-1fd3-4f24-b5fe-6c23a8e041d2","block_type":"box","text":"may not necessarily be denominated in the same currency as the underlying securities into which they may be","page_number":59,"box":{"x":69,"y":634,"width":784,"height":12}},{"id":"bf3be242-938d-4743-ab3a-d1ccc3097ffe","block_type":"box","text":"conver ted. The Fund may invest in both sponsored and unsponsored American Depositary Receipts (“ADRs”),","page_number":59,"box":{"x":69,"y":650,"width":781,"height":11}},{"id":"7ab2a073-1303-41cc-9dad-cac4b976c19b","block_type":"box","text":"European Depositary Receipts (“EDRs”), Global Depositary Receipts (“GDRs”) and other similar global instruments.","page_number":59,"box":{"x":70,"y":665,"width":823,"height":11}},{"id":"0592a007-14c9-4e85-ae96-54533897a603","block_type":"box","text":"ADRs typically are issued by an American bank or trust company and evidence ownership of underlying securities","page_number":59,"box":{"x":68,"y":680,"width":804,"height":11}},{"id":"a5f00e80-d1f6-4565-9fba-da62dae9e41f","block_type":"box","text":"issued by a foreign corporation. EDRs, which are sometimes referred to as Continental Depositary Receipts, are","page_number":59,"box":{"x":70,"y":695,"width":799,"height":11}},{"id":"ac711bf2-41d7-402c-85e8-7aff4657649a","block_type":"box","text":"receipts issued in Europe, typically by foreign banks and trust companies, that evidence ownership of either foreign","page_number":59,"box":{"x":69,"y":710,"width":821,"height":11}},{"id":"a7626c2e-a25e-4ef7-8ee3-8ffc6aba2408","block_type":"box","text":"or domestic underlying securities. GDRs are depositary receipts structured like global debt issues to facilitate trading","page_number":59,"box":{"x":69,"y":725,"width":837,"height":11}},{"id":"bde76a77-7832-4018-8b58-537980e5a87f","block_type":"box","text":"on an international basis. In addition to investment risks associated with the underlying issuer, Depositary Receipts","page_number":59,"box":{"x":69,"y":740,"width":825,"height":11}},{"id":"45b9bbe4-64df-443b-bc10-64a49cc41f77","block_type":"box","text":"expose a Fund to additional risks associated with the non-uniform terms that apply to Depositary Receipt programs,","page_number":59,"box":{"x":69,"y":755,"width":825,"height":11}},{"id":"aa1540c5-9cda-4eb8-a75b-7405d3feccc7","block_type":"box","text":"credit exposure to the depository bank and to the sponsors and other par ties with whom the depository bank","page_number":59,"box":{"x":69,"y":771,"width":780,"height":10}},{"id":"e71dae14-de34-42b0-9ec0-4e9901578534","block_type":"box","text":"establishes the programs, currency risk and the risk of an illiquid market for Depositary Receipts. Unsponsored ADR,","page_number":59,"box":{"x":69,"y":785,"width":833,"height":12}},{"id":"79b9a96a-20e9-45df-b817-b03a2d068985","block_type":"box","text":"EDR and GDR programs are organized independently and without the cooperation of the issuer of the underlying","page_number":59,"box":{"x":70,"y":801,"width":796,"height":11}},{"id":"e4a8c277-18ec-46e8-a8bb-fff700e31e95","block_type":"box","text":"securities. Unsponsored programs generally expose investors to greater risks than sponsored programs and do not","page_number":59,"box":{"x":69,"y":816,"width":822,"height":11}},{"id":"36da5b45-1a0e-4a55-848d-4bc1bc277bfe","block_type":"box","text":"provide holders with many of the shareholder benefits that come from investing in a sponsored Depositary Receipt.","page_number":59,"box":{"x":70,"y":831,"width":820,"height":11}},{"id":"a1911d0f-5f00-4852-b4c8-eaf387051242","block_type":"box","text":"Available information concerning the issuer may not be as current as for sponsored ADRs, EDRs and GDRs, and the","page_number":59,"box":{"x":68,"y":846,"width":827,"height":11}},{"id":"75d91447-5e1d-4d86-9088-4752bc7ed7be","block_type":"box","text":"prices of unsponsored ADRs, EDRs and GDRs may be more volatile than if such instruments were sponsored by the","page_number":59,"box":{"x":70,"y":861,"width":825,"height":11}},{"id":"5c143585-38c2-45c4-b805-01491a1cee10","block_type":"box","text":"issuer. Depositary Receipts are generally subject to the same risks as the foreign securities that they evidence or","page_number":59,"box":{"x":70,"y":876,"width":810,"height":11}},{"id":"cd65dca6-91ad-4265-8367-ebd70ffd379c","block_type":"box","text":"into which they may be conver ted. Investments in ADRs, EDRs and GDRs present additional investment","page_number":59,"box":{"x":70,"y":891,"width":737,"height":11}},{"id":"24376b98-4d42-49a4-ad2c-b7b789fc9e95","block_type":"box","text":"considerations as described under “Foreign Investment Risks.”","page_number":59,"box":{"x":69,"y":907,"width":449,"height":11}},{"id":"2d7f516b-ece6-49e8-b9fc-8e5cf8fea3f1","block_type":"box","text":"II-12","page_number":59,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"bfa18382-509d-44eb-9aae-a642966d381c","block_type":"box","text":"NM1026U-6033063-59/246","page_number":59,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"e3090dd8-1bc6-4002-9fac-da488e0cecac","block_type":"box","text":"Derivatives.","page_number":60,"box":{"x":102,"y":45,"width":84,"height":9}},{"id":"3032a1ee-29d8-438a-ab38-8bcd1fc8f8fb","block_type":"box","text":"General.","page_number":60,"box":{"x":102,"y":67,"width":58,"height":9}},{"id":"c48c49b4-b0e8-424a-ade2-8ad0cf1f1398","block_type":"box","text":"Each Fund may use instruments referred to as derivatives, which are financial instruments that derive","page_number":60,"box":{"x":167,"y":67,"width":725,"height":11}},{"id":"7ff15164-e335-4cbe-91aa-fe91dfef8dfe","block_type":"box","text":"their value from one or more securities, commodities (such as gold or oil), currencies, interest rates, credit events or","page_number":60,"box":{"x":68,"y":82,"width":836,"height":12}},{"id":"bce24eaa-faae-40a0-9938-d6cd847c01a2","block_type":"box","text":"indices (a measure of value or rates, such as the S&P 500 Index or the prime lending rate) or other reference asset.","page_number":60,"box":{"x":70,"y":98,"width":829,"height":11}},{"id":"f4a0c5a6-9407-4fc4-927e-c9e822b996ce","block_type":"box","text":"Derivatives may allow a Fund to increase or decrease the level of risk to which the Fund is exposed more quickly and","page_number":60,"box":{"x":70,"y":113,"width":830,"height":11}},{"id":"74301fd7-bcef-419c-bc0c-8b5d698898c4","block_type":"box","text":"efficiently than with other transactions. Cer tain Funds may use derivatives to maintain a por tion of their long and","page_number":60,"box":{"x":69,"y":128,"width":804,"height":11}},{"id":"9b2d3620-7bbd-4bbf-8f4f-3fb9d24f8aea","block_type":"box","text":"shor t positions. Unless otherwise permitted, no Fund may use derivatives to gain exposure to an asset or asset","page_number":60,"box":{"x":69,"y":143,"width":800,"height":11}},{"id":"a6371fd0-9dd9-4778-ae3d-df3fd9cb8a0f","block_type":"box","text":"class it is prohibited by its investment restrictions from purchasing directly. As described below, derivatives can be","page_number":60,"box":{"x":69,"y":158,"width":816,"height":11}},{"id":"5ec2c44f-782a-4a26-8385-737791e28884","block_type":"box","text":"used for hedging or speculative purposes. Funds will engage in transaction-level payment netting,","page_number":60,"box":{"x":69,"y":173,"width":691,"height":11}},{"id":"3c15620e-12cd-4475-a3dd-0f96a248a26b","block_type":"box","text":"i.e.","page_number":60,"box":{"x":768,"y":173,"width":20,"height":9}},{"id":"8674cef9-9152-4996-90f0-0110958c448d","block_type":"box","text":", the payment","page_number":60,"box":{"x":791,"y":173,"width":96,"height":11}},{"id":"1fc1bbb8-f2eb-4db5-813f-cd57baeb2799","block_type":"box","text":"obligations of derivatives contracts are netted against one another with the Fund receiving or paying, as the case may","page_number":60,"box":{"x":69,"y":188,"width":839,"height":12}},{"id":"d04fbc81-d99a-4310-ad73-31e97a485f43","block_type":"box","text":"be, only the net amount of the two payment streams.","page_number":60,"box":{"x":69,"y":203,"width":378,"height":12}},{"id":"18ce296e-5763-4f9b-9371-2abdb8924a1b","block_type":"box","text":"Hedging.","page_number":60,"box":{"x":102,"y":226,"width":60,"height":11}},{"id":"447c8311-e579-437a-906d-0f4ad725a327","block_type":"box","text":"Each Fund may use derivatives for hedging purposes, in which a derivative is used to offset the risks","page_number":60,"box":{"x":169,"y":226,"width":717,"height":11}},{"id":"cb21983b-a641-4e68-b7e5-6725ebf27948","block_type":"box","text":"associated with other Fund holdings. Losses on other investments may be substantially reduced by gains on a","page_number":60,"box":{"x":69,"y":241,"width":786,"height":11}},{"id":"ecd10404-9c3a-4b16-a71c-a94c75f36f23","block_type":"box","text":"derivative that reacts in an opposite manner to market movements. Although hedging may reduce losses, it may also","page_number":60,"box":{"x":69,"y":257,"width":834,"height":11}},{"id":"f45f7624-9ec0-44b8-9cb0-cf77a09d0626","block_type":"box","text":"reduce or eliminate gains. In addition, hedging may cause losses if the market moves in an unanticipated manner, or","page_number":60,"box":{"x":69,"y":271,"width":834,"height":12}},{"id":"fdcdad26-faba-4099-a7f2-bcb061e3b924","block_type":"box","text":"if the cost of the derivative outweighs the benefit of the hedge. The effectiveness of hedging may be reduced by","page_number":60,"box":{"x":70,"y":286,"width":797,"height":12}},{"id":"366b4ade-fd95-4233-8322-44d304ceba46","block_type":"box","text":"correlation risk,","page_number":60,"box":{"x":69,"y":302,"width":109,"height":10}},{"id":"3a422dc9-668c-4228-82ad-c4190f902e04","block_type":"box","text":"i.e.","page_number":60,"box":{"x":186,"y":302,"width":20,"height":9}},{"id":"8210cb48-d506-4836-8a16-baf94c50d7cc","block_type":"box","text":", the risk that changes in the value of the derivative will not match those of the holdings being","page_number":60,"box":{"x":209,"y":302,"width":669,"height":11}},{"id":"0e593e4c-f868-47bc-acbb-ad3acf383c12","block_type":"box","text":"hedged as expected by a Fund, which may result in additional losses to the Fund. The inability to close or offset","page_number":60,"box":{"x":69,"y":317,"width":797,"height":11}},{"id":"7d90037b-2f02-48a8-9e51-348f4f6e2e16","block_type":"box","text":"derivatives could also reduce the effectiveness of a Fund’s hedging. There is no assurance that a Fund’s hedging will","page_number":60,"box":{"x":69,"y":332,"width":835,"height":11}},{"id":"fc61f516-fecd-4645-b645-bc8e2278ea12","block_type":"box","text":"be effective. No Fund is required to use derivatives to hedge.","page_number":60,"box":{"x":69,"y":347,"width":434,"height":11}},{"id":"b1717538-76b5-4785-b0a2-858f37591dc9","block_type":"box","text":"Speculation.","page_number":60,"box":{"x":102,"y":370,"width":86,"height":11}},{"id":"1514345c-be42-48b8-9a13-ea35c7df439b","block_type":"box","text":"Cer tain Funds may also use derivatives for speculative purposes to seek to enhance returns. The","page_number":60,"box":{"x":195,"y":370,"width":694,"height":11}},{"id":"e7a7a493-acf4-468b-b623-cbc34bf5c29a","block_type":"box","text":"use of a derivative is speculative if the Fund is primarily seeking to achieve gains, rather than offset the risk of other","page_number":60,"box":{"x":69,"y":385,"width":831,"height":11}},{"id":"8f96bb29-c7d7-488f-ad35-209d2febcdfe","block_type":"box","text":"positions. To the extent a Fund invests in a derivative for speculative purposes, the Fund will be fully exposed to the","page_number":60,"box":{"x":70,"y":400,"width":824,"height":11}},{"id":"2013286a-8c28-44c1-8d1c-a4651ed9756e","block_type":"box","text":"risks of loss of that derivative, which may sometimes be greater than the derivative’s cost, and the potential for loss","page_number":60,"box":{"x":69,"y":415,"width":831,"height":11}},{"id":"e8579803-ffc0-4039-a43d-93efc041db6d","block_type":"box","text":"in cer tain cases may be unlimited.","page_number":60,"box":{"x":70,"y":430,"width":243,"height":11}},{"id":"ba483821-4ee7-47f7-adf7-fb93b722b96b","block_type":"box","text":"Regulation of Derivatives.","page_number":60,"box":{"x":102,"y":453,"width":180,"height":11}},{"id":"fb1bbfae-5c01-4950-857f-685c052445ea","block_type":"box","text":"Rule 18f-4 Under the Investment Company Act.","page_number":60,"box":{"x":102,"y":475,"width":333,"height":12}},{"id":"9be23bd4-3416-4856-9117-e25988b3c560","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to","page_number":60,"box":{"x":442,"y":475,"width":458,"height":12}},{"id":"f98c07e8-9070-4ffb-965d-88658ec12325","block_type":"box","text":"enter into Derivatives Transactions (as defined below) and cer tain other transactions notwithstanding the restrictions","page_number":60,"box":{"x":69,"y":491,"width":833,"height":11}},{"id":"69ff28c8-bf92-443b-b7f0-2d0413fdb0c3","block_type":"box","text":"on the issuance of “senior securities” under Section 18 of the Investment Company Act. Section 18 of the","page_number":60,"box":{"x":69,"y":506,"width":759,"height":11}},{"id":"9e78dc99-7954-42c0-99c8-ec6cf04b3a87","block_type":"box","text":"Investment Company Act, among other things, prohibits open-end funds, including the Funds, from issuing or selling","page_number":60,"box":{"x":70,"y":521,"width":825,"height":11}},{"id":"a5f7acf7-95ad-49f6-8c23-5cd3254b63a8","block_type":"box","text":"any “senior security,” other than borrowing from a bank (subject to a requirement to maintain 300% “asset","page_number":60,"box":{"x":69,"y":536,"width":763,"height":11}},{"id":"70680f0f-34b5-4cde-a051-2f33cf9aac72","block_type":"box","text":"coverage”).","page_number":60,"box":{"x":69,"y":551,"width":79,"height":11}},{"id":"d448413b-890b-4e94-8efe-d689f868b9b9","block_type":"box","text":"Under Rule 18f-4, “Derivatives Transactions” include the following: (1) any swap, security-based swap (including","page_number":60,"box":{"x":102,"y":574,"width":796,"height":11}},{"id":"46deea19-e039-4bff-a26a-894986b95dad","block_type":"box","text":"a contract for differences), futures contract, forward contract, option (excluding purchased options), any combination","page_number":60,"box":{"x":69,"y":589,"width":832,"height":11}},{"id":"456b0318-e4f0-451a-8b2e-89a4577b7f27","block_type":"box","text":"of the foregoing, or any similar instrument, under which a Fund is or may be required to make any payment or delivery","page_number":60,"box":{"x":69,"y":604,"width":840,"height":11}},{"id":"75908e10-a6ed-4e34-aa8c-a516753b0d66","block_type":"box","text":"of cash or other assets during the life of the instrument or at maturity or early termination, whether as margin or","page_number":60,"box":{"x":69,"y":619,"width":801,"height":11}},{"id":"b5d5194e-7f99-42a4-a7e6-0f69ccaa5e2f","block_type":"box","text":"settlement payment or otherwise; (2) any shor t sale borrowing; (3) reverse repurchase agreements and similar","page_number":60,"box":{"x":69,"y":634,"width":791,"height":12}},{"id":"f970d35e-a640-452a-ae65-f73e17739af1","block_type":"box","text":"financing transactions (","page_number":60,"box":{"x":68,"y":649,"width":166,"height":12}},{"id":"a11f22fe-4855-430b-8d9c-5430973d4b3e","block_type":"box","text":"e.g.","page_number":60,"box":{"x":236,"y":651,"width":25,"height":10}},{"id":"2eb4f8bc-4af5-4ff8-b26a-77cc5b007c08","block_type":"box","text":", recourse and non-recourse tender option bonds, and borrowed bonds), if a Fund elects to","page_number":60,"box":{"x":263,"y":649,"width":646,"height":11}},{"id":"94f25378-712a-44a3-b449-25f89fdca5d4","block_type":"box","text":"treat all of these transactions as Derivatives Transactions under Rule 18f-4; and (4) when-issued or forward-settling","page_number":60,"box":{"x":68,"y":664,"width":825,"height":12}},{"id":"424766b8-0aee-4e37-9b03-ec6b951158d9","block_type":"box","text":"securities (","page_number":60,"box":{"x":69,"y":680,"width":78,"height":11}},{"id":"27df66c8-0060-44c5-bd71-e5b4d68f2f5d","block_type":"box","text":"e.g.","page_number":60,"box":{"x":148,"y":681,"width":25,"height":10}},{"id":"4fd20737-c078-4906-99d8-10aa46cf8822","block_type":"box","text":", firm and standby commitments, including to-be-announced (“TBA”) commitments, and dollar rolls)","page_number":60,"box":{"x":176,"y":680,"width":704,"height":11}},{"id":"a416ada8-4fbf-45ba-82ff-191a2f8c2db4","block_type":"box","text":"and non-standard settlement cycle securities, unless such transactions meet the Delayed-Settlement Securities","page_number":60,"box":{"x":69,"y":695,"width":796,"height":11}},{"id":"9852802a-c77f-4e11-976f-1436c2fa0393","block_type":"box","text":"Provision (as defined below under “—When-Issued Securities, Delayed Delivery Securities and Forward","page_number":60,"box":{"x":69,"y":710,"width":732,"height":11}},{"id":"ff15dc54-ce46-40f2-8d76-379fef4cc1f1","block_type":"box","text":"Commitments”).","page_number":60,"box":{"x":69,"y":725,"width":115,"height":11}},{"id":"41d9c0aa-fc9d-4230-a27b-93ab7de2a719","block_type":"box","text":"Unless a Fund is relying on the Limited Derivatives User Exception (as defined below), the Fund must comply with","page_number":60,"box":{"x":102,"y":748,"width":805,"height":11}},{"id":"0bfd1937-93fa-46f1-bff7-5cc4dbbd4548","block_type":"box","text":"Rule 18f-4 with respect to its Derivatives Transactions. Rule 18f-4, among other things, requires a Fund to adopt and","page_number":60,"box":{"x":70,"y":763,"width":832,"height":11}},{"id":"ffe327a4-dcea-4c8f-a6bb-fd727b1706c6","block_type":"box","text":"implement a comprehensive written derivatives risk management program (“DRMP”) and comply with a relative or","page_number":60,"box":{"x":70,"y":778,"width":808,"height":11}},{"id":"f86127e5-7d1a-4e9d-a890-079e3437886d","block_type":"box","text":"absolute limit on Fund leverage risk calculated based on value-at-risk (“VaR”). The DRMP is administered by a","page_number":60,"box":{"x":69,"y":793,"width":780,"height":11}},{"id":"fed37339-736b-4273-9e05-68e1050b1934","block_type":"box","text":"“derivatives risk manager,” who is appointed by the Fund’s Board, including a majority of the independent Directors,","page_number":60,"box":{"x":70,"y":808,"width":824,"height":11}},{"id":"837e6a4f-96d5-4d3b-9f34-46aa1f0c6c69","block_type":"box","text":"and periodically reviews the DRMP and repor ts to the Fund’s Board.","page_number":60,"box":{"x":69,"y":823,"width":482,"height":11}},{"id":"50c5affe-d3eb-41b5-af19-626b33bf692a","block_type":"box","text":"Rule 18f-4 provides an exception from the DRMP, VaR limit and cer tain other requirements if a Fund’s","page_number":60,"box":{"x":102,"y":846,"width":724,"height":11}},{"id":"d915a0ff-0861-4812-b5a5-17a51d52ba30","block_type":"box","text":"“derivatives exposure” is limited to 10% of its net assets (as calculated in accordance with Rule 18f-4) and the Fund","page_number":60,"box":{"x":70,"y":861,"width":830,"height":11}},{"id":"01bad4be-5a9d-4eda-b3e4-ee8537cb2cf4","block_type":"box","text":"adopts and implements written policies and procedures reasonably designed to manage its derivatives risks (the","page_number":60,"box":{"x":69,"y":876,"width":803,"height":11}},{"id":"1895deeb-e3c1-4f7a-a064-e2ce4d6edc15","block_type":"box","text":"“Limited Derivatives User Exception”).","page_number":60,"box":{"x":70,"y":891,"width":268,"height":11}},{"id":"772549b3-b22f-4129-84ce-911c13ff214c","block_type":"box","text":"II-13","page_number":60,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"ed930a08-038c-4072-a172-07d250b26eab","block_type":"box","text":"NM1026U-6033063-60/246","page_number":60,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"07da49a7-801c-43b1-af84-a963866bc5ce","block_type":"box","text":"Dodd-Frank Regulations.","page_number":61,"box":{"x":102,"y":45,"width":171,"height":11}},{"id":"b5acfb82-35e1-4983-869b-8fac44afdaae","block_type":"box","text":"The Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”),","page_number":61,"box":{"x":279,"y":45,"width":575,"height":11}},{"id":"589fa0d3-0c0f-4d0c-b6d9-2b6b79a88fc2","block_type":"box","text":"enacted in July 2010, includes provisions that comprehensively regulate the over-the-counter (“OTC”) derivatives","page_number":61,"box":{"x":69,"y":60,"width":800,"height":11}},{"id":"793c037a-4477-43a7-8ff9-c0c88e4f7de0","block_type":"box","text":"markets for the first time. While the Commodity Futures Trading Commission (“CFTC”) and other U.S. regulators have","page_number":61,"box":{"x":69,"y":75,"width":834,"height":11}},{"id":"766001d0-af96-4f53-8abc-cc33080b9aea","block_type":"box","text":"adopted many of the required Dodd-Frank regulations, cer tain regulations have only recently become effective and","page_number":61,"box":{"x":69,"y":90,"width":813,"height":11}},{"id":"c332c993-e68c-416c-877b-bbb48afc5fed","block_type":"box","text":"other regulations remain to be adopted. The full impact of Dodd-Frank on the Funds remains uncer tain.","page_number":61,"box":{"x":69,"y":105,"width":733,"height":11}},{"id":"4a2bde16-a0ad-4720-8554-dab9f57618c1","block_type":"box","text":"Many OTC derivatives dealers are required to register with the CFTC as “swap dealers” and/or with the SEC as","page_number":61,"box":{"x":102,"y":128,"width":789,"height":11}},{"id":"0bf7bf4a-61b7-4c9f-951a-df8e7136de85","block_type":"box","text":"“security-based swap dealers”. Registered swap dealers and security-based swap dealers are subject to various","page_number":61,"box":{"x":70,"y":143,"width":797,"height":11}},{"id":"f0952de1-56a2-4d24-b1a1-4fb2924107bc","block_type":"box","text":"regulatory requirements, including, but not limited to, margin, recordkeeping, repor ting, transparency, position limits,","page_number":61,"box":{"x":69,"y":158,"width":833,"height":11}},{"id":"b1e6e551-f619-4d9e-916c-4f22f3aa58cf","block_type":"box","text":"limitations on conflicts of interest, business conduct standards, minimum capital requirements and other regulatory","page_number":61,"box":{"x":70,"y":173,"width":826,"height":11}},{"id":"a5638145-32c4-4cfa-8956-3e5a8ab8d3ec","block_type":"box","text":"requirements, which indirectly impact the Funds that enter into transactions with them.","page_number":61,"box":{"x":69,"y":188,"width":618,"height":11}},{"id":"7e362420-cc9b-43f9-89c0-4ace4d75ef46","block_type":"box","text":"The CFTC requires that cer tain interest rate swaps and cer tain credit default swaps must be executed in","page_number":61,"box":{"x":101,"y":211,"width":745,"height":11}},{"id":"f7fd5669-29dd-4f9e-831e-ca719e0c5af4","block_type":"box","text":"regulated markets and be submitted for clearing to regulated clearinghouses. The SEC is also expected to impose","page_number":61,"box":{"x":69,"y":226,"width":813,"height":11}},{"id":"36347fdb-48d3-4655-9283-0c43c3dcd7b5","block_type":"box","text":"similar requirements on cer tain security-based derivatives in the future. OTC derivatives trades submitted for clearing","page_number":61,"box":{"x":69,"y":241,"width":835,"height":11}},{"id":"3c3a2fef-b543-40ac-ae1d-9369a92ca654","block_type":"box","text":"are subject to minimum initial and variation margin requirements set by the relevant clearinghouse, as well as margin","page_number":61,"box":{"x":69,"y":257,"width":837,"height":11}},{"id":"a1d46b28-6205-47a7-a167-d1ecd0b625c5","block_type":"box","text":"requirements mandated by the CFTC, SEC and/or federal prudential regulators. In addition, futures commission","page_number":61,"box":{"x":69,"y":271,"width":794,"height":12}},{"id":"e4a4e447-54cb-4d05-9331-aa308a7bf044","block_type":"box","text":"merchants (“FCMs”), who act as clearing members on behalf of customers for cleared OTC derivatives and futures","page_number":61,"box":{"x":69,"y":286,"width":815,"height":12}},{"id":"bf6c0d32-7cee-42dc-9980-cedba8c57126","block_type":"box","text":"contracts, also have discretion to increase a Fund’s margin requirements for these transactions beyond any","page_number":61,"box":{"x":69,"y":302,"width":770,"height":11}},{"id":"31203ce2-0ff4-48e0-be70-63bf07851835","block_type":"box","text":"regulatory and clearinghouse minimums subject to any restrictions on such discretion in the documentation between","page_number":61,"box":{"x":69,"y":317,"width":831,"height":11}},{"id":"da4ec3d7-0ea7-488d-afe1-3cb1fa3ac5a5","block_type":"box","text":"the FCM and the customer. These regulatory requirements may make it more difficult and costly for the Funds to","page_number":61,"box":{"x":68,"y":332,"width":804,"height":11}},{"id":"2775f316-0fd9-4fb7-969e-b9809e29ec8c","block_type":"box","text":"enter into highly tailored or customized transactions, potentially rendering cer tain investment strategies impossible or","page_number":61,"box":{"x":69,"y":347,"width":839,"height":11}},{"id":"34bf033d-81aa-44b4-9c56-abbaaa031fb3","block_type":"box","text":"not economically feasible. If a Fund decides to execute and clear cleared OTC derivatives and/or futures contracts","page_number":61,"box":{"x":69,"y":362,"width":814,"height":11}},{"id":"15eb14ba-23ea-43c2-8ba6-373d829f4bad","block_type":"box","text":"through execution facilities, exchanges or clearinghouses, either indirectly through an executing broker, clearing","page_number":61,"box":{"x":68,"y":377,"width":796,"height":12}},{"id":"9b3da904-dc92-4bed-8a99-62049ca5740f","block_type":"box","text":"member FCM or as a direct member, a Fund would be required to comply with the rules of the execution facility,","page_number":61,"box":{"x":69,"y":392,"width":793,"height":12}},{"id":"2301b346-0690-488e-a280-88fd505c1954","block_type":"box","text":"exchange or clearinghouse and other applicable law.","page_number":61,"box":{"x":69,"y":408,"width":370,"height":11}},{"id":"517acc57-e8d2-40ea-8ecc-51dc06b30761","block_type":"box","text":"With respect to cleared OTC derivatives and futures contracts and options on futures, a Fund will not face a","page_number":61,"box":{"x":101,"y":430,"width":766,"height":11}},{"id":"68747bf1-53fb-4a4f-bc14-0b051cb17a6e","block_type":"box","text":"clearinghouse directly but rather will do so through a FCM that is registered with the CFTC and/or SEC and that acts","page_number":61,"box":{"x":69,"y":445,"width":826,"height":12}},{"id":"b1b80c06-5b3a-4ee9-a061-c9f85a1001aa","block_type":"box","text":"as a clearing member. A Fund may face the indirect risk of the failure of another clearing member customer to meet","page_number":61,"box":{"x":69,"y":460,"width":825,"height":12}},{"id":"b6954943-113f-4f66-bdd6-b77ab9cd2f9f","block_type":"box","text":"its obligations to its clearing member. Such scenario could arise due to a default by the clearing member on its","page_number":61,"box":{"x":70,"y":475,"width":791,"height":12}},{"id":"4deb6940-0b7c-4fad-be58-633b8bd13e6c","block_type":"box","text":"obligations to the clearinghouse simultaneously with a customer’s failure to meet its obligations to the clearing","page_number":61,"box":{"x":69,"y":491,"width":793,"height":11}},{"id":"e2fbe9aa-2f88-499a-8d34-988a4661f187","block_type":"box","text":"member.","page_number":61,"box":{"x":69,"y":506,"width":60,"height":9}},{"id":"e806598f-8887-47cb-a49d-9aa8ebed151e","block_type":"box","text":"Clearing member FCMs are required to post initial margin to the clearinghouses through which they clear their","page_number":61,"box":{"x":102,"y":529,"width":782,"height":11}},{"id":"38de5e65-e847-4d43-9539-5db38584da94","block_type":"box","text":"customers’ cleared OTC derivatives and futures contracts, instead of using such initial margin in their businesses, as","page_number":61,"box":{"x":69,"y":543,"width":837,"height":12}},{"id":"1a1ad42f-4680-4902-8f85-303b5d79d1bc","block_type":"box","text":"was widely permitted for OTC derivatives before Dodd-Frank. While an FCM may require its customer to post initial","page_number":61,"box":{"x":68,"y":559,"width":811,"height":11}},{"id":"3378c3e9-30e1-4b76-bcc6-2af994eac403","block_type":"box","text":"margin in excess of clearinghouse requirements, and cer tain clearinghouses may share a por tion of their earnings on","page_number":61,"box":{"x":69,"y":574,"width":838,"height":11}},{"id":"c3ef085c-399e-468e-956e-5f3973df2e95","block_type":"box","text":"initial margin with their clearing members, some por tion of the initial margin that is passed through to the","page_number":61,"box":{"x":70,"y":589,"width":754,"height":11}},{"id":"b2c87a39-cdd0-4ee2-a718-11a84beec911","block_type":"box","text":"clearinghouse does not generate earnings for the FCM. The inability of FCMs to earn the same levels of returns on","page_number":61,"box":{"x":69,"y":604,"width":815,"height":11}},{"id":"e692bd3c-e00d-44c8-ae7a-d169204c743f","block_type":"box","text":"initial margin for cleared OTC derivatives as they could earn with respect to non-cleared OTC derivatives may cause","page_number":61,"box":{"x":70,"y":619,"width":817,"height":11}},{"id":"7967be23-3645-4a9c-9e42-441800b41ca5","block_type":"box","text":"FCMs to charge higher fees, or provide less favorable pricing on cleared OTC derivatives than swap dealers will","page_number":61,"box":{"x":70,"y":634,"width":788,"height":12}},{"id":"e3895790-278d-4545-a594-31f91f8d46b1","block_type":"box","text":"provide for non-cleared OTC derivatives. Fur thermore, customers, including the Funds, are subject to additional fees","page_number":61,"box":{"x":70,"y":649,"width":825,"height":12}},{"id":"c8dfdc3f-6fb3-4c31-8371-542a41271b80","block_type":"box","text":"payable to FCMs with respect to cleared OTC derivatives, which may raise the cost to Funds of clearing as compared","page_number":61,"box":{"x":70,"y":664,"width":829,"height":12}},{"id":"50dca3b9-82dc-44f7-807a-966c4eed3be6","block_type":"box","text":"to trading non-cleared OTC derivatives bilaterally.","page_number":61,"box":{"x":68,"y":680,"width":346,"height":11}},{"id":"1d4a961e-f6d8-4b19-a4fa-cd70e22473e1","block_type":"box","text":"With respect to uncleared swaps, registered swap dealers and security-based swap dealers are required to","page_number":61,"box":{"x":101,"y":703,"width":762,"height":11}},{"id":"ab6170a6-1ba3-4dba-a09d-68111a71b1fd","block_type":"box","text":"exchange variation margin with a Fund and may be required by applicable regulations to collect (and in some cases","page_number":61,"box":{"x":69,"y":718,"width":820,"height":11}},{"id":"3c8a32d8-a10b-455b-bc20-27a128b2e52e","block_type":"box","text":"exchange) initial margin with a Fund. Both initial and variation margin may be comprised of cash and/or securities,","page_number":61,"box":{"x":69,"y":732,"width":816,"height":12}},{"id":"7c73ebac-1f50-4613-b61a-1daf7bb04bd2","block_type":"box","text":"subject to applicable regulatory haircuts and other restrictions. Shares of investment companies (other than cer tain","page_number":61,"box":{"x":69,"y":748,"width":825,"height":11}},{"id":"c32e357a-1341-4839-a67a-a0949a8d9181","block_type":"box","text":"money market funds) may not be posted as collateral under applicable regulations.","page_number":61,"box":{"x":69,"y":763,"width":590,"height":11}},{"id":"921e3ac7-4163-435d-afc4-20cf7dc69d07","block_type":"box","text":"The CFTC, cer tain foreign regulators, and many futures exchanges have established (and continue to evaluate","page_number":61,"box":{"x":101,"y":785,"width":783,"height":12}},{"id":"74238004-e9e4-49b1-9b46-d320444b756a","block_type":"box","text":"and monitor) speculative position limits (“position limits”) on the maximum speculative position which any person, or","page_number":61,"box":{"x":69,"y":801,"width":833,"height":11}},{"id":"d7d7b576-0883-466e-98c5-4147f8c9eba1","block_type":"box","text":"group of persons acting in concer t, may hold or control in par ticular contracts. In addition, U.S. federal position limits","page_number":61,"box":{"x":68,"y":816,"width":837,"height":11}},{"id":"b55c12d1-1229-4353-b33b-a9072ad15f99","block_type":"box","text":"apply to swaps that are economically equivalent to futures contracts on cer tain agricultural, metals and energy","page_number":61,"box":{"x":69,"y":831,"width":789,"height":11}},{"id":"9a355bea-d07c-40c9-8f29-e133a34014fe","block_type":"box","text":"commodities. All positions owned or controlled by the same person or entity, even if in different accounts, must be","page_number":61,"box":{"x":69,"y":846,"width":818,"height":11}},{"id":"d583e848-7a97-471c-ac9c-37937f9e2e9c","block_type":"box","text":"aggregated for purposes of complying with the speculative limits. Thus, even if a Fund does not intend to exceed","page_number":61,"box":{"x":69,"y":861,"width":801,"height":11}},{"id":"89a584c8-55f8-4681-9e6a-d93de2e4d5f6","block_type":"box","text":"applicable position limits, it is possible that different clients managed by the Manager and its affiliates may be","page_number":61,"box":{"x":69,"y":876,"width":791,"height":11}},{"id":"fc2e3483-8c5f-4cc2-b7b2-11abab2dfdec","block_type":"box","text":"aggregated for this purpose. Therefore, the trading decisions of the Manager may have to be modified and positions","page_number":61,"box":{"x":69,"y":891,"width":827,"height":12}},{"id":"bf96ced4-ce6e-4d3a-b887-7b72814a8529","block_type":"box","text":"held by a Fund liquidated in order to avoid exceeding such limits. The modification of investment decisions or the","page_number":61,"box":{"x":69,"y":906,"width":805,"height":12}},{"id":"8bef40f2-9bea-4e75-a440-3ebecf803293","block_type":"box","text":"II-14","page_number":61,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"8c9c3440-e426-4343-8de1-0c52894ba708","block_type":"box","text":"NM1026U-6033063-61/246","page_number":61,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"a762d0ab-56ed-4477-9760-116a38628195","block_type":"box","text":"elimination of open positions, if it occurs, may adversely affect the profitability of a Fund. A violation of position limits","page_number":62,"box":{"x":69,"y":45,"width":837,"height":11}},{"id":"67a2ada5-6c1f-4fca-93db-469dc834fb6b","block_type":"box","text":"could also lead to regulatory action materially adverse to a Fund’s investment strategy. A Fund may also be affected","page_number":62,"box":{"x":69,"y":60,"width":827,"height":11}},{"id":"134774e9-d820-4103-a2cb-88e41efdc2b5","block_type":"box","text":"by other regimes, including those of the European Union and United Kingdom, and trading venues that impose","page_number":62,"box":{"x":69,"y":75,"width":785,"height":11}},{"id":"19b6fd64-42ca-4975-b9aa-f767587cf78c","block_type":"box","text":"position limits on commodity derivative contracts.","page_number":62,"box":{"x":70,"y":90,"width":350,"height":11}},{"id":"a7c11531-5ed6-4a2e-8bf9-8746cac0f014","block_type":"box","text":"Additional Regulation of Derivatives.","page_number":62,"box":{"x":101,"y":113,"width":256,"height":11}},{"id":"443d8b9d-8cc0-461e-91c8-33613be7e785","block_type":"box","text":"Regulatory bodies outside the U.S. have also passed, proposed, or may","page_number":62,"box":{"x":364,"y":113,"width":513,"height":11}},{"id":"8289b536-ece0-460b-abef-64af59e1037c","block_type":"box","text":"propose in the future, legislation similar to Dodd-Frank or other legislation that could increase the costs of","page_number":62,"box":{"x":70,"y":128,"width":757,"height":11}},{"id":"cd38d423-b74e-4c11-a138-3c4e722dc180","block_type":"box","text":"par ticipating in, or otherwise adversely impact the liquidity of, par ticipating in the commodities markets. For example,","page_number":62,"box":{"x":70,"y":143,"width":836,"height":11}},{"id":"bece01e8-9cb1-494e-ba46-43df132b322a","block_type":"box","text":"the European Market Infrastructure Regulation (Regulation (EU) No 648/2012) (“EMIR”) introduced cer tain","page_number":62,"box":{"x":68,"y":158,"width":762,"height":11}},{"id":"111cfc0d-be48-4936-a1d6-4a386576a805","block_type":"box","text":"requirements in respect of OTC derivatives including: (i) the mandatory clearing of OTC derivative contracts declared","page_number":62,"box":{"x":69,"y":173,"width":825,"height":11}},{"id":"72210d90-1e30-45c9-825b-9f60e4861784","block_type":"box","text":"subject to the clearing obligation; (ii) risk mitigation techniques in respect of uncleared OTC derivative contracts,","page_number":62,"box":{"x":69,"y":188,"width":798,"height":12}},{"id":"571d9147-d2c5-412e-8dd1-2ae5f94ae456","block_type":"box","text":"including the mandatory margining of uncleared OTC derivative contracts; and (iii) repor ting and recordkeeping","page_number":62,"box":{"x":70,"y":203,"width":785,"height":12}},{"id":"8f62432f-3395-4e92-b9ef-3507f256ddba","block_type":"box","text":"requirements in respect of all derivatives contracts. By way of fur ther example, the European Union Markets in","page_number":62,"box":{"x":69,"y":218,"width":787,"height":12}},{"id":"69e9fdd9-c893-4987-a50c-624b3c4eee89","block_type":"box","text":"Financial Instruments Directive (Directive 2014/65/EU) and Markets in Financial Instruments Regulation (Regulation","page_number":62,"box":{"x":70,"y":234,"width":830,"height":11}},{"id":"23981d03-d8f5-45f1-a736-f2dfb5108b8e","block_type":"box","text":"(EU) No 600/2014) (together “MiFID II”), which have applied since January 3, 2018, govern the provision of","page_number":62,"box":{"x":69,"y":249,"width":771,"height":11}},{"id":"5e2c2ee8-39fe-4850-85f3-aa6b3249ea76","block_type":"box","text":"investment services and activities in relation to, as well as the organized trading of, financial instruments such as","page_number":62,"box":{"x":70,"y":264,"width":812,"height":11}},{"id":"4319353f-c617-4e1d-99c5-60dc24d847b9","block_type":"box","text":"shares, bonds, units in collective investment schemes and derivatives. In par ticular, MiFID II requires European Union","page_number":62,"box":{"x":69,"y":279,"width":839,"height":11}},{"id":"a3a10da3-f97e-4363-8f27-7aa9b23a53f6","block_type":"box","text":"Member States to apply position limits to the size of a net position a person can hold at any time in commodity","page_number":62,"box":{"x":70,"y":294,"width":793,"height":11}},{"id":"f0b80a16-e3df-49ce-92dc-c0ac9a2465eb","block_type":"box","text":"derivatives traded on European Union trading venues and in “economically equivalent” OTC contracts. If the","page_number":62,"box":{"x":69,"y":309,"width":765,"height":11}},{"id":"fe5fd07f-91d5-4f3a-837a-b407587a3dd1","block_type":"box","text":"requirements of EMIR and MiFID II apply, the cost of derivatives transactions is expected to increase.","page_number":62,"box":{"x":69,"y":324,"width":720,"height":11}},{"id":"c278264f-390b-484d-a119-331a064e4884","block_type":"box","text":"In addition, regulations adopted by global prudential regulators that are now in effect require cer tain prudentially","page_number":62,"box":{"x":102,"y":347,"width":802,"height":11}},{"id":"aa50ddf1-e6ed-4237-91f3-bba630c3828b","block_type":"box","text":"regulated entities and cer tain of their affiliates and subsidiaries (including swap dealers) to include in their","page_number":62,"box":{"x":69,"y":362,"width":762,"height":11}},{"id":"90a899c4-92e0-4a89-b0a3-47901b5a9b3c","block_type":"box","text":"derivatives contracts and cer tain other financial contracts, terms that delay or restrict the rights of counterpar ties","page_number":62,"box":{"x":69,"y":377,"width":810,"height":12}},{"id":"800819f5-ddd4-4eb8-b122-54d5aea1ff64","block_type":"box","text":"(such as the Funds) to terminate such contracts, foreclose upon collateral, exercise other default rights or restrict","page_number":62,"box":{"x":69,"y":392,"width":812,"height":12}},{"id":"6f48fa69-e5c3-4328-a672-4600f37659ed","block_type":"box","text":"transfers of credit suppor t in the event that the prudentially regulated entity and/or its affiliates are subject to","page_number":62,"box":{"x":68,"y":407,"width":787,"height":12}},{"id":"c8d7d8e9-5c33-4806-b185-92dc3be99db3","block_type":"box","text":"cer tain types of resolution or insolvency proceedings. Similar regulations and laws have been adopted in non-U.S.","page_number":62,"box":{"x":69,"y":423,"width":810,"height":11}},{"id":"7937807c-9106-400f-9286-db9926ceb598","block_type":"box","text":"jurisdictions that may apply to a Fund’s counterpar ties located in those jurisdictions. In par ticular, in the United","page_number":62,"box":{"x":67,"y":438,"width":795,"height":11}},{"id":"35e45c5d-4d89-4956-9786-82efa0590d32","block_type":"box","text":"Kingdom and the European Union, governmental authorities could reduce, eliminate or conver t to equity the liabilities","page_number":62,"box":{"x":70,"y":453,"width":835,"height":11}},{"id":"a16cf1cb-e030-4156-b246-316735ca1531","block_type":"box","text":"to a Fund of a counterpar ty experiencing financial difficulties (sometimes referred to as a “bail in”). It is possible that","page_number":62,"box":{"x":68,"y":468,"width":839,"height":11}},{"id":"c8e3a90e-8d3d-4249-b540-ce06a07a754a","block_type":"box","text":"these requirements, as well as potential additional related government regulation, could adversely affect a Fund’s","page_number":62,"box":{"x":68,"y":483,"width":814,"height":11}},{"id":"2f048783-b7ed-4df7-a2e9-5fd99d6902cb","block_type":"box","text":"ability to terminate existing derivatives contracts, exercise default rights or satisfy obligations owed to it with","page_number":62,"box":{"x":69,"y":498,"width":773,"height":11}},{"id":"f5741edc-30ec-49d4-9421-55e46f23ad33","block_type":"box","text":"collateral received under such contracts.","page_number":62,"box":{"x":69,"y":514,"width":288,"height":8}},{"id":"2e3b15b3-ab51-4c0d-af90-7c827596977d","block_type":"box","text":"Risk Factors in Derivatives.","page_number":62,"box":{"x":102,"y":536,"width":191,"height":9}},{"id":"904f5dfe-df2c-4f7b-9038-4e9d9948f2b4","block_type":"box","text":"There are significant risks that apply generally to derivatives transactions, including:","page_number":62,"box":{"x":101,"y":559,"width":597,"height":11}},{"id":"0594e4de-54aa-4703-a165-fa8af7b22f83","block_type":"box","text":"Correlation Risk","page_number":62,"box":{"x":102,"y":581,"width":114,"height":9}},{"id":"b5593621-136f-4c39-b850-e9f63842eaee","block_type":"box","text":"— the risk that changes in the value of a derivative will not match the changes in the value of","page_number":62,"box":{"x":220,"y":581,"width":668,"height":12}},{"id":"3660282f-3633-4c9c-8be1-1dd5d9ab609d","block_type":"box","text":"the por tfolio holdings that are being hedged or of the par ticular market or security to which the Fund seeks exposure.","page_number":62,"box":{"x":68,"y":596,"width":837,"height":12}},{"id":"d3f5da94-4bb0-451c-86d8-e4f38ff1a188","block_type":"box","text":"There are a number of factors which may prevent a derivative instrument from achieving the desired correlation (or","page_number":62,"box":{"x":68,"y":612,"width":818,"height":11}},{"id":"e53b9250-885b-4aba-8a6e-4e42b8c87a2b","block_type":"box","text":"inverse correlation) with an underlying asset, rate or index, such as the impact of fees, expenses and transaction","page_number":62,"box":{"x":70,"y":627,"width":806,"height":11}},{"id":"1114d7b4-efa8-4935-9092-e6109a4da295","block_type":"box","text":"costs, the timing of pricing, and disruptions or illiquidity in the markets for such derivative instrument.","page_number":62,"box":{"x":69,"y":642,"width":725,"height":11}},{"id":"0244712a-a998-43a0-9a89-311591ecab07","block_type":"box","text":"Counterpar ty Risk","page_number":62,"box":{"x":102,"y":665,"width":128,"height":11}},{"id":"3057bb6a-2696-4b7e-836a-e9c63613f55b","block_type":"box","text":"— the risk that a derivatives transaction counterpar ty will be unable or unwilling to make","page_number":62,"box":{"x":233,"y":665,"width":632,"height":11}},{"id":"35c59737-ec1f-498d-8d19-adb0334b13cc","block_type":"box","text":"payments or otherwise honor its obligations to a Fund and the related risks of having concentrated exposure to such","page_number":62,"box":{"x":70,"y":680,"width":830,"height":11}},{"id":"a7076271-0d34-4ae2-8ac2-8d8ac3856f73","block_type":"box","text":"a counterpar ty. In par ticular, derivatives traded in OTC markets often are not guaranteed by an exchange or clearing","page_number":62,"box":{"x":69,"y":695,"width":824,"height":11}},{"id":"21ac4733-0548-4076-8b68-e7ed35c688c0","block_type":"box","text":"corporation and often do not require payment of margin, and to the extent that the Fund has unrealized gains in such","page_number":62,"box":{"x":69,"y":710,"width":834,"height":11}},{"id":"0d4dfcdb-736d-4386-99f9-ccd4532bb4ca","block_type":"box","text":"instruments or has deposited collateral with its counterpar ties the Fund is at risk that its counterpar ties will become","page_number":62,"box":{"x":70,"y":725,"width":831,"height":11}},{"id":"81c85b76-d595-4cdd-b78a-738fff481412","block_type":"box","text":"bankrupt or otherwise fail to honor their obligations. A Fund will typically attempt to minimize counterpar ty risk by","page_number":62,"box":{"x":69,"y":740,"width":806,"height":11}},{"id":"e2eae0f7-c290-469b-a067-0864c239215c","block_type":"box","text":"engaging in OTC derivatives transactions only with creditwor thy entities that have substantial capital or that have","page_number":62,"box":{"x":69,"y":755,"width":803,"height":11}},{"id":"46034c60-263b-4954-a77b-c224e1014e01","block_type":"box","text":"provided the Fund with a third-par ty guaranty or other credit suppor t. When a Fund enters into a derivatives","page_number":62,"box":{"x":70,"y":771,"width":760,"height":11}},{"id":"51d00890-d431-479d-931b-ff9fc81c61d0","block_type":"box","text":"transaction that is centrally cleared (whether mandatorily or voluntarily), the Fund is subject to the credit risk of the","page_number":62,"box":{"x":68,"y":785,"width":819,"height":12}},{"id":"d79e8b01-a69d-4410-a990-bb45235099f8","block_type":"box","text":"clearing house and the clearing member through which it holds its cleared position. Credit risk of market par ticipants","page_number":62,"box":{"x":69,"y":801,"width":834,"height":11}},{"id":"4ef24b6b-3abc-446e-8872-2c18e3c4c81e","block_type":"box","text":"with respect to derivatives that are centrally cleared is concentrated in a few clearing houses and increasingly fewer","page_number":62,"box":{"x":68,"y":816,"width":826,"height":11}},{"id":"31dded03-e80c-4ed6-8479-606d5c40e781","block_type":"box","text":"clearing members. It is not clear how an insolvency proceeding of a clearing house would be conducted and what","page_number":62,"box":{"x":69,"y":831,"width":805,"height":11}},{"id":"5c371e2d-9875-4cd2-87fb-c69501ee6db4","block_type":"box","text":"impact an insolvency of a clearing house would have on the financial system. Also, a Fund will not be fully protected","page_number":62,"box":{"x":70,"y":846,"width":824,"height":11}},{"id":"1f4af60b-8e5e-42b5-b90f-53cafa6e4a44","block_type":"box","text":"in the event of the bankruptcy of a Fund’s clearing member because the Fund would be limited to recovering only a","page_number":62,"box":{"x":70,"y":861,"width":816,"height":11}},{"id":"384dcd3f-3f6d-45b0-b440-d06429addc50","block_type":"box","text":"pro rata share of the funds held by the clearing member on behalf of customers by account class for cleared","page_number":62,"box":{"x":70,"y":876,"width":771,"height":11}},{"id":"930e036f-ab8b-429a-8cb2-fb30bf155306","block_type":"box","text":"derivatives. Although a clearing member is required to segregate assets from customers with respect to cleared","page_number":62,"box":{"x":69,"y":891,"width":797,"height":12}},{"id":"2e293f27-d4ce-43cd-a05f-0b9354d48ead","block_type":"box","text":"derivatives positions from the clearing member’s proprietary assets, if a clearing member does not comply with the","page_number":62,"box":{"x":69,"y":906,"width":822,"height":12}},{"id":"3935932d-6f6a-465c-ab86-467ef882ef5e","block_type":"box","text":"II-15","page_number":62,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"9b1d0c70-0eb4-4324-a6d8-f7d5df57c0c8","block_type":"box","text":"NM1026U-6033063-62/246","page_number":62,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"61c6b042-39f8-4026-befe-20d078d8d270","block_type":"box","text":"applicable regulations, or in the event of fraud or misappropriation of customer assets by a clearing member, a Fund","page_number":63,"box":{"x":69,"y":45,"width":829,"height":11}},{"id":"78a86167-82c5-49a7-8186-99dc383f467b","block_type":"box","text":"could have only an unsecured creditor claim in an insolvency of the clearing member with respect to the assets held","page_number":63,"box":{"x":69,"y":60,"width":827,"height":11}},{"id":"61af5a9b-ec37-4479-994c-a1eaa79e35dd","block_type":"box","text":"by the clearing member.","page_number":63,"box":{"x":69,"y":75,"width":169,"height":11}},{"id":"4612efde-744c-4550-8ed1-604ad6a585fc","block_type":"box","text":"Credit Risk","page_number":63,"box":{"x":102,"y":98,"width":78,"height":9}},{"id":"c2517a71-c294-4202-81dd-b05bb97158f8","block_type":"box","text":"— the risk that the reference entity in a credit default swap or similar derivative will not be able to","page_number":63,"box":{"x":184,"y":98,"width":698,"height":11}},{"id":"a7df1ed5-4075-4d2b-a4a3-896a6cd60d46","block_type":"box","text":"honor its financial obligations.","page_number":63,"box":{"x":69,"y":113,"width":213,"height":11}},{"id":"95d43eba-28aa-4ebf-a9b6-75a65be65dfe","block_type":"box","text":"Currency Risk","page_number":63,"box":{"x":102,"y":135,"width":98,"height":11}},{"id":"b3e548a8-e2e1-42f8-8923-fd79d0869a3f","block_type":"box","text":"— the risk that changes in the exchange rate between two currencies will adversely affect the","page_number":63,"box":{"x":204,"y":135,"width":669,"height":12}},{"id":"13b0f32a-a01a-494d-b412-c3c388bc5a9d","block_type":"box","text":"value (in U.S. dollar terms) of a derivative.","page_number":63,"box":{"x":68,"y":150,"width":300,"height":11}},{"id":"c2659452-7a3f-44b2-b9bf-08d61ebb5810","block_type":"box","text":"Illiquidity Risk","page_number":63,"box":{"x":102,"y":173,"width":98,"height":11}},{"id":"8e4dd579-b03e-48e9-ab9e-6cb22f922bfe","block_type":"box","text":"— the risk that cer tain securities or instruments may be difficult or impossible to sell at the time","page_number":63,"box":{"x":204,"y":173,"width":693,"height":11}},{"id":"fbd03ce6-294c-4f79-a17a-a98dd51caad9","block_type":"box","text":"or at the price desired by a Fund in connection with payments of margin, collateral, or settlement payments. There","page_number":63,"box":{"x":69,"y":188,"width":814,"height":12}},{"id":"ddfea29d-972d-47a8-a1b9-85aa89e6b249","block_type":"box","text":"can be no assurance that a Fund will be able to unwind or offset a derivative at its desired price, in a secondary","page_number":63,"box":{"x":69,"y":203,"width":799,"height":12}},{"id":"dc0d1029-d44a-469d-86d1-4b342e70a194","block_type":"box","text":"market or otherwise. It may, therefore, not be possible for the Fund to unwind its position in a derivative without","page_number":63,"box":{"x":69,"y":218,"width":799,"height":12}},{"id":"9dcb6578-fefa-40d0-ac27-6f1cf1e044bc","block_type":"box","text":"incurring substantial losses (if at all). Cer tain OTC derivatives, including swaps and OTC options, involve substantial","page_number":63,"box":{"x":70,"y":234,"width":824,"height":11}},{"id":"8f741837-9f06-4231-b209-24b19b9521b3","block_type":"box","text":"illiquidity risk. Illiquidity may also make it more difficult for a Fund to ascer tain a market value for such derivatives. A","page_number":63,"box":{"x":70,"y":249,"width":830,"height":11}},{"id":"66a4e9dc-1a7f-4591-af78-c9d4191b14b1","block_type":"box","text":"Fund will, therefore, acquire illiquid OTC derivatives (i) if the agreement pursuant to which the instrument is","page_number":63,"box":{"x":70,"y":264,"width":762,"height":11}},{"id":"515d9bd1-77d7-4d80-8ad8-9fc2ea81e3b2","block_type":"box","text":"purchased contains a formula price at which the instrument may be terminated or sold, or (ii) for which the Manager","page_number":63,"box":{"x":70,"y":279,"width":827,"height":11}},{"id":"c7215f66-7a52-46d9-897a-360e111b5832","block_type":"box","text":"anticipates the Fund can receive on each business day at least two independent bids or offers, unless a quotation","page_number":63,"box":{"x":69,"y":294,"width":816,"height":11}},{"id":"2f98772a-fc2c-44d4-b186-5c4f11f13a73","block_type":"box","text":"from only one dealer is available, in which case that dealer’s quotation may be used. The illiquidity of the derivatives","page_number":63,"box":{"x":68,"y":309,"width":831,"height":11}},{"id":"febbf090-5580-4e77-b9e7-21b9375f60de","block_type":"box","text":"markets may be due to various factors, including congestion, disorderly markets, limitations on deliverable supplies,","page_number":63,"box":{"x":69,"y":324,"width":828,"height":12}},{"id":"ed76b3cf-427d-40e9-ae22-48579fc0f628","block_type":"box","text":"the par ticipation of speculators, government regulation and intervention, and technical and operational or system","page_number":63,"box":{"x":68,"y":339,"width":809,"height":12}},{"id":"58470a53-caa0-418b-90b0-5eafa5b55d1c","block_type":"box","text":"failures. In addition, the liquidity of a market in an exchange-traded derivative contract may be adversely affected by","page_number":63,"box":{"x":68,"y":355,"width":826,"height":11}},{"id":"0108100b-731c-4b9f-b3cb-a67fa28893b9","block_type":"box","text":"“daily price fluctuation limits” established by the exchanges which limit the amount of fluctuation in an exchange","page_number":63,"box":{"x":70,"y":370,"width":806,"height":11}},{"id":"14202906-0a64-4100-b3e1-46a17339c7ea","block_type":"box","text":"traded contract price during a single trading day. Once the daily limit has been reached in the contract, no trades may","page_number":63,"box":{"x":68,"y":385,"width":838,"height":11}},{"id":"8ca1da33-90f2-4a8b-a636-8213b8cf229c","block_type":"box","text":"be entered into at a price beyond the limit, thus preventing the liquidation of open positions. Prices have in the past","page_number":63,"box":{"x":69,"y":400,"width":827,"height":11}},{"id":"fa9a67ce-2cf0-4bc8-85ee-3683497ccb6a","block_type":"box","text":"moved to the daily limit on a number of consecutive trading days with little to no trading. If it is not possible to close","page_number":63,"box":{"x":69,"y":415,"width":828,"height":11}},{"id":"0fd1140b-fea2-4531-a5bc-5a5141693a76","block_type":"box","text":"an open derivative position entered into by the Fund, the Fund would continue to be required to make daily cash","page_number":63,"box":{"x":69,"y":430,"width":796,"height":11}},{"id":"f4726813-3e66-4a02-a727-e7a07371dd02","block_type":"box","text":"payments of variation margin in the event of adverse price movements. In such a situation, if the Fund has","page_number":63,"box":{"x":70,"y":445,"width":759,"height":12}},{"id":"d010f860-e17b-42a8-a476-8eef2cc6d659","block_type":"box","text":"insufficient cash, it may have to sell por tfolio securities to meet daily variation margin requirements at a time when it","page_number":63,"box":{"x":70,"y":460,"width":837,"height":12}},{"id":"fd0616b1-4d0b-4607-bee5-8605e27736ec","block_type":"box","text":"may be disadvantageous to do so.","page_number":63,"box":{"x":69,"y":476,"width":243,"height":11}},{"id":"27144bb4-17c4-4337-96c1-4d5599cf0bc7","block_type":"box","text":"Index Risk","page_number":63,"box":{"x":102,"y":498,"width":73,"height":9}},{"id":"83585060-ad17-4c07-b896-7fa00741c0a0","block_type":"box","text":"— if the derivative is linked to the per formance of an index, it will be subject to the risks associated","page_number":63,"box":{"x":179,"y":498,"width":714,"height":11}},{"id":"c092f362-b566-40aa-a40d-bc0b5517ab4c","block_type":"box","text":"with changes in that index. If the index changes, the Fund could receive lower interest payments or experience a","page_number":63,"box":{"x":68,"y":513,"width":800,"height":12}},{"id":"41aa9bcd-bb78-4761-9527-e60a31870057","block_type":"box","text":"reduction in the value of the derivative to below the price that the Fund paid for such derivative.","page_number":63,"box":{"x":69,"y":528,"width":678,"height":11}},{"id":"447457a9-96f7-40dc-bed1-3cfaeb48d60b","block_type":"box","text":"Legal Risk","page_number":63,"box":{"x":102,"y":551,"width":73,"height":11}},{"id":"c4a4c472-421b-485c-a3cf-7fca588df0b1","block_type":"box","text":"— the risk of insufficient documentation, insufficient capacity or authority of counterpar ty, or legality","page_number":63,"box":{"x":179,"y":551,"width":717,"height":11}},{"id":"123c4cb8-6d2a-4020-ae6c-8b42c08ed907","block_type":"box","text":"or enforceability of a contract.","page_number":63,"box":{"x":69,"y":566,"width":211,"height":11}},{"id":"caffe154-1dd9-4143-aa08-8ecd40ff2941","block_type":"box","text":"Leverage Risk","page_number":63,"box":{"x":102,"y":589,"width":99,"height":11}},{"id":"cd314b5e-0b6f-476b-a70e-1b32819f1c47","block_type":"box","text":"— the risk that a Fund’s derivatives transactions can magnify the Fund’s gains and losses.","page_number":63,"box":{"x":205,"y":589,"width":648,"height":11}},{"id":"798cf025-2585-4d68-af5c-886744163600","block_type":"box","text":"Relatively small market movements may result in large changes in the value of a derivatives position and can result","page_number":63,"box":{"x":70,"y":604,"width":823,"height":11}},{"id":"21f76775-f76a-42bf-952f-a4a4835ae49a","block_type":"box","text":"in losses that greatly exceed the amount originally invested.","page_number":63,"box":{"x":70,"y":619,"width":425,"height":11}},{"id":"9332c760-f607-47f1-9e3d-b76fa38a379a","block_type":"box","text":"Market Risk","page_number":63,"box":{"x":102,"y":642,"width":85,"height":9}},{"id":"2471169f-7e59-4cbb-918c-f088eb3bc7da","block_type":"box","text":"— the risk that changes in the value of one or more markets or changes with respect to the value of","page_number":63,"box":{"x":191,"y":642,"width":716,"height":11}},{"id":"98960a90-86c2-4098-952d-67a4e4a3c5b8","block_type":"box","text":"the underlying asset will adversely affect the value of a derivative. In the event of an adverse movement, a Fund may","page_number":63,"box":{"x":68,"y":657,"width":833,"height":11}},{"id":"76c19ee1-fca6-447e-a74a-9953ee024727","block_type":"box","text":"be required to pay substantial additional margin to maintain its position or the Fund’s returns may be adversely","page_number":63,"box":{"x":69,"y":672,"width":794,"height":11}},{"id":"eb82caf0-232f-49b0-a3a3-f195651510a5","block_type":"box","text":"affected.","page_number":63,"box":{"x":69,"y":687,"width":62,"height":9}},{"id":"7db1d7cd-8484-4e3b-9ca8-698ff5db2a1d","block_type":"box","text":"Operational Risk","page_number":63,"box":{"x":102,"y":710,"width":117,"height":11}},{"id":"6f3eeb88-0d4b-4edf-9738-99607232d6b6","block_type":"box","text":"— the risk related to potential operational issues, including documentation issues, settlement","page_number":63,"box":{"x":223,"y":710,"width":674,"height":11}},{"id":"6f8b3070-a4cc-4571-9f6e-865bc70c1b42","block_type":"box","text":"issues, systems failures, inadequate controls and human error.","page_number":63,"box":{"x":70,"y":725,"width":451,"height":11}},{"id":"1bfb0f04-6792-445f-beb6-2fac11f047b8","block_type":"box","text":"Valuation Risk","page_number":63,"box":{"x":103,"y":748,"width":99,"height":9}},{"id":"8318ed28-4f2a-45d5-b01d-745d6052709a","block_type":"box","text":"— the risk that valuation sources for a derivative will not be readily available in the market. This is","page_number":63,"box":{"x":206,"y":748,"width":701,"height":11}},{"id":"eb0f0f78-65b3-4468-aa1a-ba5b449d0c06","block_type":"box","text":"possible especially in times of market distress, since many market par ticipants may be reluctant to purchase","page_number":63,"box":{"x":70,"y":763,"width":779,"height":11}},{"id":"8a56c208-5e48-4903-a0c8-ff877b35b6b4","block_type":"box","text":"complex instruments or quote prices for them.","page_number":63,"box":{"x":69,"y":778,"width":329,"height":11}},{"id":"4bd2a2f7-e9dc-4082-8ccc-1105889a5f20","block_type":"box","text":"Volatility Risk","page_number":63,"box":{"x":103,"y":801,"width":93,"height":11}},{"id":"489ce0d6-38af-4c17-bab0-d8105069e65f","block_type":"box","text":"— the risk that the value of derivatives will fluctuate significantly within a shor t time period.","page_number":63,"box":{"x":200,"y":801,"width":652,"height":11}},{"id":"db63c97d-c5ae-48f8-851f-b7897b1ecf3b","block_type":"box","text":"Types of Derivatives Transactions.","page_number":63,"box":{"x":103,"y":823,"width":240,"height":11}},{"id":"29889b77-d656-4b6a-a91e-da3703ccec56","block_type":"box","text":"A Fund may enter into derivatives transactions in accordance with its investment guidelines and restrictions,","page_number":63,"box":{"x":101,"y":846,"width":771,"height":11}},{"id":"378098b2-de89-484a-8c5f-fd4dec7a66da","block_type":"box","text":"including the following:","page_number":63,"box":{"x":70,"y":861,"width":159,"height":11}},{"id":"d25e6f54-4c1b-4285-8b68-860ee17f57bc","block_type":"box","text":"Futures.","page_number":63,"box":{"x":102,"y":884,"width":56,"height":9}},{"id":"a2bc1a02-c51f-4f78-b51c-60c2053f8292","block_type":"box","text":"II-16","page_number":63,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"72f01e99-835c-4555-9eb5-9dba3781a0f1","block_type":"box","text":"NM1026U-6033063-63/246","page_number":63,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"9fe537ef-cfce-4b56-95b7-2d6797d171de","block_type":"box","text":"A Fund may enter into futures contracts (“futures”) and options on futures contracts. Futures are standardized,","page_number":64,"box":{"x":101,"y":45,"width":791,"height":11}},{"id":"b6080863-7e60-44b1-b5ea-1bd9ab10dbdb","block_type":"box","text":"exchange-traded contracts that require a purchaser to take delivery, and a seller to make delivery, of a specified","page_number":64,"box":{"x":69,"y":60,"width":799,"height":11}},{"id":"ef59107f-a209-4ac3-b227-43faded80e05","block_type":"box","text":"amount of an asset at a specified future date and price. Upon purchasing or selling a futures contract, a Fund is","page_number":64,"box":{"x":69,"y":75,"width":800,"height":11}},{"id":"bb7110d9-eb70-4031-9489-557ad3fe0875","block_type":"box","text":"required to deposit initial margin equal to a percentage of the contract value. Futures contracts are marked to market","page_number":64,"box":{"x":69,"y":90,"width":838,"height":11}},{"id":"28e189bd-69c2-478c-909f-bc60d30ed1cb","block_type":"box","text":"daily for the duration of the contract, and the Fund will either post additional margin or be entitled to a payment, as","page_number":64,"box":{"x":69,"y":105,"width":820,"height":11}},{"id":"f6744d06-11e1-416d-9a64-f914ff312587","block_type":"box","text":"applicable, based on the mark-to-market movement of the contract.","page_number":64,"box":{"x":69,"y":120,"width":478,"height":11}},{"id":"5a78cd2f-4efb-428c-8468-deadf2fbecff","block_type":"box","text":"A Fund may sell a futures contract prior to the completion of its term to limit its risk of loss from a decline in the","page_number":64,"box":{"x":101,"y":143,"width":801,"height":11}},{"id":"fa0fffe4-b2de-4914-945c-aeb9a3e479a4","block_type":"box","text":"market value of por tfolio holdings correlated with the futures contract. However, in the event the market value of the","page_number":64,"box":{"x":69,"y":158,"width":829,"height":11}},{"id":"87d31b98-badf-4aed-b15c-b005a4b6a13d","block_type":"box","text":"por tfolio holdings correlated with the futures contract increases rather than decreases, a Fund will realize a loss on","page_number":64,"box":{"x":70,"y":173,"width":822,"height":11}},{"id":"2ecec32c-ddf8-49a3-a89c-5267472c2ea8","block_type":"box","text":"the futures position and a lower return on the por tfolio holdings than would have been realized without the purchase","page_number":64,"box":{"x":68,"y":188,"width":830,"height":12}},{"id":"f6e69754-a6d8-432c-a1a7-7c38af7beacc","block_type":"box","text":"of the futures contract.","page_number":64,"box":{"x":69,"y":203,"width":162,"height":9}},{"id":"e12a5904-f1dd-4691-9e09-336abd576320","block_type":"box","text":"The purchase of a futures contract may provide a Fund a lower cost alternative to purchasing securities or","page_number":64,"box":{"x":101,"y":226,"width":756,"height":11}},{"id":"bb1aee04-2987-4314-8f8b-6b94fb8f120c","block_type":"box","text":"commodities directly. In the event that such securities or commodities decline in value or a Fund determines not to","page_number":64,"box":{"x":69,"y":241,"width":820,"height":11}},{"id":"99b6297b-69f0-4a70-93bd-bf3f1ff13def","block_type":"box","text":"complete an anticipatory hedge transaction relating to a futures contract, however, the Fund may realize a loss","page_number":64,"box":{"x":69,"y":256,"width":789,"height":12}},{"id":"dd370a60-b08e-411d-ae1a-64defa47db04","block_type":"box","text":"relating to the futures position.","page_number":64,"box":{"x":69,"y":271,"width":219,"height":12}},{"id":"3ed63f72-9f0e-432e-b636-3c86783e936b","block_type":"box","text":"Futures contracts are also subject to position limits. In order to comply with position limits, a Fund may be","page_number":64,"box":{"x":102,"y":294,"width":757,"height":11}},{"id":"923390e0-27c2-4b33-8831-011e2f9477ff","block_type":"box","text":"required to liquidate positions or may not be able to fully implement trading instructions. Any such liquidation or","page_number":64,"box":{"x":69,"y":309,"width":797,"height":11}},{"id":"923e0796-4f52-41e7-b610-f83cb198a844","block_type":"box","text":"limited implementation could result in substantial costs to a Fund. See “—Regulation of Derivatives — Dodd-Frank","page_number":64,"box":{"x":70,"y":324,"width":816,"height":12}},{"id":"3781b69e-0a20-4c93-ae71-3c67be4008c6","block_type":"box","text":"Regulations” above.","page_number":64,"box":{"x":70,"y":340,"width":140,"height":11}},{"id":"f75878bb-f77c-4d3c-a4e3-fade15a0caa9","block_type":"box","text":"A Fund is also permitted to purchase or sell call and put options on futures contracts, including financial futures","page_number":64,"box":{"x":101,"y":362,"width":799,"height":11}},{"id":"1b9cc9cb-8f94-4a2e-a576-3f5f0e252786","block_type":"box","text":"and stock indices. Generally, these strategies would be used under the same market and market sector conditions","page_number":64,"box":{"x":69,"y":377,"width":818,"height":12}},{"id":"90e4ede3-5b37-4cbb-bf42-e3596e39beef","block_type":"box","text":"(","page_number":64,"box":{"x":69,"y":393,"width":3,"height":10}},{"id":"278e330a-c13a-4f8b-b9c0-8ad16b5da2cc","block_type":"box","text":"i.e.","page_number":64,"box":{"x":74,"y":393,"width":21,"height":8}},{"id":"5cbc908b-04b8-4942-9930-91721d5c0d29","block_type":"box","text":", conditions relating to specific types of investments) in which the Fund entered into futures transactions. A Fund","page_number":64,"box":{"x":97,"y":392,"width":803,"height":12}},{"id":"3ebdfade-1ae8-4560-afbe-83f9d8a06395","block_type":"box","text":"may purchase put options or write call options on futures contracts and stock indices in lieu of selling the underlying","page_number":64,"box":{"x":69,"y":407,"width":830,"height":12}},{"id":"e41b053a-d019-41e0-a139-09009fa986d6","block_type":"box","text":"futures contract in anticipation of a decrease in the market value of its securities. Similarly, a Fund can purchase call","page_number":64,"box":{"x":68,"y":423,"width":835,"height":11}},{"id":"e7f0df3e-13bd-4589-925e-e23e741671bf","block_type":"box","text":"options, or write put options on futures contracts and stock indices, as a substitute for the purchase of such futures","page_number":64,"box":{"x":69,"y":438,"width":831,"height":11}},{"id":"5e045a25-e336-438a-b0b1-d41de3a49eb8","block_type":"box","text":"contracts to hedge against the increased cost resulting from an increase in the market value of securities which the","page_number":64,"box":{"x":69,"y":453,"width":826,"height":11}},{"id":"9840e513-6a8f-4c5e-91ca-7ef1f2b55622","block_type":"box","text":"Fund intends to purchase.","page_number":64,"box":{"x":70,"y":468,"width":183,"height":11}},{"id":"f52dde7f-7536-407b-bf00-e3132e7e6435","block_type":"box","text":"To maintain greater flexibility, a Fund may invest in instruments which have characteristics similar to futures","page_number":64,"box":{"x":101,"y":491,"width":768,"height":11}},{"id":"51433221-d7c8-4c73-9132-7e8ec5601736","block_type":"box","text":"contracts. These instruments may take a variety of forms, such as debt securities with interest or principal payments","page_number":64,"box":{"x":69,"y":506,"width":835,"height":11}},{"id":"d2c75f62-da8d-42e5-8a5b-0555e54133e5","block_type":"box","text":"determined by reference to the value of a security, an index of securities or a commodity at a future point in time. The","page_number":64,"box":{"x":69,"y":521,"width":839,"height":11}},{"id":"fd0c5e68-2382-4f6e-ad31-b027c8d08f47","block_type":"box","text":"risks of such investments could reflect the risks of investing in futures and securities, including volatility and","page_number":64,"box":{"x":69,"y":536,"width":773,"height":11}},{"id":"e1d95052-670d-4dd4-a1f9-18c782322036","block_type":"box","text":"illiquidity.","page_number":64,"box":{"x":70,"y":551,"width":63,"height":11}},{"id":"7f0364e5-34f3-4c84-87a7-51a059e342d0","block_type":"box","text":"Futures contracts and options on futures contracts are subject to significant correlation risk, leverage risk,","page_number":64,"box":{"x":102,"y":574,"width":757,"height":11}},{"id":"9297051d-4f63-43d7-bdff-4e1afd0437b5","block_type":"box","text":"illiquidity risk, market risk and counterpar ty risk with respect to a Fund’s futures broker or the clearinghouse. See","page_number":64,"box":{"x":70,"y":589,"width":807,"height":11}},{"id":"9a6417b1-6e09-4284-a735-2629bfa4abeb","block_type":"box","text":"“—Risk Factors in Derivatives” above.","page_number":64,"box":{"x":70,"y":604,"width":269,"height":9}},{"id":"8c333506-c496-4ae1-8c32-0a517dbca609","block_type":"box","text":"Cer tain Funds may invest in futures based on carbon “allowances.” Under cer tain regulatory regimes, a limit is","page_number":64,"box":{"x":102,"y":627,"width":791,"height":11}},{"id":"123b04e4-dba8-432c-8942-174aa74976b7","block_type":"box","text":"set by a regulator, such as a government entity, on the total amount of specific greenhouse gases, such as CO2, that","page_number":64,"box":{"x":69,"y":642,"width":838,"height":11}},{"id":"acfe9b49-5f19-41ba-8bc9-fcb433818256","block_type":"box","text":"can be emitted by regulated entities, such as manufacturers or energy producers. The regulator then may issue or","page_number":64,"box":{"x":69,"y":657,"width":814,"height":11}},{"id":"4bbfc14d-accd-4d69-bc19-fa465bd82bd8","block_type":"box","text":"sell individual “emission allowances” to regulated entities, which can then be traded on the open market. Commodity","page_number":64,"box":{"x":69,"y":672,"width":837,"height":11}},{"id":"af15b5eb-3687-4f7c-8016-2bd28a0e07ec","block_type":"box","text":"futures contracts linked to the value of emission allowances are known as “carbon futures.”","page_number":64,"box":{"x":68,"y":687,"width":657,"height":9}},{"id":"46e4ddcb-4faa-4b67-a8b2-791cb37561be","block_type":"box","text":"The price for carbon futures contracts is based on a number of factors, including the supply of and the demand","page_number":64,"box":{"x":101,"y":710,"width":792,"height":11}},{"id":"c0e9a0c8-7810-4da7-bf3e-b2b65537faea","block_type":"box","text":"for carbon futures contracts. Changes in law, market conditions and expectations, position limits, collateral","page_number":64,"box":{"x":68,"y":725,"width":764,"height":11}},{"id":"2981f5e0-2d02-4289-a26a-8ed37df12faf","block_type":"box","text":"requirements, and other factors each can impact the supply of and demand for carbon futures contracts. The market","page_number":64,"box":{"x":69,"y":740,"width":832,"height":11}},{"id":"3548705e-aac6-4165-bb4d-b8c6dada65ec","block_type":"box","text":"for carbon futures contracts is still developing and may be subject to periods of illiquidity. During such times it may be","page_number":64,"box":{"x":68,"y":755,"width":841,"height":11}},{"id":"2d68f93b-75d3-4c9f-a00f-9535677bd13d","block_type":"box","text":"difficult or impossible to buy or sell a position at the desired price. Market disruptions or volatility can also make it","page_number":64,"box":{"x":69,"y":770,"width":819,"height":11}},{"id":"d599f197-5703-40c6-977c-b0b9a3cc40fd","block_type":"box","text":"difficult to find a counterpar ty willing to transact at a reasonable price and sufficient size.","page_number":64,"box":{"x":69,"y":785,"width":637,"height":12}},{"id":"0e2b89a1-fe00-48fd-8bac-5c0e83e1b7cf","block_type":"box","text":"Swap Agreements.","page_number":64,"box":{"x":102,"y":808,"width":131,"height":11}},{"id":"3b08183d-6e6e-479a-94e8-012d62b18c9b","block_type":"box","text":"A Fund may enter into swap agreements for hedging purposes or speculative purposes. Swap agreements are","page_number":64,"box":{"x":101,"y":831,"width":782,"height":11}},{"id":"08a73fb4-8278-442f-abb5-d61452f6db74","block_type":"box","text":"OTC contracts entered into primarily by financial institutions and institutional investors which may or may not be","page_number":64,"box":{"x":69,"y":846,"width":796,"height":11}},{"id":"2c685891-98e4-4ff8-bf29-f9e5335916d9","block_type":"box","text":"cleared by a central clearinghouse. In a standard “swap” transaction, two par ties agree to exchange the returns","page_number":64,"box":{"x":69,"y":861,"width":799,"height":11}},{"id":"759acc2d-7d3c-49d8-b348-b13b15694554","block_type":"box","text":"earned or realized from one or more underlying assets or rates of return, which may be adjusted for an interest","page_number":64,"box":{"x":69,"y":876,"width":792,"height":11}},{"id":"3b5a4486-f5c6-4120-9273-d6038d96b58e","block_type":"box","text":"factor. The gross returns to be exchanged or “swapped” between the par ties are generally calculated with respect to","page_number":64,"box":{"x":68,"y":891,"width":832,"height":12}},{"id":"d5239526-53a9-4243-80da-5b84d218969f","block_type":"box","text":"a “notional amount,”","page_number":64,"box":{"x":69,"y":907,"width":147,"height":10}},{"id":"19ed94c5-f03e-43d2-b6ca-fb266ce35555","block_type":"box","text":"e.g.","page_number":64,"box":{"x":223,"y":908,"width":25,"height":10}},{"id":"98f4db12-def0-413b-a75e-6ca79cd84a67","block_type":"box","text":", the return or increase in value of a par ticular dollar amount invested at a par ticular","page_number":64,"box":{"x":251,"y":906,"width":602,"height":11}},{"id":"cc5cf698-d33d-4e57-8602-761c2a546e92","block_type":"box","text":"II-17","page_number":64,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"42fd2d74-9b86-43fe-8331-875e53155d56","block_type":"box","text":"NM1026U-6033063-64/246","page_number":64,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"dd079771-3b26-4704-b756-c0e486a62f3f","block_type":"box","text":"interest rate, in a par ticular foreign currency, or in a “basket” of securities representing a par ticular index. The","page_number":65,"box":{"x":70,"y":45,"width":787,"height":11}},{"id":"6fdff5d3-8e48-4da1-9bbb-988c51273c12","block_type":"box","text":"notional amount of the swap agreement is only used to calculate the obligations that the par ties to a swap","page_number":65,"box":{"x":69,"y":60,"width":762,"height":11}},{"id":"18718284-aeca-4f71-b10c-c5470277c7ec","block_type":"box","text":"agreement have agreed to exchange. A Fund’s obligations (or rights) under a swap agreement will generally be equal","page_number":65,"box":{"x":69,"y":75,"width":828,"height":11}},{"id":"71bb3361-1a2e-4773-8944-159eb9ca2fec","block_type":"box","text":"only to the net amount to be paid or received under the agreement based on the relative values of the positions held","page_number":65,"box":{"x":69,"y":90,"width":832,"height":11}},{"id":"4cb4fcf5-4e31-4238-80ed-bb6770458beb","block_type":"box","text":"by each par ty to the agreement. Swaps that are not cleared involve substantial counterpar ty risk. A Fund will typically","page_number":65,"box":{"x":69,"y":105,"width":835,"height":11}},{"id":"901663c3-e432-40f3-af3e-e3aaef82be20","block_type":"box","text":"attempt to mitigate this counterpar ty risk by entering into swap agreements only with creditwor thy entities that have","page_number":65,"box":{"x":69,"y":120,"width":826,"height":12}},{"id":"f7ba8548-ec96-4aa6-9e7c-166204bb49e1","block_type":"box","text":"substantial capital or that have provided the Fund with a third-par ty guaranty or other credit suppor t. A Fund’s ability","page_number":65,"box":{"x":69,"y":136,"width":827,"height":11}},{"id":"41d4d056-d786-4d53-8229-97a60c639e1b","block_type":"box","text":"to use swap agreements may be restricted by the tax rules applicable to registered investment companies.","page_number":65,"box":{"x":68,"y":151,"width":763,"height":11}},{"id":"182cddcf-bf6f-48d8-9ba6-936a3b906b06","block_type":"box","text":"Credit Default Swaps and Similar Instruments.","page_number":65,"box":{"x":102,"y":173,"width":329,"height":11}},{"id":"56801500-935b-4b26-9c14-9f83d3c519b2","block_type":"box","text":"Cer tain Funds may enter into credit default swaps and similar","page_number":65,"box":{"x":438,"y":173,"width":439,"height":11}},{"id":"55ee8509-97b1-41b1-b3e6-4722db947009","block_type":"box","text":"instruments. Credit default swaps are standardized agreements in which the protection “buyer” pays the protection","page_number":65,"box":{"x":70,"y":188,"width":821,"height":12}},{"id":"8b629db1-4dcc-4c41-be8a-46def261d5d8","block_type":"box","text":"“seller” an up-front payment, or a periodic stream of payments, over the term of the contract, provided generally that","page_number":65,"box":{"x":70,"y":203,"width":831,"height":12}},{"id":"30e0ce3a-f0b0-4169-b8df-f56188fb2937","block_type":"box","text":"no credit event on a reference obligation has occurred. If a credit event occurs, the seller generally must pay the","page_number":65,"box":{"x":69,"y":218,"width":801,"height":12}},{"id":"c49f0634-5920-490f-a064-01f303869f62","block_type":"box","text":"buyer the difference between the notional amount of the contract and the value of a por tfolio of securities issued by","page_number":65,"box":{"x":69,"y":234,"width":829,"height":11}},{"id":"65eac962-a878-495e-bda6-ac2ed2d0b35d","block_type":"box","text":"the reference entity. A Fund may be either the buyer or seller in the transaction. The Funds may enter into credit","page_number":65,"box":{"x":68,"y":249,"width":798,"height":11}},{"id":"df5f0a28-40ff-4c6f-9cda-09f4a5308448","block_type":"box","text":"default swaps that reference the obligations of a single entity (“single-name CDS”) or the obligations of entities that","page_number":65,"box":{"x":69,"y":264,"width":827,"height":11}},{"id":"2ed70b6a-ddc9-4a72-ae14-4ae7a83d55a7","block_type":"box","text":"make up an index (“index CDS”). References to “credit default swaps” shall collectively refer to single-name CDS and","page_number":65,"box":{"x":69,"y":279,"width":836,"height":11}},{"id":"f495b0b8-b7cb-4e0f-a07d-df392818ba34","block_type":"box","text":"index CDS.","page_number":65,"box":{"x":70,"y":294,"width":75,"height":9}},{"id":"ca73ea1d-dbe4-48a6-b5fb-df46198d01cf","block_type":"box","text":"Credit default swaps have as reference obligations one or more securities or loans that are not currently held by","page_number":65,"box":{"x":102,"y":317,"width":800,"height":11}},{"id":"bd007487-8b8c-4305-bd40-2f05d314c9db","block_type":"box","text":"a Fund. In circumstances in which a Fund does not own the securities or loans that are deliverable under a credit","page_number":65,"box":{"x":69,"y":332,"width":806,"height":9}},{"id":"efa50b18-43b6-4153-97f6-d1f9d7fe1d95","block_type":"box","text":"default swap, the Fund is exposed to the risk that deliverable securities will not be available in the market, or will be","page_number":65,"box":{"x":69,"y":347,"width":828,"height":11}},{"id":"bf8acd0d-1092-4e3f-bf56-6b939c559b23","block_type":"box","text":"available only at unfavorable prices, as would be the case in a so-called “shor t squeeze.” In cer tain instances of","page_number":65,"box":{"x":69,"y":362,"width":804,"height":11}},{"id":"03b6742f-5764-46c4-95ae-2c252436ed5d","block_type":"box","text":"issuer defaults or restructurings, it has been unclear under the standard industry documentation for credit default","page_number":65,"box":{"x":70,"y":377,"width":812,"height":12}},{"id":"0eae8c5d-be1d-443b-9d17-13ecba6fe0c4","block_type":"box","text":"swaps whether or not a “credit event” triggering the seller’s payment obligation had occurred. Cer tain initiatives","page_number":65,"box":{"x":69,"y":392,"width":798,"height":12}},{"id":"203df028-168f-416a-972b-16377a783ba1","block_type":"box","text":"adopted by derivatives market par ticipants, including the International Swaps and Derivatives Association (“ISDA”),","page_number":65,"box":{"x":69,"y":408,"width":819,"height":11}},{"id":"32774cce-8eeb-409c-9ecf-e9789e058ec1","block_type":"box","text":"are designed to implement uniform settlement terms into standard credit default swap documentation, as well as","page_number":65,"box":{"x":69,"y":423,"width":810,"height":11}},{"id":"f9f96b8b-315a-42f6-aad7-2ae0a3e5b184","block_type":"box","text":"refine the practices for the transparent conduct of the credit default swap market generally. Among these initiatives","page_number":65,"box":{"x":69,"y":438,"width":821,"height":11}},{"id":"02fc7219-b674-40e1-aefa-77d9aff8891a","block_type":"box","text":"are the ISDA Credit Derivatives Determination Committee and the implementation of market-wide cash settlement","page_number":65,"box":{"x":69,"y":453,"width":811,"height":11}},{"id":"9853050f-a5fa-4402-8ed0-1063bbe31cbc","block_type":"box","text":"protocols applicable to all market-standard credit default swaps. These initiatives are intended to reduce both the","page_number":65,"box":{"x":70,"y":468,"width":809,"height":11}},{"id":"009be2e8-c431-4e61-b786-d9151cdb82d7","block_type":"box","text":"uncer tainty as to the occurrence of credit events and the risk of a “shor t squeeze” by providing that the ISDA Credit","page_number":65,"box":{"x":69,"y":483,"width":827,"height":11}},{"id":"78eea5cc-19f2-40f7-abe4-faf0fcbc5e25","block_type":"box","text":"Derivatives Determinations Committee will make determinations as to whether a credit event has occurred, establish","page_number":65,"box":{"x":70,"y":498,"width":834,"height":11}},{"id":"01ead347-599e-4895-af5d-70b0277617e0","block_type":"box","text":"an auction to determine a settlement price and identify the deliverable securities for purposes of the auction,","page_number":65,"box":{"x":69,"y":513,"width":778,"height":11}},{"id":"3484fb49-6104-4f14-a2a2-5de81778f3ef","block_type":"box","text":"although the ISDA Credit Derivatives Determinations Committee may in cer tain limited circumstances refrain from","page_number":65,"box":{"x":69,"y":528,"width":809,"height":12}},{"id":"46eeb7a1-038b-412f-bde3-523b19153784","block_type":"box","text":"doing so. In the event the ISDA Credit Derivatives Determinations Committee cannot reach a timely resolution with","page_number":65,"box":{"x":69,"y":544,"width":815,"height":11}},{"id":"853cb76f-6762-4707-aba7-2632125c07f1","block_type":"box","text":"respect to a “credit event” or otherwise does not establish a cash settlement auction, a Fund may not be able to","page_number":65,"box":{"x":69,"y":559,"width":807,"height":11}},{"id":"14f2fa41-680e-4404-b99c-74aaa4f54e74","block_type":"box","text":"realize the full value of the credit default swap upon a default by the reference entity. Fur thermore, a Fund may enter","page_number":65,"box":{"x":69,"y":574,"width":832,"height":11}},{"id":"7f894805-71b4-4ded-85a7-9e6ec44aac39","block_type":"box","text":"into cer tain credit default swaps or similar instruments that may not be covered by these initiatives.","page_number":65,"box":{"x":70,"y":589,"width":711,"height":11}},{"id":"6cffbe4b-4f91-46b3-83b3-07167a5774bc","block_type":"box","text":"If a Fund is a buyer, it will lose the payments made under the terms of the credit default swap and recover","page_number":65,"box":{"x":102,"y":612,"width":757,"height":11}},{"id":"01428ca8-1325-4914-9939-f0bb8f1d0c5d","block_type":"box","text":"nothing should no credit event occur. If a Fund is a seller and a credit event occurs, the value of any deliverable","page_number":65,"box":{"x":69,"y":627,"width":794,"height":11}},{"id":"a53b2339-9d6c-4d5e-a5c6-1d592bbd0ed6","block_type":"box","text":"obligation received by the Fund or the amount of cash settlement received by the Fund pursuant to the relevant cash","page_number":65,"box":{"x":69,"y":642,"width":830,"height":11}},{"id":"30593765-4db7-44e6-934f-a686384aa92d","block_type":"box","text":"settlement auction, together with the up-front or periodic payments previously received, may be less than the amount","page_number":65,"box":{"x":69,"y":657,"width":835,"height":11}},{"id":"9ded64f7-593d-42ca-9e99-857c94a9ea5c","block_type":"box","text":"it pays to the buyer, resulting in a loss of value to the Fund. A Fund that sells credit default swaps incurs leveraged","page_number":65,"box":{"x":70,"y":672,"width":817,"height":11}},{"id":"adfe9723-9c09-4e60-b299-6db7bd13b890","block_type":"box","text":"exposure to the credit of one or more reference entities and is subject to many of the same risks it would incur if it","page_number":65,"box":{"x":69,"y":687,"width":820,"height":11}},{"id":"03a8ffcc-4e64-4975-bf5b-f09183ade631","block_type":"box","text":"were holding debt securities issued by the relevant reference entity. However, a Fund will not have any legal recourse","page_number":65,"box":{"x":68,"y":702,"width":833,"height":12}},{"id":"1e84692e-da72-4032-94ba-0f8129375e7c","block_type":"box","text":"against any reference entity and will not benefit from any collateral securing the reference entity’s debt obligations. In","page_number":65,"box":{"x":69,"y":717,"width":837,"height":12}},{"id":"5f4c6d21-4b69-4c52-a796-476dedec1718","block_type":"box","text":"the event the ISDA Credit Derivatives Determinations Committee does not establish a cash settlement auction and","page_number":65,"box":{"x":68,"y":733,"width":820,"height":9}},{"id":"a22f6fb2-7f32-440a-baca-73a0147977a3","block_type":"box","text":"identify the relevant deliverable securities or loans, the credit default swap buyer will have broad discretion to select","page_number":65,"box":{"x":70,"y":748,"width":828,"height":11}},{"id":"836d0e5b-afc9-4a5b-9a91-d1c2b47b9d71","block_type":"box","text":"which of the reference entity’s debt obligations to deliver to the Fund following a credit event and will likely choose","page_number":65,"box":{"x":68,"y":763,"width":815,"height":11}},{"id":"46fc4b8e-5e4a-4e25-b7db-8d7e36809c1e","block_type":"box","text":"the obligations with the lowest market value in order to maximize the payment obligations of the Fund. In addition,","page_number":65,"box":{"x":68,"y":778,"width":814,"height":11}},{"id":"58ec1313-ea9a-46df-83ba-d8f27e2ada03","block_type":"box","text":"credit default swaps generally trade on the basis of theoretical pricing and valuation models, which may not","page_number":65,"box":{"x":69,"y":793,"width":766,"height":11}},{"id":"ff3e0281-f03b-49fc-ad7e-ea20299b477c","block_type":"box","text":"accurately value such swap positions when established or when subsequently traded or unwound under actual market","page_number":65,"box":{"x":69,"y":808,"width":840,"height":11}},{"id":"cb8c132a-5fdc-47b0-8b5f-644043eb5eb2","block_type":"box","text":"conditions.","page_number":65,"box":{"x":69,"y":823,"width":76,"height":9}},{"id":"b3b5e61c-b3bd-4d25-9ef2-13254e9f6293","block_type":"box","text":"Dodd-Frank requires that cer tain index CDS be executed in regulated markets and submitted for clearing to","page_number":65,"box":{"x":102,"y":846,"width":762,"height":11}},{"id":"44b31c13-3953-4a27-bc1b-52e4f99949e7","block_type":"box","text":"regulated clearinghouses. See “—Derivatives — Regulation of Derivatives — Dodd-Frank Regulations” above. Other","page_number":65,"box":{"x":69,"y":861,"width":824,"height":11}},{"id":"d0649c81-c028-4c77-9fdb-6510abbd8884","block_type":"box","text":"single-name CDS and index CDS are permitted, although not required, to be cleared through regulated","page_number":65,"box":{"x":69,"y":876,"width":727,"height":11}},{"id":"4af1552b-d757-4ac0-862c-2648d5d946d2","block_type":"box","text":"clearinghouses. The Funds clear all credit default swaps that are subject to mandatory clearing and may voluntarily","page_number":65,"box":{"x":69,"y":891,"width":819,"height":12}},{"id":"77110d57-e618-4f1e-b5e7-6d57376066b0","block_type":"box","text":"clear some, but not all, of the other credit default swaps not subject to mandatory clearing. The Funds face","page_number":65,"box":{"x":69,"y":906,"width":764,"height":12}},{"id":"c70fd418-39fd-47cb-aa01-542649c607ba","block_type":"box","text":"II-18","page_number":65,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"ad8a6bce-3a78-45e0-a929-2921a341ff0c","block_type":"box","text":"NM1026U-6033063-65/246","page_number":65,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"ce765c52-4a10-4e64-ba55-8f735991d7d1","block_type":"box","text":"counterpar ty risk with respect to the clearinghouse when entering into cleared single-name CDS and cleared index","page_number":66,"box":{"x":69,"y":45,"width":813,"height":11}},{"id":"1e85312a-9593-4e6e-a5d8-b49c03eb4b01","block_type":"box","text":"CDS. The Funds face significant counterpar ty risk with respect to their counterpar ties to non-cleared credit default","page_number":66,"box":{"x":69,"y":60,"width":813,"height":11}},{"id":"000dd647-4b3f-48a2-98c8-fb5b6f393ac1","block_type":"box","text":"swaps and similar instruments. A Fund typically will enter into non-cleared credit default swaps and similar","page_number":66,"box":{"x":69,"y":75,"width":759,"height":11}},{"id":"135b6391-bfa2-4618-b333-dcec12be24fe","block_type":"box","text":"instruments with swap dealers and creditwor thy entities that have substantial capital or that have provided the Fund","page_number":66,"box":{"x":70,"y":90,"width":828,"height":11}},{"id":"93d208ba-b312-4676-a216-031c307a1366","block_type":"box","text":"with a third-par ty guaranty or other credit suppor t.","page_number":66,"box":{"x":68,"y":105,"width":355,"height":11}},{"id":"8512c691-3324-4cfa-9088-e58aaa0d0d8a","block_type":"box","text":"In cer tain instances, a Fund may enter into bespoke credit default swaps or similar instruments either as","page_number":66,"box":{"x":102,"y":128,"width":750,"height":11}},{"id":"c6628764-a613-4776-8530-6fe0d5756730","block_type":"box","text":"protection buyer or protection seller. While these contracts are similar in their operation to the market-standard credit","page_number":66,"box":{"x":70,"y":143,"width":836,"height":11}},{"id":"052c952e-a1c8-43c0-8747-e2666db4e53b","block_type":"box","text":"default swaps described above, they are less standardized and instead have bespoke or tailored features. For","page_number":66,"box":{"x":69,"y":158,"width":785,"height":11}},{"id":"de051e71-a157-42db-ae66-d82f8fb1ce69","block_type":"box","text":"example, as compared to market-standard credit defaults, the range of “credit events” triggering settlement of such","page_number":66,"box":{"x":69,"y":173,"width":825,"height":11}},{"id":"5524cbd2-df55-41dc-b6f5-43a5b3b4d8f9","block_type":"box","text":"bespoke contracts may be narrower or broader, any such triggered contracts are settled by physical delivery of the","page_number":66,"box":{"x":69,"y":188,"width":814,"height":12}},{"id":"662c1d57-3ebc-4db3-8b16-dcc27a2b3dde","block_type":"box","text":"underlying security or loan to or by the Fund rather than by way of cash settlement, and there may be a wider range of","page_number":66,"box":{"x":69,"y":203,"width":839,"height":12}},{"id":"eeeb9b94-076e-4da9-885f-409af91b47c7","block_type":"box","text":"securities as the reference obligations and/or deliverable obligations.","page_number":66,"box":{"x":69,"y":218,"width":495,"height":12}},{"id":"2672e6ce-3309-415e-939a-8c4a8a993290","block_type":"box","text":"In addition, credit default swaps and similar instruments generally involve greater risks than if a Fund had","page_number":66,"box":{"x":102,"y":241,"width":752,"height":11}},{"id":"8776e343-476c-4cd8-8516-2b7cd8aa034f","block_type":"box","text":"invested in the reference obligation directly and are subject to significant credit risk, correlation risk, leverage risk,","page_number":66,"box":{"x":70,"y":256,"width":814,"height":12}},{"id":"e17451a4-1d43-4322-b02d-9b73ac6e0005","block_type":"box","text":"illiquidity risk and market risk. See “—Risk Factors in Derivatives” above.","page_number":66,"box":{"x":70,"y":272,"width":520,"height":11}},{"id":"a91e45b0-4e9e-4407-86dc-95086a4b8808","block_type":"box","text":"Interest Rate Swaps, Floors and Caps.","page_number":66,"box":{"x":102,"y":294,"width":273,"height":11}},{"id":"4807308e-7464-4b2f-ae13-50ff265dad90","block_type":"box","text":"Cer tain Funds may enter into OTC derivatives in the form of interest rate","page_number":66,"box":{"x":381,"y":294,"width":515,"height":11}},{"id":"2387cf97-0f5e-4fa0-9d73-fff39b2c9c49","block_type":"box","text":"swaps and interest rate caps and floors. As described in fur ther detail below, a Fund may enter into these","page_number":66,"box":{"x":69,"y":309,"width":755,"height":11}},{"id":"f60f4f7b-4057-4ff9-ac06-9a87b70f2ead","block_type":"box","text":"transactions primarily to preserve a return or spread on a par ticular investment or por tion of its holdings, as a","page_number":66,"box":{"x":68,"y":324,"width":788,"height":12}},{"id":"04c3436b-97dc-4702-9cf0-f7b5113d839f","block_type":"box","text":"duration management technique, to protect against an increase in the price of securities a Fund anticipates","page_number":66,"box":{"x":69,"y":339,"width":768,"height":12}},{"id":"100392ab-4775-4ba9-81ab-c8c6079e640d","block_type":"box","text":"purchasing at a later date, or for speculation to increase returns.","page_number":66,"box":{"x":70,"y":355,"width":461,"height":11}},{"id":"32db7421-89e0-4047-a8fb-1895c27cd2f3","block_type":"box","text":"Dodd-Frank requires that cer tain interest rate swaps be executed in regulated markets and submitted for","page_number":66,"box":{"x":102,"y":377,"width":748,"height":12}},{"id":"d187de87-8637-4311-ae6c-61a876499592","block_type":"box","text":"clearing to regulated clearinghouses. See “—Regulation of Derivatives — Dodd-Frank Regulations” above. Other","page_number":66,"box":{"x":69,"y":392,"width":799,"height":12}},{"id":"4607f0e5-4f6a-49dd-9dc7-2ccefd0bd7a9","block_type":"box","text":"interest rate swaps are permitted, although not required, to be cleared. Most of the interest rate swaps entered into","page_number":66,"box":{"x":70,"y":407,"width":829,"height":12}},{"id":"9901de73-1023-4c17-b08c-3a8f86e9d7ab","block_type":"box","text":"by the Funds are cleared. The Funds face counterpar ty risk with respect to the clearinghouse when entering into","page_number":66,"box":{"x":69,"y":423,"width":797,"height":11}},{"id":"fe2fa70c-dcfe-40ba-8920-d97f8ff531e4","block_type":"box","text":"cleared interest rate swaps.","page_number":66,"box":{"x":69,"y":438,"width":198,"height":11}},{"id":"e2d34169-30d2-4123-b01f-0110d71aa504","block_type":"box","text":"The Funds face significant counterpar ty risk with respect to their counterpar ties to non-cleared interest rate","page_number":66,"box":{"x":101,"y":460,"width":766,"height":12}},{"id":"58ff684a-7fde-470d-89d9-6ab513effbc5","block_type":"box","text":"swaps and interest rate caps and floors. The typical counterpar ties for a Fund’s non-cleared interest rate derivatives","page_number":66,"box":{"x":69,"y":475,"width":829,"height":12}},{"id":"f4faf53c-2f6e-4854-8792-d1bd513dd2f5","block_type":"box","text":"transactions are swap dealers and other creditwor thy entities that have substantial capital or that have provided the","page_number":66,"box":{"x":68,"y":491,"width":830,"height":11}},{"id":"f07f6d63-88db-481b-8c75-eb180a5da7b8","block_type":"box","text":"Fund with a third-par ty guaranty or other credit suppor t. If the Fund’s counterpar ty defaults on such a transaction, a","page_number":66,"box":{"x":70,"y":506,"width":822,"height":11}},{"id":"03e2b093-884b-4abc-a1fc-8334550f3ca8","block_type":"box","text":"Fund will have contractual remedies with respect to the transaction but there can be no guarantee that the Fund will","page_number":66,"box":{"x":70,"y":521,"width":824,"height":11}},{"id":"15b980b0-912d-4cc6-be86-13b3b6f085bb","block_type":"box","text":"be successful in enforcing such remedies. The market for interest rate swaps is relatively liquid in comparison with","page_number":66,"box":{"x":69,"y":536,"width":819,"height":11}},{"id":"74a8f37f-ed86-4e1e-96f6-a6a89a3cde72","block_type":"box","text":"other similar instruments traded in the interbank market. A Fund may be limited in its ability to enter into cer tain","page_number":66,"box":{"x":69,"y":551,"width":801,"height":11}},{"id":"05a473f4-7c55-4335-9d03-2e69e4aa35b5","block_type":"box","text":"interest rate derivatives due to applicable income tax requirements.","page_number":66,"box":{"x":70,"y":566,"width":480,"height":11}},{"id":"758f1a44-63d4-496d-9549-ff4c5cdb26fc","block_type":"box","text":"Interest rate swaps are transactions in which each par ty makes periodic interest payments based on a fixed or","page_number":66,"box":{"x":102,"y":589,"width":790,"height":11}},{"id":"0284feb8-51ff-4068-bbdf-d8ce69fb4ab9","block_type":"box","text":"variable interest rate, index or asset in return for periodic payments from its counterpar ty based on a different fixed","page_number":66,"box":{"x":68,"y":604,"width":825,"height":11}},{"id":"01259490-437b-46ec-8b83-0aec95295b4e","block_type":"box","text":"or variable interest rate, index or asset.","page_number":66,"box":{"x":69,"y":619,"width":280,"height":11}},{"id":"862b854c-7ae3-4cb7-8f5a-e1ad5cd78e0b","block_type":"box","text":"The purchase of an interest rate floor entitles the purchaser, to the extent that a specified index falls below a","page_number":66,"box":{"x":101,"y":642,"width":780,"height":11}},{"id":"8b7d45ba-2f2e-4cce-8dfc-f5878a4f3b1d","block_type":"box","text":"predetermined interest rate, to receive payments of interest on a notional principal amount from the par ty selling","page_number":66,"box":{"x":70,"y":657,"width":805,"height":11}},{"id":"54f58285-a838-4aaf-9c1d-0e2e992d9d86","block_type":"box","text":"such interest rate floor.","page_number":66,"box":{"x":69,"y":672,"width":165,"height":9}},{"id":"9b56e9d9-0d38-4c5c-9d3b-bda93f085ceb","block_type":"box","text":"The purchase of an interest rate cap entitles the purchaser, to the extent that a specified index rises above a","page_number":66,"box":{"x":101,"y":695,"width":780,"height":11}},{"id":"98ab9546-5fe1-41d3-969d-ee0e69abedf7","block_type":"box","text":"predetermined interest rate, to receive payments of interest on a notional principal amount from the par ty selling","page_number":66,"box":{"x":70,"y":710,"width":805,"height":11}},{"id":"e7cd1262-331a-4614-9815-b1e2318665ae","block_type":"box","text":"such interest rate cap.","page_number":66,"box":{"x":69,"y":725,"width":159,"height":11}},{"id":"99008954-051b-4d0a-b537-ccb83ca13376","block_type":"box","text":"A Fund may enter into an interest rate swap to effectively exchange with another par ty their respective","page_number":66,"box":{"x":101,"y":748,"width":729,"height":11}},{"id":"73f285aa-4e0d-44de-88c1-ff486601951a","block_type":"box","text":"commitments to pay or receive interest,","page_number":66,"box":{"x":69,"y":763,"width":282,"height":11}},{"id":"b7c55e88-6b10-4857-9190-6be88ef19e00","block_type":"box","text":"e.g.","page_number":66,"box":{"x":359,"y":764,"width":24,"height":10}},{"id":"51ab168e-2098-42ec-9afb-830ae08d40a0","block_type":"box","text":", an exchange of fixed rate payments for floating rate payments. For","page_number":66,"box":{"x":386,"y":763,"width":482,"height":11}},{"id":"78b800f5-f0b7-42c5-8148-5c44b6578b0f","block_type":"box","text":"example, if a Fund holds a mor tgage-backed security with an interest rate that is reset only once each year, it may","page_number":66,"box":{"x":69,"y":778,"width":814,"height":11}},{"id":"713c09a2-8dc1-4406-aff8-077e8af5429c","block_type":"box","text":"swap the right to receive interest at this fixed rate for the right to receive interest at a rate that is reset every week.","page_number":66,"box":{"x":69,"y":793,"width":823,"height":11}},{"id":"26f42a03-f501-4563-ad1a-4fb416bdcea6","block_type":"box","text":"This would enable a Fund to offset a decline in the value of the mor tgage-backed security due to rising interest rates","page_number":66,"box":{"x":68,"y":808,"width":832,"height":11}},{"id":"9177eae2-4df9-40ab-9b8a-415ac8ad5b44","block_type":"box","text":"but would also limit its ability to benefit from falling interest rates. Conversely, if a Fund holds a mor tgage-backed","page_number":66,"box":{"x":69,"y":823,"width":807,"height":12}},{"id":"7268b174-663a-44b5-84bd-33b060c8827d","block_type":"box","text":"security with an interest rate that is reset every week and it would like to lock in what it believes to be a high interest","page_number":66,"box":{"x":69,"y":839,"width":836,"height":11}},{"id":"a0fc6171-01d6-4422-aa0e-aa8df52a74a5","block_type":"box","text":"rate for one year, it may swap the right to receive interest at this variable weekly rate for the right to receive interest","page_number":66,"box":{"x":69,"y":853,"width":826,"height":12}},{"id":"fc3bcf4c-91ae-480d-9219-e0307847a008","block_type":"box","text":"at a rate that is fixed for one year. Such a swap would protect the Fund from a reduction in yield due to falling interest","page_number":66,"box":{"x":69,"y":869,"width":840,"height":11}},{"id":"23b26f5a-80c9-43b3-a334-a8aa451877b1","block_type":"box","text":"rates and may permit the Fund to enhance its income through the positive differential between one week and one","page_number":66,"box":{"x":69,"y":884,"width":810,"height":11}},{"id":"3ba077fe-5c3a-46d4-95f5-b1a20acb3a13","block_type":"box","text":"year interest rates, but would preclude it from taking full advantage of rising interest rates.","page_number":66,"box":{"x":68,"y":899,"width":646,"height":11}},{"id":"52e6e36e-7863-4dd0-9b29-da63ab2f31f8","block_type":"box","text":"II-19","page_number":66,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"bbd72790-0e06-4c34-a077-7470ba1a8b7d","block_type":"box","text":"NM1026U-6033063-66/246","page_number":66,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"00068ff6-0b1e-47e5-bfe4-53056648f033","block_type":"box","text":"Gains from transactions in interest rate swaps distributed to shareholders will be taxable as ordinary income or,","page_number":67,"box":{"x":102,"y":45,"width":798,"height":11}},{"id":"a36e26a0-97c1-46b9-9254-63ca70ffa6b7","block_type":"box","text":"in cer tain circumstances, as long term capital gains to shareholders.","page_number":67,"box":{"x":70,"y":60,"width":490,"height":11}},{"id":"d7a1da34-8924-4733-9be7-8a396b09f076","block_type":"box","text":"Interest rate swaps and interest rate caps and floors may be subject to correlation risk, leverage risk, illiquidity","page_number":67,"box":{"x":102,"y":82,"width":791,"height":12}},{"id":"92619249-d4c6-49e5-a101-e87b5a0c6979","block_type":"box","text":"risk and market risk. See “—Risk Factors in Derivatives” above.","page_number":67,"box":{"x":69,"y":98,"width":454,"height":9}},{"id":"3d6eed15-9dfb-4109-a420-399e82896b88","block_type":"box","text":"Total Return Swaps.","page_number":67,"box":{"x":103,"y":120,"width":139,"height":11}},{"id":"e31b607a-cdc5-46e6-a887-bc0368e336ea","block_type":"box","text":"Total return swaps are contracts in which one par ty agrees to make periodic payments to","page_number":67,"box":{"x":249,"y":120,"width":634,"height":12}},{"id":"1e22253a-0944-40c4-9bff-efe3d91d1ff1","block_type":"box","text":"the other par ty based on the return of the assets underlying the contract in exchange for periodic payments based on","page_number":67,"box":{"x":68,"y":135,"width":838,"height":12}},{"id":"90e9edeb-4930-41de-b1d4-57e243d93dd0","block_type":"box","text":"a fixed or variable interest rate or the total return from different underlying assets. The return of the assets","page_number":67,"box":{"x":69,"y":150,"width":764,"height":12}},{"id":"5309bf27-5245-43f7-af99-9c4baa8135e9","block_type":"box","text":"underlying the contract includes both the income generated by the asset and the change in market value of the","page_number":67,"box":{"x":69,"y":166,"width":791,"height":11}},{"id":"c7c4ce7f-8a9c-44fa-9ec1-0335ca361654","block_type":"box","text":"asset. The asset underlying the contract may include a specified security, basket of securities or securities indices.","page_number":67,"box":{"x":69,"y":181,"width":821,"height":11}},{"id":"8e69ff7f-1df5-4d6e-a7aa-d7ba4f0bc704","block_type":"box","text":"Total return swaps on a specified security, basket of securities or securities indices may sometimes be referred to as","page_number":67,"box":{"x":68,"y":196,"width":838,"height":11}},{"id":"6c673a4d-7c28-4348-90b2-f6310848a761","block_type":"box","text":"“contracts for difference.”","page_number":67,"box":{"x":70,"y":211,"width":184,"height":9}},{"id":"0d40e2f9-8091-43fb-b329-f76461073011","block_type":"box","text":"Total return swaps may be used to obtain exposure to a security or market without owning or taking physical","page_number":67,"box":{"x":101,"y":234,"width":770,"height":11}},{"id":"0c6d6f93-73c2-4643-9fe4-08d7479e6edd","block_type":"box","text":"custody of such security or investing directly in such market. Upon entering into a total return swap, a Fund is","page_number":67,"box":{"x":69,"y":249,"width":780,"height":11}},{"id":"d7574740-ed65-4978-a385-b3e41b810345","block_type":"box","text":"required to deposit initial margin but the par ties do not exchange the notional amount. As a result, total return swaps","page_number":67,"box":{"x":69,"y":264,"width":839,"height":11}},{"id":"aae84447-6997-49fb-afc0-2959377cfa7f","block_type":"box","text":"may effectively add leverage to the Fund’s por tfolio because the Fund would be subject to investment exposure on","page_number":67,"box":{"x":69,"y":279,"width":816,"height":11}},{"id":"b2eec6f6-c277-432e-97da-417a624ebc7d","block_type":"box","text":"the notional amount of the swap.","page_number":67,"box":{"x":68,"y":294,"width":235,"height":11}},{"id":"4530ec53-2217-4f80-b0b5-f5d87f1a56ef","block_type":"box","text":"Total return swaps are subject to significant correlation risk, leverage risk, illiquidity risk, market risk and","page_number":67,"box":{"x":101,"y":317,"width":746,"height":11}},{"id":"748d55b9-25e6-4f93-8b9e-c6658db16c55","block_type":"box","text":"counterpar ty risk. See “—Risk Factors in Derivatives” above.","page_number":67,"box":{"x":69,"y":332,"width":433,"height":11}},{"id":"181fd107-a1d3-481b-bd44-c3711c0462be","block_type":"box","text":"Options.","page_number":67,"box":{"x":102,"y":355,"width":57,"height":11}},{"id":"3739be96-bf04-4530-97a3-8209178609ec","block_type":"box","text":"Options on Securities and Securities Indices.","page_number":67,"box":{"x":102,"y":377,"width":319,"height":11}},{"id":"60a03f09-f653-4bc0-8cdc-4ea44daecf30","block_type":"box","text":"A Fund may engage in transactions in options on individual","page_number":67,"box":{"x":427,"y":377,"width":418,"height":12}},{"id":"b3c62746-6315-441e-88ce-49c6e0faec1a","block_type":"box","text":"securities, baskets of securities or securities indices, or par ticular measurements of value or rates, such as an index","page_number":67,"box":{"x":69,"y":392,"width":838,"height":11}},{"id":"d75c1c27-85c9-41ff-94a6-802a4de3c383","block_type":"box","text":"of the price of treasury securities or an index representative of shor t-term interest rates. Such investments may be","page_number":67,"box":{"x":69,"y":407,"width":820,"height":12}},{"id":"22b53dda-1208-4b29-982e-361d7800168d","block_type":"box","text":"made on exchanges and in the OTC markets. In general, exchange-traded options have standardized exercise prices","page_number":67,"box":{"x":69,"y":423,"width":826,"height":11}},{"id":"2ddd280c-f007-45cb-8e09-ae22c6f024ca","block_type":"box","text":"and expiration dates and require the par ties to post margin against their obligations, and the per formance of the","page_number":67,"box":{"x":69,"y":438,"width":806,"height":11}},{"id":"fb565468-a9ac-4bf8-9287-ab535f4dd841","block_type":"box","text":"par ties’ obligations in connection with such options is guaranteed by the exchange or a related clearing corporation.","page_number":67,"box":{"x":70,"y":453,"width":825,"height":11}},{"id":"4b15f203-5d61-4b2c-a627-c98a2555cafb","block_type":"box","text":"OTC options have more flexible terms negotiated between the buyer and the seller, but are subject to greater credit","page_number":67,"box":{"x":69,"y":468,"width":822,"height":11}},{"id":"494a0933-d5e2-41cb-b63a-ad9ea6431f02","block_type":"box","text":"risk. OTC options also involve greater illiquidity risk.","page_number":67,"box":{"x":69,"y":483,"width":366,"height":11}},{"id":"82739247-f0b9-4bcd-9698-640a6e8e7672","block_type":"box","text":"A Fund may also engage in transactions in options which have additional features that result in different","page_number":67,"box":{"x":101,"y":506,"width":743,"height":11}},{"id":"05c8009c-6548-4375-98ef-7a9f9435ab64","block_type":"box","text":"payment structures and/or expirations (commonly referred to as exotic options). For example, barrier options are","page_number":67,"box":{"x":70,"y":521,"width":804,"height":11}},{"id":"19e37972-8977-499a-a1d4-58a853b874db","block_type":"box","text":"exotic options that can only be exercised (or automatically expire) if the price of the underlying asset reaches one or","page_number":67,"box":{"x":69,"y":536,"width":827,"height":11}},{"id":"d7ba38c5-9b51-49c7-9081-275216e60376","block_type":"box","text":"more predetermined levels on or before expiration. Binary options are another example of exotic options which have","page_number":67,"box":{"x":69,"y":551,"width":827,"height":11}},{"id":"4e84e944-b787-472c-acb3-0c92663273fe","block_type":"box","text":"a fixed all-or-nothing payout if one or more predetermined conditions are met. Exotic options are typically traded in","page_number":67,"box":{"x":69,"y":566,"width":812,"height":11}},{"id":"f2c14725-cd44-4a7e-b2ca-6fb70306671b","block_type":"box","text":"OTC markets.","page_number":67,"box":{"x":69,"y":581,"width":95,"height":9}},{"id":"8e558583-3b8d-40b4-aefc-b12a66c345e6","block_type":"box","text":"There are several risks associated with transactions in options on securities and indexes. For example, there are","page_number":67,"box":{"x":101,"y":604,"width":806,"height":11}},{"id":"1a3704c0-a3a7-47ba-8d3e-a63dcbf0a083","block_type":"box","text":"significant differences between the securities and options markets that could result in an imper fect correlation","page_number":67,"box":{"x":69,"y":619,"width":791,"height":11}},{"id":"c531ae43-8194-4819-a625-2938827b2342","block_type":"box","text":"between these markets, causing a given transaction not to achieve its objectives. In addition, a liquid market for","page_number":67,"box":{"x":69,"y":634,"width":801,"height":12}},{"id":"232b3eee-6ef9-40b1-acf4-fb79499e4f9a","block_type":"box","text":"par ticular options, whether traded OTC or on a national securities exchange (“Exchange”) may be absent for reasons","page_number":67,"box":{"x":70,"y":649,"width":831,"height":12}},{"id":"e65dd14b-8de7-4f4b-85b8-ee8f35b0fbaa","block_type":"box","text":"which include the following: there may be insufficient trading interest in cer tain options; restrictions may be imposed","page_number":67,"box":{"x":68,"y":664,"width":833,"height":12}},{"id":"64197856-f0f6-4e7a-8b66-b739dc9f67fe","block_type":"box","text":"by an Exchange on opening transactions or closing transactions or both; trading halts, suspensions or other","page_number":67,"box":{"x":69,"y":680,"width":769,"height":11}},{"id":"33242ebb-f561-435c-bf47-fc607626ebcb","block_type":"box","text":"restrictions may be imposed with respect to par ticular classes or series of options or underlying securities; unusual","page_number":67,"box":{"x":69,"y":695,"width":824,"height":11}},{"id":"8e0d623b-0879-4612-922b-e99665986311","block_type":"box","text":"or unforeseen circumstances may interrupt normal operations on an Exchange; the facilities of an Exchange or the","page_number":67,"box":{"x":69,"y":710,"width":816,"height":11}},{"id":"c1126504-b154-47f0-a142-6cbebf9907b2","block_type":"box","text":"Options Clearing Corporation may not at all times be adequate to handle current trading volume; or one or more","page_number":67,"box":{"x":69,"y":725,"width":796,"height":11}},{"id":"bf00ff72-4726-4894-b0d5-a89da16bdc38","block_type":"box","text":"Exchanges could, for economic or other reasons, decide or be compelled at some future date to discontinue the","page_number":67,"box":{"x":70,"y":740,"width":798,"height":11}},{"id":"5ffd4638-209e-4474-90bd-206ee548d8a2","block_type":"box","text":"trading of options (or a par ticular class or series of options), in which event the market on that Exchange (or in that","page_number":67,"box":{"x":68,"y":755,"width":822,"height":11}},{"id":"687a7916-a276-4cac-8f68-4a812df3aa3a","block_type":"box","text":"class or series of options) would cease to exist, although outstanding options that had been issued by the Options","page_number":67,"box":{"x":69,"y":770,"width":818,"height":12}},{"id":"f5524464-ad82-43bf-9736-bf4bf2167e44","block_type":"box","text":"Clearing Corporation as a result of trades on that Exchange would continue to be exercisable in accordance with their","page_number":67,"box":{"x":69,"y":785,"width":836,"height":12}},{"id":"bd138115-9863-44fa-b129-2f60a42f620c","block_type":"box","text":"terms.","page_number":67,"box":{"x":68,"y":801,"width":45,"height":9}},{"id":"5749d824-e45d-4d32-b20c-d598f2c52510","block_type":"box","text":"Each of the options exchanges has established limitations governing the maximum number of call or put options","page_number":67,"box":{"x":102,"y":823,"width":801,"height":12}},{"id":"b1428824-15fa-417e-9a7d-3b2f449f5fef","block_type":"box","text":"on the same asset that may be bought or written by a single investor, whether acting alone or in concer t with others","page_number":67,"box":{"x":69,"y":839,"width":826,"height":11}},{"id":"6314e65d-ed83-4dba-b1bd-c42bbcf1abe9","block_type":"box","text":"(regardless of whether such options are written on the same or different exchanges or are held or written on one or","page_number":67,"box":{"x":69,"y":853,"width":823,"height":12}},{"id":"d2099db6-1130-46ca-b8ae-442a2ced894d","block_type":"box","text":"more accounts or through one or more brokers). Under these limitations, option positions of all investment","page_number":67,"box":{"x":69,"y":869,"width":762,"height":11}},{"id":"b3b91257-e3c9-4c96-b6e4-f33571b8a163","block_type":"box","text":"companies advised by the Manager are combined for purposes of these limits. Pursuant to these limitations, an","page_number":67,"box":{"x":69,"y":884,"width":798,"height":11}},{"id":"e5d0e4f7-cfe2-422c-a70f-0cbd4de13a11","block_type":"box","text":"II-20","page_number":67,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"f1aaa34f-5e26-431c-a72a-84ef61ddd175","block_type":"box","text":"NM1026U-6033063-67/246","page_number":67,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"063e675e-da23-4970-91d4-f58586179ad5","block_type":"box","text":"exchange may order the liquidation of positions and may impose other sanctions or restrictions. These position limits","page_number":68,"box":{"x":69,"y":45,"width":837,"height":11}},{"id":"767514b3-03cb-4a94-a30c-a1428f334cdf","block_type":"box","text":"may restrict the number of listed options that a Fund may buy or sell.","page_number":68,"box":{"x":69,"y":60,"width":491,"height":11}},{"id":"78b2d8ed-b12e-4696-9c66-a889739718ce","block_type":"box","text":"Call Options.","page_number":68,"box":{"x":102,"y":83,"width":89,"height":10}},{"id":"cc67a1c7-d098-41be-b968-336284196734","block_type":"box","text":"A Fund may purchase call options on any of the types of securities or instruments in which it may","page_number":68,"box":{"x":197,"y":82,"width":694,"height":12}},{"id":"63d3a185-6e07-4a9b-9502-50b526fd432a","block_type":"box","text":"invest. A purchased call option gives a Fund the right to buy, and obligates the seller to sell, the underlying security at","page_number":68,"box":{"x":70,"y":98,"width":838,"height":11}},{"id":"0535d69e-8f95-4845-9e7f-15470f7f6bd2","block_type":"box","text":"the exercise price at any time during the option period. A Fund also may purchase and sell call options on indices.","page_number":68,"box":{"x":68,"y":113,"width":813,"height":11}},{"id":"b3b6fe52-7e60-4875-a362-4d216fa3eb38","block_type":"box","text":"Index options are similar to options on securities except that, rather than taking or making delivery of securities","page_number":68,"box":{"x":70,"y":128,"width":795,"height":11}},{"id":"65c88e3f-3352-4026-9758-90a06f762a86","block_type":"box","text":"underlying the option at a specified price upon exercise, an index option gives the holder the right to receive cash","page_number":68,"box":{"x":69,"y":143,"width":807,"height":11}},{"id":"155e3960-b22b-4f9c-aa64-ee19ce836420","block_type":"box","text":"upon exercise of the option if the level of the index upon which the option is based is greater than the exercise price","page_number":68,"box":{"x":69,"y":158,"width":830,"height":11}},{"id":"5b5acd7e-dd84-4232-a33a-a6bd7041ddbd","block_type":"box","text":"of the option.","page_number":68,"box":{"x":69,"y":173,"width":93,"height":11}},{"id":"38958fb1-3be4-4873-a94b-8d7b78f4244a","block_type":"box","text":"A written call option is covered if a Fund holds a call on the same security or index as the call written where the","page_number":68,"box":{"x":101,"y":196,"width":794,"height":11}},{"id":"ef4b7253-d1ad-4f21-91b1-ea3bb69bbaf6","block_type":"box","text":"exercise price of the call held is (i) equal to or less than the exercise price of the call written, or (ii) greater than the","page_number":68,"box":{"x":69,"y":211,"width":823,"height":11}},{"id":"601bd1d8-5378-49b3-9ce6-40579bc363e0","block_type":"box","text":"exercise price of the call written provided the difference is maintained by the Fund in assets which are not considered","page_number":68,"box":{"x":69,"y":226,"width":839,"height":11}},{"id":"5194f37a-bfe7-43f6-88c1-67c50fb106f8","block_type":"box","text":"illiquid investments under the Funds’ Liquidity Program (as defined below) (“liquid assets”) designated on the","page_number":68,"box":{"x":70,"y":241,"width":778,"height":11}},{"id":"a7adac3f-77f4-44b5-b8d3-d6abdd9245de","block_type":"box","text":"Manager’s or the sub-adviser’s books and records to the extent required by Commission guidelines.","page_number":68,"box":{"x":70,"y":256,"width":711,"height":12}},{"id":"9201ffb8-2af8-4d33-ac03-1c2ab67d24db","block_type":"box","text":"A Fund may write (","page_number":68,"box":{"x":101,"y":279,"width":130,"height":11}},{"id":"3c258626-8e92-42e1-a2df-0c20b2cb62cd","block_type":"box","text":"i.e.","page_number":68,"box":{"x":233,"y":279,"width":20,"height":9}},{"id":"29d37ef3-a153-42e3-9ad0-f2c4f5cfd80a","block_type":"box","text":", sell) covered call options on the securities or instruments in which it may invest and to","page_number":68,"box":{"x":256,"y":279,"width":627,"height":11}},{"id":"39a37dd1-0b7f-4691-86d6-c73deb98937e","block_type":"box","text":"enter into closing purchase transactions with respect to cer tain of such options. A covered call option is an option in","page_number":68,"box":{"x":69,"y":294,"width":831,"height":11}},{"id":"41f50d89-40f4-4486-8b61-ef49ac9b671d","block_type":"box","text":"which a Fund, in return for a premium, gives another par ty a right to buy specified securities owned by the Fund at a","page_number":68,"box":{"x":68,"y":309,"width":827,"height":11}},{"id":"b2e8f9fb-1062-4922-8c9f-430daed84518","block_type":"box","text":"specified future date and price set at the time of the contract. The principal reason for writing call options is the","page_number":68,"box":{"x":69,"y":324,"width":797,"height":12}},{"id":"356570a1-1438-4fd0-957b-927d7ddfc30a","block_type":"box","text":"attempt to realize, through the receipt of premiums, a greater return than would be realized on the securities alone.","page_number":68,"box":{"x":69,"y":339,"width":823,"height":12}},{"id":"40ad9b62-d9a0-48ec-87e5-e35b67dab4da","block_type":"box","text":"By writing covered call options, a Fund gives up the oppor tunity, while the option is in effect, to profit from any price","page_number":68,"box":{"x":70,"y":355,"width":823,"height":11}},{"id":"0cd6671b-bb76-4683-bd14-8b268448f785","block_type":"box","text":"increase in the underlying security above the option exercise price. In addition, a Fund’s ability to sell the underlying","page_number":68,"box":{"x":70,"y":370,"width":825,"height":11}},{"id":"dab7e442-17c7-4738-bec6-4ff131a698e5","block_type":"box","text":"security will be limited while the option is in effect unless the Fund enters into a closing purchase transaction. A","page_number":68,"box":{"x":69,"y":385,"width":800,"height":11}},{"id":"bab771cd-9673-4883-8b26-55128090c382","block_type":"box","text":"closing purchase transaction cancels out a Fund’s position as the writer of an option by means of an offsetting","page_number":68,"box":{"x":69,"y":400,"width":792,"height":11}},{"id":"3eac2caf-d6a0-4e53-bd0d-f0f049ea86f5","block_type":"box","text":"purchase of an identical option prior to the expiration of the option it has written. Covered call options also serve as","page_number":68,"box":{"x":70,"y":415,"width":826,"height":11}},{"id":"631c66a2-721b-4e22-a287-8f3eaa175090","block_type":"box","text":"a par tial hedge to the extent of the premium received against the price of the underlying security declining.","page_number":68,"box":{"x":69,"y":430,"width":760,"height":11}},{"id":"8c2007c8-7ed6-4b29-b387-e80113571730","block_type":"box","text":"A Fund may write","page_number":68,"box":{"x":101,"y":453,"width":120,"height":11}},{"id":"a12112d0-7046-47a7-be2b-a592d9b71063","block_type":"box","text":"(i.e.","page_number":68,"box":{"x":228,"y":453,"width":25,"height":11}},{"id":"ada3f105-1ca9-4f81-b3c5-ba2c96a80532","block_type":"box","text":", sell) uncovered call options on securities or instruments in which it may invest but that","page_number":68,"box":{"x":256,"y":453,"width":628,"height":11}},{"id":"6efbf41f-547c-4b2e-bb28-960646118775","block_type":"box","text":"are not currently held by the Fund. The principal reason for writing uncovered call options is to realize income without","page_number":68,"box":{"x":69,"y":468,"width":834,"height":11}},{"id":"95685579-72c2-4e08-a854-e2be3ae61a5e","block_type":"box","text":"committing capital to the ownership of the underlying securities or instruments. When writing uncovered call options,","page_number":68,"box":{"x":69,"y":483,"width":830,"height":11}},{"id":"bf1a1534-a9cd-4756-85f7-c2acd8590f12","block_type":"box","text":"a Fund must deposit and maintain sufficient margin with the broker-dealer through which it made the uncovered call","page_number":68,"box":{"x":69,"y":498,"width":825,"height":11}},{"id":"bb4aff15-ce8b-402d-857c-664f2dee509a","block_type":"box","text":"option as collateral to ensure that the securities can be purchased for delivery if and when the option is exercised.","page_number":68,"box":{"x":69,"y":513,"width":818,"height":11}},{"id":"05ed608c-fc5a-4468-a37c-40e723e20047","block_type":"box","text":"During periods of declining securities prices or when prices are stable, writing uncovered calls can be a profitable","page_number":68,"box":{"x":70,"y":528,"width":806,"height":12}},{"id":"6bea82be-b6ed-4149-a089-bb20ecad417d","block_type":"box","text":"strategy to increase a Fund’s income with minimal capital risk. Uncovered calls are riskier than covered calls because","page_number":68,"box":{"x":69,"y":544,"width":839,"height":11}},{"id":"51d0d998-47c5-4a1c-a9e9-edf1a6993b09","block_type":"box","text":"there is no underlying security held by a Fund that can act as a par tial hedge. Uncovered calls have speculative","page_number":68,"box":{"x":68,"y":559,"width":793,"height":11}},{"id":"99c7b943-cf28-4289-8939-cdee6946b6e0","block_type":"box","text":"characteristics and the potential for loss is unlimited. When an uncovered call is exercised, a Fund must purchase","page_number":68,"box":{"x":69,"y":574,"width":814,"height":11}},{"id":"53e1bf63-3f98-4cf5-9e24-32cba341afe1","block_type":"box","text":"the underlying security to meet its call obligation. There is also a risk, especially with preferred and debt securities","page_number":68,"box":{"x":68,"y":589,"width":818,"height":11}},{"id":"294b90e5-c4ad-4beb-926e-00baeca0556c","block_type":"box","text":"that lack sufficient liquidity, that the securities may not be available for purchase. If the purchase price exceeds the","page_number":68,"box":{"x":68,"y":604,"width":825,"height":11}},{"id":"c43d0572-c752-4002-8e27-701850d976be","block_type":"box","text":"exercise price, a Fund will lose the difference.","page_number":68,"box":{"x":69,"y":619,"width":326,"height":11}},{"id":"e7d35929-01f9-4f53-8f77-05bc093eba6d","block_type":"box","text":"Put Options.","page_number":68,"box":{"x":102,"y":642,"width":85,"height":11}},{"id":"e39b2884-4cb6-4a80-ac81-b47ff539bd3a","block_type":"box","text":"A Fund may purchase put options to seek to hedge against a decline in the value of its securities or","page_number":68,"box":{"x":194,"y":642,"width":712,"height":11}},{"id":"0c79474c-eb8d-4f12-be44-14c7ddd6fa50","block_type":"box","text":"to enhance its return. By buying a put option, a Fund acquires a right to sell the underlying securities or instruments","page_number":68,"box":{"x":68,"y":657,"width":828,"height":11}},{"id":"853dde79-5ac0-41bb-a10d-15706d657040","block_type":"box","text":"at the exercise price, thus limiting the Fund’s risk of loss through a decline in the market value of the securities or","page_number":68,"box":{"x":69,"y":672,"width":816,"height":11}},{"id":"ecda8f35-95c6-407e-9fb2-7a3069c9a1a7","block_type":"box","text":"instruments until the put option expires. The amount of any appreciation in the value of the underlying securities or","page_number":68,"box":{"x":70,"y":687,"width":820,"height":11}},{"id":"e8c0d26d-9dc4-4cac-8ef4-110bc233bf49","block_type":"box","text":"instruments will be par tially offset by the amount of the premium paid for the put option and any related transaction","page_number":68,"box":{"x":70,"y":702,"width":826,"height":11}},{"id":"f7bcfb54-5da3-4032-864f-c8187f30ef46","block_type":"box","text":"costs. Prior to its expiration, a put option may be sold in a closing sale transaction and profit or loss from the sale","page_number":68,"box":{"x":69,"y":717,"width":815,"height":12}},{"id":"a7806d33-c04f-4b40-9924-f3fb7e39ffa5","block_type":"box","text":"will depend on whether the amount received is more or less than the premium paid for the put option plus the related","page_number":68,"box":{"x":68,"y":732,"width":839,"height":11}},{"id":"6731496a-df0e-4915-ae6f-1affdde1d5f5","block_type":"box","text":"transaction costs. A closing sale transaction cancels out a Fund’s position as the purchaser of an option by means of","page_number":68,"box":{"x":68,"y":748,"width":841,"height":11}},{"id":"22f35a8e-dee2-4961-a911-6a1f891076f5","block_type":"box","text":"an offsetting sale of an identical option prior to the expiration of the option it has purchased. A Fund also may","page_number":68,"box":{"x":69,"y":763,"width":785,"height":11}},{"id":"18c941cd-6c4d-420d-9dd2-000a6ebedf62","block_type":"box","text":"purchase uncovered put options.","page_number":68,"box":{"x":70,"y":778,"width":231,"height":11}},{"id":"4fdb83f6-742b-49ae-923a-55d58d9af6be","block_type":"box","text":"A Fund also may write (","page_number":68,"box":{"x":101,"y":801,"width":165,"height":11}},{"id":"222a4d43-e0d5-441a-8297-a30b1ec490cc","block_type":"box","text":"i.e.","page_number":68,"box":{"x":268,"y":801,"width":20,"height":9}},{"id":"40e683ad-503f-4bc8-af99-cacd88f42c18","block_type":"box","text":", sell) put options on the types of securities or instruments that may be held by the","page_number":68,"box":{"x":291,"y":801,"width":591,"height":11}},{"id":"81d593d4-24cd-4fd5-b1ab-3314c97bf74e","block_type":"box","text":"Fund. A Fund will receive a premium for writing a put option, which increases the Fund’s return.","page_number":68,"box":{"x":70,"y":816,"width":675,"height":11}},{"id":"1000eab7-c27c-4671-a577-206f5333bfe9","block_type":"box","text":"A Fund also may write (","page_number":68,"box":{"x":101,"y":839,"width":165,"height":10}},{"id":"91d322e9-a352-4c74-85ce-b92798cc765e","block_type":"box","text":"i.e.","page_number":68,"box":{"x":268,"y":839,"width":20,"height":8}},{"id":"e155f426-5916-4e8f-869d-21585ac018ee","block_type":"box","text":", sell) uncovered put options on securities or instruments in which it may invest but","page_number":68,"box":{"x":291,"y":839,"width":593,"height":10}},{"id":"ee9a0237-7785-475c-b69c-57f3118c9380","block_type":"box","text":"with respect to which the Fund does not currently have a corresponding shor t position or has not deposited as","page_number":68,"box":{"x":68,"y":854,"width":789,"height":11}},{"id":"b055f807-624c-4c3c-8ea1-1ebc67f15959","block_type":"box","text":"collateral cash equal to the exercise value of the put option with the broker-dealer through which it made the","page_number":68,"box":{"x":69,"y":869,"width":773,"height":11}},{"id":"9dbb0a00-a5f7-4500-82ac-423d3f51b685","block_type":"box","text":"uncovered put option. The principal reason for writing uncovered put options is to receive premium income and to","page_number":68,"box":{"x":69,"y":884,"width":807,"height":11}},{"id":"b7ad6b6e-84dd-4559-8f33-8eb52e2a7bd1","block_type":"box","text":"acquire such securities or instruments at a net cost below the current market value. A Fund has the obligation to buy","page_number":68,"box":{"x":69,"y":899,"width":835,"height":11}},{"id":"5337372e-c6ff-440f-9ded-6bc9ebe5745f","block_type":"box","text":"II-21","page_number":68,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"b7757cca-12c7-4cf1-ab6e-ecf178889c30","block_type":"box","text":"NM1026U-6033063-68/246","page_number":68,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"d69a11d5-4f03-47bf-b2fe-43434d4fa0b6","block_type":"box","text":"the securities or instruments at an agreed upon price if the price of the securities or instruments decreases below","page_number":69,"box":{"x":68,"y":45,"width":818,"height":11}},{"id":"5d3226e2-2d38-416f-b57f-0e9deb7c591a","block_type":"box","text":"the exercise price. If the price of the securities or instruments increases during the option period, the option will","page_number":69,"box":{"x":68,"y":60,"width":800,"height":11}},{"id":"5828bc02-6a91-4f02-9ccb-59454e39da54","block_type":"box","text":"expire wor thless and a Fund will retain the premium and will not have to purchase the securities or instruments at","page_number":69,"box":{"x":69,"y":75,"width":814,"height":11}},{"id":"596bddba-a0b4-461f-a516-ae4726c3d3e9","block_type":"box","text":"the exercise price.","page_number":69,"box":{"x":68,"y":90,"width":130,"height":11}},{"id":"deba947b-da99-49f3-ae88-74253ae60723","block_type":"box","text":"Options on Government National Mor tgage Association (“GNMA”) Cer tificates.","page_number":69,"box":{"x":102,"y":113,"width":556,"height":11}},{"id":"737dc908-f895-4e96-9ba0-7ab0e9eea077","block_type":"box","text":"The following information relates","page_number":69,"box":{"x":664,"y":113,"width":232,"height":11}},{"id":"1f5acb51-1a4e-4d71-8eb4-7a77a6448960","block_type":"box","text":"to the unique characteristics of options on GNMA Cer tificates. Since the remaining principal balance of GNMA","page_number":69,"box":{"x":68,"y":128,"width":784,"height":11}},{"id":"e30314c2-233d-455c-8f79-673367a26912","block_type":"box","text":"Cer tificates declines each month as a result of mor tgage payments, a Fund, as a writer of a GNMA call holding GNMA","page_number":69,"box":{"x":69,"y":143,"width":840,"height":11}},{"id":"6dafee19-430d-4342-8354-db251361469d","block_type":"box","text":"Cer tificates as “cover” to satisfy its delivery obligation in the event of exercise, may find that the GNMA Cer tificates","page_number":69,"box":{"x":69,"y":158,"width":827,"height":11}},{"id":"222751e0-3723-4929-aed7-2a3c9f8b8a32","block_type":"box","text":"it holds no longer have a sufficient remaining principal balance for this purpose. Should this occur, a Fund will","page_number":69,"box":{"x":70,"y":173,"width":781,"height":11}},{"id":"5833c5af-013a-4698-a30a-66828b3e38e3","block_type":"box","text":"purchase additional GNMA Cer tificates from the same pool (if obtainable) or other GNMA Cer tificates in the cash","page_number":69,"box":{"x":70,"y":188,"width":803,"height":11}},{"id":"388a4c1d-921e-434b-9614-5b62ede4f7fb","block_type":"box","text":"market in order to maintain its “cover.”","page_number":69,"box":{"x":69,"y":204,"width":277,"height":8}},{"id":"054b6dec-6459-4003-b6bb-87a6acb42ef0","block_type":"box","text":"A GNMA Cer tificate held by a Fund to cover an option position in any but the nearest expiration month may cease","page_number":69,"box":{"x":101,"y":226,"width":807,"height":11}},{"id":"4b2bd1e3-51ea-43fe-8dda-09b9bd56e088","block_type":"box","text":"to represent cover for the option in the event of a decline in the GNMA coupon rate at which new pools are originated","page_number":69,"box":{"x":68,"y":241,"width":835,"height":11}},{"id":"9a6199f5-d2f3-45f8-abee-97d4020ef192","block_type":"box","text":"under the FHA/VA loan ceiling in effect at any given time. If this should occur, a Fund will no longer be covered, and","page_number":69,"box":{"x":69,"y":256,"width":821,"height":12}},{"id":"18edad95-e878-41b2-82ef-31d454414332","block_type":"box","text":"the Fund will either enter into a closing purchase transaction or replace such Cer tificate with a cer tificate that","page_number":69,"box":{"x":68,"y":271,"width":784,"height":12}},{"id":"118ec9df-1fc2-4a2c-91d0-f2f4315ab5bf","block_type":"box","text":"represents cover. When a Fund closes its position or replaces such Cer tificate, it may realize an unanticipated loss","page_number":69,"box":{"x":69,"y":286,"width":820,"height":12}},{"id":"13488686-9876-4711-a3c4-b90fb52e6420","block_type":"box","text":"and incur transaction costs.","page_number":69,"box":{"x":69,"y":302,"width":197,"height":9}},{"id":"2e47cf63-a570-47e8-b43e-6eee861994d8","block_type":"box","text":"Options on Swaps (“Swaptions”).","page_number":69,"box":{"x":102,"y":324,"width":235,"height":11}},{"id":"54864e88-ba2a-4210-9a5a-fcae7bdd6bcd","block_type":"box","text":"A swaption gives a counterpar ty the option (but not the obligation) to enter into","page_number":69,"box":{"x":343,"y":325,"width":563,"height":11}},{"id":"99328565-2d65-48ec-80d4-f9cc67e7033f","block_type":"box","text":"a new swap agreement or to shor ten, extend, cancel or otherwise modify an existing swap agreement, at a","page_number":69,"box":{"x":69,"y":339,"width":763,"height":12}},{"id":"d8dce0ec-0460-4ffc-981d-fffb14695991","block_type":"box","text":"designated future time on specified terms. A Fund may write (","page_number":69,"box":{"x":69,"y":355,"width":439,"height":11}},{"id":"ce2b3df5-0350-4cc4-b0ce-412a916f2395","block_type":"box","text":"i.e.","page_number":69,"box":{"x":510,"y":355,"width":20,"height":9}},{"id":"116acc36-8bad-4b42-bf8d-df12481ee5c4","block_type":"box","text":", sell) and purchase put and call swaptions.","page_number":69,"box":{"x":533,"y":355,"width":309,"height":11}},{"id":"f5ee0176-3a86-4854-9633-c339d21c8303","block_type":"box","text":"Depending on the terms of the par ticular option agreement, a Fund will generally incur a greater degree of risk when","page_number":69,"box":{"x":70,"y":370,"width":826,"height":11}},{"id":"32b1ac2e-36f9-4f84-902b-262fd2f9b295","block_type":"box","text":"it writes a swaption than it will incur when it purchases a swaption. When a Fund purchases a swaption, it risks","page_number":69,"box":{"x":70,"y":385,"width":793,"height":11}},{"id":"128b30e9-d1d2-4b89-8033-501d499242e8","block_type":"box","text":"losing only the amount of the premium it has paid should it decide to let the option expire unexercised. However,","page_number":69,"box":{"x":70,"y":400,"width":802,"height":11}},{"id":"4ab711d3-5e0d-428a-ac32-c594c5566e56","block_type":"box","text":"when a Fund writes a swaption, upon exercise of the option the Fund will become obligated according to the terms of","page_number":69,"box":{"x":68,"y":415,"width":836,"height":11}},{"id":"f9be0e09-e533-4e1b-8dd9-3186891da72b","block_type":"box","text":"the underlying agreement and the potential for loss may be unlimited. Cer tain swaptions are permitted, although not","page_number":69,"box":{"x":68,"y":430,"width":832,"height":11}},{"id":"0884f966-ef45-4435-8fae-8f5b9b4553a3","block_type":"box","text":"required, to be cleared.","page_number":69,"box":{"x":69,"y":446,"width":165,"height":10}},{"id":"03d7b683-449e-4b42-a52a-27f5c92240c7","block_type":"box","text":"A Fund will likely enter into these transactions to preserve a return or spread on a par ticular investment or","page_number":69,"box":{"x":101,"y":468,"width":760,"height":11}},{"id":"4cdb21f4-b1db-4388-850f-43c445fb6611","block_type":"box","text":"por tion of its por tfolio or to protect against any increase in the price of securities the Fund anticipates purchasing at","page_number":69,"box":{"x":70,"y":483,"width":830,"height":11}},{"id":"02c87b60-1e62-4f09-a3b4-e6aac93f3346","block_type":"box","text":"a later date. A Fund generally will use these transactions for hedging purposes, not for speculation.","page_number":69,"box":{"x":69,"y":498,"width":706,"height":11}},{"id":"9d896b47-836a-4f45-9b41-a26e4c08fae1","block_type":"box","text":"Swaptions may be subject to correlation risk, leverage risk, illiquidity risk and market risk. See “—Risk Factors in","page_number":69,"box":{"x":102,"y":521,"width":805,"height":11}},{"id":"7484c2d5-fa3b-4f9c-9ee8-37439410fe09","block_type":"box","text":"Derivatives” above.","page_number":69,"box":{"x":70,"y":536,"width":135,"height":9}},{"id":"cb18ca22-6a89-41e2-a240-3e5bea583de2","block_type":"box","text":"FLEX Options.","page_number":69,"box":{"x":102,"y":559,"width":96,"height":11}},{"id":"0428db54-b406-453c-93aa-0e44f931d769","block_type":"box","text":"FLEX Options are customized option contracts available through national securities exchanges that","page_number":69,"box":{"x":206,"y":559,"width":702,"height":11}},{"id":"2a571d2a-473a-4c3c-bfa3-2f7a6664cbe2","block_type":"box","text":"are guaranteed for settlement by the Options Clearing Corporation (“OCC”). FLEX Options are listed on a U.S. national","page_number":69,"box":{"x":69,"y":574,"width":839,"height":11}},{"id":"f93e440b-59a0-471f-afbe-b27e71cf6beb","block_type":"box","text":"securities exchange. FLEX Options provide investors with the ability to customize assets referenced by the options,","page_number":69,"box":{"x":69,"y":589,"width":818,"height":11}},{"id":"8ad4b9ae-dacc-43c5-9a1c-5140ccc91bb0","block_type":"box","text":"exercise prices, exercise styles (","page_number":69,"box":{"x":69,"y":604,"width":231,"height":11}},{"id":"f4d0672e-db86-400d-b248-4a43ad1c94b8","block_type":"box","text":"i.e.","page_number":69,"box":{"x":302,"y":604,"width":20,"height":9}},{"id":"9e2044a0-a7ea-4f5b-b42e-eacb35add8f4","block_type":"box","text":", American-style, exercisable any time prior to the expiration date, or European","page_number":69,"box":{"x":325,"y":604,"width":561,"height":11}},{"id":"87499d0b-5d1a-49a0-9c14-f7730a63ae44","block_type":"box","text":"style, exercisable only on the option expiration date) and expiration dates, while achieving price discovery in","page_number":69,"box":{"x":69,"y":619,"width":768,"height":11}},{"id":"9bf0bed2-7e26-4480-b9f0-699cb4b1ee68","block_type":"box","text":"competitive, transparent auctions markets and avoiding the counterpar ty exposure of OTC options positions. Each","page_number":69,"box":{"x":69,"y":634,"width":812,"height":12}},{"id":"04aaba19-714b-49b0-9675-41235d8b9395","block_type":"box","text":"option contract entitles the holder thereof to purchase (for the call options) or sell (for the put options) shares of the","page_number":69,"box":{"x":69,"y":649,"width":830,"height":11}},{"id":"bd0f99b2-ebe5-438c-a461-0dd92c0380f6","block_type":"box","text":"reference asset at the strike price. A Fund’s por tfolio may include several types of FLEX Options, including both","page_number":69,"box":{"x":69,"y":664,"width":792,"height":12}},{"id":"9f82ca91-31e6-4f8b-90fb-35616f7eceea","block_type":"box","text":"purchased and written put and call options (as fur ther described below). The FLEX Options are all European style","page_number":69,"box":{"x":70,"y":680,"width":802,"height":11}},{"id":"1e2c3758-bcfe-4cad-84dd-917cdc116901","block_type":"box","text":"options, which means that they are exercisable at a predetermined specified price (the “strike price”) only on the","page_number":69,"box":{"x":69,"y":695,"width":806,"height":11}},{"id":"83a21479-253f-4e2c-87e6-19210e1ba234","block_type":"box","text":"FLEX Option’s expiration date.","page_number":69,"box":{"x":70,"y":710,"width":211,"height":11}},{"id":"1871a985-4443-465b-8185-53e59943f397","block_type":"box","text":"The OCC guarantees per formance by each of the counterpar ties to the FLEX Options, becoming the “buyer for","page_number":69,"box":{"x":101,"y":732,"width":783,"height":12}},{"id":"1e7de647-6b3a-46ba-8c23-a3f7f83ef2d0","block_type":"box","text":"every seller and the seller for every buyer”, reducing counterpar ty risk for clearing members and options traders.","page_number":69,"box":{"x":69,"y":748,"width":802,"height":11}},{"id":"adce541b-3ec0-4dd5-88ca-59908d21bd75","block_type":"box","text":"Although guaranteed for settlement by the OCC, FLEX Options are still subject to counterpar ty risk with the OCC and","page_number":69,"box":{"x":68,"y":763,"width":826,"height":11}},{"id":"57dead74-453b-42fb-9e4b-51b345bccff6","block_type":"box","text":"subject to the risk that the OCC may fail to per form the settlement of the FLEX Options due to bankruptcy or other","page_number":69,"box":{"x":69,"y":778,"width":814,"height":11}},{"id":"f1f71491-2bc6-4585-ab45-3ab5fbc312da","block_type":"box","text":"adverse reasons. A Fund bears the risk that the OCC will be unable or unwilling to per form its obligations under the","page_number":69,"box":{"x":69,"y":793,"width":822,"height":11}},{"id":"4466ecd4-e0da-49fc-9e53-64eaa42b205c","block_type":"box","text":"FLEX Options contracts.","page_number":69,"box":{"x":70,"y":808,"width":166,"height":11}},{"id":"b94b42de-e4fb-41e3-8856-06c934d18eb1","block_type":"box","text":"Subject to determination by the Securities Committee of the OCC, adjustments may be made to the FLEX","page_number":69,"box":{"x":102,"y":831,"width":748,"height":11}},{"id":"6730561f-d345-4bc0-afb8-6147a56328a6","block_type":"box","text":"Options for cer tain events (collectively, “Corporate Actions”) specified in the OCC’s by-laws and rules: cer tain stock","page_number":69,"box":{"x":69,"y":846,"width":822,"height":11}},{"id":"6ba99bbf-9235-4589-8453-1b8969a3a504","block_type":"box","text":"dividends or distributions, stock splits, reverse stock splits, rights offerings, distributions, reorganizations,","page_number":69,"box":{"x":69,"y":861,"width":759,"height":11}},{"id":"8dd7f06e-7209-48cc-bfb0-71b623871bd4","block_type":"box","text":"recapitalizations, or reclassifications with respect to an underlying security, or a merger, consolidation, dissolution or","page_number":69,"box":{"x":69,"y":876,"width":833,"height":11}},{"id":"28dd8869-ad32-4e98-8973-4e178fc17a60","block_type":"box","text":"liquidation of the issuer of the underlying security. According to the OCC’s by-laws, the nature and extent of any such","page_number":69,"box":{"x":70,"y":891,"width":829,"height":12}},{"id":"d342db1c-52c7-4e00-af6a-b044226f4361","block_type":"box","text":"adjustment is to be determined by the OCC’s Securities Committee, in light of the circumstances known to it at the","page_number":69,"box":{"x":69,"y":906,"width":821,"height":12}},{"id":"82624178-8f46-43bb-a3f5-9af70ba94c20","block_type":"box","text":"II-22","page_number":69,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"f1ddbbce-95c4-4735-8414-b9d923010b7e","block_type":"box","text":"NM1026U-6033063-69/246","page_number":69,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"6cb4ad1d-aad2-448a-b361-fa9fe4659cd2","block_type":"box","text":"time such determination is made, based on its judgment as to what is appropriate for the protection of investors and","page_number":70,"box":{"x":68,"y":45,"width":835,"height":11}},{"id":"b6d6eae4-e774-4905-bddd-e70738de57ec","block_type":"box","text":"the public interest, taking into account such factors as fairness to holders and writers (or purchasers and sellers) of","page_number":70,"box":{"x":68,"y":60,"width":829,"height":11}},{"id":"4548fb66-933f-49ac-b838-0b936f954193","block_type":"box","text":"the affected options, the maintenance of a fair and orderly market in the affected options, consistency of","page_number":70,"box":{"x":68,"y":75,"width":753,"height":11}},{"id":"0acc06cc-e8ab-4f8d-86d3-44896dd64ff2","block_type":"box","text":"interpretation and practice, efficiency of exercise settlement procedures, and the coordination with other clearing","page_number":70,"box":{"x":70,"y":90,"width":806,"height":11}},{"id":"40530adb-9822-451d-bd6b-e8ed225b822d","block_type":"box","text":"agencies of the clearance and settlement of transactions in the underlying interest.","page_number":70,"box":{"x":69,"y":105,"width":593,"height":11}},{"id":"2a98e2d4-a02c-4954-9f87-d2b35e3e4faa","block_type":"box","text":"Cer tain Considerations Regarding Options","page_number":70,"box":{"x":135,"y":128,"width":298,"height":11}},{"id":"915e7e64-f42f-4bdc-ab2e-4e080c6e860e","block_type":"box","text":". The FLEX Options in which each Fund may invest will be options","page_number":70,"box":{"x":435,"y":128,"width":461,"height":11}},{"id":"2402f6bc-0d94-4e37-a8fb-637f58955075","block_type":"box","text":"on an exchange-traded fund (“ETF”) or the S&P 500 Index (together with such ETF, a “Reference Asset”). As","page_number":70,"box":{"x":102,"y":143,"width":768,"height":11}},{"id":"a573c5d6-89c0-454d-8e85-14635b04b40e","block_type":"box","text":"such, the value of a Fund’s FLEX Options will fluctuate with changes in the value of the securities held by the","page_number":70,"box":{"x":102,"y":158,"width":775,"height":11}},{"id":"54c3f4e9-93ba-492d-a3e4-c72241fad2d4","block_type":"box","text":"ETF, and thus the ETF’s share price. In addition to the value of the ETF, the value of an option, in general, will","page_number":70,"box":{"x":102,"y":173,"width":777,"height":11}},{"id":"31358dd4-1231-40e6-b2b6-bb515e28dbc1","block_type":"box","text":"reflect, among other things, the time remaining until expiration (the end of the Outcome Period), the relationship","page_number":70,"box":{"x":102,"y":188,"width":799,"height":12}},{"id":"2fa26e91-79f1-4808-a412-e7f1ea72636f","block_type":"box","text":"of the exercise price to the market price of the Reference Asset, and general market conditions. Options that","page_number":70,"box":{"x":102,"y":203,"width":777,"height":12}},{"id":"dd825ee1-5907-4b6c-8f86-a460b5d5acf0","block_type":"box","text":"expire unexercised have no value.","page_number":70,"box":{"x":101,"y":219,"width":240,"height":10}},{"id":"4a219068-563e-4603-a36f-8f1197d3cac4","block_type":"box","text":"The puts and calls on the Reference Asset entitle the purchaser of the option the right to purchase (for a","page_number":70,"box":{"x":134,"y":241,"width":747,"height":11}},{"id":"5dcacb36-3b74-4777-93c9-ee1dbb5b175a","block_type":"box","text":"call option) or sell (for a put option) the Reference Asset at a predetermined specified price (the “strike price”).","page_number":70,"box":{"x":101,"y":256,"width":792,"height":11}},{"id":"b7e69328-f1dd-4c17-9140-5e271e56f8b9","block_type":"box","text":"When a Fund writes a call on the Reference Asset, it receives a premium and agrees that the purchaser of the","page_number":70,"box":{"x":101,"y":271,"width":786,"height":12}},{"id":"2f0ded3f-be15-41ac-8c7b-8e490426317a","block_type":"box","text":"call, upon exercise of the call, will receive from the Fund the delivery of a specified number of shares of the ETF","page_number":70,"box":{"x":101,"y":286,"width":798,"height":12}},{"id":"a61eff1b-fd4a-4543-816d-7a3f705f7138","block_type":"box","text":"in exchange for the strike price. When a Fund buys a call on the Reference Asset, it pays a premium and has the","page_number":70,"box":{"x":102,"y":302,"width":802,"height":11}},{"id":"2be5511d-e008-4c44-ba9b-696e4fa562ee","block_type":"box","text":"same rights to such call as indicated above. When a Fund buys a put on the Reference Asset, it pays a premium","page_number":70,"box":{"x":102,"y":317,"width":800,"height":11}},{"id":"ac84f53d-dfde-4736-a312-9bc9a1c6ee10","block_type":"box","text":"and has the right to require the seller of the put, upon the Fund’s exercise of the put, to deliver the specified","page_number":70,"box":{"x":102,"y":332,"width":774,"height":11}},{"id":"522e2053-d5e5-4ffe-974e-19e7fd315bb4","block_type":"box","text":"number of shares of the ETF in exchange for the strike price. When a Fund writes a put on the Reference Asset,","page_number":70,"box":{"x":102,"y":347,"width":793,"height":11}},{"id":"bf58751a-93c1-4417-b877-5461446413b5","block_type":"box","text":"it receives a premium and the purchaser of the put has the right to require the Fund to deliver the specified","page_number":70,"box":{"x":102,"y":362,"width":764,"height":11}},{"id":"546893b5-0850-4774-a4e1-e3b14a43b44c","block_type":"box","text":"number of shares of the ETF in exchange for the strike price.","page_number":70,"box":{"x":102,"y":377,"width":430,"height":12}},{"id":"d7d32175-28eb-4d2f-a290-9bbb90dde1bd","block_type":"box","text":"Although each Fund will generally utilize FLEX Options that are physically settled, a Fund may also utilize","page_number":70,"box":{"x":134,"y":400,"width":740,"height":11}},{"id":"5dbd07f8-a90e-442c-8fda-4f144fd32db7","block_type":"box","text":"FLEX Options that are cash-settled. Cash-settled options give the holder the right to receive an amount (or owe","page_number":70,"box":{"x":102,"y":415,"width":787,"height":11}},{"id":"3e0380b2-b76d-4cf0-b366-fe47a2c49187","block_type":"box","text":"an amount) of cash upon the exercise of the option. Gain or loss depends on changes in the value of the ETF’s","page_number":70,"box":{"x":102,"y":430,"width":790,"height":11}},{"id":"a27c4688-99b9-403d-9063-afc0e992460a","block_type":"box","text":"share price relative to the strike price for a given option contract. The amount of cash is equal to the difference","page_number":70,"box":{"x":102,"y":445,"width":793,"height":12}},{"id":"b4bb0bf6-8a6b-46a0-a81a-5ba27576995d","block_type":"box","text":"between the closing price of the ETF’s share price and the exercise price of the option contract times a specified","page_number":70,"box":{"x":102,"y":460,"width":802,"height":12}},{"id":"f9d179cb-0743-4f9f-8231-24224531b934","block_type":"box","text":"multiple (“multiplier”), which determines the total value for each point of such difference.","page_number":70,"box":{"x":102,"y":475,"width":635,"height":12}},{"id":"35cefe0c-beec-4d2e-b19e-47682d31393d","block_type":"box","text":"Risks of Options on the Reference Assets","page_number":70,"box":{"x":135,"y":498,"width":297,"height":11}},{"id":"5b771ebf-d09a-467b-b561-6578caba5256","block_type":"box","text":". If a Fund has purchased an option and exercises it before the","page_number":70,"box":{"x":433,"y":498,"width":448,"height":11}},{"id":"67634281-8c42-4ba4-b4ba-c40322d49bf6","block_type":"box","text":"closing value for that day is available, it runs the risk that the level of the Reference Asset may subsequently","page_number":70,"box":{"x":101,"y":513,"width":777,"height":12}},{"id":"e597f202-e7f1-4a07-934b-e0af12e28c76","block_type":"box","text":"change. If such a change causes the exercised option to fall out of the money, the applicable Fund will be","page_number":70,"box":{"x":101,"y":528,"width":753,"height":12}},{"id":"4e3e08fa-3729-4fe2-9912-ebf8f72484d1","block_type":"box","text":"required to pay the difference between the closing Reference Asset value and the exercise price of the option","page_number":70,"box":{"x":102,"y":543,"width":780,"height":12}},{"id":"653a9799-7601-4a60-bf4b-5815e1438890","block_type":"box","text":"(times the applicable multiplier) to the assigned writer.","page_number":70,"box":{"x":102,"y":559,"width":387,"height":11}},{"id":"d1dd54eb-7932-4034-bcef-9dc1a72d0ae8","block_type":"box","text":"Foreign Exchange Transactions.","page_number":70,"box":{"x":102,"y":582,"width":222,"height":11}},{"id":"7d20b66b-42c7-4fae-9d1a-134716ffb697","block_type":"box","text":"A Fund may enter into spot foreign exchange transactions, forward foreign exchange transactions (“FX forwards”)","page_number":70,"box":{"x":101,"y":604,"width":807,"height":11}},{"id":"7bc9c32e-1609-49ce-bdd5-3b3f889a896b","block_type":"box","text":"and currency swaps, purchase and sell currency options, currency futures and related options thereon (collectively,","page_number":70,"box":{"x":69,"y":619,"width":818,"height":11}},{"id":"83454231-cb1d-4f92-bf97-a626284f63ff","block_type":"box","text":"“Currency Instruments”) for purposes of hedging against the decline in the value of currencies in which its por tfolio","page_number":70,"box":{"x":70,"y":634,"width":821,"height":12}},{"id":"c1ed92a5-680f-4ce8-b8f3-d54c65321374","block_type":"box","text":"holdings are denominated against the U.S. dollar or, with respect to cer tain Funds, to seek to enhance returns.","page_number":70,"box":{"x":69,"y":649,"width":792,"height":12}},{"id":"daeb9461-7558-442d-9ae5-1f2760cafc7b","block_type":"box","text":"Such transactions could be effected to hedge with respect to foreign dollar denominated securities owned by a","page_number":70,"box":{"x":102,"y":672,"width":790,"height":11}},{"id":"785fc79c-3b6d-47f0-889a-a26f5c91217d","block_type":"box","text":"Fund, sold by a Fund but not yet delivered, or committed or anticipated to be purchased by a Fund. As an illustration,","page_number":70,"box":{"x":70,"y":687,"width":830,"height":11}},{"id":"34294437-2803-4d46-8e95-49d227845d00","block_type":"box","text":"a Fund may use such techniques to hedge the stated value in U.S. dollars of an investment in a yen-denominated","page_number":70,"box":{"x":69,"y":702,"width":808,"height":12}},{"id":"d56472fd-286a-4f32-88d5-7eb30cddf9c6","block_type":"box","text":"security. For example, the Fund may purchase a foreign currency put option enabling it to sell a specified amount of","page_number":70,"box":{"x":69,"y":717,"width":824,"height":12}},{"id":"d41e421c-b537-468b-88d3-bd8517b54343","block_type":"box","text":"yen for dollars at a specified price by a future date. To the extent the hedge is successful, a loss in the value of the","page_number":70,"box":{"x":68,"y":732,"width":823,"height":12}},{"id":"50428ee8-fe46-4e19-8186-f113152855c7","block_type":"box","text":"yen relative to the dollar will tend to be offset by an increase in the value of the put option. To offset, in whole or in","page_number":70,"box":{"x":68,"y":748,"width":821,"height":11}},{"id":"68b4f2d4-26c5-4331-ad04-0d5aad198803","block_type":"box","text":"par t, the cost of acquiring such a put option, the Fund may also sell a call option which, if exercised, requires it to","page_number":70,"box":{"x":70,"y":763,"width":813,"height":11}},{"id":"06bc844f-4c31-454d-a5c5-d2ec4c3b503a","block_type":"box","text":"sell a specified amount of yen for dollars at a specified price by a future date (a technique called a “straddle”). By","page_number":70,"box":{"x":69,"y":778,"width":813,"height":11}},{"id":"00680429-4939-4b5d-8c20-bfb66aa6583e","block_type":"box","text":"selling such a call option in this illustration, the Fund gives up the oppor tunity to profit without limit from increases in","page_number":70,"box":{"x":69,"y":793,"width":835,"height":11}},{"id":"50d35f66-6e88-4b4e-9042-03da3aca2bb5","block_type":"box","text":"the relative value of the yen to the dollar. “Straddles” of the type that may be used by a Fund are considered hedging","page_number":70,"box":{"x":68,"y":808,"width":836,"height":11}},{"id":"fa960cfa-acf7-4146-bf5c-426e803f293c","block_type":"box","text":"transactions. Cer tain Funds have a fundamental investment restriction that restricts currency option strategies.","page_number":70,"box":{"x":68,"y":823,"width":794,"height":12}},{"id":"57a80bb8-bf20-4754-b69a-c2b1f7e7fbf9","block_type":"box","text":"Hedging transactions involving Currency Instruments involve substantial risks, including correlation risk. A Fund’s","page_number":70,"box":{"x":102,"y":846,"width":805,"height":11}},{"id":"899c9133-000e-405e-bbdf-ff3558906135","block_type":"box","text":"use of Currency Instruments to effect hedging strategies is intended to reduce the volatility of the NAV of the Fund’s","page_number":70,"box":{"x":69,"y":861,"width":828,"height":11}},{"id":"8d426267-a3d6-46ab-9cce-26fc1614f2e8","block_type":"box","text":"shares; however, the use of such hedging strategies will not prevent the NAV of the Fund’s shares from fluctuating.","page_number":70,"box":{"x":69,"y":876,"width":819,"height":11}},{"id":"6578d102-6892-4a2d-a24d-15e2098c42b9","block_type":"box","text":"Moreover, although Currency Instruments will be used with the intention of hedging against adverse currency","page_number":70,"box":{"x":70,"y":891,"width":773,"height":12}},{"id":"fa1a2df5-6124-4a0a-ba7e-71e4f4440413","block_type":"box","text":"movements, transactions in Currency Instruments involve the risk that anticipated currency movements will not be","page_number":70,"box":{"x":69,"y":906,"width":814,"height":12}},{"id":"359c5240-2d2b-44de-8f2f-976b18beaa4d","block_type":"box","text":"II-23","page_number":70,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"498fa3af-2ab0-43e8-bd05-808eacb1b7a6","block_type":"box","text":"NM1026U-6033063-70/246","page_number":70,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"89e560e2-50d3-482d-bc19-1970e240525e","block_type":"box","text":"accurately predicted and that the Fund’s hedging strategies will be ineffective. To the extent that a Fund hedges","page_number":71,"box":{"x":69,"y":45,"width":796,"height":11}},{"id":"3b5bed26-6f5b-4d8d-8883-7e4bcc2f6668","block_type":"box","text":"against anticipated currency movements that do not occur, the Fund may realize losses and decrease its total return.","page_number":71,"box":{"x":69,"y":60,"width":835,"height":11}},{"id":"c455e960-4610-41a0-8656-444e3fbbc8b4","block_type":"box","text":"Fur thermore, a Fund will only engage in hedging activities from time to time and may not be engaging in hedging","page_number":71,"box":{"x":70,"y":75,"width":798,"height":11}},{"id":"9518e137-8e02-4e77-ad0f-76386f981974","block_type":"box","text":"activities when movements in currency exchange rates actually occur.","page_number":71,"box":{"x":69,"y":90,"width":493,"height":11}},{"id":"dad9c549-d306-4e09-a4a4-a704f4ede179","block_type":"box","text":"In connection with its trading in forward foreign currency contracts, a Fund will contract with a foreign or","page_number":71,"box":{"x":102,"y":113,"width":738,"height":11}},{"id":"81bcdc62-3f70-487e-a7fc-147f59899cfe","block_type":"box","text":"domestic bank, or foreign or domestic securities dealer, to make or take future delivery of a specified amount of a","page_number":71,"box":{"x":69,"y":128,"width":814,"height":11}},{"id":"674fb215-7c53-4fd1-a4ae-9f4eddff5545","block_type":"box","text":"par ticular currency. There are no limitations on daily price moves in such forward contracts, and banks and dealers","page_number":71,"box":{"x":70,"y":143,"width":819,"height":11}},{"id":"4c63a1e7-ab28-4c51-855c-a7bd8fb16a99","block_type":"box","text":"are not required to continue to make markets in such contracts. There have been periods during which cer tain banks","page_number":71,"box":{"x":69,"y":158,"width":834,"height":11}},{"id":"fe7c185f-b6ab-45dc-81f2-e2f0af2a6bfb","block_type":"box","text":"or dealers have refused to quote prices for such forward contracts or have quoted prices with an unusually wide","page_number":71,"box":{"x":69,"y":173,"width":797,"height":11}},{"id":"f3da337e-336d-4af0-bf9a-52b9ae4ff7f9","block_type":"box","text":"spread between the price at which the bank or dealer is prepared to buy and that at which it is prepared to sell.","page_number":71,"box":{"x":69,"y":188,"width":794,"height":11}},{"id":"513ef4bd-0fe5-4e3a-a302-2d41f68e2465","block_type":"box","text":"Governmental imposition of currency controls might limit any such forward contract trading. With respect to its trading","page_number":71,"box":{"x":69,"y":203,"width":841,"height":12}},{"id":"f0ad8f0a-b91a-4099-b6f8-6bd70431cac5","block_type":"box","text":"of forward contracts, if any, a Fund will be subject to counterpar ty risk. Any such failure to per form by a counterpar ty","page_number":71,"box":{"x":69,"y":218,"width":831,"height":12}},{"id":"e924112a-c35b-4403-88b2-ff3ed90eb6fa","block_type":"box","text":"would deprive the Fund of any profit potential or force the Fund to cover its commitments for resale, if any, at the","page_number":71,"box":{"x":68,"y":234,"width":805,"height":11}},{"id":"a214e081-2423-45f2-95cf-974a5cdf1b20","block_type":"box","text":"then market price and could result in a loss to the Fund.","page_number":71,"box":{"x":68,"y":249,"width":401,"height":11}},{"id":"9d904e15-806b-4576-9c94-ae804af958ee","block_type":"box","text":"It may not be possible for a Fund to hedge against currency exchange rate movements, even if correctly","page_number":71,"box":{"x":102,"y":271,"width":738,"height":12}},{"id":"e3b65312-46cf-4273-830d-f9044ff03a3b","block_type":"box","text":"anticipated, in the event that (i) the currency exchange rate movement is so generally anticipated that the Fund is not","page_number":71,"box":{"x":69,"y":287,"width":837,"height":11}},{"id":"353dc50a-d061-403f-903e-f0360895e044","block_type":"box","text":"able to enter into a hedging transaction at an effective price, or (ii) the currency exchange rate movement relates to a","page_number":71,"box":{"x":69,"y":302,"width":837,"height":11}},{"id":"869f8ae5-7031-42b0-b76d-51e93ac4cc7b","block_type":"box","text":"market with respect to which Currency Instruments are not available and it is not possible to engage in effective","page_number":71,"box":{"x":69,"y":317,"width":800,"height":11}},{"id":"73a2c0e8-597e-48fb-942c-b7396825c307","block_type":"box","text":"foreign currency hedging. The cost to a Fund of engaging in foreign currency transactions varies with such factors as","page_number":71,"box":{"x":68,"y":332,"width":829,"height":11}},{"id":"4c6d9d75-4c4e-477a-9d34-93255bf128cc","block_type":"box","text":"the currencies involved, the length of the contract period and the market conditions then prevailing. Since","page_number":71,"box":{"x":68,"y":347,"width":753,"height":11}},{"id":"bb3f8d0f-2fc1-47db-8e08-360d67b7f73b","block_type":"box","text":"transactions in foreign currency exchange usually are conducted on a principal basis, no fees or commissions are","page_number":71,"box":{"x":68,"y":362,"width":811,"height":11}},{"id":"d17af84a-0b6b-4fd0-91f8-07eda40c76a0","block_type":"box","text":"involved.","page_number":71,"box":{"x":70,"y":377,"width":59,"height":9}},{"id":"90054bd7-9d06-43c8-b609-9a10964ec3a2","block_type":"box","text":"A Fund will not hedge a currency in excess of the aggregate market value of the securities that it owns (including","page_number":71,"box":{"x":101,"y":400,"width":803,"height":11}},{"id":"7a4b4d53-e469-4828-b0d4-804c45485f0c","block_type":"box","text":"receivables for unsettled securities sales), or has committed to purchase or anticipates purchasing, which are","page_number":71,"box":{"x":69,"y":415,"width":785,"height":11}},{"id":"12ce3136-01b8-451c-88b2-16d914c29caf","block_type":"box","text":"denominated in such currency.","page_number":71,"box":{"x":69,"y":430,"width":216,"height":11}},{"id":"56095eea-a7ee-4102-ad37-307127b46d47","block_type":"box","text":"Spot Transactions and FX Forwards.","page_number":71,"box":{"x":102,"y":453,"width":254,"height":11}},{"id":"1e8e7150-3e5a-46fb-8ec4-2ee7c1b1d828","block_type":"box","text":"FX forwards are OTC contracts to purchase or sell a specified amount of a","page_number":71,"box":{"x":364,"y":453,"width":527,"height":11}},{"id":"7e2de977-c951-4950-9b3b-211f784856ef","block_type":"box","text":"specified currency or multinational currency unit at a specified price and specified future date. Spot foreign exchange","page_number":71,"box":{"x":69,"y":468,"width":834,"height":11}},{"id":"647af945-3786-4284-83cb-8467756cdf0d","block_type":"box","text":"transactions are similar but are settled in the current, or “spot”, market. A Fund will enter into foreign exchange","page_number":71,"box":{"x":68,"y":483,"width":798,"height":11}},{"id":"f54c32df-51ee-460c-a74b-5bcee469be14","block_type":"box","text":"transactions for purposes of hedging either a specific transaction or a por tfolio position, or, with respect to cer tain","page_number":71,"box":{"x":68,"y":498,"width":817,"height":11}},{"id":"1cc93f76-efbd-4c0d-8515-51ff2827cc90","block_type":"box","text":"Funds, to seek to enhance returns. FX forwards involve substantial currency risk, credit risk and liquidity risk. A Fund","page_number":71,"box":{"x":70,"y":513,"width":830,"height":11}},{"id":"dcefe668-2d4d-4087-a78e-622a59617b53","block_type":"box","text":"may enter into a foreign exchange transaction for purposes of hedging a specific transaction by, for example,","page_number":71,"box":{"x":69,"y":528,"width":774,"height":12}},{"id":"46da447d-813a-459c-8f2f-e3b37d4984ab","block_type":"box","text":"purchasing a currency needed to settle a security transaction or selling a currency in which the Fund has received or","page_number":71,"box":{"x":70,"y":544,"width":828,"height":11}},{"id":"0585c545-3d68-4914-91cb-ae0f4ff4420c","block_type":"box","text":"anticipates receiving a dividend or distribution. A Fund may enter into a foreign exchange transaction for purposes of","page_number":71,"box":{"x":69,"y":559,"width":830,"height":11}},{"id":"aeac93bd-e387-4a28-8fa6-17abfebefcac","block_type":"box","text":"hedging a por tfolio position by selling forward a currency in which a por tfolio position of the Fund is denominated or","page_number":71,"box":{"x":69,"y":574,"width":826,"height":11}},{"id":"73f0475a-e080-49b6-bae5-04c0c1e921d6","block_type":"box","text":"by purchasing a currency in which the Fund anticipates acquiring a por tfolio position in the near future. A Fund may","page_number":71,"box":{"x":69,"y":589,"width":819,"height":11}},{"id":"e55caf4f-37bb-4416-bc33-b35dc5f0706e","block_type":"box","text":"also hedge a currency by entering into a transaction in a Currency Instrument denominated in a currency other than","page_number":71,"box":{"x":69,"y":604,"width":822,"height":11}},{"id":"c55b90f5-1ce2-4d89-b43f-a309c258bda1","block_type":"box","text":"the currency being hedged (a “cross-hedge”). A Fund will only enter into a cross-hedge if the Manager believes that","page_number":71,"box":{"x":68,"y":619,"width":819,"height":11}},{"id":"8b88eb57-0af8-4e0c-bbcb-6f3863c631ce","block_type":"box","text":"(i) there is a demonstrably high correlation between the currency in which the cross-hedge is denominated and the","page_number":71,"box":{"x":69,"y":634,"width":814,"height":12}},{"id":"00381150-6d22-4c33-8cf5-198614db471e","block_type":"box","text":"currency being hedged, and (ii) executing a cross-hedge through the currency in which the cross-hedge is","page_number":71,"box":{"x":69,"y":650,"width":745,"height":11}},{"id":"806f09c2-b616-46cc-b039-766c29e6d131","block_type":"box","text":"denominated will be significantly more cost-effective or provide substantially greater liquidity than executing a similar","page_number":71,"box":{"x":69,"y":664,"width":832,"height":12}},{"id":"709e16ea-6151-448d-9a10-b78d616edf2c","block_type":"box","text":"hedging transaction by means of the currency being hedged.","page_number":71,"box":{"x":69,"y":680,"width":428,"height":11}},{"id":"56fe1829-fe17-47f6-840e-3e007a80562d","block_type":"box","text":"A Fund may also engage in proxy hedging transactions to reduce the effect of currency fluctuations on the value","page_number":71,"box":{"x":101,"y":702,"width":797,"height":12}},{"id":"ad381630-b48a-4b89-9d17-19026e13fb2e","block_type":"box","text":"of existing or anticipated holdings of por tfolio securities. Proxy hedging is often used when the currency to which the","page_number":71,"box":{"x":69,"y":717,"width":829,"height":12}},{"id":"21469f6c-2795-4c10-b2d6-cd5f6b51ed8e","block_type":"box","text":"Fund is exposed is difficult to hedge, or to hedge against the U.S. dollar. Proxy hedging entails entering into a forward","page_number":71,"box":{"x":70,"y":732,"width":838,"height":12}},{"id":"551a5bd6-0255-41c2-b7f3-6c3224685649","block_type":"box","text":"contract to sell a currency whose changes in value are generally considered to be linked to a currency or currencies","page_number":71,"box":{"x":69,"y":748,"width":823,"height":11}},{"id":"b959a687-7d47-4d21-9735-c81f3cc3e6fb","block_type":"box","text":"in which some or all of the Fund’s securities are, or are expected to be, denominated, and to buy U.S. dollars. Proxy","page_number":71,"box":{"x":70,"y":763,"width":827,"height":11}},{"id":"277f692b-6342-451f-90c2-c733740a3cc3","block_type":"box","text":"hedging involves some of the same risks and considerations as other transactions with similar instruments. Currency","page_number":71,"box":{"x":69,"y":778,"width":838,"height":11}},{"id":"749c493b-ce9d-4981-b36d-fb74bfb69705","block_type":"box","text":"transactions can result in losses to the Fund if the currency being hedged fluctuates in value to a degree or in a","page_number":71,"box":{"x":68,"y":793,"width":798,"height":11}},{"id":"e7ccf4c8-2bcf-43b1-b77c-e69e56e5cc27","block_type":"box","text":"direction that is not anticipated. In addition, there is the risk that the perceived linkage between various currencies","page_number":71,"box":{"x":69,"y":808,"width":819,"height":11}},{"id":"db5ce4ea-d8dd-4dc4-ba25-f56551cad505","block_type":"box","text":"may not be present, including during the par ticular time that a Fund is engaging in proxy hedging.","page_number":71,"box":{"x":69,"y":823,"width":691,"height":12}},{"id":"a92ce563-37ae-41d2-9daf-3fdc446540c1","block_type":"box","text":"A Fund may also cross-hedge currencies by entering into forward contracts to sell one or more currencies that","page_number":71,"box":{"x":101,"y":846,"width":785,"height":11}},{"id":"15e2ae4d-57f9-4cc4-bfdf-f0f9a4cf9f4e","block_type":"box","text":"are expected to decline in value relative to other currencies to which the Fund has or in which the Fund expects to","page_number":71,"box":{"x":69,"y":861,"width":811,"height":11}},{"id":"e533631a-3137-4048-9461-e365401aabbf","block_type":"box","text":"have por tfolio exposure. For example, a Fund may hold both Canadian government bonds and Japanese government","page_number":71,"box":{"x":69,"y":876,"width":828,"height":11}},{"id":"425de1b2-1cda-454f-9a6e-720e4e282592","block_type":"box","text":"bonds, and the Manager or sub-adviser may believe that Canadian dollars will deteriorate against Japanese yen. The","page_number":71,"box":{"x":69,"y":891,"width":829,"height":12}},{"id":"b555d0d5-42a5-4c7f-84ea-25f5325b88eb","block_type":"box","text":"Fund would sell Canadian dollars to reduce its exposure to that currency and buy Japanese yen. This strategy would","page_number":71,"box":{"x":70,"y":906,"width":823,"height":12}},{"id":"eaf35d5f-a408-4f10-af5f-0568c1b62dc2","block_type":"box","text":"II-24","page_number":71,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"7ea48e6f-09fe-431d-9bc1-8cece84ca8aa","block_type":"box","text":"NM1026U-6033063-71/246","page_number":71,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"156d212c-66f9-45ad-b829-7f71e88be5eb","block_type":"box","text":"be a hedge against a decline in the value of Canadian dollars, although it would expose the Fund to declines in the","page_number":72,"box":{"x":69,"y":45,"width":818,"height":11}},{"id":"df510223-6e5e-48d7-9baf-1591e4817e96","block_type":"box","text":"value of the Japanese yen relative to the U.S. dollar.","page_number":72,"box":{"x":68,"y":60,"width":372,"height":11}},{"id":"184d4614-461b-4990-a40d-6e4ec0ac290f","block_type":"box","text":"Some of the forward non-U.S. currency contracts entered into by the Funds are classified as non-deliverable","page_number":72,"box":{"x":102,"y":82,"width":768,"height":12}},{"id":"7b6d4b34-8b77-4f7e-9c7f-d02572897742","block_type":"box","text":"forwards (“NDFs”). NDFs are cash-settled, shor t-term forward contracts that may be thinly traded or are denominated","page_number":72,"box":{"x":68,"y":98,"width":838,"height":11}},{"id":"d099482c-2fba-45d3-a820-33a3cccb0928","block_type":"box","text":"in non-conver tible foreign currency, where the profit or loss at the time at the settlement date is calculated by taking","page_number":72,"box":{"x":70,"y":113,"width":829,"height":11}},{"id":"f9f62e26-5911-430b-9471-2cbf210ed7e4","block_type":"box","text":"the difference between the agreed upon exchange rate and the spot rate at the time of settlement, for an agreed","page_number":72,"box":{"x":68,"y":128,"width":806,"height":11}},{"id":"8bdbffe3-f674-4fa3-bed3-243c2494e923","block_type":"box","text":"upon notional amount of funds. All NDFs have a fixing date and a settlement date. The fixing date is the date at which","page_number":72,"box":{"x":69,"y":143,"width":839,"height":11}},{"id":"5e439a18-949b-40a1-a53d-f3919da5a18a","block_type":"box","text":"the difference between the prevailing market exchange rate and the agreed upon exchange rate is calculated. The","page_number":72,"box":{"x":68,"y":158,"width":812,"height":11}},{"id":"60bca81d-c7ec-4d60-8f02-94645447cb0a","block_type":"box","text":"settlement date is the date by which the payment of the difference is due to the par ty receiving payment. NDFs are","page_number":72,"box":{"x":69,"y":173,"width":821,"height":11}},{"id":"16517399-5732-40a8-b162-ff1cc1eb6fe2","block_type":"box","text":"commonly quoted for time periods of one month up to two years, and are normally quoted and settled in U.S. dollars.","page_number":72,"box":{"x":69,"y":188,"width":835,"height":11}},{"id":"011536eb-2575-477f-a58f-a2683478f5bb","block_type":"box","text":"They are often used to gain exposure to and/or hedge exposure to foreign currencies that are not internationally","page_number":72,"box":{"x":68,"y":203,"width":802,"height":12}},{"id":"c1f81e76-bc41-48c8-b857-7a4a5b9544b1","block_type":"box","text":"traded.","page_number":72,"box":{"x":68,"y":219,"width":49,"height":8}},{"id":"6fdea3c3-45a0-4ab8-a57f-2d6e7e38ad44","block_type":"box","text":"Currency Futures.","page_number":72,"box":{"x":102,"y":241,"width":123,"height":11}},{"id":"8f6f3325-ed04-4f59-8378-b5226d0ad4ce","block_type":"box","text":"A Fund may seek to enhance returns or hedge against the decline in the value of a currency","page_number":72,"box":{"x":232,"y":241,"width":654,"height":11}},{"id":"706ee430-95f5-4501-b16d-ef77d63df5be","block_type":"box","text":"through use of currency futures or options on currency futures. Currency futures are similar to forward foreign","page_number":72,"box":{"x":68,"y":256,"width":782,"height":12}},{"id":"6e1b34a3-0b68-40b7-be02-154aeb3bc8ef","block_type":"box","text":"exchange transactions except that futures are standardized, exchange-traded contracts while forward foreign","page_number":72,"box":{"x":69,"y":271,"width":774,"height":12}},{"id":"155339f3-a97a-4299-b44a-4d1106e2f821","block_type":"box","text":"exchange transactions are traded in the OTC market. Currency futures involve substantial currency risk as well as the","page_number":72,"box":{"x":69,"y":286,"width":836,"height":12}},{"id":"51f90c54-a91e-4d6e-a09f-e7ccc9f4d700","block_type":"box","text":"risks discussed above in “—Futures.”","page_number":72,"box":{"x":69,"y":302,"width":269,"height":9}},{"id":"d4f818c7-bffc-42b7-9d26-d55fc9617092","block_type":"box","text":"Currency Options.","page_number":72,"box":{"x":102,"y":324,"width":125,"height":11}},{"id":"c1da20b2-e52d-4386-99bd-31578ed9432a","block_type":"box","text":"A Fund may seek to enhance returns or hedge against the decline in the value of a currency","page_number":72,"box":{"x":233,"y":324,"width":654,"height":12}},{"id":"bf836917-645a-4034-b4de-e1027cbcfee0","block_type":"box","text":"through the use of currency options. Cer tain Funds have fundamental investment restrictions that permit the","page_number":72,"box":{"x":68,"y":339,"width":776,"height":12}},{"id":"b3c2ec8e-462a-490d-9079-6c57ed3a6b55","block_type":"box","text":"purchase of currency options, but prohibit the writing of currency options. Currency options are similar to options on","page_number":72,"box":{"x":70,"y":355,"width":825,"height":11}},{"id":"32604429-bcc8-42fe-8823-ac4d9107b69e","block_type":"box","text":"securities. For example, in consideration for an option premium the writer of a currency option is obligated to sell (in","page_number":72,"box":{"x":69,"y":370,"width":827,"height":11}},{"id":"9cc3bf1d-7370-4626-92b8-5e0a7849d71f","block_type":"box","text":"the case of a call option) or purchase (in the case of a put option) a specified amount of a specified currency on or","page_number":72,"box":{"x":68,"y":385,"width":820,"height":11}},{"id":"b57045ec-5a77-409e-b484-74a8b1673a5d","block_type":"box","text":"before the expiration date for a specified amount of another currency. A Fund may engage in transactions in options","page_number":72,"box":{"x":69,"y":400,"width":824,"height":11}},{"id":"2983a68e-140e-4dce-a049-5913b07b4fcb","block_type":"box","text":"on currencies either on exchanges or OTC markets. Such transactions in options may include exotic options on","page_number":72,"box":{"x":69,"y":415,"width":790,"height":11}},{"id":"5506b80b-763b-470f-a38b-447c1fbcd239","block_type":"box","text":"currencies, which are typically traded in OTC markets and have additional features that result in different payment","page_number":72,"box":{"x":69,"y":430,"width":813,"height":11}},{"id":"3ac565ce-41c0-4903-9326-189515fc7e27","block_type":"box","text":"structures and/or expirations. Where a Fund is permitted to write currency options, it may write covered call options","page_number":72,"box":{"x":69,"y":446,"width":826,"height":10}},{"id":"df78fe35-e4ff-45d5-995c-69e84463d9fd","block_type":"box","text":"on up to 100% of the currencies in its por tfolio. See “—Options” above. Currency options involve substantial","page_number":72,"box":{"x":69,"y":460,"width":776,"height":12}},{"id":"728baa8b-f483-4e0b-8385-ad6f700c97f0","block_type":"box","text":"currency risk, and may also involve credit, leverage or illiquidity risk.","page_number":72,"box":{"x":69,"y":476,"width":483,"height":11}},{"id":"40abb7e4-defb-42f1-9781-69fc895f0f3f","block_type":"box","text":"Currency Swaps.","page_number":72,"box":{"x":102,"y":498,"width":117,"height":11}},{"id":"9b8a3394-c260-4fc1-b892-b289574ce2d2","block_type":"box","text":"A Fund may enter into currency swaps in order to protect against currency fluctuations or to","page_number":72,"box":{"x":225,"y":498,"width":652,"height":11}},{"id":"7a562795-66c2-4d84-9372-687bd57354f3","block_type":"box","text":"hedge por tfolio positions. Currency swaps are transactions in which one currency is simultaneously bought for a","page_number":72,"box":{"x":69,"y":513,"width":799,"height":12}},{"id":"de0de55b-81f2-46f2-8d4e-b048552b9d9a","block_type":"box","text":"second currency on a spot basis and sold for the second currency on a forward basis. Currency swaps involve the","page_number":72,"box":{"x":69,"y":528,"width":812,"height":12}},{"id":"73360d4f-9883-414a-8b21-c0756069f9bd","block_type":"box","text":"exchange of the rights of a Fund and another par ty to make or receive payments in specified currencies, and typically","page_number":72,"box":{"x":69,"y":543,"width":836,"height":12}},{"id":"490a07ed-3c0a-49b2-9a8e-b0e62ee12485","block_type":"box","text":"require the delivery of the entire principal value of one designated currency in exchange for the other designated","page_number":72,"box":{"x":69,"y":559,"width":800,"height":11}},{"id":"654f5dfd-f6de-4fda-8c12-c01af65f41ee","block_type":"box","text":"currency. As a result, the entire principal value of a currency swap is subject to the risk that the other par ty to the","page_number":72,"box":{"x":69,"y":574,"width":810,"height":11}},{"id":"fca164bc-245b-4e17-bbad-8898690a4acb","block_type":"box","text":"swap will default on its contractual delivery obligations.","page_number":72,"box":{"x":69,"y":589,"width":393,"height":11}},{"id":"afbdca76-e398-48d1-8c01-29c5c246523c","block_type":"box","text":"Distressed Securities.","page_number":72,"box":{"x":102,"y":612,"width":159,"height":9}},{"id":"c837e62a-6607-4420-be68-aa9dd4a38098","block_type":"box","text":"A Fund may invest in securities, including loans purchased in the secondary market, that","page_number":72,"box":{"x":267,"y":612,"width":633,"height":11}},{"id":"79d0ab0b-79d2-41a4-ae31-15919e6784d6","block_type":"box","text":"are the subject of bankruptcy proceedings or otherwise in default or in risk of being in default as to the repayment of","page_number":72,"box":{"x":69,"y":627,"width":834,"height":11}},{"id":"5e1ba05b-309b-4e3c-9548-f195bcf9d68c","block_type":"box","text":"principal and/or interest at the time of acquisition by the Fund or that are rated in the lower rating categories by one","page_number":72,"box":{"x":70,"y":642,"width":827,"height":11}},{"id":"065b98bc-e09f-43c2-a84a-e876b57fec3e","block_type":"box","text":"or more nationally recognized statistical rating organizations (for example, Ca or lower by Moody’s and CC or lower by","page_number":72,"box":{"x":69,"y":657,"width":835,"height":11}},{"id":"7a977429-d49b-4e46-b82e-325826815c26","block_type":"box","text":"S&P or Fitch) or, if unrated, are in the judgment of the Manager of equivalent quality (“Distressed Securities”).","page_number":72,"box":{"x":69,"y":672,"width":784,"height":11}},{"id":"44f81e9e-ed4e-4e64-8753-5dd430b1c8f7","block_type":"box","text":"Investment in Distressed Securities is speculative and involves significant risks.","page_number":72,"box":{"x":70,"y":687,"width":569,"height":11}},{"id":"c7bc9d92-f1eb-4291-a103-b716c63c1ff2","block_type":"box","text":"A Fund will generally make such investments only when the Manager believes it is reasonably likely that the","page_number":72,"box":{"x":101,"y":710,"width":766,"height":11}},{"id":"a1f7fa2b-d5db-41d6-9093-d5164cabda4d","block_type":"box","text":"issuer of the Distressed Securities will make an exchange offer or will be the subject of a plan of reorganization","page_number":72,"box":{"x":70,"y":725,"width":795,"height":11}},{"id":"11523052-bcf6-4478-8abf-4a35a8bab571","block_type":"box","text":"pursuant to which the Fund will receive new securities in return for the Distressed Securities. However, there can be","page_number":72,"box":{"x":70,"y":740,"width":826,"height":11}},{"id":"580624da-95bf-4386-ad25-3c35bdde7e17","block_type":"box","text":"no assurance that such an exchange offer will be made or that such a plan of reorganization will be adopted. In","page_number":72,"box":{"x":69,"y":755,"width":794,"height":11}},{"id":"a4b57a41-9c9a-4e70-b839-f9aec446a756","block_type":"box","text":"addition, a significant period of time may pass between the time at which a Fund makes its investment in Distressed","page_number":72,"box":{"x":69,"y":770,"width":832,"height":12}},{"id":"c361a7bb-90f4-4a0a-b3ba-dafda876070a","block_type":"box","text":"Securities and the time that any such exchange offer or plan of reorganization is completed. During this period, it is","page_number":72,"box":{"x":69,"y":785,"width":824,"height":12}},{"id":"227c864e-61e1-42f5-982f-c7b13e31136a","block_type":"box","text":"unlikely that a Fund will receive any interest payments on the Distressed Securities, the Fund will be subject to","page_number":72,"box":{"x":69,"y":801,"width":789,"height":11}},{"id":"1985261a-53fb-4622-a833-9af5a0c7a44f","block_type":"box","text":"significant uncer tainty as to whether or not the exchange offer or plan of reorganization will be completed and the","page_number":72,"box":{"x":69,"y":816,"width":810,"height":11}},{"id":"9b3fdf36-2f98-4152-94d4-7895f983b052","block_type":"box","text":"Fund may be required to bear cer tain extraordinary expenses to protect and recover its investment. Therefore, to the","page_number":72,"box":{"x":70,"y":831,"width":831,"height":11}},{"id":"13efb706-2974-4d45-8c19-c34d8e8a003e","block_type":"box","text":"extent the Fund seeks capital appreciation through investment in distressed securities, the Fund’s ability to achieve","page_number":72,"box":{"x":69,"y":846,"width":826,"height":11}},{"id":"cbfcfdbc-8c05-487e-978c-ba02ea9410d5","block_type":"box","text":"current income for its shareholders may be diminished. The Fund also will be subject to significant uncer tainty as to","page_number":72,"box":{"x":69,"y":861,"width":827,"height":11}},{"id":"786a0dd7-fb79-40dc-9d03-3ab4e3fbf800","block_type":"box","text":"when and in what manner and for what value the obligations evidenced by the distressed securities will eventually be","page_number":72,"box":{"x":68,"y":876,"width":834,"height":11}},{"id":"03e75038-0cd8-4e69-9bb5-7146026118d5","block_type":"box","text":"satisfied (","page_number":72,"box":{"x":69,"y":891,"width":70,"height":11}},{"id":"2c2b8b8e-e25c-4168-a4a4-a9f9d923c80b","block_type":"box","text":"e.g.","page_number":72,"box":{"x":140,"y":893,"width":25,"height":10}},{"id":"b90dce22-4169-4fae-8a11-de413452bb8f","block_type":"box","text":", through a liquidation of the obligor’s assets, an exchange offer or plan of reorganization involving the","page_number":72,"box":{"x":168,"y":891,"width":729,"height":12}},{"id":"b9a49075-e047-4d2e-b03f-be4df2724ebf","block_type":"box","text":"distressed securities or a payment of some amount in satisfaction of the obligation). Even if an exchange offer is","page_number":72,"box":{"x":69,"y":906,"width":807,"height":12}},{"id":"45528dd0-f9b1-43fb-837b-3bf150ff2279","block_type":"box","text":"II-25","page_number":72,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"55fb405e-3649-4dd2-b499-3ff8a2e4a085","block_type":"box","text":"NM1026U-6033063-72/246","page_number":72,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"d6e18563-dc95-4ed0-a047-0a7ea6ce8e6d","block_type":"box","text":"made or plan of reorganization is adopted with respect to Distressed Securities held by a Fund, there can be no","page_number":73,"box":{"x":69,"y":45,"width":797,"height":11}},{"id":"13a3d88b-f5ff-4cd7-8ff7-7209fefc7923","block_type":"box","text":"assurance that the securities or other assets received by a Fund in connection with such exchange offer or plan of","page_number":73,"box":{"x":69,"y":60,"width":816,"height":11}},{"id":"85a85a25-6cde-4b29-a43e-2a3cc0f7cf7e","block_type":"box","text":"reorganization will not have a lower value or income potential than may have been anticipated when the investment","page_number":73,"box":{"x":69,"y":75,"width":821,"height":11}},{"id":"14b7dc9a-c5ad-45f7-8c80-7e4d9ce58f20","block_type":"box","text":"was made or no value. Moreover, any securities received by a Fund upon completion of an exchange offer or plan of","page_number":73,"box":{"x":68,"y":90,"width":827,"height":11}},{"id":"f17d0b3e-85b3-4327-acd4-19bc46513c7a","block_type":"box","text":"reorganization may be restricted as to resale. Similarly, if a Fund par ticipates in negotiations with respect to any","page_number":73,"box":{"x":69,"y":105,"width":800,"height":11}},{"id":"f73ef39c-5187-4e21-879d-5a6f7e6a058c","block_type":"box","text":"exchange offer or plan of reorganization with respect to an issuer of Distressed Securities, the Fund may be","page_number":73,"box":{"x":69,"y":120,"width":770,"height":12}},{"id":"e1cfdd44-4efc-4d7a-ae2b-4685d8d2017c","block_type":"box","text":"restricted from disposing of such securities. To the extent that a Fund becomes involved in such proceedings, the","page_number":73,"box":{"x":69,"y":135,"width":809,"height":12}},{"id":"48f6a834-4f94-4f37-ab43-2162c42851c0","block_type":"box","text":"Fund may have a more active par ticipation in the affairs of the issuer than that assumed generally by an investor. The","page_number":73,"box":{"x":70,"y":150,"width":839,"height":12}},{"id":"482a2f8d-b478-4082-b0c7-53478cbe24f6","block_type":"box","text":"Fund, however, will not make investments for the purpose of exercising day-to-day management of any issuer’s","page_number":73,"box":{"x":70,"y":166,"width":787,"height":11}},{"id":"a2826dfc-6b9c-4e2e-aafb-6889074c095d","block_type":"box","text":"affairs.","page_number":73,"box":{"x":69,"y":181,"width":49,"height":9}},{"id":"37a5a736-2cd5-48f1-ba3a-1e2f8ef27941","block_type":"box","text":"Environmental, Social and Governance (“ESG”) Integration","page_number":73,"box":{"x":102,"y":203,"width":428,"height":11}},{"id":"e930f96c-2efb-4210-996c-1c67d3a34f99","block_type":"box","text":". Although a Fund does not seek to implement a","page_number":73,"box":{"x":531,"y":204,"width":341,"height":11}},{"id":"ccda81e6-cab0-417e-ae9e-5f8e91652ab8","block_type":"box","text":"specific sustainability objective, strategy or process unless disclosed in its Prospectus, Fund management will","page_number":73,"box":{"x":69,"y":218,"width":785,"height":12}},{"id":"3261d3b3-0a59-4667-a66c-70e0581c7438","block_type":"box","text":"consider ESG factors as par t of the investment process for the Fund. Fund management views ESG integration as the","page_number":73,"box":{"x":69,"y":234,"width":838,"height":11}},{"id":"56f3853e-d7b8-464c-8e71-814bf099cebc","block_type":"box","text":"practice of incorporating financially material ESG data or information into investment processes with the objective of","page_number":73,"box":{"x":70,"y":249,"width":827,"height":11}},{"id":"68317ef6-f6e9-45fe-ba06-ebf856701f7a","block_type":"box","text":"enhancing risk-adjusted returns. These ESG considerations will vary depending on a Fund’s par ticular investment","page_number":73,"box":{"x":69,"y":264,"width":806,"height":11}},{"id":"9edb0fc1-cb91-4c46-89ca-7ab727e3194d","block_type":"box","text":"strategies and may include consideration of third-par ty research as well as consideration of proprietary BlackRock","page_number":73,"box":{"x":69,"y":279,"width":812,"height":11}},{"id":"2086e82b-b68c-4c41-ab04-99be076e4126","block_type":"box","text":"research across the ESG risks and oppor tunities regarding an issuer. The ESG characteristics utilized in a Fund’s","page_number":73,"box":{"x":69,"y":294,"width":807,"height":11}},{"id":"d58c1e0a-d4f6-48b0-add0-eed235d5039f","block_type":"box","text":"investment process are anticipated to evolve over time and one or more characteristics may not be relevant with","page_number":73,"box":{"x":70,"y":309,"width":800,"height":11}},{"id":"2bf909db-5c5a-407c-adca-2f4feada8eb4","block_type":"box","text":"respect to all issuers that are eligible for investment.","page_number":73,"box":{"x":69,"y":324,"width":377,"height":12}},{"id":"bc69d922-69c6-4095-bc2b-bb086860e56e","block_type":"box","text":"Cer tain of these considerations may affect a Fund’s exposure to cer tain companies or industries. While Fund","page_number":73,"box":{"x":102,"y":347,"width":778,"height":11}},{"id":"6ee303d4-63be-46f8-a67d-297741d66daa","block_type":"box","text":"management views ESG considerations as having the potential to contribute to a Fund’s long-term per formance,","page_number":73,"box":{"x":69,"y":362,"width":800,"height":11}},{"id":"6ea6c296-debd-4f6c-925f-408c7082940e","block_type":"box","text":"there is no guarantee that such results will be achieved.","page_number":73,"box":{"x":68,"y":377,"width":400,"height":12}},{"id":"1f10ed23-623a-4511-ac19-438b5ec6252f","block_type":"box","text":"Equity Securities.","page_number":73,"box":{"x":102,"y":400,"width":127,"height":11}},{"id":"56db869c-5e65-4aac-bd32-8a9fc17c52d1","block_type":"box","text":"Cer tain Funds may invest in equity securities, which include common stock and, for cer tain","page_number":73,"box":{"x":235,"y":400,"width":648,"height":11}},{"id":"3e55bc33-2043-48fd-aca6-b01403da70e4","block_type":"box","text":"Funds, preferred stock (including conver tible preferred stock); bonds, stock purchase warrants and rights; equity","page_number":73,"box":{"x":70,"y":415,"width":802,"height":11}},{"id":"0cbbbed7-13fc-4482-8452-9bd9c2dd3a68","block_type":"box","text":"interests in trusts; general and limited par tnerships and limited liability companies; and depositary receipts. Stock","page_number":73,"box":{"x":70,"y":430,"width":817,"height":11}},{"id":"43c612fc-5745-428b-86da-44691aecd68e","block_type":"box","text":"markets are volatile. The price of equity securities will fluctuate and can decline and reduce the value of a por tfolio","page_number":73,"box":{"x":69,"y":445,"width":819,"height":11}},{"id":"8835e32a-9b67-4f06-8594-091ab6491815","block_type":"box","text":"investing in equities. The price of equity securities fluctuates based on changes in a company’s financial condition","page_number":73,"box":{"x":70,"y":460,"width":813,"height":12}},{"id":"b1dbbd7a-70c1-495b-9597-94852150a4a2","block_type":"box","text":"and overall market and economic conditions. The value of equity securities purchased by the Fund could decline if the","page_number":73,"box":{"x":69,"y":475,"width":839,"height":12}},{"id":"9f987402-ca94-4e81-b679-f1f6be337155","block_type":"box","text":"financial condition of the companies the Fund invests in decline or if overall market and economic conditions","page_number":73,"box":{"x":68,"y":491,"width":775,"height":11}},{"id":"41c85cfe-5329-4847-aec3-06a6c594863d","block_type":"box","text":"deteriorate. They may also decline due to factors that affect a par ticular industry or industries, such as labor","page_number":73,"box":{"x":69,"y":506,"width":777,"height":11}},{"id":"1dec0bf2-2b4e-419e-9099-39b27df19f82","block_type":"box","text":"shor tages or increase in production costs and competitive conditions within an industry. In addition, they may decline","page_number":73,"box":{"x":69,"y":521,"width":837,"height":11}},{"id":"b5db8ea8-703e-41a5-a618-a799be838d44","block_type":"box","text":"due to general market conditions that are not specifically related to a company or industry, such as real or perceived","page_number":73,"box":{"x":69,"y":536,"width":831,"height":11}},{"id":"35660656-66db-4e26-96ff-9570d73d897c","block_type":"box","text":"adverse economic conditions, changes in the general outlook for corporate earnings, changes in interest or currency","page_number":73,"box":{"x":69,"y":551,"width":829,"height":11}},{"id":"dc79d27d-7311-412f-9459-5117f2ecc0c8","block_type":"box","text":"rates or generally adverse investor sentiment.","page_number":73,"box":{"x":69,"y":566,"width":325,"height":11}},{"id":"c05d8b29-b576-4cc9-ae80-f84cbc5bc17d","block_type":"box","text":"From time to time cer tain of the Funds may invest in shares of companies through initial public offerings","page_number":73,"box":{"x":102,"y":589,"width":745,"height":11}},{"id":"9abf1fca-d46d-475b-9495-e8adb6eee809","block_type":"box","text":"(“IPOs”). IPOs have the potential to produce, and have in fact produced, substantial gains for cer tain Funds. There is","page_number":73,"box":{"x":69,"y":604,"width":833,"height":11}},{"id":"809b35e1-7654-434a-9821-f5c51758209e","block_type":"box","text":"no assurance that any Fund will have continued access to profitable IPOs and therefore investors should not rely on","page_number":73,"box":{"x":69,"y":619,"width":824,"height":11}},{"id":"5b4254c3-85dd-42ef-9e73-c4548f8f5b05","block_type":"box","text":"these past gains as an indication of future per formance. The investment per formance of a Fund during periods when","page_number":73,"box":{"x":68,"y":634,"width":834,"height":12}},{"id":"7ffc38e6-5bcb-4918-8dd7-254018089262","block_type":"box","text":"it is unable to invest significantly or at all in IPOs may be lower than during periods when it is able to do so. In","page_number":73,"box":{"x":70,"y":649,"width":782,"height":12}},{"id":"e72d5f37-f785-457c-a563-0d1622b862b3","block_type":"box","text":"addition, as a Fund increases in size, the impact of IPOs on its per formance will generally decrease. Securities","page_number":73,"box":{"x":69,"y":664,"width":790,"height":12}},{"id":"1b6c1379-9310-4dab-9347-0316b5b2537d","block_type":"box","text":"issued in IPOs are subject to many of the same risks as investing in companies with smaller market capitalizations.","page_number":73,"box":{"x":70,"y":680,"width":823,"height":11}},{"id":"68724378-c3b2-477e-9327-30821d151f9b","block_type":"box","text":"Securities issued in IPOs have no trading history, and information about the companies may be available for very","page_number":73,"box":{"x":69,"y":695,"width":805,"height":11}},{"id":"624ff494-7c29-418c-ac37-cff711d99d74","block_type":"box","text":"limited periods. In addition, the prices of securities sold in IPOs may be highly volatile or may decline shor tly after the","page_number":73,"box":{"x":70,"y":710,"width":836,"height":11}},{"id":"c4c2ed89-62d0-4a05-a73b-89d56e64e7d8","block_type":"box","text":"initial public offering.","page_number":73,"box":{"x":70,"y":725,"width":147,"height":11}},{"id":"15b85736-83e5-4be5-94c9-c7150d120e5b","block_type":"box","text":"The Funds may invest in companies that have relatively small market capitalizations. These organizations will","page_number":73,"box":{"x":101,"y":748,"width":777,"height":11}},{"id":"14d68fcd-2ea6-4b10-8f9f-61500465a1ec","block_type":"box","text":"normally have more limited product lines, markets and financial resources and will be dependent upon a more limited","page_number":73,"box":{"x":69,"y":763,"width":838,"height":11}},{"id":"05922474-d544-48c2-beef-fdcacb3cfde2","block_type":"box","text":"management group than larger capitalized companies. In addition, it is more difficult to get information on smaller","page_number":73,"box":{"x":69,"y":778,"width":815,"height":11}},{"id":"2d6936d7-cefb-4a40-a305-0fc0e4d5bbc7","block_type":"box","text":"companies, which tend to be less well known, have shor ter operating histories, do not have significant ownership by","page_number":73,"box":{"x":69,"y":793,"width":829,"height":11}},{"id":"142ea96d-22f6-4342-bdb3-8bb481df3cc9","block_type":"box","text":"large investors and are followed by relatively few securities analysts. The securities of smaller capitalized companies","page_number":73,"box":{"x":70,"y":808,"width":831,"height":11}},{"id":"764c592d-eb76-4161-8ad8-66ac387a70b3","block_type":"box","text":"are often traded in the OTC markets and may have fewer market makers and wider price spreads. This may result in","page_number":73,"box":{"x":69,"y":823,"width":826,"height":11}},{"id":"20e8b5f2-ead1-4a86-b564-619128dd6622","block_type":"box","text":"greater price movements and less ability to sell a Fund’s investment than if the Fund held the securities of larger,","page_number":73,"box":{"x":68,"y":838,"width":810,"height":12}},{"id":"bce28a49-3d59-4f4e-8ba4-7d664d1cd367","block_type":"box","text":"more established companies.","page_number":73,"box":{"x":69,"y":854,"width":209,"height":10}},{"id":"d224b517-8666-4965-8409-c3f10fda888a","block_type":"box","text":"II-26","page_number":73,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"2d9a1307-efcd-4ac0-90c5-20c7cfd99365","block_type":"box","text":"NM1026U-6033063-73/246","page_number":73,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"9a68de04-b662-4e04-af7f-ec89c054846e","block_type":"box","text":"For a discussion of the types of equity securities in which your Fund may invest and the risks associated with","page_number":74,"box":{"x":102,"y":45,"width":776,"height":11}},{"id":"bcd248c9-d963-4720-94c7-6ab5f405a579","block_type":"box","text":"investing in such equity securities, see your Fund’s Prospectus. Cer tain of the Funds may also invest in shares of","page_number":74,"box":{"x":70,"y":60,"width":810,"height":11}},{"id":"b1c96855-fa3e-42b5-a2d9-afda1d1f3b3e","block_type":"box","text":"private companies, which are subject to the risks of “Illiquid Investments” and “Restricted Securities” described","page_number":74,"box":{"x":70,"y":75,"width":799,"height":11}},{"id":"8df411b7-ccec-4145-895e-a83408ba8997","block_type":"box","text":"below.","page_number":74,"box":{"x":69,"y":90,"width":43,"height":9}},{"id":"91db71b7-dee6-4108-9043-d38f99ffc50f","block_type":"box","text":"Real Estate-Related Securities.","page_number":74,"box":{"x":102,"y":113,"width":219,"height":9}},{"id":"f94162b3-feb8-4613-bb92-a23b6677f4ef","block_type":"box","text":"Although no Fund may invest directly in real estate, cer tain Funds may invest in","page_number":74,"box":{"x":327,"y":113,"width":565,"height":11}},{"id":"f1a2d666-fbc6-434b-871a-c545fd78ef26","block_type":"box","text":"equity securities of issuers that are principally engaged in the real estate industry. Such investments are subject to","page_number":74,"box":{"x":69,"y":128,"width":822,"height":11}},{"id":"44eb5b10-dbc3-48e5-930b-961ec38f506c","block_type":"box","text":"cer tain risks associated with the ownership of real estate and with the real estate industry in general. These risks","page_number":74,"box":{"x":69,"y":143,"width":814,"height":11}},{"id":"96001002-e71e-4fdf-b1f0-7952e0da1d37","block_type":"box","text":"include, among others: possible declines in the value of real estate; risks related to general and local economic","page_number":74,"box":{"x":70,"y":158,"width":796,"height":11}},{"id":"ba22bbea-9935-412f-b140-fdbfde1fbd6a","block_type":"box","text":"conditions; possible lack of availability of mor tgage funds or other limitations on access to capital; overbuilding; risks","page_number":74,"box":{"x":69,"y":173,"width":836,"height":11}},{"id":"72ab39b9-fd31-4935-93a9-eebf0f037c1a","block_type":"box","text":"associated with leverage; market illiquidity; extended vacancies of proper ties; increase in competition, proper ty","page_number":74,"box":{"x":69,"y":188,"width":795,"height":12}},{"id":"1af53bf3-a193-467c-a29a-1ea8fb71e737","block_type":"box","text":"taxes, capital expenditures and operating expenses; changes in zoning laws or other governmental regulation; costs","page_number":74,"box":{"x":68,"y":204,"width":828,"height":11}},{"id":"5d4736b3-aa7f-46e5-820c-f45e0d4c2684","block_type":"box","text":"resulting from the clean-up of, and liability to third par ties for damages resulting from, environmental problems;","page_number":74,"box":{"x":69,"y":218,"width":794,"height":12}},{"id":"49e318a5-18da-4a92-a430-16985285149d","block_type":"box","text":"tenant bankruptcies or other credit problems; casualty or condemnation losses; uninsured damages from floods,","page_number":74,"box":{"x":68,"y":234,"width":805,"height":11}},{"id":"80c4f733-f177-4087-8d2f-8b978dfeb507","block_type":"box","text":"ear thquakes or other natural disasters; limitations on and variations in rents, including decreases in market rates for","page_number":74,"box":{"x":69,"y":249,"width":836,"height":11}},{"id":"a473c89d-516f-46a3-9109-c9b9fddbf18c","block_type":"box","text":"rents; investment in developments that are not completed or that are subject to delays in completion; and changes in","page_number":74,"box":{"x":69,"y":264,"width":838,"height":11}},{"id":"9b5c858c-9694-4120-bb05-350d364fbd31","block_type":"box","text":"interest rates. 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The securities","page_number":74,"box":{"x":70,"y":430,"width":828,"height":11}},{"id":"5ff54ecf-f24a-4f28-b10f-3e881237e0b0","block_type":"box","text":"of smaller or emerging growth companies may be subject to more abrupt or erratic market movements than larger,","page_number":74,"box":{"x":69,"y":445,"width":815,"height":12}},{"id":"724e5dbc-685b-46dd-86d1-897e55b45df0","block_type":"box","text":"more established companies or the market average in general. These companies may have limited product lines,","page_number":74,"box":{"x":69,"y":461,"width":804,"height":11}},{"id":"aad1fae2-db1e-43f8-9611-619188b79867","block_type":"box","text":"markets or financial resources, or they may be dependent on a limited management group.","page_number":74,"box":{"x":69,"y":475,"width":647,"height":12}},{"id":"7f45ebf7-2c0e-4d72-a611-3b01189a96bf","block_type":"box","text":"Investments in smaller or emerging growth companies may involve greater risks and thus may be considered","page_number":74,"box":{"x":102,"y":498,"width":773,"height":11}},{"id":"21ff365c-2548-4bcf-8522-420d45c5fa96","block_type":"box","text":"speculative. Full development of these companies and trends frequently takes time.","page_number":74,"box":{"x":69,"y":513,"width":597,"height":11}},{"id":"b7007fb8-c9d1-4be7-935f-c5ad91f33a91","block_type":"box","text":"Small cap and emerging growth securities will often be traded only in the OTC market or on a regional securities","page_number":74,"box":{"x":102,"y":536,"width":797,"height":11}},{"id":"9d92734d-60e9-45c5-af7d-c0586bd236a2","block_type":"box","text":"exchange and may not be traded every day or in the volume typical of trading on a national securities exchange. As a","page_number":74,"box":{"x":69,"y":551,"width":832,"height":11}},{"id":"2f8db7e2-a751-4fdf-a993-5f246436ca26","block_type":"box","text":"result, the disposition by a Fund of por tfolio securities to meet redemptions or otherwise may require the Fund to","page_number":74,"box":{"x":69,"y":566,"width":808,"height":11}},{"id":"ea249df1-995d-44b0-aded-41b47a0e934c","block_type":"box","text":"make many small sales over a lengthy period of time, or to sell these securities at a discount from market prices or","page_number":74,"box":{"x":69,"y":581,"width":825,"height":12}},{"id":"4647a3ac-5234-46a4-b6a5-a849eb2c3296","block_type":"box","text":"during periods when, in Fund management’s judgment, such disposition is not desirable.","page_number":74,"box":{"x":69,"y":597,"width":631,"height":11}},{"id":"b0324ce6-6497-4290-992a-2ffc11a1693c","block_type":"box","text":"The process of selection and continuous supervision by Fund management does not guarantee successful","page_number":74,"box":{"x":101,"y":619,"width":758,"height":11}},{"id":"c8058ac1-9151-4481-924d-a75af7730ee0","block_type":"box","text":"investment results. Careful initial selection is par ticularly impor tant in this area as many new enterprises have","page_number":74,"box":{"x":70,"y":634,"width":787,"height":11}},{"id":"44d1ba70-e89f-4d70-81dd-ba6735e8aa00","block_type":"box","text":"promise but lack cer tain of the fundamental factors necessary to prosper. Investing in small cap and emerging","page_number":74,"box":{"x":70,"y":649,"width":789,"height":12}},{"id":"611f5177-99a9-48be-8581-a0e42f710c02","block_type":"box","text":"growth companies requires specialized research and analysis.","page_number":74,"box":{"x":68,"y":665,"width":442,"height":11}},{"id":"e82b6670-643b-4e3c-a63f-31fcb7d3c810","block_type":"box","text":"Fund management believes that relatively small companies may have the oppor tunity to develop into significant","page_number":74,"box":{"x":102,"y":687,"width":795,"height":11}},{"id":"87a79337-ab9e-4f7e-8b74-0d20a3b42e72","block_type":"box","text":"business enterprises. A Fund may invest in securities of small issuers in the relatively early stages of business","page_number":74,"box":{"x":69,"y":702,"width":791,"height":12}},{"id":"6749557b-8f3b-4c37-8960-997341c83523","block_type":"box","text":"development that have a new technology, a unique or proprietary product or service, or a favorable market position.","page_number":74,"box":{"x":69,"y":717,"width":823,"height":12}},{"id":"473a738a-b9b4-4570-b186-0065034af734","block_type":"box","text":"Equity securities of specific small cap issuers may present different oppor tunities for long-term capital","page_number":74,"box":{"x":102,"y":740,"width":729,"height":11}},{"id":"e12c66d8-86ac-4613-9a34-c1a4e9f52981","block_type":"box","text":"appreciation during varying por tions of economic or securities market cycles, as well as during varying stages of their","page_number":74,"box":{"x":69,"y":755,"width":837,"height":11}},{"id":"1fffa847-5c72-47f9-ad49-ca215261b6cd","block_type":"box","text":"business development. The market valuation of small cap issuers tends to fluctuate during economic or market","page_number":74,"box":{"x":69,"y":770,"width":794,"height":12}},{"id":"974248e6-af6f-405b-bc37-3c9d3c1ebd7a","block_type":"box","text":"cycles.","page_number":74,"box":{"x":69,"y":786,"width":46,"height":11}},{"id":"fd36f087-6f44-4886-a895-c4db5e5dfc12","block_type":"box","text":"Tracking Stocks","page_number":74,"box":{"x":103,"y":808,"width":110,"height":11}},{"id":"d0132440-5660-4d20-a1a6-efc9cc0475f0","block_type":"box","text":". A tracking stock is a separate class of common stock whose value is linked to a specific","page_number":74,"box":{"x":214,"y":808,"width":640,"height":11}},{"id":"dd5f9073-9cb1-4d0d-977e-33e5afa6a5ff","block_type":"box","text":"business unit or operating division within a larger company and is designed to “track” the per formance of such","page_number":74,"box":{"x":69,"y":823,"width":791,"height":12}},{"id":"59c6ad40-7578-4e7d-a293-0166467258bc","block_type":"box","text":"business unit or division. The tracking stock may pay dividends to shareholders independent of the parent company.","page_number":74,"box":{"x":69,"y":838,"width":826,"height":12}},{"id":"4972c9e4-698e-46c4-9a8b-7e90e58fa53c","block_type":"box","text":"The parent company, rather than the business unit or division, generally is the issuer of tracking stock. However,","page_number":74,"box":{"x":68,"y":853,"width":801,"height":12}},{"id":"f947e8e2-5abd-442a-a361-8be1b12b226c","block_type":"box","text":"holders of the tracking stock may not have the same rights as holders of the company’s common stock.","page_number":74,"box":{"x":69,"y":869,"width":740,"height":11}},{"id":"9d68531e-d2ae-4b87-b79d-cb550c262428","block_type":"box","text":"Exchange-Traded Notes (“ETNs”).","page_number":74,"box":{"x":102,"y":891,"width":245,"height":11}},{"id":"6d748868-1ac2-4702-b187-b15eabc9465d","block_type":"box","text":"Cer tain Funds may invest in ETNs. ETNs are generally notes representing","page_number":74,"box":{"x":354,"y":891,"width":521,"height":12}},{"id":"63effa0c-64ee-4878-b76f-2048d992a116","block_type":"box","text":"debt of the issuer, usually a financial institution. ETNs combine aspects of both bonds and ETFs. An ETN’s returns","page_number":74,"box":{"x":69,"y":906,"width":814,"height":12}},{"id":"7a5c306f-b7c9-4795-89a8-5e1c7ccf05cd","block_type":"box","text":"II-27","page_number":74,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"c9a60e1a-b792-4a51-ad58-c55eac21b81d","block_type":"box","text":"NM1026U-6033063-74/246","page_number":74,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"289efcec-c745-4dd0-8d28-d08f34ef0a80","block_type":"box","text":"are based on the per formance of one or more underlying assets, reference rates or indexes, minus fees and","page_number":75,"box":{"x":69,"y":45,"width":774,"height":11}},{"id":"311a9ba1-cf69-49de-9739-8a4ecfcf869f","block_type":"box","text":"expenses. Similar to ETFs, ETNs are listed on an exchange and traded in the secondary market. However, unlike an","page_number":75,"box":{"x":69,"y":60,"width":822,"height":11}},{"id":"06e75317-0e21-4bcb-b50f-a5c4d834fd8b","block_type":"box","text":"ETF, an ETN can be held until the ETN’s maturity, at which time the issuer will pay a return linked to the per formance","page_number":75,"box":{"x":70,"y":75,"width":831,"height":11}},{"id":"9eb0872d-0548-4477-8eb7-a46239ed7dae","block_type":"box","text":"of the specific asset, index or rate (“reference instrument”) to which the ETN is linked minus cer tain fees. Unlike","page_number":75,"box":{"x":69,"y":90,"width":805,"height":11}},{"id":"1812048d-b99c-4107-b0fb-6677a3ebda2c","block_type":"box","text":"regular bonds, ETNs do not make periodic interest payments, and principal is not protected.","page_number":75,"box":{"x":69,"y":105,"width":654,"height":11}},{"id":"590d31fd-6d51-4850-8fcf-65bc050f16c3","block_type":"box","text":"The value of an ETN may be influenced by, among other things, time to maturity, level of supply and demand for","page_number":75,"box":{"x":101,"y":128,"width":794,"height":11}},{"id":"b4a8682e-ddcc-4999-915d-0c77d5215beb","block_type":"box","text":"the ETN, volatility and lack of liquidity in underlying markets, changes in the applicable interest rates, the","page_number":75,"box":{"x":68,"y":143,"width":748,"height":11}},{"id":"cbfa1480-87c0-4d4f-b500-a827fc1edcfb","block_type":"box","text":"per formance of the reference instrument, changes in the issuer’s credit rating and economic, legal, political or","page_number":75,"box":{"x":70,"y":158,"width":789,"height":11}},{"id":"8360800e-a8a4-4873-9532-d2542795235f","block_type":"box","text":"geographic events that affect the reference instrument. ETNs are subject to credit risk and the value of the ETN may","page_number":75,"box":{"x":68,"y":173,"width":831,"height":11}},{"id":"78e89273-2aba-4a85-a7f6-997a669c0041","block_type":"box","text":"drop due to a downgrade in an issuer’s credit rating, despite the underlying reference instrument remaining","page_number":75,"box":{"x":69,"y":188,"width":766,"height":12}},{"id":"58fd2856-6bbc-46af-bc4c-70c16679bb1e","block_type":"box","text":"unchanged. When a Fund invests in ETNs, it will bear its propor tionate share of any fees and expenses borne by the","page_number":75,"box":{"x":69,"y":203,"width":828,"height":12}},{"id":"1da48434-1475-4d74-bebb-3108aedb2402","block_type":"box","text":"ETN.","page_number":75,"box":{"x":70,"y":219,"width":30,"height":8}},{"id":"48ecadc5-fbf6-4b77-b770-823e4a667380","block_type":"box","text":"An ETN that is tied to a reference instrument may not replicate the per formance of the reference instrument.","page_number":75,"box":{"x":101,"y":241,"width":776,"height":11}},{"id":"5004c046-89a5-4412-98b9-daba2013ba93","block_type":"box","text":"ETNs also incur cer tain expenses not incurred by their applicable reference instrument. Some ETNs that use leverage","page_number":75,"box":{"x":70,"y":256,"width":837,"height":12}},{"id":"90a431f8-6daf-41ab-aa39-6d6c9430864a","block_type":"box","text":"may, at times, be illiquid and may be difficult to purchase or sell at a fair price. Levered ETNs are subject to the same","page_number":75,"box":{"x":69,"y":271,"width":840,"height":12}},{"id":"9c694ae1-1ae6-4355-9670-d6363b3f6680","block_type":"box","text":"risk as other instruments that use leverage in any form. While leverage allows for greater potential return, the","page_number":75,"box":{"x":69,"y":286,"width":781,"height":12}},{"id":"e384df75-f431-4f53-85ef-7fbc58a9f26f","block_type":"box","text":"potential for loss is also greater. Finally, additional losses may be incurred if the investment loses value because, in","page_number":75,"box":{"x":70,"y":302,"width":827,"height":11}},{"id":"811d9392-5029-4c2b-8bc4-167f10e99a7b","block_type":"box","text":"addition to the money lost on the investment, the loan still needs to be repaid.","page_number":75,"box":{"x":69,"y":317,"width":560,"height":11}},{"id":"6240d5a1-76ba-44cd-9851-d6cfe4043bfe","block_type":"box","text":"Because the return on the ETN is dependent on the issuer’s ability or willingness to meet its obligations, the","page_number":75,"box":{"x":102,"y":340,"width":774,"height":11}},{"id":"96751030-759a-4d01-a4b5-11bcf9dbb111","block_type":"box","text":"value of the ETN may change due to a change in the issuer’s credit rating, despite no change in the underlying","page_number":75,"box":{"x":68,"y":355,"width":788,"height":11}},{"id":"03e29912-ca04-46e8-ac27-e55640f2e461","block_type":"box","text":"reference instrument. The market value of ETN shares may differ from the value of the reference instrument. This","page_number":75,"box":{"x":69,"y":370,"width":810,"height":11}},{"id":"14b148ad-cdfc-4903-9b2a-eff2e63c9c7f","block_type":"box","text":"difference in price may be due to the fact that the supply and demand in the market for ETN shares at any point in","page_number":75,"box":{"x":69,"y":385,"width":815,"height":11}},{"id":"6f9da264-976a-49cb-9497-628ce256b660","block_type":"box","text":"time is not always identical to the supply and demand in the market for the assets underlying the reference","page_number":75,"box":{"x":68,"y":400,"width":766,"height":11}},{"id":"dcc581d4-846e-455c-b7f0-21bcc4edd68b","block_type":"box","text":"instrument that the ETN seeks to track.","page_number":75,"box":{"x":70,"y":415,"width":279,"height":9}},{"id":"50c6e8cc-07f0-4985-b527-6af881ed61d5","block_type":"box","text":"There may be restrictions on the Fund’s right to redeem its investment in an ETN, which are generally meant to","page_number":75,"box":{"x":101,"y":438,"width":791,"height":11}},{"id":"6c32573b-8b5a-4147-8ad6-d202ed48cac5","block_type":"box","text":"be held until maturity. The Fund’s decision to sell its ETN holdings may be limited by the availability of a secondary","page_number":75,"box":{"x":69,"y":453,"width":818,"height":11}},{"id":"d34504bc-5125-4fdb-b53c-4bc2d157a7f4","block_type":"box","text":"market. An investor in an ETN could lose some or all of the amount invested.","page_number":75,"box":{"x":69,"y":468,"width":547,"height":9}},{"id":"5942f598-629a-4209-b03d-b15a261548f7","block_type":"box","text":"ETNs are also subject to tax risks. The Internal Revenue Service (the “IRS”) may not accept, and a cour t may not","page_number":75,"box":{"x":102,"y":491,"width":807,"height":11}},{"id":"47c50edc-5a6c-4633-a57d-e5ba44dfabbe","block_type":"box","text":"uphold, how the Funds characterize and treat ETNs for tax purposes. The timing and character of income and gains","page_number":75,"box":{"x":69,"y":506,"width":819,"height":11}},{"id":"9f4b4738-5b5e-450b-95e3-0f0469d8ee06","block_type":"box","text":"derived by a Fund from investments in ETNs may be affected by future legislation.","page_number":75,"box":{"x":69,"y":521,"width":581,"height":11}},{"id":"53127847-a224-4b1b-be13-462ac92ab044","block_type":"box","text":"Foreign Investments.","page_number":75,"box":{"x":102,"y":544,"width":152,"height":11}},{"id":"7c1d4b0c-ce25-4afb-9822-88e12b0f0bef","block_type":"box","text":"Foreign Investment Risks.","page_number":75,"box":{"x":102,"y":566,"width":182,"height":11}},{"id":"685003d2-9828-4537-b675-b4ee9bf30df7","block_type":"box","text":"Cer tain Funds may invest in foreign securities, including securities from issuers","page_number":75,"box":{"x":291,"y":566,"width":567,"height":11}},{"id":"cc8323de-c41c-4202-9c32-fdbaf87483a4","block_type":"box","text":"located in emerging market countries. These securities may be denominated in U.S. dollars or in a foreign currency.","page_number":75,"box":{"x":70,"y":581,"width":822,"height":12}},{"id":"83b6faca-e9e5-473f-8a6a-a62e22d2bf0e","block_type":"box","text":"Investing in foreign securities involves risks not typically associated with investing in securities of companies","page_number":75,"box":{"x":70,"y":596,"width":774,"height":12}},{"id":"4c9d38a1-43a7-494c-b893-5c50e5e6d0c0","block_type":"box","text":"organized and operated in the United States that can increase the chances that a Fund will lose money.","page_number":75,"box":{"x":69,"y":612,"width":738,"height":11}},{"id":"80c537ff-cd3d-4900-b9e8-7a2a6f711445","block_type":"box","text":"Securities issued by cer tain companies organized outside the United States may not be deemed to be foreign","page_number":75,"box":{"x":102,"y":634,"width":782,"height":12}},{"id":"5cb31582-5432-49f1-b007-9ebd90afb426","block_type":"box","text":"securities (but rather deemed to be U.S. securities) if (i) the company’s principal operations are conducted from the","page_number":75,"box":{"x":69,"y":649,"width":824,"height":12}},{"id":"47ae1992-45f1-4b2f-9d4d-11fe6dc555d2","block_type":"box","text":"U.S., (ii) the company’s equity securities trade principally on a U.S. stock exchange, (iii) the company does a","page_number":75,"box":{"x":70,"y":665,"width":771,"height":11}},{"id":"dd71f0fe-d9b4-4118-b9c6-ba764d993e38","block_type":"box","text":"substantial amount of business in the U.S. or (iv) the issuer of securities is included in the Fund’s primary U.S.","page_number":75,"box":{"x":69,"y":680,"width":792,"height":11}},{"id":"e837ffe6-ad6b-4a02-9157-3ad7d2d7f03a","block_type":"box","text":"benchmark index.","page_number":75,"box":{"x":69,"y":695,"width":124,"height":9}},{"id":"f8ab78b6-1052-466a-a531-7407f6789e36","block_type":"box","text":"In addition to equity securities, foreign investments of the Funds may include: (a) debt obligations issued or","page_number":75,"box":{"x":102,"y":717,"width":767,"height":12}},{"id":"4250bedb-5df9-48c9-a8d4-0feadccd223d","block_type":"box","text":"guaranteed by foreign sovereign governments or their agencies, authorities, instrumentalities or political","page_number":75,"box":{"x":68,"y":732,"width":742,"height":12}},{"id":"7ffbe3f1-9049-4120-b8ee-59084021d678","block_type":"box","text":"subdivisions, including a foreign state, province or municipality; (b) debt obligations of supranational organizations;","page_number":75,"box":{"x":69,"y":748,"width":818,"height":11}},{"id":"f07d43c2-1b7d-4ac8-8700-652d283d8cbe","block_type":"box","text":"(c) debt obligations of foreign banks and bank holding companies; (d) debt obligations of domestic banks and","page_number":75,"box":{"x":69,"y":763,"width":780,"height":11}},{"id":"6613e2ed-427e-4b04-9938-c0e052ba8152","block_type":"box","text":"corporations issued in foreign currencies; (e) debt obligations denominated in the Euro; and (f) foreign corporate debt","page_number":75,"box":{"x":69,"y":778,"width":837,"height":11}},{"id":"ef22a3da-f126-4249-9c45-b08d95fe323c","block_type":"box","text":"securities and commercial paper. Such securities may include loan par ticipations and assignments, conver tible","page_number":75,"box":{"x":69,"y":793,"width":794,"height":11}},{"id":"54ab6281-73ea-42ee-834b-cc3901aed01e","block_type":"box","text":"securities and zero-coupon securities.","page_number":75,"box":{"x":69,"y":808,"width":268,"height":11}},{"id":"d18b2519-b91e-4c7e-879c-019abb3e9a28","block_type":"box","text":"Dividends or interest on, or proceeds from the sale of, foreign securities may be subject to foreign withholding","page_number":75,"box":{"x":102,"y":831,"width":785,"height":11}},{"id":"0643c553-1e43-4901-85e5-124e19d0c0ee","block_type":"box","text":"taxes.","page_number":75,"box":{"x":68,"y":847,"width":42,"height":8}},{"id":"00e8051e-5fcb-4f39-a18d-234b2fd050fd","block_type":"box","text":"To the extent that the underlying securities or other instruments held by a Fund trade on foreign exchanges or in","page_number":75,"box":{"x":101,"y":869,"width":798,"height":11}},{"id":"d2ef257b-0214-4921-b281-ea53e07c89d8","block_type":"box","text":"foreign markets that are closed when the securities exchange on which the Fund’s shares trade is open, there are","page_number":75,"box":{"x":68,"y":884,"width":815,"height":11}},{"id":"b748e34c-5f39-4ac8-b259-0903ccd0074b","block_type":"box","text":"likely to be deviations between the current price of such an underlying security and the last quoted price for the","page_number":75,"box":{"x":70,"y":899,"width":792,"height":11}},{"id":"5f8fedb3-65ad-4c29-b17d-486db3d6f2fa","block_type":"box","text":"II-28","page_number":75,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"21d9bf7e-5b75-45fc-8528-7365263f2077","block_type":"box","text":"NM1026U-6033063-75/246","page_number":75,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"73b85ba4-e3a1-4216-aee1-3c33ee3ab173","block_type":"box","text":"underlying security (","page_number":76,"box":{"x":69,"y":45,"width":140,"height":11}},{"id":"98f190f0-bed5-4b67-b940-e9d3e23aba07","block_type":"box","text":"i.e.","page_number":76,"box":{"x":211,"y":45,"width":20,"height":9}},{"id":"34fabd9b-3f1c-4667-91e9-268082c459a4","block_type":"box","text":", the Fund’s quote from the closed foreign market). The impact of a closed foreign market on a","page_number":76,"box":{"x":234,"y":45,"width":675,"height":11}},{"id":"81c2bfe8-7cc8-43d9-8259-ec7b111ed378","block_type":"box","text":"Fund is likely to be greater where a large por tion of the Fund’s underlying securities or other instruments trade on","page_number":76,"box":{"x":70,"y":60,"width":809,"height":11}},{"id":"e03d6d1f-05e8-4d91-af3f-89800f7e3a6d","block_type":"box","text":"that closed foreign market or when the foreign market is closed for unscheduled reasons. These deviations may","page_number":76,"box":{"x":68,"y":75,"width":800,"height":11}},{"id":"f2131e45-83db-4c0b-9b7e-49afac2538f1","block_type":"box","text":"result in premiums or discounts to cer tain Funds’ NAVs that may be greater than those experienced by other ETFs.","page_number":76,"box":{"x":69,"y":90,"width":815,"height":11}},{"id":"97b95d7b-6418-4127-addd-6630f68ee7b1","block_type":"box","text":"Foreign Market Risk.","page_number":76,"box":{"x":102,"y":113,"width":144,"height":11}},{"id":"3e03ace9-f828-418e-9044-62fc0a083141","block_type":"box","text":"Funds that may invest in foreign securities offer the potential for more diversification than a","page_number":76,"box":{"x":254,"y":113,"width":652,"height":11}},{"id":"9d1f26b5-f644-430e-b695-be0276a7b506","block_type":"box","text":"Fund that invests only in the United States because securities traded on foreign markets have often (though not","page_number":76,"box":{"x":70,"y":128,"width":797,"height":11}},{"id":"186fdfcc-7422-4072-bbf0-a3773e383264","block_type":"box","text":"always) per formed differently from securities traded in the United States. However, such investments often involve","page_number":76,"box":{"x":69,"y":143,"width":817,"height":11}},{"id":"30a9bb3e-95e9-419b-84f0-679baff4789f","block_type":"box","text":"risks not present in U.S. investments that can increase the chances that a Fund will lose money. In par ticular, a Fund","page_number":76,"box":{"x":69,"y":158,"width":836,"height":11}},{"id":"c396ad08-eba8-4e0a-be68-4a9c92a8bb30","block_type":"box","text":"is subject to the risk that, because there are generally fewer investors on foreign exchanges and a smaller number of","page_number":76,"box":{"x":70,"y":173,"width":835,"height":11}},{"id":"c1df9456-2b3d-4bbb-b376-d17c1be624cd","block_type":"box","text":"shares traded each day, it may be difficult for the Fund to buy and sell securities on those exchanges. In addition,","page_number":76,"box":{"x":69,"y":188,"width":810,"height":12}},{"id":"444f5707-78f5-4584-abe4-c628f37d8efd","block_type":"box","text":"prices of foreign securities may fluctuate more than prices of securities traded in the United States. Investments in","page_number":76,"box":{"x":70,"y":203,"width":820,"height":12}},{"id":"8f546936-225a-4c46-b09b-9db07ccf47fe","block_type":"box","text":"foreign markets may also be adversely affected by governmental actions such as the imposition of punitive taxes or","page_number":76,"box":{"x":68,"y":218,"width":826,"height":12}},{"id":"615d2775-32d6-4761-b429-80804b07e7e7","block_type":"box","text":"tariffs. In addition, economic conditions, such as volatile currency exchange rates and interest rates, political events,","page_number":76,"box":{"x":68,"y":234,"width":836,"height":11}},{"id":"a41a57e4-1932-4f15-99fd-35a983d58bf2","block_type":"box","text":"military action and other conditions may, without prior warning, lead to the governments of cer tain countries, or the","page_number":76,"box":{"x":69,"y":249,"width":821,"height":11}},{"id":"e89a28e9-5dab-4b12-9b0d-fd265c8474be","block_type":"box","text":"U.S. Government with respect to cer tain countries, prohibiting or imposing substantial restrictions through capital","page_number":76,"box":{"x":70,"y":264,"width":807,"height":11}},{"id":"a7bd2aa3-fd90-4212-8304-ecce0e08e175","block_type":"box","text":"controls and/or sanctions on foreign investing in the capital markets or cer tain industries in those countries. Capital","page_number":76,"box":{"x":69,"y":279,"width":830,"height":11}},{"id":"a00ac627-198f-4b00-a8ce-fe167af87b1e","block_type":"box","text":"controls and/or sanctions may include the prohibition of, or restrictions on, the ability to own or transfer currency,","page_number":76,"box":{"x":69,"y":294,"width":810,"height":11}},{"id":"47fb1773-6263-461a-9114-01e7f5b43672","block_type":"box","text":"securities, derivatives or other assets and may also include retaliatory actions of one government against another","page_number":76,"box":{"x":69,"y":309,"width":813,"height":11}},{"id":"8246b76c-10c4-427a-8f50-3bd1069683aa","block_type":"box","text":"government, such as seizure of assets. Any of these actions could severely impair a Fund’s ability to purchase, sell,","page_number":76,"box":{"x":68,"y":324,"width":828,"height":12}},{"id":"b84156a9-9949-4dd1-91ef-76c6cb30336f","block_type":"box","text":"transfer, receive, deliver or otherwise obtain exposure to foreign securities and assets, including the ability to","page_number":76,"box":{"x":68,"y":339,"width":782,"height":12}},{"id":"36b166c8-6dda-4e78-ada0-7e9d56afa380","block_type":"box","text":"transfer the Fund’s assets or income back into the United States, and could negatively impact the value and/or","page_number":76,"box":{"x":68,"y":355,"width":796,"height":11}},{"id":"236ea35f-458f-49a4-b4ad-838d239824cc","block_type":"box","text":"liquidity of such assets or otherwise adversely affect a Fund’s operations, causing the Fund to decline in value. Other","page_number":76,"box":{"x":70,"y":370,"width":837,"height":11}},{"id":"0d886172-66cf-4390-9687-bd1ecbca05c7","block_type":"box","text":"potential foreign market risks include exchange controls, difficulties in pricing securities, defaults on foreign","page_number":76,"box":{"x":70,"y":385,"width":768,"height":11}},{"id":"a20e478d-239e-411c-8562-f93b2b2a76db","block_type":"box","text":"government securities, difficulties in enforcing favorable legal judgments in foreign cour ts, and political and social","page_number":76,"box":{"x":68,"y":400,"width":813,"height":11}},{"id":"d1ffe203-e030-43ec-8c07-23f1a5bc0bb6","block_type":"box","text":"conditions, such as diplomatic relations, confiscatory taxation, expropriation, limitation on the removal of funds or","page_number":76,"box":{"x":69,"y":415,"width":814,"height":11}},{"id":"69e14e60-1d17-4c92-b831-645e39eb9645","block_type":"box","text":"assets, or imposition of (or change in) exchange control regulations. Legal remedies available to investors in cer tain","page_number":76,"box":{"x":69,"y":430,"width":828,"height":11}},{"id":"66154f61-ab88-47e6-acb2-fa5970f91078","block_type":"box","text":"foreign countries may be less extensive than those available to investors in the United States or other foreign","page_number":76,"box":{"x":68,"y":445,"width":782,"height":12}},{"id":"46075cdf-01f3-4311-aa76-14d97b5355ca","block_type":"box","text":"countries. In addition, changes in government administrations or economic or monetary policies in the United States","page_number":76,"box":{"x":69,"y":460,"width":830,"height":12}},{"id":"1f22f8bb-ab38-47af-b6a9-b5d239a30415","block_type":"box","text":"or abroad could result in appreciation or depreciation of por tfolio securities and could favorably or adversely affect a","page_number":76,"box":{"x":69,"y":475,"width":829,"height":12}},{"id":"56064ee5-5836-4c88-8f85-be489d559807","block_type":"box","text":"Fund’s operations.","page_number":76,"box":{"x":70,"y":491,"width":130,"height":11}},{"id":"85895d61-bb59-46c5-9f73-7a8e241bf486","block_type":"box","text":"Foreign Economy Risk.","page_number":76,"box":{"x":102,"y":514,"width":158,"height":11}},{"id":"3afc289b-a8bd-477c-a6ed-cb285bc41a4e","block_type":"box","text":"The economies of cer tain foreign markets often do not compare favorably with that of the","page_number":76,"box":{"x":267,"y":513,"width":636,"height":12}},{"id":"76fabde8-0b75-475d-8c59-4f3feccb26b0","block_type":"box","text":"United States with respect to such issues as growth of gross national product, reinvestment of capital, resources,","page_number":76,"box":{"x":70,"y":528,"width":812,"height":12}},{"id":"c70671ba-d254-44b6-b974-3f8dd12c310e","block_type":"box","text":"and balance of payments position. Cer tain such economies may rely heavily on par ticular industries or foreign capital","page_number":76,"box":{"x":69,"y":543,"width":835,"height":12}},{"id":"8a57d2e5-e335-432a-b3d9-4431ec12d7c1","block_type":"box","text":"and are more vulnerable to diplomatic developments, the imposition of economic sanctions against a par ticular","page_number":76,"box":{"x":69,"y":559,"width":795,"height":11}},{"id":"d4d0032b-adda-49f9-9936-f9fd12f71bdc","block_type":"box","text":"country or countries, changes in international trading patterns, trade barriers, and other protectionist or retaliatory","page_number":76,"box":{"x":69,"y":574,"width":817,"height":11}},{"id":"0430b13b-52d7-42d2-904f-3ff210ff79a3","block_type":"box","text":"measures.","page_number":76,"box":{"x":69,"y":591,"width":74,"height":7}},{"id":"ede38499-0b17-4271-90fd-4015ac8aaac3","block_type":"box","text":"Currency Risk and Exchange Risk.","page_number":76,"box":{"x":102,"y":612,"width":240,"height":11}},{"id":"cf47f259-075a-49f7-a93e-70efafc6f93d","block_type":"box","text":"Because foreign securities generally are denominated and pay dividends or","page_number":76,"box":{"x":349,"y":612,"width":534,"height":11}},{"id":"1b3f2e24-e0fc-4770-b302-6ffa5710afde","block_type":"box","text":"interest in foreign currencies, the value of a Fund that invests in foreign securities as measured in U.S. dollars will be","page_number":76,"box":{"x":70,"y":627,"width":838,"height":11}},{"id":"8f7cfeab-093d-45e6-9d69-5b475b1bdfb5","block_type":"box","text":"affected favorably or unfavorably by changes in exchange rates. Generally, when the U.S. dollar rises in value against","page_number":76,"box":{"x":69,"y":642,"width":833,"height":11}},{"id":"3fd2c255-9294-4a87-80b7-8874cf1a338e","block_type":"box","text":"a foreign currency, a security denominated in that currency loses value because the currency is wor th fewer U.S.","page_number":76,"box":{"x":69,"y":657,"width":801,"height":11}},{"id":"ea2e67d6-bd1a-49ed-be8f-b9a9ab1d214b","block_type":"box","text":"dollars. Conversely, when the U.S. dollar decreases in value against a foreign currency, a security denominated in","page_number":76,"box":{"x":69,"y":672,"width":808,"height":11}},{"id":"e2a55561-469e-4ee7-ab6d-8c819b04d277","block_type":"box","text":"that currency gains value because the currency is wor th more U.S. dollars. This risk, generally known as “currency","page_number":76,"box":{"x":68,"y":687,"width":816,"height":11}},{"id":"7752aab5-1374-4288-ade4-b4cc0901557e","block_type":"box","text":"risk,” means that a stronger U.S. dollar will reduce returns for U.S. investors while a weak U.S. dollar will increase","page_number":76,"box":{"x":69,"y":702,"width":814,"height":12}},{"id":"432237ef-35c9-4836-ab83-ad13204427a9","block_type":"box","text":"those returns. Currency exchange rates can also be affected unpredictably by intervention by U.S. or foreign","page_number":76,"box":{"x":68,"y":717,"width":771,"height":12}},{"id":"61ae5ede-b2a4-44f3-ac8f-b78fd10d018d","block_type":"box","text":"governments or central banks, or the failure to intervene, or buy currency controls or political developments in the","page_number":76,"box":{"x":68,"y":732,"width":813,"height":12}},{"id":"06cc718d-4902-4948-b797-30d56047f650","block_type":"box","text":"United States or abroad.","page_number":76,"box":{"x":70,"y":748,"width":172,"height":9}},{"id":"91e30bbf-009f-46af-99d2-1fbbb61699eb","block_type":"box","text":"Governmental Supervision and Regulation/Accounting Standards.","page_number":76,"box":{"x":102,"y":770,"width":466,"height":12}},{"id":"9e364c3a-433f-4ea6-816c-1fffd8401db8","block_type":"box","text":"Many foreign governments supervise and","page_number":76,"box":{"x":575,"y":770,"width":293,"height":12}},{"id":"dc4d770f-858e-4e75-8a29-7ba0bb3a4a12","block_type":"box","text":"regulate stock exchanges, brokers and the sale of securities less than does the United States. Some countries may","page_number":76,"box":{"x":69,"y":785,"width":828,"height":12}},{"id":"3f8e41cd-19dd-440a-aaed-8d6c8767c68a","block_type":"box","text":"not have laws to protect investors comparable to the U.S. securities laws. For example, some foreign countries may","page_number":76,"box":{"x":69,"y":801,"width":826,"height":11}},{"id":"5864fc19-e3a4-4529-8b58-303fc51b2634","block_type":"box","text":"have no laws or rules against insider trading. Insider trading occurs when a person buys or sells a company’s","page_number":76,"box":{"x":69,"y":816,"width":778,"height":11}},{"id":"fcc730fe-34fc-4f88-b09a-4830335c3b66","block_type":"box","text":"securities based on nonpublic information about that company. Accounting standards in other countries are not","page_number":76,"box":{"x":69,"y":831,"width":794,"height":11}},{"id":"231ad7f5-1b4a-479e-8070-d5312752fda4","block_type":"box","text":"necessarily the same as in the United States. If the accounting standards in another country do not require as much","page_number":76,"box":{"x":69,"y":846,"width":831,"height":11}},{"id":"a29531c7-a07e-48e5-9fbd-e13da7ed3a05","block_type":"box","text":"detail as U.S. accounting standards, it may be harder for Fund management to completely and accurately determine a","page_number":76,"box":{"x":69,"y":861,"width":840,"height":11}},{"id":"7303a328-f72a-40c5-a8de-9fbb6fc17a7b","block_type":"box","text":"company’s financial condition. In addition, the U.S. Government has from time to time in the past imposed","page_number":76,"box":{"x":69,"y":876,"width":760,"height":11}},{"id":"860e0759-af44-44e4-9278-cf911f2e6273","block_type":"box","text":"restrictions, through penalties and otherwise, on foreign investments by U.S. investors such as the Fund. If such","page_number":76,"box":{"x":69,"y":891,"width":803,"height":12}},{"id":"7eb2732b-555b-4818-bed4-f83d7bf55573","block_type":"box","text":"restrictions should be reinstituted, it might become necessary for the Fund to invest all or substantially all of its","page_number":76,"box":{"x":69,"y":906,"width":798,"height":12}},{"id":"d00f9ac0-64bc-4771-86b6-cf5a30559f64","block_type":"box","text":"II-29","page_number":76,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"45eade1d-f6b5-4738-85b2-c81565aef642","block_type":"box","text":"NM1026U-6033063-76/246","page_number":76,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"bec63369-d245-4aed-8bee-2574386f4658","block_type":"box","text":"assets in U.S. securities. Also, brokerage commissions and other costs of buying or selling securities often are","page_number":77,"box":{"x":69,"y":45,"width":793,"height":11}},{"id":"96b2716e-cf22-43b2-b2dc-019dd41fe25f","block_type":"box","text":"higher in foreign countries than they are in the United States. This reduces the amount the Fund can earn on its","page_number":77,"box":{"x":69,"y":60,"width":797,"height":11}},{"id":"5e3d2d9a-96fc-42b1-abbe-bfe0f9d40efd","block_type":"box","text":"investments.","page_number":77,"box":{"x":70,"y":75,"width":89,"height":9}},{"id":"5a0c5814-0082-474a-83d6-e7839a5dde66","block_type":"box","text":"Cer tain Risks of Holding Fund Assets Outside the United States.","page_number":77,"box":{"x":102,"y":98,"width":458,"height":11}},{"id":"e44252d8-aa3c-41e6-9a29-6f8b30f0d5ee","block_type":"box","text":"A Fund generally holds its foreign securities and","page_number":77,"box":{"x":566,"y":98,"width":341,"height":11}},{"id":"ad3c1932-f566-409f-bd17-ffdbaf57e6fa","block_type":"box","text":"cash in foreign banks and securities depositories. Some foreign banks and securities depositories may be recently","page_number":77,"box":{"x":69,"y":113,"width":819,"height":11}},{"id":"1f0aa62d-ec6d-436b-b38e-66dc276a90d9","block_type":"box","text":"organized or new to the foreign custody business. In addition, there may be limited or no regulatory oversight over","page_number":77,"box":{"x":69,"y":128,"width":813,"height":11}},{"id":"0ed946a1-6677-4e43-9cc8-204bd07c7c47","block_type":"box","text":"their operations. Also, the laws of cer tain countries may put limits on a Fund’s ability to recover its assets if a foreign","page_number":77,"box":{"x":68,"y":143,"width":838,"height":11}},{"id":"4409483e-3ead-4934-92bd-31963c7bccf1","block_type":"box","text":"bank or depository or issuer of a security or any of their agents goes bankrupt. In addition, it is often more expensive","page_number":77,"box":{"x":69,"y":158,"width":835,"height":11}},{"id":"4f96d9a1-6ca0-41fe-849f-a8898e19fc74","block_type":"box","text":"for a Fund to buy, sell and hold securities in cer tain foreign markets than in the United States. The increased","page_number":77,"box":{"x":68,"y":173,"width":777,"height":11}},{"id":"a066d158-4a9a-47bd-b4b7-381a07a1ae31","block_type":"box","text":"expense of investing in foreign markets reduces the amount a Fund can earn on its investments and typically results","page_number":77,"box":{"x":69,"y":188,"width":831,"height":12}},{"id":"d1b0439e-3fa0-415c-8ed3-1492cea79d6e","block_type":"box","text":"in a higher operating expense ratio for the Fund as compared to investment companies that invest only in the United","page_number":77,"box":{"x":70,"y":203,"width":828,"height":12}},{"id":"bc3ecbba-f475-4f99-a9a1-1b1f331fa2f9","block_type":"box","text":"States.","page_number":77,"box":{"x":69,"y":219,"width":49,"height":8}},{"id":"d76a2972-ce4e-4e01-b38f-df67e16d68d0","block_type":"box","text":"Publicly Available Information.","page_number":77,"box":{"x":102,"y":241,"width":210,"height":11}},{"id":"97dd275a-8225-4cb5-8019-b64d24ac8c69","block_type":"box","text":"In general, less information is publicly available with respect to foreign issuers","page_number":77,"box":{"x":319,"y":241,"width":558,"height":11}},{"id":"bcfe7933-bf5c-49b4-80ce-655b9610f619","block_type":"box","text":"than is available with respect to U.S. companies. Most foreign companies are also not subject to the uniform","page_number":77,"box":{"x":68,"y":256,"width":779,"height":12}},{"id":"2764b540-9321-43a3-888c-e1ba470abf15","block_type":"box","text":"accounting and financial repor ting requirements applicable to issuers in the United States. While the volume of","page_number":77,"box":{"x":69,"y":271,"width":793,"height":12}},{"id":"1c7cc3fe-8951-4286-aa47-2aa66bfa8790","block_type":"box","text":"transactions effected on foreign stock exchanges has increased in recent years, it remains appreciably below that of","page_number":77,"box":{"x":68,"y":286,"width":834,"height":12}},{"id":"d376284b-c499-47d6-893a-5d82f277f5f8","block_type":"box","text":"the New York Stock Exchange. Accordingly, a Fund’s foreign investments may be less liquid than, and their prices may","page_number":77,"box":{"x":68,"y":302,"width":841,"height":11}},{"id":"d84543a2-3848-4df2-9849-2b7f48d7dc99","block_type":"box","text":"be more volatile than, comparable investments in securities in U.S. companies. In addition, there is generally less","page_number":77,"box":{"x":69,"y":317,"width":813,"height":11}},{"id":"e0382c93-c349-4d99-b3cc-f53383641ec4","block_type":"box","text":"government supervision and regulation of securities exchanges, brokers and issuers in foreign countries than in the","page_number":77,"box":{"x":68,"y":332,"width":827,"height":11}},{"id":"8543ee8a-dd26-46a2-989b-95d6da03e09e","block_type":"box","text":"United States.","page_number":77,"box":{"x":70,"y":347,"width":99,"height":9}},{"id":"fa316404-bba5-46c9-b985-f055be713af4","block_type":"box","text":"Settlement Risk.","page_number":77,"box":{"x":102,"y":370,"width":116,"height":9}},{"id":"3a637ffc-1097-417a-a416-f579e84251e7","block_type":"box","text":"Settlement and clearance procedures in cer tain foreign markets differ significantly from those","page_number":77,"box":{"x":225,"y":370,"width":669,"height":11}},{"id":"951af2dc-b4b0-4c31-9ce1-3923323e4824","block_type":"box","text":"in the United States. Supervisory authorities may also be unable to apply standards which are comparable with those","page_number":77,"box":{"x":70,"y":385,"width":837,"height":11}},{"id":"8ad54a73-97db-4f64-ac31-1b517e603601","block_type":"box","text":"in the United States. Foreign settlement procedures and trade regulations also may involve cer tain risks (such as","page_number":77,"box":{"x":70,"y":400,"width":808,"height":11}},{"id":"fa75b63d-b592-441f-9edd-766dc8ec59dd","block_type":"box","text":"delays in payment for or delivery of securities) not typically generated by the settlement of U.S. investments.","page_number":77,"box":{"x":69,"y":415,"width":772,"height":11}},{"id":"0f963dda-75fd-43a2-a9e3-0e875b40e8cd","block_type":"box","text":"Communications between the United States and emerging market countries may be unreliable, increasing the","page_number":77,"box":{"x":102,"y":438,"width":781,"height":11}},{"id":"693bf133-addd-447a-8f53-62d4ffd1e9cd","block_type":"box","text":"risk of delayed settlements or losses of security cer tificates in markets that still rely on physical settlement.","page_number":77,"box":{"x":69,"y":453,"width":771,"height":11}},{"id":"4c165e26-6a80-45e9-be7b-021bd984e708","block_type":"box","text":"Settlements in cer tain foreign countries at times have not kept pace with the number of securities transactions;","page_number":77,"box":{"x":69,"y":468,"width":797,"height":11}},{"id":"2804984d-cd50-49eb-84dd-76609d41ec07","block_type":"box","text":"these problems may make it difficult for a Fund to carry out transactions. If a Fund cannot settle or is delayed in","page_number":77,"box":{"x":68,"y":483,"width":802,"height":11}},{"id":"139c9451-6ad4-4508-b573-2cdf15e98f45","block_type":"box","text":"settling a purchase of securities, it may miss attractive investment oppor tunities and cer tain of its assets may be","page_number":77,"box":{"x":69,"y":498,"width":812,"height":11}},{"id":"30e72ce2-af17-4345-9cb1-8506263c0941","block_type":"box","text":"uninvested with no return earned thereon for some period. If a Fund cannot settle or is delayed in settling a sale of","page_number":77,"box":{"x":69,"y":513,"width":821,"height":12}},{"id":"4a99392c-5f2b-4afb-b492-7118b2e1f940","block_type":"box","text":"securities, it may lose money if the value of the security then declines or, if it has contracted to sell the security to","page_number":77,"box":{"x":69,"y":528,"width":816,"height":12}},{"id":"5ab20431-006d-409a-81b5-afa3fe24e175","block_type":"box","text":"another par ty, the Fund could be liable to that par ty for any losses incurred.","page_number":77,"box":{"x":69,"y":543,"width":539,"height":12}},{"id":"5fe116dd-1ec6-41ed-b3cb-9ac26404cf92","block_type":"box","text":"Because of uncer tainties in the operation of settlement systems in individual markets, competing claims may","page_number":77,"box":{"x":102,"y":566,"width":781,"height":11}},{"id":"312a105d-1747-4e3d-8b8c-1cc42f7f6c3d","block_type":"box","text":"arise in respect of securities held by or to be transferred to a Fund. Compensation schemes may not exist or may","page_number":77,"box":{"x":69,"y":581,"width":810,"height":11}},{"id":"93860812-1e10-4228-a28c-44a755571972","block_type":"box","text":"otherwise be limited or inadequate to meet the Fund’s claims in case of such event.","page_number":77,"box":{"x":69,"y":596,"width":601,"height":11}},{"id":"1d78eae0-3059-4cc8-a76d-a125fd8bd40b","block_type":"box","text":"Sovereign Debt.","page_number":77,"box":{"x":102,"y":619,"width":111,"height":11}},{"id":"8cbc4d3e-f181-424b-8449-f0ff9f362528","block_type":"box","text":"Investment in sovereign debt can involve a high degree of risk. The governmental entity that","page_number":77,"box":{"x":221,"y":619,"width":653,"height":11}},{"id":"462e516f-6afc-40a9-acdf-2d5dd0217cd6","block_type":"box","text":"controls the repayment of sovereign debt may not be able or willing to repay the principal and/or interest when due in","page_number":77,"box":{"x":69,"y":634,"width":837,"height":12}},{"id":"31aab57d-b9cc-49f5-8bb1-3474aee3b858","block_type":"box","text":"accordance with the terms of such debt. A governmental entity’s willingness or ability to repay principal and interest","page_number":77,"box":{"x":69,"y":649,"width":826,"height":12}},{"id":"88564c85-471b-4b85-8513-107da097cfd5","block_type":"box","text":"due in a timely manner may be affected by, among other factors, its cash flow situation, the extent of its foreign","page_number":77,"box":{"x":69,"y":664,"width":798,"height":12}},{"id":"bc353db4-91e2-4e72-bae7-dd37193004be","block_type":"box","text":"reserves, the availability of sufficient foreign exchange on the date a payment is due, the relative size of the debt","page_number":77,"box":{"x":69,"y":680,"width":809,"height":11}},{"id":"4224fc51-ea9c-4181-904f-b0ce226c5ab0","block_type":"box","text":"service burden to the economy as a whole, the governmental entity’s policy towards the International Monetary Fund","page_number":77,"box":{"x":69,"y":695,"width":832,"height":11}},{"id":"92e927bf-f121-4835-aeef-996561454da6","block_type":"box","text":"and the political constraints to which a governmental entity may be subject. Governmental entities may also be","page_number":77,"box":{"x":69,"y":710,"width":790,"height":11}},{"id":"88ca3401-123a-4804-a4d9-d9bba4cbf86a","block_type":"box","text":"dependent on expected disbursements from foreign governments, multilateral agencies and others abroad to reduce","page_number":77,"box":{"x":69,"y":725,"width":831,"height":11}},{"id":"fedfa18c-af8f-4965-b1de-2140c14b3b6e","block_type":"box","text":"principal and interest arrearages on their debt. The commitment on the par t of these governments, agencies and","page_number":77,"box":{"x":70,"y":740,"width":805,"height":11}},{"id":"e72f1099-adb6-40cf-9e2f-d3ce1b21feec","block_type":"box","text":"others to make such disbursements may be conditioned on the implementation of economic reforms and/or","page_number":77,"box":{"x":69,"y":755,"width":772,"height":11}},{"id":"0a5633e8-b134-4b33-8082-156839ab7c4c","block_type":"box","text":"economic per formance and the timely service of such debtor’s obligations. Failure to implement such reforms,","page_number":77,"box":{"x":69,"y":770,"width":789,"height":12}},{"id":"445094ff-14aa-47b4-b97a-801cd9e7a637","block_type":"box","text":"achieve such levels of economic per formance or repay principal or interest when due may result in the cancellation of","page_number":77,"box":{"x":69,"y":785,"width":839,"height":12}},{"id":"abb5d3a7-1add-4911-86d7-f1b177da63db","block_type":"box","text":"such third par ties’ commitments to lend funds to the governmental entity, which may fur ther impair such debtor’s","page_number":77,"box":{"x":69,"y":801,"width":810,"height":11}},{"id":"0648822d-fc3f-4476-a0b0-cf66581f3f1b","block_type":"box","text":"ability or willingness to timely service its debts. Consequently, governmental entities may default on their sovereign","page_number":77,"box":{"x":69,"y":816,"width":821,"height":11}},{"id":"71e81236-2ed4-413d-b0c5-6c519389f204","block_type":"box","text":"debt.","page_number":77,"box":{"x":69,"y":831,"width":34,"height":9}},{"id":"7c8452b9-809a-4425-bd70-f272dd73db4c","block_type":"box","text":"Holders of sovereign debt may be requested to par ticipate in the rescheduling of such debt and to extend fur ther","page_number":77,"box":{"x":102,"y":853,"width":807,"height":12}},{"id":"59c7a487-0f67-450e-8ccc-ea5ef7877d42","block_type":"box","text":"loans to governmental entities. In the event of a default by a governmental entity, there may be few or no effective","page_number":77,"box":{"x":70,"y":869,"width":814,"height":11}},{"id":"da9a0584-10a3-4f81-9b5a-63ad15a4838a","block_type":"box","text":"legal remedies for collecting on such debt.","page_number":77,"box":{"x":70,"y":884,"width":300,"height":11}},{"id":"d887356d-9f31-437e-b0aa-cc7195b362a7","block_type":"box","text":"II-30","page_number":77,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"6390bb25-13b5-4d81-8863-a999ef160ef6","block_type":"box","text":"NM1026U-6033063-77/246","page_number":77,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"f66bf2c9-a00a-4ae2-970f-fad4f9069253","block_type":"box","text":"Withholding Tax Reclaims Risk","page_number":78,"box":{"x":103,"y":45,"width":215,"height":11}},{"id":"d0259bb3-83cf-4934-919a-39019e6aa77a","block_type":"box","text":". A Fund may file claims to recover foreign withholding taxes on dividend and","page_number":78,"box":{"x":318,"y":45,"width":542,"height":11}},{"id":"47b3631b-a06b-410a-9719-a08d2dd63a25","block_type":"box","text":"interest income (if any) received from issuers in cer tain countries and capital gains on the disposition of stocks or","page_number":78,"box":{"x":70,"y":60,"width":813,"height":11}},{"id":"03e9f76e-e9e7-4bf2-93bc-92ea961298c9","block_type":"box","text":"securities where such withholding tax reclaim is possible. Whether or when a Fund will receive a withholding tax","page_number":78,"box":{"x":69,"y":75,"width":795,"height":11}},{"id":"71062a33-349f-4928-b71a-36f6aa35db92","block_type":"box","text":"refund is within the control of the tax authorities in such countries. Where a Fund expects to recover withholding","page_number":78,"box":{"x":69,"y":90,"width":799,"height":11}},{"id":"c9a1e748-53d0-49e7-9a75-e964aab48601","block_type":"box","text":"taxes, the net asset value of the Fund generally includes accruals for such tax refunds. Each Fund regularly evaluates","page_number":78,"box":{"x":68,"y":105,"width":838,"height":11}},{"id":"5268dd8f-6606-41f7-b7d0-82dcd3c34c4a","block_type":"box","text":"the probability of recovery. If the likelihood of recovery materially decreases, due to, for example, a change in tax","page_number":78,"box":{"x":68,"y":120,"width":807,"height":12}},{"id":"23f5e883-9b00-4cde-84d6-dedc161ccb37","block_type":"box","text":"regulation or approach in the foreign country, accruals in a Fund’s net asset value for such refunds may be written","page_number":78,"box":{"x":69,"y":135,"width":814,"height":12}},{"id":"e8a6e65a-cab5-4f56-a62d-e29ad387b8f5","block_type":"box","text":"down par tially or in full, which will adversely affect the Fund’s net asset value. Shareholders in a Fund at the time an","page_number":78,"box":{"x":69,"y":150,"width":831,"height":12}},{"id":"bf0ae2d8-96fe-4fe5-bf14-6c38bb894395","block_type":"box","text":"accrual is written down will bear the impact of the resulting reduction in net asset value regardless of whether they","page_number":78,"box":{"x":69,"y":166,"width":819,"height":11}},{"id":"3ae967da-8e60-4ae2-8d80-8c286a0682ee","block_type":"box","text":"were shareholders during the accrual period. Conversely, if a Fund receives a tax refund that has not been previously","page_number":78,"box":{"x":68,"y":181,"width":833,"height":11}},{"id":"c904cd5c-bbfe-43bf-ba90-3fbba1fbd44f","block_type":"box","text":"accrued, shareholders in the Fund at the time of the successful recovery will benefit from the resulting increase in","page_number":78,"box":{"x":69,"y":196,"width":814,"height":11}},{"id":"8c0f3b64-e513-4746-91ba-d76e5bd9f147","block_type":"box","text":"the Fund’s net asset value. Shareholders who sold their shares prior to such time will not benefit from such increase","page_number":78,"box":{"x":68,"y":211,"width":835,"height":11}},{"id":"ed5d2719-71d8-4594-b280-404ee9a29cd6","block_type":"box","text":"in the Fund’s net asset value.","page_number":78,"box":{"x":70,"y":226,"width":209,"height":9}},{"id":"0d1e404c-745d-4c39-9668-bb5b7968ecf6","block_type":"box","text":"U.S. Economic Trading Par tners Risk.","page_number":78,"box":{"x":103,"y":249,"width":263,"height":11}},{"id":"92ec1808-0626-44e5-93bb-335a3962ad26","block_type":"box","text":"The United States is a significant, and in some cases the most significant,","page_number":78,"box":{"x":372,"y":249,"width":532,"height":11}},{"id":"c6072322-279b-44bf-bfd2-9b4d8f108ca7","block_type":"box","text":"trading par tner of, or foreign investor in, cer tain countries in which a Fund may invest. As a result, economic","page_number":78,"box":{"x":68,"y":264,"width":773,"height":11}},{"id":"ca38748a-9ab5-4761-917d-bf5f8d6f5065","block_type":"box","text":"conditions of such countries may be par ticularly affected by changes in the U.S. economy. A decrease in U.S. impor ts","page_number":78,"box":{"x":69,"y":279,"width":839,"height":11}},{"id":"3dc58c73-24d5-42b2-8c61-ef3a6ff8cd5a","block_type":"box","text":"or expor ts, new trade and financial regulations or tariffs, changes in the U.S. dollar exchange rate or an economic","page_number":78,"box":{"x":69,"y":294,"width":812,"height":11}},{"id":"96705d5e-bbcd-48d2-8e90-081bcac1a9b5","block_type":"box","text":"slowdown in the United States may have a material adverse effect on a country’s economic conditions and, as a","page_number":78,"box":{"x":69,"y":309,"width":803,"height":11}},{"id":"f9f4b223-155d-4c09-acb7-d7541fdb4296","block_type":"box","text":"result, securities to which the Fund has exposure. Circumstances could arise that could prevent the timely payment","page_number":78,"box":{"x":69,"y":324,"width":824,"height":11}},{"id":"3470d05d-6f7a-4518-9a1e-3264d5bf3a45","block_type":"box","text":"of interest or principal on U.S. Government debt, such as reaching the legislative “debt ceiling.” Such non-payment","page_number":78,"box":{"x":69,"y":339,"width":819,"height":12}},{"id":"714cca99-b91e-4feb-9736-ed6af94eecee","block_type":"box","text":"would result in substantial negative consequences for the U.S. economy and the global financial system.","page_number":78,"box":{"x":68,"y":355,"width":746,"height":11}},{"id":"12d6c51d-822a-452b-8898-91151963d3fd","block_type":"box","text":"There are strained relations between the United States and a number of foreign countries, including traditional","page_number":78,"box":{"x":101,"y":377,"width":787,"height":12}},{"id":"1a3b05a6-0145-4976-b41c-a883967c827e","block_type":"box","text":"allies, such as cer tain European countries, and historical adversaries, such as Nor th Korea, Iran, China and Russia.","page_number":78,"box":{"x":69,"y":392,"width":827,"height":11}},{"id":"3781d9df-cf0f-411f-8448-46428ae27687","block_type":"box","text":"If these relations were to worsen, it could adversely affect U.S. issuers as well as non-U.S. issuers that rely on the","page_number":78,"box":{"x":70,"y":407,"width":817,"height":12}},{"id":"a66b70c8-8adc-4eb2-b951-6926a6ed249e","block_type":"box","text":"United States for trade. The United States has also experienced increased internal unrest and discord. If these","page_number":78,"box":{"x":70,"y":423,"width":791,"height":11}},{"id":"bbedf85c-aeda-4447-98a5-c1a58741f04f","block_type":"box","text":"trends were to continue, it may have an adverse impact on the U.S. economy and many of the issuers in which a","page_number":78,"box":{"x":68,"y":438,"width":803,"height":11}},{"id":"cf3d167b-77ef-45f7-8544-32ebb8031bf3","block_type":"box","text":"Fund may invest.","page_number":78,"box":{"x":70,"y":453,"width":117,"height":11}},{"id":"5c9ec88c-e8c5-49e4-8c7d-4838e115f785","block_type":"box","text":"Funding Agreements.","page_number":78,"box":{"x":102,"y":476,"width":154,"height":11}},{"id":"1dd986c7-a4d8-4e11-a9f3-02978225da29","block_type":"box","text":"Cer tain Funds may invest in Guaranteed Investment Contracts and similar funding","page_number":78,"box":{"x":262,"y":475,"width":584,"height":12}},{"id":"7361e91e-4c07-4c9f-8f99-07de9a332b60","block_type":"box","text":"agreements. In connection with these investments, a Fund makes cash contributions to a deposit fund of an","page_number":78,"box":{"x":69,"y":491,"width":773,"height":11}},{"id":"0e1bd020-5644-48d3-81d6-4927adb3c262","block_type":"box","text":"insurance company’s general account. The insurance company then credits to the Fund on a monthly basis","page_number":78,"box":{"x":70,"y":506,"width":761,"height":11}},{"id":"664f45fe-fa10-497c-a535-7b77c4e2ad66","block_type":"box","text":"guaranteed interest, which is based on an index. The funding agreements provide that this guaranteed interest will","page_number":78,"box":{"x":68,"y":521,"width":817,"height":11}},{"id":"84e347ba-5923-4b4d-a1f4-54b7a59686bf","block_type":"box","text":"not be less than a cer tain minimum rate. The purchase price paid for a funding agreement becomes par t of the","page_number":78,"box":{"x":69,"y":536,"width":794,"height":11}},{"id":"35f3285c-e226-482f-809e-85451d5063ab","block_type":"box","text":"general assets of the insurance company, and the contract is paid from the general assets of the insurance company.","page_number":78,"box":{"x":68,"y":551,"width":839,"height":11}},{"id":"644ff2b1-ebdc-41e5-b40f-8772ccaaf0e9","block_type":"box","text":"Generally, funding agreements are not assignable or transferable without the permission of the issuing insurance","page_number":78,"box":{"x":69,"y":566,"width":806,"height":11}},{"id":"cea0d07c-795e-4ddc-ab7c-57cf18db46e1","block_type":"box","text":"companies, and an active secondary market in some funding agreements does not currently exist.","page_number":78,"box":{"x":69,"y":581,"width":700,"height":12}},{"id":"1d9f9a89-fbd9-45f1-8ce8-b1b54f33961f","block_type":"box","text":"Guarantees.","page_number":78,"box":{"x":102,"y":604,"width":87,"height":9}},{"id":"33ed2ada-0914-48dc-bc7b-c3986d224413","block_type":"box","text":"A Fund may purchase securities which contain guarantees issued by an entity separate from the","page_number":78,"box":{"x":194,"y":604,"width":685,"height":11}},{"id":"bff01d9b-49f6-4a84-b8b6-3ffa3edc37d6","block_type":"box","text":"issuer of the security. Generally, the guarantor of a security (often an affiliate of the issuer) will fulfill an issuer’s","page_number":78,"box":{"x":70,"y":619,"width":797,"height":11}},{"id":"262ce6a2-bc9f-45b2-8de3-b7755f132be9","block_type":"box","text":"payment obligations under a security if the issuer is unable to do so.","page_number":78,"box":{"x":70,"y":634,"width":488,"height":12}},{"id":"964418d7-9c74-47bf-9681-a1635ca38ac0","block_type":"box","text":"Illiquid Investments.","page_number":78,"box":{"x":102,"y":657,"width":146,"height":11}},{"id":"9c79adc7-18a2-4acd-abcf-301f25b27ae5","block_type":"box","text":"Each Fund may not acquire any illiquid investment if, immediately after the acquisition, a","page_number":78,"box":{"x":255,"y":657,"width":630,"height":11}},{"id":"e8909d6b-59c2-4764-bc89-dff13209fcbd","block_type":"box","text":"Fund would have invested more than 15% of its net assets in illiquid investments. An illiquid investment is any","page_number":78,"box":{"x":70,"y":672,"width":787,"height":11}},{"id":"f1e1df34-3f19-4b9a-b476-7b9c8e702a24","block_type":"box","text":"investment that a Fund reasonably expects cannot be sold or disposed of in current market conditions in seven","page_number":78,"box":{"x":70,"y":687,"width":792,"height":11}},{"id":"88b072f6-20cb-4c50-a90c-571e02ec08f5","block_type":"box","text":"calendar days or less without the sale or disposition significantly changing the market value of the investment. Liquid","page_number":78,"box":{"x":69,"y":702,"width":834,"height":12}},{"id":"53d3a480-9cdf-4591-ac91-298e767f59e6","block_type":"box","text":"investments may become illiquid after purchase by a Fund, par ticularly during periods of market turmoil. There can be","page_number":78,"box":{"x":70,"y":717,"width":838,"height":12}},{"id":"59108986-c2c4-4cb5-855e-f365013d9bcc","block_type":"box","text":"no assurance that a security or instrument that is deemed to be liquid when purchased will continue to be liquid for","page_number":78,"box":{"x":69,"y":732,"width":824,"height":12}},{"id":"f711c882-a1f7-4b6e-a6e8-9bce319a6803","block_type":"box","text":"as long as it is held by a Fund, and any security or instrument held by the Fund may be deemed an illiquid investment","page_number":78,"box":{"x":69,"y":748,"width":838,"height":11}},{"id":"bc420175-fee9-41dc-bac0-14dcee7d20d2","block_type":"box","text":"pursuant to the Fund’s liquidity risk management program. A Fund’s illiquid investments may reduce the returns of","page_number":78,"box":{"x":70,"y":763,"width":816,"height":11}},{"id":"ce42ff7a-79b9-44d5-bb18-c249b7c7ed14","block_type":"box","text":"the Fund because it may be difficult to sell the illiquid investments at an advantageous time or price. In addition, if a","page_number":78,"box":{"x":68,"y":778,"width":832,"height":11}},{"id":"63517595-6e1a-4809-a036-4a8c48d43328","block_type":"box","text":"Fund is limited in its ability to dispose of illiquid investments during periods when shareholders are redeeming or","page_number":78,"box":{"x":70,"y":793,"width":803,"height":11}},{"id":"0978f191-5355-4218-865a-a75ef5d840ed","block_type":"box","text":"selling their shares, or the Fund’s net assets otherwise shrink, the Fund will need to dispose of liquid securities to","page_number":78,"box":{"x":69,"y":808,"width":817,"height":11}},{"id":"fba2d6ce-70f5-4d4c-9b9b-1d23ce52eb71","block_type":"box","text":"meet redemption requests and illiquid securities will become a larger por tion of the Fund’s holdings. If illiquid","page_number":78,"box":{"x":69,"y":823,"width":781,"height":12}},{"id":"595c4ef8-1b22-47e2-99f6-62efc48de9e4","block_type":"box","text":"investments exceed 15% of a Fund’s net assets, the Liquidity Rule (as defined below) and the Liquidity Program (as","page_number":78,"box":{"x":70,"y":838,"width":822,"height":12}},{"id":"93fdd9ce-98bb-4e2b-9e7a-bc584906d5bd","block_type":"box","text":"defined below) will require that cer tain remedial actions be taken. Illiquid investments may trade at a discount from","page_number":78,"box":{"x":69,"y":853,"width":822,"height":12}},{"id":"6ad3fda5-0c86-471d-8625-68452f1d0225","block_type":"box","text":"comparable liquid investments. Investment of a Fund’s assets in illiquid investments may restrict the ability of the","page_number":78,"box":{"x":69,"y":869,"width":813,"height":11}},{"id":"d8028a2d-6f27-4eee-bc33-2879bd1b81d3","block_type":"box","text":"Fund to dispose of its investments in a timely fashion and for a fair price as well as its ability to take advantage of","page_number":78,"box":{"x":70,"y":884,"width":814,"height":11}},{"id":"d6b48810-0c31-457a-9783-54a4ff80b15f","block_type":"box","text":"market oppor tunities. The risks associated with illiquidity will be par ticularly acute where a Fund’s operations require","page_number":78,"box":{"x":69,"y":899,"width":833,"height":11}},{"id":"bde5e8ac-a20b-4d63-9c11-efa8c6075387","block_type":"box","text":"II-31","page_number":78,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"2e3ea871-bbee-4fc6-b463-794667397563","block_type":"box","text":"NM1026U-6033063-78/246","page_number":78,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"dedab2b8-1c3c-4a8c-9e41-36cb02d4b01e","block_type":"box","text":"cash, such as when the Fund redeems shares or pays dividends, and could result in the Fund borrowing to meet","page_number":79,"box":{"x":69,"y":45,"width":801,"height":11}},{"id":"719e508a-721c-457e-a036-349f99197881","block_type":"box","text":"shor t-term cash requirements or incurring capital losses on the sale of illiquid investments.","page_number":79,"box":{"x":69,"y":60,"width":651,"height":11}},{"id":"c93661e7-a04f-49c7-8dc3-c25372d2208a","block_type":"box","text":"Index Funds.","page_number":79,"box":{"x":102,"y":83,"width":91,"height":8}},{"id":"5d5acd2d-ddba-4ca1-b0a2-d5990e730f89","block_type":"box","text":"Cash Flows; Expenses.","page_number":79,"box":{"x":102,"y":105,"width":162,"height":11}},{"id":"5e7536b9-b6b1-4a03-993c-309b4df89afd","block_type":"box","text":"The ability of each Fund to satisfy its investment objective depends to some extent on","page_number":79,"box":{"x":270,"y":105,"width":613,"height":11}},{"id":"88388798-477a-41aa-a407-1137366a2d3f","block_type":"box","text":"the Manager’s ability to manage cash flow (primarily from purchases and redemptions and distributions from the","page_number":79,"box":{"x":68,"y":120,"width":803,"height":12}},{"id":"59d893a3-5f5d-4596-bd2f-1d6bb23d5af8","block_type":"box","text":"Fund’s investments). The Manager will make investment changes to a Fund’s por tfolio to accommodate cash flow","page_number":79,"box":{"x":70,"y":135,"width":810,"height":12}},{"id":"0f081c89-e9fd-4e20-8cf5-42fb162e2b11","block_type":"box","text":"while continuing to seek to replicate the total return of the Fund’s target index. Investors should also be aware that","page_number":79,"box":{"x":68,"y":150,"width":823,"height":12}},{"id":"9ed59a5e-9f48-4181-bef2-64d028cd8505","block_type":"box","text":"the investment per formance of each index is a hypothetical number which does not take into account brokerage","page_number":79,"box":{"x":68,"y":166,"width":799,"height":11}},{"id":"eb211061-fc39-4a9b-8195-3dc1f7e47347","block_type":"box","text":"commissions and other transaction costs, custody and other costs of investing, and any incremental operating costs","page_number":79,"box":{"x":69,"y":181,"width":831,"height":11}},{"id":"a6e88d58-e832-45b9-a5fd-787f8c625d74","block_type":"box","text":"(","page_number":79,"box":{"x":69,"y":196,"width":3,"height":11}},{"id":"cbbfc147-c42f-4fdd-a4d4-b16786f185bd","block_type":"box","text":"e.g.","page_number":79,"box":{"x":74,"y":197,"width":25,"height":10}},{"id":"80cc0693-97f1-45bd-b7ed-aacd178a6e58","block_type":"box","text":", transfer agency and accounting costs) that will be borne by the Funds. Finally, since each Fund seeks to","page_number":79,"box":{"x":101,"y":196,"width":749,"height":11}},{"id":"d4cb8bdc-813f-4572-996d-2be3dde393c6","block_type":"box","text":"replicate the total return of its target index, the Manager generally will not attempt to judge the merits of any","page_number":79,"box":{"x":69,"y":211,"width":774,"height":11}},{"id":"16817612-2405-42e0-b249-45ab7b66a009","block_type":"box","text":"par ticular security as an investment.","page_number":79,"box":{"x":70,"y":226,"width":258,"height":11}},{"id":"ba73b44c-e20e-4b93-be64-b76cc477de3a","block_type":"box","text":"Tracking Error Risk","page_number":79,"box":{"x":103,"y":249,"width":132,"height":11}},{"id":"4c85c8a7-3812-426d-8953-a91fbbf4c66b","block_type":"box","text":". A Fund may be subject to tracking error, which is the divergence of the Fund’s per formance","page_number":79,"box":{"x":236,"y":249,"width":658,"height":11}},{"id":"6554539a-21a5-49aa-ba71-8a8c78e7c719","block_type":"box","text":"from that of the Underlying Index. Tracking error may occur because of differences between the securities and other","page_number":79,"box":{"x":68,"y":264,"width":827,"height":11}},{"id":"c6259e20-3588-4796-9e91-cdada3717bb9","block_type":"box","text":"instruments held in the Fund’s por tfolio and those included in the Underlying Index, pricing differences (including, as","page_number":79,"box":{"x":70,"y":279,"width":830,"height":11}},{"id":"2b977644-cec0-4128-854b-c724792e2cec","block_type":"box","text":"applicable, differences between a security’s price at the local market close and the Fund’s valuation of a security at","page_number":79,"box":{"x":69,"y":294,"width":827,"height":11}},{"id":"28f230c1-4236-4653-baeb-7fd2105170e4","block_type":"box","text":"the time of calculation of the Fund’s net asset value), differences in transaction costs incurred by the Fund, the","page_number":79,"box":{"x":68,"y":309,"width":797,"height":11}},{"id":"2c6523d9-f4b5-4746-8a0a-481f81a1ad97","block_type":"box","text":"Fund’s holding of uninvested cash, differences in timing of the accrual of or the valuation of dividends or other","page_number":79,"box":{"x":70,"y":324,"width":787,"height":12}},{"id":"3bfc723c-6608-4526-b9e7-bb1f6bf15ed8","block_type":"box","text":"distributions, interest, the requirements to maintain pass-through tax treatment, por tfolio transactions carried out to","page_number":79,"box":{"x":69,"y":339,"width":830,"height":12}},{"id":"b0bb184b-931e-4408-a67b-72dae9745fe8","block_type":"box","text":"minimize the distribution of capital gains to shareholders, changes to the Underlying Index or the costs to the Fund of","page_number":79,"box":{"x":69,"y":355,"width":838,"height":11}},{"id":"65e8837e-8d7e-4720-bb22-ba13898d13de","block_type":"box","text":"complying with various new or existing regulatory requirements. These risks may be heightened during times of","page_number":79,"box":{"x":69,"y":370,"width":791,"height":11}},{"id":"44ae1de3-b1ec-4917-b17f-194dc7ad7922","block_type":"box","text":"increased market volatility or other unusual market conditions. In addition, tracking error may result because the","page_number":79,"box":{"x":70,"y":385,"width":801,"height":11}},{"id":"0b525be9-3274-4b5f-9906-d6ba4e0b9a05","block_type":"box","text":"Fund incurs fees and expenses, while the Underlying Index does not.","page_number":79,"box":{"x":70,"y":400,"width":487,"height":11}},{"id":"66186d09-2c47-4ee3-b17d-26794df04097","block_type":"box","text":"When an issuer is introduced by an index provider into an index tracked by a Fund, the Manager may conduct an","page_number":79,"box":{"x":101,"y":423,"width":799,"height":11}},{"id":"74dcd3e3-49e0-4d31-966c-3bfe26ad8ae2","block_type":"box","text":"analysis on such issuer’s securities to identify and screen for outlier high risk behavior (such as rapid or unusual","page_number":79,"box":{"x":69,"y":438,"width":803,"height":11}},{"id":"fcddd0ae-257c-4b71-aa50-a2fa37eff539","block_type":"box","text":"price growth that does not appear to be suppor ted by publicly available information on the business and assets of","page_number":79,"box":{"x":70,"y":453,"width":814,"height":11}},{"id":"2c633669-e764-4531-b875-75a6ee182cde","block_type":"box","text":"the issuer, unusual or significant shor t interest or lending activity, negative sentiment, suspended trading or incorrect","page_number":79,"box":{"x":68,"y":468,"width":838,"height":11}},{"id":"defbb1f4-b415-4633-b0b7-aa6fe8c33b4a","block_type":"box","text":"free-float calculations, which could be indicators of possible irregularities, miscalculations or even fraud). If it","page_number":79,"box":{"x":68,"y":483,"width":778,"height":11}},{"id":"147fb2e8-ad88-4152-bf1e-83e74c1f37f2","block_type":"box","text":"identifies such behavior, the Manager may, where appropriate, aler t the index provider as to the alleged issue. The","page_number":79,"box":{"x":70,"y":498,"width":816,"height":11}},{"id":"778ffdd4-77b9-4e07-815a-e61dec4b0554","block_type":"box","text":"index provider has sole discretion for the determination as to whether to continue to include the issuer’s securities in","page_number":79,"box":{"x":70,"y":513,"width":836,"height":11}},{"id":"ad8afd5c-3376-4b19-93ec-ac693bbc25d7","block_type":"box","text":"the rebalancing of its index. If the securities continue to be included in the index, the Manager may underweight or","page_number":79,"box":{"x":68,"y":528,"width":819,"height":12}},{"id":"c3a30aec-ebf7-47bb-ac51-0731080c7c6f","block_type":"box","text":"exclude such securities from a Fund’s por tfolio and, if it does so, such Fund will be subject to increased tracking","page_number":79,"box":{"x":69,"y":543,"width":804,"height":12}},{"id":"919f36bb-961c-4513-aeb1-5716b144761c","block_type":"box","text":"error due to the divergence in the securities included in its por tfolio from its underlying index. The application of the","page_number":79,"box":{"x":69,"y":559,"width":825,"height":11}},{"id":"9e68eb9e-4c32-4fc5-bcc0-0216ef73b52b","block_type":"box","text":"abovementioned analysis and screening to a Fund and its Underlying Index is in the sole discretion of the Manager","page_number":79,"box":{"x":69,"y":574,"width":818,"height":11}},{"id":"e70fbd7f-f0f0-4cae-b6ac-686a3b21be31","block_type":"box","text":"and its affiliates (without any guarantees). The analysis and screening may not exclude any or all high risk securities","page_number":79,"box":{"x":69,"y":589,"width":829,"height":11}},{"id":"c4e386f3-bcb7-4539-a6ba-8e33e88fd0ad","block_type":"box","text":"from an Underlying Index or a Fund’s por tfolio, and the inclusion of such securities will result in an adverse impact to","page_number":79,"box":{"x":68,"y":604,"width":835,"height":11}},{"id":"4c6c43e5-2195-4bff-872f-0e3684c74a69","block_type":"box","text":"the Fund’s net asset value if one or more such securities declines in value.","page_number":79,"box":{"x":68,"y":619,"width":536,"height":9}},{"id":"c836a857-889c-484a-ba86-fc6183c24aee","block_type":"box","text":"S&P 500®","page_number":79,"box":{"x":102,"y":642,"width":64,"height":9}},{"id":"cc5461ab-be44-47b0-9b27-77938f1b4555","block_type":"box","text":"0®","page_number":79,"box":{"x":166,"y":642,"width":6,"height":5}},{"id":"a63ba5cb-6ebd-481a-a684-3c85ecfc5391","block_type":"box","text":"Index (“S&P 500”).","page_number":79,"box":{"x":178,"y":642,"width":134,"height":11}},{"id":"a207926d-1cbe-473f-a93e-320a86b0237d","block_type":"box","text":"“Standard & Poor’s","page_number":79,"box":{"x":320,"y":642,"width":136,"height":9}},{"id":"81a226a1-cc9a-40b1-9c20-a66c119963c7","block_type":"box","text":"®","page_number":79,"box":{"x":457,"y":642,"width":6,"height":5}},{"id":"a7a62d7c-bbac-4bd8-86fa-838c01e3a904","block_type":"box","text":",” “S&P","page_number":79,"box":{"x":465,"y":642,"width":53,"height":10}},{"id":"fee26574-248e-4bde-afc7-3ff6e6d4128c","block_type":"box","text":"®","page_number":79,"box":{"x":518,"y":642,"width":6,"height":5}},{"id":"6bd4094a-29d2-4478-9a3d-bc74f2267d3b","block_type":"box","text":",” “S&P 500","page_number":79,"box":{"x":526,"y":642,"width":87,"height":10}},{"id":"06066ee2-7d80-4a15-8fed-8445a8696d49","block_type":"box","text":"®","page_number":79,"box":{"x":614,"y":642,"width":6,"height":5}},{"id":"680a1edb-0e07-4f99-aa77-7b1423750ab4","block_type":"box","text":",” “Standard & Poor’s 500,” and “500”","page_number":79,"box":{"x":621,"y":642,"width":280,"height":10}},{"id":"abbb2801-667c-459c-925b-9bd4a39bdb60","block_type":"box","text":"are trademarks of S&P Global Inc. and have been licensed for use by cer tain mutual funds sponsored and advised by","page_number":79,"box":{"x":69,"y":657,"width":837,"height":11}},{"id":"92981ea6-57d6-4050-bd2c-5c9a128f1242","block_type":"box","text":"BlackRock or its affiliates (“BlackRock Funds”). No Fund is sponsored, endorsed, sold or promoted by S&P, a division","page_number":79,"box":{"x":70,"y":672,"width":836,"height":11}},{"id":"770d9b5f-b6a5-4479-8f12-204fa6ea5dbf","block_type":"box","text":"of S&P Global Inc. S&P makes no representation regarding the advisability of investing in any Fund. S&P makes no","page_number":79,"box":{"x":69,"y":687,"width":818,"height":11}},{"id":"abb9edb4-0a2e-4795-9304-22e077ffb20e","block_type":"box","text":"representation or warranty, express or implied, to the owners of shares of a Fund or any member of the public","page_number":79,"box":{"x":69,"y":702,"width":783,"height":11}},{"id":"a268517b-e79a-4264-9225-cb9cacf50180","block_type":"box","text":"regarding the advisability of investing in securities generally or in a Fund par ticularly or the ability of the S&P 500 to","page_number":79,"box":{"x":69,"y":717,"width":823,"height":12}},{"id":"7563075c-bf19-42ab-b9d5-56d163112f5e","block_type":"box","text":"track general stock market per formance. S&P’s only relationship to cer tain Funds is the licensing of cer tain","page_number":79,"box":{"x":68,"y":732,"width":769,"height":12}},{"id":"c3d4e156-f02c-4c2f-ac74-8cc41f0bb27f","block_type":"box","text":"trademarks and trade names of S&P and of the S&P 500 which is determined, composed and calculated by S&P","page_number":79,"box":{"x":68,"y":748,"width":804,"height":11}},{"id":"b9fdb314-6be7-46c9-a103-6b9efc8713fb","block_type":"box","text":"without regard to the Funds. S&P has no obligation to take the needs of a Fund or the owners of shares of a Fund","page_number":79,"box":{"x":68,"y":763,"width":811,"height":11}},{"id":"d50fdd0d-313a-46d3-a9bf-5c7feec084e1","block_type":"box","text":"into consideration in determining, composing or calculating the S&P 500. 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A Fund may also invest in so-called “inverse floating obligations”","page_number":81,"box":{"x":69,"y":339,"width":837,"height":12}},{"id":"11bb3039-b852-42e5-b702-dbd896a9ac1f","block_type":"box","text":"or “residual interest bonds” on which the interest rates vary inversely with a floating rate (which may be reset","page_number":81,"box":{"x":69,"y":355,"width":781,"height":11}},{"id":"744e2d14-6f71-457a-9a04-e798edee7d91","block_type":"box","text":"periodically by a Dutch auction, a remarketing agent, or by reference to a shor t-term tax-exempt interest rate index). A","page_number":81,"box":{"x":70,"y":370,"width":838,"height":11}},{"id":"816d1083-d98b-4d54-aadd-15dd33ef59f6","block_type":"box","text":"Fund may purchase synthetically-created inverse floating rate bonds evidenced by custodial or trust receipts.","page_number":81,"box":{"x":70,"y":385,"width":771,"height":11}},{"id":"e570acae-176d-4554-a7ef-a7372aab965b","block_type":"box","text":"Generally, income on inverse floating rate bonds will decrease when interest rates increase, and will increase when","page_number":81,"box":{"x":69,"y":400,"width":820,"height":11}},{"id":"2aa01b00-9669-45ef-a300-6f00672e5a36","block_type":"box","text":"interest rates decrease. Such securities have the effect of providing a degree of investment leverage, since they may","page_number":81,"box":{"x":70,"y":415,"width":835,"height":11}},{"id":"9501eb11-9ea1-4f7a-abc0-83452850cb0e","block_type":"box","text":"increase or decrease in value in response to changes, as an illustration, in market interest rates at a rate that is a","page_number":81,"box":{"x":70,"y":430,"width":817,"height":11}},{"id":"eeb64e1e-062e-445b-97f0-e7dcb9869978","block_type":"box","text":"multiple of the rate at which fixed-rate securities increase or decrease in response to such changes. As a result, the","page_number":81,"box":{"x":69,"y":445,"width":829,"height":12}},{"id":"ae4cc9fe-c831-44f5-897b-ca01b5956480","block_type":"box","text":"market values of such securities will generally be more volatile than the market values of fixed-rate securities. To","page_number":81,"box":{"x":69,"y":460,"width":804,"height":12}},{"id":"aafc18dc-9f95-4960-b60f-ae79063f5ea5","block_type":"box","text":"seek to limit the volatility of these securities, a Fund may purchase inverse floating obligations that have shor ter-term","page_number":81,"box":{"x":69,"y":475,"width":838,"height":12}},{"id":"ac67dacf-dccf-4c5b-b1bf-a82df9e80cbb","block_type":"box","text":"maturities or that contain limitations on the extent to which the interest rate may vary. Cer tain investments in such","page_number":81,"box":{"x":69,"y":491,"width":819,"height":11}},{"id":"e0650d38-09ab-495f-9835-0a7aa6611f5e","block_type":"box","text":"obligations may be illiquid. The Manager believes that indexed and inverse floating obligations represent flexible","page_number":81,"box":{"x":69,"y":506,"width":798,"height":11}},{"id":"9000803b-8680-44b4-a913-71e4862395ed","block_type":"box","text":"por tfolio management instruments for a Fund that allow the Fund to seek potential investment rewards, hedge other","page_number":81,"box":{"x":70,"y":521,"width":829,"height":11}},{"id":"e219e1c0-8ce9-473a-8e74-63a7a5b1e82b","block_type":"box","text":"por tfolio positions or vary the degree of investment leverage relatively efficiently under different market conditions. A","page_number":81,"box":{"x":70,"y":536,"width":834,"height":11}},{"id":"e18583e4-21c5-4b8a-8f20-e6b4888cc484","block_type":"box","text":"Fund may invest in indexed and inverse securities for hedging purposes or to seek to increase returns. When used for","page_number":81,"box":{"x":70,"y":551,"width":839,"height":11}},{"id":"32aca8e2-1793-4c88-b7d1-f30de31faf0f","block_type":"box","text":"hedging purposes, indexed and inverse securities involve correlation risk. Fur thermore, where such a security","page_number":81,"box":{"x":69,"y":566,"width":781,"height":11}},{"id":"c7c200d6-9fc9-4557-a4bd-60ce7c9ef330","block_type":"box","text":"includes a contingent liability, in the event of an adverse movement in the underlying index or interest rate, a Fund","page_number":81,"box":{"x":70,"y":581,"width":812,"height":12}},{"id":"32b17843-bafe-4f38-8aeb-5639fcf26fae","block_type":"box","text":"may be required to pay substantial additional margin to maintain the position.","page_number":81,"box":{"x":69,"y":597,"width":553,"height":11}},{"id":"472a8a76-c02d-49e1-b469-7cee86640f2d","block_type":"box","text":"The Funds may invest up to 10% of their total assets in leveraged inverse floating rate debt instruments","page_number":81,"box":{"x":101,"y":619,"width":741,"height":11}},{"id":"cc96cee0-17b1-4d68-8442-d53985e183dc","block_type":"box","text":"(“inverse floaters”). Inverse floaters are securities the potential of which is inversely related to changes in interest","page_number":81,"box":{"x":69,"y":634,"width":815,"height":12}},{"id":"c5ae27b0-e488-4268-baae-4d5c99dc8bff","block_type":"box","text":"rates. In general, the return on inverse floaters will decrease when shor t-term interest rates increase and increase","page_number":81,"box":{"x":69,"y":649,"width":817,"height":12}},{"id":"efb24bb7-4466-4262-bc81-c342a8ae9ffe","block_type":"box","text":"when shor t-term rates decrease. Municipal tender option bonds, both taxable and tax-exempt, which may include","page_number":81,"box":{"x":68,"y":665,"width":805,"height":11}},{"id":"a6bea2e4-2c4d-42f2-bdce-0c640e8ffb44","block_type":"box","text":"inverse floating rate debt instruments, (including residual interests thereon) are excluded from this 10% limitation.","page_number":81,"box":{"x":70,"y":680,"width":813,"height":11}},{"id":"6cad053b-b41b-4994-a75f-9086a73c1375","block_type":"box","text":"Inflation Risk.","page_number":81,"box":{"x":102,"y":702,"width":100,"height":9}},{"id":"454167d5-aa47-47f9-9bea-50c2e863b1ac","block_type":"box","text":"Like all funds, the Funds are subject to inflation risk. Inflation risk is the risk that the present","page_number":81,"box":{"x":209,"y":702,"width":663,"height":11}},{"id":"7182ce85-4a06-4d35-af05-7f59648277bc","block_type":"box","text":"value of assets or income from investments will be less in the future as inflation decreases the value of money. As","page_number":81,"box":{"x":68,"y":717,"width":820,"height":12}},{"id":"b772023c-48ce-4289-8dd3-8f49f5784835","block_type":"box","text":"inflation increases, the present value of a Fund’s assets can decline as can the value of a Fund’s distributions.","page_number":81,"box":{"x":70,"y":732,"width":792,"height":11}},{"id":"cd973448-484c-429b-9e29-e74e5ebd3b43","block_type":"box","text":"Inflation rates may change frequently and significantly due to a number of potential factors, including, among others,","page_number":81,"box":{"x":70,"y":748,"width":829,"height":11}},{"id":"2d1b0b55-9433-4834-b219-4eb3bb078cb1","block_type":"box","text":"unexpected economic shifts or changes in fiscal or monetary policies.","page_number":81,"box":{"x":69,"y":763,"width":497,"height":11}},{"id":"b9ca6d87-3769-40d9-87ba-d21f1631d60e","block_type":"box","text":"Initial Public Offering (“IPO”) Risk.","page_number":81,"box":{"x":102,"y":785,"width":253,"height":12}},{"id":"e6a7f8e6-9f14-4466-a8f2-3fa1392b21ed","block_type":"box","text":"The volume of IPOs and the levels at which the newly issued stocks trade in","page_number":81,"box":{"x":361,"y":785,"width":540,"height":12}},{"id":"68df02aa-e839-4066-8b1a-3414a3b8c4ee","block_type":"box","text":"the secondary market are affected by the per formance of the stock market overall. If IPOs are brought to the market,","page_number":81,"box":{"x":68,"y":801,"width":836,"height":11}},{"id":"0acbcb8f-66e1-4aa4-94bd-bb04b0842dfe","block_type":"box","text":"availability may be limited and a Fund may not be able to buy any shares at the offering price, or if it is able to buy","page_number":81,"box":{"x":69,"y":816,"width":815,"height":11}},{"id":"0ced3fc3-f47e-4d08-a0ef-f63d6764b08a","block_type":"box","text":"shares, it may not be able to buy as many shares at the offering price as it would like. In addition, the prices of","page_number":81,"box":{"x":69,"y":831,"width":795,"height":11}},{"id":"98a05279-a53b-423e-b20f-03a822ed5984","block_type":"box","text":"securities involved in IPOs are often subject to greater and more unpredictable price changes than more established","page_number":81,"box":{"x":69,"y":846,"width":829,"height":11}},{"id":"b38271f7-56fb-4d6f-ad60-a037b89776c5","block_type":"box","text":"stocks. IPOs have the potential to produce substantial gains. A Fund may hold shares from an IPO for only a shor t","page_number":81,"box":{"x":69,"y":861,"width":814,"height":11}},{"id":"a69eaa18-aa0f-4d54-9f29-d3a810ef8faf","block_type":"box","text":"period of time given possible price volatility. This may result in increased por tfolio turnover and expenses, such as","page_number":81,"box":{"x":70,"y":876,"width":813,"height":11}},{"id":"a6c013cf-834f-4c94-ac3e-36f3104bb8a8","block_type":"box","text":"commissions and transaction costs, and potentially result in taxable gains that the Fund will subsequently distribute","page_number":81,"box":{"x":69,"y":891,"width":828,"height":12}},{"id":"159cdbc5-f639-405d-ba88-603877970793","block_type":"box","text":"to shareholders. There is no assurance that any Fund will have access to profitable IPOs and therefore investors","page_number":81,"box":{"x":68,"y":906,"width":802,"height":12}},{"id":"ab0e5798-b1c4-48f1-85ba-f7a0cd626e17","block_type":"box","text":"II-34","page_number":81,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"3914bfc5-d945-4156-9a0e-856b942ed249","block_type":"box","text":"NM1026U-6033063-81/246","page_number":81,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"230ecf49-fc1a-49eb-810a-882d83ad9bb5","block_type":"box","text":"should not rely on any past gains from IPOs as an indication of future per formance. The investment per formance of a","page_number":82,"box":{"x":69,"y":45,"width":837,"height":11}},{"id":"6f748632-c81a-4528-a956-f0853296f580","block_type":"box","text":"Fund during periods when it is unable to invest significantly or at all in IPOs may be lower than during periods when it","page_number":82,"box":{"x":70,"y":60,"width":832,"height":11}},{"id":"66d7a0b1-8164-4efe-ab73-2c603a930dc2","block_type":"box","text":"is able to do so. In addition, as a Fund increases in size, the impact of IPOs on its per formance will generally","page_number":82,"box":{"x":70,"y":75,"width":777,"height":11}},{"id":"63f35d62-5d5c-4cfe-a3ba-6f5a1d4f242a","block_type":"box","text":"decrease. Securities issued in IPOs are subject to many of the same risks as investing in companies with smaller","page_number":82,"box":{"x":69,"y":90,"width":810,"height":11}},{"id":"d4caed72-05e5-4b6d-8220-bb2af1fd831c","block_type":"box","text":"market capitalizations. Securities issued in IPOs have no trading history, and information about the companies may","page_number":82,"box":{"x":69,"y":105,"width":823,"height":11}},{"id":"d2cf870e-44bc-4e98-83c7-704e4f26e912","block_type":"box","text":"be available for very limited periods.","page_number":82,"box":{"x":69,"y":120,"width":257,"height":11}},{"id":"a12bcf7a-b4d8-43c4-9e29-fa8a0bc601d8","block_type":"box","text":"Investment in Emerging Markets.","page_number":82,"box":{"x":102,"y":143,"width":242,"height":11}},{"id":"8e820578-6faf-42a7-bfba-d57421e427a1","block_type":"box","text":"General.","page_number":82,"box":{"x":102,"y":166,"width":58,"height":9}},{"id":"c0c8885c-ba6c-4306-a1c7-f05880dfeb57","block_type":"box","text":"Cer tain Funds may invest in the securities of issuers domiciled in various countries with emerging capital","page_number":82,"box":{"x":102,"y":188,"width":748,"height":12}},{"id":"d58b2a78-e2a6-4ed3-bec8-bf775fee1f1d","block_type":"box","text":"markets. Unless otherwise provided in a Fund’s Prospectus, a country with an emerging capital market is any country","page_number":82,"box":{"x":69,"y":204,"width":840,"height":11}},{"id":"80c4f9b7-591e-484d-ba6c-ec89251c28b4","block_type":"box","text":"that is (i) generally recognized to be an emerging market country by the international financial community, such as","page_number":82,"box":{"x":68,"y":218,"width":813,"height":12}},{"id":"d4f8dfe1-3c86-4966-abab-531763c4289a","block_type":"box","text":"the International Finance Corporation, or determined by the World Bank to have a low, middle or middle upper income","page_number":82,"box":{"x":68,"y":234,"width":836,"height":11}},{"id":"a6f0cc7a-d41e-4dc9-befd-7309829cb400","block_type":"box","text":"economy; (ii) classified by the United Nations or its authorities to be developing; and/or (iii) included in a broad-based","page_number":82,"box":{"x":69,"y":249,"width":839,"height":11}},{"id":"ec605d2f-e5ff-4758-be4f-680e006f9420","block_type":"box","text":"index that is generally representative of emerging markets. Countries with emerging markets can be found in regions","page_number":82,"box":{"x":70,"y":264,"width":831,"height":11}},{"id":"4fa5924e-e19d-422d-91b3-6cd376429ba1","block_type":"box","text":"such as Asia, Latin America, Eastern Europe and Africa.","page_number":82,"box":{"x":69,"y":279,"width":396,"height":11}},{"id":"cc86c80d-1c63-4038-b8e6-4659014114fd","block_type":"box","text":"Investments in the securities of issuers domiciled in countries with emerging capital markets involve cer tain","page_number":82,"box":{"x":102,"y":302,"width":770,"height":11}},{"id":"0deb6852-6b55-4f6b-842a-23e78ede5f84","block_type":"box","text":"additional risks that do not generally apply to investments in securities of issuers in more developed capital markets,","page_number":82,"box":{"x":69,"y":317,"width":835,"height":11}},{"id":"61d78222-6bf5-426e-a4ae-22bf97b61eb7","block_type":"box","text":"such as (i) low or non-existent trading volume, resulting in market illiquidity and increased volatility in prices for such","page_number":82,"box":{"x":69,"y":332,"width":828,"height":11}},{"id":"343dd961-71b6-468c-8f44-a13bb2d901e8","block_type":"box","text":"securities, as compared to securities of comparable issuers in more developed capital markets; (ii) uncer tain","page_number":82,"box":{"x":69,"y":347,"width":779,"height":11}},{"id":"625554ce-95ea-4dab-8ee5-ce94c0736a51","block_type":"box","text":"national policies and social, political and economic instability, increasing the potential for expropriation of assets,","page_number":82,"box":{"x":69,"y":362,"width":809,"height":11}},{"id":"532605d0-ecf5-46b9-bbfa-8aed7a939fd2","block_type":"box","text":"confiscatory taxation, high rates of inflation or unfavorable diplomatic developments; (iii) possible fluctuations in","page_number":82,"box":{"x":69,"y":377,"width":800,"height":12}},{"id":"addd008d-64b5-4e82-ba69-4e46d884832f","block_type":"box","text":"exchange rates, differing legal systems and the existence or possible imposition of exchange controls, custodial","page_number":82,"box":{"x":69,"y":392,"width":800,"height":12}},{"id":"b3f0e5ac-eb06-4026-9028-3c7d329f6429","block_type":"box","text":"restrictions or other foreign or U.S. Governmental laws or restrictions applicable to such investments; (iv) national","page_number":82,"box":{"x":69,"y":407,"width":811,"height":12}},{"id":"25d816d0-de4d-4d1c-a1e4-e8e968a957c9","block_type":"box","text":"policies that may limit a Fund’s investment oppor tunities such as restrictions on investment in issuers or industries","page_number":82,"box":{"x":70,"y":423,"width":824,"height":11}},{"id":"26bb6069-2e80-4f8c-b6cf-d2605513aa2b","block_type":"box","text":"deemed sensitive to national interests; and (v) the lack or relatively early development of legal structures governing","page_number":82,"box":{"x":69,"y":438,"width":823,"height":11}},{"id":"70ea0d64-a3ea-4306-baa9-da732fe78c91","block_type":"box","text":"private and foreign investments and private proper ty. In addition to withholding taxes on investment income, some","page_number":82,"box":{"x":70,"y":453,"width":813,"height":11}},{"id":"9d66a728-131d-4157-aee7-a118f0296f5a","block_type":"box","text":"countries with emerging markets may impose differential capital gains taxes on foreign investors.","page_number":82,"box":{"x":69,"y":468,"width":694,"height":11}},{"id":"a2d07995-cb7b-4913-8fc9-3a7837c8b195","block_type":"box","text":"Political and economic structures in emerging market countries may be undergoing significant evolution and","page_number":82,"box":{"x":102,"y":491,"width":767,"height":11}},{"id":"5a58a3bf-2b08-47b3-a571-1520688d9d7b","block_type":"box","text":"rapid development, and these countries may lack the social, political and economic stability characteristic of more","page_number":82,"box":{"x":69,"y":506,"width":814,"height":11}},{"id":"9a801893-642c-4295-a143-bb713bbaae44","block_type":"box","text":"developed countries. In such a dynamic environment, there can be no assurance that any or all of these capital","page_number":82,"box":{"x":69,"y":521,"width":792,"height":11}},{"id":"bedb78cd-89f6-4cd6-aba3-327d65779c64","block_type":"box","text":"markets will continue to present viable investment oppor tunities for a Fund. In the past, governments of such nations","page_number":82,"box":{"x":69,"y":536,"width":838,"height":11}},{"id":"fbd0c8ff-f1bd-44e7-bd0a-228ceeeda10a","block_type":"box","text":"have expropriated substantial amounts of private proper ty, and most claims of the proper ty owners have never been","page_number":82,"box":{"x":69,"y":551,"width":828,"height":11}},{"id":"807a4e34-9653-43c3-b5e7-29dfa7f6a781","block_type":"box","text":"fully settled. There is no assurance that such expropriations will not reoccur. In such an event, it is possible that a","page_number":82,"box":{"x":68,"y":566,"width":816,"height":11}},{"id":"b4792542-98a3-474a-9d4b-3dd067a8aed1","block_type":"box","text":"Fund could lose the entire value of its investments in the affected market. As a result the risks described above,","page_number":82,"box":{"x":70,"y":581,"width":802,"height":11}},{"id":"72c2282e-3943-4553-8dd7-6b67d65f9e0f","block_type":"box","text":"including the risks of nationalization or expropriation of assets, may be heightened. In addition, unanticipated political","page_number":82,"box":{"x":70,"y":596,"width":838,"height":12}},{"id":"4bd35666-8257-4aa3-b0b0-a276ee7b0408","block_type":"box","text":"or social developments may affect the value of investments in these countries and the availability to a Fund of","page_number":82,"box":{"x":69,"y":612,"width":788,"height":11}},{"id":"ced2ca7d-1fd2-4201-a70d-6c296121ce6e","block_type":"box","text":"additional investments. The small size and inexperience of the securities markets in cer tain of these countries and","page_number":82,"box":{"x":69,"y":627,"width":819,"height":11}},{"id":"7e96f24e-fa04-46da-8347-e8d4a6ff5e98","block_type":"box","text":"the limited volume of trading in securities in these countries may make investments in the countries illiquid and more","page_number":82,"box":{"x":68,"y":642,"width":838,"height":11}},{"id":"b4ff3f63-ac74-4bd7-9f68-9530b1b66cea","block_type":"box","text":"volatile than investments in more established markets.","page_number":82,"box":{"x":68,"y":657,"width":392,"height":9}},{"id":"30ab124f-9115-48f4-8c50-c0f1d9485402","block_type":"box","text":"Also, there may be less publicly available information about issuers in emerging markets than would be available","page_number":82,"box":{"x":101,"y":680,"width":805,"height":11}},{"id":"66634b78-f09a-4bd9-b471-e5a57eed2386","block_type":"box","text":"about issuers in more developed capital markets, and such issuers may not be subject to accounting, auditing and","page_number":82,"box":{"x":69,"y":695,"width":818,"height":11}},{"id":"694f9289-916a-4ab1-8a05-41d6a36d0201","block_type":"box","text":"financial repor ting standards and requirements comparable to those to which U.S. companies are subject. In cer tain","page_number":82,"box":{"x":68,"y":710,"width":831,"height":11}},{"id":"1fe93801-36f3-4ad9-8879-53cb56a22aa2","block_type":"box","text":"countries with emerging capital markets, repor ting standards vary widely. As a result, traditional investment","page_number":82,"box":{"x":69,"y":725,"width":768,"height":11}},{"id":"dc772d15-5a03-420b-995e-3e2b31ba6851","block_type":"box","text":"measurements used in the United States, such as price/earnings ratios, may not be applicable. Emerging market","page_number":82,"box":{"x":69,"y":740,"width":811,"height":11}},{"id":"65742b85-8d16-4247-82a5-cf5ad4317b4d","block_type":"box","text":"securities may be substantially less liquid than, and more volatile than, those of mature markets, and company","page_number":82,"box":{"x":69,"y":755,"width":795,"height":11}},{"id":"eaeefb25-a95a-4d9d-9e07-c9ccef921e89","block_type":"box","text":"shares may be held by a limited number of persons. This may adversely affect the timing and pricing of the Fund’s","page_number":82,"box":{"x":69,"y":770,"width":814,"height":12}},{"id":"6b581c64-39f7-46ba-b5ef-93688120b583","block_type":"box","text":"acquisition or disposal of securities.","page_number":82,"box":{"x":69,"y":785,"width":257,"height":11}},{"id":"e4801a20-b071-4f8e-90ba-2c92a2402647","block_type":"box","text":"Practices in relation to settlement of securities transactions in emerging markets involve higher risks than those","page_number":82,"box":{"x":102,"y":808,"width":800,"height":11}},{"id":"41f8278c-6080-4459-93b6-e3d22cd308fd","block_type":"box","text":"in developed markets, in par t because a Fund will need to use brokers and counterpar ties that are less well","page_number":82,"box":{"x":70,"y":823,"width":769,"height":11}},{"id":"b37603ba-325f-4085-a434-84d0f806a1b1","block_type":"box","text":"capitalized, and custody and registration of assets in some countries may be unreliable. The possibility of fraud,","page_number":82,"box":{"x":69,"y":838,"width":798,"height":12}},{"id":"964beb60-8f5f-4967-a484-8bd512aad398","block_type":"box","text":"negligence, undue influence being exer ted by the issuer or refusal to recognize ownership exists in some emerging","page_number":82,"box":{"x":69,"y":853,"width":819,"height":12}},{"id":"53538bb3-ed8b-44c1-bac9-6e6c0c105c53","block_type":"box","text":"markets, and, along with other factors, could result in ownership registration being completely lost. A Fund would","page_number":82,"box":{"x":69,"y":869,"width":804,"height":11}},{"id":"6b804ca0-d832-4e04-ae48-688be9d881c2","block_type":"box","text":"absorb any loss resulting from such registration problems and may have no successful claim for compensation.","page_number":82,"box":{"x":69,"y":884,"width":794,"height":11}},{"id":"c7c4f4dc-f695-400a-9eaa-368efd097904","block_type":"box","text":"II-35","page_number":82,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"67d36745-d2a4-426c-bb30-c98e75ae37b2","block_type":"box","text":"NM1026U-6033063-82/246","page_number":82,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"a4f1c33a-6a5e-4a65-88dc-a8a11b350f6d","block_type":"box","text":"Investment in non-dollar denominated securities including securities from issuers located in emerging market","page_number":83,"box":{"x":102,"y":45,"width":778,"height":11}},{"id":"cf000e82-093a-4c8f-b4a9-16d71f181bba","block_type":"box","text":"countries may be on either a currency hedged or unhedged basis, and the Funds may hold from time to time various","page_number":83,"box":{"x":69,"y":60,"width":827,"height":11}},{"id":"e61019f7-aa12-4b76-b7a7-d080072eb3ec","block_type":"box","text":"foreign currencies pending investment or conversion into U.S. dollars. Some of these instruments may have the","page_number":83,"box":{"x":68,"y":75,"width":797,"height":11}},{"id":"4505aa68-2bed-4282-a7ff-0a2fe865efd2","block_type":"box","text":"characteristics of futures contracts. In addition, cer tain Funds may engage in foreign currency exchange transactions","page_number":83,"box":{"x":69,"y":90,"width":832,"height":11}},{"id":"5704144f-46ce-4087-bc77-510764f524f6","block_type":"box","text":"to seek to protect against changes in the level of future exchange rates which would adversely affect the Fund’s","page_number":83,"box":{"x":68,"y":105,"width":799,"height":11}},{"id":"ccf45fe6-c186-4688-9cee-f240ecb999f5","block_type":"box","text":"per formance. These investments and transactions involving foreign securities, currencies, options (including options","page_number":83,"box":{"x":70,"y":120,"width":829,"height":12}},{"id":"4f178605-6dc4-4423-b71e-9c09b46ae645","block_type":"box","text":"that relate to foreign currencies), futures, hedging and cross-hedging are described under “Derivatives.”","page_number":83,"box":{"x":68,"y":135,"width":740,"height":12}},{"id":"51475bce-db8d-4625-ab14-9fcc4396094b","block_type":"box","text":"Risks of Investing in Asia-Pacific Countries.","page_number":83,"box":{"x":102,"y":158,"width":305,"height":11}},{"id":"a873efc8-f7d8-489f-8687-0ee09f5bf6a2","block_type":"box","text":"In addition to the risks of foreign investing and the risks of investing","page_number":83,"box":{"x":414,"y":158,"width":485,"height":11}},{"id":"b1efc2b9-7fe3-4460-970c-f84d2aa97229","block_type":"box","text":"in developing markets, the developing market Asia-Pacific countries in which a Fund may invest are subject to cer tain","page_number":83,"box":{"x":70,"y":173,"width":832,"height":11}},{"id":"44243bbd-c22b-4ebe-aa14-7900b0b7e704","block_type":"box","text":"additional or specific risks. Cer tain Funds may make substantial investments in Asia-Pacific countries. In many of","page_number":83,"box":{"x":69,"y":188,"width":808,"height":11}},{"id":"e5d086cb-5724-4c64-8a5e-3324d5a0012f","block_type":"box","text":"these markets, there is a high concentration of market capitalization and trading volume in a small number of issuers","page_number":83,"box":{"x":68,"y":203,"width":838,"height":12}},{"id":"83d1eae8-c88a-4f27-9104-9b842d886b43","block_type":"box","text":"representing a limited number of industries, as well as a high concentration of investors and financial intermediaries.","page_number":83,"box":{"x":69,"y":218,"width":834,"height":12}},{"id":"0aea475a-d03f-414d-b6d6-5d730ee7ba74","block_type":"box","text":"Many of these markets also may be affected by developments with respect to more established markets in the","page_number":83,"box":{"x":70,"y":234,"width":791,"height":11}},{"id":"ece6d6fa-61ce-4543-95fb-c69854eba5f3","block_type":"box","text":"region such as in Japan and Hong Kong. Brokers in developing market Asia-Pacific countries typically are fewer in","page_number":83,"box":{"x":69,"y":249,"width":804,"height":11}},{"id":"56e03412-9724-452d-bb01-02bf762af895","block_type":"box","text":"number and less well capitalized than brokers in the United States. These factors, combined with the U.S. regulatory","page_number":83,"box":{"x":69,"y":264,"width":833,"height":11}},{"id":"9e0ab3ab-4a6e-40a4-bd1a-0e700c3eaaee","block_type":"box","text":"requirements for open-end investment companies and the restrictions on foreign investment discussed below, result","page_number":83,"box":{"x":69,"y":279,"width":830,"height":11}},{"id":"068e56b9-ebd6-4b83-92a2-bb14d05fe512","block_type":"box","text":"in potentially fewer investment oppor tunities for a Fund and may have an adverse impact on the investment","page_number":83,"box":{"x":70,"y":294,"width":766,"height":11}},{"id":"322bc6d1-af06-40e5-a234-dd9b65f6b368","block_type":"box","text":"per formance of the Fund.","page_number":83,"box":{"x":70,"y":309,"width":179,"height":11}},{"id":"7ee4ed69-a175-4a3c-9590-81dfec641e72","block_type":"box","text":"Many of the developing market Asia-Pacific countries may be subject to a greater degree of economic, political","page_number":83,"box":{"x":102,"y":332,"width":784,"height":11}},{"id":"e627a8c0-8d7c-4629-bbd3-3c7194221da4","block_type":"box","text":"and social instability than is the case in the United States and Western European countries. Such instability may","page_number":83,"box":{"x":69,"y":347,"width":803,"height":11}},{"id":"b3abb461-4aa3-405d-8d2a-bbb8a23c8e50","block_type":"box","text":"result from, among other things: (i) authoritarian governments or military involvement in political and economic","page_number":83,"box":{"x":69,"y":362,"width":788,"height":11}},{"id":"9589d792-4116-48b1-ae9c-b4c4fa24e7d6","block_type":"box","text":"decision-making, including changes in government through extra-constitutional means; (ii) popular unrest associated","page_number":83,"box":{"x":69,"y":377,"width":827,"height":12}},{"id":"5f00ebf7-68b8-425b-bd5c-e497319c1f6b","block_type":"box","text":"with demands for improved political, economic and social conditions; (iii) internal insurgencies; (iv) hostile relations","page_number":83,"box":{"x":68,"y":392,"width":823,"height":12}},{"id":"1a40ad5c-6c04-4ae8-9d85-5dd4582f4594","block_type":"box","text":"with neighboring countries; and (v) ethnic, religious and racial disaffection. In addition, the governments of many of","page_number":83,"box":{"x":68,"y":407,"width":822,"height":12}},{"id":"5a962659-1e5a-4fd0-801f-cfd201d3446a","block_type":"box","text":"such countries, such as Indonesia, have a substantial role in regulating and supervising the economy. Another risk","page_number":83,"box":{"x":69,"y":423,"width":818,"height":11}},{"id":"1c62282a-d5df-400b-86f3-bd4f15caab7f","block_type":"box","text":"common to most such countries is that the economy is heavily expor t oriented and, accordingly, is dependent upon","page_number":83,"box":{"x":69,"y":438,"width":821,"height":11}},{"id":"22fc248c-87d9-4d94-bb7c-5a25baa3d8fc","block_type":"box","text":"international trade. The existence of overburdened infrastructure and obsolete financial systems also presents risks","page_number":83,"box":{"x":70,"y":453,"width":827,"height":11}},{"id":"3c3d7910-247a-46ce-b0b6-de7c07ddc995","block_type":"box","text":"in cer tain countries, as do environmental problems. Cer tain economies also depend to a significant degree upon","page_number":83,"box":{"x":70,"y":468,"width":803,"height":11}},{"id":"19fac6f4-7b7d-4b58-b5a1-5454f0403175","block_type":"box","text":"expor ts of primary commodities and, therefore, are vulnerable to changes in commodity prices that, in turn, may be","page_number":83,"box":{"x":69,"y":483,"width":824,"height":11}},{"id":"86044f99-a693-4e1f-b909-a0a911ff13b4","block_type":"box","text":"affected by a variety of factors.","page_number":83,"box":{"x":69,"y":498,"width":220,"height":11}},{"id":"fd2d6a0b-983e-43b3-afd3-b81d04cbca97","block_type":"box","text":"The legal systems in cer tain developing market Asia-Pacific countries also may have an adverse impact on the","page_number":83,"box":{"x":101,"y":521,"width":785,"height":11}},{"id":"d7eddefe-3383-4f8b-a261-8e5db751cda4","block_type":"box","text":"Fund. For example, while the potential liability of a shareholder in a U.S. corporation with respect to acts of the","page_number":83,"box":{"x":70,"y":536,"width":789,"height":11}},{"id":"57899c03-c1c4-45a9-8abe-a7d2479e744a","block_type":"box","text":"corporation is generally limited to the amount of the shareholder’s investment, the notion of limited liability is less","page_number":83,"box":{"x":69,"y":551,"width":814,"height":11}},{"id":"864087cb-9371-4bd2-8c21-cf6942494a00","block_type":"box","text":"clear in cer tain emerging market Asia-Pacific countries. Similarly, the rights of investors in developing market Asia","page_number":83,"box":{"x":69,"y":566,"width":813,"height":11}},{"id":"752eeb63-509d-420e-b98c-7155a6c2ac14","block_type":"box","text":"Pacific companies may be more limited than those of shareholders of U.S. corporations. It may be difficult or","page_number":83,"box":{"x":69,"y":581,"width":777,"height":11}},{"id":"3e5f82a0-f674-4ff2-a32a-02785e6f179b","block_type":"box","text":"impossible to obtain and/or enforce a judgment in a developing market Asia-Pacific country.","page_number":83,"box":{"x":70,"y":596,"width":652,"height":12}},{"id":"ef7b0884-6ff2-4856-8328-163dba82d503","block_type":"box","text":"Governments of many developing market Asia-Pacific countries have exercised and continue to exercise","page_number":83,"box":{"x":102,"y":619,"width":737,"height":11}},{"id":"69004831-ea17-419e-88ab-5d767019c59e","block_type":"box","text":"substantial influence over many aspects of the private sector. In cer tain cases, the government owns or controls","page_number":83,"box":{"x":69,"y":634,"width":803,"height":12}},{"id":"ced64b65-4a18-435f-8c63-eb9a64cfc883","block_type":"box","text":"many companies, including the largest in the country. Accordingly, government actions in the future could have a","page_number":83,"box":{"x":69,"y":649,"width":801,"height":12}},{"id":"07857a47-7dc8-4319-be16-4ad9257ee1f6","block_type":"box","text":"significant effect on economic conditions in developing market Asia-Pacific countries, which could affect private","page_number":83,"box":{"x":69,"y":664,"width":793,"height":12}},{"id":"e3cff866-b281-4e1d-95b4-46bad76a5332","block_type":"box","text":"sector companies and a Fund itself, as well as the value of securities in the Fund’s por tfolio. In addition, economic","page_number":83,"box":{"x":69,"y":680,"width":820,"height":11}},{"id":"6d1fddbf-3398-4e29-b7f4-f59a3299a5ee","block_type":"box","text":"statistics of developing market Asia-Pacific countries may be less reliable than economic statistics of more developed","page_number":83,"box":{"x":69,"y":695,"width":839,"height":11}},{"id":"1dfc2ac6-0849-4669-9c2f-b38d6fc78197","block_type":"box","text":"nations.","page_number":83,"box":{"x":69,"y":710,"width":56,"height":9}},{"id":"3d04ca30-0ecb-40ec-a8a1-993bec8729de","block_type":"box","text":"In addition to the relative lack of publicly available information about developing market Asia-Pacific issuers and","page_number":83,"box":{"x":102,"y":732,"width":794,"height":12}},{"id":"991c28b5-66b7-4d0c-b7f4-cba346d56b1c","block_type":"box","text":"the possibility that such issuers may not be subject to the same accounting, auditing and financial repor ting","page_number":83,"box":{"x":68,"y":748,"width":773,"height":11}},{"id":"5b39fcd0-fba9-434c-856d-97a70b9b0bc1","block_type":"box","text":"standards as U.S. companies, inflation accounting rules in some developing market Asia-Pacific countries require","page_number":83,"box":{"x":69,"y":763,"width":808,"height":11}},{"id":"65b1ec40-6e93-41c0-826a-b45c304307fa","block_type":"box","text":"companies that keep accounting records in the local currency, for both tax and accounting purposes, to restate","page_number":83,"box":{"x":69,"y":778,"width":791,"height":11}},{"id":"c73f0eb4-13e9-4a48-99c2-fa4f59989e28","block_type":"box","text":"cer tain assets and liabilities on the company’s balance sheet in order to express items in terms of currency of","page_number":83,"box":{"x":69,"y":793,"width":790,"height":11}},{"id":"b9353ad8-e024-4f27-8303-db9f6b10b0b1","block_type":"box","text":"constant purchasing power. Inflation accounting may indirectly generate losses or profits for cer tain developing","page_number":83,"box":{"x":69,"y":808,"width":790,"height":11}},{"id":"65271c8e-dd6e-41df-aa1c-fd5152d454bb","block_type":"box","text":"market Asia-Pacific companies.","page_number":83,"box":{"x":69,"y":823,"width":220,"height":11}},{"id":"90657622-4e2f-4e95-864c-a75849dde0eb","block_type":"box","text":"Satisfactory custodial services for investment securities may not be available in some developing Asia-Pacific","page_number":83,"box":{"x":102,"y":846,"width":780,"height":11}},{"id":"5c17820a-3a83-4f05-af34-2fa3d7b66b93","block_type":"box","text":"countries, which may result in the Fund incurring additional costs and delays in providing transpor tation and custody","page_number":83,"box":{"x":69,"y":861,"width":829,"height":11}},{"id":"19ec4922-c90d-4c87-84f2-376cb2ca7b35","block_type":"box","text":"services for such securities outside such countries.","page_number":83,"box":{"x":69,"y":876,"width":367,"height":9}},{"id":"0c6ac5e5-daed-4aa9-b2af-47aa66ce37a3","block_type":"box","text":"II-36","page_number":83,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"51d2d18a-0ca5-4c7a-ba70-1d9590b342bf","block_type":"box","text":"NM1026U-6033063-83/246","page_number":83,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"ed22f21d-6bf2-40e5-a921-818ac2f594e0","block_type":"box","text":"Cer tain developing Asia-Pacific countries, such as the Philippines, India and Turkey, are especially large debtors","page_number":84,"box":{"x":102,"y":45,"width":795,"height":11}},{"id":"17c95533-fd7b-4f3f-a8b5-6c5e4551d726","block_type":"box","text":"to commercial banks and foreign governments.","page_number":84,"box":{"x":68,"y":60,"width":335,"height":11}},{"id":"9b2c59b9-d41f-4433-b27e-2e73672eb260","block_type":"box","text":"Natural disasters in Asia-Pacific countries, and the resulting damage, could have a severe and negative impact","page_number":84,"box":{"x":102,"y":82,"width":788,"height":12}},{"id":"a5f616cd-6995-4b1b-8689-72ec60cc075f","block_type":"box","text":"on a Fund’s investment por tfolio and, in the longer term, could impair the ability of issuers in which the Fund invests","page_number":84,"box":{"x":69,"y":98,"width":830,"height":11}},{"id":"dda0a3f0-b1ba-4d12-933b-4691d9affc38","block_type":"box","text":"to conduct their businesses in the manner normally conducted.","page_number":84,"box":{"x":68,"y":113,"width":450,"height":11}},{"id":"e6f96c76-f925-4d52-93ed-d1ca0acd7298","block_type":"box","text":"Fund management may determine that, notwithstanding otherwise favorable investment criteria, it may not be","page_number":84,"box":{"x":102,"y":135,"width":782,"height":12}},{"id":"d839fe21-ca01-4b6f-8897-baab722f34be","block_type":"box","text":"practicable or appropriate to invest in a par ticular developing Asia-Pacific country. A Fund may invest in countries in","page_number":84,"box":{"x":70,"y":150,"width":819,"height":12}},{"id":"10ccf1e4-be3c-45a9-9791-b4d974a9d796","block_type":"box","text":"which foreign investors, including management of the Fund, have had no or limited prior experience.","page_number":84,"box":{"x":68,"y":166,"width":711,"height":11}},{"id":"1d3d6942-3c8b-4cdc-8543-53b19f502e7b","block_type":"box","text":"Restrictions on Foreign Investments in Asia-Pacific Countries.","page_number":84,"box":{"x":102,"y":188,"width":435,"height":12}},{"id":"294fa4b3-b254-4624-a976-c66f903edc43","block_type":"box","text":"Some developing Asia-Pacific countries prohibit or","page_number":84,"box":{"x":543,"y":188,"width":355,"height":12}},{"id":"ce3507ba-cf31-4dbc-9fef-310f417d2a5e","block_type":"box","text":"impose substantial restrictions on investments in their capital markets, par ticularly their equity markets, by foreign","page_number":84,"box":{"x":70,"y":203,"width":817,"height":12}},{"id":"5a6c790e-10d1-4ef0-bfa1-13d46995f4b1","block_type":"box","text":"entities such as a Fund. As illustrations, cer tain countries may require governmental approval prior to investments by","page_number":84,"box":{"x":69,"y":219,"width":836,"height":11}},{"id":"1e831a05-4f23-4048-b514-8fcaaae87208","block_type":"box","text":"foreign persons or limit the amount of investment by foreign persons in a par ticular company or limit the investment","page_number":84,"box":{"x":68,"y":234,"width":828,"height":11}},{"id":"ade1a0da-7a01-4f28-9467-d96e86feb9a1","block_type":"box","text":"by foreign persons to only a specific class of securities of a company which may have less advantageous terms","page_number":84,"box":{"x":69,"y":249,"width":794,"height":11}},{"id":"30998e96-d412-431a-8ef2-d3ca50914948","block_type":"box","text":"(including price and shareholder rights) than securities of the company available for purchase by nationals. There can","page_number":84,"box":{"x":69,"y":264,"width":835,"height":11}},{"id":"a15b1cbc-2073-4324-952d-612cc17de39e","block_type":"box","text":"be no assurance that a Fund will be able to obtain required governmental approvals in a timely manner. In addition,","page_number":84,"box":{"x":69,"y":279,"width":820,"height":11}},{"id":"53059fb9-258d-4f9e-a71d-f25d7ad4b207","block_type":"box","text":"changes to restrictions on foreign ownership of securities subsequent to a Fund’s purchase of such securities may","page_number":84,"box":{"x":69,"y":294,"width":820,"height":11}},{"id":"5bbf62ad-cd72-47d4-bda1-5a2f6f1f682a","block_type":"box","text":"have an adverse effect on the value of such shares. Cer tain countries may restrict investment oppor tunities in","page_number":84,"box":{"x":69,"y":309,"width":788,"height":11}},{"id":"d17dc0cc-2646-40ad-a506-27afdd329eb2","block_type":"box","text":"issuers or industries deemed impor tant to national interests.","page_number":84,"box":{"x":70,"y":325,"width":434,"height":10}},{"id":"b365a4ca-6e07-42b2-bd0c-95a8a4db123e","block_type":"box","text":"The manner in which foreign investors may invest in companies in cer tain developing Asia-Pacific countries, as","page_number":84,"box":{"x":101,"y":347,"width":787,"height":11}},{"id":"685e9594-9d1a-474c-a2ea-d03d0279a8f0","block_type":"box","text":"well as limitations on such investments, also may have an adverse impact on the operations of a Fund. For example,","page_number":84,"box":{"x":68,"y":362,"width":833,"height":11}},{"id":"9463def2-8094-44d6-9d61-727d8eb75333","block_type":"box","text":"a Fund may be required in cer tain of such countries to invest initially through a local broker or other entity and then","page_number":84,"box":{"x":69,"y":377,"width":820,"height":12}},{"id":"2d27d3fd-22d1-422f-a0e3-67fbcb4b44ae","block_type":"box","text":"have the shares purchased re-registered in the name of the Fund. Re-registration may in some instances not be able","page_number":84,"box":{"x":69,"y":392,"width":831,"height":12}},{"id":"0e69204c-5c8a-4aa5-8110-8b8944c66d46","block_type":"box","text":"to occur on a timely basis, resulting in a delay during which a Fund may be denied cer tain of its rights as an investor,","page_number":84,"box":{"x":68,"y":407,"width":834,"height":12}},{"id":"12e6f5f8-9560-4c28-b579-996e48174ed1","block_type":"box","text":"including rights as to dividends or to be made aware of cer tain corporate actions. There also may be instances where","page_number":84,"box":{"x":70,"y":423,"width":836,"height":11}},{"id":"8a988b92-69e0-412f-b779-c6f44d61afd6","block_type":"box","text":"a Fund places a purchase order but is subsequently informed, at the time of re-registration, that the permissible","page_number":84,"box":{"x":69,"y":438,"width":800,"height":11}},{"id":"01caa50b-c065-4641-8511-46b3954f1986","block_type":"box","text":"allocation of the investment to foreign investors has been filled, depriving the Fund of the ability to make its desired","page_number":84,"box":{"x":69,"y":453,"width":826,"height":11}},{"id":"dbaa0ad8-c606-48f7-855d-a998e9099c52","block_type":"box","text":"investment at that time.","page_number":84,"box":{"x":70,"y":468,"width":168,"height":9}},{"id":"7887637c-9b3b-4cf3-8a3a-998c4ddb1ebd","block_type":"box","text":"Substantial limitations may exist in cer tain countries with respect to a Fund’s ability to repatriate investment","page_number":84,"box":{"x":102,"y":491,"width":774,"height":11}},{"id":"c7682495-6a90-4420-b3f1-8fba4ba00126","block_type":"box","text":"income, capital or the proceeds of sales of securities by foreign investors. A Fund could be adversely affected by","page_number":84,"box":{"x":70,"y":506,"width":803,"height":11}},{"id":"1abba892-6e27-480d-8da0-1f57dcee3f68","block_type":"box","text":"delays in, or a refusal to grant, any required governmental approval for repatriation of capital, as well as by the","page_number":84,"box":{"x":69,"y":521,"width":789,"height":11}},{"id":"1e871921-9adc-4a87-be5c-bb5b9c0419e4","block_type":"box","text":"application to the Fund of any restrictions on investments. It is possible that cer tain countries may impose currency","page_number":84,"box":{"x":69,"y":536,"width":826,"height":11}},{"id":"a4059e53-07e7-406d-9a22-860b49d5b863","block_type":"box","text":"controls or other restrictions relating to their currencies or to securities of issuers in those countries. To the extent","page_number":84,"box":{"x":69,"y":551,"width":818,"height":11}},{"id":"381d2455-558b-4420-a609-dab55483da46","block_type":"box","text":"that such restrictions have the effect of making cer tain investments illiquid, securities may not be available for sale","page_number":84,"box":{"x":68,"y":566,"width":826,"height":11}},{"id":"da66d9da-4116-4363-8a1c-a992695bf06e","block_type":"box","text":"to meet redemptions. Depending on a variety of financial factors, the percentage of a Fund’s por tfolio subject to","page_number":84,"box":{"x":68,"y":581,"width":800,"height":12}},{"id":"0c95b73f-8214-4486-8f40-761a19d98e71","block_type":"box","text":"currency controls may increase. In the event other countries impose similar controls, the por tion of the Fund’s assets","page_number":84,"box":{"x":69,"y":596,"width":839,"height":12}},{"id":"9d8b9e9e-f72b-43cf-92c5-1d118ca5753e","block_type":"box","text":"that may be used to meet redemptions may be fur ther decreased. Even where there is no outright restriction on","page_number":84,"box":{"x":68,"y":612,"width":798,"height":11}},{"id":"e5e4550a-0bcb-4955-9c10-d3199fa0cbbe","block_type":"box","text":"repatriation of capital, the mechanics of repatriation may affect cer tain aspects of the operations of a Fund (for","page_number":84,"box":{"x":69,"y":627,"width":795,"height":11}},{"id":"e9476989-d178-4661-bf63-ee2e90d34e2f","block_type":"box","text":"example, if funds may be withdrawn only in cer tain currencies and/or only at an exchange rate established by the","page_number":84,"box":{"x":69,"y":642,"width":808,"height":11}},{"id":"8b7f9520-d921-4732-b9de-66b890ca3211","block_type":"box","text":"government).","page_number":84,"box":{"x":68,"y":657,"width":92,"height":11}},{"id":"148f68d0-3e82-4f93-9053-28a0923a4c3d","block_type":"box","text":"In cer tain countries, banks or other financial institutions may be among the leading companies or have actively","page_number":84,"box":{"x":102,"y":680,"width":790,"height":11}},{"id":"fb8303d8-60be-459e-a3cd-6d4f5b95decb","block_type":"box","text":"traded securities available for investment. The Investment Company Act restricts a Fund’s investments in any equity","page_number":84,"box":{"x":68,"y":695,"width":828,"height":11}},{"id":"b71b5b9e-a060-41aa-9df5-697ebb914fcf","block_type":"box","text":"securities of an issuer that, in its most recent fiscal year, derived more than 15% of its revenues from “securities","page_number":84,"box":{"x":69,"y":710,"width":808,"height":11}},{"id":"c16c6794-6ca3-4ee0-afd4-0881c7318065","block_type":"box","text":"related activities,” as defined by the rules thereunder. These provisions may restrict a Fund’s investments in cer tain","page_number":84,"box":{"x":69,"y":725,"width":829,"height":11}},{"id":"4ed6051b-8074-4102-9941-c927553e1e4c","block_type":"box","text":"foreign banks and other financial institutions.","page_number":84,"box":{"x":68,"y":740,"width":322,"height":11}},{"id":"95ac2c00-59df-4152-b80b-bdec02c23bea","block_type":"box","text":"Political and economic structures in emerging market countries may be undergoing significant evolution and","page_number":84,"box":{"x":102,"y":763,"width":767,"height":11}},{"id":"00e14a2c-cf5f-4108-966f-35ea00a6dbe3","block_type":"box","text":"rapid development, and these countries may lack the social, political and economic stability characteristic of more","page_number":84,"box":{"x":69,"y":778,"width":814,"height":11}},{"id":"d91c275d-4cdc-4583-8f47-bc6755fca679","block_type":"box","text":"developed countries. Some of these countries may have in the past failed to recognize private proper ty rights and","page_number":84,"box":{"x":69,"y":793,"width":809,"height":11}},{"id":"004b0972-e4c2-46b6-8245-882abc1de333","block_type":"box","text":"have at times nationalized or expropriated the assets of private companies. As a result the risks described above,","page_number":84,"box":{"x":69,"y":808,"width":812,"height":11}},{"id":"e9271b4a-8db1-4256-bb5c-b1a909bfbcc3","block_type":"box","text":"including the risks of nationalization or expropriation of assets, may be heightened. In addition, unanticipated political","page_number":84,"box":{"x":70,"y":823,"width":838,"height":12}},{"id":"0636661b-c1b2-4f9f-87b2-f9c487dc56b6","block_type":"box","text":"or social developments may affect the value of investments in these countries and the availability to a Fund of","page_number":84,"box":{"x":69,"y":838,"width":788,"height":11}},{"id":"d5b06f8f-f681-4e46-8a2c-e295c2aae5a2","block_type":"box","text":"additional investments in emerging market countries. The small size and inexperience of the securities markets in","page_number":84,"box":{"x":69,"y":853,"width":812,"height":12}},{"id":"a0b88eba-a9fc-48b6-81ee-c54b965de8fa","block_type":"box","text":"cer tain of these countries and the limited volume of trading in securities in these countries may make investments in","page_number":84,"box":{"x":69,"y":869,"width":835,"height":11}},{"id":"80ffcac5-59b6-47b1-a496-c9b3a708e9a7","block_type":"box","text":"the countries illiquid and more volatile than investments in Japan or most Western European countries. There may be","page_number":84,"box":{"x":68,"y":884,"width":837,"height":11}},{"id":"bb0f19b7-b047-4e4b-a978-97eebc7607cd","block_type":"box","text":"II-37","page_number":84,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"98467f21-bc20-4f85-8bad-b0f0eb2705ca","block_type":"box","text":"NM1026U-6033063-84/246","page_number":84,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"e4c95abd-3853-45fe-ac04-d5bbba46defe","block_type":"box","text":"little financial or accounting information available with respect to issuers located in cer tain emerging market","page_number":85,"box":{"x":70,"y":45,"width":771,"height":11}},{"id":"f51b69d4-bb36-41d8-be93-5918b0cddb89","block_type":"box","text":"countries, and it may be difficult to assess the value or prospects of an investment in such issuers.","page_number":85,"box":{"x":69,"y":60,"width":711,"height":11}},{"id":"1848e23b-1521-4824-b3d9-a2fbdb9f08ca","block_type":"box","text":"The expense ratios of the Funds investing significantly in foreign securities can be expected to be higher than","page_number":85,"box":{"x":101,"y":82,"width":779,"height":12}},{"id":"7c927c55-baee-4c67-b8c7-6bfb589709dc","block_type":"box","text":"those of Funds investing primarily in domestic securities. The costs attributable to investing abroad are usually higher","page_number":85,"box":{"x":68,"y":98,"width":840,"height":11}},{"id":"4e5a3386-d613-40c8-8d81-9024b7a78e4f","block_type":"box","text":"for several reasons, such as the higher cost of custody of foreign securities, higher commissions paid on comparable","page_number":85,"box":{"x":68,"y":113,"width":838,"height":11}},{"id":"8019eae9-74cc-4d66-af60-128ee4adb89f","block_type":"box","text":"transactions on foreign markets and additional costs arising from delays in settlements of transactions involving","page_number":85,"box":{"x":68,"y":128,"width":802,"height":11}},{"id":"246ccc7e-c174-4ef3-b227-e342ad59535d","block_type":"box","text":"foreign securities.","page_number":85,"box":{"x":68,"y":143,"width":127,"height":11}},{"id":"9ce523a9-1ad3-4bd9-abf1-db5d595cfd91","block_type":"box","text":"Risks of Investments in Russia.","page_number":85,"box":{"x":102,"y":166,"width":224,"height":9}},{"id":"cbf605c5-a5a8-4ea8-bca3-041a1a7776b1","block_type":"box","text":"A Fund may invest a por tion of its assets in securities issued by companies","page_number":85,"box":{"x":332,"y":166,"width":539,"height":11}},{"id":"5ba96cec-170f-43ac-ab47-93102fa39242","block_type":"box","text":"located in Russia. The Russian securities market suffers from a variety of problems described above in “Investment","page_number":85,"box":{"x":70,"y":181,"width":826,"height":11}},{"id":"1ac59d87-4c52-4fde-aa2f-c0481ffe51fd","block_type":"box","text":"in Emerging Markets” not encountered in more developed markets. The Russian securities market is relatively new,","page_number":85,"box":{"x":70,"y":196,"width":821,"height":11}},{"id":"82211f59-a925-4ee0-a673-8fc9109ff486","block_type":"box","text":"and a substantial por tion of securities transactions in Russia are privately negotiated outside of stock exchanges.","page_number":85,"box":{"x":69,"y":211,"width":812,"height":11}},{"id":"66fbbb67-a336-405e-ae89-0aa21cecbbeb","block_type":"box","text":"The inexperience of the Russian securities market and the limited volume of trading in securities in the market may","page_number":85,"box":{"x":68,"y":226,"width":824,"height":11}},{"id":"6a0a59c2-9d97-4900-a346-59553b7267f8","block_type":"box","text":"make obtaining accurate prices on por tfolio securities from independent sources more difficult than in more","page_number":85,"box":{"x":69,"y":241,"width":771,"height":11}},{"id":"754adcf4-c33d-42ad-9395-3f6cde1f2500","block_type":"box","text":"developed markets.","page_number":85,"box":{"x":69,"y":257,"width":138,"height":10}},{"id":"d16de177-91c3-4648-b0c6-22f4b1434762","block_type":"box","text":"Because of the underdeveloped state of Russia’s securities markets and banking and telecommunication","page_number":85,"box":{"x":102,"y":279,"width":751,"height":11}},{"id":"061200a4-1c89-483b-ad21-5c59c456d6dc","block_type":"box","text":"systems, settlement, clearing and registration of securities transactions are subject to additional risks. Prior to 2013,","page_number":85,"box":{"x":69,"y":294,"width":839,"height":11}},{"id":"5a659daa-ec9e-4264-8a6a-e76519801d4e","block_type":"box","text":"there was no central registration system for equity share registration in Russia and registration was carried out either","page_number":85,"box":{"x":68,"y":309,"width":838,"height":11}},{"id":"33c661e9-9cbd-4d47-9b1c-2ad6eb30cdb8","block_type":"box","text":"by the issuers themselves or by registrars located throughout Russia. These registrars may not have been subject to","page_number":85,"box":{"x":69,"y":325,"width":831,"height":11}},{"id":"f21699d4-043e-419f-b747-22be75d7f054","block_type":"box","text":"effective state supervision or licensed with any governmental entity. In 2013, Russia established the National","page_number":85,"box":{"x":69,"y":339,"width":783,"height":12}},{"id":"69fb8d8a-00c8-496b-964a-ebb31517e539","block_type":"box","text":"Settlement Depository (“NSD”) as a recognized central securities depository, and title to Russian equities held","page_number":85,"box":{"x":69,"y":355,"width":790,"height":11}},{"id":"23edb587-7c52-42ce-acdf-8ee2bc3f2a34","block_type":"box","text":"through the NSD is now based on the records of the NSD and not on the records of the local registrars. Although the","page_number":85,"box":{"x":68,"y":370,"width":833,"height":11}},{"id":"cf8353a8-3fa7-4539-b822-ed045131fe5c","block_type":"box","text":"implementation of the NSD has enhanced the efficiency and transparency of the Russian securities market, loss still","page_number":85,"box":{"x":70,"y":385,"width":831,"height":11}},{"id":"6deab884-d8fc-4865-bd8d-dd73f1107928","block_type":"box","text":"can occur. Additionally, issuers and registrars remain prominent in the validation and approval of documentation","page_number":85,"box":{"x":69,"y":400,"width":797,"height":11}},{"id":"1ac600fc-e8cc-45c1-9a00-4d29070d2c8f","block_type":"box","text":"requirements for corporate action processing in Russia, and, because the documentation requirements and approval","page_number":85,"box":{"x":69,"y":415,"width":832,"height":11}},{"id":"35b3cd34-6bc0-4470-845b-4760158cf4a1","block_type":"box","text":"criteria vary between registrars and issuers, there remain inconsistent market standards in the Russian market with","page_number":85,"box":{"x":69,"y":430,"width":827,"height":11}},{"id":"31cae015-90ae-474e-81e0-c904e404c9db","block_type":"box","text":"respect to the completion and submission of corporate action elections. To the extent that a Fund suffers a loss","page_number":85,"box":{"x":69,"y":445,"width":800,"height":11}},{"id":"52997dd5-d704-4244-b0c7-c9979dc38b92","block_type":"box","text":"relating to title or corporate actions relating to its por tfolio securities, it may be difficult for the Fund to enforce its","page_number":85,"box":{"x":69,"y":460,"width":813,"height":12}},{"id":"a0a4a240-1037-40db-a594-3e7382264409","block_type":"box","text":"rights or otherwise remedy the loss. Russian securities laws may not recognize foreign nominee accounts held with a","page_number":85,"box":{"x":69,"y":475,"width":836,"height":12}},{"id":"9754f0cb-7493-4bf2-b7ed-e754c9977284","block_type":"box","text":"custodian bank, and as a result the custodian may be considered the ultimate owner of securities held on behalf of","page_number":85,"box":{"x":69,"y":491,"width":824,"height":11}},{"id":"90c2ce28-8d1c-4390-966a-641a7a60d163","block_type":"box","text":"their clients. A Fund also may experience difficulty in obtaining and/or enforcing judgments in Russia.","page_number":85,"box":{"x":68,"y":506,"width":723,"height":11}},{"id":"f16977d8-9882-4431-9f27-944888d7ae57","block_type":"box","text":"In addition, Russia continues to asser t its influence in the region through economic and military measures, as it","page_number":85,"box":{"x":102,"y":528,"width":801,"height":12}},{"id":"1422c2a6-68b3-4cf1-9419-f451930d86d9","block_type":"box","text":"did with Georgia in the summer of 2008 and the Ukraine in 2014 and 2022. Russia launched a large-scale invasion","page_number":85,"box":{"x":69,"y":543,"width":826,"height":12}},{"id":"d3be689a-adf6-4b6f-9230-7a7e33aad711","block_type":"box","text":"of Ukraine on February 24, 2022. The extent and duration of the military action, resulting sanctions and resulting","page_number":85,"box":{"x":69,"y":559,"width":809,"height":11}},{"id":"0802ae1c-497e-491b-ab10-d92cff24a811","block_type":"box","text":"future market disruptions, including declines in its stock markets and the value of the ruble against the U.S. dollar,","page_number":85,"box":{"x":68,"y":574,"width":821,"height":11}},{"id":"865acff4-17f5-4050-be55-591be225b6e5","block_type":"box","text":"are impossible to predict. Any such disruptions caused by Russian military action or other actions (including","page_number":85,"box":{"x":69,"y":589,"width":770,"height":11}},{"id":"1761ea0d-4e63-48cd-8bcd-e3343915de7a","block_type":"box","text":"cyberattacks and espionage) or resulting actual and threatened responses to such activity, including purchasing and","page_number":85,"box":{"x":69,"y":604,"width":827,"height":11}},{"id":"81059c04-16ea-42f3-8e18-4b715557d2ac","block_type":"box","text":"financing restrictions, boycotts or changes in consumer or purchaser preferences, sanctions, tariffs or cyberattacks","page_number":85,"box":{"x":68,"y":619,"width":824,"height":11}},{"id":"0d5d979e-99d2-4001-9edc-bd4358b6eb0a","block_type":"box","text":"on the Russian government, Russian companies or Russian individuals, including politicians, may impact Russia’s","page_number":85,"box":{"x":69,"y":634,"width":814,"height":12}},{"id":"44e11000-d2cb-4a72-9406-90aa90a8eb32","block_type":"box","text":"economy and Russian issuers of securities in which the Fund invests. Actual and threatened responses to such","page_number":85,"box":{"x":69,"y":649,"width":795,"height":12}},{"id":"5ad88d77-a7a2-44e5-acd0-0378e3d9fc9a","block_type":"box","text":"activity, including purchasing restrictions, sanctions, tariffs or cyberattacks on the Russian government or Russian","page_number":85,"box":{"x":69,"y":664,"width":814,"height":12}},{"id":"80527b19-abf0-4822-a672-1624ea051103","block_type":"box","text":"companies, may impact Russia’s economy and Russian issuers of securities in which the Fund invests. Actual and","page_number":85,"box":{"x":69,"y":680,"width":816,"height":11}},{"id":"dc530d16-03f6-4edd-9dc4-a5bf5174e822","block_type":"box","text":"threatened responses to such military action may also impact the markets for cer tain Russian commodities, such as","page_number":85,"box":{"x":68,"y":695,"width":836,"height":11}},{"id":"2014ae9c-48d2-4910-ac49-82e8aaf07a49","block_type":"box","text":"oil and natural gas, as well as other sectors of the Russian economy, and may likely have collateral impacts on such","page_number":85,"box":{"x":69,"y":710,"width":829,"height":11}},{"id":"ebcd946d-776d-46d1-a425-f85195d9c470","block_type":"box","text":"sectors globally.","page_number":85,"box":{"x":69,"y":725,"width":112,"height":11}},{"id":"34589e7f-a203-4a20-9357-5d469c36c07f","block_type":"box","text":"Governments in the United States and many other countries (collectively, the “Sanctioning Bodies”) have","page_number":85,"box":{"x":102,"y":748,"width":745,"height":11}},{"id":"8234afeb-7136-4ba6-8592-9a53026efb2e","block_type":"box","text":"imposed economic sanctions, which can consist of prohibiting cer tain securities trades, cer tain private transactions","page_number":85,"box":{"x":70,"y":763,"width":826,"height":11}},{"id":"06ee2219-3297-4486-b2bc-7375a7cb8445","block_type":"box","text":"in the energy sector, asset freezes and prohibition of all business, against cer tain Russian individuals, including","page_number":85,"box":{"x":70,"y":778,"width":799,"height":11}},{"id":"2deb29a0-9231-412d-bba8-3a50053df3e6","block_type":"box","text":"politicians, and Russian corporate and banking entities. The Sanctioning Bodies, or others, could also institute","page_number":85,"box":{"x":70,"y":793,"width":788,"height":11}},{"id":"d1b6036f-cfca-4648-aee2-57c7f29c05e9","block_type":"box","text":"broader sanctions on Russia, including banning Russia from global payments systems that facilitate cross-border","page_number":85,"box":{"x":69,"y":808,"width":807,"height":11}},{"id":"6f3286e4-e16e-475a-8d61-0951cc17d006","block_type":"box","text":"payments. These sanctions, or even the threat of fur ther sanctions, may result in the decline of the value and","page_number":85,"box":{"x":70,"y":823,"width":782,"height":11}},{"id":"9944f361-9b6c-4bd3-90a5-5a5b49117bfa","block_type":"box","text":"liquidity of Russian securities, a weakening of the ruble or other adverse consequences to the Russian economy.","page_number":85,"box":{"x":70,"y":838,"width":802,"height":12}},{"id":"34319993-d890-4bba-8270-b66280762bc4","block_type":"box","text":"These sanctions have resulted and may continue to result in the immediate freeze of Russian securities and/or","page_number":85,"box":{"x":68,"y":853,"width":797,"height":12}},{"id":"6269c049-077b-4515-9560-3de6b991630e","block_type":"box","text":"funds invested in prohibited assets, impairing the ability of a Fund to buy, sell, receive or deliver those securities","page_number":85,"box":{"x":68,"y":869,"width":804,"height":11}},{"id":"19ff1b50-9e36-4ad5-afd1-e8429ebd0bca","block_type":"box","text":"and/or assets. Sanctions could also result in Russia taking counter measures or retaliatory actions which may","page_number":85,"box":{"x":69,"y":884,"width":791,"height":11}},{"id":"ee06a203-5df5-43ae-a9ed-a24b105cb942","block_type":"box","text":"fur ther impair the value and liquidity of Russian securities.","page_number":85,"box":{"x":68,"y":899,"width":417,"height":11}},{"id":"90ee99de-d37a-45c1-a0bf-805f3451a0ed","block_type":"box","text":"II-38","page_number":85,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"6420f4e1-e9e7-4b35-a860-f0115ef032f3","block_type":"box","text":"NM1026U-6033063-85/246","page_number":85,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"43d7df53-8817-4cab-8c5a-2c85b66fc126","block_type":"box","text":"Risks of Investing in Saudi Arabia.","page_number":86,"box":{"x":102,"y":45,"width":241,"height":11}},{"id":"2a6e2322-e78d-487e-951b-e29e3a093976","block_type":"box","text":"The ability of foreign investors (such as a Fund) to invest in Saudi Arabian","page_number":86,"box":{"x":350,"y":45,"width":523,"height":11}},{"id":"fc260767-b870-4d01-9f3a-ded37f7093a7","block_type":"box","text":"issuers is new and untested. Such ability could be restricted or revoked by the Saudi Arabian government at any time,","page_number":86,"box":{"x":70,"y":60,"width":838,"height":11}},{"id":"ff50a61b-3a78-494e-a828-844ad5e8e5d2","block_type":"box","text":"and unforeseen risks could materialize due to foreign ownership in such securities. In addition, the Capital Market","page_number":86,"box":{"x":69,"y":75,"width":814,"height":11}},{"id":"f216982f-e700-4827-8c3f-a47ec4793904","block_type":"box","text":"Authority (“CMA”) places investment limitations on the ownership of Saudi Arabian issuers by foreign investors,","page_number":86,"box":{"x":68,"y":90,"width":793,"height":11}},{"id":"5e1897e6-4dbc-4359-a146-77689b0e1f1e","block_type":"box","text":"including a limitation on a Fund’s ownership of any single issuer listed on the Saudi Arabian Stock Exchange, which","page_number":86,"box":{"x":70,"y":105,"width":819,"height":11}},{"id":"fe17ebbc-2a89-4056-b6ec-4d44f6031a4e","block_type":"box","text":"may prevent a Fund from investing in accordance with its strategy and contribute to tracking error against the","page_number":86,"box":{"x":69,"y":120,"width":777,"height":12}},{"id":"9804282f-c61f-4768-93d5-b509e003578a","block_type":"box","text":"Underlying Index. These restrictions may be changed or new restrictions, such as licensing requirements, special","page_number":86,"box":{"x":70,"y":136,"width":803,"height":11}},{"id":"fa1d61a4-e307-4a38-b831-60c505be802d","block_type":"box","text":"approvals or additional foreign taxes, may be instituted at any time. A Fund may not be able to obtain or maintain any","page_number":86,"box":{"x":69,"y":150,"width":837,"height":12}},{"id":"fafc4e83-8423-4f4c-b6f8-7fb2b81ef564","block_type":"box","text":"such licenses or approvals and may not be able to buy and sell securities at full value. Major disruptions or","page_number":86,"box":{"x":69,"y":166,"width":765,"height":11}},{"id":"92b96d92-7fb3-4a83-8da1-2008945bc00c","block_type":"box","text":"regulatory changes could occur in the Saudi Arabian market, any of which could negatively impact a Fund. These risks","page_number":86,"box":{"x":69,"y":181,"width":838,"height":11}},{"id":"d91f6c46-3032-4e81-aed8-73ee7ab7b376","block_type":"box","text":"may be exacerbated, compared to more developed markets, given the limited history of foreign investment in the","page_number":86,"box":{"x":69,"y":196,"width":805,"height":11}},{"id":"a2e9129e-ed38-4e88-9251-df98c72950b4","block_type":"box","text":"Saudi Arabian market. Investments in Saudi Arabia may also be subject to loss due to expropriation or nationalization","page_number":86,"box":{"x":69,"y":211,"width":837,"height":11}},{"id":"f3a9b655-3efc-496b-9e60-ef65813ce7d3","block_type":"box","text":"of assets and proper ty or the imposition of restrictions on additional foreign investments and repatriation of capital.","page_number":86,"box":{"x":69,"y":226,"width":826,"height":11}},{"id":"49f943f6-40a5-4b9e-aa52-f8ac3f04f2f8","block_type":"box","text":"Such heightened risks may include, among others, restrictions on and government intervention in international trade,","page_number":86,"box":{"x":69,"y":241,"width":834,"height":11}},{"id":"34ec86da-b5ca-49fc-b250-105c45e65696","block_type":"box","text":"confiscatory taxation, political instability, including authoritarian and/or military involvement in governmental decision","page_number":86,"box":{"x":69,"y":256,"width":835,"height":12}},{"id":"000a1e18-734d-40c7-95b8-c886d1941890","block_type":"box","text":"making, armed conflict, crime and instability as a result of religious, ethnic and/or socioeconomic unrest. Saudi","page_number":86,"box":{"x":69,"y":271,"width":797,"height":12}},{"id":"aa13adef-5d4d-45de-95b7-06f8c816aadd","block_type":"box","text":"Arabia has privatized, or has begun the process of privatizing, cer tain entities and industries. Newly privatized","page_number":86,"box":{"x":68,"y":286,"width":781,"height":12}},{"id":"c32dbe4b-e638-40e2-a313-36dfb434f59f","block_type":"box","text":"companies may face strong competition from government-sponsored competitors that have not been privatized. In","page_number":86,"box":{"x":69,"y":302,"width":811,"height":11}},{"id":"d3e28c22-24ba-41ef-8d46-a279621fd2b1","block_type":"box","text":"some instances, investors in newly privatized entities have suffered losses due to the inability of the newly privatized","page_number":86,"box":{"x":69,"y":317,"width":833,"height":11}},{"id":"02003a64-60c4-40dc-a0cd-5b90089e2946","block_type":"box","text":"entities to adjust quickly to a competitive environment or changing regulatory and legal standards or, in some cases,","page_number":86,"box":{"x":69,"y":332,"width":831,"height":11}},{"id":"b8af5f56-b53f-43ff-b4f3-4f4877aa851e","block_type":"box","text":"due to re-nationalization of such privatized entities. There is no assurance that similar losses will not recur. Fur ther,","page_number":86,"box":{"x":69,"y":347,"width":823,"height":11}},{"id":"05abc73e-6a90-4bb3-ba08-7970324b6cc9","block_type":"box","text":"under income tax laws imposed by the Depar tment of Zakat and Income Tax, dividends paid by a Saudi Arabian","page_number":86,"box":{"x":69,"y":362,"width":791,"height":11}},{"id":"b4618591-9f90-4a72-bba7-f724915e8803","block_type":"box","text":"company to foreign stockholders are generally subject to a 5% withholding tax (different tax rates may apply pursuant","page_number":86,"box":{"x":69,"y":377,"width":835,"height":12}},{"id":"4e0d36b8-ed9e-48fc-a9b9-24c25b93d822","block_type":"box","text":"to an applicable treaty). Saudi Arabia is highly reliant on income from the sale of petroleum and trade with other","page_number":86,"box":{"x":68,"y":392,"width":799,"height":12}},{"id":"21908dd3-ede2-4f70-a994-9e04d927265a","block_type":"box","text":"countries involved in the sale of petroleum, and its economy is therefore vulnerable to changes in foreign currency","page_number":86,"box":{"x":69,"y":407,"width":815,"height":12}},{"id":"a6297f95-a6f4-4e90-9c01-6b50f9111f73","block_type":"box","text":"values and the market for petroleum. As global demand for petroleum fluctuates, Saudi Arabia may be significantly","page_number":86,"box":{"x":68,"y":423,"width":818,"height":11}},{"id":"4ac7ad00-e0da-422f-9f2d-1679f2578390","block_type":"box","text":"impacted.","page_number":86,"box":{"x":70,"y":438,"width":67,"height":11}},{"id":"ba27a8da-52df-4e45-be90-de9f382c4005","block_type":"box","text":"Like most Middle Eastern governments, the government of Saudi Arabia exercises substantial influence over","page_number":86,"box":{"x":102,"y":460,"width":773,"height":12}},{"id":"2553bc1c-2547-4ca7-9795-b06b3a6b552d","block_type":"box","text":"many aspects of the private sector. Although liberalization in the wider economy is underway, in many areas it has","page_number":86,"box":{"x":69,"y":475,"width":812,"height":12}},{"id":"e3153cde-f4d6-4075-9d4d-23c854ab0b13","block_type":"box","text":"lagged significantly: restrictions on foreign ownership persist, and the government has an ownership stake in many","page_number":86,"box":{"x":70,"y":491,"width":818,"height":11}},{"id":"e6c880ca-9f2a-4b06-af84-fb509d929de1","block_type":"box","text":"key industries. The situation is exacerbated by the fact that Saudi Arabia is governed by an absolute monarchy. Saudi","page_number":86,"box":{"x":69,"y":506,"width":836,"height":11}},{"id":"687d628f-4715-445f-bbd0-e9eeb79f1120","block_type":"box","text":"Arabia has historically experienced strained relations with economic par tners worldwide, including other countries in","page_number":86,"box":{"x":68,"y":521,"width":826,"height":11}},{"id":"cb9a2956-94b0-4ab8-bf2b-1ccae069ba79","block_type":"box","text":"the Middle East due to geopolitical events. Incidents involving a Middle Eastern country’s or the region’s security,","page_number":86,"box":{"x":68,"y":536,"width":809,"height":11}},{"id":"34b9418f-8a6b-4ed4-ba01-f8521d819624","block_type":"box","text":"including terrorism, may cause uncer tainty in their markets and may adversely affect its economy and a Fund’s","page_number":86,"box":{"x":70,"y":551,"width":790,"height":11}},{"id":"e1db3f21-0645-40b0-838b-9cdfc747ec55","block_type":"box","text":"investments. Governmental actions in the future could have a significant effect on economic conditions in Saudi","page_number":86,"box":{"x":70,"y":566,"width":798,"height":11}},{"id":"ce555d3d-0bb0-4e63-a489-83e92a0fada6","block_type":"box","text":"Arabia, which could affect private sector companies and a Fund, as well as the value of securities in a Fund’s","page_number":86,"box":{"x":68,"y":581,"width":781,"height":11}},{"id":"776285db-6d58-436e-a82d-71aeb4932b0a","block_type":"box","text":"por tfolio. Any economic sanctions on Saudi Arabian individuals or Saudi Arabian corporate entities, or even the threat","page_number":86,"box":{"x":70,"y":596,"width":836,"height":12}},{"id":"3dce1f4a-9eaa-4c74-acc1-7801e65ec708","block_type":"box","text":"of sanctions, may result in the decline of the value and liquidity of Saudi Arabian securities, a weakening of the Saudi","page_number":86,"box":{"x":69,"y":612,"width":837,"height":11}},{"id":"f773a435-72ba-4046-9880-ce2f0a8088c0","block_type":"box","text":"riyal or other adverse consequences to the Saudi Arabian economy. In addition, Saudi Arabia’s economy relies heavily","page_number":86,"box":{"x":69,"y":627,"width":838,"height":11}},{"id":"d59bbff9-85f0-4136-944a-e4c4bbff6e19","block_type":"box","text":"on cheap, foreign labor, and changes in the availability of this labor supply could have an adverse effect on the","page_number":86,"box":{"x":69,"y":642,"width":790,"height":11}},{"id":"f1851636-20c5-46fc-9079-2b013054a408","block_type":"box","text":"economy.","page_number":86,"box":{"x":69,"y":659,"width":65,"height":9}},{"id":"52eb597b-199d-47c5-907a-fcfd5e8e4045","block_type":"box","text":"The securities markets in Saudi Arabia may not be as developed as those in other countries. As a result,","page_number":86,"box":{"x":101,"y":680,"width":747,"height":11}},{"id":"2be3cfc5-4f56-4b75-a71e-75936b6e55e2","block_type":"box","text":"securities markets in Saudi Arabia are subject to greater risks associated with market volatility, lower market","page_number":86,"box":{"x":69,"y":695,"width":776,"height":11}},{"id":"1529bc40-9472-4e65-9c53-b67f8146f75e","block_type":"box","text":"capitalization, lower trading volume, illiquidity, inflation, greater price fluctuations, uncer tainty regarding the existence","page_number":86,"box":{"x":69,"y":710,"width":836,"height":11}},{"id":"8c08633c-ed87-474c-8f6c-b7a055c41ae6","block_type":"box","text":"of trading markets, governmental control and heavy regulation of labor and industry. Shares of cer tain Saudi Arabian","page_number":86,"box":{"x":69,"y":725,"width":830,"height":11}},{"id":"7ca0c8ee-8fcd-4214-8141-b3fb41f716b0","block_type":"box","text":"companies tend to trade less frequently than those of companies on exchanges in more developed markets. Such","page_number":86,"box":{"x":69,"y":740,"width":813,"height":11}},{"id":"ad8e2180-0809-41cd-bcee-9156de3e1d21","block_type":"box","text":"infrequent trading may adversely affect the pricing of these securities and a Fund’s ability to sell these securities in","page_number":86,"box":{"x":70,"y":755,"width":822,"height":11}},{"id":"12a52ede-f701-43f1-acc5-bdb781d1b4c4","block_type":"box","text":"the future. Current regulations in Saudi Arabian markets may require a Fund to execute trades of securities through a","page_number":86,"box":{"x":68,"y":770,"width":837,"height":12}},{"id":"96c4bd49-28b3-498d-9204-397be076785f","block_type":"box","text":"single broker. As a result, the Manager will have less flexibility to choose among brokers on behalf of a Fund than is","page_number":86,"box":{"x":69,"y":785,"width":826,"height":12}},{"id":"985db5a6-525c-4d69-ac03-5e88010c77cf","block_type":"box","text":"typically the case for investment managers.","page_number":86,"box":{"x":68,"y":801,"width":309,"height":11}},{"id":"cab69990-2df9-4cec-af48-030a105aedba","block_type":"box","text":"Although the political situation in Saudi Arabia is largely stable, Saudi Arabia has historically experienced political","page_number":86,"box":{"x":101,"y":823,"width":806,"height":12}},{"id":"adf2f72b-5e11-415b-9082-5470f3090b50","block_type":"box","text":"instability, and there remains the possibility that the stability will not hold in the future or that instability in the larger","page_number":86,"box":{"x":70,"y":838,"width":828,"height":12}},{"id":"c2b4ae1d-7cc2-46ab-be4c-ad9ed5686280","block_type":"box","text":"Middle East region could adversely impact the economy of Saudi Arabia. Instability may be caused by military","page_number":86,"box":{"x":70,"y":853,"width":777,"height":12}},{"id":"170987f3-816a-486e-94b8-ffaf29177392","block_type":"box","text":"developments, government interventions in the marketplace, terrorism, extremist attitudes, attempted social or","page_number":86,"box":{"x":69,"y":869,"width":796,"height":11}},{"id":"15a75b54-f986-43ad-99b8-4d24d1c8b4a5","block_type":"box","text":"political reforms, religious differences, or other factors. Additionally, anti-Western views held by cer tain groups in the","page_number":86,"box":{"x":70,"y":884,"width":830,"height":11}},{"id":"ec96ba64-0fee-40b3-adda-deb7607ce8a8","block_type":"box","text":"Middle East may influence government policies regarding foreign investment. Fur ther developments in U.S. relations","page_number":86,"box":{"x":70,"y":899,"width":827,"height":11}},{"id":"750ef69c-f5b1-4495-98a0-63d4301de62f","block_type":"box","text":"II-39","page_number":86,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"9b722235-8b1d-4c4d-a939-f941112fd11e","block_type":"box","text":"NM1026U-6033063-86/246","page_number":86,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"435f256d-5504-44f3-a567-cf6596da8bbe","block_type":"box","text":"with Saudi Arabia and other Middle-Eastern countries may affect these attitudes and policies. The U.S. is a","page_number":87,"box":{"x":68,"y":45,"width":764,"height":11}},{"id":"a5fd6cd2-151a-48ee-bde1-ac2509cc51b0","block_type":"box","text":"significant, and in some cases the most significant, trading par tner of, or foreign investor in, Saudi Arabia. As a","page_number":87,"box":{"x":69,"y":60,"width":795,"height":11}},{"id":"812387bd-fd5a-402e-a560-d41edbe36501","block_type":"box","text":"result, economic conditions of Saudi Arabia may be par ticularly affected by changes in the U.S. economy. A decrease","page_number":87,"box":{"x":69,"y":75,"width":835,"height":11}},{"id":"b671e36e-0f88-4a94-a3dc-2d5bbdc073d9","block_type":"box","text":"in U.S. impor ts or expor ts, new trade and financial regulations or tariffs, changes in the U.S. dollar exchange rate or","page_number":87,"box":{"x":70,"y":90,"width":829,"height":11}},{"id":"9b131a0a-e45a-4e98-9368-9b3375576d61","block_type":"box","text":"an economic slowdown in the U.S. may have a material adverse effect on the economic conditions of Saudi Arabia","page_number":87,"box":{"x":69,"y":105,"width":815,"height":11}},{"id":"cf70e07e-fab9-4c2b-95ed-230f0da0ac2d","block_type":"box","text":"and, as a result, securities to which the Fund has exposure. Political instability in Nor th Africa and the larger Middle","page_number":87,"box":{"x":69,"y":120,"width":825,"height":12}},{"id":"fa1dad12-688e-4ebe-b4dd-f8d9609ce2d8","block_type":"box","text":"East region has caused significant disruptions to many industries. Continued political and social unrest in these","page_number":87,"box":{"x":70,"y":135,"width":797,"height":12}},{"id":"d646a915-f1b3-423d-a5e5-3a286348a094","block_type":"box","text":"areas may negatively affect the value of securities in a Fund’s por tfolio.","page_number":87,"box":{"x":69,"y":150,"width":510,"height":12}},{"id":"4bb27f45-fca1-45bf-9e65-9c51acaa6464","block_type":"box","text":"Cer tain issuers located in Saudi Arabia may operate in, or have dealings with, countries subject to sanctions","page_number":87,"box":{"x":102,"y":173,"width":773,"height":11}},{"id":"b272403b-db42-4dbd-a17f-22947a4eec11","block_type":"box","text":"and/or embargoes imposed by the U.S. Government and the United Nations and/or countries identified by the U.S.","page_number":87,"box":{"x":69,"y":188,"width":820,"height":12}},{"id":"bc3c1aef-c8dd-421e-962d-c4bbb5227cea","block_type":"box","text":"Government as state sponsors of terrorism. As a result, an issuer may sustain damage to its reputation if it is","page_number":87,"box":{"x":69,"y":203,"width":787,"height":12}},{"id":"dad90525-ff74-425a-ba81-f3a21470d0bb","block_type":"box","text":"identified as an issuer which operates in, or has dealings with, such countries. A Fund, as an investor in such issuers","page_number":87,"box":{"x":70,"y":218,"width":837,"height":12}},{"id":"5877bfb4-bf52-4960-85e1-cd102fd53cf6","block_type":"box","text":"will be indirectly subject to those risks.","page_number":87,"box":{"x":68,"y":234,"width":277,"height":11}},{"id":"8a3c55b3-7a24-4e37-b9b5-4f014a639de2","block_type":"box","text":"Risks of Investing in Venezuela.","page_number":87,"box":{"x":102,"y":256,"width":223,"height":12}},{"id":"280eda6f-74ed-439f-b375-fbbbc876aca6","block_type":"box","text":"Investment in Venezuela may subject a Fund to legal, regulatory, political,","page_number":87,"box":{"x":332,"y":257,"width":521,"height":11}},{"id":"b6a1bd2e-fad6-4022-bda8-ff0b92bbab3e","block_type":"box","text":"currency, security, expropriation and/or nationalization of assets and economic risk specific to Venezuela. Venezuela","page_number":87,"box":{"x":69,"y":271,"width":829,"height":12}},{"id":"a7df55a0-aa30-4150-984c-667a95600119","block_type":"box","text":"is extremely well endowed with natural resources, including oil and natural gas, and its economy is heavily dependent","page_number":87,"box":{"x":70,"y":287,"width":837,"height":11}},{"id":"33a177bf-0f8f-404b-908a-ace2f6dde8b1","block_type":"box","text":"on expor t of natural resources to key trading par tners. Any act of terrorism, an armed conflict or a breakdown of a","page_number":87,"box":{"x":69,"y":302,"width":813,"height":11}},{"id":"124323c1-e0f6-4cd0-b754-2b971ad83f5b","block_type":"box","text":"key trading relationship that disrupts the production or expor t of natural resources will likely negatively affect the","page_number":87,"box":{"x":69,"y":317,"width":804,"height":11}},{"id":"3874d1ca-ecf6-4670-9076-0f8267b6aa97","block_type":"box","text":"Venezuelan economy. The government continues to control key sectors of the economy, including upstream oil and","page_number":87,"box":{"x":68,"y":332,"width":816,"height":11}},{"id":"e6c158b8-6513-4493-9b2e-7195ade0ad94","block_type":"box","text":"gas production, and has sought to increase its role in key sectors, such as telecommunications and steel.","page_number":87,"box":{"x":68,"y":347,"width":758,"height":11}},{"id":"3535a8c6-aa58-4719-9f4f-d37c9a3e591a","block_type":"box","text":"Meanwhile, ambiguities in the investment environment remain, such as continued high levels of bureaucracy and","page_number":87,"box":{"x":70,"y":362,"width":803,"height":11}},{"id":"683d360e-4aa6-4df9-abcd-0f22cb1cba9a","block_type":"box","text":"corruption, large macroeconomic imbalances, and political and policy uncer tainty. Friction continues between the","page_number":87,"box":{"x":69,"y":377,"width":804,"height":12}},{"id":"53a02b06-e297-499e-ba0b-c1be741036b1","block_type":"box","text":"governments of the U.S. and Venezuela. The U.S. has imposed economic sanctions, which consist of asset freezes","page_number":87,"box":{"x":68,"y":392,"width":822,"height":12}},{"id":"20357089-9195-456b-997a-cc3d13e7b949","block_type":"box","text":"and sectoral sanctions, on cer tain Venezuelan individuals and Venezuelan corporate entities, and on the Venezuelan","page_number":87,"box":{"x":69,"y":408,"width":827,"height":10}},{"id":"05e5b7a8-b4d7-4886-a07c-e961e5878fa7","block_type":"box","text":"government. The U.S. could also institute broader sanctions on Venezuela. The U.S. has also taken military action","page_number":87,"box":{"x":68,"y":423,"width":814,"height":11}},{"id":"7442d1e2-4518-4cc0-b2a2-353269521194","block_type":"box","text":"against Venezuela in an effor t to effect regime change. Military action, sanctions, or even the threat of fur ther","page_number":87,"box":{"x":69,"y":438,"width":787,"height":11}},{"id":"27f5cf2e-28bd-499f-ba71-2c6f572b531a","block_type":"box","text":"military action and sanctions, may result in the decline of the value and liquidity of Venezuelan securities, a","page_number":87,"box":{"x":69,"y":453,"width":766,"height":11}},{"id":"618279c7-1ee3-4927-99b7-bfe1c5b23fc6","block_type":"box","text":"weakening of the bolivar or other adverse consequences to the Venezuelan economy. These sanctions impair the","page_number":87,"box":{"x":68,"y":468,"width":804,"height":11}},{"id":"01f44b29-ebda-4ee4-98c2-006de3a13f88","block_type":"box","text":"ability of a Fund to buy, sell, receive or deliver those securities and/or assets. Additional sanctions against Venezuela","page_number":87,"box":{"x":69,"y":483,"width":838,"height":11}},{"id":"1976ce41-39d6-4f20-955f-4d126bc6a353","block_type":"box","text":"may in the future be imposed by the U.S. or other countries. These factors, among others, can have a negative","page_number":87,"box":{"x":69,"y":498,"width":790,"height":11}},{"id":"48bff517-3af8-4232-8935-49d1177a7930","block_type":"box","text":"impact on a Fund’s investments.","page_number":87,"box":{"x":70,"y":514,"width":230,"height":10}},{"id":"23098419-a892-4397-8c42-b5141f81112e","block_type":"box","text":"Brady Bonds.","page_number":87,"box":{"x":102,"y":536,"width":92,"height":11}},{"id":"7282c990-5e8f-4b5b-bb10-2295e23ee4b5","block_type":"box","text":"Cer tain Funds may invest in Brady Bonds. A Fund’s emerging market debt securities may include","page_number":87,"box":{"x":201,"y":536,"width":689,"height":11}},{"id":"6b48e5e7-2df5-4536-800f-2a0e08591d00","block_type":"box","text":"emerging market governmental debt obligations commonly referred to as Brady Bonds. Brady Bonds are securities","page_number":87,"box":{"x":69,"y":551,"width":815,"height":11}},{"id":"d09c6652-684e-4268-934a-35e75397a35e","block_type":"box","text":"created through the exchange of existing commercial bank loans to sovereign entities for new obligations in","page_number":87,"box":{"x":69,"y":566,"width":766,"height":11}},{"id":"d683fc63-4a68-4584-8140-9a47cd524bfb","block_type":"box","text":"connection with debt restructurings under a debt restructuring plan introduced by former U.S. Secretary of the","page_number":87,"box":{"x":69,"y":581,"width":784,"height":12}},{"id":"1a523aa6-1f01-481c-a7ae-6c514227f97f","block_type":"box","text":"Treasury, Nicholas F. Brady (the “Brady Plan”). Brady Plan debt restructurings have been implemented in a number of","page_number":87,"box":{"x":68,"y":596,"width":837,"height":12}},{"id":"ec864390-07e7-4da7-a89c-32eb2d1b2a1a","block_type":"box","text":"countries, including: Argentina, Bolivia, Brazil, Bulgaria, Costa Rica, the Dominican Republic, Ecuador, Jordan, Mexico,","page_number":87,"box":{"x":69,"y":612,"width":839,"height":11}},{"id":"93e28ffc-5920-4914-87e1-0addbf9bef47","block_type":"box","text":"Niger, Nigeria, Panama, Peru, the Philippines, Poland, Uruguay, Venezuela, and Vietnam. Beginning in the early","page_number":87,"box":{"x":70,"y":627,"width":786,"height":11}},{"id":"4b5deb14-8763-452d-b347-c5993138ddcf","block_type":"box","text":"2000s, cer tain countries began retiring their Brady Bonds, including Brazil, Colombia, Mexico, the Philippines, and","page_number":87,"box":{"x":69,"y":642,"width":814,"height":11}},{"id":"7af386be-0b26-4341-9360-962bbec4d5c1","block_type":"box","text":"Venezuela.","page_number":87,"box":{"x":68,"y":657,"width":75,"height":9}},{"id":"e1a7171c-0e20-4172-a01b-95e8717cd7f8","block_type":"box","text":"Brady Bonds may be collateralized or uncollateralized, are issued in various currencies (primarily the U.S. dollar)","page_number":87,"box":{"x":102,"y":680,"width":798,"height":11}},{"id":"ea19e741-331d-49e4-927f-903f164a7f8b","block_type":"box","text":"and are actively traded in the OTC secondary market. Brady Bonds are not considered to be U.S. Government","page_number":87,"box":{"x":69,"y":695,"width":780,"height":11}},{"id":"e2d60f65-ddde-4143-bb70-61e2441e3ca8","block_type":"box","text":"Securities. U.S. dollar-denominated, collateralized Brady Bonds, which may be fixed rate par bonds or floating rate","page_number":87,"box":{"x":69,"y":710,"width":812,"height":11}},{"id":"c892f3f5-1f0c-44d9-a22a-62a93ccdbc6e","block_type":"box","text":"discount bonds, are generally collateralized in full as to principal by U.S. Treasury zero-coupon bonds having the","page_number":87,"box":{"x":69,"y":725,"width":796,"height":11}},{"id":"726705c7-f03d-4f71-86ea-e24347901b1f","block_type":"box","text":"same maturity as the Brady Bonds. Interest payments on these Brady Bonds generally are collateralized on a one","page_number":87,"box":{"x":69,"y":740,"width":812,"height":11}},{"id":"7a483e0d-194f-4fc5-88f5-9139f79b453e","block_type":"box","text":"year or longer rolling-forward basis by cash or securities in an amount that, in the case of fixed rate bonds, is equal","page_number":87,"box":{"x":68,"y":755,"width":823,"height":11}},{"id":"b8ba36a0-44c4-4299-abde-7a4b54f1cd7c","block_type":"box","text":"to at least one year of interest payments or, in the case of floating rate bonds, initially is equal to at least one year’s","page_number":87,"box":{"x":68,"y":770,"width":833,"height":12}},{"id":"cca58d20-8196-440d-a1b3-e947ea4934c5","block_type":"box","text":"interest payments based on the applicable interest rate at that time and is adjusted at regular intervals thereafter.","page_number":87,"box":{"x":70,"y":785,"width":816,"height":12}},{"id":"c95bd292-9988-4c9b-96e0-b52dcc47a4b3","block_type":"box","text":"Cer tain Brady Bonds are entitled to “value recovery payments” in cer tain circumstances, which in effect constitute","page_number":87,"box":{"x":69,"y":801,"width":818,"height":11}},{"id":"0676192e-ce09-4019-84e9-4e70ee195abd","block_type":"box","text":"supplemental interest payments but generally are not collateralized. Brady Bonds are often viewed as having three or","page_number":87,"box":{"x":69,"y":816,"width":835,"height":11}},{"id":"8e6bee69-7349-45c9-99dc-bcadda4ed5ac","block_type":"box","text":"four valuation components: (i) the collateralized repayment of principal at final maturity; (ii) the collateralized interest","page_number":87,"box":{"x":68,"y":831,"width":832,"height":11}},{"id":"ea489ca9-598a-4f99-b718-8ad83e96e381","block_type":"box","text":"payments; (iii) the uncollateralized interest payments; and (iv) any uncollateralized repayment of principal at maturity","page_number":87,"box":{"x":70,"y":846,"width":828,"height":11}},{"id":"d0a69b76-b555-43d0-8b0f-34c3787211aa","block_type":"box","text":"(the uncollateralized amounts constitute the “residual risk”).","page_number":87,"box":{"x":69,"y":861,"width":430,"height":11}},{"id":"12170c13-95af-410e-82b0-c384b7f3e81e","block_type":"box","text":"Brady Bonds involve various risk factors described above associated with investing in foreign securities, including","page_number":87,"box":{"x":102,"y":884,"width":807,"height":11}},{"id":"789f0fbb-74c1-4256-9ba3-63b2265c6079","block_type":"box","text":"the history of defaults with respect to commercial bank loans by public and private entities of countries issuing Brady","page_number":87,"box":{"x":68,"y":899,"width":838,"height":11}},{"id":"c864a27b-c124-4542-93fd-87515264a399","block_type":"box","text":"II-40","page_number":87,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"4865b609-90be-4699-a345-fd1a39ce505b","block_type":"box","text":"NM1026U-6033063-87/246","page_number":87,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"36a468e6-4655-43d1-a2b3-6787475986a2","block_type":"box","text":"Bonds. In light of the residual risk of Brady Bonds and, among other factors, the history of defaults, investments in","page_number":88,"box":{"x":70,"y":45,"width":819,"height":11}},{"id":"5b1e0799-bd78-487e-b745-19839567b942","block_type":"box","text":"Brady Bonds are considered speculative. There can be no assurance that Brady Bonds in which the Funds may invest","page_number":88,"box":{"x":70,"y":60,"width":835,"height":11}},{"id":"650ab6c3-544f-4e8f-843f-961e19a050dc","block_type":"box","text":"will not be subject to restructuring arrangements or to requests for new credit, which may cause the Funds to suffer a","page_number":88,"box":{"x":68,"y":75,"width":841,"height":11}},{"id":"275b25cc-9e5a-46a7-b144-dca7db9dd7bd","block_type":"box","text":"loss of interest or principal on any of its holdings.","page_number":88,"box":{"x":70,"y":90,"width":351,"height":11}},{"id":"51e60789-975a-40e8-a0e2-ef13315e801a","block_type":"box","text":"China Investments Risk.","page_number":88,"box":{"x":102,"y":113,"width":171,"height":9}},{"id":"3eb72aa4-8b0d-455f-86a0-2f90f20eb0bb","block_type":"box","text":"Investments in securities of companies domiciled in the People’s Republic of China (“China” or the “PRC”),","page_number":88,"box":{"x":102,"y":135,"width":763,"height":11}},{"id":"3d9b0659-c64a-42cd-8041-2a71375d42e6","block_type":"box","text":"including cer tain Hong Kong-listed and U.S.-listed securities, involve a high degree of risk and special considerations","page_number":88,"box":{"x":70,"y":150,"width":830,"height":12}},{"id":"67832243-4ba7-4ba0-b393-2901b8038e0a","block_type":"box","text":"not typically associated with investing in the U.S. securities markets. Such heightened risks include, among others,","page_number":88,"box":{"x":69,"y":166,"width":821,"height":11}},{"id":"4b5e58a1-a2cc-4589-8757-dbcfff67bf10","block_type":"box","text":"an authoritarian government, popular unrest associated with demands for improved political, economic and social","page_number":88,"box":{"x":69,"y":181,"width":809,"height":11}},{"id":"f85b915c-378d-439a-957e-e7659dfc0cc6","block_type":"box","text":"conditions, the impact of regional conflict on the economy and hostile relations with other countries.","page_number":88,"box":{"x":69,"y":196,"width":713,"height":11}},{"id":"6b189495-84ae-456c-a8e9-716ab26481bc","block_type":"box","text":"Military conflicts, either in response to internal social unrest or conflicts with other countries, could disrupt","page_number":88,"box":{"x":102,"y":218,"width":762,"height":12}},{"id":"a508e88c-0eec-411b-9829-249b6fe5d4c1","block_type":"box","text":"economic development. The Chinese economy is vulnerable to the long-running disagreements and religious and","page_number":88,"box":{"x":69,"y":234,"width":800,"height":11}},{"id":"15bb8077-4b2b-4eb4-b91e-8c770c4494da","block_type":"box","text":"nationalist disputes with Tibet and the Xinjiang region. Since 1997, there have been tensions between the Chinese","page_number":88,"box":{"x":69,"y":249,"width":820,"height":11}},{"id":"a8aa08d3-a744-4321-8da9-a69d940baab9","block_type":"box","text":"government and many people in Hong Kong who perceive China as tightening control over Hong Kong’s semi","page_number":88,"box":{"x":68,"y":264,"width":777,"height":11}},{"id":"669c876a-724f-47eb-8f61-1eac1c17f986","block_type":"box","text":"autonomous liberal political, economic, legal, and social framework. Protests and unrest have increased tensions","page_number":88,"box":{"x":69,"y":279,"width":809,"height":11}},{"id":"ee44e2a0-8d44-4aef-b45c-a559de90bf4d","block_type":"box","text":"even fur ther. Due to the interconnected nature of the Hong Kong and Chinese economies, this instability in Hong","page_number":88,"box":{"x":69,"y":294,"width":805,"height":11}},{"id":"92baabb9-230e-4fec-9de9-3afde3096000","block_type":"box","text":"Kong may cause uncer tainty in the Hong Kong and Chinese markets. China has a complex territorial dispute","page_number":88,"box":{"x":70,"y":309,"width":770,"height":11}},{"id":"0cbac44f-21b6-49b3-8a0c-0ad3b9f2da0b","block_type":"box","text":"regarding the sovereignty of Taiwan and has made threats of invasion. Taiwan-based companies and individuals are","page_number":88,"box":{"x":69,"y":324,"width":821,"height":12}},{"id":"6fd0009b-58be-4b0a-8a30-fbaf40648370","block_type":"box","text":"significant investors in China. The continuing hostility between China and Taiwan may have an adverse impact on the","page_number":88,"box":{"x":69,"y":339,"width":831,"height":12}},{"id":"68a0775f-03d2-496f-989f-a364795127c6","block_type":"box","text":"value of the Fund’s investments in China or Taiwan, may cause a suspension in a Fund’s ability to trade in cer tain","page_number":88,"box":{"x":68,"y":355,"width":812,"height":11}},{"id":"d9037178-9c37-49c8-b36a-936b8df42f27","block_type":"box","text":"securities or other assets or may otherwise make such investments impracticable or impossible. Any escalation of","page_number":88,"box":{"x":69,"y":370,"width":818,"height":11}},{"id":"270ed05f-f215-4271-8311-b2e874e35ca0","block_type":"box","text":"hostility between China and Taiwan would likely have a significant adverse impact on the value of the Fund’s","page_number":88,"box":{"x":69,"y":385,"width":769,"height":11}},{"id":"7ee95b72-91b7-41fe-a8ca-7cd44bef983b","block_type":"box","text":"investments in both countries and the region. In addition, China has strained international relations with Japan, India,","page_number":88,"box":{"x":70,"y":400,"width":836,"height":11}},{"id":"03a645cf-7290-4ed1-ab00-6ecda22eb768","block_type":"box","text":"the Philippines and other neighbors due to territorial disputes, historical animosities and other defense concerns.","page_number":88,"box":{"x":68,"y":415,"width":810,"height":11}},{"id":"41dccfac-af71-4d62-9c65-536eddbe8df3","block_type":"box","text":"Frictions between China and the Philippines in the South China Sea pose a risk of escalation potentially leading to","page_number":88,"box":{"x":70,"y":430,"width":813,"height":11}},{"id":"9431e395-f429-4a8a-b815-75c90f099a60","block_type":"box","text":"military conflict. Additionally, China is alleged to have par ticipated in state-sponsored cyberattacks against foreign","page_number":88,"box":{"x":69,"y":445,"width":811,"height":12}},{"id":"9134ddc5-535a-499d-94fe-0e9a5bc314de","block_type":"box","text":"companies and foreign governments. Actual and threatened responses to such activity and strained international","page_number":88,"box":{"x":69,"y":460,"width":804,"height":12}},{"id":"e733999b-3000-404c-8a3f-36fe571fa741","block_type":"box","text":"relations, including purchasing restrictions, sanctions, tariffs or cyberattacks on the Chinese government or Chinese","page_number":88,"box":{"x":69,"y":475,"width":829,"height":12}},{"id":"a39f4dd1-2137-4838-8340-e91b5e2936d1","block_type":"box","text":"companies, may impact China’s economy and Chinese issuers of securities in which a Fund invests. China could be","page_number":88,"box":{"x":69,"y":491,"width":825,"height":11}},{"id":"4ac799d5-b96e-4563-a128-f491d0f24dec","block_type":"box","text":"affected by military events on the Korean peninsula or internal instability within Nor th Korea. These situations may","page_number":88,"box":{"x":69,"y":506,"width":819,"height":11}},{"id":"2cfb4b25-663e-4c67-9396-d1ea135a58b4","block_type":"box","text":"cause uncer tainty in the Chinese market and may adversely affect the per formance of the Chinese economy.","page_number":88,"box":{"x":69,"y":521,"width":776,"height":11}},{"id":"73636c0c-4daa-4612-8a92-1abae04cb53f","block_type":"box","text":"The Chinese government has implemented economic reforms in order to liberalize trade policy, promote foreign","page_number":88,"box":{"x":101,"y":543,"width":792,"height":12}},{"id":"d1abce7b-ae9d-4fd5-8938-a961688babc6","block_type":"box","text":"investment in the economy, reduce government control of the economy and develop market mechanisms. However,","page_number":88,"box":{"x":70,"y":559,"width":818,"height":11}},{"id":"ba364284-cb8c-4aef-9b0b-02c1f84ac290","block_type":"box","text":"the Chinese government still exercises substantial influence over many aspects of the private sector and may own or","page_number":88,"box":{"x":68,"y":574,"width":835,"height":11}},{"id":"d0f15e0b-b8a5-4895-bbf9-a1ce05c53d44","block_type":"box","text":"control many companies. Chinese companies, such as those in the financial services or technology sectors, and","page_number":88,"box":{"x":69,"y":589,"width":802,"height":11}},{"id":"65f03051-0aa5-4a6b-8c5b-23fb1d9426b3","block_type":"box","text":"potentially other sectors in the future, are subject to the risk that Chinese authorities can intervene in their","page_number":88,"box":{"x":70,"y":604,"width":763,"height":11}},{"id":"2726a5b3-8f83-4556-96c1-e4fddb685c12","block_type":"box","text":"operations and structure. The Chinese government continues to maintain a major role in economic policymaking and","page_number":88,"box":{"x":69,"y":619,"width":829,"height":11}},{"id":"0324f1c8-e08e-4611-8e39-e49e20e30ea1","block_type":"box","text":"investing in China involves risk of loss due to expropriation, nationalization, confiscation of assets and proper ty or","page_number":88,"box":{"x":70,"y":634,"width":813,"height":12}},{"id":"7338c53f-a5de-43de-8f64-ec05e4104099","block_type":"box","text":"the imposition of restrictions on foreign investments and on repatriation of capital invested.","page_number":88,"box":{"x":68,"y":649,"width":653,"height":12}},{"id":"62f97534-2a29-4a38-be22-35736ed4134b","block_type":"box","text":"The Chinese government may intervene in the Chinese financial markets, such as by the imposition of trading","page_number":88,"box":{"x":101,"y":672,"width":783,"height":11}},{"id":"22023990-9680-4a74-af59-b0ac27e9abb3","block_type":"box","text":"restrictions, a ban on “naked” shor t selling or the suspension of shor t selling for cer tain stocks. This may affect","page_number":88,"box":{"x":69,"y":687,"width":805,"height":11}},{"id":"12fa9335-dc7b-48f7-80f7-054075a41cdd","block_type":"box","text":"market price and liquidity of these stocks, and may have an unpredictable impact on the investment activities of the","page_number":88,"box":{"x":69,"y":702,"width":827,"height":11}},{"id":"68079e59-5d5c-4f3c-bcaa-b43c6251f473","block_type":"box","text":"Funds. Fur thermore, such market interventions may have a negative impact on market sentiment which may in turn","page_number":88,"box":{"x":70,"y":718,"width":821,"height":11}},{"id":"c2ce6bb5-78b3-424d-9c30-66a440c50963","block_type":"box","text":"affect the per formance of the securities markets and as a result the per formance of the Funds.","page_number":88,"box":{"x":69,"y":732,"width":683,"height":11}},{"id":"65d46c72-67ec-45dc-b9c8-ee5821b0866a","block_type":"box","text":"In addition, there is less regulation and monitoring of Chinese securities markets and the activities of investors,","page_number":88,"box":{"x":102,"y":755,"width":797,"height":11}},{"id":"ddd62da5-9a73-4d3b-889f-c7a196e8ce8a","block_type":"box","text":"brokers and other par ticipants than in the United States. Accordingly, issuers of securities in China, including","page_number":88,"box":{"x":69,"y":770,"width":779,"height":12}},{"id":"083bd7a8-1d8b-4b1a-988c-d591b8646bb5","block_type":"box","text":"Chinese companies that are listed on U.S. exchanges, are not subject to the same degree of regulation as are U.S.","page_number":88,"box":{"x":69,"y":785,"width":822,"height":12}},{"id":"37d1a391-fe4d-4e7a-9fc9-d7448e3040b3","block_type":"box","text":"issuers with respect to such matters as insider trading rules, tender offer regulation, accounting standards or auditor","page_number":88,"box":{"x":70,"y":801,"width":836,"height":11}},{"id":"1d4415d1-2117-4701-ad29-a98ae6e3a2b8","block_type":"box","text":"oversight, stockholder proxy requirements and the requirements mandating timely and accurate disclosure of","page_number":88,"box":{"x":69,"y":816,"width":778,"height":11}},{"id":"f7936193-4e3c-4ccd-b6dd-2d1148b159e1","block_type":"box","text":"information. Securities markets in China are in the process of change and fur ther development. This may lead to","page_number":88,"box":{"x":70,"y":831,"width":803,"height":11}},{"id":"d2769790-bd48-4db7-8dc7-3a7e3ed59fce","block_type":"box","text":"trading volatility, difficulty in the settlement and recording of transactions and difficulty in interpreting and applying","page_number":88,"box":{"x":68,"y":846,"width":816,"height":11}},{"id":"f98d9770-bdd7-45c6-8862-3fa0eed07176","block_type":"box","text":"the relevant regulation. Custodians may not be able to offer the level of service and safe-keeping in relation to the","page_number":88,"box":{"x":68,"y":861,"width":816,"height":11}},{"id":"a6ec42d1-c595-4034-ba9b-e5ecdc3f7da2","block_type":"box","text":"settlement and administration of securities in China that is customary in more developed markets. In par ticular,","page_number":88,"box":{"x":69,"y":876,"width":798,"height":11}},{"id":"167fd4fd-bc4e-47ba-8e62-32d58476a46e","block_type":"box","text":"there is a risk that a Fund may not be recognized as the owner of securities that are held on behalf of the Fund by a","page_number":88,"box":{"x":68,"y":891,"width":826,"height":12}},{"id":"84dff1eb-bf8e-434e-bf53-dd310a5315c5","block_type":"box","text":"sub-custodian.","page_number":88,"box":{"x":69,"y":907,"width":102,"height":8}},{"id":"f12f67ca-7732-4b68-b6e3-b2f44cdd172f","block_type":"box","text":"II-41","page_number":88,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"f8fc7316-817d-4fcf-93b6-38fb77421d76","block_type":"box","text":"NM1026U-6033063-88/246","page_number":88,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"15205253-8717-4f2f-9248-f487ebb1dc0e","block_type":"box","text":"There may be significant obstacles to obtaining information necessary for investigations into or litigation against","page_number":89,"box":{"x":101,"y":45,"width":801,"height":11}},{"id":"1bf47c0f-733c-4ead-92bc-29c39dc1725e","block_type":"box","text":"Chinese companies, and shareholders may have limited legal remedies. The Funds do not select investments based","page_number":89,"box":{"x":69,"y":60,"width":829,"height":11}},{"id":"e3e6a12b-0cdd-4e7f-b39d-7ccace2751cc","block_type":"box","text":"on investor protection considerations.","page_number":89,"box":{"x":69,"y":75,"width":268,"height":11}},{"id":"69749dac-2098-4c40-a157-e220ea55d0fd","block_type":"box","text":"The Chinese government historically took positions that prevented the U.S. Public Company Accounting Oversight","page_number":89,"box":{"x":101,"y":98,"width":806,"height":11}},{"id":"eeefce45-9e13-4672-829d-db77463c1a95","block_type":"box","text":"Board (“PCAOB”) from inspecting the audit work and practices of accounting firms in mainland China and Hong Kong","page_number":89,"box":{"x":70,"y":113,"width":829,"height":11}},{"id":"4397e72f-c0f7-45ae-9fce-d24cfbbe90f1","block_type":"box","text":"for compliance with U.S. law and professional standards. On August 26, 2022, the PCAOB signed a Statement of","page_number":89,"box":{"x":68,"y":128,"width":810,"height":11}},{"id":"9ad97c76-dc54-44e9-bd60-dd9a82b7d541","block_type":"box","text":"Protocol with the China Securities Regulatory Commission and the Ministry of Finance of the PRC, which marked the","page_number":89,"box":{"x":69,"y":143,"width":829,"height":11}},{"id":"c65da26a-05bd-4737-a70d-b041fa239440","block_type":"box","text":"first step toward opening access for the PCAOB to inspect and investigate registered public accounting firms","page_number":89,"box":{"x":68,"y":158,"width":774,"height":11}},{"id":"11472e02-2ddd-4204-a6b9-bbe87e76d11c","block_type":"box","text":"headquar tered in mainland China and Hong Kong completely in accordance with U.S. law. However, as this","page_number":89,"box":{"x":69,"y":173,"width":760,"height":11}},{"id":"9507a94e-41da-4668-a9c4-c8353c933b58","block_type":"box","text":"development is relatively recent, the implementation of the Statement of Protocol remains to be tested. Audits","page_number":89,"box":{"x":69,"y":188,"width":788,"height":11}},{"id":"fb290e71-70b7-45ad-9bb8-adaeed9347ed","block_type":"box","text":"per formed by PCAOB-registered accounting firms in mainland China and Hong Kong may be less reliable than those","page_number":89,"box":{"x":70,"y":203,"width":822,"height":12}},{"id":"49274b94-0636-4f65-809d-183bfbc2ab88","block_type":"box","text":"per formed by firms subject to PCAOB inspection. Accordingly, information about the Chinese securities in which the","page_number":89,"box":{"x":70,"y":218,"width":821,"height":12}},{"id":"bb98b8f0-89c6-49fe-a91a-063d7b7df2f2","block_type":"box","text":"Funds invest may be less reliable or complete. Under amendments to the Sarbanes-Oxley Act enacted in December","page_number":89,"box":{"x":70,"y":234,"width":820,"height":11}},{"id":"ab025743-7983-4e14-9d33-a52f5ad80cba","block_type":"box","text":"2020, which requires that the PCAOB be permitted to inspect the accounting firm of a U.S.-listed Chinese issuer,","page_number":89,"box":{"x":69,"y":249,"width":805,"height":11}},{"id":"1ce8de66-972c-4be6-a492-d0ceec79c7da","block_type":"box","text":"Chinese companies with securities listed on U.S. exchanges may be delisted if the PCAOB is unable to inspect the","page_number":89,"box":{"x":69,"y":264,"width":816,"height":11}},{"id":"b8c05454-61ef-466f-8abd-85a4e910a0da","block_type":"box","text":"accounting firm.","page_number":89,"box":{"x":69,"y":279,"width":112,"height":11}},{"id":"83d16626-d5a0-4ecc-9164-6fbdacee0d79","block_type":"box","text":"The Renminbi (“RMB”) is currently not a freely conver tible currency and is subject to foreign exchange control","page_number":89,"box":{"x":101,"y":302,"width":780,"height":11}},{"id":"e745832b-0193-4ba3-9a07-7c8a8502d8b8","block_type":"box","text":"policies and repatriation restrictions imposed by the Chinese government. The imposition of currency controls may","page_number":89,"box":{"x":70,"y":317,"width":815,"height":11}},{"id":"74baefb6-9be6-46d5-bfbc-7b61905272fa","block_type":"box","text":"negatively impact per formance and liquidity of the Funds as capital may become trapped in the PRC. The Funds could","page_number":89,"box":{"x":69,"y":332,"width":837,"height":11}},{"id":"bd69924f-677a-4081-af98-9a17400b71e3","block_type":"box","text":"be adversely affected by delays in, or a refusal to grant, any required governmental approval for repatriation of","page_number":89,"box":{"x":69,"y":347,"width":787,"height":11}},{"id":"a6458888-291c-48ea-8b35-d61aeee70c2c","block_type":"box","text":"capital, as well as by the application to the Funds of any restrictions on investments. Investing in entities either in, or","page_number":89,"box":{"x":69,"y":362,"width":837,"height":11}},{"id":"bbaeed26-80ae-472d-bca4-da8a8db28a2e","block_type":"box","text":"which have a substantial por tion of their operations in, the PRC may require the Funds to adopt special procedures,","page_number":89,"box":{"x":68,"y":377,"width":825,"height":11}},{"id":"baa2c120-f8d1-4a14-a14b-28c388b18c72","block_type":"box","text":"seek local government approvals or take other actions, each of which may involve additional costs and delays to the","page_number":89,"box":{"x":69,"y":392,"width":828,"height":12}},{"id":"828901a1-7524-4431-9915-6e05b1f8f8b7","block_type":"box","text":"Funds. The Fund may also incur costs in connection with conversions between U.S. dollars and RMB, as well as in","page_number":89,"box":{"x":70,"y":408,"width":812,"height":11}},{"id":"8599f023-86ca-49bc-bb55-3973d8808fd2","block_type":"box","text":"connection with conversions between the two separate types of RMB, the onshore RMB (“CNY”) and the offshore","page_number":89,"box":{"x":69,"y":423,"width":808,"height":11}},{"id":"ffca1240-df5d-4220-a7bc-42952df267a5","block_type":"box","text":"RMB (“CNH”).","page_number":89,"box":{"x":70,"y":438,"width":97,"height":11}},{"id":"d64bd42d-5480-4014-babf-fbbcefb9878c","block_type":"box","text":"Many Chinese companies listed on U.S. exchanges use variable interest entities or “VIEs” in their structure as a","page_number":89,"box":{"x":102,"y":460,"width":802,"height":12}},{"id":"71563e1c-dc28-4936-b8d2-c619750b62d5","block_type":"box","text":"result of foreign ownership restrictions. In a VIE structure, a Chinese operating company establishes a shell company","page_number":89,"box":{"x":69,"y":475,"width":837,"height":12}},{"id":"8147b3ad-6515-44f2-ad7b-616114566c3b","block_type":"box","text":"in another jurisdiction to issue stock to public shareholders. When a VIE structure is used by a Chinese company to","page_number":89,"box":{"x":70,"y":491,"width":822,"height":11}},{"id":"ec477a1e-9f75-4144-a3f9-f1147edad98b","block_type":"box","text":"list its stock in the U.S., instead of owning the equity securities of the Chinese company, the U.S.-listed shell","page_number":89,"box":{"x":70,"y":506,"width":775,"height":11}},{"id":"3bd27fac-e26a-4935-9ad7-b07c77c1dbe4","block_type":"box","text":"company directly or indirectly enters into contracts with the Chinese operating company under Chinese law. These","page_number":89,"box":{"x":69,"y":521,"width":809,"height":11}},{"id":"9cb27124-063a-4ce5-ba00-baaddf9d82f7","block_type":"box","text":"contracts provide the U.S.-listed shell company with only economic exposure to the Chinese company and do not","page_number":89,"box":{"x":69,"y":536,"width":803,"height":11}},{"id":"74c6d996-cb5d-426c-8acf-ff223edfdfd3","block_type":"box","text":"represent equity ownership in the operating company.","page_number":89,"box":{"x":69,"y":551,"width":380,"height":11}},{"id":"7ba9aa52-4d59-49fb-8e8b-b874d13d4e0b","block_type":"box","text":"While VIEs are a longstanding practice that is well known to Chinese officials and regulators, they have not been","page_number":89,"box":{"x":101,"y":574,"width":801,"height":11}},{"id":"301422f1-b3ed-4e32-85d4-e2cf8181b4b8","block_type":"box","text":"formally recognized under Chinese law. The Chinese government has provided guidance to and placed restrictions on","page_number":89,"box":{"x":68,"y":589,"width":833,"height":11}},{"id":"ec51f176-e124-4bbb-9fcb-3db485c0fa07","block_type":"box","text":"Chinese-based companies raising capital offshore, including through VIEs. In 2023, the China Securities Regulatory","page_number":89,"box":{"x":69,"y":604,"width":825,"height":11}},{"id":"c06498f6-c31d-4340-ad5e-4ae487fc9e3f","block_type":"box","text":"Commission (“CSRC”) released new rules that permit the use of VIE structures, provided they abide by Chinese laws","page_number":89,"box":{"x":69,"y":619,"width":832,"height":11}},{"id":"2a9f3dcc-ed27-41be-8463-845275a421d2","block_type":"box","text":"and register with the CSRC. The rules, however, may cause Chinese companies to undergo greater scrutiny and add","page_number":89,"box":{"x":69,"y":634,"width":826,"height":12}},{"id":"ff2ff715-20cf-4a9c-818b-491dc80c8cd1","block_type":"box","text":"costs to VIE structures. Intervention, rulemaking or guidance by the Chinese government with respect to VIE","page_number":89,"box":{"x":69,"y":649,"width":770,"height":12}},{"id":"86e26928-76ab-478b-b457-58b60b24bfaf","block_type":"box","text":"structures or the non-enforcement of VIE-related contractual rights could significantly affect the operating company’s","page_number":89,"box":{"x":69,"y":664,"width":829,"height":12}},{"id":"605e0163-ce39-4be1-a1e6-b52ca157ffc6","block_type":"box","text":"business in China, the enforceability of the U.S.-listed shell company’s contractual arrangements with the Chinese","page_number":89,"box":{"x":69,"y":680,"width":815,"height":11}},{"id":"bd92f6e6-6fe7-4820-b9e8-983dfd7ba104","block_type":"box","text":"company and the value of the U.S.-listed stock. Fur ther, the VIE contractual arrangement would likely be subject to","page_number":89,"box":{"x":69,"y":695,"width":815,"height":11}},{"id":"ea4711d1-353a-446c-b8b7-57e01cce38a6","block_type":"box","text":"Chinese law and jurisdiction, and remedies available to the U.S.-listed shell company are uncer tain and could be","page_number":89,"box":{"x":69,"y":710,"width":802,"height":11}},{"id":"2c899d5e-f97b-4b32-8f84-7466a7f7e55b","block_type":"box","text":"ineffective. In addition to the risk of government intervention, investments through a VIE structure are subject to the","page_number":89,"box":{"x":70,"y":725,"width":828,"height":11}},{"id":"9aafbcfe-715e-4991-adde-320dcbc7d1ac","block_type":"box","text":"risk that the China-based company (or its officers, directors, or Chinese equity owners) may breach those contractual","page_number":89,"box":{"x":69,"y":740,"width":833,"height":11}},{"id":"b1b29f95-f5e0-4b8d-bee2-7580bbe94f55","block_type":"box","text":"arrangements, or Chinese law changes in a way that adversely affects the enforceability of these arrangements, or","page_number":89,"box":{"x":69,"y":755,"width":819,"height":11}},{"id":"d3a40d93-b3ef-4904-966a-364050414b1e","block_type":"box","text":"those contracts are otherwise not enforceable under Chinese law, in which case the Fund may suffer significant","page_number":89,"box":{"x":68,"y":770,"width":798,"height":12}},{"id":"28079fe6-f814-4227-a5f2-c059d4687183","block_type":"box","text":"losses on its investments through a VIE structure with little or no recourse available. Any change in the operations of","page_number":89,"box":{"x":70,"y":785,"width":833,"height":12}},{"id":"2b6ac236-8c69-4b9b-9a72-74c31aa47268","block_type":"box","text":"entities in a VIE structure, the status of VIE contractual arrangements or the legal or regulatory environment in China,","page_number":89,"box":{"x":69,"y":801,"width":837,"height":11}},{"id":"aa1fe279-ad87-4754-b8cd-b18bb8fa5663","block_type":"box","text":"generally or with respect to specific industries, could result in significant, and possibly permanent and/or total,","page_number":89,"box":{"x":68,"y":816,"width":792,"height":11}},{"id":"256d83c8-b45b-4b19-85a0-2302979ea1e3","block_type":"box","text":"losses to a Fund.","page_number":89,"box":{"x":70,"y":831,"width":120,"height":9}},{"id":"44df66c4-8f41-43b7-b239-13deaf6f3408","block_type":"box","text":"While the Chinese economy has experienced past periods of rapid growth, there is no assurance that such","page_number":89,"box":{"x":101,"y":853,"width":760,"height":12}},{"id":"ccfc2294-de0d-4f15-93ad-7c4fdce4860c","block_type":"box","text":"growth rates will recur. Other economic challenges for China include indebtedness, weak consumer demand, trade","page_number":89,"box":{"x":68,"y":869,"width":815,"height":11}},{"id":"0e75e427-c2ed-457c-9a32-68293beb1c9b","block_type":"box","text":"tensions, and an aging population. China continues to face pressure from its trading par tners over its expor ting of its","page_number":89,"box":{"x":68,"y":884,"width":837,"height":11}},{"id":"0c7952d7-92ff-4165-b3d6-d1e288de0483","block_type":"box","text":"excess industrial capacity and overall approach to economic management. China’s economy is heavily dependent on","page_number":89,"box":{"x":69,"y":899,"width":830,"height":11}},{"id":"7913a5c0-4e25-4c9c-b06c-01765125828b","block_type":"box","text":"II-42","page_number":89,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"99821ffc-77ea-4c77-aac3-acedd24b0636","block_type":"box","text":"NM1026U-6033063-89/246","page_number":89,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"7cc45022-2184-450c-af93-726ac8a3bd27","block_type":"box","text":"expor t growth. Reduction in spending on Chinese products and services, supply chain diversification, institution of","page_number":90,"box":{"x":69,"y":45,"width":815,"height":11}},{"id":"1192ffa0-c761-41d4-a6bc-0a34aad6143d","block_type":"box","text":"additional tariffs, sanctions or other trade barriers (including as a result of heightened trade tensions between China","page_number":90,"box":{"x":69,"y":60,"width":832,"height":11}},{"id":"d2c799a9-81b7-4acc-97bd-b52bfe650d9a","block_type":"box","text":"and the United States or in response to actual or alleged Chinese cyber activity) or a downturn in any of the","page_number":90,"box":{"x":69,"y":75,"width":765,"height":11}},{"id":"0a9d6391-845f-409f-921f-d7d9247829a4","block_type":"box","text":"economies of China’s key trading par tners may have an adverse impact on the Chinese economy and the companies","page_number":90,"box":{"x":69,"y":90,"width":833,"height":11}},{"id":"7f25eb62-88ae-4994-bc59-e1f20ab6935a","block_type":"box","text":"in which a Fund invests. Cer tain Chinese companies (which may change from time to time) are directly or indirectly","page_number":90,"box":{"x":70,"y":105,"width":816,"height":11}},{"id":"360d6db3-d7bc-41ec-bf09-37de14dca977","block_type":"box","text":"subject to economic or trade restrictions imposed by the U.S. or other governments due to national security, human","page_number":90,"box":{"x":69,"y":120,"width":824,"height":12}},{"id":"fbbe47d9-4e35-48ca-983c-4482e3f2543d","block_type":"box","text":"rights or other concerns of such government. For example, cer tain foreign technology companies are subject to U.S.","page_number":90,"box":{"x":69,"y":135,"width":825,"height":12}},{"id":"387411f6-a7f0-41a3-b66c-1b52720c514c","block_type":"box","text":"expor t controls as those companies are believed to pose a risk to U.S. interests. The U.S. also bans impor ts of","page_number":90,"box":{"x":69,"y":150,"width":798,"height":11}},{"id":"3074988c-0e97-48dd-98c4-2fb13f957a9d","block_type":"box","text":"goods produced in cer tain regions of China or by cer tain Chinese companies due to concerns about forced labor.","page_number":90,"box":{"x":68,"y":166,"width":805,"height":11}},{"id":"e7702df0-44b8-4b69-b9d7-cfafcdc1d6a7","block_type":"box","text":"Such restrictions may have unanticipated and adverse effects on the Chinese economy and companies. Any action","page_number":90,"box":{"x":69,"y":181,"width":817,"height":11}},{"id":"a830bd52-5193-4f47-bb9e-f5af68dec2bd","block_type":"box","text":"that targets Chinese financial markets or securities exchanges could inter fere with orderly trading, delay settlement","page_number":90,"box":{"x":68,"y":196,"width":825,"height":11}},{"id":"c3ea0ee9-3eed-4c14-80b4-6efb8fe59811","block_type":"box","text":"or cause market disruptions. Cer tain companies may be subject to economic or trade restrictions (but not investment","page_number":90,"box":{"x":69,"y":211,"width":839,"height":11}},{"id":"dfa4e5cd-9fe5-45f8-8047-81d73bec3f52","block_type":"box","text":"restrictions) imposed by the U.S. or other governments due to national security, human rights or other concerns of","page_number":90,"box":{"x":69,"y":226,"width":815,"height":11}},{"id":"6e6f7cd2-88d1-4e5a-b2eb-39b33f9eea60","block_type":"box","text":"such government. So long as these restrictions do not include restrictions on investments, the Fund may invest in","page_number":90,"box":{"x":69,"y":241,"width":812,"height":11}},{"id":"0e75e536-f8d5-4065-a1ff-fb0406bfde91","block_type":"box","text":"such companies.","page_number":90,"box":{"x":69,"y":257,"width":119,"height":10}},{"id":"360bf615-0830-42c3-9b6d-a0e79f8e5f89","block_type":"box","text":"The tax laws and regulations in the PRC are subject to change, including the issuance of authoritative guidance","page_number":90,"box":{"x":101,"y":279,"width":792,"height":11}},{"id":"4802d08a-4e3e-479f-ae03-06e9e216933c","block_type":"box","text":"or enforcement, possibly with retroactive effect. The interpretation, applicability and enforcement of such laws by PRC","page_number":90,"box":{"x":69,"y":294,"width":840,"height":11}},{"id":"b4561a95-8018-4e72-97d3-9f6856cdcf46","block_type":"box","text":"tax authorities are not as consistent and transparent as those of more developed nations, and may vary over time","page_number":90,"box":{"x":68,"y":309,"width":815,"height":11}},{"id":"977f5fc0-c24e-4e1e-a418-127dc4852ad8","block_type":"box","text":"and from region to region. The application and enforcement of PRC tax rules could have a significant adverse effect","page_number":90,"box":{"x":69,"y":324,"width":823,"height":12}},{"id":"ac10c4ab-e86d-45be-ac26-a9c1f76e8fe8","block_type":"box","text":"on a Fund and its investors, par ticularly in relation to capital gains withholding tax imposed upon non-residents. In","page_number":90,"box":{"x":69,"y":340,"width":812,"height":11}},{"id":"ff7b4901-a196-4719-8570-6d498fe215b5","block_type":"box","text":"addition, the accounting, auditing and financial repor ting standards and practices applicable to Chinese companies","page_number":90,"box":{"x":69,"y":355,"width":821,"height":11}},{"id":"45261e9b-7b9c-4c98-9b30-68601468cbaf","block_type":"box","text":"may be less rigorous, and may result in significant differences between financial statements prepared in accordance","page_number":90,"box":{"x":69,"y":370,"width":832,"height":11}},{"id":"bd124fdd-6eab-4b80-9940-11e152324fa4","block_type":"box","text":"with PRC accounting standards and practice and those prepared in accordance with international accounting","page_number":90,"box":{"x":68,"y":385,"width":773,"height":11}},{"id":"7bbd386d-aaef-4891-8abf-9502db02eecd","block_type":"box","text":"standards.","page_number":90,"box":{"x":69,"y":400,"width":74,"height":9}},{"id":"07ee5fe8-7890-4d3a-b669-b362725f16e6","block_type":"box","text":"From time to time and in recent years, China has experienced outbreaks of infectious illnesses and the country","page_number":90,"box":{"x":102,"y":423,"width":794,"height":11}},{"id":"9cad7cc7-dc58-40db-a7f8-ff44abe8087b","block_type":"box","text":"may be subject to other public health threats, infectious illnesses, diseases or similar issues in the future. Any","page_number":90,"box":{"x":69,"y":438,"width":792,"height":11}},{"id":"774d3176-1f3a-4527-84f6-f26009cf10d3","block_type":"box","text":"spread of an infectious illness, public health threat or similar issue could reduce consumer demand or economic","page_number":90,"box":{"x":69,"y":453,"width":803,"height":11}},{"id":"f7a5acc4-8b73-40be-b551-e1b76e39d047","block_type":"box","text":"output, result in market closures, travel restrictions or quarantines, and generally have a significant impact on the","page_number":90,"box":{"x":69,"y":468,"width":811,"height":11}},{"id":"b5c75aed-1038-40b9-8b18-56e491d66ddb","block_type":"box","text":"Chinese economy, which in turn could adversely affect a Fund’s investments.","page_number":90,"box":{"x":69,"y":483,"width":548,"height":11}},{"id":"fe2cf2a4-a791-40e3-896e-d109508e6770","block_type":"box","text":"Risk of Investing through Stock Connect.","page_number":90,"box":{"x":102,"y":506,"width":288,"height":11}},{"id":"b81a536c-d336-4fd8-a185-9b5c5a744c85","block_type":"box","text":"General","page_number":90,"box":{"x":102,"y":529,"width":55,"height":8}},{"id":"2d634e42-bd64-42d5-868e-5be7d585f35c","block_type":"box","text":". China A-shares are equity securities of companies domiciled in China that trade on Chinese stock","page_number":90,"box":{"x":158,"y":528,"width":704,"height":12}},{"id":"a61a27f2-4cd5-4a1d-915c-59870b591d6e","block_type":"box","text":"exchanges such as the Shanghai Stock Exchange (“SSE”), the Shenzhen Stock Exchange (“SZSE”) and the Beijing","page_number":90,"box":{"x":69,"y":544,"width":815,"height":11}},{"id":"002e630e-e097-40f6-ac7a-9313296e8f5e","block_type":"box","text":"Stock Exchange (“BSE”) (“A-shares”). Foreign investment in A-shares on the SSE and SZSE is not permitted, other","page_number":90,"box":{"x":69,"y":559,"width":815,"height":11}},{"id":"03a84b52-133f-4276-ac01-06defd46eb32","block_type":"box","text":"than pursuant to available exceptions, such as through a qualified foreign investor approved pursuant to the relevant","page_number":90,"box":{"x":68,"y":574,"width":833,"height":11}},{"id":"ccbc7071-79fb-4db4-9cbe-6a697b53cdd5","block_type":"box","text":"mainland China laws and regulations as may be promulgated and/or amended from time to time (“QFI”).","page_number":90,"box":{"x":69,"y":589,"width":744,"height":11}},{"id":"7cc0e73e-9e59-4f22-b5d0-add8a1a50c7a","block_type":"box","text":"Investment in eligible exchange traded funds and A-shares listed and traded on the SSE or SZSE (“Stock","page_number":90,"box":{"x":102,"y":612,"width":745,"height":11}},{"id":"bf588131-b582-4222-a34e-ff322e396a0b","block_type":"box","text":"Connect Securities”) is also permitted through the Shanghai-Hong Kong Stock Connect program or the Shenzhen","page_number":90,"box":{"x":69,"y":627,"width":807,"height":11}},{"id":"023d4c7d-40f8-44aa-b5c3-8b29ba00c3e0","block_type":"box","text":"Hong Kong Stock Connect program, as applicable (each, a “Stock Connect” and collectively, “Stock Connects”). Each","page_number":90,"box":{"x":70,"y":642,"width":834,"height":11}},{"id":"97ca8875-1aeb-463a-a7c1-f77d6b3c61d4","block_type":"box","text":"Stock Connect is a securities trading and clearing links program established by The Stock Exchange of Hong Kong","page_number":90,"box":{"x":69,"y":657,"width":812,"height":11}},{"id":"154caa34-3a0d-4edb-8508-3da04937350a","block_type":"box","text":"Limited (“SEHK”), the Hong Kong Securities Clearing Company Limited (“HKSCC”), the SSE or SZSE, as applicable,","page_number":90,"box":{"x":70,"y":672,"width":819,"height":11}},{"id":"b391ce2f-21e0-48c1-9bcc-dbaac8116eb0","block_type":"box","text":"and China Securities Depository and Clearing Corporation Limited (“CSDCC”) that aims to provide mutual stock","page_number":90,"box":{"x":69,"y":687,"width":793,"height":11}},{"id":"19d9d978-c2bb-40c5-8944-4e8dc29b02ac","block_type":"box","text":"market access between the PRC and Hong Kong by permitting investors to trade and settle shares on each market","page_number":90,"box":{"x":69,"y":702,"width":818,"height":12}},{"id":"121aa57c-00d1-426a-9557-12a1e8e6d982","block_type":"box","text":"through their local securities brokers. Under Stock Connects, a Fund’s trading of Stock Connect Securities listed on","page_number":90,"box":{"x":68,"y":717,"width":824,"height":12}},{"id":"c5d763c8-a33f-4432-bf96-ab028ff469c3","block_type":"box","text":"the SSE or SZSE, as applicable, would be effectuated through its Hong Kong broker and a securities trading service","page_number":90,"box":{"x":68,"y":732,"width":827,"height":12}},{"id":"c25076ea-0519-4fa9-ae76-685d8b09babd","block_type":"box","text":"company established by SEHK.","page_number":90,"box":{"x":69,"y":748,"width":219,"height":11}},{"id":"e86ecdc1-5f6b-4f7d-a261-d8c6e2da35ab","block_type":"box","text":"Although no individual investment quotas or licensing requirements apply to investors in Stock Connect, trading","page_number":90,"box":{"x":101,"y":770,"width":794,"height":12}},{"id":"c148a319-48b8-4a6a-9a4a-6fadd68ff654","block_type":"box","text":"through a Stock Connect’s Nor thbound Trading Link is subject to daily investment quota limitations which require that","page_number":90,"box":{"x":68,"y":786,"width":839,"height":11}},{"id":"dd323cf8-250d-40c2-a006-3b744f62271e","block_type":"box","text":"buy orders for Stock Connect Securities be rejected once the daily quota is exceeded (although a Fund will be","page_number":90,"box":{"x":69,"y":801,"width":779,"height":11}},{"id":"46cf6f63-14e0-4221-9973-8458a9180c24","block_type":"box","text":"permitted to sell their Stock Connect Securities regardless of the quota). These limitations may restrict a Fund from","page_number":90,"box":{"x":70,"y":816,"width":824,"height":11}},{"id":"3d2aae79-2463-4b0b-8cd9-73e200ce9b24","block_type":"box","text":"investing in Stock Connect Securities on a timely basis, which could affect the Fund’s ability to effectively pursue its","page_number":90,"box":{"x":70,"y":831,"width":827,"height":11}},{"id":"93110909-3bdf-4d0b-bdb9-392c707af01a","block_type":"box","text":"investment strategy. Investment quotas are also subject to change. Investment in Stock Connect Securities through a","page_number":90,"box":{"x":70,"y":846,"width":837,"height":11}},{"id":"e33f1a75-c625-4042-b89f-b6ef74050cf6","block_type":"box","text":"Stock Connect is subject to trading, clearance and settlement procedures that could pose risks to a Fund. Stock","page_number":90,"box":{"x":69,"y":861,"width":802,"height":11}},{"id":"5d1dc93c-d5ca-4ff2-93e2-b056040341ad","block_type":"box","text":"Connect Securities purchased through Stock Connects generally may not be sold or otherwise transferred other than","page_number":90,"box":{"x":69,"y":876,"width":831,"height":11}},{"id":"cca61ca0-f3e5-4e24-a5e3-5fda5373f913","block_type":"box","text":"through Stock Connects in accordance with applicable rules. For example, the PRC regulations require that in order","page_number":90,"box":{"x":68,"y":891,"width":821,"height":12}},{"id":"e914c43c-e99b-4d5e-be16-79b34f44f2cc","block_type":"box","text":"for an investor to sell any Stock Connect Securities on a cer tain trading day, there must be sufficient Stock Connect","page_number":90,"box":{"x":68,"y":906,"width":829,"height":12}},{"id":"65da7074-f849-446f-988d-8bea315b48eb","block_type":"box","text":"II-43","page_number":90,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"ed9627ed-4242-4289-8d17-3396019c18fd","block_type":"box","text":"NM1026U-6033063-90/246","page_number":90,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"ffe19e6d-0de9-4c55-a5ba-5b5e788db529","block_type":"box","text":"Securities in the investor’s account before the market opens on that day. If there are insufficient Stock Connect","page_number":91,"box":{"x":69,"y":45,"width":797,"height":11}},{"id":"4b334f5d-41bf-422f-bd82-927db910444b","block_type":"box","text":"Securities in the investor’s account, the sell order will be rejected by the SSE or SZSE, as applicable. SEHK carries","page_number":91,"box":{"x":69,"y":60,"width":820,"height":11}},{"id":"3112f476-fc1a-4303-a9d5-75f042695b62","block_type":"box","text":"out pre-trade checking on sell orders of cer tain stocks listed on the SSE market (“SSE Securities”) or SZSE market","page_number":91,"box":{"x":69,"y":75,"width":820,"height":11}},{"id":"3ecc3dd9-d492-4370-b0a3-98e011fed641","block_type":"box","text":"(“SZSE Securities”) of its par ticipants (","page_number":91,"box":{"x":69,"y":90,"width":278,"height":11}},{"id":"8faf2ec1-07da-4c36-8bad-466d8055dcb3","block_type":"box","text":"i.e.","page_number":91,"box":{"x":349,"y":90,"width":21,"height":9}},{"id":"77b678bc-e840-4ce8-a5a1-3bb29551cfec","block_type":"box","text":", stock brokers) to ensure that this requirement is satisfied. While shares","page_number":91,"box":{"x":372,"y":90,"width":524,"height":11}},{"id":"7e9f60d9-876b-4220-ad77-de608ad2d1ea","block_type":"box","text":"must be designated as eligible to be traded under a Stock Connect, those shares may also lose such designation,","page_number":91,"box":{"x":69,"y":105,"width":815,"height":11}},{"id":"30fbdbee-9eca-4342-9230-a5e678d35af2","block_type":"box","text":"and if this occurs, such shares may be sold but cannot be purchased through a Stock Connect. In addition, Stock","page_number":91,"box":{"x":69,"y":120,"width":810,"height":12}},{"id":"6d934fa1-f39b-4878-a5f2-c8eb4a6bb7c7","block_type":"box","text":"Connects will only operate on days when both the Chinese and Hong Kong markets are open for trading, and banking","page_number":91,"box":{"x":69,"y":135,"width":834,"height":12}},{"id":"5a969da2-b85f-421e-95d6-86172c6de9f9","block_type":"box","text":"services are available in both markets on the corresponding settlement days. Therefore, an investment in Stock","page_number":91,"box":{"x":69,"y":150,"width":799,"height":12}},{"id":"17c225fb-3ed3-41ff-95c9-ef52530d0cf0","block_type":"box","text":"Connect Securities through a Stock Connect may subject a Fund to a risk of price fluctuations on days when the","page_number":91,"box":{"x":69,"y":166,"width":797,"height":11}},{"id":"2257046a-3bc0-4e9b-8435-90fbe3ecf0d9","block_type":"box","text":"Chinese market is open, but a Stock Connect is not trading. Moreover, day (turnaround) trading is not permitted on","page_number":91,"box":{"x":69,"y":181,"width":818,"height":11}},{"id":"43559790-eddb-474c-af8a-ac9ff9f671fe","block_type":"box","text":"the Stock Connect Securities market. If an investor buys Stock Connect Securities on day “T,” the investor will only","page_number":91,"box":{"x":68,"y":196,"width":820,"height":11}},{"id":"aae5698a-3608-4d99-b4c8-84460a7fecd1","block_type":"box","text":"be able to sell the Stock Connect Securities on or after day T+1. Fur ther, since all trades of Stock Connect Securities","page_number":91,"box":{"x":69,"y":211,"width":836,"height":11}},{"id":"c8fa6e0d-30e7-494d-8850-06e2218e7299","block_type":"box","text":"must be settled in RMB, investors must have timely access to a reliable supply of offshore RMB, which cannot be","page_number":91,"box":{"x":69,"y":226,"width":811,"height":11}},{"id":"d0797386-6cac-4833-ad79-84b147653aa4","block_type":"box","text":"guaranteed. There is also no assurance that RMB will not be subject to devaluation. Any devaluation of RMB could","page_number":91,"box":{"x":68,"y":241,"width":815,"height":11}},{"id":"8b760334-7565-4e03-b1a4-956fac1a9a80","block_type":"box","text":"adversely affect a Fund’s investments. If a Fund holds a class of shares denominated in a local currency other than","page_number":91,"box":{"x":69,"y":256,"width":824,"height":11}},{"id":"75a214a1-0471-4381-ba61-f9e911f49de4","block_type":"box","text":"RMB, the Fund will be exposed to currency exchange risk if the Fund conver ts the local currency into RMB for","page_number":91,"box":{"x":70,"y":271,"width":777,"height":12}},{"id":"bb82415a-c2f1-4001-9137-be560589a6e9","block_type":"box","text":"investments in Stock Connect Securities. A Fund may also incur conversion costs.","page_number":91,"box":{"x":70,"y":287,"width":582,"height":11}},{"id":"1f5978ab-1aa1-4c25-a0f2-990ee6460d16","block_type":"box","text":"Stock Connect Securities held through the nominee structure under a Stock Connect will be held through HKSCC","page_number":91,"box":{"x":102,"y":309,"width":802,"height":11}},{"id":"8bd85c07-87de-4f1f-ab5b-6ba404b0f44c","block_type":"box","text":"as nominee on behalf of investors. The precise nature and rights of a Fund as the beneficial owner of the SSE","page_number":91,"box":{"x":69,"y":324,"width":784,"height":12}},{"id":"e528f21a-7888-4bc7-b279-1309a89bcb45","block_type":"box","text":"Securities or SZSE Securities through HKSCC as nominee is not well defined under the PRC laws. There is a lack of a","page_number":91,"box":{"x":69,"y":339,"width":837,"height":12}},{"id":"53d7055b-140a-413d-9e80-b2619e59be8c","block_type":"box","text":"clear definition of, and distinction between, legal ownership and beneficial ownership under the PRC laws and there","page_number":91,"box":{"x":69,"y":355,"width":822,"height":11}},{"id":"6b7211f3-bc06-4a3b-a6ee-719aa50e9b98","block_type":"box","text":"have been few cases involving a nominee account structure in the PRC cour ts. The exact nature and methods of","page_number":91,"box":{"x":69,"y":370,"width":802,"height":11}},{"id":"8a5b6505-00a2-4192-8d2d-b5998e8ac349","block_type":"box","text":"enforcement of the rights and interests of a Fund under the PRC laws is also uncer tain. In the unlikely event that","page_number":91,"box":{"x":69,"y":385,"width":805,"height":11}},{"id":"eb808bbf-7949-475f-b689-d38c09d5264f","block_type":"box","text":"HKSCC becomes subject to winding up proceedings in Hong Kong, there is a risk that the SSE Securities or SZSE","page_number":91,"box":{"x":70,"y":400,"width":807,"height":11}},{"id":"89ffec10-9491-469e-9e74-3cb1fa867499","block_type":"box","text":"Securities may not be regarded as held for the beneficial ownership of a Fund or as par t of the general assets of","page_number":91,"box":{"x":69,"y":415,"width":805,"height":11}},{"id":"e8101fe1-3c1d-4545-8292-cec20d642df3","block_type":"box","text":"HKSCC available for general distribution to its creditors. Notwithstanding the fact that HKSCC does not claim","page_number":91,"box":{"x":70,"y":430,"width":774,"height":11}},{"id":"db40346a-0686-4952-a905-22cb5494e81e","block_type":"box","text":"proprietary interests in the SSE Securities or SZSE Securities held in its omnibus stock account in the CSDCC, the","page_number":91,"box":{"x":70,"y":445,"width":816,"height":11}},{"id":"e8b36638-ae13-4a3f-ad5c-6138a3374182","block_type":"box","text":"CSDCC as the share registrar for SSE- or SZSE-listed companies will still treat HKSCC as one of the shareholders","page_number":91,"box":{"x":69,"y":460,"width":808,"height":12}},{"id":"38cb251d-b579-46f2-a94b-a2ff07590e23","block_type":"box","text":"when it handles corporate actions in respect of such SSE Securities or SZSE Securities. HKSCC monitors the","page_number":91,"box":{"x":68,"y":475,"width":779,"height":11}},{"id":"60c0da30-a85c-44d6-8e7b-84a3b7342608","block_type":"box","text":"corporate actions affecting SSE Securities and SZSE Securities and keeps par ticipants of Central Clearing and","page_number":91,"box":{"x":69,"y":491,"width":788,"height":11}},{"id":"13a9d11c-1402-404e-9ff6-a60fb9effb43","block_type":"box","text":"Settlement System (“CCASS”) informed of all such corporate actions that require CCASS par ticipants to take steps in","page_number":91,"box":{"x":69,"y":506,"width":839,"height":11}},{"id":"183242e2-9af7-4132-aafc-c5069855ff79","block_type":"box","text":"order to par ticipate in them. Investors may only exercise their voting rights by providing their voting instructions to","page_number":91,"box":{"x":69,"y":521,"width":811,"height":11}},{"id":"d31d5215-a315-49f1-b686-de06579961a9","block_type":"box","text":"HKSCC through par ticipants of CCASS. All voting instructions from CCASS par ticipants will be consolidated by","page_number":91,"box":{"x":70,"y":536,"width":783,"height":11}},{"id":"d15bb4d2-7f93-42d3-878e-61c5f24936de","block_type":"box","text":"HKSCC, who will then submit a combined single voting instruction to the relevant SSE- or SZSE-listed company. As a","page_number":91,"box":{"x":70,"y":551,"width":826,"height":11}},{"id":"7de18737-7256-4609-9339-cb9459d7e814","block_type":"box","text":"result, a Fund may suffer difficulties or delays in enforcing its rights in SSE Securities or SZSE Securities.","page_number":91,"box":{"x":69,"y":566,"width":752,"height":11}},{"id":"e47756bb-2776-402c-b356-685544f84060","block_type":"box","text":"Hong Kong’s Investor Compensation Fund is established to pay compensation to investors of any nationality who","page_number":91,"box":{"x":102,"y":589,"width":804,"height":11}},{"id":"cb229062-5e02-43ec-b7b0-11ed78d53bc0","block_type":"box","text":"suffer pecuniary losses as a result of default of a licensed intermediary or authorized financial institution in relation","page_number":91,"box":{"x":69,"y":604,"width":826,"height":11}},{"id":"4e306e65-2ef8-442a-83a1-247e64a98b77","block_type":"box","text":"to exchange-traded products in Hong Kong. For defaults occurring on or after January 1, 2020, Hong Kong’s","page_number":91,"box":{"x":68,"y":619,"width":769,"height":11}},{"id":"d7631b7c-265e-4590-a5f5-de6f78ae13e6","block_type":"box","text":"Investor Compensation Fund covers investors’ losses in relation to securities (i) that are traded on the SSE or the","page_number":91,"box":{"x":70,"y":634,"width":809,"height":11}},{"id":"bf79bc74-93fa-406a-9199-8f52e221785b","block_type":"box","text":"SZSE and (ii) in respect of which an order for sale or purchase is permitted to be routed through the Nor thbound","page_number":91,"box":{"x":69,"y":649,"width":801,"height":12}},{"id":"8e92aa3e-702e-4cbd-8628-6c6918b91495","block_type":"box","text":"Trading Link of a Stock Connect. On the other hand, since a Fund carries out Nor thbound trading through securities","page_number":91,"box":{"x":68,"y":664,"width":822,"height":12}},{"id":"855a73ff-e6c7-4d84-be40-b42107fd1cf7","block_type":"box","text":"brokers in Hong Kong but not PRC brokers, it is not protected by the China Securities Investor Protection Fund in the","page_number":91,"box":{"x":69,"y":680,"width":829,"height":11}},{"id":"5347ee19-45cc-4dcc-ab4f-d1b4851ce057","block_type":"box","text":"PRC.","page_number":91,"box":{"x":69,"y":695,"width":32,"height":9}},{"id":"45885986-16a0-47e6-ba59-f2565a82611a","block_type":"box","text":"Market par ticipants are able to par ticipate in Stock Connects subject to meeting cer tain information technology","page_number":91,"box":{"x":102,"y":717,"width":796,"height":12}},{"id":"32308cbb-8665-49a5-9bcd-d18fc81eb385","block_type":"box","text":"capability, risk management and other requirements as may be specified by the relevant exchange and/or clearing","page_number":91,"box":{"x":69,"y":732,"width":815,"height":12}},{"id":"e5c2e742-dfa0-45e5-adf4-85adaa9dd0d7","block_type":"box","text":"house. Fur ther, the “connectivity” in Stock Connects requires routing of orders across the border of Hong Kong and","page_number":91,"box":{"x":69,"y":748,"width":822,"height":11}},{"id":"9bf3b08b-c9b7-42cc-b43f-1dbb3eecf99e","block_type":"box","text":"the PRC. This requires the development of new information technology systems on the par t of SEHK and exchange","page_number":91,"box":{"x":68,"y":763,"width":818,"height":11}},{"id":"bb6fb506-d8fe-4b59-a661-a808818dd638","block_type":"box","text":"par ticipants. There is no assurance that the systems of SEHK and market par ticipants will function properly or will","page_number":91,"box":{"x":70,"y":778,"width":813,"height":11}},{"id":"61355417-bbf4-4425-a114-050d7dffbc45","block_type":"box","text":"continue to be adapted to changes and developments in both markets. In the event that the relevant systems fail to","page_number":91,"box":{"x":69,"y":793,"width":827,"height":11}},{"id":"c71a58e3-cf60-4a84-a330-3041714f81b5","block_type":"box","text":"function properly, trading in Stock Connect Securities through Stock Connects could be disrupted.","page_number":91,"box":{"x":68,"y":808,"width":695,"height":11}},{"id":"05c53392-dd7a-4243-91ce-5c01ee763c75","block_type":"box","text":"The Shanghai-Hong Kong Stock Connect program launched in November 2014 and the Shenzhen-Hong Kong","page_number":91,"box":{"x":101,"y":831,"width":772,"height":11}},{"id":"9219d373-f188-4217-bf2f-39c1ece8f82e","block_type":"box","text":"Stock Connect program launched in December 2016. Each program does not have an extensive operating history.","page_number":91,"box":{"x":69,"y":846,"width":810,"height":11}},{"id":"8150e358-aeaf-422f-becc-89c12eda7062","block_type":"box","text":"New or revised regulations may be issued from time to time by the regulators and stock exchanges in China and","page_number":91,"box":{"x":70,"y":861,"width":798,"height":11}},{"id":"f7b783d6-fb54-406d-acd8-32a737c84838","block_type":"box","text":"Hong Kong in connection with operations, legal enforcement and cross-border trades under Stock Connects. In","page_number":91,"box":{"x":70,"y":876,"width":786,"height":11}},{"id":"2e1f5632-44ae-4350-a56b-e4103c288bca","block_type":"box","text":"addition, there can be no assurance that Stock Connect will not be discontinued. A Fund may be adversely affected","page_number":91,"box":{"x":69,"y":891,"width":821,"height":11}},{"id":"f6f87c15-4b57-4138-95fd-7fa15e3a25fd","block_type":"box","text":"as a result of such changes. Fur thermore, the securities regimes and legal systems of China and Hong Kong differ","page_number":91,"box":{"x":69,"y":906,"width":819,"height":12}},{"id":"f8c348cc-cf42-4786-91e8-35327a245278","block_type":"box","text":"II-44","page_number":91,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"099f5565-b66f-4a1d-873f-2e521bb5deca","block_type":"box","text":"NM1026U-6033063-91/246","page_number":91,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"f323ac1d-68fe-4d91-8953-67e126353e43","block_type":"box","text":"significantly and issues may arise from the differences on an on-going basis. In the event that the relevant systems","page_number":92,"box":{"x":69,"y":45,"width":823,"height":11}},{"id":"0edcf8a9-823f-4b6b-83e1-f13808052fd5","block_type":"box","text":"fail to function properly, trading in both markets through Stock Connects could be disrupted and a Fund’s ability to","page_number":92,"box":{"x":68,"y":60,"width":814,"height":11}},{"id":"b81a859f-a8a4-44ae-ba0b-e9b74b1a9b4a","block_type":"box","text":"achieve its investment objective may be adversely affected. In addition, a Fund’s investments in Stock Connect","page_number":92,"box":{"x":69,"y":75,"width":793,"height":11}},{"id":"1959edb2-c6ff-48d4-9632-fea6f6f16edb","block_type":"box","text":"Securities through Stock Connects are generally subject to Chinese securities regulations and listing rules, among","page_number":92,"box":{"x":69,"y":90,"width":815,"height":11}},{"id":"376d50b5-cfb9-40cb-ab3a-27b752477b42","block_type":"box","text":"other restrictions. Fur ther, different fees, costs and taxes are imposed on foreign investors acquiring Stock Connect","page_number":92,"box":{"x":69,"y":105,"width":828,"height":11}},{"id":"7fc03c4b-d173-492e-a2a1-83e3b3fd1306","block_type":"box","text":"Securities through Stock Connects, and these fees, costs and taxes may be higher than comparable fees, costs and","page_number":92,"box":{"x":69,"y":120,"width":831,"height":12}},{"id":"600dc395-2a4a-469e-8792-12aa4fe36c30","block_type":"box","text":"taxes imposed on owners of other securities providing similar investment exposure.","page_number":92,"box":{"x":68,"y":135,"width":596,"height":12}},{"id":"48422f37-a2af-42d3-82a7-63de92f88f43","block_type":"box","text":"Suspension Risk.","page_number":92,"box":{"x":102,"y":158,"width":122,"height":11}},{"id":"f12b2b45-be48-4d7f-8d4a-254523be912f","block_type":"box","text":"SSE Securities and SZSE Securities may only be bought from, or sold to, a Fund at times when","page_number":92,"box":{"x":231,"y":158,"width":675,"height":11}},{"id":"2ae42c42-ab04-4cca-bcfe-8c0688c56b21","block_type":"box","text":"the relevant SSE Securities and SZSE Securities may be sold or purchased on the relevant Chinese stock exchange.","page_number":92,"box":{"x":68,"y":173,"width":829,"height":11}},{"id":"bb1c3bb0-8f0a-431d-ad07-140229653d10","block_type":"box","text":"The SSE Securities and SZSE Securities markets have a higher propensity for trading suspensions than many other","page_number":92,"box":{"x":68,"y":188,"width":823,"height":12}},{"id":"988a6abf-333b-4415-9efe-5b766228983a","block_type":"box","text":"global equity markets. Each of the SEHK, SSE and SZSE reserves the right to suspend trading of SSE Securities and","page_number":92,"box":{"x":68,"y":203,"width":831,"height":12}},{"id":"a5fa8d33-7290-402b-a52d-ae562c1d9fed","block_type":"box","text":"SZSE Securities purchased on the Stock Connects if necessary for ensuring an orderly and fair market and ensuring","page_number":92,"box":{"x":69,"y":218,"width":828,"height":12}},{"id":"173c9873-189c-4275-8ac6-0150a4090980","block_type":"box","text":"that risks are managed prudently. Consent from the relevant regulator would be sought before a suspension of","page_number":92,"box":{"x":68,"y":234,"width":791,"height":11}},{"id":"345e7905-91a6-439c-ab82-8fcf74163646","block_type":"box","text":"Nor thbound trading is triggered. The relevant PRC government authority may also impose “circuit breakers” and other","page_number":92,"box":{"x":70,"y":249,"width":837,"height":11}},{"id":"c4405127-be4d-4be8-aecf-421ac10f6c49","block_type":"box","text":"measures to halt or suspend Nor thbound trading. Where a suspension in the Nor thbound trading through Stock","page_number":92,"box":{"x":69,"y":264,"width":796,"height":11}},{"id":"15d77809-d87d-4b8e-915a-fb54e2bb17c7","block_type":"box","text":"Connect is effected, the Fund’s ability to access the PRC market will be adversely affected. Trading suspensions in","page_number":92,"box":{"x":69,"y":279,"width":820,"height":11}},{"id":"be0d7906-fcb1-444b-adad-add4a6fc26db","block_type":"box","text":"cer tain stocks could lead to greater market execution risk and costs for a Fund. The SSE and SZSE currently apply a","page_number":92,"box":{"x":69,"y":294,"width":829,"height":11}},{"id":"d2f27cfa-2073-4bb7-b593-943f2d8330d5","block_type":"box","text":"daily price limit, generally set at 10%, of the amount of fluctuation permitted in the prices of the relevant SSE","page_number":92,"box":{"x":69,"y":309,"width":778,"height":11}},{"id":"79ee7477-5db8-42f3-9a9c-f23d360e7db5","block_type":"box","text":"Securities and SZSE Securities during a single trading day. The daily price limit refers to price movements only and","page_number":92,"box":{"x":69,"y":324,"width":815,"height":12}},{"id":"d4c7d88b-c8e6-4d6b-973a-b747b9ab19e7","block_type":"box","text":"does not restrict trading within the relevant limit. There can be no assurance that a liquid market on an exchange will","page_number":92,"box":{"x":69,"y":340,"width":833,"height":11}},{"id":"fc2f4b07-9305-4963-989b-aa1e2cf2c5d6","block_type":"box","text":"exist for any par ticular SSE Security or SZSE Security or for any par ticular time.","page_number":92,"box":{"x":69,"y":355,"width":563,"height":11}},{"id":"b09022ee-dfd1-4f29-a13e-477ffc7f8a03","block_type":"box","text":"Risk of Investing in the China Interbank Bond Market through Bond Connect.","page_number":92,"box":{"x":102,"y":377,"width":542,"height":12}},{"id":"8c8b9a9d-031a-4fbf-a8cd-04de59747950","block_type":"box","text":"A Fund may invest directly in the","page_number":92,"box":{"x":650,"y":377,"width":230,"height":11}},{"id":"54b7e347-a814-4f45-951a-350c499d0294","block_type":"box","text":"domestic bond market in the PRC (the “China Interbank Bond Market”) through the nor thbound trading of Bond","page_number":92,"box":{"x":69,"y":392,"width":791,"height":12}},{"id":"d17046c8-e558-4cd2-bd34-7bdaa76ab504","block_type":"box","text":"Connect (“Bond Connect”). Bond Connect is an initiative launched in July 2017 for mutual bond market access","page_number":92,"box":{"x":69,"y":407,"width":790,"height":12}},{"id":"32669d82-2a88-4019-9678-a189f7f4598e","block_type":"box","text":"between the PRC and Hong Kong, established by the China Foreign Exchange Trade System & National Interbank","page_number":92,"box":{"x":69,"y":423,"width":803,"height":11}},{"id":"29d066fa-833c-4ab1-ac6e-69f1e0f04442","block_type":"box","text":"Funding Centre (“CFETS”), China Central Depository & Clearing Co., Ltd (“CDCC”), Shanghai Clearing House (“SCH”),","page_number":92,"box":{"x":70,"y":438,"width":832,"height":11}},{"id":"49f8b320-d970-4252-98ae-a7280d558d56","block_type":"box","text":"Hong Kong Exchanges and Clearing Limited (“HKEX”) and Central Moneymarkets Unit (“CMU”). Under the prevailing","page_number":92,"box":{"x":70,"y":453,"width":821,"height":11}},{"id":"5fe21427-5e89-4aab-85a3-d3fed2db0a23","block_type":"box","text":"regulations in the PRC, eligible foreign investors are allowed to invest in the bonds circulated in the China Interbank","page_number":92,"box":{"x":69,"y":468,"width":825,"height":11}},{"id":"de72791c-f2d9-43a2-977d-527c31ef339d","block_type":"box","text":"Bond Market through Bond Connect. Eligible foreign investors may submit trade requests for bonds circulated in the","page_number":92,"box":{"x":70,"y":483,"width":825,"height":11}},{"id":"8c988006-2752-48f8-9aec-b013587c306c","block_type":"box","text":"China Interbank Bond Market through offshore electronic bond trading platforms (such as Tradeweb), which will in","page_number":92,"box":{"x":69,"y":498,"width":809,"height":11}},{"id":"adc852c7-7993-4aaa-94d2-9481d26eab5d","block_type":"box","text":"turn transmit their requests for quotation to CFETS. CFETS will send the requests for quotation to a number of","page_number":92,"box":{"x":68,"y":513,"width":786,"height":11}},{"id":"05a7162f-c5a9-443d-ae1d-9c28c8ec15a3","block_type":"box","text":"approved onshore dealers (including market makers and others engaged in the market making business) in the PRC.","page_number":92,"box":{"x":69,"y":529,"width":830,"height":11}},{"id":"6c747dc9-8fe6-45d4-a9e4-e74e5850cc79","block_type":"box","text":"The approved onshore dealer(s) will respond to the requests for quotation via CFETS and CFETS will send their","page_number":92,"box":{"x":68,"y":543,"width":788,"height":12}},{"id":"4b50ab2e-b265-4cb7-b607-41f64509453f","block_type":"box","text":"responses to those eligible foreign investors through the same offshore electronic bond trading platforms. Once the","page_number":92,"box":{"x":69,"y":559,"width":827,"height":11}},{"id":"3e6faa18-aade-45d6-8ebd-96ecbe912c52","block_type":"box","text":"eligible foreign investor accepts the quotation, the trade is concluded on CFETS.","page_number":92,"box":{"x":69,"y":574,"width":570,"height":11}},{"id":"22e753a4-3835-4b81-9310-67948439b3ea","block_type":"box","text":"The settlement and custody of bonds traded in the China Interbank Bond Market under Bond Connect will be","page_number":92,"box":{"x":101,"y":596,"width":773,"height":12}},{"id":"ef03c331-ab29-488f-8bf4-1afc19a86c79","block_type":"box","text":"effected through the settlement and custody link between CMU, as an offshore custody agent, and CDCC and SCH,","page_number":92,"box":{"x":69,"y":612,"width":823,"height":11}},{"id":"5a51bff3-a212-452f-b036-af63606de8b7","block_type":"box","text":"as onshore custodians and clearing institutions in the PRC. Under the settlement link, CDCC or SCH will effect gross","page_number":92,"box":{"x":69,"y":627,"width":832,"height":11}},{"id":"e8044014-d7ab-49a2-8807-351daa19d1d0","block_type":"box","text":"settlement of confirmed trades onshore and CMU will process bond settlement instructions from CMU members on","page_number":92,"box":{"x":69,"y":642,"width":822,"height":11}},{"id":"061ae137-3cda-4e8a-a78e-ed0c03067c56","block_type":"box","text":"behalf of eligible foreign investors in accordance with its relevant rules. Since the introduction in August 2018 of","page_number":92,"box":{"x":69,"y":657,"width":804,"height":11}},{"id":"0d77a408-d46b-49e4-bb14-bccf6a07ef78","block_type":"box","text":"delivery versus payment (DVP) settlement in respect of Bond Connect, the movement of cash and securities is","page_number":92,"box":{"x":69,"y":672,"width":787,"height":11}},{"id":"eb921785-75a4-462a-b701-dea51ed7ceba","block_type":"box","text":"carried out simultaneously on a real-time basis. Pursuant to the prevailing regulations in the PRC, CMU, as the","page_number":92,"box":{"x":69,"y":687,"width":788,"height":11}},{"id":"6c36621c-52ed-408d-a90a-eb26cd72bc1b","block_type":"box","text":"offshore custody agent recognized by the Hong Kong Monetary Authority, will open omnibus nominee accounts with","page_number":92,"box":{"x":69,"y":702,"width":820,"height":12}},{"id":"b92a97e1-0a59-4a99-ac16-b08625396e49","block_type":"box","text":"the onshore custody agent recognized by the People’s Bank of China (","page_number":92,"box":{"x":68,"y":717,"width":500,"height":12}},{"id":"cf8a46c9-111f-46be-abf0-3c4ca755b1e8","block_type":"box","text":"i.e.","page_number":92,"box":{"x":570,"y":718,"width":20,"height":8}},{"id":"13212a6d-e5d3-4977-99dd-b52076c43d4d","block_type":"box","text":", CDCC and SCH). All bonds traded by","page_number":92,"box":{"x":593,"y":718,"width":267,"height":11}},{"id":"8b6b930d-f1aa-456b-b3c5-055973fd78d6","block_type":"box","text":"eligible foreign investors through Bond Connect will be registered in the name of CMU, which will hold such bonds as","page_number":92,"box":{"x":69,"y":732,"width":832,"height":12}},{"id":"82d0369d-9ebe-4235-9bbb-417b983deb7e","block_type":"box","text":"a nominee owner. Therefore, a Fund will be exposed to custody risks with respect to CMU. In the remote event of a","page_number":92,"box":{"x":69,"y":748,"width":819,"height":11}},{"id":"89e52eea-0a50-4ffe-ac71-6c48d6cfda97","block_type":"box","text":"CDCC or SCH default, CMU’s liabilities in Bond Connect bonds under its market contracts with clearing par ticipants","page_number":92,"box":{"x":69,"y":763,"width":822,"height":11}},{"id":"3e58d9bd-4475-4ec0-86a3-23adaec2178b","block_type":"box","text":"will be limited to assisting clearing par ticipants in pursuing their claims against CDCC or SCH. The Fund may suffer","page_number":92,"box":{"x":68,"y":778,"width":822,"height":11}},{"id":"e0c8dfb5-918f-4624-887d-d852be9a243c","block_type":"box","text":"delay in the recovery process or may not fully recover its losses from CDCC or SCH. In addition, as the relevant","page_number":92,"box":{"x":69,"y":793,"width":793,"height":11}},{"id":"11124d3e-1158-4a29-b750-0269a12327f9","block_type":"box","text":"filings, registration with the People’s Bank of China, and account opening have to be carried out by third par ties,","page_number":92,"box":{"x":68,"y":808,"width":802,"height":11}},{"id":"6a25eda5-4690-434e-8a09-acfdfd35762d","block_type":"box","text":"including CMU, CDCC, SCH, and CFETS, a Fund is subject to the risks of default or errors on the par t of such third","page_number":92,"box":{"x":70,"y":823,"width":812,"height":12}},{"id":"9d0c9329-458f-46cb-87a5-8aab3d1a88bb","block_type":"box","text":"par ties.","page_number":92,"box":{"x":70,"y":839,"width":52,"height":10}},{"id":"2d2a8fd5-9baf-4647-bedc-97042f5d9e11","block_type":"box","text":"The precise nature and rights of a Fund as the beneficial owner of the bonds traded in the China Interbank Bond","page_number":92,"box":{"x":101,"y":861,"width":799,"height":11}},{"id":"e61811e1-46f3-4ae8-aa7a-6adaf355abd8","block_type":"box","text":"Market through CMU as nominee is not well-defined under PRC law. There is a lack of a clear definition of, and","page_number":92,"box":{"x":70,"y":876,"width":785,"height":11}},{"id":"c1c6f5bf-ec5f-4c51-a88d-33a2060e7778","block_type":"box","text":"distinction between, legal ownership and beneficial ownership under PRC law and there have been few cases","page_number":92,"box":{"x":69,"y":891,"width":776,"height":12}},{"id":"90868eaf-b079-467e-b81d-a149d558af54","block_type":"box","text":"II-45","page_number":92,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"687293ef-b66c-4017-8db2-25820713c2f1","block_type":"box","text":"NM1026U-6033063-92/246","page_number":92,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"26fe2d3b-eb4a-4455-abc7-e28b88207eb9","block_type":"box","text":"involving a nominee account structure in the PRC cour ts. The exact nature and methods of enforcement of the rights","page_number":93,"box":{"x":70,"y":45,"width":830,"height":11}},{"id":"c7ad88ec-0b7f-45eb-af67-5181e261bdc3","block_type":"box","text":"and interests of a Fund under PRC law are also uncer tain.","page_number":93,"box":{"x":69,"y":60,"width":412,"height":9}},{"id":"7fab0f0b-17c2-41d8-825b-7ba5631bab7f","block_type":"box","text":"Market volatility and potential lack of liquidity due to low trading volume of cer tain bonds in the China Interbank","page_number":93,"box":{"x":102,"y":82,"width":793,"height":12}},{"id":"caa12df8-48c4-4ef3-ac2d-75ef79a3192e","block_type":"box","text":"Bond Market may result in prices of cer tain bonds traded on such market fluctuating significantly. A Fund investing in","page_number":93,"box":{"x":70,"y":98,"width":832,"height":11}},{"id":"e44ceab7-e638-4713-b8b6-e2b38638f518","block_type":"box","text":"such market is therefore subject to liquidity and volatility risks. The bid-ask spreads of the prices of such securities","page_number":93,"box":{"x":69,"y":113,"width":821,"height":11}},{"id":"2bb7bcd3-884a-45f0-b9d8-34410ec82ed6","block_type":"box","text":"may be large, and a Fund may therefore incur significant costs and may suffer losses when selling such investments.","page_number":93,"box":{"x":69,"y":128,"width":836,"height":11}},{"id":"46a3ce0e-6f70-4d31-a1a4-41de90d10caf","block_type":"box","text":"The bonds traded in the China Interbank Bond Market may be difficult or impossible to sell, which may impact a","page_number":93,"box":{"x":68,"y":143,"width":798,"height":11}},{"id":"82350e97-58e9-4421-a8bd-df65de88bcdf","block_type":"box","text":"Fund’s ability to acquire or dispose of such securities at their expected prices.","page_number":93,"box":{"x":70,"y":158,"width":556,"height":11}},{"id":"ffb940c3-c5d7-4370-b6cb-b7d8f4a787e9","block_type":"box","text":"Investing in the China Interbank Bond Market through Bond Connect is also subject to regulatory risks. The","page_number":93,"box":{"x":102,"y":181,"width":762,"height":11}},{"id":"8787d82e-dc8f-4c78-aa05-c133ce1b7a22","block_type":"box","text":"relevant rules and regulations are subject to change, which may have potential retrospective effect, and there can be","page_number":93,"box":{"x":69,"y":196,"width":835,"height":11}},{"id":"dbdee797-214b-4862-a5f1-f7998b6a56b4","block_type":"box","text":"no assurance that Bond Connect will not be discontinued or abolished. Fur thermore, the securities regimes and legal","page_number":93,"box":{"x":69,"y":211,"width":835,"height":11}},{"id":"501556df-5603-485b-96c3-d8f638f19fab","block_type":"box","text":"systems of China and Hong Kong differ significantly and issues may arise based on these differences. In the event","page_number":93,"box":{"x":69,"y":226,"width":820,"height":11}},{"id":"70a1a16c-7c59-40b0-a5d1-a0c2176599a5","block_type":"box","text":"that the relevant authorities suspend account opening or trading on the China Interbank Bond Market, a Fund’s ability","page_number":93,"box":{"x":68,"y":241,"width":840,"height":11}},{"id":"ecd9bfec-7184-410f-9014-46fafd4d695d","block_type":"box","text":"to invest in the China Interbank Bond Market will be adversely affected and limited. In such event, the Fund’s ability","page_number":93,"box":{"x":68,"y":256,"width":826,"height":11}},{"id":"74e03de2-0570-474a-ade4-4e6463095c10","block_type":"box","text":"to achieve its investment objective will be negatively affected and, after exhausting other trading alternatives, the","page_number":93,"box":{"x":68,"y":271,"width":808,"height":12}},{"id":"48c92668-2d78-4237-bd01-dd824221b812","block_type":"box","text":"Fund may suffer substantial losses as a result. Fur ther, if Bond Connect is not operating, a Fund may not be able to","page_number":93,"box":{"x":70,"y":286,"width":826,"height":12}},{"id":"47009192-ca36-4cfb-8c85-7c32ef66588c","block_type":"box","text":"acquire or dispose of bonds through Bond Connect in a timely manner, which could adversely affect the Fund’s","page_number":93,"box":{"x":69,"y":302,"width":789,"height":11}},{"id":"6c4c8b47-1f76-484b-98be-b9f73d1b6829","block_type":"box","text":"per formance.","page_number":93,"box":{"x":70,"y":317,"width":93,"height":11}},{"id":"75a91b6f-ff64-444d-b3ab-b17e02363f72","block_type":"box","text":"Trading through Bond Connect is per formed through newly developed trading platforms and operational systems.","page_number":93,"box":{"x":101,"y":339,"width":803,"height":12}},{"id":"11b22afa-f9a1-48b4-a6a2-79cf7b0cd0bd","block_type":"box","text":"There is no assurance that such systems will function properly or will continue to be adapted to changes and","page_number":93,"box":{"x":68,"y":355,"width":776,"height":11}},{"id":"0f324a13-ddee-4cc1-b6ad-a30a05dc7032","block_type":"box","text":"developments in the market. In the event that the relevant systems fail to function properly, trading through Bond","page_number":93,"box":{"x":69,"y":370,"width":806,"height":11}},{"id":"76e11457-cd1b-496f-8ac6-5eaff2a7b247","block_type":"box","text":"Connect may be disrupted. A Fund’s ability to trade through Bond Connect (and hence to pursue its investment","page_number":93,"box":{"x":69,"y":385,"width":791,"height":11}},{"id":"86818c55-804b-41dd-a747-acd59fadf95c","block_type":"box","text":"strategy) may therefore be adversely affected. In addition, where a Fund invests in the China Interbank Bond Market","page_number":93,"box":{"x":69,"y":400,"width":827,"height":11}},{"id":"dfb39feb-542b-4e6e-bb86-833458f7ecb2","block_type":"box","text":"through Bond Connect, it may be subject to risks of delays inherent in the order placing and/or settlement systems.","page_number":93,"box":{"x":68,"y":415,"width":827,"height":11}},{"id":"05936d93-20d2-4401-b68c-ac12b7673877","block_type":"box","text":"Bond Connect trades are settled in Chinese currency, the RMB, which is currently restricted and not freely","page_number":93,"box":{"x":102,"y":438,"width":755,"height":11}},{"id":"b3e40133-3074-43e5-a1f2-7de6db15d17e","block_type":"box","text":"conver tible. As a result, a Fund will be exposed to currency risk, and it cannot be guaranteed that investors will have","page_number":93,"box":{"x":69,"y":453,"width":830,"height":11}},{"id":"c8776fe5-7e4e-4675-956f-cda76baf025c","block_type":"box","text":"timely access to a reliable supply of RMB.","page_number":93,"box":{"x":68,"y":468,"width":298,"height":11}},{"id":"4ebc6b51-56e2-4d64-8b90-bffb603b7a56","block_type":"box","text":"Tax Risk – Withholding Income Tax Risk","page_number":93,"box":{"x":103,"y":491,"width":277,"height":11}},{"id":"c6ceda9e-d494-4008-90eb-bb3a7299c0aa","block_type":"box","text":".","page_number":93,"box":{"x":381,"y":498,"width":2,"height":2}},{"id":"d35b0b38-b879-434e-a58b-c99628eae9e6","block_type":"box","text":"According to PRC tax regulations, a 10% withholding income tax is imposed on PRC sourced dividends and","page_number":93,"box":{"x":101,"y":513,"width":758,"height":12}},{"id":"f2707785-8e46-49f8-8f65-b8a13d118c9d","block_type":"box","text":"interests from non-government bonds paid to a non-PRC tax resident enterprise, unless the rate is reduced under an","page_number":93,"box":{"x":70,"y":528,"width":828,"height":12}},{"id":"8b9077e6-dbd2-43e4-8018-33db17ff22d1","block_type":"box","text":"applicable tax treaty. From a technical perspective, withholding income tax is also applicable to capital gains realized","page_number":93,"box":{"x":69,"y":544,"width":831,"height":11}},{"id":"a5384389-5fac-4946-b8f7-d3c60e82ae6e","block_type":"box","text":"by foreign investors on the disposal of PRC equity interests.","page_number":93,"box":{"x":69,"y":559,"width":425,"height":11}},{"id":"8b12c8a5-48fc-4b12-b13e-5096db1c8efd","block_type":"box","text":"There are however cer tain tax exemptions available, some temporary in nature, highlighted below.","page_number":93,"box":{"x":101,"y":582,"width":697,"height":11}},{"id":"b2246f2b-d0a4-4b4d-8b1d-5af5988ee779","block_type":"box","text":"On November 14, 2014, the Ministry of Finance (“MoF”), China Securities Regulatory Commission and the State","page_number":93,"box":{"x":102,"y":604,"width":803,"height":11}},{"id":"55dd1a3d-bd41-4730-aa99-8194d452f469","block_type":"box","text":"Taxation Administration (“STA”), acting with State Council’s approval, jointly released Circular 79, which temporarily","page_number":93,"box":{"x":68,"y":619,"width":822,"height":11}},{"id":"1f7d3f35-16e2-45aa-b170-e939805cb12d","block_type":"box","text":"exempts Qualified Foreign Institutional Investors (“QFIIs”) and Renminbi Qualified Foreign Institutional Investors","page_number":93,"box":{"x":69,"y":634,"width":794,"height":12}},{"id":"020d8413-bfb3-41a5-8691-8bb15afab438","block_type":"box","text":"(“RQFIIs”) from tax on capital gains derived from the trading of shares and other equity interest investments on or","page_number":93,"box":{"x":69,"y":649,"width":812,"height":12}},{"id":"6a5fce95-44ff-4113-91d5-6ad4b5117b79","block_type":"box","text":"after November 17, 2014. Subsequently, Circulars 81 and 127 were issued to temporarily exempt tax on capital","page_number":93,"box":{"x":69,"y":664,"width":800,"height":12}},{"id":"3a2afe42-50fc-4050-8b82-ba5a06e1b9d0","block_type":"box","text":"gains derived from trading of equity securities of companies domiciled in the PRC that trade on Chinese stock","page_number":93,"box":{"x":68,"y":680,"width":783,"height":11}},{"id":"8eb3868f-8040-4be9-bd5c-a3b0a417975c","block_type":"box","text":"exchanges (“A-Shares”) through the Shanghai-Hong Kong Stock Connect program or the Shenzhen-Hong Kong Stock","page_number":93,"box":{"x":69,"y":695,"width":825,"height":11}},{"id":"77c683ac-07e9-4cfb-bbdc-25d04a38b8d5","block_type":"box","text":"Connect program, as applicable (each, a “Stock Connect” and collectively, “Stock Connects”). The duration of the","page_number":93,"box":{"x":69,"y":710,"width":809,"height":11}},{"id":"ea012698-21bb-4c3e-8552-e11d96bc927c","block_type":"box","text":"temporary exemptions is not stated in the circulars and is subject to termination by the PRC tax authorities with or","page_number":93,"box":{"x":68,"y":725,"width":818,"height":11}},{"id":"7f37fab7-7209-4bcb-b710-ae1673b11a62","block_type":"box","text":"without notice.","page_number":93,"box":{"x":68,"y":740,"width":103,"height":9}},{"id":"17411f83-92b3-4c90-8922-75cf15d9aeb0","block_type":"box","text":"On November 22, 2018, the MoF and STA jointly issued Circular 108 which states that foreign institutional","page_number":93,"box":{"x":102,"y":763,"width":759,"height":11}},{"id":"7ccac50e-39f2-495c-8de9-7b25057ca828","block_type":"box","text":"investors are temporarily exempt from withholding income tax with respect to interest income on bonds derived from","page_number":93,"box":{"x":70,"y":778,"width":827,"height":11}},{"id":"43e92ba0-4a80-4f61-a482-009109abb8a5","block_type":"box","text":"the PRC bond market from November 7, 2018 to November 6, 2021. On November 22, 2021, the MoF and STA","page_number":93,"box":{"x":68,"y":793,"width":798,"height":10}},{"id":"66d6def6-a6e0-4aae-a217-1cfdb9af4b49","block_type":"box","text":"issued Public Notice 34 to extend the temporary exemption from November 7, 2021 to December 31, 2025. On","page_number":93,"box":{"x":70,"y":808,"width":798,"height":11}},{"id":"cbf31ba5-8270-41f5-8196-e24b774d70f1","block_type":"box","text":"January 15, 2026, it was announced via Public Notice No. 5 of 2026 that the exemption was extended through","page_number":93,"box":{"x":69,"y":823,"width":792,"height":12}},{"id":"a472d6ea-a9e1-4386-9faa-0c65007ce165","block_type":"box","text":"December 31, 2027.","page_number":93,"box":{"x":70,"y":838,"width":147,"height":11}},{"id":"bb331a28-ebb3-452e-9b92-faf15a721f84","block_type":"box","text":"Value Added Tax (“VAT”) Risk —","page_number":93,"box":{"x":103,"y":861,"width":225,"height":11}},{"id":"57cb376b-3ca6-4b1e-a5d6-1b640f9ee69c","block_type":"box","text":"From May 1, 2016, VAT applies to cer tain income derived by the Fund, including","page_number":93,"box":{"x":333,"y":861,"width":569,"height":11}},{"id":"2cf422f1-3c61-4ea4-878a-497af11a41c4","block_type":"box","text":"PRC sourced interest income on non-government bonds and trading gains.","page_number":93,"box":{"x":69,"y":876,"width":528,"height":11}},{"id":"c82eb3af-2d7a-4b41-957b-d3a2cb39f54e","block_type":"box","text":"There are however cer tain tax exemptions available, some temporary in nature, highlighted below.","page_number":93,"box":{"x":101,"y":899,"width":697,"height":11}},{"id":"4784e99e-d6ec-4de0-b418-1f7ba6bd5b09","block_type":"box","text":"II-46","page_number":93,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"8d3e813b-99ad-4404-a07e-420971593bb4","block_type":"box","text":"NM1026U-6033063-93/246","page_number":93,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"5b65b5e3-77c1-48cd-9b4f-d71d5529102c","block_type":"box","text":"VAT exemptions currently apply to capital gains from trading of QFII and RQFII products, A-Shares traded on the","page_number":94,"box":{"x":101,"y":45,"width":789,"height":11}},{"id":"f7200ca8-7523-48f1-b5af-496f14e26e07","block_type":"box","text":"Stock Connects and debt securities traded in the China Interbank Bond Market.","page_number":94,"box":{"x":69,"y":60,"width":565,"height":9}},{"id":"fd6a326a-384d-40ee-aa81-168f12f0449f","block_type":"box","text":"On November 7, 2018, the MoF and STA jointly issued Circular 108 which states that foreign institutional","page_number":94,"box":{"x":102,"y":82,"width":749,"height":12}},{"id":"eb40d746-ebdf-4d88-b80e-4639fb8ae691","block_type":"box","text":"investors are temporarily exempt from VAT with respect to interest income on bonds derived from the PRC bond","page_number":94,"box":{"x":70,"y":98,"width":791,"height":11}},{"id":"2cb63d3f-78c6-43c9-8070-39f7dade9e37","block_type":"box","text":"market from November 7, 2018 to November 6, 2021. On November 22, 2021, the MoF and STA jointly issued Public","page_number":94,"box":{"x":69,"y":113,"width":840,"height":11}},{"id":"5c348333-dec4-4114-b05a-261869a30c1a","block_type":"box","text":"Notice 34 to extend the temporary exemption from November 7, 2021 to December 31, 2025. However, on","page_number":94,"box":{"x":70,"y":128,"width":766,"height":11}},{"id":"a174e7e0-1a32-48f3-8318-edf7856cbf23","block_type":"box","text":"July 31, 2025, the MoF and STA jointly issued Public Notice No 4 of 2025, stating that VAT will apply with respect to","page_number":94,"box":{"x":69,"y":143,"width":826,"height":11}},{"id":"64280bfe-cb41-404f-9e52-bf2936868ca4","block_type":"box","text":"interest income derived from treasury bonds, local government bonds and financial bonds issued on or after","page_number":94,"box":{"x":70,"y":158,"width":772,"height":11}},{"id":"2bee6280-55d8-4762-9b20-d8fe71d70dc1","block_type":"box","text":"August 8, 2025. It is understood that Public Notice No 4 of 2025 does not supersede the afore-mentioned exemption","page_number":94,"box":{"x":68,"y":173,"width":840,"height":11}},{"id":"5d80f3ec-59af-4306-a312-9b8a37450310","block_type":"box","text":"for foreign institutional investors. This exemption was extended through December 31, 2027.","page_number":94,"box":{"x":68,"y":188,"width":665,"height":12}},{"id":"ef200ea0-c9e3-4f8f-9bb1-fb61dd6be907","block_type":"box","text":"Any changes in PRC tax law, future clarifications thereof, and/or subsequent retroactive enforcement by the PRC","page_number":94,"box":{"x":101,"y":211,"width":801,"height":11}},{"id":"2dda0e7b-389a-4379-84a8-71f6b3ff294e","block_type":"box","text":"tax authorities may result in a loss which could be material to the Fund. There is a risk the PRC tax authorities may","page_number":94,"box":{"x":68,"y":226,"width":821,"height":11}},{"id":"7fc865cd-b063-494e-bf7f-1fee7766d466","block_type":"box","text":"withdraw the temporary tax exemptions in the future and seek to collect taxes realized on the sale of A-Shares or","page_number":94,"box":{"x":68,"y":241,"width":808,"height":11}},{"id":"0aecfcfe-f941-4aca-b78b-9e6c6b88ae51","block_type":"box","text":"PCR sourced interest income on non-government bonds received by the Fund without giving any prior notice. If the","page_number":94,"box":{"x":69,"y":256,"width":810,"height":12}},{"id":"a3285f23-6bb5-498f-a2e3-1e8bdfb9ae07","block_type":"box","text":"temporary tax exemptions are withdrawn, any taxes may be directly borne by or indirectly passed on to the Fund and","page_number":94,"box":{"x":68,"y":272,"width":829,"height":11}},{"id":"1dd8527d-4d0b-4b8c-b03e-71d0a3aa00eb","block_type":"box","text":"may result in a substantial impact to its net asset value. As with any net asset value adjustment, investors may be","page_number":94,"box":{"x":69,"y":287,"width":819,"height":11}},{"id":"9523a834-2b93-4721-9069-5c6706315c31","block_type":"box","text":"advantaged or disadvantaged depending on when the investors purchased and/or sold the shares of the Fund. There","page_number":94,"box":{"x":69,"y":302,"width":833,"height":11}},{"id":"21071a79-3425-4229-bf64-43326789688f","block_type":"box","text":"will be no retrospective restatement of the Fund’s net asset value.","page_number":94,"box":{"x":68,"y":317,"width":474,"height":11}},{"id":"ef6f7882-db4e-4038-aba5-2ea8ca03dbf0","block_type":"box","text":"BlackRock will keep the provisioning policy for tax liability under review and may, in its discretion from time to","page_number":94,"box":{"x":102,"y":339,"width":777,"height":12}},{"id":"af274ea0-459d-4fd1-8a9e-b3a31ebc692b","block_type":"box","text":"time, make a provision for potential tax liabilities if in its opinion such provision is warranted or as fur ther clarified by","page_number":94,"box":{"x":68,"y":355,"width":836,"height":11}},{"id":"ac11f68c-60da-40bb-9e4a-a3cc05356703","block_type":"box","text":"the PRC in notifications.","page_number":94,"box":{"x":68,"y":370,"width":171,"height":9}},{"id":"5929e72b-bbd9-452d-b887-72a5f6cce07b","block_type":"box","text":"Investment in Other Investment Companies.","page_number":94,"box":{"x":102,"y":392,"width":320,"height":11}},{"id":"5e84ec6a-01f2-4c44-8eb5-e5d1adac4f75","block_type":"box","text":"Each Fund may, subject to applicable law, invest in other","page_number":94,"box":{"x":429,"y":393,"width":402,"height":11}},{"id":"959190e3-fe4d-478a-9d12-cff191da7989","block_type":"box","text":"investment companies (including investment companies managed by BlackRock and its affiliates), including money","page_number":94,"box":{"x":70,"y":407,"width":818,"height":12}},{"id":"fd719734-b076-4891-87c1-d77a1ac07b04","block_type":"box","text":"market funds and ETFs, which are typically open-end funds or unit investment trusts listed on a stock exchange.","page_number":94,"box":{"x":69,"y":423,"width":797,"height":11}},{"id":"db8a7f51-ec1f-4539-bba3-af8414535595","block_type":"box","text":"Under Section 12(d)(1)(A) of the Investment Company Act, however, a Fund may invest up to 10% of its total assets","page_number":94,"box":{"x":70,"y":438,"width":822,"height":11}},{"id":"ee9f82a1-d364-468d-bd99-f336d907d85f","block_type":"box","text":"in securities of other investment companies (measured at the time of such investment). In addition, under Section","page_number":94,"box":{"x":70,"y":453,"width":814,"height":11}},{"id":"92fea1e9-e810-45e6-b6e3-9aebc5304273","block_type":"box","text":"12(d)(1)(A) of the Investment Company Act a Fund may not acquire securities of an investment company if such","page_number":94,"box":{"x":70,"y":468,"width":793,"height":11}},{"id":"278b826b-bf7e-4475-bb63-df0ed64f46b9","block_type":"box","text":"acquisition would cause the Fund to own more than 3% of the total outstanding voting stock of such investment","page_number":94,"box":{"x":69,"y":483,"width":796,"height":11}},{"id":"56be7164-ef36-4d1a-9e6e-e67ce7ef1141","block_type":"box","text":"company and a Fund may not invest in another investment company if such investment would cause more than 5% of","page_number":94,"box":{"x":69,"y":498,"width":837,"height":11}},{"id":"900d2831-63a1-4709-b43f-9a7609bbcad5","block_type":"box","text":"the value of the Fund’s total assets to be invested in securities of such investment company. (These limits do not","page_number":94,"box":{"x":68,"y":513,"width":812,"height":11}},{"id":"f9fd6ae6-a81a-461a-ac40-7234a0eee498","block_type":"box","text":"restrict a Feeder Fund from investing all of its assets in shares of its Master Por tfolio.) In addition to the restrictions","page_number":94,"box":{"x":69,"y":528,"width":829,"height":12}},{"id":"0d0aed7e-48b9-4ff4-92e1-24146939bc88","block_type":"box","text":"on investing in other investment companies discussed above, under Section 12(d)(1)(C) of the Investment Company","page_number":94,"box":{"x":69,"y":543,"width":827,"height":12}},{"id":"b09ab1dc-a773-4ff9-bb4d-2f12d825c066","block_type":"box","text":"Act a Fund may not invest in a registered closed-end investment company if such investment would cause the Fund","page_number":94,"box":{"x":68,"y":559,"width":821,"height":11}},{"id":"eb04d91c-d4d0-4960-97f1-cca96f51ecd0","block_type":"box","text":"and other BlackRock-advised investment companies to own more than 10% of the total outstanding voting stock of","page_number":94,"box":{"x":69,"y":574,"width":817,"height":11}},{"id":"2d854ae6-e66e-4897-8f07-ed4e170a6b21","block_type":"box","text":"such closed-end investment company. Pursuant to Section 12(d)(1)(G) of the Investment Company Act, these","page_number":94,"box":{"x":69,"y":589,"width":776,"height":11}},{"id":"22de9f17-fd78-4c1a-b9e4-fca89fdb2ce6","block_type":"box","text":"percentage limitations do not apply to investments in affiliated investment companies, including ETFs, subject to","page_number":94,"box":{"x":70,"y":604,"width":802,"height":11}},{"id":"1dbde69a-fd49-4791-9d01-cf30b90872ad","block_type":"box","text":"cer tain conditions. In addition, a Fund may be able to rely on cer tain rules under the Investment Company Act to","page_number":94,"box":{"x":69,"y":619,"width":801,"height":11}},{"id":"2478de25-71a3-44a0-ae7e-66d1c9588b8f","block_type":"box","text":"invest in shares of money market funds or other investment companies beyond the statutory limits noted above, but","page_number":94,"box":{"x":70,"y":634,"width":829,"height":11}},{"id":"612edc34-821f-4443-827e-c00789655ca8","block_type":"box","text":"subject to cer tain conditions.","page_number":94,"box":{"x":69,"y":650,"width":206,"height":10}},{"id":"24a34f80-1cc4-4b4b-ba41-736c22808759","block_type":"box","text":"As with other investments, investments in other investment companies are subject to market and selection risk.","page_number":94,"box":{"x":101,"y":672,"width":799,"height":11}},{"id":"a716ba12-d2c6-4dc0-86c6-da46e1f292e3","block_type":"box","text":"Shares of investment companies, such as closed-end fund investment companies, that trade on an exchange","page_number":94,"box":{"x":102,"y":695,"width":779,"height":11}},{"id":"5f877bf0-8068-4a3e-b297-c7472d155def","block_type":"box","text":"may at times be acquired at market prices representing premiums to their NAVs. In addition, investment companies","page_number":94,"box":{"x":69,"y":710,"width":824,"height":11}},{"id":"2b7b5ff7-0374-43f2-a5d0-e024bf5fac70","block_type":"box","text":"held by a Fund that trade on an exchange could trade at a discount from NAV, and such discount could increase while","page_number":94,"box":{"x":69,"y":725,"width":836,"height":11}},{"id":"714e2c4a-cd2c-4186-bd46-f6304403a26e","block_type":"box","text":"the Fund holds the shares. If the market price of shares of an exchange-traded investment company decreases below","page_number":94,"box":{"x":68,"y":740,"width":839,"height":11}},{"id":"6b9c8b43-0fae-4cec-a3e4-9ba841aefd32","block_type":"box","text":"the price that the Fund paid for the shares and the Fund were to sell its shares of such investment company at a","page_number":94,"box":{"x":68,"y":755,"width":806,"height":11}},{"id":"2da106b8-2d52-4e93-848d-efcc8fcd722f","block_type":"box","text":"time when the market price is lower than the price at which it purchased the shares, the Fund would experience a","page_number":94,"box":{"x":68,"y":771,"width":810,"height":10}},{"id":"fd54573a-e004-4d71-87f5-5185c5ffe65f","block_type":"box","text":"loss.","page_number":94,"box":{"x":70,"y":786,"width":31,"height":8}},{"id":"424ebdb3-fbe3-4207-a3cb-eb10a943a930","block_type":"box","text":"In addition, if a Fund acquires shares in investment companies, including affiliated investment companies,","page_number":94,"box":{"x":102,"y":808,"width":758,"height":11}},{"id":"993fa6cf-3d64-4288-91c8-1c8bbdc15814","block_type":"box","text":"shareholders would bear both their propor tionate share of expenses in the Fund and, indirectly, the expenses of such","page_number":94,"box":{"x":69,"y":823,"width":837,"height":11}},{"id":"a24fdcf7-8bb7-4d69-aef9-30d9748a4bf5","block_type":"box","text":"investment companies. Such expenses, both at the Fund level and acquired investment company level, would include","page_number":94,"box":{"x":70,"y":838,"width":835,"height":11}},{"id":"26890a33-1d7f-4dee-bd6d-56140571345d","block_type":"box","text":"management and advisory fees, unless such fees have been waived by BlackRock. Please see the relevant Fund’s","page_number":94,"box":{"x":69,"y":853,"width":816,"height":12}},{"id":"0be9666b-3646-4246-ad98-57898583e87c","block_type":"box","text":"Prospectus to determine whether any such management and advisory fees have been waived by BlackRock.","page_number":94,"box":{"x":69,"y":869,"width":768,"height":11}},{"id":"ee5dfba8-65e3-4667-82ce-11d923c81cb8","block_type":"box","text":"Investments by a Fund in wholly owned investment entities created under the laws of cer tain countries will not be","page_number":94,"box":{"x":70,"y":884,"width":807,"height":11}},{"id":"93555b1e-fdac-4d12-99e8-59f1d7973f9d","block_type":"box","text":"deemed an investment in other investment companies. Pursuant to guidance issued by the staff of the Commission,","page_number":94,"box":{"x":69,"y":899,"width":830,"height":11}},{"id":"a7fa78e9-9ae8-4bb4-984f-d521750e3053","block_type":"box","text":"II-47","page_number":94,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"f9e43971-373d-488b-9a8a-9639c3b2c42b","block_type":"box","text":"NM1026U-6033063-94/246","page_number":94,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"514a5e8d-443d-40e8-89d8-2205ad202afa","block_type":"box","text":"fees and expenses of money market funds used for the investment of cash collateral received in connection with","page_number":95,"box":{"x":68,"y":45,"width":804,"height":11}},{"id":"1ff97cd0-7238-41f1-b7dc-40c40990d9f3","block_type":"box","text":"loans of Fund securities are not treated as “acquired fund fees and expenses,” which are fees and expenses","page_number":95,"box":{"x":70,"y":60,"width":778,"height":11}},{"id":"956fe439-8010-4bbe-acc7-47183208ba10","block_type":"box","text":"charged by other investment companies and pooled investment vehicles in which a Fund invests a por tion of its","page_number":95,"box":{"x":69,"y":75,"width":796,"height":11}},{"id":"37ddbecc-9285-4fcc-99df-8d44e40da3db","block_type":"box","text":"assets.","page_number":95,"box":{"x":69,"y":91,"width":51,"height":8}},{"id":"3049850e-b857-4e4d-9d90-67f145ef88c7","block_type":"box","text":"To the extent shares of a Fund are held by another fund, the ability of the Fund itself to purchase other funds","page_number":95,"box":{"x":101,"y":113,"width":776,"height":11}},{"id":"4dc15ed2-c918-4117-b8dc-3dcdfb837a4d","block_type":"box","text":"may be limited. In addition, a fund-of-funds (","page_number":95,"box":{"x":69,"y":128,"width":313,"height":11}},{"id":"9c8af7af-ad17-43d2-87ae-5a1ab6974d9d","block_type":"box","text":"e.g.","page_number":95,"box":{"x":384,"y":129,"width":24,"height":10}},{"id":"f41a95ff-a1dc-4d9d-993c-8a360f9dee48","block_type":"box","text":", an investment company that seeks to meet its investment objective","page_number":95,"box":{"x":411,"y":128,"width":491,"height":11}},{"id":"1da96092-762f-4713-aac2-c0aab3a1b997","block_type":"box","text":"by investing significantly in other investment companies) may be limited in its ability to purchase underlying funds if","page_number":95,"box":{"x":69,"y":143,"width":823,"height":11}},{"id":"25915131-88a0-4453-81f1-def0bd9b1083","block_type":"box","text":"such underlying funds themselves own shares of underlying funds.","page_number":95,"box":{"x":69,"y":158,"width":472,"height":11}},{"id":"8dd8ca48-547f-44ef-bc2a-713a4146c315","block_type":"box","text":"A number of publicly traded closed-end investment companies have been organized to facilitate indirect foreign","page_number":95,"box":{"x":101,"y":181,"width":790,"height":11}},{"id":"1d8cf556-66b0-4181-ae95-3ba0c140c4d3","block_type":"box","text":"investment in developing countries, and cer tain of such countries, such as Thailand, South Korea, Chile and Brazil,","page_number":95,"box":{"x":70,"y":196,"width":818,"height":11}},{"id":"a38f6cb0-a5e3-42d8-82d3-6c9c545c060b","block_type":"box","text":"have specifically authorized such funds. There also are investment oppor tunities in cer tain of such countries in","page_number":95,"box":{"x":69,"y":211,"width":791,"height":11}},{"id":"095cab1b-b5da-47f0-9162-96eb135977d6","block_type":"box","text":"pooled vehicles that resemble open-end investment companies. The restrictions on investments in securities of","page_number":95,"box":{"x":70,"y":226,"width":795,"height":11}},{"id":"c6ab37b5-4c88-4827-90c4-ed8aed023092","block_type":"box","text":"investment companies set for th above may limit oppor tunities for a Fund to invest indirectly in cer tain developing","page_number":95,"box":{"x":70,"y":241,"width":807,"height":11}},{"id":"9fbd3aa7-ac7c-4378-8369-016b6d90ae17","block_type":"box","text":"countries.","page_number":95,"box":{"x":69,"y":257,"width":69,"height":8}},{"id":"5beadea2-0e4a-460f-9c28-cd03e9b16e7b","block_type":"box","text":"Issuer Insolvency Risk.","page_number":95,"box":{"x":102,"y":279,"width":166,"height":11}},{"id":"c62e886a-e046-42f5-86ff-a07a42490280","block_type":"box","text":"Cer tain Funds’ potential exposure to financially or operationally troubled issuers involves","page_number":95,"box":{"x":275,"y":279,"width":631,"height":11}},{"id":"50816474-d80d-4b0e-9487-a0dbefad9c26","block_type":"box","text":"a high degree of credit and market risk, which may be heightened during an economic downturn or recession. Should","page_number":95,"box":{"x":69,"y":294,"width":832,"height":11}},{"id":"d1f5c105-5e6e-4803-aefb-f65256462138","block_type":"box","text":"an issuer of securities held by a Fund become involved in a bankruptcy proceeding, reorganization or financial","page_number":95,"box":{"x":69,"y":309,"width":781,"height":11}},{"id":"b4ad5b64-0b91-4e7f-bd96-d77d109ba3f0","block_type":"box","text":"restructuring, a wide variety of considerations make an evaluation of the outcome of the Fund’s exposure to the","page_number":95,"box":{"x":69,"y":324,"width":797,"height":12}},{"id":"0a428362-9885-4c4b-850a-d23e9eaafa0e","block_type":"box","text":"issuer uncer tain.","page_number":95,"box":{"x":70,"y":340,"width":118,"height":8}},{"id":"d5957db2-1f8f-42d8-b630-38fd03adb24c","block_type":"box","text":"During the period of a bankruptcy proceeding, reorganization or financial restructuring, it is unlikely that a Fund","page_number":95,"box":{"x":102,"y":362,"width":788,"height":11}},{"id":"f3219f62-b050-4182-8a0a-c3452ec67ebf","block_type":"box","text":"will receive any interest payments on the securities of the issuer. A Fund will be subject to significant uncer tainty as","page_number":95,"box":{"x":68,"y":377,"width":827,"height":12}},{"id":"d8aee19b-e8eb-4ecc-afd7-585bf0eddabb","block_type":"box","text":"to whether the reorganization or restructuring will be completed, and the Fund may bear cer tain extraordinary","page_number":95,"box":{"x":68,"y":393,"width":779,"height":11}},{"id":"a547ac48-2f6e-418a-add0-e38e9cd91d67","block_type":"box","text":"expenses to protect and recover its investment. A Fund will also be subject to significant uncer tainty as to when and","page_number":95,"box":{"x":69,"y":407,"width":829,"height":12}},{"id":"54ab2ff5-8d19-4d5e-90e2-10477984ddd7","block_type":"box","text":"in what manner and for what value the obligations evidenced by the securities of the issuer held by the Fund will","page_number":95,"box":{"x":70,"y":423,"width":797,"height":11}},{"id":"0cbd56c4-f725-4310-b3f7-d88c454d1944","block_type":"box","text":"eventually be satisfied.","page_number":95,"box":{"x":69,"y":438,"width":162,"height":11}},{"id":"93f088c9-e28a-458a-93a8-47b7234fc251","block_type":"box","text":"Even if a plan of reorganization or restructuring is adopted with respect to the securities of the issuer held by the","page_number":95,"box":{"x":102,"y":460,"width":805,"height":12}},{"id":"e42a2021-e1d9-4f8a-9a5f-7553d17c87d5","block_type":"box","text":"Fund, there can be no assurance that the securities or other assets received by a Fund in connection with such plan","page_number":95,"box":{"x":70,"y":476,"width":827,"height":11}},{"id":"b570d835-816b-4e34-8c5d-b06c03ae79b4","block_type":"box","text":"of reorganization or restructuring will not have a lower value or income potential than may have been anticipated or","page_number":95,"box":{"x":69,"y":491,"width":819,"height":11}},{"id":"40353a63-675e-4b0b-84fa-9922f669fc99","block_type":"box","text":"no value. A Fund may be unable to enforce its claims or rights in any collateral or may have its claims or security","page_number":95,"box":{"x":69,"y":506,"width":802,"height":11}},{"id":"3aa1d7fc-12cc-439d-a4b5-39e81d28f6ee","block_type":"box","text":"interest in any collateral challenged, disallowed or subordinated to the claims or security interests of other creditors.","page_number":95,"box":{"x":70,"y":521,"width":830,"height":11}},{"id":"84eff7b5-f77a-4cc7-8272-7f1d6d6c306f","block_type":"box","text":"In addition, amendments to the U.S. Bankruptcy Code or other relevant laws could alter the expected outcome or","page_number":95,"box":{"x":70,"y":536,"width":805,"height":11}},{"id":"a05067d1-9fb9-46dc-933d-56fd0648aea7","block_type":"box","text":"introduce greater uncer tainty regarding the outcome of the Fund’s securities holdings in the issuer. In a bankruptcy","page_number":95,"box":{"x":70,"y":551,"width":820,"height":11}},{"id":"9f2fc06f-535f-476b-9c5b-63829ed8b562","block_type":"box","text":"proceeding, a reorganization or restructuring, the securities of the issuer held by a Fund could be re-characterized or","page_number":95,"box":{"x":70,"y":566,"width":828,"height":11}},{"id":"1221632f-91b5-4107-83f9-fb20932947b1","block_type":"box","text":"a Fund may receive different securities or other assets, including equity securities. These types of equity securities","page_number":95,"box":{"x":69,"y":581,"width":820,"height":12}},{"id":"3700a398-aa9a-492a-9201-4989348c785a","block_type":"box","text":"include, but are not limited to: common stock; preferred stock (including conver tible preferred stock); bonds, notes","page_number":95,"box":{"x":70,"y":596,"width":820,"height":12}},{"id":"aafda6c8-508b-4261-ad3d-1a52a473061f","block_type":"box","text":"and debentures conver tible into common or preferred stock; stock purchase warrants and rights; equity interests in","page_number":95,"box":{"x":69,"y":612,"width":824,"height":11}},{"id":"615bcf47-efe5-4ff5-88f4-16d07c323376","block_type":"box","text":"trusts; and depositary receipts. Equity securities are subject to changes in value, and their value may be more","page_number":95,"box":{"x":68,"y":627,"width":788,"height":11}},{"id":"d99fa4ec-3863-4590-a0f7-2329b37a27c1","block_type":"box","text":"volatile than those of other asset classes. Holders of equity securities are subject to more risk than holders of debt","page_number":95,"box":{"x":68,"y":642,"width":826,"height":11}},{"id":"2a81fdb2-bb26-48cb-af12-dd7520e070fb","block_type":"box","text":"securities because the status of equity holders is subordinate to debtholders in an issuer’s capital structure. The","page_number":95,"box":{"x":69,"y":657,"width":809,"height":11}},{"id":"efdefabe-7417-4f20-8136-7bde4b4e20ea","block_type":"box","text":"value of equity securities received by a Fund could decline if the financial condition of the issuer deteriorates or if","page_number":95,"box":{"x":68,"y":672,"width":809,"height":11}},{"id":"189ba10d-49a5-4cf9-9e00-7ecab762204a","block_type":"box","text":"overall market and economic conditions, or conditions within the issuer’s region or industry, deteriorate.","page_number":95,"box":{"x":69,"y":687,"width":741,"height":11}},{"id":"6236aea2-5c9d-4a6c-a61f-b54a3443c754","block_type":"box","text":"To the extent that a Fund receives other assets in connection with a bankruptcy proceeding, reorganization or","page_number":95,"box":{"x":101,"y":710,"width":780,"height":11}},{"id":"34595df5-8509-488d-aa55-3865adc98f2c","block_type":"box","text":"financial restructuring, the Fund may also be subject to additional risks associated with the assets received. One","page_number":95,"box":{"x":68,"y":725,"width":807,"height":11}},{"id":"0b1174fa-3401-411f-b81e-174041df5ecb","block_type":"box","text":"example of assets that a Fund could receive is an interest in one or more loans made to the issuer as par t of a","page_number":95,"box":{"x":69,"y":740,"width":795,"height":11}},{"id":"c63d2a9a-db5f-4655-a463-ee27b58f0531","block_type":"box","text":"workout agreed to by a consor tium of lienholders and creditors of the issuer. A Fund may receive such interests in","page_number":95,"box":{"x":68,"y":755,"width":814,"height":11}},{"id":"98615dea-ab7e-461d-82d2-b46fb0c7908d","block_type":"box","text":"loans to the extent permitted by the Investment Company Act.","page_number":95,"box":{"x":70,"y":770,"width":439,"height":11}},{"id":"f3578d9f-ce26-47d6-954c-e538d07f5247","block_type":"box","text":"Securities or other assets received in a reorganization or restructuring typically entail a higher degree of risk than","page_number":95,"box":{"x":102,"y":793,"width":806,"height":11}},{"id":"cea141ec-25bd-481a-aaef-0e4de7708e72","block_type":"box","text":"investments in securities of issuers that have not undergone a reorganization or restructuring and may be subject to","page_number":95,"box":{"x":70,"y":808,"width":829,"height":11}},{"id":"6a16177d-b56f-4579-90a6-49ed053be9f5","block_type":"box","text":"heavy selling or downward pricing pressure after completion of the reorganization or restructuring. The post","page_number":95,"box":{"x":69,"y":823,"width":767,"height":12}},{"id":"9ad67633-fe66-4273-9b6f-ef145387f6ff","block_type":"box","text":"reorganization/restructuring assets and securities may also be illiquid and difficult to sell or value. If a Fund","page_number":95,"box":{"x":69,"y":838,"width":771,"height":12}},{"id":"4a125a7e-b3d4-4fdb-8d40-28f79694cf72","block_type":"box","text":"par ticipates in negotiations with respect to a plan of reorganization or restructuring with respect to securities of the","page_number":95,"box":{"x":70,"y":853,"width":823,"height":12}},{"id":"35d03677-1991-4da9-af98-0077790d93d0","block_type":"box","text":"issuer held by a Fund, the Fund also may be restricted from disposing such securities for a period of time. If a Fund","page_number":95,"box":{"x":70,"y":869,"width":822,"height":11}},{"id":"76b13f56-bbf3-4e82-a387-0cf40f0780ec","block_type":"box","text":"becomes involved in such proceedings, the Fund may have more active par ticipation in the affairs of the issuer than","page_number":95,"box":{"x":69,"y":884,"width":828,"height":11}},{"id":"3ea95fdd-df65-4bf4-b5e1-9e189a22b5de","block_type":"box","text":"that assumed generally by an investor.","page_number":95,"box":{"x":68,"y":899,"width":274,"height":11}},{"id":"052f3bea-c98b-4d41-9d0d-f0ae30dac56f","block_type":"box","text":"II-48","page_number":95,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"1f03aa46-97d0-4a9e-ad10-933ca8cfdea8","block_type":"box","text":"NM1026U-6033063-95/246","page_number":95,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"dcc4bada-a0a2-4e70-b49a-ce0d819e8b39","block_type":"box","text":"Lease Obligations.","page_number":96,"box":{"x":102,"y":45,"width":133,"height":11}},{"id":"8dd6bd9e-e861-42a9-9c88-e075c14b6da1","block_type":"box","text":"A Fund may hold par ticipation cer tificates in a lease, an installment purchase contract, or a","page_number":96,"box":{"x":241,"y":45,"width":653,"height":11}},{"id":"a4c37a88-0e91-422b-b8d9-f4c12bc83d62","block_type":"box","text":"conditional sales contract (“lease obligations”). The Manager will monitor the credit standing of each borrower and","page_number":96,"box":{"x":69,"y":60,"width":816,"height":11}},{"id":"706391d3-4d69-42ec-9a8b-6eaf3c855b76","block_type":"box","text":"each entity providing credit suppor t and/or a put option relating to lease obligations.","page_number":96,"box":{"x":69,"y":75,"width":602,"height":11}},{"id":"7449bd72-d0f1-4bfc-a865-2bd5bfdda76f","block_type":"box","text":"Life Settlement Investments.","page_number":96,"box":{"x":102,"y":98,"width":210,"height":9}},{"id":"c95e086c-8e94-42f7-8326-53140df8b48d","block_type":"box","text":"A Fund may invest in life settlements, which are sales to third par ties, such as the","page_number":96,"box":{"x":318,"y":98,"width":589,"height":11}},{"id":"7af93da1-80e1-4a49-a7a7-cfb7cffa1017","block_type":"box","text":"Fund, of existing life insurance contracts for more than their cash surrender value but less than the net benefits to be","page_number":96,"box":{"x":70,"y":113,"width":838,"height":11}},{"id":"bf53bd0c-c8d5-464f-bf44-af83be897b1a","block_type":"box","text":"paid under the policies. When a Fund acquires such a contract, it pays the policy premiums in return for the expected","page_number":96,"box":{"x":70,"y":128,"width":834,"height":11}},{"id":"d7c7d326-7ab9-435c-a2d3-96bfdf209624","block_type":"box","text":"receipt of the net benefit as the beneficiary under the policy. Investments in these contracts involve cer tain risks,","page_number":96,"box":{"x":69,"y":143,"width":808,"height":11}},{"id":"319a24c2-dea7-4507-b53e-996722b3109f","block_type":"box","text":"including liquidity risk, credit risk of the insurance company, and inaccurate estimations of life expectancy of the","page_number":96,"box":{"x":70,"y":158,"width":797,"height":11}},{"id":"81862863-231f-4964-9981-f94801cc971e","block_type":"box","text":"insured individuals (viators). These policies may be considered illiquid because they are bought and sold in a","page_number":96,"box":{"x":70,"y":173,"width":775,"height":11}},{"id":"2d0f671f-a2bb-4b5f-9275-bc58ba90a3b1","block_type":"box","text":"secondary market through life settlement agents. Also, in the event of a bankruptcy of the insurance carrier for a","page_number":96,"box":{"x":69,"y":188,"width":805,"height":12}},{"id":"4e0e33e1-4d8c-4a54-90ed-6d9a77b7ada2","block_type":"box","text":"policy, the Fund may receive reduced or no benefits under the contract. A Fund seeks to minimize credit risk by","page_number":96,"box":{"x":70,"y":203,"width":789,"height":12}},{"id":"de100838-d075-4261-9646-53181debdd43","block_type":"box","text":"investing in policies issued by a diverse range of highly-rated insurance carriers. Fur thermore, a Fund may encounter","page_number":96,"box":{"x":70,"y":218,"width":829,"height":12}},{"id":"ba9fee37-995d-4dc4-b06c-6ef2b1bf1719","block_type":"box","text":"losses on its investments if there is an inaccurate estimation of the life expectancies of viators. A Fund intends to","page_number":96,"box":{"x":70,"y":234,"width":813,"height":11}},{"id":"e7f7665f-8d47-4bff-88c7-af55dc1a5168","block_type":"box","text":"reduce this life expectancy risk by investing only in contracts where the life expectancy was reviewed by an","page_number":96,"box":{"x":69,"y":249,"width":758,"height":11}},{"id":"e965c6a0-fa9b-40eb-adf9-479b44b60235","block_type":"box","text":"experienced actuary, as well as by diversifying its investments across viators of varying ages and medical profiles. In","page_number":96,"box":{"x":69,"y":264,"width":832,"height":11}},{"id":"672893ba-19de-4d6e-99c8-2e49c5702851","block_type":"box","text":"addition, it is unclear whether the income from life settlements is qualifying income for purposes of the IRS 90%","page_number":96,"box":{"x":69,"y":279,"width":800,"height":11}},{"id":"e514b44a-515c-4611-9d08-d5f3fca80f7d","block_type":"box","text":"gross income test a Fund must satisfy each year to qualify as a regulated investment company. A Fund intends to","page_number":96,"box":{"x":68,"y":294,"width":809,"height":11}},{"id":"bb51d8be-a7dd-4da9-88a9-ef2584e4157f","block_type":"box","text":"monitor its investments to ensure that the Fund remains qualified as a regulated investment company.","page_number":96,"box":{"x":69,"y":309,"width":730,"height":11}},{"id":"ffa83770-b298-4808-93ec-805da273f32e","block_type":"box","text":"Liquidity Risk Management.","page_number":96,"box":{"x":102,"y":332,"width":202,"height":11}},{"id":"a958fc26-0c40-4946-a0c7-4a72bda28f04","block_type":"box","text":"Rule 22e-4 under the Investment Company Act (the “Liquidity Rule”) requires open","page_number":96,"box":{"x":311,"y":332,"width":591,"height":11}},{"id":"b182ec6e-1e45-4787-b7da-0718c02ac2bf","block_type":"box","text":"end funds, such as the Funds, to adopt a liquidity risk management program and enhance disclosures regarding fund","page_number":96,"box":{"x":69,"y":347,"width":835,"height":11}},{"id":"a9e69d37-465f-4ccb-a5d5-89ce2bb2cad2","block_type":"box","text":"liquidity. As required by the Liquidity Rule, the Funds have implemented a liquidity risk management program (the","page_number":96,"box":{"x":70,"y":362,"width":803,"height":11}},{"id":"8c9d6912-ff37-4787-a438-b02cbec296f0","block_type":"box","text":"“Liquidity Program”), and the Boards of Directors of the Funds, including a majority of the independent Directors,","page_number":96,"box":{"x":70,"y":377,"width":801,"height":12}},{"id":"6060418f-c3c5-4c14-9210-688e1adebc4d","block_type":"box","text":"have appointed the Manager as the liquidity risk program administrator of the Liquidity Program. Under the Liquidity","page_number":96,"box":{"x":69,"y":392,"width":822,"height":12}},{"id":"a78f4aa4-dbe2-4431-bd08-17a62bf56ae7","block_type":"box","text":"Program, the Manager assesses, manages, and periodically reviews each Fund’s liquidity risk and classifies each","page_number":96,"box":{"x":69,"y":407,"width":808,"height":12}},{"id":"31a75020-240a-4609-8aad-113b0b4562fe","block_type":"box","text":"investment held by a Fund as a “highly liquid investment,” “moderately liquid investment,” “less liquid investment” or","page_number":96,"box":{"x":70,"y":423,"width":838,"height":11}},{"id":"4361bac5-cd02-4e1a-9a34-5f4f6633a596","block_type":"box","text":"“illiquid investment.” The Liquidity Rule defines “liquidity risk” as the risk that a Fund could not meet requests to","page_number":96,"box":{"x":70,"y":438,"width":804,"height":11}},{"id":"bf980069-145c-4461-9eef-be2a02bda7f0","block_type":"box","text":"redeem shares issued by the Fund without significant dilution of the remaining investors’ interests in the Fund. The","page_number":96,"box":{"x":69,"y":453,"width":821,"height":11}},{"id":"189c1d1c-e476-46c1-ae9f-6baaa82d4b7f","block_type":"box","text":"liquidity of a Fund’s por tfolio investments is determined based on relevant market, trading and investment-specific","page_number":96,"box":{"x":70,"y":468,"width":815,"height":11}},{"id":"7f5fe42b-b370-472a-b0b6-aa936d08c87e","block_type":"box","text":"considerations under the Liquidity Program. To the extent that an investment is deemed to be an illiquid investment","page_number":96,"box":{"x":69,"y":483,"width":823,"height":11}},{"id":"ef4a0613-d1fa-4c35-b53e-8b737a8fb004","block_type":"box","text":"or a less liquid investment, a Fund can expect to be exposed to greater liquidity risk.","page_number":96,"box":{"x":69,"y":498,"width":601,"height":11}},{"id":"36b38a34-8af4-48b4-886e-9d2009f1a6c9","block_type":"box","text":"Master Limited Partnerships.","page_number":96,"box":{"x":102,"y":521,"width":211,"height":11}},{"id":"893d5b83-07cb-4474-a530-1fbb5c8232a5","block_type":"box","text":"Cer tain Funds may invest in publicly traded master limited par tnerships (“MLPs”)","page_number":96,"box":{"x":320,"y":521,"width":577,"height":11}},{"id":"96cad939-b6cc-43cf-b4e1-52ad83860f57","block_type":"box","text":"which are limited par tnerships or limited liability companies taxable as par tnerships. MLPs may derive income and","page_number":96,"box":{"x":68,"y":536,"width":816,"height":11}},{"id":"a9911b89-0205-472d-b67f-09d27d0a0a2f","block_type":"box","text":"gains from the exploration, development, mining or production, processing, refining, transpor tation (including","page_number":96,"box":{"x":68,"y":551,"width":777,"height":11}},{"id":"20515e30-4dbf-4508-9f91-d579dcba2f7d","block_type":"box","text":"pipelines transpor ting gas, oil, or products thereof), or the marketing of any mineral or natural resources. MLPs","page_number":96,"box":{"x":70,"y":566,"width":792,"height":11}},{"id":"a229fe00-3ce5-4783-9661-7e3913a8bcc9","block_type":"box","text":"generally have two classes of owners, the general par tner and limited par tners. When investing in an MLP, a Fund","page_number":96,"box":{"x":68,"y":581,"width":811,"height":12}},{"id":"3e8f4f3a-08df-4cac-8faa-afa9299219d0","block_type":"box","text":"intends to purchase publicly traded common units issued to limited par tners of the MLP. The general par tner is","page_number":96,"box":{"x":70,"y":596,"width":791,"height":12}},{"id":"4d9bda36-2ea4-4ba4-9114-2b78c9f48d0c","block_type":"box","text":"typically owned by a major energy company, an investment fund, the direct management of the MLP or is an entity","page_number":96,"box":{"x":68,"y":612,"width":812,"height":11}},{"id":"fc3631e8-466f-4106-9f14-375246af163e","block_type":"box","text":"owned by one or more of such par ties. The general par tner may be structured as a private or publicly traded","page_number":96,"box":{"x":69,"y":627,"width":770,"height":11}},{"id":"525984d1-cbad-4e9e-baec-d46d972f8ad9","block_type":"box","text":"corporation or other entity. The general par tner typically controls the operations and management of the MLP through","page_number":96,"box":{"x":69,"y":642,"width":833,"height":11}},{"id":"7c6957f1-b9d2-46ec-8135-6d4cb3abd5bf","block_type":"box","text":"an up to 2% equity interest in the MLP plus, in many cases, ownership of common units and subordinated units.","page_number":96,"box":{"x":69,"y":657,"width":799,"height":11}},{"id":"0c2c5faf-7a0d-4c02-9b3a-24e60083f297","block_type":"box","text":"Limited par tners own the remainder of the par tnership, through ownership of common units, and have a limited role","page_number":96,"box":{"x":70,"y":672,"width":825,"height":11}},{"id":"2f3bbd17-6dc6-4e48-85db-7780126237e7","block_type":"box","text":"in the par tnership’s operations and management.","page_number":96,"box":{"x":70,"y":687,"width":352,"height":11}},{"id":"79050b0a-54eb-4266-9b90-126277696041","block_type":"box","text":"MLPs are typically structured such that common units and general par tner interests have first priority to receive","page_number":96,"box":{"x":102,"y":710,"width":794,"height":11}},{"id":"bd675347-d297-4f04-ba76-94541a8bf864","block_type":"box","text":"quar terly cash distributions up to an established minimum amount (“minimum quar terly distributions” or “MQD”).","page_number":96,"box":{"x":69,"y":725,"width":809,"height":11}},{"id":"3cfb95f7-1be2-4f09-be2b-60b9699b6166","block_type":"box","text":"Common and general par tner interests also accrue arrearages in distributions to the extent the MQD is not paid.","page_number":96,"box":{"x":69,"y":740,"width":804,"height":11}},{"id":"28d4ecb8-3df7-4162-9abf-031714299b26","block_type":"box","text":"Once common and general par tner interests have been paid, subordinated units receive distributions of up to the","page_number":96,"box":{"x":69,"y":755,"width":808,"height":11}},{"id":"167de825-8ebb-4793-a883-ac7a0f06fecf","block_type":"box","text":"MQD; however, subordinated units do not accrue arrearages. Distributable cash in excess of the MQD paid to both","page_number":96,"box":{"x":70,"y":770,"width":816,"height":12}},{"id":"09de1a32-786a-4022-b6d9-35b3adf37e4a","block_type":"box","text":"common and subordinated units is distributed to both common and subordinated units generally on a pro rata basis.","page_number":96,"box":{"x":69,"y":786,"width":831,"height":11}},{"id":"b0fbe551-709d-41dd-a94d-2610e224c2dd","block_type":"box","text":"The general par tner is also eligible to receive incentive distributions if the general par tner operates the business in a","page_number":96,"box":{"x":68,"y":801,"width":835,"height":11}},{"id":"54eb8686-c618-4374-85ec-e92223305552","block_type":"box","text":"manner which results in distributions paid per common unit surpassing specified target levels. As the general par tner","page_number":96,"box":{"x":69,"y":816,"width":838,"height":11}},{"id":"3cce25a2-308d-45f1-b636-d07c8753d5c1","block_type":"box","text":"increases cash distributions to the limited par tners, the general par tner receives an increasingly higher percentage of","page_number":96,"box":{"x":70,"y":831,"width":839,"height":11}},{"id":"eda12ad5-f908-46f9-b536-01648ecad63c","block_type":"box","text":"the incremental cash distributions. A common arrangement provides that the general par tner can reach a tier where","page_number":96,"box":{"x":68,"y":846,"width":828,"height":11}},{"id":"feb6b2ce-b508-4063-8990-29bbcd390937","block_type":"box","text":"it receives 50% of every incremental dollar paid to common and subordinated unit holders. These incentive","page_number":96,"box":{"x":70,"y":861,"width":761,"height":11}},{"id":"10b36b04-41f8-47bd-8862-4360a65b6680","block_type":"box","text":"distributions encourage the general par tner to streamline costs, increase capital expenditures and acquire assets in","page_number":96,"box":{"x":69,"y":876,"width":830,"height":11}},{"id":"b70e295a-cbf2-4b05-b9b2-dd75768a47d3","block_type":"box","text":"order to increase the par tnership’s cash flow and raise the quar terly cash distribution in order to reach higher tiers.","page_number":96,"box":{"x":69,"y":891,"width":824,"height":12}},{"id":"0406e5b5-119a-4915-8c7a-541249f733a3","block_type":"box","text":"Such results benefit all security holders of the MLP.","page_number":96,"box":{"x":69,"y":906,"width":366,"height":12}},{"id":"735b0e95-8cc8-4b17-9311-4239af2a4c7a","block_type":"box","text":"II-49","page_number":96,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"00d66545-82d7-4853-b846-ad6b91168128","block_type":"box","text":"NM1026U-6033063-96/246","page_number":96,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"29ac3e66-baa8-410f-8db7-f69c7149ba32","block_type":"box","text":"MLP common units represent a limited par tnership interest in the MLP. Common units are listed and traded on","page_number":97,"box":{"x":102,"y":45,"width":790,"height":11}},{"id":"93218f86-d7cc-4e71-b876-0f871ccf2ed7","block_type":"box","text":"U.S. securities exchanges, with their value fluctuating predominantly based on prevailing market conditions and the","page_number":97,"box":{"x":70,"y":60,"width":820,"height":11}},{"id":"4db4b459-d99e-4536-a859-166b076ba876","block_type":"box","text":"success of the MLP. Cer tain Funds intend to purchase common units in market transactions. Unlike owners of","page_number":97,"box":{"x":69,"y":75,"width":787,"height":11}},{"id":"b85a60f4-b284-4b87-ac98-d6d03908c018","block_type":"box","text":"common stock of a corporation, owners of common units have limited voting rights and have no ability to annually","page_number":97,"box":{"x":69,"y":90,"width":810,"height":11}},{"id":"0a1398b1-ff25-4108-b338-5e1ede967737","block_type":"box","text":"elect directors. In the event of liquidation, common units have preference over subordinated units, but not over debt","page_number":97,"box":{"x":69,"y":105,"width":828,"height":11}},{"id":"1d242faf-dc2b-4aa5-8b90-4f92c3716ed1","block_type":"box","text":"or preferred units, to the remaining assets of the MLP.","page_number":97,"box":{"x":69,"y":120,"width":387,"height":12}},{"id":"3b9f3dc5-0b2a-4a33-bc5c-83412e4b9d00","block_type":"box","text":"Merger Transaction Risk.","page_number":97,"box":{"x":102,"y":143,"width":183,"height":11}},{"id":"3359e34d-ff99-42f7-adda-e8e6d1355b60","block_type":"box","text":"A Fund may buy stock of the target company in an announced merger transaction prior","page_number":97,"box":{"x":291,"y":143,"width":616,"height":11}},{"id":"92fb234c-b59e-4b2b-9c28-b44bb5379c3d","block_type":"box","text":"to the consummation of such transaction. In that circumstance, a Fund would expect to receive an amount (whether","page_number":97,"box":{"x":68,"y":158,"width":827,"height":11}},{"id":"c9de7b1a-87e8-477b-845b-ba75296c4ffd","block_type":"box","text":"in cash, stock of the acquiring company or a combination of both) in excess of the purchase price paid by the Fund","page_number":97,"box":{"x":70,"y":173,"width":816,"height":11}},{"id":"559470c8-7c4a-40a0-9ec6-e9b70325a7a2","block_type":"box","text":"for the target company’s stock. However, a Fund is subject to the risk that the merger transaction may be canceled,","page_number":97,"box":{"x":68,"y":188,"width":825,"height":12}},{"id":"9245beda-b24d-475d-91f0-024cb5ccb3f6","block_type":"box","text":"delayed or restructured, in which case a Fund’s holding of the target company’s stock may not result in any profit for","page_number":97,"box":{"x":69,"y":203,"width":832,"height":12}},{"id":"9bca9bba-f81d-4317-9451-d3aa8986ffc0","block_type":"box","text":"the Fund and may lose significant value.","page_number":97,"box":{"x":68,"y":218,"width":286,"height":12}},{"id":"2e16dde3-69df-4ed7-b278-00ef2e1de7c9","block_type":"box","text":"Money Market Obligations of Domestic Banks, Foreign Banks and Foreign Branches of U.S. Banks.","page_number":97,"box":{"x":102,"y":241,"width":723,"height":11}},{"id":"c9981fcc-382a-4b30-8fb5-4d8f89eb54dc","block_type":"box","text":"Cer tain","page_number":97,"box":{"x":831,"y":241,"width":50,"height":9}},{"id":"bee9216d-f39d-42bb-9219-e2e9ddf66a05","block_type":"box","text":"Funds may purchase bank obligations, such as cer tificates of deposit, notes, bankers’ acceptances and time","page_number":97,"box":{"x":70,"y":256,"width":778,"height":12}},{"id":"01db11fa-69e6-48ca-b42b-b2d5c1be968a","block_type":"box","text":"deposits, including instruments issued or suppor ted by the credit of U.S. or foreign banks or savings institutions","page_number":97,"box":{"x":69,"y":271,"width":802,"height":12}},{"id":"bdd34947-0ce1-4978-bb2e-c1b074d15005","block_type":"box","text":"having total assets at the time of purchase in excess of $1 billion. These obligations may be general obligations of","page_number":97,"box":{"x":69,"y":286,"width":820,"height":12}},{"id":"b2508780-daea-4523-b216-14bf68bd34c6","block_type":"box","text":"the parent bank or may be limited to the issuing branch or subsidiary by the terms of a specific obligation or by","page_number":97,"box":{"x":68,"y":302,"width":794,"height":11}},{"id":"8178d167-d5fe-4ab4-8ed1-48c65836255f","block_type":"box","text":"government regulation. The assets of a bank or savings institution will be deemed to include the assets of its","page_number":97,"box":{"x":68,"y":317,"width":781,"height":11}},{"id":"e34d1da9-228f-45e0-8291-a9db28057939","block_type":"box","text":"domestic and foreign branches for purposes of a Fund’s investment policies. Investments in shor t-term bank","page_number":97,"box":{"x":69,"y":332,"width":776,"height":11}},{"id":"067c0341-cb19-4932-ab3e-79a05b0ca8e2","block_type":"box","text":"obligations may include obligations of foreign banks and domestic branches of foreign banks, and also foreign","page_number":97,"box":{"x":69,"y":347,"width":785,"height":11}},{"id":"858264fb-5222-4581-bdce-04a1ca27f809","block_type":"box","text":"branches of domestic banks.","page_number":97,"box":{"x":69,"y":362,"width":205,"height":9}},{"id":"dfe74a82-2561-4732-a02c-65743c66e509","block_type":"box","text":"To the extent consistent with their investment objectives, a Fund may invest in debt obligations of domestic or","page_number":97,"box":{"x":101,"y":385,"width":785,"height":11}},{"id":"345c69a0-8416-472a-872a-676946e7bae0","block_type":"box","text":"foreign corporations and banks, and may acquire commercial obligations issued by Canadian corporations and","page_number":97,"box":{"x":68,"y":400,"width":787,"height":11}},{"id":"0a5aa119-9b7c-4602-9ac2-23472829f9bc","block_type":"box","text":"Canadian counterpar ts of U.S. corporations, as well as Europaper, which is U.S. dollar-denominated commercial","page_number":97,"box":{"x":69,"y":415,"width":797,"height":11}},{"id":"9b39751f-842b-4d46-bb3c-b70c172dd87e","block_type":"box","text":"paper of a foreign issuer.","page_number":97,"box":{"x":70,"y":430,"width":176,"height":11}},{"id":"ad25a228-25d4-4824-9a79-ec313c9c8598","block_type":"box","text":"Money Market Securities.","page_number":97,"box":{"x":102,"y":453,"width":188,"height":11}},{"id":"8bbc9cf7-bbdb-466b-ac97-fb01ffe01364","block_type":"box","text":"Cer tain Funds may invest in a broad range of shor t-term, high quality, U.S. dollar","page_number":97,"box":{"x":296,"y":453,"width":578,"height":11}},{"id":"08625e80-911e-4ef9-b2ad-8e49c9a482aa","block_type":"box","text":"denominated instruments, such as government, bank, commercial and other obligations that are available in the","page_number":97,"box":{"x":69,"y":468,"width":802,"height":11}},{"id":"c869c22d-4625-4654-9372-4943e93aa811","block_type":"box","text":"money markets. In par ticular, the Funds may invest in:","page_number":97,"box":{"x":69,"y":483,"width":386,"height":11}},{"id":"2e097e07-4fe4-4ae1-a81e-d077dce50cac","block_type":"box","text":"(a) U.S. dollar-denominated obligations issued or suppor ted by the credit of U.S. or foreign banks or savings","page_number":97,"box":{"x":69,"y":503,"width":779,"height":12}},{"id":"b1e79a6a-54f2-446f-b622-940affeb39b7","block_type":"box","text":"institutions with total assets in excess of $1 billion (including obligations of foreign branches of such banks);","page_number":97,"box":{"x":102,"y":518,"width":776,"height":12}},{"id":"4d9130b6-d251-411f-82ee-0803b48551ed","block_type":"box","text":"(b) high quality commercial paper and other obligations issued or guaranteed by U.S. and foreign corporations and","page_number":97,"box":{"x":69,"y":538,"width":821,"height":12}},{"id":"5cb1e5ff-1824-45e3-98bc-32852226f515","block_type":"box","text":"other issuers rated (at the time of purchase) A-2 or higher by S&P, Prime-2 or higher by Moody’s or F-2 or higher","page_number":97,"box":{"x":102,"y":554,"width":795,"height":11}},{"id":"5a597909-03e1-4a85-abf3-41fe5f2ca402","block_type":"box","text":"by Fitch, as well as high quality corporate bonds rated (at the time of purchase) A or higher by those rating","page_number":97,"box":{"x":102,"y":569,"width":757,"height":11}},{"id":"f5d80ef8-a476-4acf-b79d-55c3557fc44a","block_type":"box","text":"agencies;","page_number":97,"box":{"x":102,"y":584,"width":66,"height":11}},{"id":"2c367964-b4f3-4e23-9757-ffd685da39e4","block_type":"box","text":"(c) unrated notes, paper and other instruments that are of comparable quality to the instruments described in","page_number":97,"box":{"x":69,"y":604,"width":792,"height":11}},{"id":"341c65ea-010c-4bf1-b7f6-c2f8db6d60e4","block_type":"box","text":"(b) above as determined by the Fund’s Manager;","page_number":97,"box":{"x":102,"y":619,"width":344,"height":11}},{"id":"c2dccdc4-e524-4be8-9c23-0887487f5a90","block_type":"box","text":"(d) asset-backed securities (including interests in pools of assets such as mor tgages, installment purchase","page_number":97,"box":{"x":69,"y":639,"width":776,"height":12}},{"id":"5a450a31-eb71-4224-869b-f23e77cb8e2c","block_type":"box","text":"obligations and credit card receivables);","page_number":97,"box":{"x":102,"y":655,"width":283,"height":11}},{"id":"ccb308ec-fe99-482a-b1e4-77b539be7b14","block_type":"box","text":"(e) securities issued or guaranteed as to principal and interest by the U.S. Government or by its agencies or","page_number":97,"box":{"x":69,"y":675,"width":778,"height":11}},{"id":"21f458b4-f885-49d6-9b3f-428f0a24f09e","block_type":"box","text":"authorities and related custodial receipts;","page_number":97,"box":{"x":102,"y":690,"width":296,"height":11}},{"id":"8afba94a-53ea-4c2b-9414-12cd76c90bdd","block_type":"box","text":"(f) dollar-denominated securities issued or guaranteed by foreign governments or their political subdivisions,","page_number":97,"box":{"x":69,"y":710,"width":782,"height":11}},{"id":"b4ba2c8d-17f4-49a1-94f1-a893b6247ede","block_type":"box","text":"agencies or authorities;","page_number":97,"box":{"x":102,"y":725,"width":166,"height":11}},{"id":"1ec92a29-afe8-422f-8200-2824f3793c2c","block_type":"box","text":"(g) funding agreements issued by highly-rated U.S. insurance companies;","page_number":97,"box":{"x":69,"y":745,"width":528,"height":11}},{"id":"2273fe69-17a1-41e6-8716-0ccacdfced50","block_type":"box","text":"(h) securities issued or guaranteed by state or local governmental bodies;","page_number":97,"box":{"x":69,"y":766,"width":534,"height":11}},{"id":"9f5bc429-1ff3-45f1-8169-e56f8b8926df","block_type":"box","text":"(i) repurchase agreements relating to the above instruments;","page_number":97,"box":{"x":69,"y":786,"width":447,"height":11}},{"id":"380dfb8c-18b0-4204-8e32-5a071299f0a0","block_type":"box","text":"(j) municipal bonds and notes whose principal and interest payments are guaranteed by the U.S. Government or","page_number":97,"box":{"x":69,"y":806,"width":812,"height":11}},{"id":"72916c25-a8c2-4836-9f0f-a4b1d5be0452","block_type":"box","text":"one of its agencies or authorities or which otherwise depend directly or indirectly on the credit of the United","page_number":97,"box":{"x":102,"y":821,"width":766,"height":11}},{"id":"eee7b4b2-55e4-4aa2-b810-55155322d2b0","block_type":"box","text":"States;","page_number":97,"box":{"x":102,"y":836,"width":49,"height":10}},{"id":"dfd0dcc2-6eed-4abe-9365-10e12f5068ad","block_type":"box","text":"(k) fixed and variable rate notes and similar debt instruments rated MIG-2, VMIG-2 or Prime-2 or higher by Moody’s,","page_number":97,"box":{"x":69,"y":856,"width":829,"height":11}},{"id":"32438de2-208f-4ae4-a60a-a8cc7825acc7","block_type":"box","text":"SP-2 or A-2 or higher by S&P, or F-2 or higher by Fitch;","page_number":97,"box":{"x":102,"y":871,"width":379,"height":11}},{"id":"8eef4cfc-1781-4ca3-9c00-24ddeaab388f","block_type":"box","text":"(l) tax-exempt commercial paper and similar debt instruments rated Prime-2 or higher by Moody’s, A-2 or higher by","page_number":97,"box":{"x":69,"y":891,"width":826,"height":12}},{"id":"9bb78b44-7ccc-4a17-817a-3a6315bac508","block_type":"box","text":"S&P, or F-2 or higher by Fitch;","page_number":97,"box":{"x":102,"y":906,"width":207,"height":12}},{"id":"41a6224d-b8ab-421f-bf3e-020f6cd9ddee","block_type":"box","text":"II-50","page_number":97,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"92479e57-691a-4b5c-b013-c16add20177b","block_type":"box","text":"NM1026U-6033063-97/246","page_number":97,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"41d64ac3-4f64-4380-9635-2222d58cd01e","block_type":"box","text":"(m) municipal bonds rated A or higher by Moody’s, S&P or Fitch;","page_number":98,"box":{"x":69,"y":45,"width":458,"height":11}},{"id":"f200ba6f-ceda-410b-a937-240f5a91217e","block_type":"box","text":"(n) unrated notes, paper or other instruments that are of comparable quality to the instruments described above, as","page_number":98,"box":{"x":69,"y":65,"width":837,"height":11}},{"id":"06b90c03-db16-4a88-9abf-b7a4d65839e9","block_type":"box","text":"determined by the Fund’s Manager under guidelines established by the Board; and","page_number":98,"box":{"x":101,"y":80,"width":589,"height":11}},{"id":"a73b058c-66bf-4ff5-ba97-5cd64af5c7ec","block_type":"box","text":"(o) municipal bonds and notes which are guaranteed as to principal and interest by the U.S. Government or an","page_number":98,"box":{"x":69,"y":100,"width":795,"height":11}},{"id":"2ea470c1-4b21-4f58-8883-637d65035a0f","block_type":"box","text":"agency or instrumentality thereof or which otherwise depend directly or indirectly on the credit of the United","page_number":98,"box":{"x":102,"y":115,"width":764,"height":11}},{"id":"e166677f-fb12-45cf-96fd-95237e0f6528","block_type":"box","text":"States.","page_number":98,"box":{"x":102,"y":130,"width":49,"height":9}},{"id":"c753c52b-d148-4ecd-aac1-67167b9a4580","block_type":"box","text":"Mortgage-Related Securities.","page_number":98,"box":{"x":102,"y":153,"width":213,"height":11}},{"id":"bc217796-182e-475e-a4d2-5a80acdf8102","block_type":"box","text":"Mor tgage-Backed Securities.","page_number":98,"box":{"x":102,"y":176,"width":203,"height":11}},{"id":"810c088c-79e1-4149-838c-d2e7745d872a","block_type":"box","text":"Mor tgage-backed securities represent interests in pools of mor tgages in which","page_number":98,"box":{"x":312,"y":176,"width":560,"height":11}},{"id":"26c67698-04a9-4e6d-9b70-8d81367478a0","block_type":"box","text":"payments of both principal and interest on the securities are generally made monthly, in effect “passing through”","page_number":98,"box":{"x":70,"y":191,"width":805,"height":11}},{"id":"570d4c9c-d97e-4d24-aef7-f1a6c3d7f227","block_type":"box","text":"monthly payments made by borrowers on the residential or commercial mor tgage loans that underlie the securities","page_number":98,"box":{"x":69,"y":206,"width":819,"height":11}},{"id":"d8ef9827-5b13-4b25-a798-3edff2635218","block_type":"box","text":"(net of any fees paid to the issuer or guarantor of the securities). Mor tgage-backed securities differ from other forms","page_number":98,"box":{"x":69,"y":221,"width":832,"height":11}},{"id":"a173ff6c-b043-4bfb-ae9b-da2877ca6d62","block_type":"box","text":"of debt securities, which normally provide for periodic payment of interest in fixed amounts with principal payments at","page_number":98,"box":{"x":69,"y":236,"width":838,"height":11}},{"id":"784eec25-abef-47b6-8745-e4b505cf8b0b","block_type":"box","text":"maturity or specified call dates.","page_number":98,"box":{"x":69,"y":251,"width":222,"height":11}},{"id":"3f5f8e17-7847-4338-bf2d-06cf0c1d0f15","block_type":"box","text":"Mor tgage-backed securities are subject to the general risks associated with investing in real estate securities;","page_number":98,"box":{"x":102,"y":274,"width":785,"height":11}},{"id":"613a9798-03a6-4c99-8be9-0d71fa925e61","block_type":"box","text":"that is, they may lose value if the value of the underlying real estate to which a pool of mor tgages relates declines. In","page_number":98,"box":{"x":68,"y":289,"width":838,"height":11}},{"id":"47558ded-f5fc-4d9a-a967-f7cb465cd9b5","block_type":"box","text":"addition, investments in mor tgage-backed securities involve cer tain specific risks. These risks include the failure of a","page_number":98,"box":{"x":69,"y":304,"width":836,"height":11}},{"id":"193e2941-abff-4643-b94e-6456182990b7","block_type":"box","text":"par ty to meet its commitments under the related operative documents, adverse interest rate changes and the effects","page_number":98,"box":{"x":70,"y":319,"width":837,"height":12}},{"id":"501924b5-f43f-43aa-943e-204007b226d6","block_type":"box","text":"of prepayments on mor tgage cash flows. Mor tgage-backed securities are “pass-through” securities, meaning that","page_number":98,"box":{"x":69,"y":334,"width":810,"height":12}},{"id":"b4d9a352-1aca-4cef-b487-48accd5b90a4","block_type":"box","text":"principal and interest payments made by the borrower on the underlying mor tgages are passed through to a Fund.","page_number":98,"box":{"x":70,"y":350,"width":811,"height":11}},{"id":"601ef580-0aa4-4c8e-ad13-327a9a15b46d","block_type":"box","text":"Accordingly, the value of mor tgage-backed securities in which a Fund invests may be par ticularly sensitive to changes","page_number":98,"box":{"x":68,"y":365,"width":837,"height":11}},{"id":"1b2d9e89-711f-4672-b5d7-e5a6393fb614","block_type":"box","text":"in prevailing interest rates, and, like other fixed income investments, the ability of a Fund to utilize these instruments","page_number":98,"box":{"x":70,"y":380,"width":834,"height":11}},{"id":"a2efdba7-9e65-480e-8345-42573b298797","block_type":"box","text":"successfully may depend in par t upon the ability of the Manager to forecast interest rates and other economic factors","page_number":98,"box":{"x":69,"y":395,"width":840,"height":11}},{"id":"31c5b9fe-380f-48ce-935f-05a2fe157eb9","block_type":"box","text":"correctly. The value of mor tgage-backed securities, like that of traditional fixed-income securities, typically increases","page_number":98,"box":{"x":69,"y":410,"width":827,"height":11}},{"id":"beb47e6f-943b-4254-8482-996a19eea698","block_type":"box","text":"when interest rates fall and decreases when interest rates rise. However, mor tgage-backed securities differ from","page_number":98,"box":{"x":68,"y":425,"width":805,"height":11}},{"id":"8aa0c2dd-dbb1-417d-8e80-b4ea3527d9e7","block_type":"box","text":"traditional fixed-income securities because of their potential for prepayment without penalty. The price paid by a Fund","page_number":98,"box":{"x":68,"y":440,"width":834,"height":11}},{"id":"aa5fdb14-02e9-4e24-a929-9535d53bd9e3","block_type":"box","text":"for its mor tgage-backed securities, the yield the Fund expects to receive from such securities and the weighted","page_number":98,"box":{"x":68,"y":455,"width":791,"height":12}},{"id":"e48e7a69-4a93-460f-a27f-630d848cfb9d","block_type":"box","text":"average life of the securities are based on a number of factors, including the anticipated rate of prepayment of the","page_number":98,"box":{"x":69,"y":470,"width":816,"height":12}},{"id":"182c4c50-4b02-4e6c-bd88-e3bca5d8f5ae","block_type":"box","text":"underlying mor tgages. In a period of declining interest rates, borrowers may prepay the underlying mor tgages more","page_number":98,"box":{"x":69,"y":486,"width":819,"height":11}},{"id":"c193d9d6-e89e-4fac-9758-e434fb09cfed","block_type":"box","text":"quickly than anticipated, thereby reducing the yield to maturity and the average life of the mor tgage-backed","page_number":98,"box":{"x":69,"y":501,"width":761,"height":11}},{"id":"dde342f9-0104-44b7-b48e-2956af5e26ed","block_type":"box","text":"securities. Moreover, when a Fund reinvests the proceeds of a prepayment in these circumstances, it will likely","page_number":98,"box":{"x":69,"y":516,"width":791,"height":11}},{"id":"14770b75-aa12-4cb6-993b-9391c7fd7baa","block_type":"box","text":"receive a rate of interest that is lower than the rate on the security that was prepaid.","page_number":98,"box":{"x":69,"y":531,"width":602,"height":11}},{"id":"f4548feb-dcc8-4714-b8c3-a34f6095f8e4","block_type":"box","text":"To the extent that a Fund purchases mor tgage-backed securities at a premium, mor tgage foreclosures and","page_number":98,"box":{"x":101,"y":554,"width":761,"height":11}},{"id":"18bdb2e5-6212-42c0-8526-658d91ccc6c9","block_type":"box","text":"principal prepayments may result in a loss to the extent of the premium paid. If a Fund buys such securities at a","page_number":98,"box":{"x":70,"y":569,"width":800,"height":11}},{"id":"d743e2ed-3464-418d-99d2-82ba329a3f4a","block_type":"box","text":"discount, both scheduled payments of principal and unscheduled prepayments will increase current and total returns","page_number":98,"box":{"x":69,"y":584,"width":833,"height":11}},{"id":"1463f291-0eaa-4418-b43e-ff5b0731582a","block_type":"box","text":"and will accelerate the recognition of income, which, when distributed to shareholders, will be taxable as ordinary","page_number":98,"box":{"x":69,"y":599,"width":809,"height":11}},{"id":"5601d5bf-e9e8-4691-8c1b-729f59ac5a3c","block_type":"box","text":"income. In a period of rising interest rates, prepayments of the underlying mor tgages may occur at a slower than","page_number":98,"box":{"x":70,"y":614,"width":801,"height":11}},{"id":"a8c2d980-438e-4a6f-ab28-88d13bb043e1","block_type":"box","text":"expected rate, creating maturity extension risk. This par ticular risk may effectively change a security that was","page_number":98,"box":{"x":69,"y":629,"width":778,"height":11}},{"id":"d7099c58-ceaf-4755-9c60-790ff30b896c","block_type":"box","text":"considered shor t- or intermediate-term at the time of purchase into a long-term security. Since the value of long-term","page_number":98,"box":{"x":69,"y":644,"width":831,"height":12}},{"id":"f8d48710-6eb9-4577-b6b2-bb00a67eda5a","block_type":"box","text":"securities generally fluctuates more widely in response to changes in interest rates than that of shor ter-term","page_number":98,"box":{"x":69,"y":659,"width":773,"height":12}},{"id":"b256f34f-46a4-40af-a2c2-825857ec12d4","block_type":"box","text":"securities, maturity extension risk could increase the inherent volatility of the Fund. Under cer tain interest rate and","page_number":98,"box":{"x":69,"y":675,"width":818,"height":11}},{"id":"5a04ba00-0824-466f-803f-0616dfd04da4","block_type":"box","text":"prepayment scenarios, a Fund may fail to recoup fully its investment in mor tgage-backed securities notwithstanding","page_number":98,"box":{"x":70,"y":690,"width":822,"height":11}},{"id":"93de3264-4f58-48a4-8d13-925a3c46e530","block_type":"box","text":"any direct or indirect governmental or agency guarantee.","page_number":98,"box":{"x":69,"y":705,"width":399,"height":11}},{"id":"cac7ca1d-afa4-441b-9d0a-ce176d613e05","block_type":"box","text":"There are currently three types of mor tgage pass-through securities: (1) those issued by the U.S. Government or","page_number":98,"box":{"x":101,"y":727,"width":802,"height":12}},{"id":"fa2e493d-8135-494a-8835-1942ccbbe01d","block_type":"box","text":"one of its agencies or instrumentalities, such as the Government National Mor tgage Association (“Ginnie Mae”), the","page_number":98,"box":{"x":69,"y":743,"width":830,"height":11}},{"id":"586ce556-3b29-4092-ad30-feff2c7b2e08","block_type":"box","text":"Federal National Mor tgage Association (“Fannie Mae”) and the Federal Home Loan Mor tgage Corporation (“Freddie","page_number":98,"box":{"x":70,"y":758,"width":818,"height":11}},{"id":"110e625b-7e51-4b0e-ad31-ba25dad469de","block_type":"box","text":"Mac”); (2) those issued by private issuers that represent an interest in or are collateralized by pass-through","page_number":98,"box":{"x":70,"y":773,"width":766,"height":11}},{"id":"fd47434a-4792-4247-9415-a387b3ecac9a","block_type":"box","text":"securities issued or guaranteed by the U.S. Government or one of its agencies or instrumentalities; and (3) those","page_number":98,"box":{"x":69,"y":788,"width":808,"height":11}},{"id":"c6a1f001-c6a5-4459-a394-652170cbfec3","block_type":"box","text":"issued by private issuers that represent an interest in or are collateralized by whole mor tgage loans or pass-through","page_number":98,"box":{"x":70,"y":803,"width":825,"height":11}},{"id":"2cfd07b9-e166-4a66-a216-c1f5065f31ea","block_type":"box","text":"securities without a government guarantee but that usually have some form of private credit enhancement.","page_number":98,"box":{"x":69,"y":818,"width":761,"height":11}},{"id":"eca9a11f-0f20-40c0-bb13-8624b45740c5","block_type":"box","text":"Ginnie Mae is a wholly owned U.S. Government corporation within the Depar tment of Housing and Urban","page_number":98,"box":{"x":102,"y":841,"width":743,"height":11}},{"id":"feb9890e-1573-4f5e-921d-c0ae130c2764","block_type":"box","text":"Development. Ginnie Mae is authorized to guarantee, with the full faith and credit of the U.S. Government, the timely","page_number":98,"box":{"x":70,"y":856,"width":831,"height":11}},{"id":"2c74c548-9522-44b1-96df-5240fdb9bc1f","block_type":"box","text":"payment of principal and interest on securities issued by the institutions approved by Ginnie Mae (such as savings","page_number":98,"box":{"x":70,"y":871,"width":815,"height":11}},{"id":"01aaadcc-fe4b-47ff-a29b-9084c023d3ac","block_type":"box","text":"and loan institutions, commercial banks and mor tgage banks), and backed by pools of Federal Housing","page_number":98,"box":{"x":69,"y":886,"width":737,"height":12}},{"id":"b1289c2c-b2aa-4268-98cd-1c8d050e5f88","block_type":"box","text":"Administration (“FHA”)-insured or Veterans’ Administration (“VA”)-guaranteed mor tgages. Pass-through cer tificates","page_number":98,"box":{"x":68,"y":901,"width":814,"height":12}},{"id":"42fa7d1c-2901-440a-9f8b-5cd93980476e","block_type":"box","text":"II-51","page_number":98,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"87a1531c-6880-4d33-b4ba-d751efea5481","block_type":"box","text":"NM1026U-6033063-98/246","page_number":98,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"976c933e-5b07-482a-8046-30c04143ade1","block_type":"box","text":"guaranteed by Ginnie Mae (such cer tificates are also known as “Ginnie Maes”) are guaranteed as to the timely","page_number":99,"box":{"x":68,"y":45,"width":794,"height":11}},{"id":"f439a235-05dc-44a6-929f-b4867f8f19ef","block_type":"box","text":"payment of principal and interest by Ginnie Mae, whose guarantee is backed by the full faith and credit of the United","page_number":99,"box":{"x":70,"y":60,"width":828,"height":11}},{"id":"e47cd6e2-0060-4f3c-8655-361f81a00af1","block_type":"box","text":"States. Ginnie Mae cer tificates also are suppor ted by the authority of Ginnie Mae to borrow funds from the U.S.","page_number":99,"box":{"x":69,"y":75,"width":798,"height":11}},{"id":"2aface78-676d-45d2-ba24-558d255b5423","block_type":"box","text":"Treasury Depar tment to make payments under its guarantee. Mor tgage-related securities issued by Fannie Mae","page_number":99,"box":{"x":68,"y":90,"width":798,"height":11}},{"id":"4388277c-7fa0-4227-b340-3a3b42725d74","block_type":"box","text":"include Fannie Mae guaranteed Mor tgage Pass-Through Cer tificates (also known as “Fannie Maes”), which are","page_number":99,"box":{"x":70,"y":105,"width":788,"height":11}},{"id":"acf2c6ca-6e42-455f-a3cb-1804af624e30","block_type":"box","text":"guaranteed as to timely payment of principal and interest by Fannie Mae. They are not backed by or entitled to the full","page_number":99,"box":{"x":68,"y":120,"width":840,"height":12}},{"id":"60997078-893e-4108-ae0b-f5efa85254c6","block_type":"box","text":"faith and credit of the United States, but are suppor ted by the right of Fannie Mae to borrow from the U.S. Treasury","page_number":99,"box":{"x":68,"y":135,"width":825,"height":12}},{"id":"6d45d89f-2975-4d77-acf4-a60f2b56dab3","block_type":"box","text":"Depar tment. Fannie Mae was established as a federal agency in 1938 and in 1968 was char tered by Congress as a","page_number":99,"box":{"x":70,"y":150,"width":830,"height":12}},{"id":"fe3ca320-2b87-4429-9a46-67279c405e13","block_type":"box","text":"private shareholder-owned company. Mor tgage-related securities issued by Freddie Mac include Freddie Mac","page_number":99,"box":{"x":70,"y":166,"width":770,"height":11}},{"id":"0e5e5df1-0a2f-4390-86a0-f93640061547","block_type":"box","text":"Mor tgage Par ticipation Cer tificates (also known as “Freddie Macs” or “PCs”). Freddie Mac is a stockholder-owned","page_number":99,"box":{"x":70,"y":181,"width":812,"height":11}},{"id":"70234f17-3c31-4d04-9575-98f65b2ccda1","block_type":"box","text":"corporation char tered by Congress in 1970. Freddie Macs are not guaranteed by the United States or by any Federal","page_number":99,"box":{"x":69,"y":196,"width":829,"height":11}},{"id":"a9c4626b-ab22-4d5d-86e6-000e42b3efab","block_type":"box","text":"Home Loan Banks and do not constitute a debt or obligation of the United States or of any Federal Home Loan Bank.","page_number":99,"box":{"x":70,"y":211,"width":832,"height":11}},{"id":"6d31e002-32e2-4dc7-9edc-4f985c6bee11","block_type":"box","text":"Freddie Macs entitle the holder to timely payment of interest, which is guaranteed by Freddie Mac. Freddie Mac","page_number":99,"box":{"x":70,"y":226,"width":792,"height":11}},{"id":"1d79c595-4e67-49f2-bd70-1920bab492af","block_type":"box","text":"guarantees either ultimate collection or timely payment of all principal payments on the underlying mor tgage loans.","page_number":99,"box":{"x":68,"y":241,"width":819,"height":11}},{"id":"4ba7cb5a-830f-4002-9e1a-a413b1af740c","block_type":"box","text":"While Freddie Mac generally does not guarantee timely payment of principal, Freddie Mac may remit the amount due","page_number":99,"box":{"x":68,"y":256,"width":829,"height":12}},{"id":"dc1f5c63-43f5-49cd-bd30-1d556944f851","block_type":"box","text":"on account of its guarantee of ultimate payment of principal at any time after default on an underlying mor tgage, but","page_number":99,"box":{"x":69,"y":271,"width":829,"height":12}},{"id":"cf5d9e08-69c7-4bd2-ac13-25a82fb3bc21","block_type":"box","text":"in no event later than one year after it becomes payable.","page_number":99,"box":{"x":70,"y":286,"width":401,"height":12}},{"id":"23e7189f-c015-4f97-a9c8-8d925f97fa96","block_type":"box","text":"Private mor tgage pass-through securities are structured similarly to Ginnie Mae, Fannie Mae, and Freddie Mac","page_number":99,"box":{"x":102,"y":309,"width":786,"height":11}},{"id":"87ebe673-27f1-4bd6-b19a-2bce2885d6d3","block_type":"box","text":"mor tgage pass-through securities and are issued by originators of and investors in mor tgage loans, including","page_number":99,"box":{"x":69,"y":324,"width":777,"height":12}},{"id":"6610fdfc-85ce-479b-9b61-a9e80466c209","block_type":"box","text":"depository institutions, mor tgage banks, investment banks and special purpose subsidiaries of the foregoing.","page_number":99,"box":{"x":69,"y":339,"width":782,"height":12}},{"id":"b25d05cc-1339-4824-98ee-05d4e59db376","block_type":"box","text":"Pools created by private mor tgage pass-through issuers generally offer a higher rate of interest than government","page_number":99,"box":{"x":102,"y":362,"width":802,"height":11}},{"id":"db190184-1de1-465c-9944-7dbb5b49df66","block_type":"box","text":"and government-related pools because there are no direct or indirect government or agency guarantees of payments","page_number":99,"box":{"x":69,"y":377,"width":828,"height":12}},{"id":"9fdc3e16-b869-4956-be3f-56ce67343d47","block_type":"box","text":"in the private pools. However, timely payment of interest and principal of these pools may be suppor ted by various","page_number":99,"box":{"x":70,"y":392,"width":814,"height":12}},{"id":"b7da99b3-86d9-423c-b4bf-9e5dac73f08d","block_type":"box","text":"forms of insurance or guarantees, including individual loan, title, pool and hazard insurance and letters of credit. The","page_number":99,"box":{"x":68,"y":407,"width":833,"height":12}},{"id":"cef8a1ec-b3d8-4769-8a5d-c767a92cb34e","block_type":"box","text":"insurance and guarantees are issued by governmental entities, private insurers and the mor tgage poolers. The","page_number":99,"box":{"x":70,"y":423,"width":789,"height":11}},{"id":"cb4396df-4358-43b3-a3ba-1fde65c5b67b","block_type":"box","text":"insurance and guarantees and the creditwor thiness of the issuers thereof will be considered in determining whether","page_number":99,"box":{"x":70,"y":438,"width":827,"height":11}},{"id":"5d37c6ed-2cb6-4dae-9737-1897ee1009ba","block_type":"box","text":"a mor tgage-related security meets a Fund’s investment quality standards. There can be no assurance that the private","page_number":99,"box":{"x":69,"y":453,"width":838,"height":11}},{"id":"97c954b4-7798-43e9-b939-70df859022ea","block_type":"box","text":"insurers or guarantors can meet their obligations under the insurance policies or guarantee arrangements. Private","page_number":99,"box":{"x":70,"y":468,"width":810,"height":11}},{"id":"d6c3d9a4-6d80-4562-b18f-73c4040e5339","block_type":"box","text":"mor tgage pass-through securities may be bought without insurance or guarantees if, through an examination of the","page_number":99,"box":{"x":69,"y":483,"width":820,"height":11}},{"id":"84b9c92e-8131-4650-9113-f30d5d4bec91","block_type":"box","text":"loan experience and practices of the originator/servicers and poolers, the Manager determines that the securities","page_number":99,"box":{"x":70,"y":498,"width":812,"height":11}},{"id":"4d72c5da-d3a3-4d1f-a5ec-a8d9f1e0d514","block_type":"box","text":"meet a Fund’s quality standards. Any mor tgage-related securities that are issued by private issuers have some","page_number":99,"box":{"x":69,"y":514,"width":790,"height":11}},{"id":"4c92e3ed-cec8-472d-9a8d-c805bc907c86","block_type":"box","text":"exposure to subprime loans as well as to the mor tgage and credit markets generally.","page_number":99,"box":{"x":69,"y":529,"width":604,"height":11}},{"id":"28f997f9-2bd1-4ec1-8d04-7bf9b503f421","block_type":"box","text":"In addition, mor tgage-related securities that are issued by private issuers are not subject to the underwriting","page_number":99,"box":{"x":102,"y":551,"width":774,"height":11}},{"id":"648e88c5-903e-4631-9efa-90bff971cd59","block_type":"box","text":"requirements for the underlying mor tgages that are applicable to those mor tgage-related securities that have a","page_number":99,"box":{"x":69,"y":566,"width":791,"height":11}},{"id":"053841c8-c2c7-4361-a911-e44cccf1f1c1","block_type":"box","text":"government or government-sponsored entity guarantee. As a result, the mor tgage loans underlying private mor tgage","page_number":99,"box":{"x":68,"y":582,"width":832,"height":11}},{"id":"d867a47f-1754-4748-8b91-44f3b1e970e7","block_type":"box","text":"related securities may, and frequently do, have less favorable collateral, credit risk or other underwriting","page_number":99,"box":{"x":69,"y":596,"width":742,"height":12}},{"id":"835e6633-22d8-4a72-96e8-a4e19091f01c","block_type":"box","text":"characteristics than government or government-sponsored mor tgage-related securities and have wider variances in a","page_number":99,"box":{"x":69,"y":612,"width":831,"height":11}},{"id":"0f5558b5-6497-4579-8585-ee18f8fac2fd","block_type":"box","text":"number of terms including interest rate, term, size, purpose and borrower characteristics. Privately issued pools more","page_number":99,"box":{"x":69,"y":627,"width":840,"height":11}},{"id":"a62811f6-ffd8-4c5e-bdd5-0105ac3c3fd4","block_type":"box","text":"frequently include second mor tgages, high loan-to-value mor tgages and manufactured housing loans. The coupon","page_number":99,"box":{"x":68,"y":642,"width":809,"height":11}},{"id":"baa49af2-0791-4b28-ba72-001db187e64b","block_type":"box","text":"rates and maturities of the underlying mor tgage loans in a private-label mor tgage-related securities pool may vary to","page_number":99,"box":{"x":69,"y":657,"width":828,"height":11}},{"id":"d31f0140-d4a5-461a-a584-57efe8a169b6","block_type":"box","text":"a greater extent than those included in a government guaranteed pool, and the pool may include subprime mor tgage","page_number":99,"box":{"x":69,"y":672,"width":830,"height":11}},{"id":"fd94fab9-1618-492d-b778-6e79f7c9011c","block_type":"box","text":"loans. Subprime loans refer to loans made to borrowers with weakened credit histories or with a lower capacity to","page_number":99,"box":{"x":70,"y":687,"width":810,"height":11}},{"id":"aa8ad197-9ea9-49ae-be58-80a347e254b6","block_type":"box","text":"make timely payments on their loans. For these reasons, the loans underlying these securities have had in many","page_number":99,"box":{"x":69,"y":703,"width":804,"height":11}},{"id":"3ca090f7-4df5-4f57-9784-ff10c8fa0ad5","block_type":"box","text":"cases higher default rates than those loans that meet government underwriting requirements.","page_number":99,"box":{"x":69,"y":717,"width":669,"height":12}},{"id":"cc7a9716-efb6-45d7-979a-9e9b66257f8c","block_type":"box","text":"The risk of non-payment is greater for mor tgage-related securities that are backed by mor tgage pools that","page_number":99,"box":{"x":101,"y":740,"width":754,"height":11}},{"id":"bf3102e4-dde4-43cd-9787-613d42ce9615","block_type":"box","text":"contain subprime loans, but a level of risk exists for all loans. Market factors adversely affecting mor tgage loan","page_number":99,"box":{"x":69,"y":755,"width":795,"height":11}},{"id":"c3115093-8264-4f12-8573-99e84a93a3d7","block_type":"box","text":"repayments may include a general economic turndown, high unemployment, a general slowdown in the real estate","page_number":99,"box":{"x":69,"y":771,"width":812,"height":11}},{"id":"4cc28a77-64d1-400f-ab6a-0ad9b15a8931","block_type":"box","text":"market, a drop in the market prices of real estate, or an increase in interest rates resulting in higher mor tgage","page_number":99,"box":{"x":69,"y":785,"width":788,"height":12}},{"id":"3ecb0645-addf-4555-b464-4a116778e91a","block_type":"box","text":"payments by holders of adjustable rate mor tgages.","page_number":99,"box":{"x":70,"y":801,"width":361,"height":11}},{"id":"17ea87b8-9a0a-47d4-8011-19ae892fb942","block_type":"box","text":"Privately issued mor tgage-related securities are not traded on an exchange and there may be a limited market","page_number":99,"box":{"x":102,"y":823,"width":784,"height":12}},{"id":"abb77fd8-b47a-46f8-9776-5e5a418c7880","block_type":"box","text":"for the securities, especially when there is a perceived weakness in the mor tgage and real estate market sectors.","page_number":99,"box":{"x":68,"y":838,"width":813,"height":12}},{"id":"5b27a60a-ea06-4408-be03-83108f4f5312","block_type":"box","text":"Without an active trading market, mor tgage-related securities held in a Fund’s por tfolio may be par ticularly difficult to","page_number":99,"box":{"x":68,"y":853,"width":837,"height":12}},{"id":"c448bbd3-b106-4e27-9aa8-d6b5f731195b","block_type":"box","text":"value because of the complexities involved in assessing the value of the underlying mor tgage loans.","page_number":99,"box":{"x":68,"y":869,"width":714,"height":11}},{"id":"891b4686-3c06-4e64-a313-8dda16f8cf9d","block_type":"box","text":"Collateralized Mor tgage Obligations (“CMOs”).","page_number":99,"box":{"x":102,"y":891,"width":328,"height":12}},{"id":"14111379-182e-48c8-95e4-ccfe750c64f9","block_type":"box","text":"CMOs are debt obligations collateralized by residential or","page_number":99,"box":{"x":437,"y":891,"width":407,"height":12}},{"id":"17b49e64-5f51-4e8c-b8b4-1819a09f9ea4","block_type":"box","text":"commercial mor tgage loans or residential or commercial mor tgage pass-through securities. Interest and prepaid","page_number":99,"box":{"x":69,"y":907,"width":800,"height":11}},{"id":"88b026d8-0719-438b-be11-bcd9ca671ae8","block_type":"box","text":"II-52","page_number":99,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"402b9060-e13c-4efd-af3c-b3b38a23ad29","block_type":"box","text":"NM1026U-6033063-99/246","page_number":99,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"68d2c16e-8611-46bb-b242-022c706bf786","block_type":"box","text":"principal are generally paid monthly. CMOs may be collateralized by whole mor tgage loans or private mor tgage pass","page_number":100,"box":{"x":70,"y":45,"width":827,"height":11}},{"id":"140712fd-a249-4417-8ae1-8fa0b21ee9bb","block_type":"box","text":"through securities but are more typically collateralized by por tfolios of mor tgage pass-through securities guaranteed","page_number":100,"box":{"x":68,"y":60,"width":826,"height":11}},{"id":"a500bf33-a3b4-4e42-80d6-aaabf2605753","block_type":"box","text":"by Ginnie Mae, Freddie Mac, or Fannie Mae. The issuer of a series of CMOs may elect to be treated as a Real Estate","page_number":100,"box":{"x":69,"y":75,"width":833,"height":11}},{"id":"d9b42cbb-4471-40bb-88ee-fcbeae0c09f9","block_type":"box","text":"Mor tgage Investment Conduit (“REMIC”). All future references to CMOs also include REMICs.","page_number":100,"box":{"x":70,"y":90,"width":661,"height":11}},{"id":"ff7e371e-8b7e-482b-ab0b-6e6fef617e70","block_type":"box","text":"CMOs are structured into multiple classes, often referred to as a “tranche,” each issued at a specific adjustable","page_number":100,"box":{"x":102,"y":113,"width":803,"height":11}},{"id":"58879396-97d4-4c9b-9989-2af3ce88fd47","block_type":"box","text":"or fixed interest rate, and bearing a different stated maturity date and each must be fully retired no later than its final","page_number":100,"box":{"x":69,"y":128,"width":837,"height":11}},{"id":"1991f48b-0c03-4bae-b593-b591e1812689","block_type":"box","text":"distribution date. Actual maturity and average life will depend upon the prepayment experience of the collateral, which","page_number":100,"box":{"x":69,"y":143,"width":838,"height":11}},{"id":"3d7b5589-df81-4abb-b83a-cdde34493cdc","block_type":"box","text":"is ordinarily unrelated to the stated maturity date. CMOs often provide for a modified form of call protection through a","page_number":100,"box":{"x":70,"y":158,"width":836,"height":11}},{"id":"a4ac38c2-b316-47e0-a332-410414ced5ff","block_type":"box","text":"de facto breakdown of the underlying pool of mor tgages according to how quickly the loans are repaid. Monthly","page_number":100,"box":{"x":69,"y":173,"width":791,"height":11}},{"id":"fbb3033a-8733-42bc-abb0-81cb15717ce3","block_type":"box","text":"payment of principal received from the pool of underlying mor tgages, including prepayments, is first returned to","page_number":100,"box":{"x":70,"y":188,"width":792,"height":12}},{"id":"dd1ed036-7d8a-45a1-9a9e-ea18f7c5d98a","block_type":"box","text":"investors holding the shor test maturity class. Investors holding the longer maturity classes usually receive principal","page_number":100,"box":{"x":70,"y":204,"width":820,"height":11}},{"id":"f2762fb3-e0a0-4bc8-a8f7-6ea839afc344","block_type":"box","text":"only after the first class has been retired. An investor may be par tially protected against a sooner than desired return","page_number":100,"box":{"x":69,"y":218,"width":836,"height":12}},{"id":"bf548c69-bb4c-48a1-b304-c9efd6c5306f","block_type":"box","text":"of principal because of the sequential payments.","page_number":100,"box":{"x":69,"y":234,"width":346,"height":11}},{"id":"7c8601f3-65eb-4b01-b1fc-cda9ccd7c834","block_type":"box","text":"Cer tain issuers of CMOs are not considered investment companies pursuant to a rule adopted by the","page_number":100,"box":{"x":102,"y":256,"width":723,"height":11}},{"id":"cc35644a-ec68-4da4-86c8-854d6f11e95d","block_type":"box","text":"Commission, and a Fund may invest in the securities of such issuers without the limitations imposed by the","page_number":100,"box":{"x":69,"y":271,"width":768,"height":12}},{"id":"1ad11286-3290-46fe-8054-0cc09236d777","block_type":"box","text":"Investment Company Act on investments by a Fund in other investment companies. In addition, in reliance on an","page_number":100,"box":{"x":70,"y":287,"width":800,"height":11}},{"id":"930dbb9b-7831-442c-88c6-306e6910c6b1","block_type":"box","text":"earlier Commission interpretation, a Fund’s investments in cer tain other qualifying CMOs, which cannot or do not rely","page_number":100,"box":{"x":69,"y":302,"width":836,"height":11}},{"id":"2788ad19-1358-49f4-86df-027b006c8fb4","block_type":"box","text":"on the rule, are also not subject to the limitation of the Investment Company Act on acquiring interests in other","page_number":100,"box":{"x":69,"y":317,"width":793,"height":11}},{"id":"24b590ad-e74f-4df4-a9ed-934e34b31dc9","block_type":"box","text":"investment companies. In order to be able to rely on the Commission’s interpretation, these CMOs must be","page_number":100,"box":{"x":70,"y":332,"width":767,"height":11}},{"id":"c43ee1f4-270d-4c4a-ab79-de04bde59863","block_type":"box","text":"unmanaged, fixed asset issuers, that: (1) invest primarily in mor tgage-backed securities; (2) do not issue redeemable","page_number":100,"box":{"x":69,"y":347,"width":838,"height":11}},{"id":"4969c6f7-cf0e-4321-8989-f067da0d31e9","block_type":"box","text":"securities; (3) operate under general exemptive orders exempting them from all provisions of the Investment","page_number":100,"box":{"x":69,"y":362,"width":773,"height":11}},{"id":"0af38a44-9155-446d-a9a7-6b1d0bbd08f9","block_type":"box","text":"Company Act; and (4) are not registered or regulated under the Investment Company Act as investment companies.","page_number":100,"box":{"x":69,"y":377,"width":821,"height":12}},{"id":"cbbc2e8b-8533-44d2-99a1-403232a519e6","block_type":"box","text":"To the extent that a Fund selects CMOs that cannot rely on the rule or do not meet the above requirements, the Fund","page_number":100,"box":{"x":68,"y":392,"width":836,"height":12}},{"id":"ef2ed83f-c557-4b44-b48a-cb4482665013","block_type":"box","text":"may not invest more than 10% of its assets in all such entities and may not acquire more than 3% of the voting","page_number":100,"box":{"x":69,"y":407,"width":795,"height":12}},{"id":"65d6505e-1a89-43e3-87a7-b1dd7a37253b","block_type":"box","text":"securities of any single such entity.","page_number":100,"box":{"x":69,"y":423,"width":248,"height":11}},{"id":"b813f29a-cbaf-4230-802a-6a8e94be982c","block_type":"box","text":"A Fund may also invest in, among other things, parallel pay CMOs, sequential pay CMOs, and floating rate CMOs.","page_number":100,"box":{"x":101,"y":445,"width":807,"height":12}},{"id":"a3dec7cb-7e6a-4195-8cea-34ce35d39650","block_type":"box","text":"Parallel pay CMOs are structured to provide payments of principal on each payment date to more than one class,","page_number":100,"box":{"x":69,"y":460,"width":805,"height":12}},{"id":"2eaef509-1394-4470-b855-99628256ef57","block_type":"box","text":"concurrently on a propor tionate or dispropor tionate basis. These simultaneous payments are taken into account in","page_number":100,"box":{"x":69,"y":476,"width":819,"height":11}},{"id":"a19c650b-c0fe-46e4-ba67-31f868db5271","block_type":"box","text":"calculating the final distribution date of each class. Sequential pay CMOs generally pay principal to only one class at","page_number":100,"box":{"x":69,"y":491,"width":829,"height":11}},{"id":"8af05c51-6da2-418d-8e07-477f3bd1ebb3","block_type":"box","text":"a time while paying interest to several classes. A wide variety of REMIC Cer tificates may be issued in the parallel pay","page_number":100,"box":{"x":69,"y":506,"width":835,"height":11}},{"id":"4cdd82a8-b359-4662-b20a-000717e0b9b8","block_type":"box","text":"or sequential pay structures. These securities include accrual cer tificates (also known as “Z-Bonds”), which only","page_number":100,"box":{"x":69,"y":521,"width":802,"height":11}},{"id":"0f715baf-9b1e-47fb-ae1d-ee09320396a5","block_type":"box","text":"accrue interest at a specified rate until all other cer tificates having an earlier final distribution date have been retired","page_number":100,"box":{"x":69,"y":536,"width":833,"height":11}},{"id":"3eb0a3af-aa24-4e82-9672-af68e4a959bc","block_type":"box","text":"and are conver ted thereafter to an interest-paying security. Floating rate CMOs are securities whose coupon rate","page_number":100,"box":{"x":69,"y":551,"width":801,"height":11}},{"id":"fa32fea0-fd13-4fe9-b8f0-f917e4eb0c1a","block_type":"box","text":"fluctuates according to some formula related to an existing market index or rate. Typical indices would include the","page_number":100,"box":{"x":68,"y":566,"width":813,"height":11}},{"id":"549ee294-67d5-4ce7-9a8f-cca3f69d97a6","block_type":"box","text":"eleventh district cost-of-funds index (“COFI”), one-year Treasury yields, and ten-year Treasury yields.","page_number":100,"box":{"x":69,"y":581,"width":708,"height":11}},{"id":"39b4ddcc-ff27-4eca-9cf8-19502879b03b","block_type":"box","text":"Classes of CMOs also include planned amor tization classes (“PACs”) and targeted amor tization classes","page_number":100,"box":{"x":102,"y":604,"width":742,"height":11}},{"id":"13e1e1b1-0016-4657-af96-f71fe81cc2df","block_type":"box","text":"(“TACs”). PAC bonds generally require payments of a specified amount of principal on each payment date. The","page_number":100,"box":{"x":69,"y":619,"width":784,"height":11}},{"id":"fa67594c-9373-44ff-9768-706924e8af0d","block_type":"box","text":"scheduled principal payments for PAC Cer tificates generally have the highest priority on each payment date after","page_number":100,"box":{"x":69,"y":634,"width":800,"height":12}},{"id":"b4d6cdbf-b6e7-471e-9943-436ab7cea002","block_type":"box","text":"interest due has been paid to all classes entitled to receive interest currently. Shor tfalls, if any, are added to the","page_number":100,"box":{"x":70,"y":649,"width":802,"height":12}},{"id":"f6c5a84f-3c51-47e6-b6fd-69bb0979d56e","block_type":"box","text":"amount payable on the next payment date. The PAC Cer tificate payment schedule is taken into account in calculating","page_number":100,"box":{"x":69,"y":664,"width":834,"height":12}},{"id":"f7b56433-851f-4388-a222-f3be32a1fda3","block_type":"box","text":"the final distribution date of each class of PAC. In order to create PAC tranches, one or more tranches generally must","page_number":100,"box":{"x":68,"y":680,"width":835,"height":11}},{"id":"bc7e2a69-2cde-47bd-822e-d8338d1fd02c","block_type":"box","text":"be created that absorb most of the volatility in the underlying mor tgage assets. These tranches (often called","page_number":100,"box":{"x":69,"y":695,"width":772,"height":11}},{"id":"e17678f0-be98-4da4-b7d0-c846fb660cfe","block_type":"box","text":"“suppor ts” or “companion” tranches) tend to have market prices and yields that are more volatile than the PAC","page_number":100,"box":{"x":70,"y":710,"width":792,"height":11}},{"id":"d394cd8a-3f91-40be-a39b-00c761b5d60b","block_type":"box","text":"classes.","page_number":100,"box":{"x":69,"y":725,"width":57,"height":9}},{"id":"3bec2451-e172-4bee-ac5c-8edf0f0c16f4","block_type":"box","text":"TACs are similar to PACs in that they require that specified amounts of principal be applied on each payment","page_number":100,"box":{"x":101,"y":748,"width":774,"height":11}},{"id":"6cb904b3-d5e7-4228-b67d-b34b0b70465a","block_type":"box","text":"date to one or more classes of REMIC Cer tificates. A PAC’s payment schedule, however, remains in effect as long as","page_number":100,"box":{"x":69,"y":763,"width":835,"height":11}},{"id":"2509ec7d-eb21-4ba1-88e0-1bc10562a03d","block_type":"box","text":"prepayment rates on the underlying mor tgages do not exceed cer tain ranges. In contrast, a TAC provides investors","page_number":100,"box":{"x":70,"y":778,"width":815,"height":11}},{"id":"6e143c6d-e0bb-4780-9568-7d4accabba88","block_type":"box","text":"with protection, to a cer tain level, against either faster than expected or slower than expected prepayment rates, but","page_number":100,"box":{"x":68,"y":793,"width":833,"height":11}},{"id":"b9ffb4e2-ade7-4c02-963c-ea533e047784","block_type":"box","text":"not both. TACs thus provide more cash flow stability than a regular sequential paying class, but less than a PAC. TACs","page_number":100,"box":{"x":69,"y":808,"width":839,"height":11}},{"id":"feee6373-c692-4216-9895-23cb7b06d8ca","block_type":"box","text":"also tend to have market prices and yields that are more volatile than PACs.","page_number":100,"box":{"x":69,"y":823,"width":541,"height":11}},{"id":"8bcb2ee0-00c7-4811-9f08-2bcc0e4ef74e","block_type":"box","text":"Adjustable Rate Mor tgage Securities.","page_number":100,"box":{"x":101,"y":846,"width":265,"height":11}},{"id":"1e110632-491d-4d46-b9f3-4ba897ca28ff","block_type":"box","text":"Adjustable rate mor tgage securities (“ARMs”) are pass-through securities","page_number":100,"box":{"x":372,"y":846,"width":523,"height":11}},{"id":"6101d200-d6db-4e5f-9dba-d2c206b090ff","block_type":"box","text":"collateralized by mor tgages with adjustable rather than fixed rates. ARMs eligible for inclusion in a mor tgage pool","page_number":100,"box":{"x":69,"y":861,"width":807,"height":11}},{"id":"7b18862d-e22e-4cd6-a80a-a2a6459eecac","block_type":"box","text":"generally provide for a fixed initial mor tgage interest rate for a set number of scheduled monthly payments. After that","page_number":100,"box":{"x":68,"y":876,"width":835,"height":11}},{"id":"fb1ce3e8-363b-462f-a300-2e05f3a16bfd","block_type":"box","text":"schedule of payments has been completed, the interest rates are subject to periodic adjustment based on changes","page_number":100,"box":{"x":69,"y":891,"width":824,"height":12}},{"id":"bbdbe2e3-7da3-4331-993b-9113253697e9","block_type":"box","text":"to a designated benchmark index.","page_number":100,"box":{"x":68,"y":907,"width":241,"height":11}},{"id":"85049d5b-60b7-4724-8979-db29ca355c9e","block_type":"box","text":"II-53","page_number":100,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"6d9a6da4-b1f9-47a8-a43d-03b36489ff5c","block_type":"box","text":"NM1026U-6033063-100/246","page_number":100,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"19459edc-5258-492d-acce-d7c39eea9572","block_type":"box","text":"ARMs contain maximum and minimum rates beyond which the mor tgage interest rate may not vary over the","page_number":101,"box":{"x":101,"y":45,"width":767,"height":11}},{"id":"5e338f81-1f98-4ac6-944d-1cfab0cb4edd","block_type":"box","text":"lifetime of the security. In addition, cer tain ARMs provide for additional limitations on the maximum amount by which","page_number":101,"box":{"x":70,"y":60,"width":828,"height":11}},{"id":"15e8a303-941e-4c96-be8b-4e8dd8062905","block_type":"box","text":"the mor tgage interest rate may adjust for any single adjustment period. In the event that market rates of interest rise","page_number":101,"box":{"x":68,"y":75,"width":837,"height":11}},{"id":"bdff82ca-541b-4b65-b2ed-3d9e4b31028f","block_type":"box","text":"more rapidly to levels above that of the ARM’s maximum rate, the ARM’s coupon may represent a below market rate","page_number":101,"box":{"x":69,"y":90,"width":830,"height":11}},{"id":"3182e898-3bf2-4d17-aef7-342ac93d12e6","block_type":"box","text":"of interest. In these circumstances, the market value of the ARM security will likely have fallen.","page_number":101,"box":{"x":69,"y":105,"width":676,"height":11}},{"id":"4bbfaa1c-ab9b-41e9-9c76-248cdfd1db64","block_type":"box","text":"Cer tain ARMs contain limitations on changes in the required monthly payment. In the event that a monthly","page_number":101,"box":{"x":102,"y":128,"width":757,"height":11}},{"id":"c148b62a-edc3-40ce-b1f7-eb17f54923cd","block_type":"box","text":"payment is not sufficient to pay the interest accruing on an ARM, any such excess interest is added to the principal","page_number":101,"box":{"x":70,"y":143,"width":822,"height":11}},{"id":"48462c55-6694-4806-abeb-de5e13cd2293","block_type":"box","text":"balance of the mor tgage loan, which is repaid through future monthly payments. If the monthly payment for such an","page_number":101,"box":{"x":69,"y":158,"width":823,"height":11}},{"id":"97745c9d-2fbd-471c-80db-5d761e737cc0","block_type":"box","text":"instrument exceeds the sum of the interest accrued at the applicable mor tgage interest rate and the principal","page_number":101,"box":{"x":70,"y":173,"width":782,"height":11}},{"id":"496454ae-1c7a-4d62-9045-8e37c522db9a","block_type":"box","text":"payment required at such point to amor tize the outstanding principal balance over the remaining term of the loan, the","page_number":101,"box":{"x":70,"y":188,"width":838,"height":12}},{"id":"270979bf-fa2d-492a-bea4-fd9df7bcef94","block_type":"box","text":"excess is then used to reduce the outstanding principal balance of the ARM.","page_number":101,"box":{"x":69,"y":203,"width":544,"height":12}},{"id":"5ebca076-cf80-49c5-be51-a9f95fc20c4a","block_type":"box","text":"CMO Residuals.","page_number":101,"box":{"x":102,"y":226,"width":112,"height":9}},{"id":"5361a1f0-8034-4eeb-9703-0b145d5318a8","block_type":"box","text":"CMO residuals are derivative mor tgage securities issued by agencies or instrumentalities of the","page_number":101,"box":{"x":221,"y":226,"width":682,"height":11}},{"id":"206b32c5-ddd6-4b8e-bbff-cb348dccd35c","block_type":"box","text":"U.S. Government or by private originators of, or investors in, mor tgage loans, including savings and loan","page_number":101,"box":{"x":70,"y":241,"width":740,"height":11}},{"id":"9ec428bf-bce2-42ed-aa31-e8bfe8e78ff3","block_type":"box","text":"associations, homebuilders, mor tgage banks, commercial banks, investment banks, and special purpose entities of","page_number":101,"box":{"x":69,"y":256,"width":829,"height":12}},{"id":"7899a04f-69c3-4929-aefe-39000430a51c","block_type":"box","text":"the foregoing. The cash flow generated by the mor tgage assets underlying a series of CMOs is applied first to make","page_number":101,"box":{"x":68,"y":271,"width":826,"height":12}},{"id":"90f2d0ca-9945-44da-aa7e-295b1645c015","block_type":"box","text":"required payments of principal and interest on the CMOs and second to pay the related administrative expenses and","page_number":101,"box":{"x":69,"y":286,"width":831,"height":12}},{"id":"c9f59e17-0b9f-4685-a919-413ba0f8157c","block_type":"box","text":"any management fees of the issuer. The residual in a CMO structure generally represents the interest in any excess","page_number":101,"box":{"x":69,"y":302,"width":827,"height":11}},{"id":"0c9a5755-e9d7-4804-8d6a-28f5fcf543af","block_type":"box","text":"cash flow remaining after making the foregoing payments. Each payment of such excess cash flow to a holder of the","page_number":101,"box":{"x":69,"y":317,"width":829,"height":11}},{"id":"8e679301-32bd-4bdf-81a9-a5c04bf28ac2","block_type":"box","text":"related CMO residual represents income and/or a return of capital. The amount of residual cash flow resulting from a","page_number":101,"box":{"x":69,"y":332,"width":838,"height":11}},{"id":"abe0f69d-2e0a-4786-8fb0-5e659d4b246b","block_type":"box","text":"CMO will depend on, among other things, the characteristics of the mor tgage assets, the coupon rate of each class","page_number":101,"box":{"x":69,"y":347,"width":825,"height":11}},{"id":"bd089e00-4592-4c02-b8e1-9a4be19adbcd","block_type":"box","text":"of CMO, prevailing interest rates, the amount of administrative expenses and the prepayment experience on the","page_number":101,"box":{"x":69,"y":362,"width":798,"height":11}},{"id":"9f966895-f3d1-448a-9574-0851fcda5d3d","block_type":"box","text":"mor tgage assets. In par t, the yield to maturity on the CMO residuals is extremely sensitive to prepayments on the","page_number":101,"box":{"x":69,"y":377,"width":813,"height":12}},{"id":"9042e921-aa18-4b5f-9f04-a4b375f5a1e1","block_type":"box","text":"related underlying mor tgage assets, in the same manner as an interest-only class of stripped mor tgage-related","page_number":101,"box":{"x":69,"y":392,"width":790,"height":12}},{"id":"ac41b656-1c9c-4c14-ab1b-6615847c740f","block_type":"box","text":"securities. In addition, if a series of a CMO includes a class that bears interest at an adjustable rate, the yield to","page_number":101,"box":{"x":69,"y":407,"width":805,"height":12}},{"id":"a684e593-5abf-4859-a08c-f99e2ad79df9","block_type":"box","text":"maturity on the related CMO residual will also be extremely sensitive to changes in the level of the index upon which","page_number":101,"box":{"x":69,"y":423,"width":828,"height":11}},{"id":"0c5c5f63-d295-4018-941c-fcc76e3bb8fe","block_type":"box","text":"interest rate adjustments are based. In cer tain circumstances, a Fund may fail to recoup fully its initial investment in","page_number":101,"box":{"x":70,"y":438,"width":831,"height":11}},{"id":"ee608d1e-4bf2-4744-8ed1-10ddbb179c94","block_type":"box","text":"a CMO residual.","page_number":101,"box":{"x":69,"y":453,"width":112,"height":9}},{"id":"da9628ed-bc1e-4157-a462-8e4267dde89f","block_type":"box","text":"CMO residuals are generally purchased and sold by institutional investors through one or more investment","page_number":101,"box":{"x":102,"y":476,"width":758,"height":11}},{"id":"b084779b-b718-457f-ae8e-0d5747ea7476","block_type":"box","text":"banking firms acting as brokers or dealers. Transactions in CMO residuals are generally completed only after careful","page_number":101,"box":{"x":69,"y":491,"width":827,"height":11}},{"id":"21c30746-03ea-4138-8113-9a8a95f4fb06","block_type":"box","text":"review of the characteristics of the securities in question. In addition, CMO residuals may or, pursuant to an","page_number":101,"box":{"x":69,"y":506,"width":769,"height":11}},{"id":"8d63b3d9-a563-472a-a176-e808a0970c63","block_type":"box","text":"exemption therefrom, may not have been registered under the Securities Act. Residual interests generally are junior","page_number":101,"box":{"x":69,"y":521,"width":825,"height":11}},{"id":"c78e6ceb-401f-47b5-8e6d-487acfc0ece9","block_type":"box","text":"to, and may be significantly more volatile than, “regular” CMO and REMIC interests. CMO residuals, whether or not","page_number":101,"box":{"x":68,"y":536,"width":820,"height":11}},{"id":"2a6805ab-e4c3-4d98-8be0-328ac7216723","block_type":"box","text":"registered under the Securities Act, may be subject to cer tain restrictions on transferability.","page_number":101,"box":{"x":69,"y":551,"width":650,"height":11}},{"id":"3eeba0d4-ee34-47fb-a12a-86cf40c8c654","block_type":"box","text":"Stripped Mor tgage-Backed Securities.","page_number":101,"box":{"x":102,"y":574,"width":267,"height":11}},{"id":"782985de-2399-4f45-904d-1fdca7b3b34b","block_type":"box","text":"A Fund may invest in stripped mor tgage-backed securities (“SMBSs”)","page_number":101,"box":{"x":375,"y":574,"width":493,"height":11}},{"id":"1483d432-1b75-4965-bff8-b7275eb670de","block_type":"box","text":"issued by agencies or instrumentalities of the United States. SMBSs are derivative multi-class mor tgage-backed","page_number":101,"box":{"x":70,"y":589,"width":798,"height":11}},{"id":"39be2602-37b0-43ea-a847-013305353782","block_type":"box","text":"securities. SMBS arrangements commonly involve two classes of securities that receive different propor tions of the","page_number":101,"box":{"x":69,"y":604,"width":826,"height":11}},{"id":"891bbcb8-6c51-46b3-a6ea-ddb842b5bd3a","block_type":"box","text":"interest and principal distributions on a pool of mor tgage assets. A common variety of SMBS is where one class (the","page_number":101,"box":{"x":70,"y":619,"width":832,"height":11}},{"id":"e358fbba-4c48-46c3-8202-9c5b8ab59588","block_type":"box","text":"principal only or PO class) receives some of the interest and most of the principal from the underlying assets, while","page_number":101,"box":{"x":70,"y":634,"width":821,"height":12}},{"id":"f5596403-9523-442b-8f46-945a862ab8b9","block_type":"box","text":"the other class (the interest only or IO class) receives most of the interest and the remainder of the principal. In the","page_number":101,"box":{"x":68,"y":649,"width":826,"height":12}},{"id":"0252c49a-e608-42e5-bb43-3e8472222b07","block_type":"box","text":"most extreme case, the IO class receives all of the interest, while the PO class receives all of the principal. While a","page_number":101,"box":{"x":69,"y":664,"width":822,"height":11}},{"id":"2bc20050-2576-4312-b030-04558b9e0e2d","block_type":"box","text":"Fund may purchase securities of a PO class, a Fund is more likely to purchase the securities of an IO class. The yield","page_number":101,"box":{"x":70,"y":680,"width":834,"height":11}},{"id":"7ae91419-4ebe-46da-8d0d-a7fa5255f53d","block_type":"box","text":"to maturity of an IO class is extremely sensitive to the rate of principal payments (including prepayments) on the","page_number":101,"box":{"x":68,"y":695,"width":800,"height":11}},{"id":"e8cc78d9-a87b-4252-943b-3e542d544ff8","block_type":"box","text":"related underlying assets, and a rapid rate of principal prepayments in excess of that considered in pricing the","page_number":101,"box":{"x":69,"y":710,"width":786,"height":11}},{"id":"7dd91f45-e7d5-455e-a8be-aac6ef031dd2","block_type":"box","text":"securities will have a material adverse effect on an IO security’s yield to maturity. If the underlying mor tgage assets","page_number":101,"box":{"x":69,"y":725,"width":823,"height":11}},{"id":"12d5c144-f99e-43c3-b60d-5bf8d2016ab2","block_type":"box","text":"experience greater than anticipated payments of principal, a Fund may fail to recoup fully its initial investment in IOs.","page_number":101,"box":{"x":69,"y":740,"width":832,"height":11}},{"id":"ba0ee48f-c0e5-4684-8fe9-afd8d77181d8","block_type":"box","text":"In addition, there are cer tain types of IOs that represent the interest por tion of a par ticular class as opposed to the","page_number":101,"box":{"x":70,"y":755,"width":824,"height":11}},{"id":"822f6632-c8d3-4501-95ef-fad60b5c4c88","block_type":"box","text":"interest por tion of the entire pool. The sensitivity of this type of IO to interest rate fluctuations may be increased","page_number":101,"box":{"x":70,"y":770,"width":800,"height":11}},{"id":"24b862ac-8a40-4094-b5ac-0568c8aabeaa","block_type":"box","text":"because of the characteristics of the principal por tion to which they relate. As a result of the above factors, a Fund","page_number":101,"box":{"x":69,"y":785,"width":818,"height":12}},{"id":"df87ea58-5116-41d0-963b-040c9b25d6c4","block_type":"box","text":"generally will purchase IOs only as a component of so called “synthetic” securities. This means that purchases of IOs","page_number":101,"box":{"x":68,"y":801,"width":840,"height":11}},{"id":"b6880d6a-5236-427b-9edd-8445a9ac5727","block_type":"box","text":"will be matched with cer tain purchases of other securities, such as POs, inverse floating rate CMOs or fixed rate","page_number":101,"box":{"x":68,"y":816,"width":802,"height":11}},{"id":"fcb69b10-f62c-42d9-a5ae-13fa89c22cfe","block_type":"box","text":"securities; as interest rates fall, presenting a greater risk of unanticipated prepayments of principal, the negative","page_number":101,"box":{"x":69,"y":831,"width":805,"height":11}},{"id":"3001286a-47c6-4127-b21c-99b3c8f8f28e","block_type":"box","text":"effect on a Fund because of its holdings of IOs should be diminished somewhat because of the increased yield on","page_number":101,"box":{"x":69,"y":846,"width":814,"height":11}},{"id":"fdf1a902-4e05-4c9d-81b2-602d981b89b2","block_type":"box","text":"the inverse floating rate CMOs or the increased appreciation on the POs or fixed rate securities.","page_number":101,"box":{"x":68,"y":861,"width":683,"height":11}},{"id":"42515b6e-279c-42cb-b314-c4f76f9e5a60","block_type":"box","text":"Tiered Index Bonds.","page_number":101,"box":{"x":103,"y":884,"width":138,"height":9}},{"id":"9f9318f1-bc53-4fb7-a2bc-87280508a5ad","block_type":"box","text":"Tiered index bonds are forms of mor tgage-related securities. The interest rate on a tiered","page_number":101,"box":{"x":247,"y":884,"width":638,"height":11}},{"id":"24f65be6-807f-487f-a0e0-8ff5f4767bb1","block_type":"box","text":"index bond is tied to a specified index or market rate. So long as this index or market rate is below a predetermined","page_number":101,"box":{"x":70,"y":899,"width":825,"height":11}},{"id":"fcf5e786-5f03-43a1-9f3d-8cec9e2a17f2","block_type":"box","text":"II-54","page_number":101,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"64a7a0bd-d001-4808-98b2-b27d191bbf3a","block_type":"box","text":"NM1026U-6033063-101/246","page_number":101,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"8de26c15-38d5-460c-b328-8d65c7bca127","block_type":"box","text":"“strike” rate, the interest rate on the tiered index bond remains fixed. If, however, the specified index or market rate","page_number":102,"box":{"x":70,"y":45,"width":827,"height":11}},{"id":"00bb13c3-08d9-4175-963e-7f48235061e9","block_type":"box","text":"rises above the “strike” rate, the interest rate of the tiered index bond will decrease. Thus, under these","page_number":102,"box":{"x":69,"y":60,"width":738,"height":10}},{"id":"0757c63e-0ac6-4b90-ad58-2a6e21c9d4ee","block_type":"box","text":"circumstances, the interest rate on a tiered index bond, like an inverse floater, will move in the opposite direction of","page_number":102,"box":{"x":69,"y":75,"width":828,"height":11}},{"id":"0b8a8e2b-9855-4b0b-8f75-2aeb95a59b9a","block_type":"box","text":"prevailing interest rates, with the result that the price of the tiered index bond may be considerably more volatile than","page_number":102,"box":{"x":70,"y":90,"width":836,"height":11}},{"id":"efe2d6c4-f7a9-4749-9ad2-0330a79a85cd","block_type":"box","text":"that of a fixed-rate bond.","page_number":102,"box":{"x":68,"y":105,"width":174,"height":9}},{"id":"5a04492e-e5b2-41eb-9b5d-8ee94f5f5e73","block_type":"box","text":"TBA Commitments.","page_number":102,"box":{"x":103,"y":128,"width":133,"height":9}},{"id":"a716441c-2cec-46e0-9536-32dfea538846","block_type":"box","text":"Cer tain Funds may enter into “to be announced” or “TBA” commitments. TBA commitments","page_number":102,"box":{"x":243,"y":128,"width":653,"height":11}},{"id":"09073b24-6f33-4d22-9e93-d2b3a1db47a1","block_type":"box","text":"are forward agreements for the purchase or sale of securities, including mor tgage-backed securities for a fixed price,","page_number":102,"box":{"x":69,"y":143,"width":834,"height":11}},{"id":"060585c1-7270-4d67-9027-1a5ec07362c5","block_type":"box","text":"with payment and delivery on an agreed upon future settlement date. The specific securities to be delivered are not","page_number":102,"box":{"x":68,"y":158,"width":825,"height":11}},{"id":"2ae23521-0a1c-4bdf-88fa-dbecb17916f3","block_type":"box","text":"identified at the trade date. However, delivered securities must meet specified terms, including issuer, rate and","page_number":102,"box":{"x":70,"y":173,"width":793,"height":11}},{"id":"85a1fadf-802d-41a2-8086-3016b288c49a","block_type":"box","text":"mor tgage terms. When the Fund enters into a TBA commitment for the sale of mor tgage-backed securities for a fixed","page_number":102,"box":{"x":69,"y":188,"width":833,"height":12}},{"id":"c6ff9b0c-ebfd-4f7d-a338-8a55f00f3bca","block_type":"box","text":"price, with payment and delivery on an agreed upon future settlement date (which may be referred to as having a","page_number":102,"box":{"x":70,"y":203,"width":804,"height":12}},{"id":"e95a598e-ff51-4f51-986e-d67857fb1a27","block_type":"box","text":"shor t position in such TBA securities), the Fund may or may not hold the types of mor tgage-backed securities","page_number":102,"box":{"x":69,"y":218,"width":779,"height":12}},{"id":"313ad7d0-e1b4-4bf9-bbf2-e37b6f001e45","block_type":"box","text":"required to be delivered. See “—When-Issued Securities, Delayed Delivery Securities and Forward Commitments”","page_number":102,"box":{"x":69,"y":234,"width":810,"height":11}},{"id":"1e22565e-b605-4b68-acbe-b14015642593","block_type":"box","text":"below.","page_number":102,"box":{"x":69,"y":249,"width":43,"height":9}},{"id":"08984b11-072b-4cc4-8860-7260ef3f04c3","block_type":"box","text":"Mor tgage Dollar Rolls.","page_number":102,"box":{"x":102,"y":272,"width":157,"height":11}},{"id":"8bd82023-1b89-4efd-a022-ed53ea8bbee4","block_type":"box","text":"Cer tain Funds may invest in mor tgage dollar rolls. In a mor tgage dollar roll transaction, a","page_number":102,"box":{"x":266,"y":272,"width":634,"height":11}},{"id":"a5bbc425-6041-4e6f-ab43-def731040fba","block_type":"box","text":"Fund sells mor tgage-backed securities for delivery in the current month and simultaneously contracts to repurchase","page_number":102,"box":{"x":70,"y":286,"width":825,"height":12}},{"id":"0f59a737-f15b-4a59-be58-2c1aafc64639","block_type":"box","text":"substantially similar securities on a specified future date. The securities that are repurchased will bear the same","page_number":102,"box":{"x":69,"y":302,"width":805,"height":11}},{"id":"3a85e802-15ce-47fc-b56d-c3832e9aee1c","block_type":"box","text":"interest rate and a similar maturity as those sold, but pools of mor tgages collateralizing those securities may have","page_number":102,"box":{"x":70,"y":317,"width":817,"height":11}},{"id":"b5edd096-b396-4271-8433-c87738ba4063","block_type":"box","text":"different prepayment histories than those sold. During the period between the sale and repurchase, a Fund will not","page_number":102,"box":{"x":69,"y":332,"width":820,"height":11}},{"id":"f28cd636-7b1c-4424-9221-14dd11cbe583","block_type":"box","text":"be entitled to receive interest and principal payments on the securities sold. Proceeds of the sale will be invested in","page_number":102,"box":{"x":69,"y":347,"width":827,"height":11}},{"id":"a03e08b8-a300-4b96-b4e1-cf08e69489b2","block_type":"box","text":"additional instruments for the Fund, and the income from these investments will generate income for the Fund. If","page_number":102,"box":{"x":69,"y":362,"width":806,"height":11}},{"id":"f05a8e52-c737-4822-a712-8229e701105c","block_type":"box","text":"such income does not exceed the income, capital appreciation and gain or loss that would have been realized on the","page_number":102,"box":{"x":69,"y":377,"width":833,"height":12}},{"id":"23c6d74c-a2c8-46eb-82ce-8c47c775c97b","block_type":"box","text":"securities sold as par t of the dollar roll, the use of this technique will diminish the investment per formance of a Fund","page_number":102,"box":{"x":69,"y":392,"width":836,"height":11}},{"id":"9d92a216-5d84-4158-8853-26e2e7b33a65","block_type":"box","text":"compared with what the per formance would have been without the use of dollar rolls.","page_number":102,"box":{"x":69,"y":407,"width":607,"height":11}},{"id":"b4e9d492-090a-45c6-84fb-031610bd7eb9","block_type":"box","text":"Each mor tgage dollar roll transaction is accounted for as a sale or purchase of a por tfolio security and a","page_number":102,"box":{"x":102,"y":430,"width":744,"height":11}},{"id":"6858b9cd-387e-4145-a25b-e3471319ad81","block_type":"box","text":"subsequent purchase or sale of a substantially similar security in the forward market. Transactions in mor tgage","page_number":102,"box":{"x":69,"y":445,"width":796,"height":12}},{"id":"c0ad0e5c-c5c1-4d20-998d-8fcf3c9df67a","block_type":"box","text":"dollar rolls may increase trading costs and por tfolio turnover.","page_number":102,"box":{"x":69,"y":460,"width":433,"height":12}},{"id":"bf2e872b-9ea4-4955-9d13-2429bc64233c","block_type":"box","text":"In the event the buyer of the securities under a mor tgage dollar roll files for bankruptcy or becomes insolvent, a","page_number":102,"box":{"x":102,"y":483,"width":795,"height":11}},{"id":"9ac88a48-6dc8-4766-acb1-a1015987cd28","block_type":"box","text":"Fund’s use of the proceeds of the current sale por tion of the transaction may be restricted pending a determination","page_number":102,"box":{"x":70,"y":498,"width":824,"height":11}},{"id":"07dd3e36-c090-404a-9e65-42d1f116654b","block_type":"box","text":"by the other par ty, or its trustee or receiver, whether to enforce the Fund’s obligation to purchase the similar","page_number":102,"box":{"x":69,"y":513,"width":774,"height":12}},{"id":"6ab7a695-e485-4ce9-ad43-16ee88482cb4","block_type":"box","text":"securities in the forward transaction.","page_number":102,"box":{"x":69,"y":528,"width":261,"height":9}},{"id":"3ebd5520-1324-44a8-9d1a-878b1001284e","block_type":"box","text":"A Fund may engage in dollar roll transactions to enhance returns. Successful use of mor tgage dollar rolls may","page_number":102,"box":{"x":101,"y":551,"width":785,"height":11}},{"id":"846eb315-1136-4235-8e96-288d6304fd33","block_type":"box","text":"depend upon the Manager’s ability to correctly predict interest rates and prepayments. Dollar rolls involve the risk","page_number":102,"box":{"x":69,"y":566,"width":812,"height":11}},{"id":"08e156e2-4af8-4c1f-9498-50f6c05e7340","block_type":"box","text":"that the market value of the securities subject to a Fund’s forward purchase commitment may decline below, or the","page_number":102,"box":{"x":68,"y":581,"width":824,"height":11}},{"id":"b83b43b3-5552-42b2-ad6b-b874d7aec3f3","block_type":"box","text":"market value of the securities subject to a Fund’s forward sale commitment may increase above, the exercise price","page_number":102,"box":{"x":69,"y":596,"width":824,"height":12}},{"id":"1b61b31a-bd66-43a7-8f09-64699ff7d6a8","block_type":"box","text":"of the forward commitment. Dollar rolls are speculative techniques that can be deemed to involve leverage. There is","page_number":102,"box":{"x":69,"y":612,"width":828,"height":11}},{"id":"a3e8b89b-5f48-4608-b489-89251e5b8ebb","block_type":"box","text":"no assurance that dollar rolls can be successfully employed.","page_number":102,"box":{"x":69,"y":627,"width":430,"height":11}},{"id":"c33f3e95-3043-4daa-9ac0-da89c9670927","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into when-issued or forward-settling","page_number":102,"box":{"x":102,"y":649,"width":759,"height":12}},{"id":"80cc5b26-a9b4-42b8-9dd6-d0b8a6549260","block_type":"box","text":"securities (","page_number":102,"box":{"x":69,"y":665,"width":78,"height":11}},{"id":"ae8a6633-cbbf-40e5-9bb0-e67a20279ccc","block_type":"box","text":"e.g.","page_number":102,"box":{"x":148,"y":666,"width":25,"height":10}},{"id":"ae19b717-5a5f-48b0-baae-38e66be9c83d","block_type":"box","text":", dollar rolls and firm and standby commitments, including TBA commitments) and non-standard","page_number":102,"box":{"x":176,"y":664,"width":681,"height":12}},{"id":"44fde90d-d81c-4392-a7ba-3db21a7b68ef","block_type":"box","text":"settlement cycle securities notwithstanding the limitation on the issuance of senior securities in Section 18 of the","page_number":102,"box":{"x":69,"y":680,"width":813,"height":11}},{"id":"aed595e0-1a69-4bb7-8904-594bea605fcb","block_type":"box","text":"Investment Company Act, provided that the transaction meets the Delayed-Settlement Securities Provision (as","page_number":102,"box":{"x":70,"y":695,"width":783,"height":11}},{"id":"59b2a52d-8d09-4d25-b9fd-7cf167d2958d","block_type":"box","text":"defined below under “—When-Issued Securities, Delayed Delivery Securities and Forward Commitments”). If a when","page_number":102,"box":{"x":69,"y":710,"width":832,"height":11}},{"id":"51fe978c-fc84-41c3-9af0-1df8f50657e8","block_type":"box","text":"issued, forward-settling or non-standard settlement cycle security does not satisfy the Delayed-Settlement Securities","page_number":102,"box":{"x":70,"y":725,"width":830,"height":11}},{"id":"557ad8ad-7690-473d-9075-da569a7fbfd3","block_type":"box","text":"Provision, then it is treated as a Derivatives Transaction under Rule 18f-4. See “—Derivatives — Regulation of","page_number":102,"box":{"x":69,"y":740,"width":788,"height":11}},{"id":"1f61c9e2-5901-4daa-9a60-4eecd01af9be","block_type":"box","text":"Derivatives — Rule 18f-4 under the Investment Company Act” above.","page_number":102,"box":{"x":70,"y":755,"width":489,"height":11}},{"id":"f0b98350-9187-4397-9345-77d611c63f75","block_type":"box","text":"Net Interest Margin (NIM) Securities.","page_number":102,"box":{"x":102,"y":778,"width":260,"height":11}},{"id":"688a6228-dfa9-4346-8b11-ed5bd4b2a0c6","block_type":"box","text":"A Fund may invest in net interest margin (“NIM”) securities. These","page_number":102,"box":{"x":368,"y":778,"width":473,"height":11}},{"id":"4d30cd22-a2c9-4984-bfe5-4f7c6e2b07d8","block_type":"box","text":"securities are derivative interest-only mor tgage securities structured off home equity loan transactions. NIM","page_number":102,"box":{"x":69,"y":793,"width":768,"height":11}},{"id":"9cdefb7c-7fc7-4023-89d8-8271b9c8ccd1","block_type":"box","text":"securities receive any “excess” interest computed after paying coupon costs, servicing costs and fees and any credit","page_number":102,"box":{"x":69,"y":808,"width":836,"height":11}},{"id":"ed293a9e-1bdd-4422-8991-528267198fe3","block_type":"box","text":"losses associated with the underlying pool of home equity loans. Like traditional stripped mor tgage-backed","page_number":102,"box":{"x":70,"y":823,"width":760,"height":12}},{"id":"ed36c610-bacc-47cb-8968-a4aac158fb5b","block_type":"box","text":"securities, the yield to maturity on a NIM security is sensitive not only to changes in prevailing interest rates but also","page_number":102,"box":{"x":69,"y":839,"width":832,"height":11}},{"id":"6fbc2c68-4b25-493a-8be5-173b65968192","block_type":"box","text":"to the rate of principal payments (including prepayments) on the underlying home equity loans. NIM securities are","page_number":102,"box":{"x":68,"y":853,"width":810,"height":12}},{"id":"7ce257ac-f8ed-4b27-b0d6-a67e28eff6da","block_type":"box","text":"highly sensitive to credit losses on the underlying collateral and the timing in which those losses are taken.","page_number":102,"box":{"x":69,"y":869,"width":764,"height":11}},{"id":"3fa8e80a-ec9b-4278-a2c6-1ce7e1663dd0","block_type":"box","text":"Municipal Investments.","page_number":102,"box":{"x":102,"y":891,"width":169,"height":11}},{"id":"939973b3-37dd-4fe1-bc33-ef1eb7e315b4","block_type":"box","text":"II-55","page_number":102,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"7e4b6028-9d61-475d-a29a-f64b36dbf53a","block_type":"box","text":"NM1026U-6033063-102/246","page_number":102,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"4d8b55b0-f1a8-4073-a2b6-241237ef2baf","block_type":"box","text":"Cer tain Funds may invest in obligations issued by or on behalf of states, territories and possessions of the","page_number":103,"box":{"x":102,"y":45,"width":763,"height":11}},{"id":"cfec8fc1-0f94-4da5-87e9-975837ffd4ab","block_type":"box","text":"United States and the District of Columbia and their political subdivisions, agencies and instrumentalities, the","page_number":103,"box":{"x":70,"y":60,"width":783,"height":11}},{"id":"06438d8c-d7fa-4895-b9a7-80801409aabf","block_type":"box","text":"payments from which, in the opinion of bond counsel to the issuer, are excludable from gross income for U.S. federal","page_number":103,"box":{"x":70,"y":75,"width":833,"height":11}},{"id":"0f79f4c5-37cc-40d5-8d77-6e55e09ccf17","block_type":"box","text":"income tax purposes (“Municipal Bonds”). Cer tain of the Municipal Funds may also invest in Municipal Bonds that","page_number":103,"box":{"x":70,"y":90,"width":813,"height":11}},{"id":"bc3cd945-3ed9-4063-b6ee-3bf942129ce7","block_type":"box","text":"pay interest excludable from gross income for purposes of state and local income taxes of the designated state and/","page_number":103,"box":{"x":70,"y":105,"width":836,"height":11}},{"id":"0eb03b24-8e0e-42f5-835e-554631c8de68","block_type":"box","text":"or allow the value of a Fund’s shares to be exempt from state and local taxes of the designated state (“State","page_number":103,"box":{"x":69,"y":120,"width":779,"height":12}},{"id":"60f85658-e45b-4b68-a6ce-e78fc58fc50f","block_type":"box","text":"Municipal Bonds”). The Municipal Funds may also invest in securities not issued by or on behalf of a state or territory","page_number":103,"box":{"x":70,"y":135,"width":838,"height":11}},{"id":"ed945593-12ee-43dd-93f0-c4e8f2055846","block_type":"box","text":"or by an agency or instrumentality thereof, if the Manager believes such securities to pay interest excludable from","page_number":103,"box":{"x":69,"y":150,"width":810,"height":12}},{"id":"c58a3899-78c5-4c68-945e-5d3e4014aa8a","block_type":"box","text":"gross income for purposes of U.S. federal income tax and state and local income taxes of the designated state and/","page_number":103,"box":{"x":68,"y":166,"width":834,"height":11}},{"id":"9adfb5de-3fb7-4451-811c-b7640a486a60","block_type":"box","text":"or state and local personal proper ty taxes of the designated state (“Non-Municipal Tax-Exempt Securities”). Non","page_number":103,"box":{"x":69,"y":181,"width":801,"height":11}},{"id":"056881f7-8cb1-4ab4-90a2-c0f80ff38713","block_type":"box","text":"Municipal Tax-Exempt Securities could include trust cer tificates or other instruments evidencing interest in one or","page_number":103,"box":{"x":70,"y":196,"width":807,"height":11}},{"id":"ed69ce06-124b-4b9a-b17d-92d5f9eee61e","block_type":"box","text":"more long-term municipal securities. Non-Municipal Tax-Exempt Securities also may include securities issued by other","page_number":103,"box":{"x":69,"y":211,"width":837,"height":11}},{"id":"8c15ff11-157b-4aab-92db-ce5c20081b63","block_type":"box","text":"investment companies that invest in municipal bonds, to the extent such investments are permitted by applicable","page_number":103,"box":{"x":70,"y":226,"width":809,"height":11}},{"id":"eccd28c8-a6c6-4ec5-a064-d5fca4b999de","block_type":"box","text":"law. Non-Municipal Tax-Exempt Securities that pay interest excludable from gross income for U.S. federal income tax","page_number":103,"box":{"x":70,"y":241,"width":826,"height":11}},{"id":"2e843aff-4f56-493c-9f24-10167b5182de","block_type":"box","text":"purposes will be considered “Municipal Bonds” for purposes of a Municipal Fund’s investment objective and policies.","page_number":103,"box":{"x":70,"y":256,"width":834,"height":11}},{"id":"2ad15f99-2cf1-4ca4-ba1a-7d4487d8941c","block_type":"box","text":"Non-Municipal Tax-Exempt Securities that pay interest excludable from gross income for purposes of U.S. federal","page_number":103,"box":{"x":70,"y":271,"width":800,"height":12}},{"id":"99d11f34-ca79-4130-b547-a0ce8cd83905","block_type":"box","text":"income tax and state and local income taxes of a designated state and/or allow the value of a Fund’s shares to be","page_number":103,"box":{"x":70,"y":286,"width":819,"height":12}},{"id":"4b73da5c-f23c-419f-9a50-59385fe604d9","block_type":"box","text":"exempt from state and local personal proper ty taxes of that state will be considered “State Municipal Bonds” for","page_number":103,"box":{"x":69,"y":302,"width":805,"height":11}},{"id":"a98dcd2c-6c48-41f3-816b-7ff97e521b4c","block_type":"box","text":"purposes of the investment objective and policies of each of California Municipal Oppor tunities Fund, New Jersey","page_number":103,"box":{"x":70,"y":317,"width":805,"height":11}},{"id":"c0a64c66-e412-49d3-9710-58ac95958671","block_type":"box","text":"Municipal Bond Fund, New York Municipal Oppor tunities Fund and Pennsylvania Municipal Bond Fund.","page_number":103,"box":{"x":70,"y":332,"width":721,"height":11}},{"id":"c2842ae3-e437-4229-a755-8b1c99ee78b9","block_type":"box","text":"Risk Factors and Special Considerations Relating to Municipal Bonds.","page_number":103,"box":{"x":102,"y":355,"width":495,"height":11}},{"id":"53ecb86b-b38c-4fae-b341-65d3b3f1a481","block_type":"box","text":"The risks and special considerations","page_number":103,"box":{"x":603,"y":355,"width":260,"height":11}},{"id":"210bfef5-1257-4be4-afd7-0b30f36fbbfc","block_type":"box","text":"involved in investment in Municipal Bonds vary with the types of instruments being acquired. Investments in Non","page_number":103,"box":{"x":70,"y":370,"width":806,"height":11}},{"id":"61317670-1bd1-4369-a502-4c88dc24dc6c","block_type":"box","text":"Municipal Tax-Exempt Securities may present similar risks, depending on the par ticular product. Cer tain municipal","page_number":103,"box":{"x":70,"y":385,"width":810,"height":11}},{"id":"840c423c-67d5-447b-b419-8eb93a9739ea","block_type":"box","text":"instruments in which a Fund may invest may be characterized as derivatives.","page_number":103,"box":{"x":70,"y":400,"width":544,"height":11}},{"id":"ee029424-74e8-4c9f-ae4c-764b468f96f8","block_type":"box","text":"The value of Municipal Bonds generally may be affected by uncer tainties in the municipal markets as a result of","page_number":103,"box":{"x":101,"y":423,"width":799,"height":11}},{"id":"229e78a6-62e3-45ae-984a-86db73485785","block_type":"box","text":"legislation or litigation, including legislation or litigation that changes the taxation of Municipal Bonds or the rights of","page_number":103,"box":{"x":70,"y":438,"width":829,"height":11}},{"id":"50d6a761-518c-4d79-b4cf-97e88b2159d2","block_type":"box","text":"Municipal Bond holders in the event of a bankruptcy. Municipal bankruptcies are rare and cer tain provisions of the","page_number":103,"box":{"x":70,"y":453,"width":814,"height":11}},{"id":"cffae4e3-4867-4fa8-b2dd-a63be327f026","block_type":"box","text":"U.S. Bankruptcy Code governing such bankruptcies are unclear. Fur ther, the application of state law to Municipal","page_number":103,"box":{"x":70,"y":468,"width":802,"height":11}},{"id":"421471fa-6b82-465f-a46f-a6f0e695dcae","block_type":"box","text":"Bond issuers could produce varying results among the states or among Municipal Bond issuers within a state. These","page_number":103,"box":{"x":70,"y":483,"width":834,"height":11}},{"id":"a772ce86-6ca9-4277-a4cd-c1e4e4305153","block_type":"box","text":"uncer tainties could have a significant impact on the prices of the Municipal Bonds in which a Fund invests.","page_number":103,"box":{"x":69,"y":498,"width":761,"height":11}},{"id":"b2cc5bd3-b308-487d-b170-64b0aa58c9dc","block_type":"box","text":"II-56","page_number":103,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"9a125b5d-5307-45bc-b099-1d8306574962","block_type":"box","text":"NM1026U-6033063-103/246","page_number":103,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"636ae835-83cc-452f-aae0-e5c808119f28","block_type":"box","text":"Description of Municipal Bonds.","page_number":104,"box":{"x":70,"y":45,"width":224,"height":11}},{"id":"0598f08e-8afc-49f1-aa89-7aa42e7a04e1","block_type":"box","text":"Municipal Bonds include debt obligations issued to obtain funds for various public purposes, including the","page_number":104,"box":{"x":102,"y":67,"width":754,"height":12}},{"id":"0955b97a-6306-497a-b425-e28cc33b2de1","block_type":"box","text":"construction of a wide range of public facilities, refunding of outstanding obligations and obtaining funds for general","page_number":104,"box":{"x":69,"y":82,"width":824,"height":12}},{"id":"1f854039-53a9-44f4-8204-8d33c82789bd","block_type":"box","text":"operating expenses and loans to other public institutions and facilities. In addition, cer tain types of bonds are issued","page_number":104,"box":{"x":69,"y":98,"width":836,"height":11}},{"id":"305b06c4-9c98-432c-99b3-a1890f6e6298","block_type":"box","text":"by or on behalf of public authorities to finance various privately owned or operated facilities, including cer tain","page_number":104,"box":{"x":69,"y":113,"width":776,"height":11}},{"id":"00a8c1fb-1959-4c77-871b-4bc2a52a91f5","block_type":"box","text":"facilities for the local furnishing of electric energy or gas, sewage facilities, solid waste disposal facilities and other","page_number":104,"box":{"x":68,"y":128,"width":822,"height":11}},{"id":"8ade899c-ce93-491c-a3b9-932f8a380d70","block_type":"box","text":"specialized facilities. Such obligations are included within the term Municipal Bonds if the interest paid thereon is","page_number":104,"box":{"x":69,"y":143,"width":810,"height":11}},{"id":"283bc838-7a0e-4bea-bcfd-7784f7588c79","block_type":"box","text":"excluded from gross income for U.S. federal income tax purposes and any applicable state and local taxes. Other","page_number":104,"box":{"x":69,"y":158,"width":808,"height":11}},{"id":"61d09dc0-5f1a-459c-8774-8eb5219765e5","block_type":"box","text":"types of private activity bonds, the proceeds of which are used for the construction, equipment or improvement of","page_number":104,"box":{"x":68,"y":173,"width":812,"height":11}},{"id":"416f9c91-f517-4977-9489-76b352341352","block_type":"box","text":"privately operated industrial or commercial facilities, may constitute Municipal Bonds, although the current U.S.","page_number":104,"box":{"x":70,"y":188,"width":792,"height":12}},{"id":"7fd09e8a-694d-4c29-86cb-e228c1681704","block_type":"box","text":"federal tax laws place substantial limitations on the size of such issues. The interest on Municipal Bonds may bear a","page_number":104,"box":{"x":68,"y":203,"width":835,"height":12}},{"id":"0155d12d-6963-470b-8d26-f989785c6b50","block_type":"box","text":"fixed rate or be payable at a variable or floating rate. The two principal classifications of Municipal Bonds are “general","page_number":104,"box":{"x":68,"y":218,"width":840,"height":12}},{"id":"4e028e56-bc0a-467e-8d0c-040ae88d03ba","block_type":"box","text":"obligation” and “revenue” or “special obligation” bonds, which latter category includes private activity bonds (“PABs”)","page_number":104,"box":{"x":69,"y":234,"width":838,"height":11}},{"id":"775c7b5d-5851-42e7-8e8d-c6e492a3bc81","block_type":"box","text":"(or “industrial development bonds” under pre-1986 law).","page_number":104,"box":{"x":69,"y":249,"width":401,"height":11}},{"id":"141a3f10-6957-4a66-890c-fe37bf806400","block_type":"box","text":"General Obligation Bonds.","page_number":104,"box":{"x":102,"y":272,"width":184,"height":11}},{"id":"bdbe167a-c97e-419a-bdbb-294d205aa4cc","block_type":"box","text":"General obligation bonds are secured by the issuer’s pledge of its full faith, credit and","page_number":104,"box":{"x":292,"y":271,"width":613,"height":12}},{"id":"9d6063fa-41bb-4787-9c04-a1f7a37ebc8f","block_type":"box","text":"taxing power for the payment of principal and interest. The taxing power of any governmental entity may be limited,","page_number":104,"box":{"x":68,"y":286,"width":816,"height":12}},{"id":"bb722855-20fc-475b-96f0-17718a60ec65","block_type":"box","text":"however, by provisions of its state constitution or laws, and an entity’s creditwor thiness will depend on many factors,","page_number":104,"box":{"x":69,"y":302,"width":834,"height":11}},{"id":"416ba56b-4197-49aa-85d3-85d11334bb42","block_type":"box","text":"including potential erosion of its tax base due to population declines, natural disasters, declines in the state’s","page_number":104,"box":{"x":70,"y":317,"width":786,"height":11}},{"id":"2f5bbe65-22bf-44b4-aca9-d1cea8978065","block_type":"box","text":"industrial base or inability to attract new industries, economic limits on the ability to tax without eroding the tax base,","page_number":104,"box":{"x":70,"y":332,"width":835,"height":11}},{"id":"461feeeb-4752-4840-afb3-2997c43a1374","block_type":"box","text":"state legislative proposals or voter initiatives to limit ad valorem real proper ty taxes and the extent to which the entity","page_number":104,"box":{"x":69,"y":347,"width":840,"height":11}},{"id":"5b0d2dc4-41b3-4ce1-b14e-72fceee9528b","block_type":"box","text":"relies on federal or state aid, access to capital markets or other factors beyond the state’s or entity’s control.","page_number":104,"box":{"x":69,"y":362,"width":782,"height":11}},{"id":"a5d3d65b-e5eb-4d95-bf5c-e3c8ed4c57b8","block_type":"box","text":"Accordingly, the capacity of the issuer of a general obligation bond as to the timely payment of interest and the","page_number":104,"box":{"x":68,"y":377,"width":791,"height":12}},{"id":"34c1556b-e82f-4056-9b90-1a0c7dd32208","block_type":"box","text":"repayment of principal when due is affected by the issuer’s maintenance of its tax base.","page_number":104,"box":{"x":69,"y":392,"width":630,"height":12}},{"id":"0491af4e-19ea-4232-bf9f-b56d992e37a8","block_type":"box","text":"Revenue Bonds.","page_number":104,"box":{"x":102,"y":415,"width":114,"height":9}},{"id":"6917e03a-0d8a-4c8c-8da1-6abb8c4ea6bb","block_type":"box","text":"Revenue bonds are payable only from the revenues derived from a par ticular facility or class of","page_number":104,"box":{"x":223,"y":415,"width":676,"height":11}},{"id":"19a58dfe-0d60-4425-bef9-754aee739790","block_type":"box","text":"facilities or, in some cases, from the proceeds of a special excise tax or other specific revenue source such as","page_number":104,"box":{"x":68,"y":430,"width":791,"height":11}},{"id":"a274e552-bd1a-4eda-a287-3fc3f413dad9","block_type":"box","text":"payments from the user of the facility being financed; accordingly, the timely payment of interest and the repayment","page_number":104,"box":{"x":70,"y":445,"width":824,"height":12}},{"id":"947e5f70-9ae8-486a-a45d-098f58814488","block_type":"box","text":"of principal in accordance with the terms of the revenue or special obligation bond is a function of the economic","page_number":104,"box":{"x":69,"y":460,"width":798,"height":12}},{"id":"23ecbd5d-0c8a-4f53-b70d-476d8dcc18de","block_type":"box","text":"viability of such facility or such revenue source.","page_number":104,"box":{"x":68,"y":475,"width":336,"height":12}},{"id":"adb05652-d651-4a12-b81c-7c43dd474419","block_type":"box","text":"Revenue bonds issued by state or local agencies to finance the development of low-income, multi-family housing","page_number":104,"box":{"x":102,"y":498,"width":801,"height":11}},{"id":"c61a9be7-42fc-47ac-adce-85b8aca13648","block_type":"box","text":"involve special risks in addition to those associated with municipal bonds generally, including that the underlying","page_number":104,"box":{"x":70,"y":514,"width":800,"height":11}},{"id":"a53c68eb-0494-48da-b6b3-59f1ec004b27","block_type":"box","text":"proper ties may not generate sufficient income to pay expenses and interest costs. Such bonds are generally non","page_number":104,"box":{"x":70,"y":528,"width":810,"height":12}},{"id":"2262841d-00eb-411e-b82f-a8d21c1c87d6","block_type":"box","text":"recourse against the proper ty owner, may be junior to the rights of others with an interest in the proper ties, may pay","page_number":104,"box":{"x":69,"y":543,"width":830,"height":12}},{"id":"f09b998b-6fe3-493e-9add-cba7c7360b4c","block_type":"box","text":"interest that changes based in par t on the financial per formance of the proper ty, may be prepayable without penalty","page_number":104,"box":{"x":70,"y":559,"width":828,"height":11}},{"id":"42d11e6b-7104-4ac9-abed-07bf5ed39fa4","block_type":"box","text":"and may be used to finance the construction of housing developments which, until completed and rented, do not","page_number":104,"box":{"x":69,"y":574,"width":804,"height":11}},{"id":"31acdc3c-cd04-4412-9ed3-852263573f7e","block_type":"box","text":"generate income to pay interest. Increases in interest rates payable on senior obligations may make it more difficult","page_number":104,"box":{"x":68,"y":589,"width":830,"height":11}},{"id":"1064c8bb-e2f3-4740-8aa3-5f6279b6d1df","block_type":"box","text":"for issuers to meet payment obligations on subordinated bonds.","page_number":104,"box":{"x":68,"y":604,"width":457,"height":11}},{"id":"025cbb8d-7f6f-4741-a488-b71f1e4c4c77","block_type":"box","text":"PABs.","page_number":104,"box":{"x":102,"y":627,"width":38,"height":9}},{"id":"4ffba10a-e125-4917-bca5-a476b2221aee","block_type":"box","text":"PABs are, in most cases, tax-exempt securities issued by states, municipalities or public authorities to","page_number":104,"box":{"x":147,"y":627,"width":730,"height":11}},{"id":"0e74e860-08c1-473b-b663-9da79303fe25","block_type":"box","text":"provide funds, usually through a loan or lease arrangement, to a private entity for the purpose of financing","page_number":104,"box":{"x":70,"y":642,"width":755,"height":11}},{"id":"51a9fdbe-9ccd-4810-b563-6b2b278edbf6","block_type":"box","text":"construction or improvement of a facility to be used by the entity. Such bonds are secured primarily by revenues","page_number":104,"box":{"x":69,"y":657,"width":797,"height":11}},{"id":"dc556c37-92c5-41df-9b3c-58a721908ffd","block_type":"box","text":"derived from loan repayments or lease payments due from the entity, which may or may not be guaranteed by a","page_number":104,"box":{"x":69,"y":672,"width":793,"height":11}},{"id":"1a65d801-b71e-45d8-b925-fd869f61b753","block_type":"box","text":"parent company or otherwise secured. PABs generally are not secured by a pledge of the taxing power of the issuer of","page_number":104,"box":{"x":70,"y":687,"width":840,"height":11}},{"id":"5bc65d48-bcee-43ac-803f-99b029e0c063","block_type":"box","text":"such bonds. Therefore, an investor should understand that repayment of such bonds generally depends on the","page_number":104,"box":{"x":69,"y":702,"width":789,"height":12}},{"id":"9d3f5075-afb6-46b5-b79f-562174221f5a","block_type":"box","text":"revenues of a private entity and be aware of the risks that such an investment may entail. The continued ability of an","page_number":104,"box":{"x":69,"y":717,"width":832,"height":12}},{"id":"2ee4a3de-62c5-4f47-9e2b-a35186f8560d","block_type":"box","text":"entity to generate sufficient revenues for the payment of principal and interest on such bonds will be affected by","page_number":104,"box":{"x":69,"y":732,"width":802,"height":12}},{"id":"b203672b-aa55-43ee-84e7-97a0edb13143","block_type":"box","text":"many factors including the size of the entity, its capital structure, demand for its products or services, competition,","page_number":104,"box":{"x":69,"y":748,"width":819,"height":11}},{"id":"bdc8a646-d4de-43c9-b34a-b26d3bf81cfd","block_type":"box","text":"general economic conditions, government regulation and the entity’s dependence on revenues for the operation of","page_number":104,"box":{"x":68,"y":763,"width":816,"height":11}},{"id":"52fdf3d8-689b-4f54-ac5b-ab2ed769a092","block_type":"box","text":"the par ticular facility being financed.","page_number":104,"box":{"x":68,"y":778,"width":258,"height":11}},{"id":"85b18665-770e-4a53-be90-0da4b89c05ce","block_type":"box","text":"Moral Obligation Bonds.","page_number":104,"box":{"x":102,"y":801,"width":169,"height":11}},{"id":"7500a24d-240c-456b-ae1d-77204f83ef59","block_type":"box","text":"“Moral obligation” bonds are normally issued by special purpose public authorities. If an","page_number":104,"box":{"x":278,"y":801,"width":628,"height":11}},{"id":"a3e867f5-11c0-40b1-bb0f-524ede4dd56c","block_type":"box","text":"issuer of moral obligation bonds is unable to meet its obligations, the repayment of such bonds becomes a moral","page_number":104,"box":{"x":70,"y":816,"width":809,"height":11}},{"id":"0ec42170-0600-45e7-a986-d498cee81a58","block_type":"box","text":"commitment but not a legal obligation of the state or municipality that created the special purpose public authority","page_number":104,"box":{"x":69,"y":831,"width":816,"height":11}},{"id":"cca693f9-5522-4b11-affe-16a61c4656aa","block_type":"box","text":"that issued the bonds.","page_number":104,"box":{"x":68,"y":846,"width":160,"height":9}},{"id":"d83e1aa3-cf0b-4820-a8d9-db003aeba234","block_type":"box","text":"Municipal Notes.","page_number":104,"box":{"x":102,"y":869,"width":118,"height":11}},{"id":"98e28174-a734-43df-8181-0532451e8844","block_type":"box","text":"Municipal notes are shor ter term municipal debt obligations. They may provide interim financing","page_number":104,"box":{"x":227,"y":869,"width":683,"height":11}},{"id":"1149a866-422b-43b0-a39e-5c4a2592ffca","block_type":"box","text":"in anticipation of tax collection, bond sales or revenue receipts. If there is a shor tfall in the anticipated proceeds,","page_number":104,"box":{"x":70,"y":884,"width":807,"height":11}},{"id":"cd798877-0847-47b8-88b6-c95bf4aaaf8b","block_type":"box","text":"repayment on the note may be delayed or the note may not be fully repaid, and a Fund may lose money.","page_number":104,"box":{"x":69,"y":899,"width":739,"height":11}},{"id":"f842724a-4629-44fc-97ae-d2ef620421e8","block_type":"box","text":"II-57","page_number":104,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"1b41cb16-be19-4ca8-9c04-0f9dcb5eb7fc","block_type":"box","text":"NM1026U-6033063-104/246","page_number":104,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"cc4977ca-f30c-4e28-a666-8264482f2e74","block_type":"box","text":"Municipal Commercial Paper.","page_number":105,"box":{"x":102,"y":45,"width":205,"height":11}},{"id":"0f096396-f207-44c0-813d-26d3903dea13","block_type":"box","text":"Municipal commercial paper is generally unsecured and issued to meet shor t-term","page_number":105,"box":{"x":314,"y":45,"width":586,"height":11}},{"id":"8151a5a7-22cc-4f49-a4c0-689c35bc2a8c","block_type":"box","text":"financing needs. The lack of security presents some risk of loss to a Fund since, in the event of an issuer’s","page_number":105,"box":{"x":68,"y":60,"width":767,"height":11}},{"id":"dd425093-526b-4478-9a43-a0b2b215b6d4","block_type":"box","text":"bankruptcy, unsecured creditors are repaid only after the secured creditors out of the assets, if any, that remain.","page_number":105,"box":{"x":69,"y":75,"width":803,"height":11}},{"id":"aa0126f9-fbeb-45b0-9d99-7cb79dd8d5c6","block_type":"box","text":"Municipal Lease Obligations.","page_number":105,"box":{"x":102,"y":98,"width":203,"height":11}},{"id":"d5ec0165-c0c0-4b10-96e0-be1e4e598b31","block_type":"box","text":"Also included within the general category of Municipal Bonds are cer tificates of","page_number":105,"box":{"x":311,"y":98,"width":566,"height":11}},{"id":"285952fd-abb8-4b52-a16c-132b3daa413e","block_type":"box","text":"par ticipation (“COPs”) issued by government authorities or entities to finance the acquisition or construction of","page_number":105,"box":{"x":70,"y":113,"width":791,"height":11}},{"id":"dc78aeff-fd59-4ba7-b686-dc0e14c9018c","block_type":"box","text":"equipment, land and/or facilities. The COPs represent par ticipations in a lease, an installment purchase contract or a","page_number":105,"box":{"x":69,"y":128,"width":840,"height":11}},{"id":"c15016ca-3d34-4378-af09-e2d536fc168f","block_type":"box","text":"conditional sales contract (hereinafter collectively called “lease obligations”) relating to such equipment, land or","page_number":105,"box":{"x":69,"y":143,"width":800,"height":11}},{"id":"9cb9f7f2-6f09-4893-a703-083018553171","block_type":"box","text":"facilities. Municipal leases, like other municipal debt obligations, are subject to the risk of non-payment. Although","page_number":105,"box":{"x":68,"y":158,"width":809,"height":11}},{"id":"76d35425-7849-4c2c-84ed-d9fe43c4c053","block_type":"box","text":"lease obligations do not constitute general obligations of the issuer for which the issuer’s unlimited taxing power is","page_number":105,"box":{"x":70,"y":173,"width":820,"height":11}},{"id":"29da94ca-466c-4e7c-a437-ffb0c7b2679d","block_type":"box","text":"pledged, a lease obligation is frequently backed by the issuer’s covenant to budget for, appropriate and make the","page_number":105,"box":{"x":70,"y":188,"width":808,"height":12}},{"id":"6f7eb081-16af-44a4-a5cc-fdbeef4787f8","block_type":"box","text":"payments due under the lease obligation. However, cer tain lease obligations contain “non-appropriation” clauses,","page_number":105,"box":{"x":70,"y":204,"width":809,"height":11}},{"id":"1d41b452-4e0a-4999-97a1-f2a5e47a2d41","block_type":"box","text":"which provide that the issuer has no obligation to make lease or installment purchase payments in future years","page_number":105,"box":{"x":68,"y":218,"width":795,"height":12}},{"id":"ae52d5dd-ac07-46cc-a46f-1b2f60f5cc19","block_type":"box","text":"unless money is appropriated for such purpose on a yearly basis. Although “non-appropriation” lease obligations are","page_number":105,"box":{"x":69,"y":234,"width":829,"height":11}},{"id":"635fe7f5-c5ac-495f-8b9f-5779ba688ca9","block_type":"box","text":"secured by the leased proper ty, disposition of the proper ty in the event of foreclosure might prove difficult. These","page_number":105,"box":{"x":69,"y":249,"width":810,"height":11}},{"id":"29a41a8f-cc5a-4f56-adca-65e96f5e9070","block_type":"box","text":"securities represent a type of financing that has not yet developed the depth of marketability associated with more","page_number":105,"box":{"x":69,"y":264,"width":817,"height":11}},{"id":"bb7cb8ac-7436-49a1-bf83-438a1255aab1","block_type":"box","text":"conventional securities. Cer tain investments in lease obligations may be illiquid.","page_number":105,"box":{"x":69,"y":279,"width":572,"height":11}},{"id":"f056dc6f-6c3e-432c-baa4-04abf8a09226","block_type":"box","text":"The ability of issuers of municipal leases to make timely lease payments may be adversely impacted in general","page_number":105,"box":{"x":101,"y":302,"width":791,"height":11}},{"id":"6284d8e5-fc74-477e-82fe-64299b1c07d5","block_type":"box","text":"economic downturns and as relative governmental cost burdens are allocated and reallocated among federal, state","page_number":105,"box":{"x":69,"y":317,"width":822,"height":11}},{"id":"08c40876-6157-404c-9ae2-5ed262589477","block_type":"box","text":"and local governmental units. Such non-payment would result in a reduction of income to a Fund and could result in a","page_number":105,"box":{"x":69,"y":332,"width":837,"height":11}},{"id":"2e00fdad-fe06-424d-9a2f-7dec9aedc25e","block_type":"box","text":"reduction in the value of the municipal lease experiencing non-payment and a potential decrease in the NAV of a","page_number":105,"box":{"x":69,"y":347,"width":798,"height":11}},{"id":"7cbe449f-e215-46ae-9170-01de9f9858f2","block_type":"box","text":"Fund. Issuers of municipal securities might seek protection under the bankruptcy laws. In the event of bankruptcy of","page_number":105,"box":{"x":70,"y":362,"width":828,"height":11}},{"id":"9540d8e3-ac1f-42b4-95dc-90bc0390e06e","block_type":"box","text":"such an issuer, a Fund could experience delays and limitations with respect to the collection of principal and interest","page_number":105,"box":{"x":69,"y":377,"width":833,"height":11}},{"id":"adc6077d-687e-42c0-9be3-469d56613ed1","block_type":"box","text":"on such municipal leases and a Fund may not, in all circumstances, be able to collect all principal and interest to","page_number":105,"box":{"x":69,"y":393,"width":807,"height":11}},{"id":"5980461e-2baa-494f-b543-33a6d161d6c8","block_type":"box","text":"which it is entitled. To enforce its rights in the event of a default in lease payments, a Fund might take possession of","page_number":105,"box":{"x":68,"y":407,"width":835,"height":12}},{"id":"f5e41dfa-1ef1-4f48-90e5-aaca57d1c9b3","block_type":"box","text":"and manage the assets securing the issuer’s obligations on such securities, which may increase a Fund’s operating","page_number":105,"box":{"x":69,"y":423,"width":828,"height":11}},{"id":"038130b2-bd78-4dcd-aff0-e9dab60e935e","block_type":"box","text":"expenses and adversely affect the NAV of a Fund. When the lease contains a non-appropriation clause, however, the","page_number":105,"box":{"x":69,"y":438,"width":829,"height":11}},{"id":"84f03571-fec4-46a0-86eb-aab0efb3dc41","block_type":"box","text":"failure to pay would not be a default and a Fund would not have the right to take possession of the assets. Any","page_number":105,"box":{"x":68,"y":453,"width":793,"height":11}},{"id":"a012faf9-6cfd-4276-9a24-572d6b2ebfed","block_type":"box","text":"income derived from a Fund’s ownership or operation of such assets may not be tax-exempt. In addition, a Fund’s","page_number":105,"box":{"x":70,"y":468,"width":810,"height":11}},{"id":"7638aa36-baa4-47a3-b31b-b518d7b92e0c","block_type":"box","text":"intention to qualify as a “regulated investment company” under the Code, may limit the extent to which a Fund may","page_number":105,"box":{"x":70,"y":483,"width":820,"height":11}},{"id":"39988fba-90b3-4a25-b4de-d0ee93173a1e","block_type":"box","text":"exercise its rights by taking possession of such assets, because as a regulated investment company a Fund is","page_number":105,"box":{"x":69,"y":498,"width":790,"height":11}},{"id":"fbb6f803-eea9-4c14-b721-8e668deffcab","block_type":"box","text":"subject to cer tain limitations on its investments and on the nature of its income.","page_number":105,"box":{"x":69,"y":513,"width":574,"height":11}},{"id":"24949431-9e66-41f5-be19-4ad849188dcb","block_type":"box","text":"Tender Option Bonds.","page_number":105,"box":{"x":103,"y":536,"width":150,"height":11}},{"id":"39d405fc-f4d6-4864-8346-2754d60489b3","block_type":"box","text":"Cer tain Funds may invest in residual inverse floating rate interest tender option bonds","page_number":105,"box":{"x":260,"y":536,"width":613,"height":11}},{"id":"4fd34140-b90e-4c38-8bd2-6de5f56f9d47","block_type":"box","text":"(“TOB Residuals”), which are derivative interests in Municipal Bonds. The TOB Residuals in which the Funds will","page_number":105,"box":{"x":69,"y":551,"width":796,"height":11}},{"id":"83f23b7f-f71d-4e16-8034-8477e43ed988","block_type":"box","text":"invest pay interest or income that, in the opinion of counsel to the issuer, is exempt from regular U.S. federal income","page_number":105,"box":{"x":70,"y":566,"width":834,"height":11}},{"id":"b8c36b1c-aa4f-4ff8-bdbb-d565e2876175","block_type":"box","text":"tax. BlackRock will not conduct its own analysis of the tax status of the interest or income paid by TOB Residuals","page_number":105,"box":{"x":68,"y":581,"width":807,"height":11}},{"id":"ae7f0e11-0175-4f7f-9050-6c34b0b07fc4","block_type":"box","text":"held by the Funds, but will rely on the opinion of counsel to the issuer. Although volatile, TOB Residuals typically offer","page_number":105,"box":{"x":69,"y":596,"width":836,"height":12}},{"id":"708448ba-8f46-4f8f-97c6-561a72ed159b","block_type":"box","text":"the potential for yields exceeding the yields available on fixed rate Municipal Bonds with comparable credit quality.","page_number":105,"box":{"x":68,"y":612,"width":814,"height":11}},{"id":"a636a72a-1dd7-4440-8275-01bf17c6492c","block_type":"box","text":"The Funds may invest in TOB Residuals for the purpose of using economic leverage.","page_number":105,"box":{"x":68,"y":627,"width":598,"height":11}},{"id":"df4dd940-f54c-44ef-ba08-6079fcc15267","block_type":"box","text":"TOB Residuals represent beneficial interests in a special purpose trust formed for the purpose of holding","page_number":105,"box":{"x":101,"y":649,"width":751,"height":12}},{"id":"c9d47abb-4fea-42d6-86cf-afc5efcfd18a","block_type":"box","text":"Municipal Bonds contributed by one or more funds (a “TOB Trust”). A TOB Trust typically issues two classes of","page_number":105,"box":{"x":70,"y":664,"width":786,"height":12}},{"id":"470005bc-c555-47f4-aaa1-4ca4ead69146","block_type":"box","text":"beneficial interests: shor t-term floating rate interests (“TOB Floaters”), which are sold to third-par ty investors, and","page_number":105,"box":{"x":69,"y":680,"width":813,"height":11}},{"id":"240995ec-8e21-43f1-ba70-ae5f9b3d3f9f","block_type":"box","text":"TOB Residuals, which are generally issued to the fund(s) that transferred Municipal Bonds to the TOB Trust. The","page_number":105,"box":{"x":68,"y":695,"width":799,"height":11}},{"id":"1d1be29c-fb04-4b55-82ff-69e1fd7a629d","block_type":"box","text":"Funds may invest in both TOB Floaters and TOB Residuals. TOB Floaters may have first priority on the cash flow from","page_number":105,"box":{"x":70,"y":710,"width":830,"height":11}},{"id":"1aeb2f89-827a-4485-b1d0-17916e2e9829","block_type":"box","text":"the Municipal Bonds held by the TOB Trust and are enhanced with a liquidity suppor t arrangement from a third-par ty","page_number":105,"box":{"x":68,"y":725,"width":828,"height":11}},{"id":"a475716e-d70b-411c-92d3-9e857041af21","block_type":"box","text":"Liquidity Provider (defined below) which allows holders to tender their position at par (plus accrued interest). A Fund,","page_number":105,"box":{"x":70,"y":740,"width":826,"height":11}},{"id":"7887693b-a20d-4c03-a1ca-3d9a663c5fc3","block_type":"box","text":"as a holder of TOB Residuals, is paid the residual cash flow from the TOB Trust. A Fund that contributes the","page_number":105,"box":{"x":69,"y":755,"width":768,"height":11}},{"id":"9d0f66c2-7e68-4084-90fb-10e8942360eb","block_type":"box","text":"Municipal Bonds to the TOB Trust is paid the cash received by the TOB Trust from the sale of the TOB Floaters, less","page_number":105,"box":{"x":70,"y":770,"width":825,"height":11}},{"id":"a77f95b1-94ce-490e-af83-df7c343fd2ee","block_type":"box","text":"cer tain transaction costs, and typically will invest the cash to purchase additional Municipal Bonds or other","page_number":105,"box":{"x":69,"y":786,"width":764,"height":11}},{"id":"e08ccd88-b6e2-4a86-9ae9-522a1c20b397","block_type":"box","text":"investments permitted by its investment policies. If a Fund ever purchases all or a por tion of the TOB Floaters sold by","page_number":105,"box":{"x":70,"y":801,"width":838,"height":11}},{"id":"36dd8d14-4f63-409c-a18c-1c006b8d762d","block_type":"box","text":"the TOB Trust, it may surrender those TOB Floaters together with a propor tionate amount of TOB Residuals to the","page_number":105,"box":{"x":68,"y":816,"width":810,"height":11}},{"id":"b898c92a-038f-4400-910d-6085c45c8b80","block_type":"box","text":"TOB Trust in exchange for a propor tionate amount of the Municipal Bonds owned by the TOB Trust.","page_number":105,"box":{"x":68,"y":831,"width":704,"height":11}},{"id":"2b7a0e8d-346a-4ac1-bc66-9833f02626a3","block_type":"box","text":"Other BlackRock-advised funds may contribute Municipal Bonds to a TOB Trust into which a Fund has contributed","page_number":105,"box":{"x":102,"y":853,"width":804,"height":12}},{"id":"abe73590-2b79-4b2e-991f-a099db13e7ac","block_type":"box","text":"Municipal Bonds. If multiple BlackRock-advised funds par ticipate in the same TOB Trust, the economic rights and","page_number":105,"box":{"x":70,"y":869,"width":805,"height":11}},{"id":"c870289e-c883-4125-abbc-e4a5e122171e","block_type":"box","text":"obligations under the TOB Residual will generally be shared among the funds ratably in propor tion to their","page_number":105,"box":{"x":69,"y":884,"width":752,"height":11}},{"id":"0ae8aac2-21be-48cb-8cfd-a6b4d91920f9","block_type":"box","text":"par ticipation in the TOB Trust.","page_number":105,"box":{"x":70,"y":899,"width":211,"height":11}},{"id":"10b9edd8-1595-41bd-a17c-d247b17ebcf4","block_type":"box","text":"II-58","page_number":105,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"eaaedd90-e71c-4fee-b62c-1d50592cd6d5","block_type":"box","text":"NM1026U-6033063-105/246","page_number":105,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"d77d240b-9663-4a9a-acbf-a9540b2b2ffa","block_type":"box","text":"The Municipal Bonds transferred to a TOB Trust typically are high grade Municipal Bonds. In cer tain cases, when","page_number":106,"box":{"x":101,"y":45,"width":802,"height":11}},{"id":"1038929e-5d18-4d75-bcab-ae0adcedb993","block_type":"box","text":"Municipal Bonds transferred are lower grade Municipal Bonds, the TOB Trust transaction includes a credit","page_number":106,"box":{"x":70,"y":60,"width":753,"height":11}},{"id":"b83f09cd-29de-4bee-af70-3fc32ee47276","block_type":"box","text":"enhancement feature that provides for the timely payment of principal and interest on the bonds to the TOB Trust by","page_number":106,"box":{"x":69,"y":75,"width":829,"height":11}},{"id":"3c7c0a3e-cc9a-4e5f-8b8b-87148532e6d2","block_type":"box","text":"a credit enhancement provider. The TOB Trust would be responsible for the payment of the credit enhancement fee","page_number":106,"box":{"x":69,"y":90,"width":819,"height":11}},{"id":"79eb6ea4-6632-4032-84cc-8f2d96559bdc","block_type":"box","text":"and a Fund, as a TOB Residual holder, would be responsible for reimbursement of any payments of principal and","page_number":106,"box":{"x":69,"y":105,"width":802,"height":11}},{"id":"8b5ff77f-7a83-4d35-8573-c6da0041bc1a","block_type":"box","text":"interest made by the credit enhancement provider.","page_number":106,"box":{"x":70,"y":120,"width":357,"height":11}},{"id":"5cf1034f-dc95-4f2b-bd71-cc68f855a8f0","block_type":"box","text":"The TOB Residuals held by a Fund generally provide the Fund with the right to cause the holders of a propor tional","page_number":106,"box":{"x":101,"y":143,"width":807,"height":11}},{"id":"b6ce64be-7061-4392-9f1f-6b5091722040","block_type":"box","text":"share of the TOB Floaters to tender their notes to the TOB Trust at par plus accrued interest. Thereafter, the Fund","page_number":106,"box":{"x":69,"y":158,"width":810,"height":11}},{"id":"c6911a57-2ce3-4a62-aaa9-1bfdd5acc1ec","block_type":"box","text":"may withdraw a corresponding share of the Municipal Bonds from the TOB Trust. This transaction, in effect, creates","page_number":106,"box":{"x":69,"y":173,"width":825,"height":11}},{"id":"1abd16ba-8060-4614-98f9-23086d2bb7a0","block_type":"box","text":"exposure for the Fund to the entire return of the Municipal Bonds in the TOB Trust, with a net cash investment by the","page_number":106,"box":{"x":69,"y":188,"width":834,"height":11}},{"id":"c94e8507-0d9d-49ed-a792-812ef02c33b3","block_type":"box","text":"Fund that is less than the value of the Municipal Bonds in the TOB Trust. This multiplies the positive or negative","page_number":106,"box":{"x":70,"y":203,"width":797,"height":12}},{"id":"62e034aa-670f-42c5-b9e0-386cd6b97ef2","block_type":"box","text":"impact of the Municipal Bonds’ return within the Fund (thereby creating leverage). The leverage within a TOB Trust","page_number":106,"box":{"x":70,"y":218,"width":809,"height":12}},{"id":"68b38db6-b5e2-4a29-88fd-81bc89219157","block_type":"box","text":"depends on the value of the Municipal Bonds deposited in the TOB Trust relative to the value of the TOB Floaters it","page_number":106,"box":{"x":69,"y":234,"width":820,"height":11}},{"id":"4f90876d-a60b-4759-bb17-3d7a276ae569","block_type":"box","text":"issues.","page_number":106,"box":{"x":70,"y":249,"width":49,"height":9}},{"id":"7656ae35-5b00-449a-9a35-81b13dfd1694","block_type":"box","text":"A Fund may invest in highly leveraged TOB Residuals. A TOB Residual generally is considered highly leveraged if","page_number":106,"box":{"x":101,"y":271,"width":795,"height":12}},{"id":"2b3797d6-2c00-4225-931d-0b5ab26af721","block_type":"box","text":"the principal amount of the TOB Floaters issued by the related TOB Trust exceeds 75% of the principal amount of the","page_number":106,"box":{"x":68,"y":286,"width":833,"height":12}},{"id":"60b35799-2cb3-47a8-a9d4-7ad0af1f85fb","block_type":"box","text":"Municipal Bonds owned by the TOB Trust.","page_number":106,"box":{"x":70,"y":302,"width":293,"height":11}},{"id":"627d0111-352a-44b8-9c47-2045c5955579","block_type":"box","text":"The TOB Trust may be collapsed without the consent of a Fund upon the occurrence of tender option termination","page_number":106,"box":{"x":101,"y":324,"width":802,"height":11}},{"id":"fdf884eb-c55b-49fc-abf1-c3209e4b7ec4","block_type":"box","text":"events (“TOTEs”) and mandatory termination events (“MTEs”), as defined in the TOB Trust agreements. TOTEs","page_number":106,"box":{"x":69,"y":339,"width":788,"height":12}},{"id":"94f4b94b-2edd-458b-81e5-dfcdce8676f2","block_type":"box","text":"include the bankruptcy or default of the issuer of the Municipal Bonds held in the TOB Trust, a substantial downgrade","page_number":106,"box":{"x":70,"y":355,"width":836,"height":11}},{"id":"a77cc08a-faa8-4e45-9e66-592f2fec501e","block_type":"box","text":"in the credit quality of the issuer of the Municipal Bonds held in the TOB Trust, failure of any scheduled payment of","page_number":106,"box":{"x":70,"y":370,"width":819,"height":11}},{"id":"08d41340-7c3c-4f2e-b34e-fded8d0d3c81","block_type":"box","text":"principal or interest on the Municipal Bonds, and a judgment or ruling that interest on the Municipal Bonds is subject","page_number":106,"box":{"x":70,"y":385,"width":833,"height":11}},{"id":"feb756cc-4561-49b0-ac60-ef4007bdfac2","block_type":"box","text":"to U.S. federal income taxation. MTEs may include, among other things, a failed remarketing of the TOB Floaters, the","page_number":106,"box":{"x":68,"y":400,"width":834,"height":11}},{"id":"05cf4d2c-28a6-4e17-87c5-59d9480bb4c5","block_type":"box","text":"inability of the TOB Trust to obtain renewal of the liquidity suppor t agreement, and a substantial decline in the market","page_number":106,"box":{"x":70,"y":415,"width":838,"height":11}},{"id":"11a747ad-05a5-45c2-a91d-65de14957f35","block_type":"box","text":"value of the Municipal Bonds held in the TOB Trust. Upon the occurrence of a TOTE or an MTE, a TOB Trust would be","page_number":106,"box":{"x":68,"y":430,"width":831,"height":11}},{"id":"55ef27ff-72d5-44a8-8a68-ff5921cb71bf","block_type":"box","text":"liquidated with the proceeds applied first to any accrued fees owed to the trustee of the TOB Trust, the remarketing","page_number":106,"box":{"x":70,"y":445,"width":823,"height":12}},{"id":"c89e99f6-fd26-4dc3-b449-e2e26d69208c","block_type":"box","text":"agent of the TOB Floaters and the Liquidity Provider (defined below). In the case of an MTE, after the payment of fees,","page_number":106,"box":{"x":69,"y":460,"width":839,"height":12}},{"id":"526a9c7c-dae2-4f77-b989-9abb4de21dba","block_type":"box","text":"the holders of the TOB Floaters would be paid senior to the TOB Residual holders (","page_number":106,"box":{"x":68,"y":475,"width":589,"height":12}},{"id":"521df6ca-e64c-465c-9497-00f22145f13c","block_type":"box","text":"i.e.","page_number":106,"box":{"x":659,"y":476,"width":21,"height":8}},{"id":"b32c1041-abbd-403b-aadb-70ed43820fa8","block_type":"box","text":", the Fund). In contrast, in the","page_number":106,"box":{"x":682,"y":476,"width":211,"height":11}},{"id":"13069c8b-51e9-435a-a2ed-701b553cc9b1","block_type":"box","text":"case of a TOTE, after payment of fees, the holders of TOB Floaters and the TOB Residual holders would be paid pro","page_number":106,"box":{"x":69,"y":491,"width":822,"height":11}},{"id":"5550eb39-f4c8-44b2-89e4-a9faa848781b","block_type":"box","text":"rata in propor tion to the respective face values of their cer tificates.","page_number":106,"box":{"x":69,"y":506,"width":479,"height":11}},{"id":"5c374dde-23b5-4dc0-8d49-5d1b2bd0d7db","block_type":"box","text":"A Fund may invest in a TOB Trust on either a non-recourse or recourse basis. TOB Trusts are typically suppor ted","page_number":106,"box":{"x":101,"y":529,"width":797,"height":11}},{"id":"a60145ef-69fc-428a-8db4-2685cb72e7c2","block_type":"box","text":"by a liquidity facility provided by a third-par ty bank or other financial institution (the “Liquidity Provider”) that allows","page_number":106,"box":{"x":69,"y":543,"width":815,"height":12}},{"id":"5fad5892-6720-451c-a538-d4aeb5a306d9","block_type":"box","text":"the holders of the TOB Floaters to tender their TOB Floaters in exchange for payment of par plus accrued interest on","page_number":106,"box":{"x":68,"y":559,"width":828,"height":11}},{"id":"2cee945d-b552-444f-a0fd-31767ce7a99a","block_type":"box","text":"any business day (subject to the non-occurrence of a TOTE described above). Depending on the structure of the TOB","page_number":106,"box":{"x":69,"y":574,"width":828,"height":11}},{"id":"c1527074-8d31-4d94-81af-6cb9b2a25e76","block_type":"box","text":"Trust, the Liquidity Provider may purchase the tendered TOB Floaters, or the TOB Trust may draw upon a loan from","page_number":106,"box":{"x":68,"y":589,"width":815,"height":11}},{"id":"bf513280-3e27-4c9e-86c6-a99559b16072","block_type":"box","text":"the Liquidity Provider to purchase the tendered TOB Floaters.","page_number":106,"box":{"x":68,"y":604,"width":434,"height":11}},{"id":"f66c6e2b-f52f-46f8-af0f-45455db3b7d8","block_type":"box","text":"When a Fund invests in TOB Trusts on a non-recourse basis, and the Liquidity Provider is required to make a","page_number":106,"box":{"x":101,"y":627,"width":772,"height":11}},{"id":"a8d3e4a4-5cd4-4dbe-a039-edf1f43fa31e","block_type":"box","text":"payment under the liquidity facility, the Liquidity Provider will typically liquidate all or a por tion of the Municipal Bonds","page_number":106,"box":{"x":70,"y":642,"width":831,"height":11}},{"id":"df8f454d-ab4d-444b-b530-2c7ddc47bc10","block_type":"box","text":"held in the TOB Trust and then fund the balance, if any, of the amount owed under the liquidity facility over the","page_number":106,"box":{"x":69,"y":657,"width":785,"height":11}},{"id":"9208642d-a22d-4e9b-abec-335120181ee2","block_type":"box","text":"liquidation proceeds (the “Liquidation Shor tfall”). If a Fund invests in a TOB Trust on a recourse basis, it will typically","page_number":106,"box":{"x":70,"y":672,"width":831,"height":11}},{"id":"96dc9652-eea6-48d7-896c-32fffa7b1f88","block_type":"box","text":"enter into a reimbursement agreement with the Liquidity Provider pursuant to which the Fund is required to reimburse","page_number":106,"box":{"x":69,"y":687,"width":836,"height":11}},{"id":"f5f0061e-a901-40bd-a37a-fba4d80317d5","block_type":"box","text":"the Liquidity Provider the amount of any Liquidation Shor tfall. As a result, if the Fund invests in a recourse TOB Trust,","page_number":106,"box":{"x":68,"y":702,"width":836,"height":11}},{"id":"1b15df72-7577-4df7-ad46-bd55bbaade78","block_type":"box","text":"the Fund will bear the risk of loss with respect to any Liquidation Shor tfall. If multiple BlackRock-advised funds","page_number":106,"box":{"x":68,"y":717,"width":788,"height":12}},{"id":"d24a0ec3-1398-4bdc-adc8-32a80b533653","block_type":"box","text":"par ticipate in any such TOB Trust, these losses will be shared ratably, in propor tion to their par ticipation in the TOB","page_number":106,"box":{"x":70,"y":733,"width":823,"height":11}},{"id":"556a5060-9eb6-44cd-9e13-21f325fd95d0","block_type":"box","text":"Trust.","page_number":106,"box":{"x":68,"y":748,"width":39,"height":9}},{"id":"9ebf4e08-c4b3-4663-811c-5f4ab5a4d0e2","block_type":"box","text":"Under accounting rules, Municipal Bonds of a Fund that are deposited into a TOB Trust are investments of the","page_number":106,"box":{"x":102,"y":770,"width":784,"height":12}},{"id":"37caeb57-7d4b-4071-a83d-449fdc3fb8de","block_type":"box","text":"Fund and are presented on the Fund’s Schedule of Investments and outstanding TOB Floaters issued by a TOB Trust","page_number":106,"box":{"x":70,"y":785,"width":830,"height":12}},{"id":"c2853660-98b2-4bf8-ae3b-e89634bc8431","block_type":"box","text":"are presented as liabilities in the Fund’s Statement of Assets and Liabilities. Interest income from the underlying","page_number":106,"box":{"x":69,"y":801,"width":806,"height":11}},{"id":"72471d9e-d91a-49c0-901a-f585e43c939f","block_type":"box","text":"Municipal Bonds is recorded by a Fund on an accrual basis. Interest expense incurred on the TOB Floaters and other","page_number":106,"box":{"x":70,"y":816,"width":831,"height":11}},{"id":"64740405-c647-40d9-b79b-b15846e3dad4","block_type":"box","text":"expenses related to remarketing, administration, trustee and other services to a TOB Trust are repor ted as expenses","page_number":106,"box":{"x":69,"y":831,"width":837,"height":11}},{"id":"55a0795e-19dd-48a0-bf7d-fe1506287a66","block_type":"box","text":"of a Fund. In addition, under accounting rules, loans made to a TOB Trust sponsored by a Fund may be presented as","page_number":106,"box":{"x":69,"y":846,"width":832,"height":11}},{"id":"2bccb30b-b0de-4451-bc01-78dd04106f0e","block_type":"box","text":"loans of the Fund in the Fund’s financial statements even if there is no recourse to the Fund’s assets.","page_number":106,"box":{"x":70,"y":861,"width":728,"height":9}},{"id":"92d9a2d9-f329-480b-b8ea-b894d5e8a8b9","block_type":"box","text":"For TOB Floaters, generally, the interest rate earned will be based upon the market rates for Municipal Bonds","page_number":106,"box":{"x":102,"y":884,"width":776,"height":11}},{"id":"fa87f591-667e-4db6-a3f7-7cb29e114cdc","block_type":"box","text":"with maturities or remarketing provisions that are comparable in duration to the periodic interval of the tender option.","page_number":106,"box":{"x":68,"y":899,"width":837,"height":11}},{"id":"464e3d2c-983c-46a6-a4d3-1fa09c02620d","block_type":"box","text":"II-59","page_number":106,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"9da86c50-6d48-4084-bdf9-834f43d87ab9","block_type":"box","text":"NM1026U-6033063-106/246","page_number":106,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"355a41c8-a11c-41a0-9553-1093325a580a","block_type":"box","text":"Since the tender option feature has a shor ter term than the final maturity or first call date of the underlying Municipal","page_number":107,"box":{"x":69,"y":45,"width":836,"height":11}},{"id":"c243cd7f-8adf-491c-89c4-d0b09f47faf3","block_type":"box","text":"Bonds deposited in the TOB Trust, the holder of the TOB Floaters relies upon the terms of the agreement with the","page_number":107,"box":{"x":70,"y":60,"width":809,"height":11}},{"id":"804939d2-3d86-466b-ac24-b0109c8d567e","block_type":"box","text":"financial institution furnishing the liquidity facility as well as the credit strength of that institution. The risk associated","page_number":107,"box":{"x":68,"y":75,"width":836,"height":11}},{"id":"fc789097-ee1d-4f24-96ea-c04daf060143","block_type":"box","text":"with TOB Floaters, however, may be increased in the current market environment as a result of recent downgrades to","page_number":107,"box":{"x":68,"y":90,"width":835,"height":11}},{"id":"5a3b575b-9478-4ad0-bc49-cab1d572a7ed","block_type":"box","text":"the credit ratings, and thus the perceived reliability and creditwor thiness, of many major financial institutions, some","page_number":107,"box":{"x":68,"y":105,"width":827,"height":11}},{"id":"e0aa691e-5cf8-4b60-9365-805a6aaae532","block_type":"box","text":"of which sponsor and/or provide liquidity suppor t to TOB Trusts. This in turn may reduce the desirability of TOB","page_number":107,"box":{"x":69,"y":120,"width":790,"height":11}},{"id":"e0ac1b5d-9ef0-4a6b-b1b7-b48b19f0f6d0","block_type":"box","text":"Floaters as investments, which could impair the viability or availability of TOB Trusts.","page_number":107,"box":{"x":70,"y":135,"width":599,"height":11}},{"id":"e2a72881-28fe-434d-8ff9-89bace9c2ca1","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into TOB Trust transactions, reverse","page_number":107,"box":{"x":102,"y":158,"width":762,"height":11}},{"id":"15edbb44-a761-4e8b-ae3f-c01258dad363","block_type":"box","text":"repurchase agreements and similar financing transactions (e.g., borrowed bonds) notwithstanding the limitation on","page_number":107,"box":{"x":69,"y":173,"width":818,"height":11}},{"id":"4f32dd98-b9f1-459c-b804-b06fab17605a","block_type":"box","text":"the issuance of senior securities in Section 18 of the Investment Company Act, provided that the Fund either","page_number":107,"box":{"x":68,"y":188,"width":778,"height":11}},{"id":"82e5e3a3-5468-4ba7-96e3-121b3f9128e9","block_type":"box","text":"(i) complies with the 300% asset coverage ratio with respect to such transactions and any other borrowings in the","page_number":107,"box":{"x":69,"y":203,"width":811,"height":12}},{"id":"afa8c2aa-9174-4855-9f43-30383ef73bf0","block_type":"box","text":"aggregate, or (ii) treats such transactions as Derivatives Transactions under Rule 18f-4. See “—Derivatives —","page_number":107,"box":{"x":69,"y":218,"width":786,"height":12}},{"id":"962f4e8f-8180-42a6-8193-90c55f03b99e","block_type":"box","text":"Regulation of Derivatives — Rule 18f-4 under the Investment Company Act” above.","page_number":107,"box":{"x":70,"y":234,"width":588,"height":11}},{"id":"9498202a-0896-45f1-a7be-3ba5daf91e93","block_type":"box","text":"Developments in the TOB Trust Market.","page_number":107,"box":{"x":102,"y":256,"width":279,"height":11}},{"id":"3592a874-5185-4316-b267-6c98b71e49ce","block_type":"box","text":"In response to the restrictions imposed by section 619 of the Dodd-Frank Wall Street Reform and Consumer","page_number":107,"box":{"x":102,"y":279,"width":771,"height":11}},{"id":"6edebd17-16d7-4b26-81e0-e3de021cf997","block_type":"box","text":"Protection Act (the “Volcker Rule”), market par ticipants have developed a structure for TOB Trusts designed to","page_number":107,"box":{"x":69,"y":294,"width":786,"height":11}},{"id":"22af3b71-0f8f-4a8c-bfa8-1a441bfae496","block_type":"box","text":"ensure that no banking entity is sponsoring the TOB Trust for purposes of the Volcker Rule. Specifically, a Fund will","page_number":107,"box":{"x":69,"y":309,"width":816,"height":11}},{"id":"28c32a47-f688-435c-99ed-8683dc0eac6f","block_type":"box","text":"establish, structure and “sponsor” the TOB Trusts in which it holds TOB Residuals. In such a structure, cer tain","page_number":107,"box":{"x":69,"y":324,"width":791,"height":11}},{"id":"f1a81ce9-7935-4bd1-a92b-74d7b2b42245","block_type":"box","text":"responsibilities that previously belonged to the sponsor bank will be per formed by, or on behalf of, a Fund. A Fund","page_number":107,"box":{"x":69,"y":339,"width":812,"height":12}},{"id":"4a078658-9bd3-4d6d-a98d-b5370398eb37","block_type":"box","text":"may utilize service providers in meeting these responsibilities. It is possible that regulators could take positions that","page_number":107,"box":{"x":69,"y":355,"width":832,"height":11}},{"id":"42b7122c-5f10-4764-96c0-dd11a9602d32","block_type":"box","text":"could limit the market for such structured TOB Trust transactions or a Fund’s ability to hold TOB Residuals. Under","page_number":107,"box":{"x":69,"y":370,"width":810,"height":11}},{"id":"0fd66b76-1453-42b9-bf33-acf02882716f","block_type":"box","text":"this TOB Trust structure, a Fund has cer tain additional duties and responsibilities, which may give rise to cer tain","page_number":107,"box":{"x":68,"y":385,"width":803,"height":11}},{"id":"6315a924-add4-449c-a26b-eb6218ea29f0","block_type":"box","text":"additional risks including, but not limited to, compliance, securities law and operational risks.","page_number":107,"box":{"x":69,"y":400,"width":665,"height":11}},{"id":"3cc659f1-9d22-4d8b-bfaf-a7c7ce758052","block_type":"box","text":"Under this structure, service providers to a TOB Trust, such as administrators, liquidity providers, trustees, and","page_number":107,"box":{"x":102,"y":423,"width":793,"height":11}},{"id":"cc06a122-373f-4f9f-bd3f-19f7608a6372","block_type":"box","text":"remarketing agents, act at the direction of, and as agent of, a Fund as the TOB Residual holder. Similar to the","page_number":107,"box":{"x":69,"y":438,"width":783,"height":11}},{"id":"dd4f8891-0415-4167-9a14-7dc1b5045fae","block_type":"box","text":"traditional tender option bond structure, a Fund deposits Municipal Bonds into the TOB Trust in exchange for TOB","page_number":107,"box":{"x":68,"y":453,"width":808,"height":11}},{"id":"52d3b4c0-3951-402a-8acc-26b0fc5caf01","block_type":"box","text":"Residuals, the TOB Trust then issues and sells TOB Floaters to third-par ty investors, and the proceeds of the sale of","page_number":107,"box":{"x":70,"y":468,"width":830,"height":11}},{"id":"3e27cc11-ca96-4d0b-9dc5-8e47ec45ea8f","block_type":"box","text":"the TOB Floaters is distributed to such TOB Residual holders (","page_number":107,"box":{"x":68,"y":483,"width":442,"height":11}},{"id":"d9d0c157-6125-419d-a946-ede82d325ac2","block_type":"box","text":"i.e.","page_number":107,"box":{"x":512,"y":483,"width":20,"height":9}},{"id":"cba800a9-761f-4605-960a-60c9111423df","block_type":"box","text":", the Fund). Tendered TOB Floaters continue to be","page_number":107,"box":{"x":535,"y":483,"width":352,"height":11}},{"id":"15a82d98-2b0d-4615-b85f-75c0389b95e9","block_type":"box","text":"suppor ted by a remarketing agent and a liquidity facility. However, the remarketing agent does not purchase tendered","page_number":107,"box":{"x":69,"y":498,"width":836,"height":11}},{"id":"0178af66-2bdd-4c14-afdb-05477c689bc4","block_type":"box","text":"TOB Floaters for its own account in the event of a failed remarketing, which may increase the likelihood that a TOB","page_number":107,"box":{"x":68,"y":513,"width":816,"height":12}},{"id":"ab5377bd-06bb-47f6-929e-691a0b31c683","block_type":"box","text":"Trust will need to be collapsed and liquidated in order to purchase the tendered TOB Floaters. In the event of a failed","page_number":107,"box":{"x":68,"y":528,"width":835,"height":11}},{"id":"91e4b039-081e-4f5a-9eb4-087bdcd93dcb","block_type":"box","text":"remarketing of TOB Floaters, the Liquidity Provider, at its option, may advance a loan to the TOB Trust the proceeds","page_number":107,"box":{"x":69,"y":543,"width":822,"height":12}},{"id":"32965ab9-162d-4756-93bb-3c843d24b548","block_type":"box","text":"of which would be used by the TOB Trust to purchase the tendered TOB Floaters. The Liquidity Provider is not","page_number":107,"box":{"x":69,"y":559,"width":777,"height":11}},{"id":"3c53ed6f-2835-4cb5-99b6-5684b03165a5","block_type":"box","text":"obligated to advance such a loan. The TOB Trust would be the borrower with respect to any such loan. Any loans","page_number":107,"box":{"x":69,"y":574,"width":800,"height":11}},{"id":"70e9449c-8fcb-42a9-a6e8-aafd8a8ba428","block_type":"box","text":"made by a Liquidity Provider will be secured by the purchased TOB Floaters held by the TOB Trust.","page_number":107,"box":{"x":69,"y":589,"width":696,"height":11}},{"id":"4a70d416-58fd-467d-8fc5-cbb4cfd6e8c0","block_type":"box","text":"Similar to the traditional structure for TOB Trusts, a Fund may hold either non-recourse TOB Residuals or","page_number":107,"box":{"x":102,"y":612,"width":745,"height":11}},{"id":"0747c136-73ce-445b-ac13-e8a19bc032b1","block_type":"box","text":"recourse TOB Residuals under this structure. In the event of a Liquidation Shor tfall, there would generally be no","page_number":107,"box":{"x":69,"y":627,"width":797,"height":11}},{"id":"a009bc9a-6414-4d6d-95af-bf4711702b2b","block_type":"box","text":"contractual recourse to the Fund’s assets if the Fund holds a non-recourse TOB Residual. However, as described","page_number":107,"box":{"x":69,"y":642,"width":803,"height":10}},{"id":"c211f734-1759-4bdf-8d7f-5b9da5518a75","block_type":"box","text":"above, a Fund would bear the risk of loss with respect to any Liquidation Shor tfall if it holds a recourse TOB Residual.","page_number":107,"box":{"x":69,"y":657,"width":838,"height":11}},{"id":"037cf882-9957-44b0-9a57-e6755a23c0d9","block_type":"box","text":"The SEC and various federal banking and housing agencies adopted credit risk retention rules for securitizations","page_number":107,"box":{"x":101,"y":680,"width":801,"height":11}},{"id":"7a3cbaa4-9e65-4172-9485-16e91bfb4773","block_type":"box","text":"(the “Risk Retention Rules”), which took effect in December 2016. The Risk Retention Rules require the sponsor of a","page_number":107,"box":{"x":69,"y":695,"width":838,"height":11}},{"id":"1e1c2d12-c2dd-430a-a409-4489de6d7b90","block_type":"box","text":"TOB Trust to retain at least 5% of the credit risk of the underlying assets suppor ting the TOB Trust’s Municipal","page_number":107,"box":{"x":68,"y":710,"width":787,"height":11}},{"id":"e112b3ff-16c0-4d7b-a07a-85608ab0a168","block_type":"box","text":"Bonds. The Risk Retention Rules may adversely affect the Fund’s ability to engage in TOB Trust transactions or","page_number":107,"box":{"x":70,"y":725,"width":791,"height":11}},{"id":"82f7330d-2c15-4fb0-b0af-ee4b1d44ebf2","block_type":"box","text":"increase the costs of such transactions in cer tain circumstances.","page_number":107,"box":{"x":70,"y":740,"width":466,"height":9}},{"id":"29fc5ee1-c44f-42e1-8fd9-6b41c8a75f53","block_type":"box","text":"TOB Trust transactions constitute an impor tant component of the municipal bond market. Accordingly,","page_number":107,"box":{"x":101,"y":763,"width":726,"height":11}},{"id":"1e179793-aa6a-47e3-a648-a2fe3129194c","block_type":"box","text":"implementation of the Volcker Rule may adversely impact the municipal market, including through reduced demand","page_number":107,"box":{"x":70,"y":778,"width":816,"height":11}},{"id":"54b13133-5a83-4acf-8f32-ec27a133616a","block_type":"box","text":"for and liquidity of municipal bonds and increased financing costs for municipal issuers. Any such developments","page_number":107,"box":{"x":68,"y":793,"width":799,"height":11}},{"id":"44fc85a4-ce0f-471c-8bdf-05616d8a3b54","block_type":"box","text":"could adversely affect the Funds. The ultimate impact of these rules on the TOB market and the overall municipal","page_number":107,"box":{"x":69,"y":808,"width":807,"height":11}},{"id":"c3c2da0f-1195-4d89-b32c-91b173e73de2","block_type":"box","text":"market is not yet cer tain.","page_number":107,"box":{"x":69,"y":823,"width":178,"height":11}},{"id":"eb162cd9-a111-470b-879b-9f29c3eae573","block_type":"box","text":"Yields.","page_number":107,"box":{"x":103,"y":846,"width":45,"height":9}},{"id":"f37009f5-4a20-49b1-9b91-2df50445fc05","block_type":"box","text":"Yields on Municipal Bonds are dependent on a variety of factors, including the general condition of the","page_number":107,"box":{"x":154,"y":846,"width":730,"height":11}},{"id":"f1a086f9-ff76-4898-a6e7-10ca80fd6431","block_type":"box","text":"money market and of the municipal bond market, the size of a par ticular offering, the financial condition of the","page_number":107,"box":{"x":69,"y":861,"width":788,"height":11}},{"id":"f7fd931d-7c7e-43c5-885d-21cbaa17dca0","block_type":"box","text":"issuer, the maturity of the obligation and the rating of the issue. The ability of a Fund to achieve its investment","page_number":107,"box":{"x":70,"y":876,"width":787,"height":11}},{"id":"399f87fc-b15c-4abc-b313-024aeb7dd9ba","block_type":"box","text":"objective is also dependent on the continuing ability of the issuers of the securities in which the Fund invests to meet","page_number":107,"box":{"x":69,"y":891,"width":838,"height":12}},{"id":"e9310b16-0128-42be-9da2-92953a5e32e1","block_type":"box","text":"their obligations for the payment of interest and principal when due. There are variations in the risks involved in","page_number":107,"box":{"x":68,"y":906,"width":794,"height":12}},{"id":"a29b629f-6c99-42c0-9bf6-171c297832c0","block_type":"box","text":"II-60","page_number":107,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"7fffe41a-856c-4917-bcbf-9cee19eff50e","block_type":"box","text":"NM1026U-6033063-107/246","page_number":107,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"8a072698-09b0-48d4-88fe-99353ed4e187","block_type":"box","text":"holding Municipal Bonds, both within a par ticular classification and between classifications, depending on numerous","page_number":108,"box":{"x":69,"y":45,"width":831,"height":11}},{"id":"dc5a7d38-cfe3-44c6-95f2-4e51bfb7879e","block_type":"box","text":"factors. Fur thermore, the rights of owners of Municipal Bonds and the obligations of the issuer of such Municipal","page_number":108,"box":{"x":68,"y":60,"width":806,"height":11}},{"id":"f0894520-8d05-4af9-8e16-65bc17fa4077","block_type":"box","text":"Bonds may be subject to applicable bankruptcy, insolvency and similar laws and cour t decisions affecting the rights","page_number":108,"box":{"x":70,"y":75,"width":823,"height":11}},{"id":"b61cf359-5239-4b62-bdcf-87468251b19a","block_type":"box","text":"of creditors generally and to general equitable principles, which may limit the enforcement of cer tain remedies.","page_number":108,"box":{"x":69,"y":90,"width":790,"height":11}},{"id":"431d1038-805b-4577-86c7-555ff24257bf","block_type":"box","text":"Variable Rate Demand Obligations (“VRDOs”).","page_number":108,"box":{"x":103,"y":113,"width":323,"height":11}},{"id":"ee5dad28-c3c4-4eae-98d7-21a107251de8","block_type":"box","text":"VRDOs are tax-exempt obligations that contain a floating or","page_number":108,"box":{"x":432,"y":113,"width":422,"height":11}},{"id":"6cffeb6f-79fa-4c24-94c4-6c25d4154d9f","block_type":"box","text":"variable interest rate adjustment formula and a right of demand on the par t of the holder thereof to receive payment","page_number":108,"box":{"x":68,"y":128,"width":830,"height":11}},{"id":"63a8964c-675d-4ff7-b45a-954731bd1c90","block_type":"box","text":"of the unpaid principal balance plus accrued interest upon a shor t notice period not to exceed seven days.","page_number":108,"box":{"x":69,"y":143,"width":759,"height":11}},{"id":"563bd18a-ada6-41bf-9d87-e5d778959515","block_type":"box","text":"There is the possibility that because of default or insolvency the demand feature of VRDOs may not be honored.","page_number":108,"box":{"x":101,"y":166,"width":798,"height":11}},{"id":"f9a94f29-8aac-4e04-8b42-abcc5797bdf2","block_type":"box","text":"The interest rates are adjustable at periodic intervals to some prevailing market rate for similar investments, such","page_number":108,"box":{"x":68,"y":181,"width":815,"height":11}},{"id":"6eab3938-b7d7-4a8e-8280-a80ad2a91790","block_type":"box","text":"adjustment formula being calculated to maintain the market rate of the VRDOs at approximately the par value of the","page_number":108,"box":{"x":69,"y":196,"width":826,"height":11}},{"id":"36683ee3-5e45-4730-a50a-8d7259cb7083","block_type":"box","text":"VRDOs on the adjustment date. The adjustments typically are based upon the Securities Industry and Financial","page_number":108,"box":{"x":68,"y":211,"width":791,"height":11}},{"id":"7e4fb87f-d6c3-4c8f-9727-acc71858f432","block_type":"box","text":"Markets Association (“SIFMA”) Index.","page_number":108,"box":{"x":70,"y":226,"width":264,"height":11}},{"id":"ca68aa9f-b53d-4445-b4cd-c660c450e741","block_type":"box","text":"Because of the interest rate adjustment formula on VRDOs, VRDOs are not comparable to fixed rate securities.","page_number":108,"box":{"x":102,"y":249,"width":791,"height":11}},{"id":"b09c28c8-df5b-4484-93f6-149f0a0cbbb1","block_type":"box","text":"During periods of declining interest rates, a Fund’s yield on a VRDO will decrease and its shareholders will forego the","page_number":108,"box":{"x":70,"y":264,"width":833,"height":11}},{"id":"5e8a1f13-c3e2-49dd-ab50-86fc691b5d64","block_type":"box","text":"oppor tunity for capital appreciation. During periods of rising interest rates, however, a Fund’s yield on a VRDO will","page_number":108,"box":{"x":69,"y":279,"width":808,"height":11}},{"id":"db1b8e38-45bc-49cf-ae91-bf6b34c25e6e","block_type":"box","text":"increase and the Fund’s shareholders will have a reduced risk of capital depreciation.","page_number":108,"box":{"x":70,"y":294,"width":608,"height":11}},{"id":"d3670671-1f2c-4d3f-adda-18025fa6369b","block_type":"box","text":"Transactions in Financial Futures Contracts on Municipal Indexes.","page_number":108,"box":{"x":103,"y":317,"width":465,"height":11}},{"id":"9302a6b6-d7b0-4cf0-b621-8b977ea3ae4f","block_type":"box","text":"The Municipal Funds and cer tain other funds","page_number":108,"box":{"x":574,"y":317,"width":318,"height":11}},{"id":"f2fe6dc3-4d34-4707-9f19-4b29deb17629","block_type":"box","text":"deal in financial futures contracts based on a long-term municipal bond index developed by the Chicago Board of","page_number":108,"box":{"x":69,"y":332,"width":803,"height":11}},{"id":"3f5148b2-b5f5-4ae9-9659-b6cb7b8ebcc8","block_type":"box","text":"Trade (“CBT”) and The Bond Buyer (the “Municipal Bond Index”). The Municipal Bond Index is comprised of 40 long","page_number":108,"box":{"x":68,"y":347,"width":825,"height":11}},{"id":"1738d355-b187-498a-8994-91baa9de7f21","block_type":"box","text":"term, actively traded tax-exempt municipal revenue and general obligation bonds. Each bond included in the Municipal","page_number":108,"box":{"x":68,"y":362,"width":840,"height":11}},{"id":"588b7d06-df72-44fd-97f8-53df33172bed","block_type":"box","text":"Bond Index must be rated A or higher by Moody’s or S&P and must have a remaining maturity of 19 years or more.","page_number":108,"box":{"x":70,"y":377,"width":815,"height":12}},{"id":"ca670eaf-8513-4e2f-bdcb-1daa09296afc","block_type":"box","text":"Twice a month new issues satisfying the eligibility requirements are added to, and an equal number of old issues are","page_number":108,"box":{"x":68,"y":392,"width":836,"height":12}},{"id":"753bd4b4-78ca-45d4-9d57-73602736d4a8","block_type":"box","text":"deleted from, the Municipal Bond Index. The value of the Municipal Bond Index is computed daily according to a","page_number":108,"box":{"x":69,"y":407,"width":796,"height":12}},{"id":"ca87a729-adef-4183-aef4-ea4a2f6835ed","block_type":"box","text":"formula based on the price of each bond in the Municipal Bond Index, as evaluated by six dealer-to-dealer brokers.","page_number":108,"box":{"x":68,"y":423,"width":816,"height":11}},{"id":"3c980a2f-61c8-489d-9cf2-69bff8216fd3","block_type":"box","text":"The Municipal Bond Index futures contract is traded only on the CBT. Like other contract markets, the CBT","page_number":108,"box":{"x":101,"y":445,"width":756,"height":11}},{"id":"8d16e375-b935-4514-8a39-c43e008f5abb","block_type":"box","text":"assures per formance under futures contracts through a clearing corporation, a nonprofit organization managed by the","page_number":108,"box":{"x":69,"y":460,"width":839,"height":12}},{"id":"eeaa37eb-5fc6-4485-ac5b-ab09304d621f","block_type":"box","text":"exchange membership that is also responsible for handling daily accounting of deposits or withdrawals of margin.","page_number":108,"box":{"x":69,"y":475,"width":808,"height":12}},{"id":"ee5021e5-40c3-4250-8903-6ae0f6b5e6ec","block_type":"box","text":"The par ticular municipal bonds comprising the index underlying the Municipal Bond Index financial futures","page_number":108,"box":{"x":101,"y":498,"width":753,"height":11}},{"id":"8416fc22-bcf0-4ad2-92a0-7e5582b143bf","block_type":"box","text":"contract may vary from the bonds held by a Municipal Fund. As a result, a Municipal Fund’s ability to hedge","page_number":108,"box":{"x":69,"y":513,"width":764,"height":12}},{"id":"7071b445-0a6d-4008-aba7-235f308cf8da","block_type":"box","text":"effectively all or a por tion of the value of its Municipal Bonds through the use of such financial futures contracts will","page_number":108,"box":{"x":69,"y":528,"width":826,"height":12}},{"id":"9ea2c113-c897-478e-b879-c869f4aba8ca","block_type":"box","text":"depend in par t on the degree to which price movements in the index underlying the financial futures contract","page_number":108,"box":{"x":69,"y":543,"width":774,"height":12}},{"id":"a38178ea-361b-4f91-acf6-55f8ab7b631d","block_type":"box","text":"correlate with the price movements of the Municipal Bonds held by the Fund. The correlation may be affected by","page_number":108,"box":{"x":69,"y":559,"width":801,"height":11}},{"id":"d566400f-56d0-4bdf-809d-1d9d87fc2177","block_type":"box","text":"disparities in the average maturity, ratings, geographical mix or structure of a Municipal Fund’s investments as","page_number":108,"box":{"x":69,"y":574,"width":788,"height":11}},{"id":"d3069ba5-8336-4c12-a6c1-1afad7a8d7ed","block_type":"box","text":"compared to those comprising the Municipal Bond Index and general economic or political factors. In addition, the","page_number":108,"box":{"x":69,"y":589,"width":812,"height":11}},{"id":"4803109e-5299-44a2-a5b6-5d5d9f5051ea","block_type":"box","text":"correlation between movements in the value of the Municipal Bond Index may be subject to change over time as","page_number":108,"box":{"x":69,"y":604,"width":799,"height":11}},{"id":"62759b63-2f5c-41b1-ae01-8862a579b753","block_type":"box","text":"additions to and deletions from the Municipal Bond Index alter its structure. The correlation between futures","page_number":108,"box":{"x":69,"y":619,"width":772,"height":11}},{"id":"11bd4759-42af-4bc9-b96b-f3ac8cfc18a1","block_type":"box","text":"contracts on U.S. Government Securities and the Municipal Bonds held by a Municipal Fund may be adversely","page_number":108,"box":{"x":69,"y":634,"width":782,"height":11}},{"id":"36eed226-65f2-4afc-9000-07a78625b34d","block_type":"box","text":"affected by similar factors and the risk of imper fect correlation between movements in the prices of such futures","page_number":108,"box":{"x":69,"y":649,"width":806,"height":12}},{"id":"833a6667-b5ec-4344-958f-2b55d6e9adbb","block_type":"box","text":"contracts and the prices of Municipal Bonds held by a Municipal Fund may be greater. Municipal Bond Index futures","page_number":108,"box":{"x":69,"y":664,"width":823,"height":12}},{"id":"cc1cd1ae-8adf-4b77-b9b6-f84596f2bf3f","block_type":"box","text":"contracts were approved for trading in 1985. Trading in such futures contracts may tend to be less liquid than trading","page_number":108,"box":{"x":69,"y":680,"width":837,"height":11}},{"id":"c7367c4d-cd01-4313-b5c4-271df8b97bd2","block_type":"box","text":"in other futures contracts. The trading of futures contracts also is subject to cer tain market risks, such as inadequate","page_number":108,"box":{"x":70,"y":695,"width":839,"height":11}},{"id":"221e5553-282a-4b2a-b3f5-a08179fbdd40","block_type":"box","text":"trading activity, which could at times make it difficult or impossible to liquidate existing positions.","page_number":108,"box":{"x":68,"y":710,"width":693,"height":11}},{"id":"44d64ca0-0d84-431d-8930-a43fbbf6b434","block_type":"box","text":"Call Rights.","page_number":108,"box":{"x":102,"y":733,"width":79,"height":11}},{"id":"8ed59787-d8a8-4531-b91a-26a725b7bfe1","block_type":"box","text":"A Fund may purchase a Municipal Bond issuer’s right to call all or a por tion of such Municipal Bond","page_number":108,"box":{"x":187,"y":732,"width":708,"height":12}},{"id":"700cd029-b16a-4c66-a809-ba2f4233d2ae","block_type":"box","text":"for mandatory tender for purchase (a “Call Right”). A holder of a Call Right may exercise such right to require a","page_number":108,"box":{"x":68,"y":748,"width":790,"height":11}},{"id":"01e5ea1d-32f4-441d-9ed6-19ea046debc6","block_type":"box","text":"mandatory tender for the purchase of related Municipal Bonds, subject to cer tain conditions. A Call Right that is not","page_number":108,"box":{"x":69,"y":763,"width":827,"height":11}},{"id":"f9a0857f-b422-492a-acb8-2e1e4967e6db","block_type":"box","text":"exercised prior to maturity of the related Municipal Bond will expire without value. The economic effect of holding","page_number":108,"box":{"x":69,"y":778,"width":805,"height":11}},{"id":"e69f4436-3e8a-4d65-ba06-35efee9fb836","block_type":"box","text":"both the Call Right and the related Municipal Bond is identical to holding a Municipal Bond as a non-callable security.","page_number":108,"box":{"x":69,"y":793,"width":833,"height":11}},{"id":"6aa1f281-b159-4d58-9e8e-45b0744cd66b","block_type":"box","text":"Cer tain investments in such obligations may be illiquid.","page_number":108,"box":{"x":69,"y":808,"width":393,"height":11}},{"id":"4ab8431b-74cb-446d-8e79-78825005c8b4","block_type":"box","text":"Municipal Interest Rate Swap Transactions.","page_number":108,"box":{"x":102,"y":831,"width":307,"height":11}},{"id":"4c13feda-9ac0-4cec-884c-46f1bdafb846","block_type":"box","text":"In order to hedge the value of a Fund against interest rate","page_number":108,"box":{"x":417,"y":831,"width":411,"height":11}},{"id":"cd2cb396-743e-474c-8fdc-4f28192c2775","block_type":"box","text":"fluctuations or to enhance a Fund’s income, a Fund may enter into interest rate swap transactions such as Municipal","page_number":108,"box":{"x":68,"y":846,"width":835,"height":11}},{"id":"445d5ead-e3ef-40ba-ac6f-c4ddf1abe07a","block_type":"box","text":"Market Data AAA Cash Curve swaps (“MMD Swaps”) or Securities Industry and Financial Markets Association","page_number":108,"box":{"x":70,"y":861,"width":781,"height":11}},{"id":"969aea22-ff2e-4da0-9372-d3d5c1a0c4b1","block_type":"box","text":"Municipal Swap Index swaps (“SIFMA Swaps”). To the extent that a Fund enters into these transactions, the Fund","page_number":108,"box":{"x":70,"y":876,"width":808,"height":11}},{"id":"768607bd-ce39-4bd7-932b-2e0dd698a811","block_type":"box","text":"expects to do so primarily to preserve a return or spread on a par ticular investment or por tion of its por tfolio or to","page_number":108,"box":{"x":69,"y":891,"width":814,"height":11}},{"id":"cc70420d-e5cf-4848-83fb-966c2472e8b2","block_type":"box","text":"protect against any increase in the price of securities the Fund anticipates purchasing at a later date. A Fund intends","page_number":108,"box":{"x":70,"y":906,"width":832,"height":12}},{"id":"422ee94d-1b6e-4fd3-856e-34443a9a8660","block_type":"box","text":"II-61","page_number":108,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"3eed6a3a-9b5c-4037-8242-82230afdb4f9","block_type":"box","text":"NM1026U-6033063-108/246","page_number":108,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"5c845f05-9631-4333-8b3e-964cb03e357b","block_type":"box","text":"to use these transactions primarily as a hedge rather than as a speculative investment. However, a Fund also may","page_number":109,"box":{"x":68,"y":45,"width":817,"height":11}},{"id":"b1e6fe21-ef15-4a6e-99f3-c5fb2ef41823","block_type":"box","text":"invest in MMD Swaps and SIFMA Swaps to enhance income or gain or to increase the Fund’s yield, for example,","page_number":109,"box":{"x":70,"y":60,"width":797,"height":11}},{"id":"04833969-4ee1-4015-b7dd-8d5d22181ab3","block_type":"box","text":"during periods of steep interest rate yield curves (","page_number":109,"box":{"x":69,"y":75,"width":356,"height":11}},{"id":"1c735a74-062f-452f-8255-c74e6bf045c4","block_type":"box","text":"i.e.","page_number":109,"box":{"x":427,"y":75,"width":20,"height":9}},{"id":"4b7aeb4a-c809-4bdd-8098-b63945152d98","block_type":"box","text":", wide differences between shor t-term and long-term interest","page_number":109,"box":{"x":449,"y":75,"width":433,"height":11}},{"id":"e57c686a-a12a-4083-a009-578fd1ca0009","block_type":"box","text":"rates).","page_number":109,"box":{"x":69,"y":90,"width":44,"height":11}},{"id":"4ae1ac6c-6824-41cb-bdfd-3cd39814e54d","block_type":"box","text":"A Fund may purchase and sell SIFMA Swaps in the SIFMA swap market. In a SIFMA Swap, a Fund exchanges with","page_number":109,"box":{"x":101,"y":113,"width":807,"height":11}},{"id":"305ea459-a61c-482d-8852-41aada223a64","block_type":"box","text":"another par ty their respective commitments to pay or receive interest (","page_number":109,"box":{"x":69,"y":128,"width":503,"height":11}},{"id":"b64869c3-9c62-49c1-9d68-d7a4ff19e078","block_type":"box","text":"e.g.","page_number":109,"box":{"x":574,"y":129,"width":25,"height":10}},{"id":"3ac85c3e-212e-42e4-ab09-9497c555da62","block_type":"box","text":", an exchange of fixed rate payments for","page_number":109,"box":{"x":601,"y":128,"width":286,"height":11}},{"id":"68e2dec4-75fa-4f47-803d-36f7527be315","block_type":"box","text":"floating rate payments linked to the SIFMA Municipal Swap Index). Because the underlying index is a tax-exempt","page_number":109,"box":{"x":68,"y":143,"width":798,"height":11}},{"id":"e39ef10a-b35c-4c9e-809b-29228ead6502","block_type":"box","text":"index, SIFMA Swaps may reduce cross-market risks incurred by a Fund and increase a Fund’s ability to hedge","page_number":109,"box":{"x":70,"y":158,"width":778,"height":11}},{"id":"029a4fc4-9a3a-43d0-92d5-eff7120dee52","block_type":"box","text":"effectively. SIFMA Swaps are typically quoted for the entire yield curve, beginning with a seven day floating rate index","page_number":109,"box":{"x":69,"y":173,"width":833,"height":11}},{"id":"ab1bc258-1d1c-4fb8-8798-12c5bfa8ba05","block_type":"box","text":"out to 30 years. The duration of a SIFMA Swap is approximately equal to the duration of a fixed-rate Municipal Bond","page_number":109,"box":{"x":69,"y":188,"width":823,"height":11}},{"id":"7ea2075d-7b5f-4aac-8ba6-5329f73ed51d","block_type":"box","text":"with the same attributes as the swap (","page_number":109,"box":{"x":68,"y":204,"width":275,"height":10}},{"id":"a7810d0d-c695-49c3-9a9f-b100179d2256","block_type":"box","text":"e.g.","page_number":109,"box":{"x":345,"y":205,"width":24,"height":10}},{"id":"df8c001f-7558-458b-9576-bf7e73dac960","block_type":"box","text":", coupon, maturity, call feature).","page_number":109,"box":{"x":372,"y":203,"width":224,"height":12}},{"id":"3a58d1bf-1a19-423d-8cbd-31446e9b2471","block_type":"box","text":"A Fund may also purchase and sell MMD Swaps, also known as MMD rate locks. An MMD Swap permits a Fund","page_number":109,"box":{"x":101,"y":226,"width":797,"height":11}},{"id":"32e26057-5b5e-4f36-b030-bdd3c346bc53","block_type":"box","text":"to lock in a specified municipal interest rate for a por tion of its por tfolio to preserve a return on a par ticular","page_number":109,"box":{"x":68,"y":241,"width":770,"height":11}},{"id":"fe7348c1-d2d1-431d-984e-df152b35f8b0","block_type":"box","text":"investment or a por tion of its por tfolio as a duration management technique or to protect against any increase in the","page_number":109,"box":{"x":70,"y":256,"width":832,"height":12}},{"id":"3016f04c-f14e-4b89-abcb-e2e16c0a49ca","block_type":"box","text":"price of securities to be purchased at a later date. By using an MMD Swap, a Fund can create a synthetic long or","page_number":109,"box":{"x":70,"y":271,"width":805,"height":12}},{"id":"88688b23-0bf8-4857-b72d-ff150a186350","block_type":"box","text":"shor t position, allowing the Fund to select the most attractive par t of the yield curve. An MMD Swap is a contract","page_number":109,"box":{"x":69,"y":286,"width":808,"height":12}},{"id":"2e497504-c912-4391-ad4f-6cb4d4dd857d","block_type":"box","text":"between a Fund and an MMD Swap provider pursuant to which the par ties agree to make payments to each other on","page_number":109,"box":{"x":69,"y":302,"width":832,"height":11}},{"id":"db7fb3a9-8ea6-41c5-8b60-86d61545dce3","block_type":"box","text":"a notional amount, contingent upon whether the Municipal Market Data AAA General Obligation Scale is above or","page_number":109,"box":{"x":69,"y":317,"width":804,"height":11}},{"id":"7c2c8539-31f2-4b62-ad8e-19cc01b347f7","block_type":"box","text":"below a specified level on the expiration date of the contract. For example, if a Fund buys an MMD Swap and the","page_number":109,"box":{"x":69,"y":332,"width":803,"height":11}},{"id":"083b901f-5c63-425f-b15a-0eb9af683ab0","block_type":"box","text":"Municipal Market Data AAA General Obligation Scale is below the specified level on the expiration date, the","page_number":109,"box":{"x":70,"y":347,"width":763,"height":11}},{"id":"5c2ba8e0-eef7-4ec2-af19-daff631ee1f0","block_type":"box","text":"counterpar ty to the contract will make a payment to the Fund equal to the specified level minus the actual level,","page_number":109,"box":{"x":69,"y":362,"width":797,"height":11}},{"id":"507354c9-13bc-48d8-9950-ef5461faf2e1","block_type":"box","text":"multiplied by the notional amount of the contract. If the Municipal Market Data AAA General Obligation Scale is above","page_number":109,"box":{"x":69,"y":377,"width":836,"height":12}},{"id":"3e024ecf-c66d-4309-8f4d-1e1dfff8e808","block_type":"box","text":"the specified level on the expiration date, a Fund will make a payment to the counterpar ty equal to the actual level","page_number":109,"box":{"x":68,"y":392,"width":816,"height":12}},{"id":"f83f71be-b815-4ebc-b6bd-460fe9f6df86","block_type":"box","text":"minus the specified level, multiplied by the notional amount of the contract.","page_number":109,"box":{"x":69,"y":407,"width":537,"height":12}},{"id":"db7c1b05-25d0-426d-a900-974bc76eb433","block_type":"box","text":"In connection with investments in SIFMA and MMD Swaps, there is a risk that municipal yields will move in the","page_number":109,"box":{"x":102,"y":430,"width":788,"height":11}},{"id":"29826afc-321e-492c-9919-d3659b470be4","block_type":"box","text":"opposite direction than anticipated by a Fund, which would cause the Fund to make payments to its counterpar ty in","page_number":109,"box":{"x":69,"y":446,"width":821,"height":10}},{"id":"05c67879-4f5b-4b1b-8aca-e66fcdbae3a1","block_type":"box","text":"the transaction that could adversely affect the Fund’s per formance.","page_number":109,"box":{"x":68,"y":460,"width":482,"height":12}},{"id":"9f18f74f-073e-4aa9-a04c-178a6724a2d6","block_type":"box","text":"Insured Municipal Bonds.","page_number":109,"box":{"x":102,"y":483,"width":179,"height":11}},{"id":"4c0b7857-26b1-4647-abf8-b8c91f347596","block_type":"box","text":"Bonds purchased by a Fund may be covered by insurance that guarantees that interest","page_number":109,"box":{"x":288,"y":483,"width":619,"height":11}},{"id":"d24ab7bd-e36c-4fe6-94db-b26f823e4db0","block_type":"box","text":"payments on the bond will be made on time and the principal will be repaid when the bond matures. Either the issuer","page_number":109,"box":{"x":70,"y":498,"width":835,"height":11}},{"id":"a45216eb-b0e4-48fb-a0ec-7db74df07199","block_type":"box","text":"of the bond or the Fund purchases the insurance. Insurance is expected to protect the Fund against losses caused by","page_number":109,"box":{"x":69,"y":513,"width":840,"height":12}},{"id":"4e3aac1b-faf6-4ae6-acc4-1353397396b5","block_type":"box","text":"a bond issuer’s failure to make interest or principal payments. However, insurance does not protect the Fund or its","page_number":109,"box":{"x":69,"y":528,"width":818,"height":12}},{"id":"fb39fb7c-387f-4c8c-954b-4c536b8aeffa","block_type":"box","text":"shareholders against losses caused by declines in a bond’s market value. Also, the Fund cannot be cer tain that any","page_number":109,"box":{"x":69,"y":544,"width":829,"height":11}},{"id":"b43d9b35-aa6f-47e2-a36a-4f247aa07d87","block_type":"box","text":"insurance company does not make these payments. In addition, if the Fund purchases the insurance, it may pay the","page_number":109,"box":{"x":70,"y":559,"width":827,"height":11}},{"id":"2ffa32ea-6268-4b84-8e69-73a0f87fd434","block_type":"box","text":"premiums, which will reduce the Fund’s yield. The Fund seeks to use only insurance companies with claims paying","page_number":109,"box":{"x":70,"y":574,"width":815,"height":11}},{"id":"50f9a645-2047-435a-bd5f-c719b9c9c07c","block_type":"box","text":"ability, financial strength, or equivalent ratings of at least investment grade. However, if insurance from insurers with","page_number":109,"box":{"x":69,"y":589,"width":829,"height":11}},{"id":"4c08395a-be08-49f5-8a26-84e3e3db3ef1","block_type":"box","text":"these ratings is not available, the Fund may use insurance companies with lower ratings or stop purchasing","page_number":109,"box":{"x":68,"y":604,"width":767,"height":11}},{"id":"65a04b4b-24c8-443c-be9f-b6c3a9269a44","block_type":"box","text":"insurance or insured bonds. If a bond’s insurer fails to fulfill its obligations or loses its credit rating, the value of the","page_number":109,"box":{"x":70,"y":619,"width":827,"height":11}},{"id":"eef926a4-c8fd-4dac-a84a-94588b5b9d89","block_type":"box","text":"bond could drop.","page_number":109,"box":{"x":69,"y":634,"width":118,"height":11}},{"id":"aeff1791-2901-495d-b5eb-33a77aad6fea","block_type":"box","text":"Build America Bonds.","page_number":109,"box":{"x":102,"y":657,"width":150,"height":9}},{"id":"788f60de-ae46-4bc5-89e4-61f3efb4999f","block_type":"box","text":"If a Fund holds Build America Bonds, the Fund may be eligible to receive a U.S. federal","page_number":109,"box":{"x":259,"y":657,"width":616,"height":11}},{"id":"c405b2a4-59c5-4317-a534-d40bd967bfb9","block_type":"box","text":"income tax credit; however, the issuer of a Build America Bond may instead elect to receive a cash payment directly","page_number":109,"box":{"x":70,"y":672,"width":825,"height":11}},{"id":"c9955ced-5681-4371-9ee3-6f0db4233dc3","block_type":"box","text":"from the federal government in lieu of holders such as the fund receiving a tax credit. The interest on Build America","page_number":109,"box":{"x":68,"y":687,"width":824,"height":11}},{"id":"6166d3ca-8cce-4b73-ba21-278f7c89adb1","block_type":"box","text":"Bonds is taxable for U.S. federal income tax purposes. If the Fund does receive tax credits from Build America Bonds","page_number":109,"box":{"x":70,"y":702,"width":833,"height":11}},{"id":"d128467a-2ff7-40ff-9266-b71f78258721","block_type":"box","text":"or other tax credit bonds on one or more specified dates during the fund’s taxable year, and the Fund satisfies the","page_number":109,"box":{"x":69,"y":717,"width":815,"height":12}},{"id":"60f399e6-1f3a-420e-ba21-1c488836d238","block_type":"box","text":"minimum distribution requirement, the Fund may elect for U.S. federal income tax purposes to pass through to","page_number":109,"box":{"x":69,"y":732,"width":788,"height":12}},{"id":"b55d6f03-4960-4d2e-8787-f0db8d5b5182","block_type":"box","text":"shareholders tax credits otherwise allowable to the Fund for that year with respect to such bonds. A tax credit bond","page_number":109,"box":{"x":69,"y":748,"width":823,"height":11}},{"id":"00725e6d-3e1e-4d04-8304-cf1479accde8","block_type":"box","text":"is defined in the Code as a “qualified tax credit bond” (which includes a qualified forestry conservation bond, a new","page_number":109,"box":{"x":70,"y":763,"width":825,"height":11}},{"id":"66cb99eb-830f-4d16-b6bc-b2bba0dc9e68","block_type":"box","text":"clean renewable energy bond, a qualified energy conservation bond, or a qualified zone academy bond, each of which","page_number":109,"box":{"x":69,"y":778,"width":837,"height":11}},{"id":"c210935b-4175-490f-9e0a-2f46ccd30ea0","block_type":"box","text":"must meet cer tain requirements specified in the Code), a “Build America Bond” (which includes cer tain qualified","page_number":109,"box":{"x":69,"y":793,"width":802,"height":11}},{"id":"759c6bc1-722c-4a0c-9a17-652b9437f84f","block_type":"box","text":"bonds issued before January 1, 2011) or cer tain other specified bonds. If the Fund were to so elect, a shareholder","page_number":109,"box":{"x":69,"y":808,"width":821,"height":11}},{"id":"aa170ef7-6bb2-406e-8409-2cf25ad4e816","block_type":"box","text":"would be required to include in income and would be entitled to claim as a tax credit an amount equal to a","page_number":109,"box":{"x":68,"y":823,"width":760,"height":11}},{"id":"423e338e-25d4-468e-8383-278239b8ca80","block_type":"box","text":"propor tionate share of such credits, and such amount would be subject to withholding provisions of the Code.","page_number":109,"box":{"x":70,"y":838,"width":782,"height":12}},{"id":"47fdcfe0-69db-428a-b682-52cf3cb9d60c","block_type":"box","text":"Cer tain limitations may apply on the extent to which the credit may be claimed.","page_number":109,"box":{"x":69,"y":854,"width":563,"height":11}},{"id":"eb5d7ffe-0194-4c91-9c57-64544461dd8e","block_type":"box","text":"Tax-Exempt Municipal Investments.","page_number":109,"box":{"x":103,"y":876,"width":246,"height":11}},{"id":"aa75f54f-112c-44ec-b3bc-ee7db9445255","block_type":"box","text":"Cer tain Funds may hold tax-exempt municipal investments which may be in","page_number":109,"box":{"x":355,"y":876,"width":534,"height":11}},{"id":"128d99e7-a391-4b20-9824-e4a131f05675","block_type":"box","text":"the form of tender option bonds, variable rate demand obligations, par ticipations, beneficial interests in a trust,","page_number":109,"box":{"x":68,"y":891,"width":798,"height":12}},{"id":"97dcb1cb-6e1d-4b94-87d2-a17bfc6267b2","block_type":"box","text":"par tnership interests or other forms. These investments are described in greater detail above in this section. Some","page_number":109,"box":{"x":70,"y":906,"width":823,"height":12}},{"id":"eff60e37-750d-4af8-a74d-b3394fbf6428","block_type":"box","text":"II-62","page_number":109,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"033b57f6-a30b-4e23-a977-50a8c134eebc","block_type":"box","text":"NM1026U-6033063-109/246","page_number":109,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"8ee856e4-6102-4bc8-ac87-505f90d8c413","block_type":"box","text":"of the structures used by cer tain Funds include interests in long-term fixed-rate municipal debt obligations, held by a","page_number":110,"box":{"x":69,"y":45,"width":830,"height":11}},{"id":"c58db578-7599-476f-9694-de092053f5bb","block_type":"box","text":"trustee or custodian, that are coupled with tender option, demand and other features when the tax-exempt municipal","page_number":110,"box":{"x":68,"y":60,"width":832,"height":11}},{"id":"24fb7e30-5bc3-4f1b-85b5-c651d7e69e6d","block_type":"box","text":"investments are created. Together, these features entitle the holder of the interest to tender (or put) the underlying","page_number":110,"box":{"x":70,"y":75,"width":819,"height":11}},{"id":"888ed648-f04c-4da6-8d7f-2edc37d3dda8","block_type":"box","text":"municipal debt obligation to a third par ty at periodic intervals and to receive the principal amount thereof.","page_number":110,"box":{"x":69,"y":90,"width":752,"height":11}},{"id":"b8a324aa-c01d-4928-8d98-7f5e9e338d08","block_type":"box","text":"In some cases, municipal debt obligations are represented by custodial receipts evidencing rights to receive","page_number":110,"box":{"x":102,"y":113,"width":770,"height":11}},{"id":"1e9e0149-cc14-429c-befa-f9b08decc632","block_type":"box","text":"specific future interest payments, principal payments, or both, on the underlying securities held by the custodian.","page_number":110,"box":{"x":69,"y":128,"width":806,"height":11}},{"id":"c926a49d-3584-4576-9bc9-72cafbcc7d06","block_type":"box","text":"Under such arrangements, the holder of the custodial receipt has the option to tender the underlying securities at","page_number":110,"box":{"x":70,"y":143,"width":809,"height":11}},{"id":"a4a2c87e-71d9-4b1f-a2af-17cd9d883201","block_type":"box","text":"their face value to the sponsor (","page_number":110,"box":{"x":68,"y":158,"width":228,"height":11}},{"id":"4db80b5d-7b91-4386-951d-6f9172204be4","block_type":"box","text":"e.g.","page_number":110,"box":{"x":297,"y":160,"width":25,"height":9}},{"id":"a670405c-354d-4fba-b1db-b45d97a810e7","block_type":"box","text":", a Fund, or a bank or broker-dealer or other financial institution), which is paid","page_number":110,"box":{"x":325,"y":158,"width":557,"height":11}},{"id":"05586855-f6d0-499d-b8e3-afd265f5f106","block_type":"box","text":"periodic fees equal to the difference between the securities’ fixed coupon rate and the rate that would cause the","page_number":110,"box":{"x":70,"y":173,"width":803,"height":11}},{"id":"006149e0-4f88-4eb3-ab8d-d6d126e2d55c","block_type":"box","text":"securities, coupled with the tender option, to trade at par on the date of a rate adjustment.","page_number":110,"box":{"x":69,"y":188,"width":648,"height":11}},{"id":"b473560e-eeff-407a-9465-e09f53646ea3","block_type":"box","text":"A par ticipation interest gives the Fund an undivided interest in a Municipal Bond in the propor tion the Fund’s","page_number":110,"box":{"x":101,"y":211,"width":775,"height":11}},{"id":"f9a9a6ca-a006-482a-9e92-62ae3f46c9ab","block_type":"box","text":"par ticipation bears to the total principal amount of the Municipal Bond, and typically provides for a repurchase","page_number":110,"box":{"x":70,"y":226,"width":785,"height":11}},{"id":"dadd8a7a-8ee2-488a-9c8e-10349ec1f205","block_type":"box","text":"feature for all or any par t of the full principal amount of the par ticipation interest, plus accrued interest. Trusts and","page_number":110,"box":{"x":68,"y":241,"width":821,"height":11}},{"id":"0eecde4a-c1a2-4460-836a-2fb51d538c08","block_type":"box","text":"par tnerships are typically used to conver t long-term fixed rate high quality bonds of a single state or municipal issuer","page_number":110,"box":{"x":70,"y":256,"width":833,"height":12}},{"id":"01f5eaf8-d029-444e-9b46-af1df8e7d4e0","block_type":"box","text":"into variable or floating rate demand instruments.","page_number":110,"box":{"x":70,"y":271,"width":351,"height":12}},{"id":"133e1041-f4b1-49ec-bd10-4836719151a2","block_type":"box","text":"The Municipal Bond Funds may hold par ticipation interests and custodial receipts for municipal debt obligations","page_number":110,"box":{"x":101,"y":294,"width":797,"height":11}},{"id":"4dab67ee-2a72-40ec-bf01-405e0290036c","block_type":"box","text":"which give the holder the right to receive payment of principal subject to the conditions described above. The IRS has","page_number":110,"box":{"x":68,"y":309,"width":836,"height":11}},{"id":"ef875e7f-7983-449f-8298-1378e6493cbc","block_type":"box","text":"not ruled on whether the interest received on tax-exempt municipal investments in the form of par ticipation interests","page_number":110,"box":{"x":69,"y":324,"width":831,"height":11}},{"id":"89c95f14-a6af-48ae-84c3-9086d6f30c9b","block_type":"box","text":"or custodial receipts is tax-exempt, and accordingly, purchases of any such interests or receipts are based on the","page_number":110,"box":{"x":69,"y":339,"width":809,"height":12}},{"id":"0082a600-408c-46a6-8221-21b1ab825116","block_type":"box","text":"opinions of counsel to the sponsors of such derivative securities. Neither a Fund nor its investment adviser or sub","page_number":110,"box":{"x":69,"y":355,"width":818,"height":11}},{"id":"c6590df0-a95b-43a9-b3b2-93aa982204a9","block_type":"box","text":"advisers will review the proceedings related to the creation of any tax-exempt municipal investments or the basis for","page_number":110,"box":{"x":69,"y":370,"width":828,"height":11}},{"id":"2cf2b802-ef15-44fc-a60d-525ad558ffe4","block_type":"box","text":"such opinions.","page_number":110,"box":{"x":69,"y":385,"width":102,"height":11}},{"id":"fc996aca-ae2e-46d5-84ab-7e65c436e230","block_type":"box","text":"Operational and Technology Risks.","page_number":110,"box":{"x":102,"y":408,"width":250,"height":11}},{"id":"aafbcde3-8c32-45b0-9a9b-fecf75fe28e8","block_type":"box","text":"The Fund and the entities with which it interacts directly or indirectly are","page_number":110,"box":{"x":358,"y":408,"width":512,"height":11}},{"id":"f4bf7c4e-d9b4-4799-8332-f30d685c9225","block_type":"box","text":"susceptible to operational and technology risks, including those related to human errors, processing errors,","page_number":110,"box":{"x":69,"y":423,"width":766,"height":11}},{"id":"cb79c97d-871a-485e-83af-e83b963c921b","block_type":"box","text":"communication errors, systems failures, cybersecurity incidents, and the use of ar tificial intelligence and machine","page_number":110,"box":{"x":69,"y":438,"width":812,"height":11}},{"id":"a51bfdd6-6f54-4567-a570-c67d332d8094","block_type":"box","text":"learning (“AI”), which may result in losses for the Fund and its shareholders or impair the Fund’s operations. These","page_number":110,"box":{"x":70,"y":453,"width":820,"height":11}},{"id":"727551ef-6c94-41e1-a3ef-e67165f84cec","block_type":"box","text":"entities include, but are not limited to, the Fund’s adviser, administrator, distributor, other service providers (e.g.,","page_number":110,"box":{"x":69,"y":468,"width":807,"height":11}},{"id":"166dc787-929d-496a-8d87-14b59c142e03","block_type":"box","text":"index and benchmark providers, accountants, custodians, and transfer agents), financial intermediaries,","page_number":110,"box":{"x":70,"y":483,"width":741,"height":11}},{"id":"697faf9b-26eb-40aa-bc12-9c714081fd7f","block_type":"box","text":"counterpar ties, market makers, Authorized Par ticipants, listing exchanges, other financial market operators, and","page_number":110,"box":{"x":69,"y":498,"width":802,"height":11}},{"id":"11d4bd38-d3cc-4836-9407-1409df83bc54","block_type":"box","text":"governmental authorities, as applicable. Operational and technology risks for the issuers in which the Fund invests","page_number":110,"box":{"x":68,"y":513,"width":818,"height":12}},{"id":"ad383840-2046-4dbd-8e67-9297224044b5","block_type":"box","text":"could also result in material adverse consequences for such issuers and may cause the Fund’s investments in such","page_number":110,"box":{"x":69,"y":528,"width":827,"height":12}},{"id":"d9840ab2-3445-4733-8d3c-f5d3323ab9fe","block_type":"box","text":"issuers to lose value. The Fund may incur substantial costs in order to mitigate operational and technology risks.","page_number":110,"box":{"x":70,"y":544,"width":803,"height":11}},{"id":"92f30802-4da4-43c3-9c67-07a05159605b","block_type":"box","text":"Cybersecurity incidents can result from deliberate attacks or unintentional events against an issuer in which the","page_number":110,"box":{"x":102,"y":566,"width":796,"height":11}},{"id":"a645b036-02bb-4c08-bf58-34b6e4ea702a","block_type":"box","text":"Fund invests, the Fund or any of its service providers. They include, but are not limited to, gaining unauthorized","page_number":110,"box":{"x":70,"y":581,"width":790,"height":12}},{"id":"deb3f4f7-e8b6-41b2-8dc9-62cba94afb07","block_type":"box","text":"access to systems, misappropriating assets or sensitive information, corrupting or destroying data, and causing","page_number":110,"box":{"x":69,"y":596,"width":800,"height":12}},{"id":"b268a018-1d1a-442b-b9a9-ac1477a3994a","block_type":"box","text":"operational disruption. Geopolitical tension may increase the scale and sophistication of deliberate attacks,","page_number":110,"box":{"x":69,"y":612,"width":768,"height":11}},{"id":"d2573db7-3850-4585-bd31-059b17fb6be2","block_type":"box","text":"par ticularly those from nation states or from entities with nation state backing. Cybersecurity incidents may result in","page_number":110,"box":{"x":70,"y":627,"width":827,"height":11}},{"id":"f9935f18-6a17-40c2-a4e2-4f24b4f0248d","block_type":"box","text":"any of the following: financial losses; inter ference with the Fund’s ability to calculate its NAV; disclosure of","page_number":110,"box":{"x":69,"y":642,"width":760,"height":11}},{"id":"ad00c19a-204b-4ed9-96f5-fc0f30091813","block_type":"box","text":"confidential information; impediments to trading; submission of erroneous trades by the Fund or erroneous","page_number":110,"box":{"x":69,"y":657,"width":763,"height":11}},{"id":"4d83d908-edf0-4b7e-b815-2fb82e7d4982","block_type":"box","text":"subscription or redemption orders; the inability of the Fund or its service providers to transact business; violations of","page_number":110,"box":{"x":69,"y":672,"width":835,"height":11}},{"id":"096f7a8c-d048-41c3-bae8-6560a56a1f52","block_type":"box","text":"applicable privacy and other laws; regulatory fines; penalties; reputational damage; reimbursement or other","page_number":110,"box":{"x":69,"y":687,"width":766,"height":11}},{"id":"65cd5c30-bedc-4601-a0a1-fbec8e4cc533","block_type":"box","text":"compensation costs; and other legal and compliance expenses. Fur thermore, cybersecurity incidents may render","page_number":110,"box":{"x":69,"y":703,"width":804,"height":11}},{"id":"5a4001d5-88ed-4d56-b746-99d5596c13b5","block_type":"box","text":"records of the Fund, including records relating to its assets and transactions, shareholder ownership of Fund shares,","page_number":110,"box":{"x":69,"y":717,"width":833,"height":12}},{"id":"3ae628a1-4d22-407e-b2aa-8d509897a9f6","block_type":"box","text":"and other data integral to the Fund’s functioning, inaccessible, inaccurate or incomplete. Power outages, natural","page_number":110,"box":{"x":69,"y":732,"width":800,"height":12}},{"id":"a83f912c-e0af-4348-9fd8-fc74f2e69e99","block_type":"box","text":"disasters, equipment malfunctions and processing errors that threaten information and technology systems relied","page_number":110,"box":{"x":69,"y":748,"width":812,"height":11}},{"id":"6a3b2102-f359-4b57-839d-962ff82228d5","block_type":"box","text":"upon by the Fund or its service providers, as well as market events that occur at a pace that overloads these","page_number":110,"box":{"x":69,"y":763,"width":777,"height":11}},{"id":"127bbc1b-4346-4e8a-9307-6a615b2df08d","block_type":"box","text":"systems, may also disrupt business operations or impact critical data. Recent advances in AI technology pose risks","page_number":110,"box":{"x":69,"y":778,"width":824,"height":11}},{"id":"acc64745-d484-414e-adb8-a1fefb41a1c3","block_type":"box","text":"to the Fund and its por tfolio investments. These advancements could harm the Fund and its por tfolio investments by","page_number":110,"box":{"x":68,"y":793,"width":836,"height":11}},{"id":"54d418ed-e788-49d0-b123-093c6d80c664","block_type":"box","text":"reducing the demand for both the technology and software offerings of the Fund’s por tfolio investments. Additionally,","page_number":110,"box":{"x":69,"y":808,"width":833,"height":11}},{"id":"fea6dd2b-f25c-45bf-8160-3cc8a20d981e","block_type":"box","text":"these advancements could significantly disrupt the Fund’s por tfolio investments and subject them to increased","page_number":110,"box":{"x":68,"y":823,"width":793,"height":12}},{"id":"34f15558-674d-403b-9cf1-b169084db17a","block_type":"box","text":"competition, which could have a material adverse effect on business, financial condition, and results of operations.","page_number":110,"box":{"x":69,"y":838,"width":822,"height":11}},{"id":"8c1ad58b-7f46-4167-a820-13d7220b2ccf","block_type":"box","text":"AI technology advancements, including efficiency improvements, without related increases in the adoption and","page_number":110,"box":{"x":68,"y":853,"width":787,"height":12}},{"id":"93fe24f7-6716-456a-b48a-b1af84c1f774","block_type":"box","text":"development of such technologies, could also negatively impact demand for, and the valuation of, digital","page_number":110,"box":{"x":69,"y":869,"width":742,"height":11}},{"id":"a4540447-e066-46a0-93ce-90a7a8cf01d2","block_type":"box","text":"infrastructure assets.","page_number":110,"box":{"x":70,"y":884,"width":151,"height":9}},{"id":"b3a442a5-c292-4b0e-8cf3-ab8136ca2ac8","block_type":"box","text":"II-63","page_number":110,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"22630286-cb71-4cf9-acbe-b58cdccf2fb0","block_type":"box","text":"NM1026U-6033063-110/246","page_number":110,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"d2d6b2f4-9047-4dd7-acfd-115214882fce","block_type":"box","text":"The Fund and its por tfolio investments could be exposed to the risks of AI technology if third-par ty service","page_number":111,"box":{"x":101,"y":45,"width":755,"height":11}},{"id":"02f0b593-5faf-487b-a181-37dfc7e2a728","block_type":"box","text":"providers or any counterpar ties, whether or not known to the Fund, also use AI technology in their business activities.","page_number":111,"box":{"x":70,"y":60,"width":835,"height":11}},{"id":"89a04f43-e4af-420d-9948-5b8437d06c58","block_type":"box","text":"The Fund and its service providers may not be in a position to control the use of AI technology in third-par ty products","page_number":111,"box":{"x":68,"y":75,"width":833,"height":11}},{"id":"50369285-203b-494d-99a5-e67174ba16c8","block_type":"box","text":"or services.","page_number":111,"box":{"x":69,"y":90,"width":82,"height":9}},{"id":"769521ff-742b-4ba4-b9a4-42c878ecd425","block_type":"box","text":"Use of AI technology could include the input of confidential information in contravention of applicable policies,","page_number":111,"box":{"x":102,"y":113,"width":781,"height":11}},{"id":"319ba46e-5ac0-4a0a-8ad7-20be4e7b5d1b","block_type":"box","text":"contractual or other obligations or restrictions, resulting in such confidential information becoming accessible by","page_number":111,"box":{"x":69,"y":128,"width":801,"height":11}},{"id":"90584c1b-2401-4b6e-9c0c-3b2db7fec712","block_type":"box","text":"other third-par ty AI technology applications and users.","page_number":111,"box":{"x":69,"y":143,"width":383,"height":11}},{"id":"91d0d06a-0bd0-4296-a9fb-7afb750db4a9","block_type":"box","text":"Independent of its context of use, AI technology is generally highly reliant on the collection and analysis of large","page_number":111,"box":{"x":102,"y":166,"width":795,"height":11}},{"id":"d665ccdb-5165-41a5-889d-eb560db7bde2","block_type":"box","text":"amounts of data, may incorporate biased or inaccurate data, and it is not possible or practicable to incorporate all","page_number":111,"box":{"x":69,"y":181,"width":813,"height":11}},{"id":"46ac3d88-74f0-49f2-bc78-a979a536944c","block_type":"box","text":"relevant data into the models that AI technology utilizes to operate. Cer tain data in such models will inevitably","page_number":111,"box":{"x":69,"y":196,"width":785,"height":11}},{"id":"84169b16-d742-4e10-8943-608c264515e5","block_type":"box","text":"contain a degree of inaccuracy and error, or could otherwise be inadequate or flawed, which would be likely to","page_number":111,"box":{"x":69,"y":211,"width":782,"height":11}},{"id":"69e952b9-e111-443c-9add-aa4a19c6ee4c","block_type":"box","text":"degrade the effectiveness of AI technology. The output or results of any such AI technologies may therefore be","page_number":111,"box":{"x":69,"y":226,"width":787,"height":11}},{"id":"0a6a2fd3-6a52-4603-8b38-d4978e59006e","block_type":"box","text":"incomplete, erroneous, distor ted, or misleading. Fur ther, AI tools may lack transparency as to how data is utilized","page_number":111,"box":{"x":70,"y":241,"width":809,"height":11}},{"id":"7a6098c6-059b-486f-8b49-3f21d914e731","block_type":"box","text":"and how outputs are generated. AI technologies may also allow the unintended introduction of vulnerabilities into","page_number":111,"box":{"x":69,"y":256,"width":805,"height":12}},{"id":"d7be071e-7372-4145-9e64-3a438e6ca447","block_type":"box","text":"infrastructures and applications. To the extent that the Fund or its por tfolio investments are exposed to the risks of","page_number":111,"box":{"x":70,"y":271,"width":822,"height":11}},{"id":"881538ea-7b03-48f9-9c8b-d428ae378b49","block_type":"box","text":"AI technology use, any such inaccuracies or errors could have adverse impacts on the Fund or its investments.","page_number":111,"box":{"x":68,"y":287,"width":789,"height":11}},{"id":"8623ae81-dad8-4fa1-b680-461a925ef26c","block_type":"box","text":"Regulations related to AI technology could also impose cer tain obligations and costs related to monitoring and","page_number":111,"box":{"x":102,"y":309,"width":786,"height":11}},{"id":"6079ab24-7b6f-4cd6-9f56-7424898952f9","block_type":"box","text":"compliance. For example, in April 2023, the Federal Trade Commission, U.S. Depar tment of Justice, Consumer","page_number":111,"box":{"x":69,"y":324,"width":791,"height":11}},{"id":"b425db5a-2cb2-466a-a27c-bd47fff23596","block_type":"box","text":"Financial Protection Bureau, and U.S. Equal Employment Oppor tunity Commission released a joint statement on","page_number":111,"box":{"x":70,"y":340,"width":796,"height":11}},{"id":"93ca226c-dcbb-46ba-88db-c90b31fcfa2d","block_type":"box","text":"ar tificial intelligence demonstrating interest in monitoring the development and use of automated systems and","page_number":111,"box":{"x":69,"y":355,"width":788,"height":11}},{"id":"a905c49d-b63a-4a64-bee2-2c6ff8ac563a","block_type":"box","text":"enforcement of their respective laws and regulations. In October 2023, an executive order established new standards","page_number":111,"box":{"x":69,"y":370,"width":839,"height":11}},{"id":"06707d10-8871-4017-bb1a-ad352292d119","block_type":"box","text":"for AI safety and security. In addition to the U.S. regulatory framework, in 2024, the EU adopted the Ar tificial","page_number":111,"box":{"x":68,"y":385,"width":773,"height":11}},{"id":"427ff6ab-ea0e-48f0-a293-577c6b177c42","block_type":"box","text":"Intelligence Act, which applies to cer tain AI technology and the data used to train, test, and deploy them, which may","page_number":111,"box":{"x":70,"y":400,"width":826,"height":11}},{"id":"8f7899fc-85e6-423e-af3d-e9bfd4d9c12f","block_type":"box","text":"create additional compliance burdens, higher administrative costs, and significant penalties should the Fund, the","page_number":111,"box":{"x":69,"y":415,"width":805,"height":11}},{"id":"66893293-0ffa-485a-ba50-23e75d254b15","block_type":"box","text":"adviser, or the Fund’s por tfolio investments fail to comply.","page_number":111,"box":{"x":69,"y":430,"width":412,"height":11}},{"id":"a6bfdb82-3256-4bc6-9023-48bc24612383","block_type":"box","text":"AI technology and its applications, including in the investment and financial sectors, continue to develop rapidly,","page_number":111,"box":{"x":101,"y":453,"width":797,"height":11}},{"id":"3f426664-8cdf-4bde-8542-198c570f2149","block_type":"box","text":"and it is impossible to predict the future risks that may arise from such developments. The full extent of current or","page_number":111,"box":{"x":69,"y":468,"width":817,"height":11}},{"id":"bf46b27a-377e-41e3-9307-081fb9ac895c","block_type":"box","text":"future risks related thereto is not possible to predict, and the Fund may not be able to anticipate, prevent, mitigate,","page_number":111,"box":{"x":68,"y":483,"width":824,"height":11}},{"id":"9103a66e-8d6c-438b-9c0a-31bb54d1253f","block_type":"box","text":"or remediate all of the potential risks, challenges, or impacts of such changes.","page_number":111,"box":{"x":69,"y":498,"width":561,"height":11}},{"id":"4aad685c-a9ab-4765-8716-f0879553c6af","block_type":"box","text":"While the Fund’s service providers are required to have appropriate operational, information security and","page_number":111,"box":{"x":101,"y":521,"width":747,"height":11}},{"id":"9992df9c-1982-466d-bf9d-0a8e14166cd6","block_type":"box","text":"cybersecurity risk management policies and procedures, their methods of risk management may differ from those of","page_number":111,"box":{"x":69,"y":536,"width":830,"height":11}},{"id":"949af70f-944f-4ce4-87d7-1282963bcb30","block_type":"box","text":"the Fund in the setting of priorities, the personnel and resources available or the effectiveness of relevant controls.","page_number":111,"box":{"x":68,"y":551,"width":823,"height":11}},{"id":"a30d67d3-36df-474d-8066-8ad6ed0c1d51","block_type":"box","text":"The Fund and its adviser seek to reduce these risks through controls, procedures and oversight, including","page_number":111,"box":{"x":68,"y":566,"width":755,"height":11}},{"id":"d3e94ac1-d945-43a6-b329-8c3bb154ee49","block_type":"box","text":"establishing business continuity plans and risk management systems. However, there are inherent limitations in such","page_number":111,"box":{"x":69,"y":582,"width":838,"height":11}},{"id":"a6c400c0-7ac0-4375-b727-129297a47617","block_type":"box","text":"plans and systems, including the possibility that cer tain risks that may affect the Fund have not been identified or","page_number":111,"box":{"x":70,"y":596,"width":812,"height":12}},{"id":"eccfee74-a110-4871-8aee-981c0312ca31","block_type":"box","text":"may emerge in the future; that such plans and systems may not completely eliminate the occurrence or mitigate the","page_number":111,"box":{"x":69,"y":612,"width":828,"height":11}},{"id":"a6bf9494-229b-4965-adc2-58a6f04e365c","block_type":"box","text":"effects of operational or information security disruptions or failures or of cybersecurity incidents; or that prevention","page_number":111,"box":{"x":69,"y":627,"width":819,"height":11}},{"id":"3692d2ef-c32b-4b90-9ecf-6ec48df79bf8","block_type":"box","text":"and remediation effor ts will not be successful or that incidents will go undetected. The Fund cannot control the","page_number":111,"box":{"x":69,"y":642,"width":792,"height":11}},{"id":"26368a17-23fd-463e-bdb0-506f54302ddb","block_type":"box","text":"systems, information security or other cybersecurity of the issuers in which it invests or its service providers,","page_number":111,"box":{"x":69,"y":657,"width":775,"height":11}},{"id":"ab9b9ac1-7985-45bf-b243-5ad8263185f8","block_type":"box","text":"counterpar ties, and other third par ties whose activities affect the Fund.","page_number":111,"box":{"x":69,"y":672,"width":510,"height":11}},{"id":"c09d253a-c397-4389-a6b0-f5d5a407dc3a","block_type":"box","text":"Lastly, the regulatory climate governing cybersecurity and data protection is developing quickly and may vary","page_number":111,"box":{"x":102,"y":695,"width":771,"height":11}},{"id":"83968b2e-48e4-4925-a8c8-98587ec1df3c","block_type":"box","text":"considerably across jurisdictions. Regulators continue to develop new rules and standards related to cybersecurity","page_number":111,"box":{"x":69,"y":710,"width":816,"height":11}},{"id":"74725dc0-0e7a-42a7-91fe-4cb655775cb3","block_type":"box","text":"and data protection. Compliance with evolving regulations can be demanding and costly, requiring substantial","page_number":111,"box":{"x":69,"y":725,"width":778,"height":11}},{"id":"c8fbead1-964e-45d8-aac7-32f7a5cbc4a0","block_type":"box","text":"resources to monitor and implement required changes.","page_number":111,"box":{"x":69,"y":740,"width":391,"height":11}},{"id":"9ee1a656-a860-4219-a559-2002a9ba2389","block_type":"box","text":"Participation Notes.","page_number":111,"box":{"x":102,"y":763,"width":145,"height":11}},{"id":"46aa6930-21c3-422b-be7d-7be4dd1b2f3f","block_type":"box","text":"A Fund may buy par ticipation notes from a bank or broker-dealer (“issuer”) that entitle the","page_number":111,"box":{"x":253,"y":763,"width":641,"height":11}},{"id":"7a6ec93c-d8d9-44f0-9cdd-7d7f05595ac1","block_type":"box","text":"Fund to a return measured by the change in value of an identified underlying security or basket of securities","page_number":111,"box":{"x":70,"y":778,"width":766,"height":11}},{"id":"f59d3c15-b42d-4deb-b289-cc0672bab3f6","block_type":"box","text":"(collectively, the “underlying security”). Par ticipation notes are typically used when a direct investment in the","page_number":111,"box":{"x":69,"y":793,"width":772,"height":11}},{"id":"99129430-aba2-40f3-b9c5-84abce1988cc","block_type":"box","text":"underlying security is restricted due to country-specific regulations.","page_number":111,"box":{"x":69,"y":808,"width":475,"height":11}},{"id":"6dda9e37-cf4e-450b-a4e7-dbb497408816","block_type":"box","text":"The Fund is subject to counterpar ty risk associated with each issuer. Investment in a par ticipation note is not","page_number":111,"box":{"x":101,"y":831,"width":782,"height":11}},{"id":"1dd4fdfb-1d13-4b3e-b922-1ccd21fe229a","block_type":"box","text":"the same as investment in the constituent shares of the company. A par ticipation note represents only an obligation","page_number":111,"box":{"x":68,"y":846,"width":831,"height":11}},{"id":"c1648c67-8021-42f1-b97e-381d9fd4e9e0","block_type":"box","text":"of the issuer to provide the Fund the economic per formance equivalent to holding shares of an underlying security. A","page_number":111,"box":{"x":69,"y":861,"width":831,"height":11}},{"id":"51fdcedb-4b93-4ada-9110-2080b741e858","block_type":"box","text":"par ticipation note does not provide any beneficial or equitable entitlement or interest in the relevant underlying","page_number":111,"box":{"x":70,"y":876,"width":789,"height":11}},{"id":"02dbf974-ac2e-4b5c-a916-26685e8eaa1d","block_type":"box","text":"security. In other words, shares of the underlying security are not in any way owned by the Fund. However, each","page_number":111,"box":{"x":69,"y":891,"width":791,"height":12}},{"id":"e1a4ece2-ccd8-4410-9c4c-b7b7750cc966","block_type":"box","text":"par ticipation note synthetically replicates the economic benefit of holding shares in the underlying security. Because","page_number":111,"box":{"x":70,"y":906,"width":827,"height":12}},{"id":"b4f41022-0941-4790-8fe3-0cc416f58663","block_type":"box","text":"II-64","page_number":111,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"fd2cd579-a493-4e4d-80b4-1d01edcc0746","block_type":"box","text":"NM1026U-6033063-111/246","page_number":111,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"8a679215-50b1-4183-a828-480466c52fd9","block_type":"box","text":"a par ticipation note is an obligation of the issuer, rather than a direct investment in shares of the underlying security,","page_number":112,"box":{"x":69,"y":45,"width":834,"height":11}},{"id":"5656a464-3698-47c7-b9ea-6a6bb884113d","block_type":"box","text":"a Fund may suffer losses potentially equal to the full value of the par ticipation note if the issuer fails to per form its","page_number":112,"box":{"x":69,"y":60,"width":822,"height":11}},{"id":"81e0d3c9-cb8b-4a2d-97a7-910f69e11a1a","block_type":"box","text":"obligations. A Fund attempts to mitigate that risk by purchasing only from issuers determined to be creditwor thy.","page_number":112,"box":{"x":69,"y":75,"width":801,"height":11}},{"id":"7e51f782-3116-4a67-ae6b-dafff61d0e2c","block_type":"box","text":"The counterpar ty may, but is not required to, purchase the shares of the underlying security to hedge its","page_number":112,"box":{"x":101,"y":98,"width":743,"height":11}},{"id":"b248d1b6-ebd1-4384-ae9d-b3971ac73f3f","block_type":"box","text":"obligation. A Fund may, but is not required to, purchase credit protection against the default of the issuer. When the","page_number":112,"box":{"x":69,"y":113,"width":826,"height":11}},{"id":"2c3e0b14-b6ee-4181-a59d-de50af2f6317","block_type":"box","text":"par ticipation note expires or a Fund exercises the par ticipation note and closes its position, the Fund receives a","page_number":112,"box":{"x":70,"y":128,"width":799,"height":11}},{"id":"5859ef2a-973e-4807-bef5-095a3d655086","block_type":"box","text":"payment that is based upon the then-current value of the underlying security conver ted into U.S. dollars (less","page_number":112,"box":{"x":70,"y":143,"width":776,"height":11}},{"id":"1a974b11-b872-440a-8541-405a4d7f01f4","block_type":"box","text":"transaction costs). The price, per formance and liquidity of a par ticipation note are all linked directly to the underlying","page_number":112,"box":{"x":68,"y":158,"width":834,"height":11}},{"id":"7c439e44-be10-4d02-a9f5-1b7fc5a36f15","block_type":"box","text":"security. A Fund’s ability to redeem or exercise a par ticipation note generally is dependent on the liquidity in the local","page_number":112,"box":{"x":69,"y":173,"width":834,"height":11}},{"id":"0f66a6ed-7a1c-4fa1-9ee9-e21caf6ba802","block_type":"box","text":"trading market for the security underlying the par ticipation note.","page_number":112,"box":{"x":68,"y":188,"width":454,"height":12}},{"id":"53bc083e-8438-4383-a18e-484868c79003","block_type":"box","text":"Portfolio Turnover Rates.","page_number":112,"box":{"x":102,"y":211,"width":181,"height":9}},{"id":"05609b32-0d39-464c-9538-45482d7336fb","block_type":"box","text":"A Fund’s annual por tfolio turnover rate will not be a factor preventing a sale or","page_number":112,"box":{"x":289,"y":211,"width":558,"height":11}},{"id":"5cbe9951-6b95-4347-b9f7-584936b1fbee","block_type":"box","text":"purchase when the Manager believes investment considerations warrant such sale or purchase. Although cer tain","page_number":112,"box":{"x":70,"y":226,"width":804,"height":11}},{"id":"b464dc0f-88f8-47be-a943-d537db728c3a","block_type":"box","text":"Funds will use an approach to investing that is largely a passive, indexing approach, such Funds may engage in a","page_number":112,"box":{"x":70,"y":241,"width":806,"height":11}},{"id":"301a3c9d-5264-4cdf-a2f0-8358e236372c","block_type":"box","text":"substantial number of por tfolio transactions. With respect to these Funds, the rate of por tfolio turnover will be a","page_number":112,"box":{"x":69,"y":256,"width":800,"height":11}},{"id":"a9d5858a-01b4-4224-9457-8d2dfcdff368","block_type":"box","text":"limiting factor when the Manager considers whether to purchase or sell securities for a Fund only to the extent that","page_number":112,"box":{"x":70,"y":271,"width":818,"height":12}},{"id":"c409fe46-3b6f-490f-b869-8d4178d8d711","block_type":"box","text":"the Manager will consider the impact of transaction costs on a Fund’s tracking error. Por tfolio turnover may vary","page_number":112,"box":{"x":68,"y":286,"width":800,"height":12}},{"id":"1c389135-a87e-4f64-bdfb-13f8b0a23528","block_type":"box","text":"greatly from year to year as well as within a par ticular year. High por tfolio turnover (","page_number":112,"box":{"x":68,"y":302,"width":595,"height":11}},{"id":"690db6ad-c9de-41fe-8eeb-b8c753991ffa","block_type":"box","text":"i.e.","page_number":112,"box":{"x":665,"y":302,"width":20,"height":9}},{"id":"108d0134-e0ba-4f88-b2f6-719a3a70d161","block_type":"box","text":", 100% or more) may result in","page_number":112,"box":{"x":687,"y":302,"width":210,"height":11}},{"id":"4f16e647-dca4-4392-9bc1-14418542398d","block_type":"box","text":"increased transaction costs to a Fund, including brokerage commissions, dealer mark-ups and other transaction","page_number":112,"box":{"x":70,"y":317,"width":797,"height":11}},{"id":"60463891-1aef-4d04-9b09-7a5df8318685","block_type":"box","text":"costs on the sale of the securities and reinvestment in other securities. The sale of a Fund’s securities may result in","page_number":112,"box":{"x":69,"y":332,"width":832,"height":11}},{"id":"71bb9743-ebce-4924-9ecd-c7ee5907bb65","block_type":"box","text":"the recognition of capital gain or loss. Given the frequency of sales, such gain or loss will likely be shor t-term capital","page_number":112,"box":{"x":68,"y":347,"width":831,"height":11}},{"id":"8c4a2dab-88d1-4d24-83b7-fe2fe4ac4684","block_type":"box","text":"gain or loss. These effects of higher than normal por tfolio turnover may adversely affect a Fund’s per formance.","page_number":112,"box":{"x":68,"y":362,"width":795,"height":11}},{"id":"b8780455-de46-4e0b-945a-f3595dc894a5","block_type":"box","text":"Preferred Stock.","page_number":112,"box":{"x":102,"y":385,"width":118,"height":9}},{"id":"2fcae741-2505-44f5-8c2b-e685bca4ee7f","block_type":"box","text":"Cer tain Funds may invest in preferred stocks. Preferred stock has a preference over common","page_number":112,"box":{"x":226,"y":385,"width":665,"height":11}},{"id":"1e2e6170-1530-4c56-8324-2daeca4b0f0e","block_type":"box","text":"stock in liquidation (and generally dividends as well) but is subordinated to bond holders and other creditors in all","page_number":112,"box":{"x":69,"y":400,"width":808,"height":11}},{"id":"0d5fb49a-6b46-4211-bda7-ef6192bb0724","block_type":"box","text":"respects. As a general rule, the market value of preferred stock with a fixed dividend rate and no conversion element","page_number":112,"box":{"x":69,"y":415,"width":834,"height":11}},{"id":"b7960997-66ff-4162-b16e-5dbc2275b283","block_type":"box","text":"varies inversely with interest rates and perceived credit risk, while the market price of conver tible preferred stock","page_number":112,"box":{"x":68,"y":430,"width":808,"height":11}},{"id":"a9b5f351-647e-4827-ad49-5458499dde21","block_type":"box","text":"generally also reflects some element of conversion value. Because preferred stock is junior to debt securities and","page_number":112,"box":{"x":68,"y":445,"width":813,"height":12}},{"id":"370fe428-972a-4d30-84e5-556463671717","block_type":"box","text":"other obligations of the issuer, deterioration in the credit quality of the issuer will cause greater changes in the value","page_number":112,"box":{"x":69,"y":460,"width":831,"height":12}},{"id":"6c7ea71c-c117-41b6-a2de-aa864a3dbecc","block_type":"box","text":"of a preferred stock than in a more senior debt security with similar stated yield characteristics. Unlike interest","page_number":112,"box":{"x":69,"y":475,"width":791,"height":12}},{"id":"15f51212-8b43-4180-9394-689f2fb6cb28","block_type":"box","text":"payments on debt securities, preferred stock dividends are payable only if declared by the issuer’s board of directors.","page_number":112,"box":{"x":70,"y":491,"width":838,"height":11}},{"id":"ed645964-ac00-4ceb-8e07-e921e30b9767","block_type":"box","text":"Preferred stock also may be subject to optional or mandatory redemption provisions.","page_number":112,"box":{"x":69,"y":506,"width":604,"height":11}},{"id":"6164649f-4792-4d78-995e-cd90037b8dad","block_type":"box","text":"Tax-Exempt Preferred Shares.","page_number":112,"box":{"x":103,"y":528,"width":207,"height":11}},{"id":"b0917186-c067-44cc-a362-2f96de6bb665","block_type":"box","text":"Cer tain Funds may invest in preferred interests of other investment funds that pay","page_number":112,"box":{"x":316,"y":528,"width":588,"height":12}},{"id":"14f32f3c-47dc-4f8b-a143-1c7aa31a6210","block_type":"box","text":"dividends that are exempt from regular U.S. federal income tax. Such funds in turn invest in municipal bonds and","page_number":112,"box":{"x":69,"y":543,"width":806,"height":12}},{"id":"7e32eaaf-351f-4428-adb8-762b9d8dfcd8","block_type":"box","text":"other assets that pay interest or make distributions that are exempt from regular U.S. federal income tax, such as","page_number":112,"box":{"x":69,"y":559,"width":814,"height":11}},{"id":"df4e366b-a2bf-4d65-9f8f-607e5ae3ceee","block_type":"box","text":"revenue bonds issued by state or local agencies to fund the development of low-income, multi-family housing.","page_number":112,"box":{"x":69,"y":574,"width":780,"height":11}},{"id":"f63440b9-6dc0-47d0-b2ff-242230d39da9","block_type":"box","text":"Investment in such tax-exempt preferred shares involves many of the same issues as investing in other investment","page_number":112,"box":{"x":70,"y":589,"width":820,"height":11}},{"id":"6d2d2d81-97e0-46d2-897f-e8131d966a46","block_type":"box","text":"companies. These investments also have additional risks, including illiquid investments risk, the absence of","page_number":112,"box":{"x":69,"y":604,"width":772,"height":11}},{"id":"d9f8d8ab-54f5-4442-9496-45e87639b2cb","block_type":"box","text":"regulation governing investment practices, capital structure and leverage, affiliated transactions and other matters,","page_number":112,"box":{"x":69,"y":619,"width":821,"height":11}},{"id":"ef499ea2-cb4e-4bf0-a908-0f4b33822590","block_type":"box","text":"and concentration of investments in par ticular issuers or industries. The Municipal Bond Funds will treat investments","page_number":112,"box":{"x":69,"y":634,"width":834,"height":11}},{"id":"e6a306ec-0d6a-4d7f-a6a1-af857b784361","block_type":"box","text":"in tax-exempt preferred shares as investments in municipal bonds.","page_number":112,"box":{"x":70,"y":649,"width":474,"height":11}},{"id":"bef9ca58-3ae7-4a2d-80de-3a952d277a41","block_type":"box","text":"Trust Preferred Securities.","page_number":112,"box":{"x":103,"y":672,"width":184,"height":9}},{"id":"418d540d-878a-458c-8fbd-ed27657d1268","block_type":"box","text":"Cer tain Funds may invest in trust preferred securities. Trust preferred securities are","page_number":112,"box":{"x":294,"y":672,"width":599,"height":11}},{"id":"3960a3b0-a200-489c-a680-dda99ec8b02f","block_type":"box","text":"typically issued by corporations, generally in the form of interest bearing notes with preferred securities","page_number":112,"box":{"x":68,"y":687,"width":737,"height":11}},{"id":"8a8787bb-d373-473f-b7ee-c557c2009c83","block_type":"box","text":"characteristics, or by an affiliated business trust of a corporation, generally in the form of beneficial interests in","page_number":112,"box":{"x":69,"y":702,"width":796,"height":12}},{"id":"8a2989af-0285-429e-9184-2829033730e9","block_type":"box","text":"subordinated debentures or similarly structured securities. The trust preferred securities market consists of both","page_number":112,"box":{"x":69,"y":717,"width":805,"height":12}},{"id":"f6e658ff-e94a-4b79-aa7c-3e6afe32056d","block_type":"box","text":"fixed and adjustable coupon rate securities that are either perpetual in nature or have stated maturity dates.","page_number":112,"box":{"x":68,"y":732,"width":773,"height":12}},{"id":"d2e95a72-4e53-4e1a-8fbe-92fa3799fff8","block_type":"box","text":"Trust preferred securities are typically junior and fully subordinated liabilities of an issuer and benefit from a","page_number":112,"box":{"x":101,"y":755,"width":770,"height":11}},{"id":"00b8ca6f-b954-4717-b073-d440e05eb5ea","block_type":"box","text":"guarantee that is junior and fully subordinated to the other liabilities of the guarantor. In addition, trust preferred","page_number":112,"box":{"x":68,"y":770,"width":801,"height":12}},{"id":"3db8aa64-d91d-4649-b1b6-58832dc730a8","block_type":"box","text":"securities typically permit an issuer to defer the payment of income for five years or more without triggering an event","page_number":112,"box":{"x":69,"y":785,"width":830,"height":12}},{"id":"74a7b7e5-5691-497a-b670-9fcbae86afac","block_type":"box","text":"of default. Because of their subordinated position in the capital structure of an issuer, the ability to defer payments","page_number":112,"box":{"x":69,"y":801,"width":822,"height":11}},{"id":"6821ea43-c620-4987-982e-e966a38199cf","block_type":"box","text":"for extended periods of time without default consequences to the issuer, and cer tain other features (such as","page_number":112,"box":{"x":68,"y":816,"width":777,"height":11}},{"id":"c26592aa-a31b-4ebf-981c-263e21af9845","block_type":"box","text":"restrictions on common dividend payments by the issuer or ultimate guarantor when full cumulative payments on the","page_number":112,"box":{"x":69,"y":831,"width":831,"height":11}},{"id":"7b833e78-bf73-4f79-ad1e-877b7a699621","block_type":"box","text":"trust preferred securities have not been made), these trust preferred securities are often treated as close","page_number":112,"box":{"x":68,"y":846,"width":757,"height":11}},{"id":"23fc7ee9-c8eb-4725-a596-b4624e15a4ba","block_type":"box","text":"substitutes for traditional preferred securities, both by issuers and investors.","page_number":112,"box":{"x":69,"y":861,"width":548,"height":11}},{"id":"49b1bc5f-0166-4277-9834-40d4c914890c","block_type":"box","text":"Trust preferred securities include but are not limited to trust originated preferred securities (“TOPRS","page_number":112,"box":{"x":101,"y":884,"width":715,"height":11}},{"id":"2c1570d0-c6cc-4737-b589-957781e552cd","block_type":"box","text":"®","page_number":112,"box":{"x":817,"y":884,"width":5,"height":5}},{"id":"65874464-73f1-40c0-aec6-1eed7276125b","block_type":"box","text":"”); monthly","page_number":112,"box":{"x":824,"y":884,"width":77,"height":11}},{"id":"5e2bb325-e84a-4bdc-bd60-d043aaad7ad5","block_type":"box","text":"income preferred securities (“MIPS","page_number":112,"box":{"x":70,"y":899,"width":248,"height":11}},{"id":"9461ad17-0c34-4eb5-a129-949cc38fa089","block_type":"box","text":"®","page_number":112,"box":{"x":319,"y":899,"width":6,"height":5}},{"id":"51d1f24c-9853-409f-af3d-82e80adc1a7c","block_type":"box","text":"”); quar terly income bond securities (“QUIBS","page_number":112,"box":{"x":326,"y":899,"width":317,"height":11}},{"id":"da21adec-8683-4c67-b3e5-c4e13fb79227","block_type":"box","text":"®","page_number":112,"box":{"x":644,"y":899,"width":6,"height":5}},{"id":"9d3cd1ef-8ed6-4406-999c-8b8da68f4e10","block_type":"box","text":"” ); quar terly income debt securities","page_number":112,"box":{"x":652,"y":899,"width":255,"height":11}},{"id":"fb2eef5a-52de-4675-89f6-0173ca5a76b5","block_type":"box","text":"II-65","page_number":112,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"8512e52b-d181-41d4-aed4-0dc60c2f2df5","block_type":"box","text":"NM1026U-6033063-112/246","page_number":112,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"baa4c3a4-68a3-4d21-b562-91cc0b477efa","block_type":"box","text":"(“QUIDS","page_number":113,"box":{"x":69,"y":45,"width":57,"height":11}},{"id":"ea2a81e5-c599-4cea-b29f-f9dcc39229ec","block_type":"box","text":"®","page_number":113,"box":{"x":127,"y":45,"width":6,"height":4}},{"id":"3e7e0af6-e593-4d7d-8931-c299037ccf67","block_type":"box","text":"”); quar terly income preferred securities (“QUIPS","page_number":113,"box":{"x":135,"y":45,"width":346,"height":11}},{"id":"079a0a8c-ee85-4b23-ae49-e7affa2f8db5","block_type":"box","text":"SM","page_number":113,"box":{"x":482,"y":45,"width":11,"height":4}},{"id":"3198462e-c4fb-4a8f-97cd-665dc8f81fe3","block_type":"box","text":"”); corporate trust securities (“CORTS","page_number":113,"box":{"x":495,"y":45,"width":267,"height":11}},{"id":"f4d8594b-22fa-4143-8fe0-6957dccc94b0","block_type":"box","text":"®","page_number":113,"box":{"x":762,"y":45,"width":6,"height":4}},{"id":"bb76a425-3a9f-47e8-b692-9b214fb20312","block_type":"box","text":"”); public income","page_number":113,"box":{"x":770,"y":45,"width":118,"height":11}},{"id":"fd4f88a4-b27c-4358-bedb-7d5021f4ed9e","block_type":"box","text":"notes (“PINES","page_number":113,"box":{"x":69,"y":60,"width":99,"height":11}},{"id":"03d25c0c-b62e-4c4b-8628-afdfe1bb21cf","block_type":"box","text":"®","page_number":113,"box":{"x":169,"y":60,"width":6,"height":5}},{"id":"07b98559-94fb-4e71-b107-a1aa0a44b5ee","block_type":"box","text":"”); and other trust preferred securities.","page_number":113,"box":{"x":177,"y":60,"width":275,"height":11}},{"id":"8f57b9a3-868f-4e36-80e7-1263943eceb5","block_type":"box","text":"Trust preferred securities are typically issued with a final maturity date, although some are perpetual in nature.","page_number":113,"box":{"x":101,"y":82,"width":790,"height":12}},{"id":"a943ccd9-d0c6-4f1d-a6b7-80ce63d0011b","block_type":"box","text":"In cer tain instances, a final maturity date may be extended and/or the final payment of principal may be deferred at","page_number":113,"box":{"x":70,"y":98,"width":825,"height":11}},{"id":"6cb73127-54f2-4c93-a414-0434bf9157f7","block_type":"box","text":"the issuer’s option for a specified time without default. No redemption can typically take place unless all cumulative","page_number":113,"box":{"x":68,"y":113,"width":827,"height":11}},{"id":"fa391a8e-b8b9-4c4d-94d7-4aeff50b1edc","block_type":"box","text":"payment obligations have been met, although issuers may be able to engage in open-market repurchases without","page_number":113,"box":{"x":70,"y":128,"width":808,"height":11}},{"id":"bc0d222c-c5bc-4cd1-8244-76fa4410c0a7","block_type":"box","text":"regard to whether all payments have been paid.","page_number":113,"box":{"x":69,"y":143,"width":338,"height":11}},{"id":"fb632a9e-6db6-41c8-84b2-16b164487a32","block_type":"box","text":"Many trust preferred securities are issued by trusts or other special purpose entities established by operating","page_number":113,"box":{"x":102,"y":166,"width":784,"height":11}},{"id":"efdecb14-e7c2-4809-a26f-27c3256b9fbe","block_type":"box","text":"companies and are not a direct obligation of an operating company. At the time the trust or special purpose entity","page_number":113,"box":{"x":69,"y":181,"width":811,"height":11}},{"id":"b1bccedc-3e5f-46bb-b452-3067055ad7a0","block_type":"box","text":"sells such preferred securities to investors, it purchases debt of the operating company (with terms comparable to","page_number":113,"box":{"x":69,"y":196,"width":817,"height":11}},{"id":"8919abe1-9825-4b13-9c63-7a5458898cd9","block_type":"box","text":"those of the trust or special purpose entity securities), which enables the operating company to deduct for tax","page_number":113,"box":{"x":68,"y":211,"width":785,"height":11}},{"id":"d9f6e6ee-5962-4312-a074-ef7adddd7630","block_type":"box","text":"purposes the interest paid on the debt held by the trust or special purpose entity. The trust or special purpose entity","page_number":113,"box":{"x":70,"y":226,"width":830,"height":11}},{"id":"38977267-9723-4558-860d-053b25024ea2","block_type":"box","text":"is generally required to be treated as transparent for U.S. federal income tax purposes such that the holders of the","page_number":113,"box":{"x":70,"y":241,"width":819,"height":11}},{"id":"e4fba8aa-fbe8-4883-99a5-49fe0cc077f7","block_type":"box","text":"trust preferred securities are treated as owning beneficial interests in the underlying debt of the operating company.","page_number":113,"box":{"x":68,"y":256,"width":827,"height":12}},{"id":"9cb5f76e-e5bc-4095-982f-c8cb2c852efc","block_type":"box","text":"Accordingly, payments on the trust preferred securities are treated as interest rather than dividends for U.S. federal","page_number":113,"box":{"x":68,"y":271,"width":824,"height":12}},{"id":"c5fb56fd-e076-456f-9d7a-cc9c3af921b9","block_type":"box","text":"income tax purposes. The trust or special purpose entity in turn would be a holder of the operating company’s debt","page_number":113,"box":{"x":70,"y":286,"width":819,"height":12}},{"id":"5e120683-b158-4fc4-9f84-d617c853b04f","block_type":"box","text":"and would have priority with respect to the operating company’s earnings and profits over the operating company’s","page_number":113,"box":{"x":69,"y":302,"width":817,"height":11}},{"id":"a5521554-1a63-42fc-bba8-ab91e314c064","block_type":"box","text":"common shareholders, but would typically be subordinated to other classes of the operating company’s debt.","page_number":113,"box":{"x":69,"y":317,"width":778,"height":11}},{"id":"242f07f6-1885-4108-ba20-384c2bd0863a","block_type":"box","text":"Typically a preferred share has a rating that is slightly below that of its corresponding operating company’s senior","page_number":113,"box":{"x":68,"y":332,"width":811,"height":11}},{"id":"144c70ec-8ecd-44df-a649-11ce7a4acb25","block_type":"box","text":"debt securities.","page_number":113,"box":{"x":69,"y":347,"width":109,"height":9}},{"id":"10619d08-375e-448a-a2b3-862d9b36e679","block_type":"box","text":"Real Estate Investment Trusts (“REITs”).","page_number":113,"box":{"x":102,"y":370,"width":300,"height":11}},{"id":"d09aa7da-4853-4911-9291-e914a6993d7b","block_type":"box","text":"In pursuing its investment strategy, a Fund may invest in shares of","page_number":113,"box":{"x":409,"y":370,"width":473,"height":11}},{"id":"7a3cf77a-753c-4f41-96d0-73102f2ab320","block_type":"box","text":"REITs. REITs possess cer tain risks which differ from an investment in common stocks. REITs are financial vehicles","page_number":113,"box":{"x":70,"y":385,"width":814,"height":11}},{"id":"48ba287c-ac47-48d6-8569-ebc1adfb8799","block_type":"box","text":"that pool investor’s capital to purchase or finance real estate. REITs may concentrate their investments in specific","page_number":113,"box":{"x":68,"y":400,"width":814,"height":11}},{"id":"79998643-174b-4793-9235-11874b669105","block_type":"box","text":"geographic areas or in specific proper ty types,","page_number":113,"box":{"x":68,"y":415,"width":329,"height":11}},{"id":"c3ed7680-d7d3-4dd5-afaf-704f535be650","block_type":"box","text":"i.e.","page_number":113,"box":{"x":405,"y":415,"width":20,"height":9}},{"id":"01b257bc-089b-43f1-ae8d-0358f4e3f8b7","block_type":"box","text":", hotels, shopping malls, residential complexes and office","page_number":113,"box":{"x":428,"y":415,"width":411,"height":11}},{"id":"3cd93f40-1e6c-4c85-8733-ca26a5442c91","block_type":"box","text":"buildings.","page_number":113,"box":{"x":69,"y":430,"width":66,"height":11}},{"id":"6f6eb238-ecd5-406c-a32d-dc7732717a62","block_type":"box","text":"REITs are subject to management fees and other expenses, and so a Fund that invests in REITs will bear its","page_number":113,"box":{"x":102,"y":453,"width":768,"height":11}},{"id":"aa22e791-328c-4f01-964e-ae43f6d294ab","block_type":"box","text":"propor tionate share of the costs of the REITs’ operations. There are three general categories of REITs: Equity REITs,","page_number":113,"box":{"x":70,"y":468,"width":824,"height":11}},{"id":"d5f1cd13-4cd6-4c46-9766-04b1cdeb7ea8","block_type":"box","text":"Mor tgage REITs and Hybrid REITs. Equity REITs invest primarily in direct fee ownership or leasehold ownership of real","page_number":113,"box":{"x":70,"y":483,"width":829,"height":11}},{"id":"707dc050-c7b5-4a5d-87fb-623d1bc637f4","block_type":"box","text":"proper ty, which derive most of their income from rents. Mor tgage REITs invest mostly in mor tgages on real estate,","page_number":113,"box":{"x":70,"y":498,"width":813,"height":11}},{"id":"318e3f3f-cd20-49f0-a2ba-db1c03d36f63","block_type":"box","text":"which may secure construction, development or long-term loans; the main source of their income is mor tgage","page_number":113,"box":{"x":68,"y":513,"width":782,"height":12}},{"id":"8621029a-4a4d-438e-8034-48a5202e60fb","block_type":"box","text":"interest payments. Hybrid REITs hold both ownership and mor tgage interests in real estate.","page_number":113,"box":{"x":70,"y":529,"width":649,"height":11}},{"id":"5cfa3215-3b9e-464f-ae9d-86228b2f8fa9","block_type":"box","text":"Investing in REITs involves cer tain unique risks in addition to those risks associated with investing in the real","page_number":113,"box":{"x":102,"y":551,"width":776,"height":11}},{"id":"93128b32-ac5c-41e2-9ef8-c658e5ed5560","block_type":"box","text":"estate industry in general. The market value of REIT shares and the ability of the REITs to distribute income may be","page_number":113,"box":{"x":69,"y":566,"width":822,"height":11}},{"id":"05461144-0c9a-4492-a6e2-cfbc85c37b9d","block_type":"box","text":"adversely affected by several factors, including rising interest rates, changes in the national, state and local","page_number":113,"box":{"x":69,"y":581,"width":769,"height":12}},{"id":"a7eb5596-012f-4d48-867c-8b4628385dfe","block_type":"box","text":"economic climate and real estate conditions, occupancy and rental rates, perceptions of prospective tenants of the","page_number":113,"box":{"x":69,"y":596,"width":822,"height":12}},{"id":"df318dc0-2569-4de3-942d-ba41f879932e","block_type":"box","text":"safety, convenience and attractiveness of the proper ties, the ability of the owners to provide adequate management,","page_number":113,"box":{"x":69,"y":612,"width":831,"height":11}},{"id":"6052a02c-4713-4edc-8d2f-4556cbf26270","block_type":"box","text":"maintenance and insurance, the cost of complying with the Americans with Disabilities Act, increased competition","page_number":113,"box":{"x":69,"y":627,"width":810,"height":11}},{"id":"2d239683-d436-4293-806f-5e9cfbed6c4e","block_type":"box","text":"from new proper ties, the impact of present or future environmental legislation and compliance with environmental","page_number":113,"box":{"x":68,"y":642,"width":812,"height":11}},{"id":"870be9ca-3bc2-4ba3-920b-58bcbf65ec1a","block_type":"box","text":"laws, failing to maintain their exemptions from registration under the Investment Company Act, changes in real estate","page_number":113,"box":{"x":70,"y":657,"width":838,"height":11}},{"id":"d27e60fd-3f49-4a97-bfd8-2f7f85ad5c1f","block_type":"box","text":"taxes and other operating expenses, adverse changes in governmental rules and fiscal policies, adverse changes in","page_number":113,"box":{"x":68,"y":672,"width":826,"height":11}},{"id":"c75b3be8-3a71-4470-b58a-fa9cb0c0f28e","block_type":"box","text":"zoning laws and other factors beyond the control of the issuers of the REITs. To the extent that assets underlying a","page_number":113,"box":{"x":69,"y":687,"width":817,"height":11}},{"id":"485faa32-86cd-4ce3-8d15-5e0e6dfd5dcd","block_type":"box","text":"REIT are concentrated geographically, by proper ty type, or in cer tain other respects, these risks may be heightened.","page_number":113,"box":{"x":70,"y":703,"width":822,"height":11}},{"id":"67e7f81d-3b17-425a-94fb-b7ec798f3674","block_type":"box","text":"In addition, distributions received by a Fund from REITs may consist of dividends, capital gains and/or return of","page_number":113,"box":{"x":70,"y":717,"width":792,"height":12}},{"id":"f3d41808-5391-4355-ac49-e6cf405079b3","block_type":"box","text":"capital. As REITs generally pay a higher rate of dividends (on a pre-tax basis) than operating companies, to the extent","page_number":113,"box":{"x":69,"y":732,"width":834,"height":12}},{"id":"be611e94-4b89-4c13-907b-e79800bde35d","block_type":"box","text":"application of the Fund’s investment strategy results in the Fund investing in REIT shares, the percentage of the","page_number":113,"box":{"x":69,"y":748,"width":798,"height":11}},{"id":"f7a80d4d-a73c-40ab-9283-8a5119fb8d43","block_type":"box","text":"Fund’s dividend income received from REIT shares will likely exceed the percentage of the Fund’s por tfolio which is","page_number":113,"box":{"x":70,"y":763,"width":818,"height":11}},{"id":"a4e131ef-49a3-4409-95ee-c3ccdb67140c","block_type":"box","text":"comprised of REIT shares. Ordinary REIT dividends received by the Fund and distributed to the Fund’s shareholders","page_number":113,"box":{"x":69,"y":778,"width":821,"height":11}},{"id":"c6bb3bd8-78e3-4826-aaad-1b8c7ede8f85","block_type":"box","text":"will generally be taxable as ordinary income and will not constitute “qualified dividend income.” However, a non","page_number":113,"box":{"x":68,"y":793,"width":797,"height":11}},{"id":"e280a22c-0b79-4614-9309-cd49f026073e","block_type":"box","text":"corporate taxpayer who is a direct REIT shareholder may claim a 20% “qualified business income” deduction for","page_number":113,"box":{"x":69,"y":808,"width":798,"height":11}},{"id":"c26db22f-6611-4c8e-aa66-f2ffe946913f","block_type":"box","text":"ordinary REIT dividends, and a regulated investment company may repor t dividends as eligible for this deduction to","page_number":113,"box":{"x":69,"y":823,"width":820,"height":12}},{"id":"015bb1dc-167b-4c09-84f4-551766888127","block_type":"box","text":"the extent the regulated investment company’s income is derived from ordinary REIT dividends (reduced by allocable","page_number":113,"box":{"x":68,"y":838,"width":831,"height":12}},{"id":"e217f32e-2dbb-4e3b-800d-c7351f5df727","block_type":"box","text":"regulated investment company expenses). A shareholder may treat the dividends as such provided the regulated","page_number":113,"box":{"x":69,"y":854,"width":801,"height":11}},{"id":"06a30945-d368-47fe-94d3-c389980d5b84","block_type":"box","text":"investment company and the shareholder satisfy applicable holding period requirements.","page_number":113,"box":{"x":70,"y":869,"width":631,"height":11}},{"id":"1913a573-4988-4b28-adfd-ae01f9a387dc","block_type":"box","text":"REITs (especially mor tgage REITs) are also subject to interest rate risk. Rising interest rates may cause REIT","page_number":113,"box":{"x":102,"y":891,"width":772,"height":12}},{"id":"866daa23-3b23-498a-87ba-dc3503a5c83e","block_type":"box","text":"investors to demand a higher annual yield, which may, in turn, cause a decline in the market price of the equity","page_number":113,"box":{"x":70,"y":906,"width":790,"height":12}},{"id":"a935df7c-82a2-4f78-b157-2d3853b377c5","block_type":"box","text":"II-66","page_number":113,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"d027281b-12b8-45b0-b3e1-e5c035e71ba4","block_type":"box","text":"NM1026U-6033063-113/246","page_number":113,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"99506db0-0040-4607-b433-a40a21c230cc","block_type":"box","text":"securities issued by a REIT. Rising interest rates also generally increase the costs of obtaining financing, which could","page_number":114,"box":{"x":69,"y":45,"width":834,"height":11}},{"id":"f5ea3e1a-53b0-4c24-89e5-e66d338c3f82","block_type":"box","text":"cause the value of a Fund’s REIT investments to decline. During periods when interest rates are declining, mor tgages","page_number":114,"box":{"x":69,"y":60,"width":837,"height":11}},{"id":"bf056c2b-5fc9-45de-8479-08a3f62e744f","block_type":"box","text":"are often refinanced. Refinancing may reduce the yield on investments in mor tgage REITs. In addition, since REITs","page_number":114,"box":{"x":69,"y":75,"width":812,"height":11}},{"id":"7714771d-b2c7-432c-b73c-887b9b040e63","block_type":"box","text":"depend on payment under their mor tgage loans and leases to generate cash to make distributions to their","page_number":114,"box":{"x":69,"y":90,"width":759,"height":11}},{"id":"26b4fc5a-f53e-4f50-8c1c-60096cd93eca","block_type":"box","text":"shareholders, investments in REITs may be adversely affected by defaults on such mor tgage loans or leases.","page_number":114,"box":{"x":69,"y":105,"width":778,"height":11}},{"id":"5329d671-0606-40a8-b424-081434f0c15f","block_type":"box","text":"Investing in cer tain REITs, which often have small market capitalizations, may also involve the same risks as","page_number":114,"box":{"x":102,"y":128,"width":773,"height":11}},{"id":"b8ca89ac-b04f-4b0d-aa98-18fdc74b71b5","block_type":"box","text":"investing in other small capitalization companies. REITs may have limited financial resources and their securities may","page_number":114,"box":{"x":70,"y":143,"width":836,"height":11}},{"id":"24858ae5-2547-445e-896a-7c89f90e3d29","block_type":"box","text":"trade less frequently and in limited volume and may be subject to more abrupt or erratic price movements than larger","page_number":114,"box":{"x":68,"y":158,"width":839,"height":11}},{"id":"c2d260f8-933c-4ddb-861a-83a869fb9a4d","block_type":"box","text":"company securities. Historically, small capitalization stocks, such as REITs, have been more volatile in price than the","page_number":114,"box":{"x":69,"y":173,"width":832,"height":11}},{"id":"7947bdc4-c8ce-4629-8be5-265cf5db443a","block_type":"box","text":"larger capitalization stocks such as those included in the S&P 500 Index. The management of a REIT may be subject","page_number":114,"box":{"x":70,"y":188,"width":832,"height":12}},{"id":"64e39b83-9d4d-420b-9f0a-8170d9f417f9","block_type":"box","text":"to conflicts of interest with respect to the operation of the business of the REIT and may be involved in real estate","page_number":114,"box":{"x":68,"y":203,"width":815,"height":12}},{"id":"c5c71f74-450b-4d97-81ad-3afd60d282be","block_type":"box","text":"activities competitive with the REIT. REITs may own proper ties through joint ventures or in other circumstances in","page_number":114,"box":{"x":69,"y":219,"width":804,"height":11}},{"id":"e3d78a14-44ce-4cf7-9a1f-77e765092155","block_type":"box","text":"which the REIT may not have control over its investments. REITs may incur significant amounts of leverage.","page_number":114,"box":{"x":68,"y":234,"width":761,"height":11}},{"id":"3dd96876-1c5a-4465-8981-823d04112450","block_type":"box","text":"Market Risks/Recent Market Events.","page_number":114,"box":{"x":102,"y":256,"width":275,"height":11}},{"id":"c6db3d39-f940-4709-9068-f9ddf1383aa7","block_type":"box","text":"Securities may decline in value due to factors affecting securities","page_number":114,"box":{"x":383,"y":256,"width":466,"height":12}},{"id":"c08d65c5-df1b-4439-a464-ffd55bf2e004","block_type":"box","text":"markets generally or par ticular industries represented in the markets. The value of a security may decline due to","page_number":114,"box":{"x":69,"y":271,"width":801,"height":12}},{"id":"d8aa491f-d69b-4094-a916-b2a9d2d2322d","block_type":"box","text":"general market conditions, economic trends or events that are not specifically related to a company or to factors that","page_number":114,"box":{"x":68,"y":286,"width":837,"height":12}},{"id":"34af4fb1-ca99-46d1-a615-5b1e14264bf1","block_type":"box","text":"affect a par ticular industry or industries, or factors that affect a par ticular issuer or issuers, exchange, country,","page_number":114,"box":{"x":69,"y":302,"width":795,"height":11}},{"id":"2d862ce5-0c82-4a39-8947-0bdbf6caeefc","block_type":"box","text":"group of countries, region, market, industry, group of industries, sector or asset class. The success of a Fund’s","page_number":114,"box":{"x":68,"y":317,"width":796,"height":11}},{"id":"84eb4985-1502-4bcd-b85c-ac8646fbb476","block_type":"box","text":"activities could be affected by interest rates, availability of credit, inflation rates, economic uncer tainty, changes in","page_number":114,"box":{"x":69,"y":332,"width":817,"height":11}},{"id":"f2da4f51-6904-40d0-91d9-13d40c5938a3","block_type":"box","text":"laws, trade barriers, economic sanctions, currency exchange controls, and local, regional or global events such as","page_number":114,"box":{"x":70,"y":347,"width":812,"height":11}},{"id":"a969066c-3aa2-4396-8896-ed9d1940b364","block_type":"box","text":"war, acts of terrorism, natural and environmental disasters, the spread of infectious illness or other public health","page_number":114,"box":{"x":68,"y":362,"width":807,"height":11}},{"id":"1e9a2ad3-6dcc-45f8-af0c-6ad2881a497c","block_type":"box","text":"issues, recessions, or other events could have a significant impact on a Fund and its investments. During a general","page_number":114,"box":{"x":70,"y":377,"width":822,"height":12}},{"id":"fd90134d-ac5b-49c9-b5fc-e2061f4d533a","block_type":"box","text":"economic downturn in the securities markets, multiple asset classes may be negatively affected. These factors may","page_number":114,"box":{"x":69,"y":392,"width":828,"height":12}},{"id":"648f06f8-3902-4c6a-a2ae-8f852d1ad4ba","block_type":"box","text":"affect the level and volatility of securities prices and the liquidity of a Fund’s investments, which could impair the","page_number":114,"box":{"x":69,"y":407,"width":804,"height":12}},{"id":"70079d17-218d-48b0-914a-89ebfd4b5c43","block_type":"box","text":"Fund’s profitability or result in losses. A Fund may maintain substantial trading positions that can be adversely","page_number":114,"box":{"x":70,"y":423,"width":787,"height":11}},{"id":"5b858944-46d8-496e-980d-b241c7b0e3f1","block_type":"box","text":"affected by the level of volatility in the financial markets; the larger the positions, the greater the potential for loss.","page_number":114,"box":{"x":69,"y":438,"width":819,"height":11}},{"id":"67c9a21d-a3d3-4b98-8a8e-03a7f8d0f9ed","block_type":"box","text":"Unpredictable or unstable market conditions may result in reduced oppor tunities to find suitable investments to","page_number":114,"box":{"x":70,"y":453,"width":796,"height":11}},{"id":"9330c5ad-46dd-4ff5-bd79-3f52975735b3","block_type":"box","text":"deploy capital or make it more difficult to exit and realize value from a Fund’s existing investments. It is impor tant to","page_number":114,"box":{"x":69,"y":468,"width":832,"height":11}},{"id":"d4bf3ec4-a49a-4973-becf-cd3bff72bad6","block_type":"box","text":"understand that a Fund can incur material losses even if it reacts quickly to difficult market conditions and there can","page_number":114,"box":{"x":69,"y":483,"width":831,"height":11}},{"id":"cee3a0d8-6d0e-43ce-a272-e9bcbe5368fd","block_type":"box","text":"be no assurance that a Fund will not suffer material adverse effects from broad and rapid changes in market","page_number":114,"box":{"x":69,"y":498,"width":776,"height":11}},{"id":"b9ae10fe-588f-468c-b0e5-b673dada61c3","block_type":"box","text":"conditions.","page_number":114,"box":{"x":69,"y":514,"width":76,"height":8}},{"id":"00647b59-c140-447f-8871-ae42aa101d08","block_type":"box","text":"Periods of unusually high volatility in the financial markets and restrictive credit conditions, sometimes limited to","page_number":114,"box":{"x":102,"y":536,"width":802,"height":11}},{"id":"6e2c1176-a08c-483f-bc87-442d3f201eca","block_type":"box","text":"a par ticular sector or a geography, can occur. Some countries, including the United States, have adopted and/or are","page_number":114,"box":{"x":69,"y":551,"width":829,"height":11}},{"id":"2a6fcc30-e766-4a7b-b80f-edc2090da043","block_type":"box","text":"considering the adoption of more protectionist trade policies, a move away from the tighter financial industry","page_number":114,"box":{"x":69,"y":566,"width":775,"height":11}},{"id":"d9dad7a2-068e-4f92-8b9a-dccb1b7ee54e","block_type":"box","text":"regulations that followed the financial crisis of 2008, and/or substantially reducing corporate taxes. The exact shape","page_number":114,"box":{"x":69,"y":581,"width":833,"height":12}},{"id":"f883ad95-1a6b-4879-affb-1d4596bcf920","block_type":"box","text":"of these policies is still being considered, but the equity and debt markets may react strongly to expectations of","page_number":114,"box":{"x":69,"y":596,"width":799,"height":12}},{"id":"0a2aa8bb-be0a-4575-a37e-3e176eb0d0e5","block_type":"box","text":"change, which could increase volatility, especially if the market’s expectations are not borne out. A rise in","page_number":114,"box":{"x":69,"y":612,"width":751,"height":11}},{"id":"66ac95c6-3dbf-410b-8d8e-7a04ef47a952","block_type":"box","text":"protectionist trade policies, and the possibility of changes to some international trade agreements, could affect the","page_number":114,"box":{"x":70,"y":627,"width":822,"height":11}},{"id":"510efe01-3e32-4f89-9529-434ea6154032","block_type":"box","text":"economies of many nations in ways that cannot necessarily be foreseen at the present time. In addition, geopolitical","page_number":114,"box":{"x":69,"y":642,"width":831,"height":11}},{"id":"faeb21f1-5ef0-4df5-880b-7c8b16a49652","block_type":"box","text":"and other risks, including environmental and public health, may add to instability in world economies and markets","page_number":114,"box":{"x":69,"y":657,"width":810,"height":11}},{"id":"3db3eebc-fa93-4936-b851-2e1543a73e84","block_type":"box","text":"generally. Economies and financial markets throughout the world are increasingly interconnected. As a result, whether","page_number":114,"box":{"x":68,"y":672,"width":841,"height":11}},{"id":"c6ff12a1-9b1b-491a-9e73-2544c84a852b","block_type":"box","text":"or not a Fund invests in securities of issuers located in or with significant exposure to countries experiencing","page_number":114,"box":{"x":69,"y":687,"width":775,"height":11}},{"id":"3ee06c73-b68b-43e4-828c-3f1de005c09b","block_type":"box","text":"economic, political and/or financial difficulties, the value and liquidity of the Fund’s investments may be negatively","page_number":114,"box":{"x":69,"y":702,"width":818,"height":12}},{"id":"5ca5c28b-f969-4cd5-a68f-3a2bfd9116ed","block_type":"box","text":"affected by such events.","page_number":114,"box":{"x":69,"y":717,"width":173,"height":12}},{"id":"e933d1c0-b776-4acd-bb91-dd8904d36569","block_type":"box","text":"Governments and regulators may take actions that affect the regulation of the Fund or the instruments in which","page_number":114,"box":{"x":102,"y":740,"width":795,"height":11}},{"id":"ef55aba6-c467-43a0-addb-ac97da304172","block_type":"box","text":"the Fund invests, or the issuers of such instruments, in ways that are unforeseeable. Future legislation or regulation","page_number":114,"box":{"x":68,"y":755,"width":830,"height":11}},{"id":"4fb2d9da-37d3-49ef-8aa3-c9503e685540","block_type":"box","text":"or other governmental actions could limit or preclude the Fund’s abilities to achieve its investment objectives or","page_number":114,"box":{"x":69,"y":771,"width":796,"height":11}},{"id":"fd3a1c75-d065-4314-94e1-3d414abda382","block_type":"box","text":"otherwise adversely impact an investment in the Fund. Recent policy initiatives under taken by the U.S. government","page_number":114,"box":{"x":69,"y":786,"width":820,"height":11}},{"id":"808d2342-a988-4d98-9f2a-dece9ad42103","block_type":"box","text":"have the potential to impact international relations, trade agreements and the overall regulatory environment in ways","page_number":114,"box":{"x":69,"y":801,"width":833,"height":11}},{"id":"763a5bb8-f6b1-4d74-898d-6fccba30e295","block_type":"box","text":"that could create uncer tainty and instability in domestic and global markets and could adversely affect the","page_number":114,"box":{"x":68,"y":816,"width":759,"height":11}},{"id":"3110fa5e-b7d2-4240-afe6-917ff02705e8","block_type":"box","text":"investment per formance of the Fund. In par ticular, actions taken by the U.S. government in respect of international","page_number":114,"box":{"x":70,"y":831,"width":819,"height":11}},{"id":"5a00f13a-71c2-48ea-9346-e93d64e4f3b1","block_type":"box","text":"trade relations could lead to trade wars, increased costs for impor ted goods, disruptions in supply chains, reduced","page_number":114,"box":{"x":68,"y":846,"width":821,"height":11}},{"id":"76a23fd9-dc1a-45e2-91d2-354e9f16e4bc","block_type":"box","text":"foreign investment, and instability in regions where the Fund invests. Political and diplomatic events within the United","page_number":114,"box":{"x":68,"y":861,"width":837,"height":11}},{"id":"61699452-65c9-4e67-9f89-0bec5bcf8575","block_type":"box","text":"States, including a contentious domestic political environment, changes in political par ty control of one or more","page_number":114,"box":{"x":69,"y":876,"width":795,"height":11}},{"id":"f7a7004b-bab0-4958-8c47-b4ee39564f1d","block_type":"box","text":"branches of the U.S. Government, the U.S. Government’s inability at times to agree on a long-term budget and deficit","page_number":114,"box":{"x":69,"y":891,"width":836,"height":12}},{"id":"b654ab48-0184-421b-abb7-c98965e4ef69","block_type":"box","text":"reduction plan, the threat of a U.S. Government shutdown, and disagreements over, or threats not to increase, the","page_number":114,"box":{"x":69,"y":906,"width":817,"height":12}},{"id":"ce75e23e-c5d0-4cef-977e-561634a740c2","block_type":"box","text":"II-67","page_number":114,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"2b4cf8ab-37e5-4fa1-bfef-3cf93c0c3cd4","block_type":"box","text":"NM1026U-6033063-114/246","page_number":114,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"c497646c-ad93-4d3d-a0c9-f58b9297133c","block_type":"box","text":"U.S. Government’s borrowing limit (or “debt ceiling”), as well as political and diplomatic events abroad, may affect","page_number":115,"box":{"x":70,"y":45,"width":816,"height":11}},{"id":"8c76551f-e275-4b03-83d9-9778e346e0d9","block_type":"box","text":"investor and consumer confidence and may adversely impact financial markets and the broader economy, perhaps","page_number":115,"box":{"x":70,"y":60,"width":813,"height":11}},{"id":"f32c9d56-aa0c-43ba-9bb3-fced3f730303","block_type":"box","text":"suddenly and to a significant degree. A downgrade of the ratings of U.S. Government debt obligations, or concerns","page_number":115,"box":{"x":69,"y":75,"width":815,"height":11}},{"id":"78fcbaae-a0f7-469d-93ed-6894c5f670eb","block_type":"box","text":"about the U.S. Government’s credit quality in general, could have a substantial negative effect on the U.S. and global","page_number":115,"box":{"x":69,"y":90,"width":836,"height":11}},{"id":"67b68c91-9f27-49a5-b614-8eaccf386d82","block_type":"box","text":"economies. For example, concerns about the U.S. Government’s credit quality may cause increased volatility in the","page_number":115,"box":{"x":69,"y":105,"width":820,"height":11}},{"id":"0cf5d0f7-0971-46ca-9d8e-7767418d2700","block_type":"box","text":"stock and bond markets, higher interest rates, reduced prices and liquidity of U.S. Treasury securities, and/or","page_number":115,"box":{"x":69,"y":120,"width":785,"height":12}},{"id":"9807efc1-cb6a-4de2-a5a9-aefb7232ba2a","block_type":"box","text":"increased costs of various kinds of debt. Moreover, although the U.S. Government has honored its credit obligations,","page_number":115,"box":{"x":70,"y":135,"width":832,"height":12}},{"id":"8e13d47b-f02c-45ea-adac-351fe2fec03e","block_type":"box","text":"there remains a possibility that the United States could default on its obligations. The consequences of such an","page_number":115,"box":{"x":68,"y":150,"width":799,"height":12}},{"id":"e6c838f4-692a-43f0-b6f0-b24361ce6929","block_type":"box","text":"unprecedented event are impossible to predict, but it is likely that a default by the United States would be highly","page_number":115,"box":{"x":69,"y":166,"width":802,"height":11}},{"id":"2f852598-ee42-46b8-89ba-3f5dee5f9e2f","block_type":"box","text":"disruptive to the U.S. and global securities markets and could significantly impair the value of the Fund’s","page_number":115,"box":{"x":69,"y":181,"width":746,"height":11}},{"id":"c8b6194f-ee46-4084-ab37-e4f4dbf574b2","block_type":"box","text":"investments.","page_number":115,"box":{"x":70,"y":196,"width":89,"height":9}},{"id":"da437815-9498-4785-a4a8-5b8f9121be00","block_type":"box","text":"The COVID-19 pandemic resulted in significant market volatility, exchange suspensions and closures, declines in","page_number":115,"box":{"x":101,"y":218,"width":802,"height":12}},{"id":"ce73b72b-1b15-4a8c-afbb-65ae284f9d51","block_type":"box","text":"global financial markets, higher default rates, supply chain disruptions, and a substantial economic downturn in","page_number":115,"box":{"x":68,"y":234,"width":796,"height":11}},{"id":"c2738e44-ea69-4cba-8347-92a4fa5eddd2","block_type":"box","text":"economies throughout the world. The impact of this coronavirus, and other epidemics and pandemics that may arise","page_number":115,"box":{"x":69,"y":249,"width":830,"height":11}},{"id":"ac8429c6-6a12-4184-829b-afaf1384f90a","block_type":"box","text":"in the future, could affect the economies of many nations, individual companies and the market in general in ways","page_number":115,"box":{"x":70,"y":264,"width":813,"height":11}},{"id":"8584d8bb-fe09-40f5-8b23-0f60058d6a79","block_type":"box","text":"that cannot necessarily be foreseen at the present time. These health crises may be shor t term or long term, and","page_number":115,"box":{"x":68,"y":279,"width":812,"height":11}},{"id":"9bdd8c25-380c-466b-a278-c910deed3c6f","block_type":"box","text":"may exacerbate other pre-existing political, social and economic risks, disrupt normal market conditions and","page_number":115,"box":{"x":69,"y":294,"width":771,"height":11}},{"id":"19f466f6-f20d-4c0a-9eb7-8115ca2f2872","block_type":"box","text":"operations, and negatively impact per formance. In addition, the impact of infectious diseases in emerging developing","page_number":115,"box":{"x":69,"y":309,"width":837,"height":11}},{"id":"0ad3364b-bebc-45e1-a38f-1e458de78974","block_type":"box","text":"or emerging market countries may be greater due to less established health care systems.","page_number":115,"box":{"x":69,"y":325,"width":646,"height":11}},{"id":"f535f188-d004-4a36-b224-8afc273adc74","block_type":"box","text":"Legal and Regulatory Risks.","page_number":115,"box":{"x":102,"y":347,"width":197,"height":11}},{"id":"88e97f8a-cbba-422f-a5ff-d26e768bc336","block_type":"box","text":"The Manager is par t of a larger firm with multiple business lines active in multiple","page_number":115,"box":{"x":305,"y":347,"width":583,"height":11}},{"id":"196049ef-0acb-460f-88bc-c999f5803265","block_type":"box","text":"jurisdictions that are governed by a multitude of legal systems and regulatory regimes, some of which are new and","page_number":115,"box":{"x":67,"y":362,"width":819,"height":11}},{"id":"5f4cc094-b399-4203-ac21-39bdeb834b52","block_type":"box","text":"evolving. As a result, the Funds and the Manager and its affiliates are subject to extensive and sophisticated legal,","page_number":115,"box":{"x":69,"y":377,"width":820,"height":12}},{"id":"f58a9a8a-4763-4128-9bb5-2681d1ed430e","block_type":"box","text":"tax and regulatory risks, including changing laws and regulations, developing interpretations of such laws and","page_number":115,"box":{"x":68,"y":392,"width":781,"height":12}},{"id":"6bcf9a7e-face-4862-bc5e-4a0ae307bc54","block_type":"box","text":"regulations, as well as existing laws, and increased scrutiny by regulators and law enforcement authorities.","page_number":115,"box":{"x":69,"y":407,"width":763,"height":12}},{"id":"3fd4e65d-3706-497c-a0b8-b0f104c0e482","block_type":"box","text":"Unexpected economic, political, regulatory and diplomatic events within the United States and abroad can trigger new","page_number":115,"box":{"x":70,"y":423,"width":838,"height":11}},{"id":"963c57aa-9b09-4eca-8e6a-719a32b7d4d5","block_type":"box","text":"and complex regulations that the Manager and/or the Funds may need to comply with. The implementation of","page_number":115,"box":{"x":69,"y":438,"width":781,"height":11}},{"id":"44f4b773-da03-45ca-b315-c2bc00b9102d","block_type":"box","text":"changes to comply with current and/or new regulations applicable to the Funds and/or the Manager could have a","page_number":115,"box":{"x":69,"y":453,"width":807,"height":11}},{"id":"e1b65551-8cb0-4740-a3ca-478ad34c460a","block_type":"box","text":"material adverse effect on the Funds (including by imposing material costs on the Funds, reducing profit margins,","page_number":115,"box":{"x":69,"y":468,"width":807,"height":11}},{"id":"c3357443-da5a-4555-b961-a8621ce7a57f","block_type":"box","text":"reducing investment oppor tunities or by otherwise restricting the Funds and/or the Manager).","page_number":115,"box":{"x":69,"y":483,"width":666,"height":11}},{"id":"b0ce8a77-933a-4487-ac9a-8aa52d3f146f","block_type":"box","text":"Tariff and Trade Policy Risks.","page_number":115,"box":{"x":103,"y":506,"width":202,"height":11}},{"id":"b904ec36-8014-4b06-95f8-5b90b7ad71d7","block_type":"box","text":"Some countries, including the U.S., have adopted more protectionist trade policies.","page_number":115,"box":{"x":312,"y":506,"width":593,"height":11}},{"id":"0dcedb9e-32bf-4571-b922-a991b61d356b","block_type":"box","text":"The U.S. government recently altered its approach to international trade policy, resulting in significant impacts on","page_number":115,"box":{"x":68,"y":521,"width":806,"height":11}},{"id":"8f18da20-7dc3-43d6-add1-73b1929aebed","block_type":"box","text":"international trade relations, cer tain tax and immigration policies, and other aspects of the national and international","page_number":115,"box":{"x":70,"y":536,"width":833,"height":11}},{"id":"fe4781b3-f0f2-4a56-b45d-236e81d37c39","block_type":"box","text":"political and financial landscape. The rise in protectionist trade policies, slowing economic growth, changes to some","page_number":115,"box":{"x":70,"y":551,"width":827,"height":11}},{"id":"e978d0fd-61c5-4f43-9c59-fc40aecc31e8","block_type":"box","text":"major international trade agreements, risks associated with trade agreements between the U.S. and the European","page_number":115,"box":{"x":69,"y":566,"width":814,"height":11}},{"id":"faaa507a-b121-404d-9cb2-fdca11d96e7d","block_type":"box","text":"Union, and the risks associated with trade negotiations between the U.S. and China, could affect the economies of","page_number":115,"box":{"x":70,"y":581,"width":821,"height":12}},{"id":"0c555dc7-8acf-41e9-a2f3-d02058ca2333","block_type":"box","text":"many nations in ways that cannot necessarily be foreseen at the present time.","page_number":115,"box":{"x":69,"y":596,"width":559,"height":12}},{"id":"ecd5aa8b-b9cc-44ea-a6ed-aa0195c6d742","block_type":"box","text":"Global trade disruption, significant introductions of trade barriers, and bilateral trade frictions, together with any","page_number":115,"box":{"x":102,"y":619,"width":796,"height":11}},{"id":"dbb627bd-7c94-4737-9ddf-19c5afdd6e58","block_type":"box","text":"future downturns in the global economy resulting therefrom, could adversely affect the financial per formance of a","page_number":115,"box":{"x":68,"y":634,"width":809,"height":12}},{"id":"6b157471-aef9-413a-bd38-bef51c09efbc","block_type":"box","text":"Fund and its investments. Trade policy may be an ongoing source of instability, potentially resulting in significant","page_number":115,"box":{"x":70,"y":649,"width":799,"height":12}},{"id":"7cd88b54-292f-48d8-bc07-15221ed10bc2","block_type":"box","text":"currency fluctuations and/or having other adverse effects on international markets, international trade agreements,","page_number":115,"box":{"x":69,"y":664,"width":823,"height":12}},{"id":"2f2f2644-ff1f-43cc-b9d4-0e7a3fdf5621","block_type":"box","text":"and/or other existing cross-border cooperation arrangements (whether economic, tax, fiscal, legal, regulatory, or","page_number":115,"box":{"x":69,"y":680,"width":801,"height":11}},{"id":"aa998d64-874f-44a1-9bf8-2f4e4f9de270","block_type":"box","text":"otherwise). To the extent trade disputes escalate globally, there could be additional significant impacts on the","page_number":115,"box":{"x":69,"y":695,"width":783,"height":11}},{"id":"9c21e738-0156-42d0-b2e7-4a087210b547","block_type":"box","text":"sectors or industries in which a Fund invests and other adverse impacts on a Fund’s overall per formance.","page_number":115,"box":{"x":69,"y":710,"width":753,"height":11}},{"id":"515bfbc2-0614-42a1-a9d5-d30942cd1436","block_type":"box","text":"Geographic Risks","page_number":115,"box":{"x":102,"y":733,"width":123,"height":11}},{"id":"9474edaa-484e-4989-8656-daf849814412","block_type":"box","text":". Some of the companies in which the Fund invests may be located in, or otherwise connected","page_number":115,"box":{"x":226,"y":732,"width":671,"height":12}},{"id":"07219fab-da1b-4ca8-ba47-8b7b1d4a5be3","block_type":"box","text":"to, par ts of the world affected by natural disasters such as severe heat, ear thquakes, tornadoes, volcanic eruptions,","page_number":115,"box":{"x":68,"y":748,"width":835,"height":11}},{"id":"a1fc6b67-3979-493f-b8a0-812a69b14bf5","block_type":"box","text":"wildfires, droughts, floods, hurricanes or tsunamis, and are economically sensitive to environmental events. In","page_number":115,"box":{"x":68,"y":763,"width":787,"height":11}},{"id":"7634317a-a9be-4ca6-9f8e-38d25c17edee","block_type":"box","text":"addition, issuers may be impacted by security concerns with respect to a country or region, such as war and other","page_number":115,"box":{"x":69,"y":778,"width":814,"height":11}},{"id":"5b809682-4e67-4672-9288-c5fd8d0e60cc","block_type":"box","text":"types of conflict, terrorism, strained international relations and territorial disputes. Any of these events may adversely","page_number":115,"box":{"x":68,"y":793,"width":840,"height":11}},{"id":"1452abd9-67c0-4e02-907f-f9f8c091cc09","block_type":"box","text":"affect the issuers, markets and economies to which a Fund is exposed, which may adversely affect the value of the","page_number":115,"box":{"x":69,"y":808,"width":824,"height":11}},{"id":"a6711b72-fe4b-483a-8c0d-dbc840fe553a","block_type":"box","text":"Fund.","page_number":115,"box":{"x":70,"y":823,"width":36,"height":9}},{"id":"00a0d305-cb9e-43a9-bcd1-d32dbcc53884","block_type":"box","text":"Reference Rate Replacement Risk.","page_number":115,"box":{"x":102,"y":846,"width":255,"height":11}},{"id":"f352698e-7fc2-430e-8167-9fcc7f3ff91f","block_type":"box","text":"The London Interbank Offered Rate (“LIBOR”) had historically been used","page_number":115,"box":{"x":363,"y":846,"width":514,"height":11}},{"id":"cbdf8656-21f7-459b-9f87-df01c1375a5b","block_type":"box","text":"extensively in the U.S. and globally as a “benchmark” or “reference rate” for various commercial and financial","page_number":115,"box":{"x":69,"y":861,"width":782,"height":11}},{"id":"710395ff-8100-4dc1-8786-b234ba9538e1","block_type":"box","text":"contracts, including corporate and municipal bonds, bank loans, asset-backed and mor tgage-related securities,","page_number":115,"box":{"x":69,"y":876,"width":791,"height":11}},{"id":"066fc3b5-32d4-48f8-b124-af3a8c59174f","block_type":"box","text":"interest rate swaps and other derivatives. Instruments in which a Fund may have historically paid interest at floating","page_number":115,"box":{"x":70,"y":891,"width":826,"height":12}},{"id":"3e568698-cc05-410a-8e6b-e67880df0584","block_type":"box","text":"rates based on LIBOR or may have been subject to interest caps or floors based on LIBOR. The Funds and issuers of","page_number":115,"box":{"x":69,"y":906,"width":834,"height":12}},{"id":"dbff2314-72fc-4603-8a2c-7951daec11da","block_type":"box","text":"II-68","page_number":115,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"226018ba-8336-465f-bc1a-42145f7893cc","block_type":"box","text":"NM1026U-6033063-115/246","page_number":115,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"21f9074b-4911-47de-810e-36b9fa2622ea","block_type":"box","text":"instruments in which a Fund invests may have also historically obtained financing at floating rates based on LIBOR. In","page_number":116,"box":{"x":70,"y":45,"width":837,"height":11}},{"id":"b1b97b66-c58d-43f0-8559-bb1b69b81559","block_type":"box","text":"connection with the global transition away from LIBOR led by regulators and market par ticipants as a result of","page_number":116,"box":{"x":69,"y":60,"width":783,"height":11}},{"id":"a7d0892a-d964-4fb0-99f8-2242b0b4046f","block_type":"box","text":"benchmark reforms, LIBOR was last published on a representative basis at the end of June 2023. Alternative","page_number":116,"box":{"x":69,"y":75,"width":779,"height":11}},{"id":"336883df-5b1e-46e3-86c4-52ac63a7c11c","block_type":"box","text":"reference rates to LIBOR have been established in most major currencies and markets in these alternative rates are","page_number":116,"box":{"x":69,"y":90,"width":830,"height":11}},{"id":"89bd5ecb-285c-46e0-99fb-1fc4877f468c","block_type":"box","text":"continuing to develop (","page_number":116,"box":{"x":69,"y":105,"width":160,"height":11}},{"id":"8fe5a58d-d9d6-49a2-982c-a21dbd3d3663","block_type":"box","text":"e.g.","page_number":116,"box":{"x":231,"y":107,"width":25,"height":9}},{"id":"3395aa43-161b-45d5-959f-061fb8a14f3f","block_type":"box","text":", the Secured Overnight Financing Rate (“SOFR”) for USD-LIBOR). While the transition from","page_number":116,"box":{"x":258,"y":105,"width":641,"height":11}},{"id":"0ee87663-a2c3-47cf-a6f4-448214f92bc2","block_type":"box","text":"LIBOR has gone relatively smoothly, residual risks associated with the transition may remain that may impact","page_number":116,"box":{"x":70,"y":120,"width":777,"height":12}},{"id":"f1b03dd5-ddfd-4878-85cc-1045a86dd8b3","block_type":"box","text":"markets or par ticular investments and, as such, the full impact of the transition on the Funds or the financial","page_number":116,"box":{"x":69,"y":135,"width":776,"height":11}},{"id":"c089db9c-689b-4913-bb81-5c4892ef9161","block_type":"box","text":"instruments in which the Funds invest cannot yet be fully determined.","page_number":116,"box":{"x":70,"y":150,"width":493,"height":12}},{"id":"218a70b0-adf4-4505-99c1-a97faaf06a0b","block_type":"box","text":"SOFR is intended to be a broad measure of the cost of borrowing funds overnight in transactions that are","page_number":116,"box":{"x":102,"y":173,"width":750,"height":11}},{"id":"a8995ebb-2852-4ec9-bdc2-4ca7f705b370","block_type":"box","text":"collateralized by U.S. Treasury securities. SOFR is calculated based on transaction-level repo data collected from","page_number":116,"box":{"x":69,"y":188,"width":803,"height":11}},{"id":"bea12f68-4e9f-4c99-9964-0225ef2697bf","block_type":"box","text":"various sources. For each trading day, SOFR is calculated as a volume-weighted median rate derived from such data.","page_number":116,"box":{"x":68,"y":203,"width":831,"height":12}},{"id":"0d798125-bda2-4abf-8e40-52ac280bd699","block_type":"box","text":"Because SOFR is a financing rate based on overnight secured funding transactions, it differs fundamentally from","page_number":116,"box":{"x":70,"y":218,"width":801,"height":12}},{"id":"a21e12e4-779a-4e86-8f3f-5700ae4be8b9","block_type":"box","text":"LIBOR. LIBOR is intended to be an unsecured rate that represents interbank funding costs for different shor t-term","page_number":116,"box":{"x":70,"y":234,"width":810,"height":11}},{"id":"7b240698-72c6-43aa-8288-9ef4cafd92c5","block_type":"box","text":"maturities or tenors. It is a forward-looking rate reflecting expectations regarding interest rates for the applicable","page_number":116,"box":{"x":69,"y":249,"width":803,"height":11}},{"id":"6060542f-8c35-4950-93a4-f809337b9ca7","block_type":"box","text":"tenor. Thus, LIBOR is intended to be sensitive, in cer tain respects, to bank credit risk and to term interest rate risk.","page_number":116,"box":{"x":68,"y":264,"width":825,"height":11}},{"id":"f8b468ec-9216-443e-a10f-48b352cddf23","block_type":"box","text":"In contrast, SOFR is a secured overnight rate reflecting the credit of U.S. Treasury securities as collateral. Thus, it is","page_number":116,"box":{"x":70,"y":279,"width":828,"height":11}},{"id":"65a66315-2bb4-4483-b707-efe18bfad422","block_type":"box","text":"largely insensitive to credit-risk considerations and to shor t-term interest rate risks. SOFR is a transaction-based rate,","page_number":116,"box":{"x":70,"y":294,"width":838,"height":11}},{"id":"81421575-e34a-4ca0-aeb8-7f5430dfec83","block_type":"box","text":"and it has been more volatile than other benchmark or market rates, such as three-month LIBOR, during cer tain","page_number":116,"box":{"x":69,"y":309,"width":796,"height":11}},{"id":"4edc8a9c-daa5-421b-9493-7127b73cf42e","block_type":"box","text":"periods. For these reasons, among others, there is no assurance that SOFR, or rates derived from SOFR, will per form","page_number":116,"box":{"x":70,"y":324,"width":836,"height":12}},{"id":"e68fd620-a62f-42e7-a187-b77a46087d75","block_type":"box","text":"in the same or similar way as LIBOR would have per formed at any time, and there is no assurance that SOFR-based","page_number":116,"box":{"x":70,"y":339,"width":824,"height":12}},{"id":"9f3bc634-69c2-4145-9ae5-c2506b1a77ec","block_type":"box","text":"rates will be a suitable substitute for LIBOR. SOFR has a relatively limited history, having been first published in April","page_number":116,"box":{"x":69,"y":355,"width":830,"height":11}},{"id":"b7db2464-5f2c-4f15-ab7f-42dca2e6d34e","block_type":"box","text":"2018. The future per formance of SOFR, and SOFR-based reference rates, cannot be predicted based on SOFR’s","page_number":116,"box":{"x":69,"y":370,"width":800,"height":11}},{"id":"bd1752e0-5db7-4e01-86d6-74962d439fba","block_type":"box","text":"history or otherwise. Levels of SOFR in the future may bear little or no relation to historical levels of SOFR, LIBOR or","page_number":116,"box":{"x":69,"y":385,"width":827,"height":11}},{"id":"a583dba5-2ead-4691-90f7-d33b61ae1c0e","block_type":"box","text":"other rates. There can also be no assurance that SOFR will not be discontinued or fundamentally altered in a manner","page_number":116,"box":{"x":69,"y":400,"width":835,"height":11}},{"id":"7f164ffd-4650-4cd9-9ce1-a17fccbd9fc3","block_type":"box","text":"that is materially adverse to the interests of the Fund.","page_number":116,"box":{"x":68,"y":415,"width":384,"height":11}},{"id":"94938041-588d-481f-b9bc-ae43038aae5b","block_type":"box","text":"In addition, interest rates or other types of rates and indices which are classified as “benchmarks” have been","page_number":116,"box":{"x":102,"y":438,"width":782,"height":11}},{"id":"c6dbf7b8-899b-487e-adcd-81fb96ffbcb8","block_type":"box","text":"the subject of ongoing national and international regulatory reform, including under the European Union (“EU”)","page_number":116,"box":{"x":68,"y":453,"width":786,"height":11}},{"id":"29b3b356-dade-436d-98a9-340ec6abfbd8","block_type":"box","text":"regulation on indices used as benchmarks in financial instruments and financial contracts (known as the","page_number":116,"box":{"x":69,"y":468,"width":746,"height":11}},{"id":"3f4115c9-cee0-4f10-84b3-28edb1851138","block_type":"box","text":"“Benchmarks Regulation”). The Benchmarks Regulation has been enacted into United Kingdom (“UK”) law by vir tue","page_number":116,"box":{"x":70,"y":483,"width":822,"height":11}},{"id":"8d522409-3131-44a2-b093-efee9272b0a6","block_type":"box","text":"of the EU (Withdrawal) Act 2018 (as amended), subject to amendments made by the Benchmarks (Amendment and","page_number":116,"box":{"x":69,"y":498,"width":821,"height":11}},{"id":"cda68d20-c1de-455a-9f16-6cad671ca6e5","block_type":"box","text":"Transitional Provision) (EU Exit) Regulations 2019 (SI 2019/657) and other statutory instruments. Following the","page_number":116,"box":{"x":68,"y":513,"width":799,"height":12}},{"id":"2dcd053e-9b99-4c1e-9620-5c089e6e1925","block_type":"box","text":"implementation of these reforms, the manner of administration of benchmarks has changed and may fur ther change","page_number":116,"box":{"x":70,"y":528,"width":830,"height":12}},{"id":"0b5de792-00fa-475d-b6b9-e1dc4f0b4d80","block_type":"box","text":"in the future, with the result that relevant benchmarks may per form differently than in the past, the use of","page_number":116,"box":{"x":70,"y":543,"width":757,"height":12}},{"id":"992a1efc-7754-4391-b9d7-977770fde7f4","block_type":"box","text":"benchmarks that are not compliant with the new standards by cer tain supervised entities may be restricted, and","page_number":116,"box":{"x":69,"y":559,"width":802,"height":11}},{"id":"0031a30f-f81e-446b-8d3c-acf4cea19683","block_type":"box","text":"cer tain benchmarks may be eliminated entirely. Such changes could cause increased market volatility and disruptions","page_number":116,"box":{"x":69,"y":574,"width":840,"height":11}},{"id":"c3ca89bd-3585-48b7-ab90-af04f18ea781","block_type":"box","text":"in liquidity for instruments that rely on or are impacted by such benchmarks. Additionally, there could be other","page_number":116,"box":{"x":70,"y":589,"width":782,"height":11}},{"id":"fb428c43-72fd-4b4b-9cf0-48a55351cb87","block_type":"box","text":"consequences which cannot be predicted.","page_number":116,"box":{"x":69,"y":604,"width":298,"height":11}},{"id":"83e05183-87c4-4a88-8bbd-2eef98c13de9","block_type":"box","text":"Repurchase Agreements and Purchase and Sale Contracts.","page_number":116,"box":{"x":102,"y":627,"width":432,"height":11}},{"id":"c08ed3d7-d6bf-480a-b7f6-09d6bb393454","block_type":"box","text":"Under repurchase agreements and purchase and","page_number":116,"box":{"x":541,"y":627,"width":347,"height":11}},{"id":"d16f8914-e3e0-47fc-ba16-15d985f40a16","block_type":"box","text":"sale contracts, the other par ty agrees, upon entering into the contract with a Fund, to repurchase a security sold to","page_number":116,"box":{"x":69,"y":642,"width":821,"height":11}},{"id":"002668cc-ed04-4349-a9fe-03551afc05a2","block_type":"box","text":"the Fund at a mutually agreed-upon time and price in a specified currency, thereby determining the yield during the","page_number":116,"box":{"x":68,"y":657,"width":815,"height":11}},{"id":"f1b0b86f-4f89-41a3-b068-008367dae5cb","block_type":"box","text":"term of the agreement.","page_number":116,"box":{"x":68,"y":672,"width":164,"height":11}},{"id":"0fb59107-6e0e-4306-825f-2b8c55348f50","block_type":"box","text":"A purchase and sale contract differs from a repurchase agreement in that the contract arrangements stipulate","page_number":116,"box":{"x":101,"y":695,"width":788,"height":11}},{"id":"0e09fc29-c2ea-4021-907f-4b0aed89971f","block_type":"box","text":"that securities are owned by the Fund and the purchaser receives any interest on the security paid during the period.","page_number":116,"box":{"x":68,"y":710,"width":831,"height":11}},{"id":"9d75ef52-5827-4e01-b4de-8170d8b1c194","block_type":"box","text":"In the case of repurchase agreements, the prices at which the trades are conducted do not reflect accrued interest","page_number":116,"box":{"x":70,"y":725,"width":821,"height":11}},{"id":"cf75835a-83c5-4d55-b27e-32bc87f8228e","block_type":"box","text":"on the underlying obligation; whereas, in the case of purchase and sale contracts, the prices take into account","page_number":116,"box":{"x":69,"y":740,"width":790,"height":11}},{"id":"e94f2121-9c30-4eff-afb8-28e6288a406d","block_type":"box","text":"accrued interest. A Fund may enter into “tri-par ty” repurchase agreements. In “tri-par ty” repurchase agreements, an","page_number":116,"box":{"x":69,"y":755,"width":827,"height":11}},{"id":"e389c949-60da-4f48-a218-b710a7789d5c","block_type":"box","text":"unaffiliated third-par ty custodian maintains accounts to hold collateral for the Fund and its counterpar ties and,","page_number":116,"box":{"x":69,"y":770,"width":788,"height":11}},{"id":"cd6146e0-d341-44de-8cf0-f6c273577c6c","block_type":"box","text":"therefore, the Fund may be subject to the credit risk of those custodians.","page_number":116,"box":{"x":68,"y":785,"width":522,"height":12}},{"id":"dafd767d-703e-48dc-8c12-40e7a01629b5","block_type":"box","text":"Some repurchase agreements and purchase and sale contracts are structured to result in a fixed rate of return","page_number":116,"box":{"x":102,"y":808,"width":792,"height":11}},{"id":"74ca3ee7-933e-4db6-83be-7cb34413d188","block_type":"box","text":"insulated from market fluctuations during the term of the agreement, although such return may be affected by","page_number":116,"box":{"x":70,"y":823,"width":784,"height":12}},{"id":"ed9985ba-c629-47af-9da9-6da23777324d","block_type":"box","text":"currency fluctuations. However, in the event of a default under a repurchase agreement or under a purchase and sale","page_number":116,"box":{"x":69,"y":838,"width":837,"height":12}},{"id":"7ab2013e-97f0-4933-8e20-144341fa087d","block_type":"box","text":"contract, instead of the contractual fixed rate, the rate of return to the Fund would be dependent upon intervening","page_number":116,"box":{"x":69,"y":853,"width":812,"height":12}},{"id":"f7ed6fc5-582a-4b97-aa6e-2038c56740b0","block_type":"box","text":"fluctuations of the market values of the securities underlying the contract and the accrued interest on those","page_number":116,"box":{"x":68,"y":869,"width":770,"height":11}},{"id":"7eea584e-fd96-4616-a8fa-ad6a9ebd9f69","block_type":"box","text":"securities. In such event, the Fund would have rights against the seller for breach of contract with respect to any","page_number":116,"box":{"x":69,"y":884,"width":802,"height":11}},{"id":"4d334f54-b6c6-463d-988b-9096b9933654","block_type":"box","text":"losses arising from market fluctuations following the default.","page_number":116,"box":{"x":70,"y":899,"width":430,"height":11}},{"id":"6d467ee8-d730-4e37-969d-3bfc5f80d85c","block_type":"box","text":"II-69","page_number":116,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"920bc4f3-2d12-4d72-af9e-2e4ed3f2e20d","block_type":"box","text":"NM1026U-6033063-116/246","page_number":116,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"13b8d3ca-f55c-400e-9e20-e821dc955629","block_type":"box","text":"Both types of agreement usually cover shor t periods, such as less than one week, although they may have","page_number":117,"box":{"x":102,"y":45,"width":759,"height":11}},{"id":"a18be508-e894-4fc4-8fef-1a1089fbb09f","block_type":"box","text":"longer terms, and may be construed to be collateralized loans by the purchaser to the seller secured by the","page_number":117,"box":{"x":70,"y":60,"width":765,"height":11}},{"id":"cd8afd04-e6f8-417a-a2c0-928b77d73fac","block_type":"box","text":"securities transferred to the purchaser. In the case of a repurchase agreement, as a purchaser, a Fund’s Manager or","page_number":117,"box":{"x":69,"y":75,"width":835,"height":11}},{"id":"44016d8d-f10e-4d6d-b19e-c7ce16db37ec","block_type":"box","text":"sub-adviser will monitor the creditwor thiness of the seller, and a Fund will require the seller to provide additional","page_number":117,"box":{"x":69,"y":90,"width":799,"height":11}},{"id":"6134e72f-4760-4a00-867f-25c734db95d7","block_type":"box","text":"collateral if the market value of the securities falls below the repurchase price at any time during the term of the","page_number":117,"box":{"x":69,"y":105,"width":801,"height":11}},{"id":"e71700d3-562e-408e-9564-42c25fc71872","block_type":"box","text":"repurchase agreement. The Fund does not have this right to seek additional collateral as a purchaser in the case of","page_number":117,"box":{"x":69,"y":120,"width":826,"height":12}},{"id":"55976e73-4074-4751-9bfa-68fe591e1811","block_type":"box","text":"purchase and sale contracts. The Fund’s Manager or sub-adviser will mark-to-market daily the value of the securities.","page_number":117,"box":{"x":70,"y":135,"width":831,"height":12}},{"id":"badc99b9-6e12-44be-bf21-374077d5d011","block_type":"box","text":"Securities subject to repurchase agreements (other than tri-par ty repurchase agreements) and purchase and sale","page_number":117,"box":{"x":69,"y":151,"width":810,"height":11}},{"id":"758ac8bd-e34d-4195-824a-040e2d036ff6","block_type":"box","text":"contracts will be held by the Fund’s custodian (or sub-custodian) in the Federal Reserve/Treasury book-entry system","page_number":117,"box":{"x":69,"y":166,"width":829,"height":11}},{"id":"9db04f68-efc0-482c-81db-b2665d5d7cb5","block_type":"box","text":"or by another authorized securities depository.","page_number":117,"box":{"x":69,"y":181,"width":329,"height":11}},{"id":"072b744e-384d-498b-8bda-4b9cc18aad7e","block_type":"box","text":"In the event of default by the seller under a repurchase agreement construed to be a collateralized loan, the","page_number":117,"box":{"x":102,"y":203,"width":770,"height":12}},{"id":"6572ceb4-7b58-4e55-bf77-d05687495965","block_type":"box","text":"underlying securities are not owned by the Fund but only constitute collateral for the seller’s obligation to pay the","page_number":117,"box":{"x":69,"y":218,"width":805,"height":12}},{"id":"2d3cd373-37e7-4744-a51f-8d7facbc14e1","block_type":"box","text":"repurchase price. Therefore, the Fund may suffer time delays and incur costs or possible losses in connection with","page_number":117,"box":{"x":69,"y":234,"width":819,"height":11}},{"id":"f1973250-ceea-4a54-baa0-5df11a777cac","block_type":"box","text":"disposition of the collateral. If the seller becomes insolvent and subject to liquidation or reorganization under","page_number":117,"box":{"x":69,"y":249,"width":778,"height":11}},{"id":"988e3dc2-e7ae-41d6-883e-9a08d6177438","block_type":"box","text":"applicable bankruptcy or other laws, a Fund’s ability to dispose of the underlying securities may be restricted. Finally,","page_number":117,"box":{"x":69,"y":264,"width":832,"height":11}},{"id":"d100aa0e-7be0-4e5f-a555-c8e0ec2d2cd0","block_type":"box","text":"it is possible that a Fund may not be able to substantiate its interest in the underlying securities. To minimize this","page_number":117,"box":{"x":70,"y":279,"width":810,"height":11}},{"id":"e15743a6-668e-4e27-9402-1d4b1b3e17a7","block_type":"box","text":"risk, the securities underlying the repurchase agreement will be held by the applicable custodian at all times in an","page_number":117,"box":{"x":69,"y":294,"width":812,"height":11}},{"id":"bd91be48-a1e3-4c1b-a2c3-6b5d456609ca","block_type":"box","text":"amount at least equal to the repurchase price, including accrued interest. If the seller fails to repurchase the","page_number":117,"box":{"x":69,"y":309,"width":778,"height":11}},{"id":"19e7e4db-2c64-453e-a11a-9dbfb587a2de","block_type":"box","text":"securities, a Fund may suffer a loss to the extent proceeds from the sale of the underlying securities are less than","page_number":117,"box":{"x":69,"y":324,"width":817,"height":12}},{"id":"55107c3b-a1a4-46ba-ad71-be130e950c0a","block_type":"box","text":"the repurchase price.","page_number":117,"box":{"x":68,"y":340,"width":151,"height":10}},{"id":"c98574b3-2358-4036-9b95-a3dc3b7c32ad","block_type":"box","text":"In any repurchase transaction to which a Fund is a par ty, collateral for a repurchase agreement may include cash","page_number":117,"box":{"x":102,"y":362,"width":805,"height":11}},{"id":"a75f1857-dc34-4745-9572-de0c676c3d76","block_type":"box","text":"items and obligations issued by the U.S. Government or its agencies or instrumentalities. For cer tain Funds, however,","page_number":117,"box":{"x":70,"y":377,"width":837,"height":12}},{"id":"a2f34e05-dd5e-45ab-bc67-34c902e65f8a","block_type":"box","text":"collateral may include instruments other than cash items and obligations issued by the U.S. Government or its","page_number":117,"box":{"x":69,"y":392,"width":788,"height":12}},{"id":"21b0932b-7c20-484f-9b78-83580f884593","block_type":"box","text":"agencies or instrumentalities, including securities that the Fund could not hold directly under its investment","page_number":117,"box":{"x":69,"y":408,"width":767,"height":11}},{"id":"9e9e92d4-666a-4b79-bcc1-354ebb37b564","block_type":"box","text":"strategies without the repurchase obligation.","page_number":117,"box":{"x":69,"y":423,"width":317,"height":11}},{"id":"cb3a73ed-9a48-4f93-9296-3f96f79419df","block_type":"box","text":"The type of collateral underlying repurchase agreements may also pose cer tain risks for a Fund. Lower quality","page_number":117,"box":{"x":101,"y":445,"width":782,"height":12}},{"id":"7a53380c-8c3a-45bf-b63f-5a63d10b4dec","block_type":"box","text":"collateral and collateral with longer maturities may be subject to greater price fluctuations than higher quality","page_number":117,"box":{"x":69,"y":460,"width":776,"height":12}},{"id":"64d9ab65-4a22-4a88-93e3-4e66b79ccd47","block_type":"box","text":"collateral and collateral with shor ter maturities. If the repurchase agreement counterpar ty were to default, lower","page_number":117,"box":{"x":69,"y":475,"width":799,"height":12}},{"id":"41fc8e34-c1b5-4770-91d4-13a326ab2354","block_type":"box","text":"quality collateral may be more difficult to liquidate than higher quality collateral. Should the counterpar ty default and","page_number":117,"box":{"x":69,"y":491,"width":829,"height":11}},{"id":"97f5a227-d373-48e5-b307-7d350a09372b","block_type":"box","text":"the amount of collateral not be sufficient to cover the counterpar ty’s repurchase obligation, a Fund would retain the","page_number":117,"box":{"x":68,"y":506,"width":825,"height":11}},{"id":"5a2333ba-4abd-4534-b5f7-564803eb029b","block_type":"box","text":"status of an unsecured creditor of the counterpar ty (","page_number":117,"box":{"x":69,"y":521,"width":374,"height":11}},{"id":"1198f267-631a-4c1c-994a-ec40c4279866","block_type":"box","text":"i.e.","page_number":117,"box":{"x":445,"y":521,"width":20,"height":9}},{"id":"6c5a923e-7e4f-4186-b64d-6f0888e4b4ab","block_type":"box","text":", the position the Fund would normally be in if it were to hold,","page_number":117,"box":{"x":468,"y":521,"width":434,"height":11}},{"id":"576544f6-40c5-4481-9bc8-a2b0e084006d","block_type":"box","text":"pursuant to its investment policies, other unsecured debt securities of the defaulting counterpar ty) with respect to","page_number":117,"box":{"x":70,"y":536,"width":813,"height":11}},{"id":"bf4818c3-1d1f-4a25-8048-3e4ce547ad50","block_type":"box","text":"the amount of the shor tfall. As an unsecured creditor, a Fund would be at risk of losing some or all of the principal","page_number":117,"box":{"x":68,"y":551,"width":816,"height":11}},{"id":"f3c87e03-8158-436e-ab6b-8a16324f1f85","block_type":"box","text":"and income involved in the transaction.","page_number":117,"box":{"x":69,"y":566,"width":278,"height":9}},{"id":"12793f31-75fa-470e-9922-ee792e5658db","block_type":"box","text":"Regulations adopted by global prudential regulators require cer tain bank-regulated counterpar ties and cer tain of","page_number":117,"box":{"x":102,"y":589,"width":800,"height":11}},{"id":"882c53e4-83bb-4753-81c4-5b3b28f53dba","block_type":"box","text":"their affiliates to include in cer tain financial contracts, including many repurchase agreements and purchase and sale","page_number":117,"box":{"x":68,"y":604,"width":840,"height":11}},{"id":"e8e2aa5e-0530-4b15-aab3-f9eff5c7f602","block_type":"box","text":"contracts, terms that delay or restrict the rights of counterpar ties, such as a Fund, to terminate such agreements,","page_number":117,"box":{"x":69,"y":619,"width":814,"height":11}},{"id":"e8790cf7-ab23-45ef-8fe9-63153a174a93","block_type":"box","text":"take foreclosure action, exercise other default rights or restrict transfers of credit suppor t in the event that the","page_number":117,"box":{"x":68,"y":634,"width":790,"height":12}},{"id":"c386b8ec-5a75-42b9-a5c0-958ed21ba7cc","block_type":"box","text":"counterpar ty and/or its affiliates are subject to cer tain types of resolution or insolvency proceedings. It is possible","page_number":117,"box":{"x":69,"y":649,"width":818,"height":12}},{"id":"360cf1bf-199c-4635-8bfb-596623df7641","block_type":"box","text":"that these requirements, as well as potential additional government regulation and other developments in the","page_number":117,"box":{"x":68,"y":665,"width":783,"height":11}},{"id":"703833dd-688c-4197-a58d-85ed1406341f","block_type":"box","text":"market, could adversely affect a Fund’s ability to terminate existing repurchase agreements and purchase and sale","page_number":117,"box":{"x":69,"y":680,"width":821,"height":11}},{"id":"97b895ff-635f-4043-bc39-c7f8b91df10b","block_type":"box","text":"contracts or to realize amounts to be received under such agreements. The SEC has also finalized rules that will","page_number":117,"box":{"x":69,"y":695,"width":800,"height":11}},{"id":"fc0baec1-b4f1-4a7b-9941-21e94f42d38b","block_type":"box","text":"require cer tain transactions involving U.S. Treasuries, including repurchase agreements, to be centrally cleared.","page_number":117,"box":{"x":69,"y":710,"width":796,"height":11}},{"id":"ef6dce4b-b7e9-4481-95e2-888de9533fa0","block_type":"box","text":"Compliance with these rules is expected to be required by the middle of 2027. Although the impact of these rules on","page_number":117,"box":{"x":69,"y":725,"width":834,"height":11}},{"id":"62b6ad0a-35c0-411d-8b34-59afc39a560d","block_type":"box","text":"the Funds is difficult to predict, they may reduce the availability or increase the costs of such transactions and may","page_number":117,"box":{"x":68,"y":740,"width":824,"height":11}},{"id":"c9b59f27-505d-400d-8161-b3e0c6d268d6","block_type":"box","text":"adversely affect a Fund’s per formance.","page_number":117,"box":{"x":69,"y":755,"width":279,"height":11}},{"id":"2bf25fac-a5c6-45f1-aae8-02dbd66f7e32","block_type":"box","text":"Restricted Securities.","page_number":117,"box":{"x":102,"y":778,"width":157,"height":9}},{"id":"66385306-4be3-49c1-80f6-53ef89efd195","block_type":"box","text":"A Fund may invest in or hold securities that are not registered under the Securities Act","page_number":117,"box":{"x":265,"y":778,"width":617,"height":11}},{"id":"7c0604cd-84d9-43df-be0f-d8eb49d738fe","block_type":"box","text":"(“restricted securities”), which may include securities in private companies and Rule 144A Securities. Restricted","page_number":117,"box":{"x":69,"y":793,"width":801,"height":11}},{"id":"8d4db492-90af-49ed-99d0-3c7004598b75","block_type":"box","text":"securities may be sold in private placement transactions between issuers and their purchasers, including through","page_number":117,"box":{"x":69,"y":808,"width":808,"height":11}},{"id":"25fa0bf3-8582-4acc-9d1f-960652792280","block_type":"box","text":"private negotiated transactions between the issuer and their purchasers, such as the Funds, and may be neither","page_number":117,"box":{"x":70,"y":823,"width":802,"height":12}},{"id":"70a83686-5849-4cd5-85b8-ceaf6b8fd67f","block_type":"box","text":"listed on an exchange nor traded in other established markets. In many cases, privately placed securities may not be","page_number":117,"box":{"x":70,"y":839,"width":834,"height":11}},{"id":"4a9d1ce8-edbc-4706-adfc-c8ce2d3b7139","block_type":"box","text":"freely transferable under the laws of the applicable jurisdiction or due to contractual restrictions on resale. Some of","page_number":117,"box":{"x":68,"y":853,"width":825,"height":12}},{"id":"5cce6802-ea90-4e57-a677-fcfacb65bcde","block_type":"box","text":"these securities are new and complex, and trade only among institutions; the markets for these securities are still","page_number":117,"box":{"x":68,"y":869,"width":815,"height":11}},{"id":"c3ad0030-c424-4724-a8b7-80fafdcb9cb3","block_type":"box","text":"developing, and may not function as efficiently as established markets. Typically, investments in private companies","page_number":117,"box":{"x":69,"y":884,"width":821,"height":11}},{"id":"265871c5-f84a-4d8f-ae16-73382c14b290","block_type":"box","text":"are in restricted securities that are not traded in public markets and subject to substantial holding periods, so that a","page_number":117,"box":{"x":69,"y":899,"width":831,"height":11}},{"id":"2c66b7ff-28b8-4ce5-bc21-4e9ebd5d0046","block_type":"box","text":"II-70","page_number":117,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"33beca61-ace5-4cce-8eb0-85a8187a21ab","block_type":"box","text":"NM1026U-6033063-117/246","page_number":117,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"70acf0fe-e545-496f-8f22-a44c926382fa","block_type":"box","text":"Fund may not be able to resell some of its holdings for extended periods, which may be several years. There can be","page_number":118,"box":{"x":70,"y":45,"width":824,"height":11}},{"id":"cad470de-84ef-4489-a65f-7c9d1893e5e9","block_type":"box","text":"no assurance that a Fund will be able to realize the value of such restricted securities in a timely manner or at all. As","page_number":118,"box":{"x":69,"y":60,"width":834,"height":11}},{"id":"1a66e4ef-68d7-4421-b95d-b9018ce13961","block_type":"box","text":"a result of the absence of a public trading market and the potential bespoke nature on cer tain transactions,","page_number":118,"box":{"x":69,"y":75,"width":769,"height":11}},{"id":"bcfd0237-41e4-400f-9bda-84a97d39ec51","block_type":"box","text":"restricted securities may be deemed to be illiquid investments or less liquid investments and may be more difficult to","page_number":118,"box":{"x":69,"y":90,"width":838,"height":11}},{"id":"365de919-0a17-4a09-a70e-ffdbf52b00df","block_type":"box","text":"value than publicly traded securities. To the extent that restricted securities may be resold in privately negotiated","page_number":118,"box":{"x":68,"y":105,"width":805,"height":11}},{"id":"97452e14-ea89-439f-aabd-1877ff6b4549","block_type":"box","text":"transactions, the prices realized from the sales, due to lack of liquidity, could be less than those originally paid by the","page_number":118,"box":{"x":68,"y":120,"width":840,"height":12}},{"id":"dbd64f59-e2c8-4f75-b1cb-34aa5c5a35e0","block_type":"box","text":"Fund or less than their fair market value. The amount of any discount may vary depending on the security type, the","page_number":118,"box":{"x":70,"y":135,"width":815,"height":12}},{"id":"03c7bbc2-355a-450a-ba2b-fcdd55ab407d","block_type":"box","text":"character of the issuer, which par ty (if any) will bear the expenses of registering the restricted security, and prevailing","page_number":118,"box":{"x":69,"y":150,"width":835,"height":12}},{"id":"ef114803-4562-4c7c-98fc-36a40997b20f","block_type":"box","text":"market conditions. In addition, issuers whose securities are not publicly traded or who are not otherwise publicly","page_number":118,"box":{"x":69,"y":166,"width":803,"height":11}},{"id":"7c58c17b-a353-459b-a1c8-2e4d8e223bf7","block_type":"box","text":"listed may not be subject to the disclosure and other investor protection requirements that may be applicable if their","page_number":118,"box":{"x":70,"y":181,"width":830,"height":11}},{"id":"b92d605e-75f3-4589-ac76-1d53c1f8b374","block_type":"box","text":"securities were publicly traded. If any privately placed securities held by a Fund are required to be registered under","page_number":118,"box":{"x":69,"y":196,"width":817,"height":11}},{"id":"65d9d550-119d-4c20-a557-2cfda1351d0a","block_type":"box","text":"the securities laws of one or more jurisdictions before being resold, the Fund may be required to bear the expenses","page_number":118,"box":{"x":68,"y":211,"width":825,"height":11}},{"id":"9d86de8b-80e8-4d55-85f5-90622f3bde36","block_type":"box","text":"of registration. Where registration is required for restricted securities, a considerable time period may elapse","page_number":118,"box":{"x":69,"y":226,"width":777,"height":11}},{"id":"51f9b607-c33d-4dae-8b63-2c1a2e9b8908","block_type":"box","text":"between the time the Fund decides to sell the security and the time it is actually permitted to sell the security under","page_number":118,"box":{"x":69,"y":241,"width":828,"height":11}},{"id":"17a2555c-550f-4f94-b9d9-9678ca468abd","block_type":"box","text":"an effective registration statement. If during such period, adverse market conditions were to develop, the Fund might","page_number":118,"box":{"x":69,"y":256,"width":834,"height":12}},{"id":"8e401f1f-9dd2-4ad8-8e6c-16abef154943","block_type":"box","text":"obtain less favorable pricing terms than when it decided to sell the security. In addition, the Fund may be deemed to","page_number":118,"box":{"x":69,"y":271,"width":828,"height":12}},{"id":"7992eb91-24cc-405b-875f-8db0c4e026d8","block_type":"box","text":"be an “underwriter” for purposes of the Securities Act when selling restricted securities. If so, the Fund may be liable","page_number":118,"box":{"x":69,"y":286,"width":836,"height":12}},{"id":"b7b07efe-bb67-467d-8c44-1b42907ed828","block_type":"box","text":"to purchasers of the restricted securities if the registration statement prepared by the issuer, or the corresponding","page_number":118,"box":{"x":68,"y":302,"width":819,"height":11}},{"id":"a1bb0b77-e5b8-4243-9669-282c5632a751","block_type":"box","text":"prospectus, is materially inaccurate or misleading. Transactions in restricted securities may entail other transaction","page_number":118,"box":{"x":70,"y":317,"width":822,"height":11}},{"id":"96f1b00b-594e-4227-a7a1-edf7e0934db9","block_type":"box","text":"costs that are higher than those for transactions in unrestricted securities. Cer tain of the Fund’s investments in","page_number":118,"box":{"x":69,"y":332,"width":798,"height":11}},{"id":"3679f6e2-5987-4be2-aaba-a5726029fd63","block_type":"box","text":"private placements may consist of direct investments and may include investments in smaller, less seasoned","page_number":118,"box":{"x":70,"y":347,"width":780,"height":11}},{"id":"bf8cbc4b-1cd7-4b76-9b0b-0fd193277076","block_type":"box","text":"issuers, which may involve greater risks. Issuers of restricted securities may not be subject to SEC repor ting","page_number":118,"box":{"x":70,"y":362,"width":773,"height":11}},{"id":"86227149-e568-474a-999d-846c5a90a529","block_type":"box","text":"requirements, may not be required to maintain their accounting records in accordance with generally accepted","page_number":118,"box":{"x":69,"y":377,"width":784,"height":12}},{"id":"c2a39f83-a456-4768-b871-7caff0019b56","block_type":"box","text":"accounting principles, and may not be required to maintain effective internal controls over financial repor ting. As a","page_number":118,"box":{"x":69,"y":392,"width":816,"height":12}},{"id":"9881c4fd-e608-4bb0-b1ce-2a6b1cd79c5a","block_type":"box","text":"result, BlackRock may not have timely or accurate information about the business, financial condition and results of","page_number":118,"box":{"x":69,"y":407,"width":828,"height":12}},{"id":"5326a6f9-12ed-4133-86d2-52f98477e53b","block_type":"box","text":"operations of such issuers, and investments in securities of such issuers may involve a high degree of business and","page_number":118,"box":{"x":69,"y":423,"width":831,"height":11}},{"id":"eb6826ee-49d7-412b-92f6-3d774d74030f","block_type":"box","text":"financial risk and may result in substantial losses to the Fund. Such issuers may also have limited product lines,","page_number":118,"box":{"x":68,"y":438,"width":804,"height":11}},{"id":"d3d74f4a-21b6-4a59-99a9-16d6b77d27d9","block_type":"box","text":"markets or financial resources, or they may be dependent on a limited management group.","page_number":118,"box":{"x":69,"y":453,"width":647,"height":11}},{"id":"99ed7db7-dc98-46d9-afde-b2af37a2239a","block_type":"box","text":"Cer tain restricted securities may represent limited investment oppor tunities and each shareholder’s","page_number":118,"box":{"x":102,"y":476,"width":714,"height":11}},{"id":"bf5d3dd7-68eb-49fb-ad6a-908057866ae8","block_type":"box","text":"propor tionate investment exposure to such limited investment oppor tunities may be reduced propor tionately as the","page_number":118,"box":{"x":70,"y":491,"width":823,"height":11}},{"id":"6e10ba20-0d91-4c24-8344-c83f0619ae34","block_type":"box","text":"Fund’s net assets grow from new or additional investments made in the Fund by other shareholders. The issuer of a","page_number":118,"box":{"x":70,"y":506,"width":826,"height":11}},{"id":"af1be387-3777-4528-9aca-2f2b02568780","block_type":"box","text":"private placement may later register those shares for public sale in an IPO, but there is no guarantee that an IPO will","page_number":118,"box":{"x":70,"y":521,"width":830,"height":11}},{"id":"a9ce6754-29a4-4745-9b45-1fc026028490","block_type":"box","text":"ever be completed. Even after an IPO, there may be a limited trading market for securities of that issuer, including","page_number":118,"box":{"x":69,"y":536,"width":812,"height":11}},{"id":"6b240792-233c-4d94-b1e7-0675c822fc59","block_type":"box","text":"any direct investment by a Fund, or the Fund may be subject to contractual limitations on its ability to resell its","page_number":118,"box":{"x":69,"y":551,"width":787,"height":11}},{"id":"45d55fe2-b1e0-40eb-8de2-230edd647f7a","block_type":"box","text":"existing securities following an IPO. The inability of an applicable issuer of a restricted security to complete an IPO or","page_number":118,"box":{"x":69,"y":566,"width":833,"height":11}},{"id":"177407f1-7bc8-42f8-b270-4305c135bb65","block_type":"box","text":"offer other liquidity oppor tunities to the Fund and other investors will extend the holding period of a Fund’s","page_number":118,"box":{"x":69,"y":581,"width":759,"height":12}},{"id":"db0ebb94-483e-45ca-a699-79b31f7f5b9f","block_type":"box","text":"investments, potentially indefinitely, and may adversely affect the value of the investments. In making investments in","page_number":118,"box":{"x":70,"y":596,"width":833,"height":12}},{"id":"9b5a3bda-fc7a-403b-a0c6-efc2d2d10150","block_type":"box","text":"such securities, a Fund may obtain access to material nonpublic information, which may restrict the Fund’s ability to","page_number":118,"box":{"x":69,"y":612,"width":828,"height":11}},{"id":"5afe9f7d-478b-49e7-ab28-d2d858ae4896","block_type":"box","text":"conduct por tfolio transactions in such securities. The activity of identifying, completing, and realizing upon attractive","page_number":118,"box":{"x":69,"y":627,"width":827,"height":11}},{"id":"540b92d7-491d-43b2-881b-4e597b50535a","block_type":"box","text":"investments in restricted securities is highly competitive and involves a high degree of uncer tainty. A Fund will be","page_number":118,"box":{"x":70,"y":642,"width":804,"height":11}},{"id":"bdc3c1d0-c15a-4290-a38c-5e76fe787d09","block_type":"box","text":"competing for investments against other similarly situated investors. It is possible that competition for appropriate","page_number":118,"box":{"x":69,"y":657,"width":816,"height":11}},{"id":"6f0e6b5d-a019-4aa9-970d-869c2e2395af","block_type":"box","text":"investment oppor tunities may increase, thus potentially reducing the number of investment oppor tunities available to","page_number":118,"box":{"x":70,"y":672,"width":835,"height":11}},{"id":"05862734-a26e-46e2-ba6b-d9dfd9e69476","block_type":"box","text":"a Fund and adversely affecting the terms upon which investments can be made. There is no assurance that","page_number":118,"box":{"x":69,"y":687,"width":768,"height":11}},{"id":"154ae5ff-a2be-4fde-a1fb-a96715fa10ba","block_type":"box","text":"investment oppor tunities for restricted securities will be available at any given time or at a level desired by a Fund,","page_number":118,"box":{"x":70,"y":702,"width":815,"height":12}},{"id":"39efb187-da2d-4eb0-8820-a29cae7a97be","block_type":"box","text":"especially as that Fund grows in size.","page_number":118,"box":{"x":69,"y":718,"width":264,"height":11}},{"id":"2cda4d7b-b628-4e5b-9a3f-01cd25d26264","block_type":"box","text":"There may not be a readily available market value for a Fund’s restricted securities (in par ticular, restricted","page_number":118,"box":{"x":101,"y":740,"width":762,"height":11}},{"id":"266c9ea4-6e26-4765-a122-dc5dc92be7bc","block_type":"box","text":"securities issued by private companies) and thus they may be considered “illiquid”. Each Fund values restricted","page_number":118,"box":{"x":69,"y":755,"width":795,"height":11}},{"id":"11420728-5feb-4478-bd8f-4b5c65409071","block_type":"box","text":"securities in accordance with BlackRock’s valuation policies and procedures, which are designed to value","page_number":118,"box":{"x":69,"y":771,"width":751,"height":11}},{"id":"355ce04e-0ee6-4b69-9fea-61007b67d754","block_type":"box","text":"investments such that they accurately reflect fair value. Due to the inherent uncer tainty and subjectivity of","page_number":118,"box":{"x":70,"y":785,"width":755,"height":12}},{"id":"ba4787fc-0e0f-4efc-8b6a-855323c38474","block_type":"box","text":"determining the fair value of investments that do not have a readily available market value, the fair value of a Fund’s","page_number":118,"box":{"x":69,"y":801,"width":830,"height":11}},{"id":"80afbd43-8743-4839-a7c2-b50c12eee0c6","block_type":"box","text":"private investments may differ significantly from the values that would have been used had a readily available market","page_number":118,"box":{"x":70,"y":816,"width":835,"height":11}},{"id":"bd44de74-ad18-40ba-b5f2-bcc8ae51b63d","block_type":"box","text":"value existed for such investments and may differ materially from the amounts the Fund may realize on any","page_number":118,"box":{"x":68,"y":831,"width":766,"height":11}},{"id":"f075c87c-e41c-42af-99a9-1066b510b696","block_type":"box","text":"dispositions of such investments. Differences in the value of the Fund’s private investments could result in the","page_number":118,"box":{"x":69,"y":846,"width":792,"height":11}},{"id":"c21550dc-aaa5-44b0-af7e-d414d6582a05","block_type":"box","text":"Fund’s shareholder transactions being effected at a NAV that does not accurately reflect the underlying value of the","page_number":118,"box":{"x":70,"y":861,"width":821,"height":11}},{"id":"1573cdfe-b738-458d-801c-a4d91a576374","block_type":"box","text":"Fund’s por tfolio, potentially resulting in the dilution of shareholder interests and increasing oppor tunities for","page_number":118,"box":{"x":70,"y":876,"width":771,"height":11}},{"id":"cd94ad3d-7fce-4b88-8346-077896dd1344","block_type":"box","text":"shareholder arbitrage. The values used by the Fund to price its restricted securities may also differ from those used","page_number":118,"box":{"x":69,"y":891,"width":826,"height":12}},{"id":"0751ee7f-4220-467a-94a0-4758ee276a0c","block_type":"box","text":"by other investment companies and investors to price the same restricted securities. In addition, the impact of","page_number":118,"box":{"x":69,"y":906,"width":790,"height":12}},{"id":"a5dbc310-4966-443d-ba51-4c6d341ccdff","block_type":"box","text":"II-71","page_number":118,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"8082b2be-3e17-4a97-92f1-0bd603213ff4","block_type":"box","text":"NM1026U-6033063-118/246","page_number":118,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"c56a39da-433e-44a6-be24-058a28cad82e","block_type":"box","text":"changes in the market environment and other events on the fair values of a Fund’s investments that have no readily","page_number":119,"box":{"x":69,"y":45,"width":828,"height":11}},{"id":"a2af4e79-14b5-432b-b047-0da07ebc9fbc","block_type":"box","text":"available market values may differ from the impact of such changes on the readily available market values for the","page_number":119,"box":{"x":69,"y":60,"width":810,"height":11}},{"id":"ae582166-6a73-4aef-833b-7ed08ac52f93","block_type":"box","text":"Fund’s other investments. A Fund’s NAV could be adversely affected if the Fund’s determinations regarding the fair","page_number":119,"box":{"x":70,"y":75,"width":818,"height":11}},{"id":"90b6a413-9097-40ac-8a3b-81585160255b","block_type":"box","text":"value of the Fund’s investments were materially higher than the investment’s actual market or fair value or the values","page_number":119,"box":{"x":68,"y":90,"width":839,"height":11}},{"id":"866494ed-9c8e-46aa-9358-6fdef90cc108","block_type":"box","text":"that the Fund ultimately realizes upon the disposal of such investments.","page_number":119,"box":{"x":68,"y":105,"width":514,"height":11}},{"id":"480d0651-7354-4863-b3cd-765e9910fad0","block_type":"box","text":"See also risks discussed under “Illiquid Investments.”","page_number":119,"box":{"x":102,"y":128,"width":385,"height":11}},{"id":"f46fc928-1794-4cbe-a10a-090aee4fa33d","block_type":"box","text":"Reverse Repurchase Agreements.","page_number":119,"box":{"x":102,"y":151,"width":246,"height":11}},{"id":"541a6eba-4aed-41a1-82a0-60ba77eca1ce","block_type":"box","text":"A Fund may enter into reverse repurchase agreements with the same par ties","page_number":119,"box":{"x":354,"y":151,"width":548,"height":11}},{"id":"0c0789be-9e20-4b36-8ff8-8ab813e4f2ea","block_type":"box","text":"with whom it may enter into repurchase agreements. Under a reverse repurchase agreement, a Fund sells securities","page_number":119,"box":{"x":68,"y":166,"width":830,"height":11}},{"id":"ae8ef9c5-d5ce-44ed-96f2-11826d19e4b1","block_type":"box","text":"to another par ty and agrees to repurchase them at a par ticular date and price. A Fund may enter into a reverse","page_number":119,"box":{"x":68,"y":181,"width":793,"height":11}},{"id":"bf82589f-edb0-472d-85ff-277331f04e96","block_type":"box","text":"repurchase agreement when it is anticipated that the interest income to be earned from the investment of the","page_number":119,"box":{"x":69,"y":196,"width":784,"height":11}},{"id":"b280c1f4-48a6-4f0b-a3fa-9bb0990efedf","block_type":"box","text":"proceeds of the transaction is greater than the interest expense of the transaction.","page_number":119,"box":{"x":70,"y":211,"width":591,"height":11}},{"id":"be66f156-0b97-4e98-a418-fbe04cd43af2","block_type":"box","text":"The use of reverse repurchase agreements may be regarded as leveraging and, therefore, speculative.","page_number":119,"box":{"x":101,"y":234,"width":730,"height":11}},{"id":"75f8b762-c510-4fb4-8484-b70f0a5852ef","block_type":"box","text":"Fur thermore, reverse repurchase agreements involve the risks that (i) the interest income earned in the investment","page_number":119,"box":{"x":70,"y":249,"width":822,"height":11}},{"id":"fd1d1400-def1-4958-aa24-99f130f9176f","block_type":"box","text":"of the proceeds will be less than the interest expense, (ii) the market value of the securities retained in lieu of sale","page_number":119,"box":{"x":69,"y":264,"width":821,"height":11}},{"id":"07bbc1d7-07d0-40bc-9054-2d74a5ff1d47","block_type":"box","text":"by a Fund may decline below the price of the securities the Fund has sold but is obligated to repurchase, (iii) the","page_number":119,"box":{"x":69,"y":279,"width":801,"height":11}},{"id":"02aafa43-9bbf-443b-8868-bcc8a21f27b9","block_type":"box","text":"market value of the securities sold will decline below the price at which the Fund is required to repurchase them and","page_number":119,"box":{"x":69,"y":294,"width":830,"height":11}},{"id":"05efe5e4-348c-40c3-b59a-bcb4c9c2c8b4","block_type":"box","text":"(iv) the securities will not be returned to the Fund.","page_number":119,"box":{"x":69,"y":309,"width":354,"height":11}},{"id":"cbe2cf6b-6375-4576-9cdb-e8cab180147f","block_type":"box","text":"In addition, if the buyer of securities under a reverse repurchase agreement files for bankruptcy or becomes","page_number":119,"box":{"x":102,"y":332,"width":769,"height":11}},{"id":"f24c8671-d789-4402-bdf2-6836482e75bc","block_type":"box","text":"insolvent, such buyer or its trustee or receiver may receive an extension of time to determine whether to enforce a","page_number":119,"box":{"x":70,"y":347,"width":815,"height":11}},{"id":"2274df88-f618-4cde-b6ef-b34f9465485a","block_type":"box","text":"Fund’s obligations to repurchase the securities and the Fund’s use of the proceeds of the reverse repurchase","page_number":119,"box":{"x":70,"y":362,"width":782,"height":11}},{"id":"28b231a9-1f6b-4976-a11b-565d9d31d756","block_type":"box","text":"agreement may effectively be restricted pending such decision.","page_number":119,"box":{"x":69,"y":377,"width":449,"height":12}},{"id":"13e83a9a-b305-4776-9b5c-1789baae3548","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into reverse repurchase agreements and","page_number":119,"box":{"x":102,"y":400,"width":794,"height":11}},{"id":"d6bd13a0-d3d9-46ec-adda-1744db86f2ec","block_type":"box","text":"similar financing transactions (","page_number":119,"box":{"x":69,"y":415,"width":218,"height":11}},{"id":"51391e94-60ce-49c3-a2d4-0fc5b48987f2","block_type":"box","text":"e.g.","page_number":119,"box":{"x":289,"y":417,"width":24,"height":9}},{"id":"43afb057-0bb1-40e1-ab45-5c45738a2d4e","block_type":"box","text":", recourse and non-recourse tender option bonds, borrowed bonds) notwithstanding","page_number":119,"box":{"x":316,"y":415,"width":594,"height":11}},{"id":"11bdfbbf-0a5b-412c-8ef1-a02f99c82982","block_type":"box","text":"the limitation on the issuance of senior securities in Section 18 of the Investment Company Act, provided that the","page_number":119,"box":{"x":68,"y":430,"width":813,"height":11}},{"id":"2b5ef055-93e4-4a59-9158-1645126daa50","block_type":"box","text":"Fund either (i) complies with the 300% asset coverage ratio with respect to all such transactions and any other","page_number":119,"box":{"x":70,"y":445,"width":789,"height":12}},{"id":"325a5627-0640-45f4-92a2-8d2f0ed574f1","block_type":"box","text":"borrowings in the aggregate, or (ii) treats all such transactions as Derivatives Transactions under Rule 18f-4. See “—","page_number":119,"box":{"x":69,"y":460,"width":836,"height":12}},{"id":"2d8fd0b4-63c6-4c40-a4aa-a60e70a7eaca","block_type":"box","text":"Derivatives — Regulation of Derivatives — Rule 18f-4 under the Investment Company Act” above. The SEC has also","page_number":119,"box":{"x":70,"y":475,"width":824,"height":12}},{"id":"5c5cec11-1cbc-4312-941b-1199954597fb","block_type":"box","text":"finalized rules that will require cer tain transactions involving U.S. Treasuries, including reverse repurchase","page_number":119,"box":{"x":68,"y":491,"width":758,"height":11}},{"id":"57e62b20-023b-4543-8e20-0b95ca377c48","block_type":"box","text":"agreements, to be centrally cleared. Compliance with these rules is expected to be required by the middle of 2027.","page_number":119,"box":{"x":69,"y":506,"width":822,"height":11}},{"id":"e65b51ef-b64e-45b3-9cbc-c223f876aa9e","block_type":"box","text":"Although the impact of these rules on the Funds is difficult to predict, they may reduce the availability or increase the","page_number":119,"box":{"x":68,"y":521,"width":838,"height":11}},{"id":"37f0a907-106c-491b-9920-5d3c90162edc","block_type":"box","text":"costs of such transactions and may adversely affect a Fund’s per formance.","page_number":119,"box":{"x":69,"y":536,"width":538,"height":11}},{"id":"1ec240a2-9f3b-45e8-912f-b1abf1cf9647","block_type":"box","text":"Additionally, regulations adopted by global prudential regulators require cer tain bank-regulated counterpar ties","page_number":119,"box":{"x":101,"y":559,"width":780,"height":11}},{"id":"3e208ed0-9f43-4e92-8e56-ab433eaa82d3","block_type":"box","text":"and cer tain of their affiliates to include in cer tain financial contracts, including many reverse repurchase agreements,","page_number":119,"box":{"x":69,"y":574,"width":838,"height":11}},{"id":"2a33e362-e3c5-4746-9238-4b388c5ea0bb","block_type":"box","text":"terms that delay or restrict the rights of counterpar ties, such as a Fund, to terminate such agreements, take","page_number":119,"box":{"x":68,"y":589,"width":775,"height":11}},{"id":"4dc18525-275d-439e-8e86-a66704d2bfd8","block_type":"box","text":"foreclosure action, exercise other default rights or restrict transfers of credit suppor t in the event that the","page_number":119,"box":{"x":68,"y":604,"width":754,"height":11}},{"id":"bc49845f-2396-4ad4-a23e-c89bbda22717","block_type":"box","text":"counterpar ty and/or its affiliates are subject to cer tain types of resolution or insolvency proceedings. It is possible","page_number":119,"box":{"x":69,"y":619,"width":818,"height":11}},{"id":"2c6cead7-1284-45bb-962e-b75bec64320c","block_type":"box","text":"that these requirements, as well as potential additional government regulation and other developments in the","page_number":119,"box":{"x":68,"y":634,"width":783,"height":12}},{"id":"bb595894-4193-4833-a930-06c8218d85a5","block_type":"box","text":"market, could adversely affect a Fund’s ability to terminate existing reverse repurchase agreements or to realize","page_number":119,"box":{"x":69,"y":649,"width":800,"height":12}},{"id":"bbdc14f2-96a3-4246-91aa-4f131333cf41","block_type":"box","text":"amounts to be received under such agreements.","page_number":119,"box":{"x":69,"y":665,"width":345,"height":11}},{"id":"ca1b3af7-3624-4ea4-8d6d-89ed90c6c001","block_type":"box","text":"Rights Offerings and Warrants to Purchase.","page_number":119,"box":{"x":102,"y":687,"width":316,"height":11}},{"id":"5d6dad81-c040-4dff-b5d6-615416d3e22c","block_type":"box","text":"Cer tain Funds may par ticipate in rights offerings and may purchase","page_number":119,"box":{"x":424,"y":687,"width":481,"height":11}},{"id":"734d7cde-9620-441f-89c0-36f338189e66","block_type":"box","text":"warrants, which are privileges issued by corporations enabling the owners to subscribe to and purchase a specified","page_number":119,"box":{"x":68,"y":702,"width":822,"height":12}},{"id":"645e7b33-1804-4123-a1ec-037e90f44416","block_type":"box","text":"number of shares of the corporation at a specified price during a specified period of time. Subscription rights","page_number":119,"box":{"x":69,"y":717,"width":776,"height":12}},{"id":"16f92d63-7f57-49f9-a083-2b8ce1d54bda","block_type":"box","text":"normally have a shor t life span to expiration. The purchase of rights or warrants involves the risk that a Fund could","page_number":119,"box":{"x":69,"y":732,"width":817,"height":12}},{"id":"358259cf-86fa-44ff-8878-04d0240b2b84","block_type":"box","text":"lose the purchase value of a right or warrant if the right to subscribe to additional shares is not exercised prior to the","page_number":119,"box":{"x":70,"y":748,"width":833,"height":11}},{"id":"c29657d1-b9e6-45b5-83e8-c80562f36a87","block_type":"box","text":"rights’ and warrants’ expiration. Also, the purchase of rights and/or warrants involves the risk that the effective price","page_number":119,"box":{"x":69,"y":763,"width":835,"height":11}},{"id":"f90f0612-0152-4e88-b806-fbd9e26d25e1","block_type":"box","text":"paid for the right and/or warrant added to the subscription price of the related security may exceed the value of the","page_number":119,"box":{"x":70,"y":778,"width":821,"height":11}},{"id":"4931e510-297c-46f7-9f28-039838bf5f6e","block_type":"box","text":"subscribed security’s market price such as when there is no movement in the level of the underlying security. Buying","page_number":119,"box":{"x":69,"y":793,"width":830,"height":11}},{"id":"ccb28c26-474a-4bd7-8118-23f319dca5af","block_type":"box","text":"a warrant does not make the Fund a shareholder of the underlying stock. The warrant holder has no voting or","page_number":119,"box":{"x":69,"y":808,"width":777,"height":11}},{"id":"89f6538d-d7c5-4da7-9f91-f342e944d06d","block_type":"box","text":"dividend rights with respect to the underlying stock. A warrant does not carry any right to assets of the issuer, and for","page_number":119,"box":{"x":69,"y":823,"width":839,"height":12}},{"id":"78f07d2d-baf5-4377-8ebd-a1d24f3e8e0d","block_type":"box","text":"this reason investments in warrants may be more speculative than other equity-based investments.","page_number":119,"box":{"x":68,"y":839,"width":708,"height":10}},{"id":"42997178-a7f8-43f5-b9bc-1f8e31e7557a","block_type":"box","text":"Rule 144A Securities.","page_number":119,"box":{"x":102,"y":861,"width":159,"height":9}},{"id":"fb937625-5e7f-491e-8709-01b1a3ec3056","block_type":"box","text":"A Fund may purchase securities that can be offered and sold only to “qualified","page_number":119,"box":{"x":266,"y":861,"width":560,"height":11}},{"id":"1a60f736-f892-451d-9112-bd1c948e4e80","block_type":"box","text":"institutional buyers” pursuant to Rule 144A under the Securities Act. See “Restricted Securities” above.","page_number":119,"box":{"x":70,"y":876,"width":741,"height":11}},{"id":"39ab861d-a788-4e7d-897d-9e1d1da4a24a","block_type":"box","text":"II-72","page_number":119,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"731389ab-085b-40f7-9d96-892e63270dbc","block_type":"box","text":"NM1026U-6033063-119/246","page_number":119,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"9bebef71-dbe2-4a62-89dd-ef1d3e8d8d59","block_type":"box","text":"Securities Lending.","page_number":120,"box":{"x":101,"y":45,"width":139,"height":11}},{"id":"44a2bb23-9fc2-4a7a-8df8-e66efa922c6e","block_type":"box","text":"Each Fund may lend por tfolio securities to cer tain borrowers that BlackRock determines to","page_number":120,"box":{"x":247,"y":45,"width":645,"height":11}},{"id":"f88c1859-5e60-4044-ad0b-1be7884a5e4e","block_type":"box","text":"be creditwor thy, including borrowers affiliated with BlackRock. The borrowers provide collateral that is maintained in","page_number":120,"box":{"x":69,"y":60,"width":825,"height":11}},{"id":"1d0ec749-ac10-470d-a52e-39df274f6c0f","block_type":"box","text":"an amount at least equal to the current market value of the securities loaned. No securities loan shall be made on","page_number":120,"box":{"x":69,"y":75,"width":817,"height":11}},{"id":"7edca91b-fdc8-4481-b205-b66efe33fa09","block_type":"box","text":"behalf of a Fund if, as a result, the aggregate value of all securities loans of the par ticular Fund exceeds one-third of","page_number":120,"box":{"x":69,"y":90,"width":831,"height":11}},{"id":"0ecc2145-8ece-4595-a9e2-8d20ecb87a15","block_type":"box","text":"the value of such Fund’s total assets (including the value of the collateral received). A Fund may terminate a loan at","page_number":120,"box":{"x":68,"y":105,"width":827,"height":11}},{"id":"3c722015-8fb8-4269-a89a-1070bf4ecc43","block_type":"box","text":"any time and obtain the return of the securities loaned. Each Fund receives, by way of substitute payment, the value","page_number":120,"box":{"x":69,"y":120,"width":829,"height":11}},{"id":"16c3f787-7135-48f5-b4d4-479dfa54f7e6","block_type":"box","text":"of any interest or cash or non-cash distributions paid on the loaned securities that it would have otherwise received if","page_number":120,"box":{"x":69,"y":135,"width":838,"height":11}},{"id":"0adbc077-cbd4-4a45-b40a-113e64e66f49","block_type":"box","text":"the securities were not on loan.","page_number":120,"box":{"x":68,"y":151,"width":225,"height":8}},{"id":"532ef975-1485-4c31-af45-ed68c03c4407","block_type":"box","text":"With respect to loans that are collateralized by cash, the borrower may be entitled to receive a fee based on the","page_number":120,"box":{"x":101,"y":173,"width":799,"height":11}},{"id":"23ef4237-7148-43aa-abe9-ecdfccf61f01","block_type":"box","text":"amount of cash collateral. The Funds are compensated by any positive difference between the amount earned on the","page_number":120,"box":{"x":69,"y":188,"width":835,"height":11}},{"id":"636733bf-3b2f-435b-a6b8-00c1e94642c1","block_type":"box","text":"reinvestment of cash collateral and the fee paid to the borrower. In the case of collateral other than cash, a Fund is","page_number":120,"box":{"x":69,"y":203,"width":824,"height":11}},{"id":"55a31dfb-a2c6-4f1a-a51a-cc812b09c5cc","block_type":"box","text":"compensated by a fee paid by the borrower equal to a percentage of the market value of the loaned securities. Any","page_number":120,"box":{"x":69,"y":218,"width":821,"height":12}},{"id":"79b09eca-87d5-4185-b11e-0b121163ea41","block_type":"box","text":"cash collateral received by the Fund for such loans, and uninvested cash, may be reinvested in cer tain shor t-term","page_number":120,"box":{"x":69,"y":234,"width":810,"height":11}},{"id":"9b5f6947-aa66-40c4-8aee-9295a480459c","block_type":"box","text":"instruments either directly on behalf of the Fund or through one or more joint accounts or money market funds,","page_number":120,"box":{"x":70,"y":249,"width":789,"height":11}},{"id":"18fbc8a0-5ff3-4e99-b75f-afc661a4152b","block_type":"box","text":"including those affiliated with BlackRock; such investments are subject to investment risk.","page_number":120,"box":{"x":70,"y":264,"width":643,"height":11}},{"id":"0d2ec394-9dc1-402d-8b27-7b0df1510112","block_type":"box","text":"Securities lending involves exposure to cer tain risks, including operational risk (","page_number":120,"box":{"x":102,"y":287,"width":568,"height":11}},{"id":"5b71ebf6-c9c7-4110-8e76-e134960dbf53","block_type":"box","text":"i.e.","page_number":120,"box":{"x":672,"y":287,"width":20,"height":9}},{"id":"e126e041-8826-46f2-978a-fa8c30282493","block_type":"box","text":", the risk of losses resulting","page_number":120,"box":{"x":695,"y":286,"width":198,"height":12}},{"id":"e2262de3-4aa9-417f-a427-a069b75d6e75","block_type":"box","text":"from problems in the settlement and accounting process), “gap” risk (","page_number":120,"box":{"x":68,"y":302,"width":501,"height":11}},{"id":"b5680219-b3b3-48f5-a8c0-a1a4fcdbc674","block_type":"box","text":"i.e.","page_number":120,"box":{"x":571,"y":302,"width":20,"height":9}},{"id":"84d2666b-e675-4c34-aa0c-dd1df53de87f","block_type":"box","text":", the risk of a mismatch between the return","page_number":120,"box":{"x":594,"y":302,"width":307,"height":10}},{"id":"23c0567a-11b2-45bb-83f4-6c3372527a87","block_type":"box","text":"on cash collateral reinvestments and the fees each Fund has agreed to pay a borrower), foreign exchange risk (","page_number":120,"box":{"x":69,"y":317,"width":794,"height":11}},{"id":"9febc23b-726c-4d68-aed5-71c3e8df9adf","block_type":"box","text":"i.e.","page_number":120,"box":{"x":865,"y":317,"width":20,"height":9}},{"id":"dcc5b3cf-2177-4036-9834-9ff18cdf2428","block_type":"box","text":",","page_number":120,"box":{"x":888,"y":324,"width":2,"height":3}},{"id":"8207178e-7893-4614-aa91-1422d19988e4","block_type":"box","text":"the risk of a shor tfall at default when a cash collateral investment is denominated in a currency other than the","page_number":120,"box":{"x":68,"y":332,"width":788,"height":11}},{"id":"55433629-c698-4d1b-aee5-e06f3eff3fa9","block_type":"box","text":"currency of the assets being loaned due to movements in foreign exchange rates), and credit, legal, counterpar ty and","page_number":120,"box":{"x":69,"y":347,"width":837,"height":11}},{"id":"6759c411-db2f-44b9-89a9-c62345d4ddcf","block_type":"box","text":"market risks (including the risk that market events, including but not limited to corporate actions, could lead a Fund","page_number":120,"box":{"x":69,"y":362,"width":822,"height":11}},{"id":"c8bd5d27-3843-4c88-ab6f-90181bcc8350","block_type":"box","text":"to lend securities that are trading at a premium due to increased demand, or to recall loaned securities or to lend","page_number":120,"box":{"x":68,"y":377,"width":811,"height":12}},{"id":"2bc5db9f-3e89-4348-a082-fc1956df7e09","block_type":"box","text":"less or not at all, which could lead to reduced securities lending revenue). If a Fund were to lend out securities that","page_number":120,"box":{"x":70,"y":392,"width":820,"height":12}},{"id":"12026dbb-3ac0-4113-9668-28125b8675d2","block_type":"box","text":"are subject to a corporate action and commit to the borrower a par ticular election as determined by the Fund’s","page_number":120,"box":{"x":69,"y":408,"width":790,"height":11}},{"id":"a15e5c88-5a38-4e75-96e8-09b07cc5c780","block_type":"box","text":"investment adviser, the benefit the Fund would receive in respect of committing to such election may or may not be","page_number":120,"box":{"x":70,"y":423,"width":820,"height":11}},{"id":"1c392ed5-38ce-443c-9472-31d54394a547","block_type":"box","text":"less than the benefit the Fund would have received from making a different election in such corporate action. If a","page_number":120,"box":{"x":70,"y":438,"width":805,"height":11}},{"id":"ce37ca92-384c-4e27-ba83-09a885aa30f0","block_type":"box","text":"securities lending counterpar ty were to default, a Fund would be subject to the risk of a possible delay in receiving","page_number":120,"box":{"x":69,"y":453,"width":816,"height":11}},{"id":"92d55419-317e-4441-bcf5-48822bc1e8f9","block_type":"box","text":"collateral or in recovering the loaned securities, or to a possible loss of rights in the collateral. In the event a","page_number":120,"box":{"x":69,"y":468,"width":775,"height":11}},{"id":"391f9e99-cbb8-4ad1-952c-36e4b15ee0f2","block_type":"box","text":"borrower does not return a Fund’s securities as agreed, the Fund’s ability to par ticipate in a corporate action event","page_number":120,"box":{"x":69,"y":483,"width":821,"height":11}},{"id":"12910830-d3fe-4944-bfdf-04a6cb781721","block_type":"box","text":"may be impacted, or the Fund may experience losses if the proceeds received from liquidating the collateral do not at","page_number":120,"box":{"x":69,"y":498,"width":838,"height":11}},{"id":"c89fdd84-a0aa-40f8-99a8-a99f7ccfc832","block_type":"box","text":"least equal the value of the loaned security at the time the collateral is liquidated, plus the transaction costs incurred","page_number":120,"box":{"x":70,"y":513,"width":837,"height":11}},{"id":"7652e567-6b68-4b96-a3ad-fbaefef84f35","block_type":"box","text":"in purchasing replacement securities. This latter event could trigger adverse tax consequences for a Fund. A Fund","page_number":120,"box":{"x":70,"y":528,"width":808,"height":12}},{"id":"110ae54d-6afa-4bda-a3d8-f36a7985a107","block_type":"box","text":"could lose money if its shor t-term investment of the collateral declines in value over the period of the loan. Substitute","page_number":120,"box":{"x":69,"y":543,"width":839,"height":12}},{"id":"8b225bde-dbe1-4585-824d-852016e56718","block_type":"box","text":"payments received by a Fund representing dividends paid on securities loaned out by the Fund will not be considered","page_number":120,"box":{"x":70,"y":559,"width":832,"height":11}},{"id":"7ac086b1-2125-48ea-8005-91d652c22232","block_type":"box","text":"qualified dividend income, and distributions by the Fund of such substitute payments will not constitute qualified","page_number":120,"box":{"x":69,"y":574,"width":801,"height":11}},{"id":"1f61f846-376d-42a1-b592-dd061a9983d1","block_type":"box","text":"dividend income. Additionally, substitute payments received by a Fund representing qualified REIT dividends paid on","page_number":120,"box":{"x":69,"y":589,"width":823,"height":11}},{"id":"621e850a-82ac-42d7-895d-b998e05c1d15","block_type":"box","text":"REIT securities loaned out by the Fund will not be considered qualified REIT dividends, and distributions by the Fund","page_number":120,"box":{"x":70,"y":604,"width":823,"height":11}},{"id":"e04a527d-a3dc-4b20-b103-88d76d8e6567","block_type":"box","text":"of such substitute payments will not be eligible for a 20% deduction currently available for ordinary REIT dividends","page_number":120,"box":{"x":69,"y":619,"width":812,"height":11}},{"id":"a5aee935-57f7-45b2-b56a-e2eba312d70f","block_type":"box","text":"paid to non-corporate shareholders provided cer tain other requirements are satisfied. The securities lending agent","page_number":120,"box":{"x":70,"y":634,"width":814,"height":12}},{"id":"df4c866f-ee17-4145-869a-d1e392fc8c50","block_type":"box","text":"will take into account the tax effects on shareholders caused by these differences in connection with a Fund’s","page_number":120,"box":{"x":68,"y":649,"width":787,"height":12}},{"id":"581efbf2-1e34-4fc9-9e4b-dfd2ccae3263","block_type":"box","text":"securities lending program. Substitute payments received on tax-exempt securities loaned out will not be tax-exempt","page_number":120,"box":{"x":69,"y":665,"width":828,"height":11}},{"id":"3d19b003-a792-4250-b021-5e58d920059e","block_type":"box","text":"income. There could also be changes in the status of issuers under applicable laws and regulations, including tax","page_number":120,"box":{"x":70,"y":680,"width":809,"height":11}},{"id":"8cf182e3-0c29-4311-a71c-17dd832055f5","block_type":"box","text":"regulations, that may impact the regulatory or tax treatment of loaned securities and could, for example, result in a","page_number":120,"box":{"x":69,"y":695,"width":821,"height":11}},{"id":"6ef1d705-82dc-46a7-83a6-394b9c378e06","block_type":"box","text":"delay in the payment of dividend equivalent payments owed to a Fund (as permitted by applicable law).","page_number":120,"box":{"x":69,"y":710,"width":731,"height":11}},{"id":"a7f4ae73-a736-43fe-ad89-4bb88d886acc","block_type":"box","text":"Regulations adopted by global prudential regulators require cer tain bank-regulated counterpar ties and cer tain of","page_number":120,"box":{"x":102,"y":732,"width":800,"height":12}},{"id":"69568190-7f10-4352-850c-7995339e1f7b","block_type":"box","text":"their affiliates to include in cer tain financial contracts, including many securities lending agreements, terms that","page_number":120,"box":{"x":68,"y":748,"width":802,"height":11}},{"id":"4a002b31-b55c-44cb-b1bc-d1c6832dd479","block_type":"box","text":"delay or restrict the rights of counterpar ties, such as the Fund, to terminate such agreements, foreclose upon","page_number":120,"box":{"x":69,"y":763,"width":783,"height":11}},{"id":"6e4f26a7-679e-475b-8ff5-d8e7b650ad53","block_type":"box","text":"collateral, exercise other default rights or restrict transfers of credit suppor t in the event that the counterpar ty and/or","page_number":120,"box":{"x":69,"y":778,"width":839,"height":11}},{"id":"a8016842-1cd7-47af-82b5-3d3dec7e5291","block_type":"box","text":"its affiliates are subject to cer tain types of resolution or insolvency proceedings. It is possible that these","page_number":120,"box":{"x":70,"y":793,"width":747,"height":11}},{"id":"6537504d-2fcc-431f-a01a-c72709bcbe26","block_type":"box","text":"requirements, as well as potential additional government regulation and other developments in the market, could","page_number":120,"box":{"x":69,"y":808,"width":806,"height":11}},{"id":"58b23703-f4e2-4456-950e-eee83ff4c77a","block_type":"box","text":"adversely affect the Fund’s ability to terminate existing securities lending agreements or to realize amounts to be","page_number":120,"box":{"x":69,"y":823,"width":808,"height":12}},{"id":"96d0a0c9-0959-4fec-817c-254e642605c0","block_type":"box","text":"received under such agreements. Prudential regulation may also favor lenders that can provide additional protections,","page_number":120,"box":{"x":69,"y":838,"width":839,"height":12}},{"id":"d3f30a46-8576-49a6-bae7-b29f4db1d9be","block_type":"box","text":"such as liens that are exercisable in connection with a lender default, to borrowers. Cer tain Funds expect to provide","page_number":120,"box":{"x":69,"y":853,"width":827,"height":11}},{"id":"acad74df-62a4-4f1d-b8e9-e2586cde27c7","block_type":"box","text":"additional protections to borrowers, where permitted pursuant to a Fund’s investment policies and if BlackRock","page_number":120,"box":{"x":69,"y":869,"width":794,"height":11}},{"id":"ed68fa84-9c0e-4507-8c7f-2bcca3e14914","block_type":"box","text":"believes doing so is in the best interest of the Fund.","page_number":120,"box":{"x":69,"y":884,"width":371,"height":11}},{"id":"f7d66063-539d-45ce-8b3a-d53d13b65e00","block_type":"box","text":"II-73","page_number":120,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"5af001ca-5431-44d2-87ce-2f63ed9bb1ec","block_type":"box","text":"NM1026U-6033063-120/246","page_number":120,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"1a278535-a73c-417f-9149-6c0ed1073fad","block_type":"box","text":"The SEC has adopted a rule that will require repor ting and public disclosure of securities loan transaction","page_number":121,"box":{"x":101,"y":45,"width":753,"height":11}},{"id":"232dbc33-195e-4114-97f5-d29276275971","block_type":"box","text":"information (not including par ty names); this may include, but is not limited to, information about securities loans","page_number":121,"box":{"x":70,"y":60,"width":808,"height":11}},{"id":"433913e7-ef94-440f-b3fc-c916778a23b0","block_type":"box","text":"entered into in connection with shor t sales. Compliance with this rule is expected to be required in late 2028,","page_number":121,"box":{"x":69,"y":75,"width":784,"height":11}},{"id":"8211b619-e139-4630-8948-43e570c7f4d4","block_type":"box","text":"although in response to the outcome of a legal challenge against the rule, the SEC may amend the rule and/or delay","page_number":121,"box":{"x":69,"y":90,"width":833,"height":11}},{"id":"4722649f-8ed7-4ccf-a540-5f8a53333fdc","block_type":"box","text":"the current expected compliance date.","page_number":121,"box":{"x":68,"y":105,"width":273,"height":11}},{"id":"4182261b-ffb5-469c-8944-ef657dedf03d","block_type":"box","text":"Short Sales.","page_number":121,"box":{"x":101,"y":128,"width":89,"height":9}},{"id":"6befb597-2838-4ac2-96b9-89d2952992d0","block_type":"box","text":"Cer tain Funds may make shor t sales of securities, either as a hedge against potential declines in","page_number":121,"box":{"x":196,"y":128,"width":696,"height":11}},{"id":"ff28ed02-87a3-434a-9163-1c7bd02dae20","block_type":"box","text":"value of a por tfolio security or to realize appreciation when a security that the Fund does not own declines in value.","page_number":121,"box":{"x":68,"y":143,"width":821,"height":11}},{"id":"f04cbc2f-2139-48d3-b0b1-716c12640775","block_type":"box","text":"Cer tain Funds have a fundamental investment restriction prohibiting shor t sales of securities unless they are","page_number":121,"box":{"x":69,"y":158,"width":778,"height":11}},{"id":"4fffd77c-2eee-4e22-bf46-aa29db658315","block_type":"box","text":"“against-the-box.” In a shor t sale “against-the-box,” at the time of the sale, the Fund owns or has the immediate and","page_number":121,"box":{"x":70,"y":173,"width":831,"height":11}},{"id":"7d2ac1ab-1589-4d2e-b57a-39e2d539bb6c","block_type":"box","text":"unconditional right to acquire the identical security at no additional cost. When a Fund makes a shor t sale, it borrows","page_number":121,"box":{"x":69,"y":188,"width":837,"height":12}},{"id":"8f752e7c-f4c6-4af4-a797-d97ea6b34db5","block_type":"box","text":"the security sold shor t and delivers it to the broker-dealer through which it made the shor t sale. A Fund may have to","page_number":121,"box":{"x":68,"y":204,"width":828,"height":11}},{"id":"6cc36926-6cde-4876-8114-9de9bdd5c3e2","block_type":"box","text":"pay a fee to borrow par ticular securities and is often obligated to turn over any payments received on such borrowed","page_number":121,"box":{"x":70,"y":218,"width":829,"height":12}},{"id":"591bca18-77e5-4dc2-afab-ca83f0c9a86a","block_type":"box","text":"securities to the lender of the securities.","page_number":121,"box":{"x":69,"y":234,"width":289,"height":9}},{"id":"6ed42a0e-b692-4e20-b430-b63b2c7f4fa4","block_type":"box","text":"A Fund secures its obligation to replace the borrowed security by depositing collateral with the broker-dealer,","page_number":121,"box":{"x":101,"y":257,"width":772,"height":11}},{"id":"f874a8b5-aec7-4610-87e7-7d55a1770a39","block_type":"box","text":"usually in cash, U.S. Government Securities or other liquid securities similar to those borrowed. With respect to","page_number":121,"box":{"x":69,"y":272,"width":795,"height":11}},{"id":"5d3a8c0b-c4db-431d-9aa0-53d462a19b19","block_type":"box","text":"uncovered shor t positions, a Fund is required to deposit similar collateral with its custodian, if necessary, to the","page_number":121,"box":{"x":69,"y":286,"width":801,"height":12}},{"id":"9533d4dc-1bad-46ce-a9be-6a70bcf43490","block_type":"box","text":"extent that the value of both collateral deposits in the aggregate is at all times equal to at least 100% of the current","page_number":121,"box":{"x":69,"y":302,"width":830,"height":11}},{"id":"808e0037-6aaf-4099-8e37-c3a9689012ac","block_type":"box","text":"market value of the security sold shor t. Depending on arrangements made with the broker-dealer from which the Fund","page_number":121,"box":{"x":69,"y":317,"width":839,"height":11}},{"id":"d01f99f2-cc19-4512-85a5-430828d53507","block_type":"box","text":"borrowed the security, regarding payment received by the Fund on such security, a Fund may not receive any","page_number":121,"box":{"x":69,"y":332,"width":770,"height":11}},{"id":"c4f5c00c-2586-4f0b-a0d8-765da8dde679","block_type":"box","text":"payments (including interest) on its collateral deposited with such broker-dealer.","page_number":121,"box":{"x":70,"y":347,"width":568,"height":11}},{"id":"4bf7b354-c2a1-45ea-9780-7c527dd61705","block_type":"box","text":"Because making shor t sales in securities that it does not own exposes a Fund to the risks associated with those","page_number":121,"box":{"x":102,"y":370,"width":806,"height":11}},{"id":"8c797a79-6f54-410a-8999-1d9dbc304aa0","block_type":"box","text":"securities, such shor t sales involve speculative exposure risk. A Fund will incur a loss as a result of a shor t sale if","page_number":121,"box":{"x":69,"y":385,"width":817,"height":11}},{"id":"dcd203dc-b6cf-48b2-98ce-221e87943470","block_type":"box","text":"the price of the security increases between the date of the shor t sale and the date on which the Fund replaces the","page_number":121,"box":{"x":68,"y":400,"width":819,"height":11}},{"id":"6545bcef-e37f-4c2e-8290-ca36de821511","block_type":"box","text":"borrowed security. As a result, if a Fund makes shor t sales in securities that increase in value, it will likely","page_number":121,"box":{"x":69,"y":415,"width":758,"height":11}},{"id":"f3223aa1-1b51-4a88-ae1e-26bd777f5236","block_type":"box","text":"underper form similar mutual funds that do not make shor t sales in securities. A Fund will realize a gain on a shor t","page_number":121,"box":{"x":69,"y":430,"width":817,"height":11}},{"id":"baa58025-8738-4314-82fb-387ed970857f","block_type":"box","text":"sale if the security declines in price between those dates. There can be no assurance that a Fund will be able to","page_number":121,"box":{"x":69,"y":445,"width":800,"height":11}},{"id":"a33915fd-b448-4b63-a577-9dfd52c21e98","block_type":"box","text":"close out a shor t sale position at any par ticular time or at an acceptable price. Although a Fund’s gain is limited to","page_number":121,"box":{"x":69,"y":461,"width":818,"height":11}},{"id":"0c98a394-3642-400d-a67e-1774fa7dc189","block_type":"box","text":"the price at which it sold the security shor t, its potential loss is limited only by the maximum attainable price of the","page_number":121,"box":{"x":68,"y":475,"width":821,"height":12}},{"id":"675dd296-81c6-4814-8df0-e191c4c59f90","block_type":"box","text":"security, less the price at which the security was sold and may, theoretically, be unlimited.","page_number":121,"box":{"x":69,"y":491,"width":640,"height":11}},{"id":"48b1ca01-fcc9-424b-ac14-b6f93aad76c2","block_type":"box","text":"A Fund may also make shor t sales “against the box” without being subject to such limitations.","page_number":121,"box":{"x":101,"y":514,"width":673,"height":11}},{"id":"41caeb76-935d-4136-82b1-71966d87b49c","block_type":"box","text":"A Fund must comply with Rule 18f-4 under the Investment Company Act with respect to its shor t sale","page_number":121,"box":{"x":101,"y":536,"width":721,"height":11}},{"id":"0e7fc80b-8902-4f1d-ad0e-e369c2a145a7","block_type":"box","text":"borrowings, which are considered Derivatives Transactions under the Rule. See “—Derivatives — Regulation of","page_number":121,"box":{"x":69,"y":551,"width":791,"height":11}},{"id":"81700e2d-91ef-477f-a3bc-7cf32b6df0c9","block_type":"box","text":"Derivatives — Rule 18f-4 under the Investment Company Act” above.","page_number":121,"box":{"x":70,"y":566,"width":489,"height":11}},{"id":"ee834fd1-1ee0-4cc2-b355-25958ffcd740","block_type":"box","text":"Shor t sales are also subject to cer tain SEC regulations and cer tain European Union and United Kingdom","page_number":121,"box":{"x":102,"y":589,"width":745,"height":11}},{"id":"b296d35b-9ba0-4a0d-86fd-7415455920f7","block_type":"box","text":"regulations (under which there are restrictions on net shor t sales in cer tain securities). If the SEC or regulatory","page_number":121,"box":{"x":69,"y":604,"width":793,"height":11}},{"id":"36545515-df51-4c06-9a7d-4237f9daf931","block_type":"box","text":"authorities in other jurisdictions were to adopt additional restrictions regarding shor t sales, they could restrict a","page_number":121,"box":{"x":69,"y":619,"width":796,"height":11}},{"id":"8d859528-25cd-41ce-a99f-ac9cd9317c8a","block_type":"box","text":"Fund’s ability to engage in shor t sales in cer tain circumstances, and the Fund may be unable to execute its","page_number":121,"box":{"x":70,"y":634,"width":766,"height":12}},{"id":"547915a3-cde1-47c1-8c29-12ad7f6dcdaf","block_type":"box","text":"investment strategy as a result. In response to market events, the SEC and regulatory authorities in other","page_number":121,"box":{"x":70,"y":649,"width":754,"height":12}},{"id":"3e913c45-8e66-49a7-b47c-c0c10743029b","block_type":"box","text":"jurisdictions may adopt (and in cer tain cases, have adopted) bans or other restrictions on shor t sales of cer tain","page_number":121,"box":{"x":67,"y":664,"width":800,"height":12}},{"id":"9240d785-de64-4013-b159-abe6a6776c6e","block_type":"box","text":"securities or on derivatives and other hedging instruments used to achieve a similar economic effect. Such bans or","page_number":121,"box":{"x":69,"y":680,"width":823,"height":11}},{"id":"d59fecbe-0c93-4ef8-85ff-e9314d3594c4","block_type":"box","text":"other restrictions may make it impossible for a Fund to execute cer tain investment strategies and may have a","page_number":121,"box":{"x":69,"y":695,"width":782,"height":11}},{"id":"8f422ad8-5cc6-47d7-a7d3-e1397eef8f72","block_type":"box","text":"material adverse effect on the Fund’s ability to generate returns.","page_number":121,"box":{"x":69,"y":710,"width":460,"height":11}},{"id":"a4d672f4-b65b-47ff-9b3d-5d3a6cd793e0","block_type":"box","text":"Special Purpose Acquisition Companies.","page_number":121,"box":{"x":101,"y":733,"width":293,"height":11}},{"id":"1061f8d9-1327-41e4-bac2-191ce6c961a8","block_type":"box","text":"A Fund may invest in stock, warrants, rights and other interests issued","page_number":121,"box":{"x":400,"y":733,"width":504,"height":11}},{"id":"99aa58ef-7cde-482f-867c-c1aba68e44ef","block_type":"box","text":"by special purpose acquisition companies (“SPACs”) or similar special purpose entities that pool funds to seek","page_number":121,"box":{"x":69,"y":748,"width":791,"height":11}},{"id":"0093cfcc-292a-4329-89fe-32224e69dd0c","block_type":"box","text":"potential acquisition oppor tunities, including the “founder’s” shares and warrants described below. A SPAC is a","page_number":121,"box":{"x":70,"y":763,"width":793,"height":11}},{"id":"c29d5d0e-564e-4851-9407-31d299a70b92","block_type":"box","text":"publicly traded company that raises investment capital via an IPO for the purpose of identifying and acquiring one or","page_number":121,"box":{"x":70,"y":778,"width":824,"height":11}},{"id":"1cc116d9-0cef-4704-8577-e08c3108ad47","block_type":"box","text":"more operating businesses or assets. In connection with forming a SPAC, the SPAC’s sponsors acquire “founder’s”","page_number":121,"box":{"x":69,"y":793,"width":821,"height":11}},{"id":"1a9cce41-9ab4-411c-9827-88761fc74232","block_type":"box","text":"shares, generally for nominal consideration, and warrants that will result in the sponsors owning a specified","page_number":121,"box":{"x":69,"y":808,"width":768,"height":11}},{"id":"d687ddcd-b418-4ae6-942f-42e0932881b5","block_type":"box","text":"percentage (typically 20%) of the SPAC’s outstanding common stock upon completion of the IPO. At the time a SPAC","page_number":121,"box":{"x":70,"y":823,"width":826,"height":12}},{"id":"b7fc0735-0a66-407f-b2bb-671ce7e1815a","block_type":"box","text":"conducts an IPO, it has selected a management team but has not yet identified a specific acquisition oppor tunity.","page_number":121,"box":{"x":69,"y":838,"width":809,"height":12}},{"id":"ba2d3ea1-fa13-415c-9a36-cb9b60906601","block_type":"box","text":"Unless and until an acquisition is completed, a SPAC generally invests its assets in U.S. Government securities,","page_number":121,"box":{"x":70,"y":854,"width":797,"height":11}},{"id":"ae5207e5-9081-4c02-a6c8-5c592e2e1101","block_type":"box","text":"money market securities and cash. If an acquisition that meets the requirements for the SPAC is not completed","page_number":121,"box":{"x":69,"y":869,"width":795,"height":11}},{"id":"d044c89d-b260-42b8-8972-027f06ea53e6","block_type":"box","text":"within a pre-established period of time, the invested funds are returned to the SPAC’s public shareholders, the","page_number":121,"box":{"x":68,"y":884,"width":788,"height":11}},{"id":"8d8a425a-c409-41a3-b3a2-a64324c2ae70","block_type":"box","text":"warrants expire, and the “founder’s” shares and such warrants become wor thless. Because SPACs and similar","page_number":121,"box":{"x":68,"y":899,"width":794,"height":11}},{"id":"5828d336-c09f-49dc-b7a0-e2c3573ea513","block_type":"box","text":"II-74","page_number":121,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"d700a65a-7a48-49ac-addc-e8f5d4a0b453","block_type":"box","text":"NM1026U-6033063-121/246","page_number":121,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"1c4c1d36-ebfc-46d1-8666-68b87f98a1c9","block_type":"box","text":"entities are in essence “blank check” companies without operating histories or ongoing business operations (other","page_number":122,"box":{"x":69,"y":45,"width":820,"height":11}},{"id":"e5c1063a-88a1-4cc1-b147-8db2456e3a66","block_type":"box","text":"than identifying and pursuing acquisitions), the potential for the long-term capital appreciation of their securities is","page_number":122,"box":{"x":68,"y":60,"width":815,"height":11}},{"id":"099a14d6-5d56-408e-8ab7-aa5543d241ae","block_type":"box","text":"par ticularly dependent on the ability of the SPAC’s management to identify and complete a profitable acquisition.","page_number":122,"box":{"x":70,"y":75,"width":802,"height":11}},{"id":"cf4e35fb-37d0-413a-8e00-c52f9c6f5b6d","block_type":"box","text":"There is no guarantee that the SPACs in which a Fund invests will complete an acquisition or that any acquisitions","page_number":122,"box":{"x":68,"y":90,"width":812,"height":11}},{"id":"20b82795-7778-41a0-acb9-77456f32cebf","block_type":"box","text":"completed by the SPACs in which the Fund invests will be profitable. Some SPACs may pursue acquisitions only within","page_number":122,"box":{"x":69,"y":105,"width":838,"height":11}},{"id":"d79c73f4-44ef-4168-a831-690044fc9bc7","block_type":"box","text":"cer tain industries or regions, which may ultimately lead to an increase in the volatility of their prices following the","page_number":122,"box":{"x":69,"y":120,"width":806,"height":12}},{"id":"aef1dd86-1550-412a-ae6a-614cdd993ad4","block_type":"box","text":"acquisition. In addition, some of these securities may be considered illiquid and/or subject to restrictions on resale.","page_number":122,"box":{"x":69,"y":135,"width":828,"height":11}},{"id":"9f16a3b5-b391-47f0-b4a2-dbeeea3d7533","block_type":"box","text":"Standby Commitment Agreements.","page_number":122,"box":{"x":101,"y":158,"width":255,"height":11}},{"id":"f180b2fb-466a-497e-8888-1bc55c87d08e","block_type":"box","text":"Standby commitment agreements commit a Fund, for a stated period of","page_number":122,"box":{"x":362,"y":158,"width":511,"height":11}},{"id":"b38715f4-a681-4ab7-bdf1-3adebc7a2bba","block_type":"box","text":"time, to purchase a stated amount of securities that may be issued and sold to that Fund at the option of the issuer.","page_number":122,"box":{"x":68,"y":173,"width":834,"height":11}},{"id":"0b51a129-8b39-402f-bed2-ff030551d53e","block_type":"box","text":"The price of the security is fixed at the time of the commitment. At the time of entering into the agreement, a Fund is","page_number":122,"box":{"x":68,"y":188,"width":834,"height":12}},{"id":"a86844f5-4db1-4bad-9f3a-d87d821b4125","block_type":"box","text":"paid a commitment fee, regardless of whether or not the security is ultimately issued. A Fund will enter into such","page_number":122,"box":{"x":70,"y":203,"width":802,"height":12}},{"id":"b7d16f26-c5f2-4894-a181-3a113faa0d3b","block_type":"box","text":"agreements for the purpose of investing in the security underlying the commitment at a price that is considered","page_number":122,"box":{"x":69,"y":218,"width":793,"height":12}},{"id":"8fe1ed5e-e0f4-4557-9fae-02a14e83d749","block_type":"box","text":"advantageous to the Fund.","page_number":122,"box":{"x":69,"y":234,"width":188,"height":11}},{"id":"f43671e1-e95b-45d1-ada9-8be3a4998c83","block_type":"box","text":"There can be no assurance that the securities subject to a standby commitment will be issued, and the value of","page_number":122,"box":{"x":101,"y":256,"width":800,"height":11}},{"id":"b55b07b5-e15d-46d9-9ae6-23f64552bfd3","block_type":"box","text":"the security, if issued, on the delivery date may be more or less than its purchase price. Since the issuance of the","page_number":122,"box":{"x":68,"y":271,"width":816,"height":12}},{"id":"3ab81384-9d7d-49e3-8890-083c8c814ffc","block_type":"box","text":"security underlying the commitment is at the option of the issuer, the Fund may bear the risk of a decline in the value","page_number":122,"box":{"x":69,"y":286,"width":835,"height":12}},{"id":"0b1cf6b8-3f9f-4b94-a3a6-8b05cc1fae43","block_type":"box","text":"of such security and may not benefit from an appreciation in the value of the security during the commitment period.","page_number":122,"box":{"x":69,"y":302,"width":828,"height":11}},{"id":"cc1d441c-8079-4ac8-8a22-bedbc6530cab","block_type":"box","text":"The purchase of a security pursuant to a standby commitment agreement and the related commitment fee will","page_number":122,"box":{"x":101,"y":324,"width":785,"height":12}},{"id":"b507c236-0b4d-4358-8cc4-a558d78dd337","block_type":"box","text":"be recorded on the date on which the security can reasonably be expected to be issued, and the value of the security","page_number":122,"box":{"x":69,"y":339,"width":837,"height":12}},{"id":"5827d8ed-3005-44b6-9f38-036915a5b956","block_type":"box","text":"thereafter will be reflected in the calculation of a Fund’s NAV. The cost basis of the security will be adjusted by the","page_number":122,"box":{"x":68,"y":355,"width":815,"height":11}},{"id":"427486ae-2dcd-4fbe-b084-c60ebbfa0592","block_type":"box","text":"amount of the commitment fee. In the event the security is not issued, the commitment fee will be recorded as","page_number":122,"box":{"x":69,"y":370,"width":792,"height":11}},{"id":"b6282b1e-34ed-4202-90cd-9356bb834885","block_type":"box","text":"income on the expiration date of the standby commitment.","page_number":122,"box":{"x":70,"y":385,"width":415,"height":11}},{"id":"975315ce-ffb4-44e5-8e96-80e0a6286e7f","block_type":"box","text":"Standby commitments will only be entered into with dealers, banks and broker-dealers which, in the Manager’s","page_number":122,"box":{"x":102,"y":408,"width":789,"height":11}},{"id":"cbb4f035-4dbb-4456-a427-8f990501f746","block_type":"box","text":"or sub-adviser’s opinion, present minimal credit risks. A Fund will acquire standby commitments solely to facilitate","page_number":122,"box":{"x":69,"y":423,"width":814,"height":11}},{"id":"0576b456-cd96-4624-8696-3b072f61d270","block_type":"box","text":"por tfolio liquidity and not to exercise its rights thereunder for trading purposes. Standby commitments will be valued","page_number":122,"box":{"x":70,"y":438,"width":827,"height":11}},{"id":"e72b792a-2e96-42a4-ab53-fd32e2e113ed","block_type":"box","text":"at zero in determining NAV. Accordingly, where a Fund pays directly or indirectly for a standby commitment, its cost","page_number":122,"box":{"x":69,"y":453,"width":815,"height":11}},{"id":"0486d20c-a290-4fdd-ade0-bf6a9b0fe9ec","block_type":"box","text":"will be reflected as an unrealized loss for the period during which the commitment is held by such Fund and will be","page_number":122,"box":{"x":68,"y":468,"width":817,"height":11}},{"id":"caa81385-3305-4fbf-94d6-ea8cadfb245c","block_type":"box","text":"reflected as a realized gain or loss when the commitment is exercised or expires.","page_number":122,"box":{"x":69,"y":483,"width":578,"height":11}},{"id":"cb066941-6cbb-4a27-9fd5-664c184f9248","block_type":"box","text":"Stripped Securities.","page_number":122,"box":{"x":101,"y":506,"width":143,"height":11}},{"id":"725cfc3e-900b-419a-88c8-9b76c2bb14e5","block_type":"box","text":"Stripped securities are created when the issuer separates the interest and principal","page_number":122,"box":{"x":251,"y":506,"width":596,"height":11}},{"id":"5419169b-23a1-400f-9b36-c4266127dbe1","block_type":"box","text":"components of an instrument and sells them as separate securities. In general, one security is entitled to receive the","page_number":122,"box":{"x":69,"y":521,"width":839,"height":11}},{"id":"067c5cd5-43b7-4ec1-8f32-0472e5315ac4","block_type":"box","text":"interest payments on the underlying assets (the interest only or “IO” security) and the other to receive the principal","page_number":122,"box":{"x":70,"y":536,"width":818,"height":11}},{"id":"aa286aa3-1e0e-4c2b-a634-b30c6ea456ef","block_type":"box","text":"payments (the principal only or “PO” security). Some stripped securities may receive a combination of interest and","page_number":122,"box":{"x":70,"y":551,"width":813,"height":11}},{"id":"f49dd1f0-e5d5-462d-aae7-6b07dff901af","block_type":"box","text":"principal payments. The yields to maturity on IOs and POs are sensitive to the expected or anticipated rate of","page_number":122,"box":{"x":70,"y":566,"width":777,"height":11}},{"id":"eab4afc0-3fd2-4ec8-8f66-0781d3c99d64","block_type":"box","text":"principal payments (including prepayments) on the related underlying assets, and principal payments may have a","page_number":122,"box":{"x":70,"y":582,"width":802,"height":11}},{"id":"f30f70e3-7ac0-41b1-a802-ca0cf3f760a2","block_type":"box","text":"material effect on yield to maturity. If the underlying assets experience greater than anticipated prepayments of","page_number":122,"box":{"x":69,"y":596,"width":794,"height":12}},{"id":"00bc3e86-6f74-4e69-b2d3-49b44141333d","block_type":"box","text":"principal, a Fund may not fully recoup its initial investment in IOs. Conversely, if the underlying assets experience less","page_number":122,"box":{"x":70,"y":612,"width":837,"height":11}},{"id":"8d0c7a4e-ee9f-4b61-9d1e-6f763e154fb2","block_type":"box","text":"than anticipated prepayments of principal, the yield on POs could be adversely affected. Stripped securities may be","page_number":122,"box":{"x":68,"y":627,"width":823,"height":11}},{"id":"77b18374-e4d9-4ce2-b3b7-c001632658ba","block_type":"box","text":"highly sensitive to changes in interest rates and rates of prepayment.","page_number":122,"box":{"x":69,"y":642,"width":494,"height":11}},{"id":"d61ee40d-49f6-4640-a40c-053097681cc4","block_type":"box","text":"Structured Notes.","page_number":122,"box":{"x":101,"y":665,"width":130,"height":8}},{"id":"53f5b385-f0d9-4e5f-9bac-689aec56aa63","block_type":"box","text":"Structured notes and other related instruments purchased by a Fund are generally privately","page_number":122,"box":{"x":237,"y":665,"width":650,"height":11}},{"id":"4256ed35-fc7c-4815-be45-7380a6c9ee62","block_type":"box","text":"negotiated debt obligations where the principal and/or interest is determined by reference to the per formance of a","page_number":122,"box":{"x":69,"y":680,"width":818,"height":11}},{"id":"df1374b9-6d88-48ce-b1b2-b29aff920a67","block_type":"box","text":"specific asset, benchmark asset, market or interest rate (“reference measure”). Issuers of structured notes generally","page_number":122,"box":{"x":69,"y":695,"width":839,"height":11}},{"id":"663d6f78-8de2-476a-9445-796c30a9c0e4","block_type":"box","text":"include corporations and banks. The interest rate or the principal amount payable upon maturity or redemption may","page_number":122,"box":{"x":70,"y":710,"width":821,"height":11}},{"id":"896eb81b-bfb5-46d3-b93b-55dda5caf2bc","block_type":"box","text":"increase or decrease, depending upon changes in the value of the reference measure. The terms of a structured note","page_number":122,"box":{"x":70,"y":725,"width":839,"height":11}},{"id":"6ef82c5b-753f-428b-86f3-55d1b8f3a41f","block_type":"box","text":"may provide that, in cer tain circumstances, no principal is due at maturity and, therefore, may result in a loss of","page_number":122,"box":{"x":69,"y":740,"width":801,"height":11}},{"id":"27282808-0931-4932-8cec-612e7d8ac996","block_type":"box","text":"invested capital by a Fund. The interest and/or principal payments that may be made on a structured product may","page_number":122,"box":{"x":70,"y":755,"width":813,"height":11}},{"id":"31b7c1a7-e1b5-43b2-9907-1add8b4f6152","block_type":"box","text":"vary widely, depending on a variety of factors, including the volatility of the reference measure.","page_number":122,"box":{"x":68,"y":770,"width":673,"height":12}},{"id":"a4ddeb6e-8a02-479f-b594-4cd607132b71","block_type":"box","text":"Structured notes may be positively or negatively indexed, so the appreciation of the reference measure may","page_number":122,"box":{"x":102,"y":793,"width":768,"height":11}},{"id":"bc7cd76d-cab6-435e-af1a-00255c880671","block_type":"box","text":"produce an increase or a decrease in the interest rate or the value of the principal at maturity. The rate of return on","page_number":122,"box":{"x":70,"y":808,"width":821,"height":11}},{"id":"44e6f2ec-e957-4c67-b60c-129570f4e7bc","block_type":"box","text":"structured notes may be determined by applying a multiplier to the per formance or differential per formance of","page_number":122,"box":{"x":69,"y":823,"width":787,"height":12}},{"id":"51e534ce-8bfa-49b2-b546-e555f7945bf0","block_type":"box","text":"reference measures. Application of a multiplier involves leverage that will serve to magnify the potential for gain and","page_number":122,"box":{"x":69,"y":838,"width":827,"height":12}},{"id":"2df3169d-150d-4435-96b3-f16be6cf980c","block_type":"box","text":"the risk of loss.","page_number":122,"box":{"x":68,"y":853,"width":110,"height":9}},{"id":"2a97b8e0-d01d-496c-82c9-79826a24cc6e","block_type":"box","text":"The purchase of structured notes exposes a Fund to the credit risk of the issuer of the structured product.","page_number":122,"box":{"x":101,"y":876,"width":759,"height":11}},{"id":"eebf47a9-ec6e-4b99-8117-38f4dc7bb4ac","block_type":"box","text":"Structured notes may also be more volatile, less liquid, and more difficult to price accurately than less complex","page_number":122,"box":{"x":69,"y":891,"width":795,"height":11}},{"id":"1ef708c8-df81-49a4-80d0-4effb00b4ff7","block_type":"box","text":"securities and instruments or more traditional debt securities. The secondary market for structured notes could be","page_number":122,"box":{"x":69,"y":906,"width":819,"height":12}},{"id":"8b786c72-d17a-495f-8bba-b2953100b8c0","block_type":"box","text":"II-75","page_number":122,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"42849884-f6f7-4c64-ac70-f109f4295c1d","block_type":"box","text":"NM1026U-6033063-122/246","page_number":122,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"9410a6d9-87ed-402d-b9b2-e2c785ae4b61","block_type":"box","text":"illiquid making them difficult to sell when the Fund determines to sell them. The possible lack of a liquid secondary","page_number":123,"box":{"x":70,"y":45,"width":821,"height":11}},{"id":"8f9cf849-241e-42a0-8262-480e8dee456e","block_type":"box","text":"market for structured notes and the resulting inability of the Fund to sell a structured note could expose the Fund to","page_number":123,"box":{"x":69,"y":60,"width":827,"height":11}},{"id":"daa2cee5-2b90-465d-a224-1f508a3b5a88","block_type":"box","text":"losses and could make structured notes more difficult for the Fund to value accurately.","page_number":123,"box":{"x":70,"y":75,"width":618,"height":11}},{"id":"52fb8eb9-b5e3-458a-b59d-15f0ad499b7a","block_type":"box","text":"Taxability Risk.","page_number":123,"box":{"x":103,"y":98,"width":109,"height":11}},{"id":"1d9883af-69d6-4201-9639-45c8056feae0","block_type":"box","text":"Cer tain of the Funds intend to minimize the payment of taxable income to shareholders by","page_number":123,"box":{"x":218,"y":98,"width":644,"height":11}},{"id":"01f0a83d-a3f2-4bd7-ad3b-2d85affeea15","block_type":"box","text":"investing in tax-exempt or municipal securities in reliance at the time of purchase on an opinion of bond counsel to","page_number":123,"box":{"x":70,"y":113,"width":817,"height":11}},{"id":"ec9e2c90-9484-4b04-8780-4749a0c531d2","block_type":"box","text":"the issuer and, in the case of derivative securities, sponsors’ counsel, that the interest paid on those securities will","page_number":123,"box":{"x":68,"y":128,"width":827,"height":11}},{"id":"25b13347-3a18-42e2-8d62-634ef3582e84","block_type":"box","text":"be excludable from gross income for U.S. federal income tax purposes. Such securities, however, may be determined","page_number":123,"box":{"x":69,"y":143,"width":835,"height":11}},{"id":"cc6e2dbc-6f63-47c6-b03e-e095cf7dfa55","block_type":"box","text":"to pay, or have paid, taxable income subsequent to the Fund’s acquisition of the securities. In that event, the IRS","page_number":123,"box":{"x":68,"y":158,"width":809,"height":11}},{"id":"99b687c0-b6ce-44a1-9d9b-15dbff6a64cf","block_type":"box","text":"may demand that the Fund pay U.S. federal income taxes on the affected interest income, and, if the Fund agrees to","page_number":123,"box":{"x":69,"y":173,"width":832,"height":11}},{"id":"105dbc3a-f1c2-4e62-aae2-37e277fd199b","block_type":"box","text":"do so, the Fund’s yield could be adversely affected. In addition, the treatment of dividends previously paid or to be","page_number":123,"box":{"x":69,"y":188,"width":816,"height":11}},{"id":"48542193-1912-47ff-bd2d-c95c1d580318","block_type":"box","text":"paid by the Fund as “exempt interest dividends” could be adversely affected, subjecting the Fund’s shareholders to","page_number":123,"box":{"x":70,"y":203,"width":822,"height":12}},{"id":"95401aa4-537c-4357-8d6d-ea2b8de1bd11","block_type":"box","text":"increased U.S. federal income tax liabilities. If the interest paid on any tax-exempt or municipal security held by the","page_number":123,"box":{"x":70,"y":218,"width":818,"height":12}},{"id":"cd39580e-666d-4e37-8da1-86d62281bbbd","block_type":"box","text":"Fund is subsequently determined to be taxable, the Fund will dispose of that security as soon as reasonably","page_number":123,"box":{"x":70,"y":234,"width":771,"height":11}},{"id":"0b0d5989-6850-413d-8ac5-5c3555c34bcd","block_type":"box","text":"practicable. In addition, future laws, regulations, rulings or cour t decisions may cause interest on municipal","page_number":123,"box":{"x":70,"y":249,"width":765,"height":11}},{"id":"608ce319-05b3-444a-a1e0-9e04e6d63dbb","block_type":"box","text":"securities to be subject, directly or indirectly, to U.S. federal income taxation or interest on state municipal securities","page_number":123,"box":{"x":69,"y":264,"width":834,"height":11}},{"id":"cdf2af09-2482-4ea3-b9f6-948ebed4173c","block_type":"box","text":"to be subject to state or local income taxation, or the value of state municipal securities to be subject to state or","page_number":123,"box":{"x":68,"y":279,"width":807,"height":11}},{"id":"f1f1c8d3-8a38-447d-891a-18aa95af09c1","block_type":"box","text":"local intangible personal proper ty tax, or may otherwise prevent the Fund from realizing the full current benefit of the","page_number":123,"box":{"x":70,"y":294,"width":830,"height":11}},{"id":"b1c4b1a2-b829-4df9-b46c-15dec0fba354","block_type":"box","text":"tax-exempt status of such securities. Any such change could also affect the market price of such securities, and thus","page_number":123,"box":{"x":68,"y":309,"width":838,"height":11}},{"id":"4b970feb-754b-4d9f-acd3-2551dab43820","block_type":"box","text":"the value of an investment in the Fund.","page_number":123,"box":{"x":68,"y":324,"width":278,"height":9}},{"id":"e23ffbca-c905-4886-8006-2212dd8b9426","block_type":"box","text":"Temporary Defensive Measures.","page_number":123,"box":{"x":103,"y":347,"width":230,"height":11}},{"id":"aeae3c63-217c-480b-aa0e-76036157670c","block_type":"box","text":"As a temporary defensive measure, including to respond to adverse market,","page_number":123,"box":{"x":339,"y":347,"width":542,"height":11}},{"id":"d74e466c-369c-45e9-b756-587a5deee893","block_type":"box","text":"economic, political or other conditions, a Fund may depar t from its principal investment strategies and may invest","page_number":123,"box":{"x":69,"y":362,"width":811,"height":11}},{"id":"9bc68fa7-aabd-401a-9f0d-a36ce587595a","block_type":"box","text":"without limitation in cash, high quality money market instruments, or other shor t term investments. Cer tain Funds","page_number":123,"box":{"x":68,"y":377,"width":813,"height":12}},{"id":"b3c33e43-3d7b-4d8d-bf19-f5972de15573","block_type":"box","text":"may also invest in cash and other such instruments pending investment or to meet anticipated redemption requests.","page_number":123,"box":{"x":69,"y":393,"width":833,"height":11}},{"id":"ae1a3fe9-5119-4e98-8876-8867a302588f","block_type":"box","text":"High quality money market instruments include U.S. Government obligations, U.S. Government agency obligations,","page_number":123,"box":{"x":70,"y":408,"width":813,"height":11}},{"id":"49fb63c0-7470-4d3b-957c-8141ca2d8474","block_type":"box","text":"dollar denominated obligations of foreign issuers, bank obligations, including U.S. subsidiaries and branches of","page_number":123,"box":{"x":69,"y":423,"width":795,"height":11}},{"id":"6e2fc7f4-b5bf-4a6c-8d8c-d8a63c097240","block_type":"box","text":"foreign banks, corporate obligations, commercial paper, repurchase agreements and obligations of supranational","page_number":123,"box":{"x":68,"y":438,"width":806,"height":11}},{"id":"7e071ce5-af03-4b93-9e99-6f2732dadabd","block_type":"box","text":"organizations. Generally, such obligations will mature within one year from the date of settlement but may mature","page_number":123,"box":{"x":69,"y":453,"width":808,"height":11}},{"id":"cc7738fc-0b6c-482b-8ca9-66be7ab290dc","block_type":"box","text":"within two years from the date of settlement. Temporary defensive measures may affect a Fund’s ability to achieve","page_number":123,"box":{"x":68,"y":468,"width":820,"height":11}},{"id":"4337453c-2ec7-4488-a6bc-b475ddb84b44","block_type":"box","text":"its investment objective.","page_number":123,"box":{"x":70,"y":483,"width":171,"height":11}},{"id":"f3e30b5a-e308-41b2-8394-98a0e88c19a1","block_type":"box","text":"U.S. Government Obligations.","page_number":123,"box":{"x":102,"y":506,"width":213,"height":11}},{"id":"d08cf578-d51c-46b1-b2b0-477178bdf411","block_type":"box","text":"A Fund may purchase obligations issued or guaranteed by the U.S. Government","page_number":123,"box":{"x":321,"y":506,"width":566,"height":11}},{"id":"1ac7ac3f-f1ba-42e3-965a-67a9ea3415ef","block_type":"box","text":"and U.S. Government agencies and instrumentalities. Obligations of cer tain agencies and instrumentalities of the","page_number":123,"box":{"x":69,"y":521,"width":810,"height":11}},{"id":"17b57190-7fe9-4d2d-b93d-5e59dd658f41","block_type":"box","text":"U.S. Government are suppor ted by the full faith and credit of the U.S. Treasury. Others are suppor ted by the right of","page_number":123,"box":{"x":70,"y":536,"width":826,"height":11}},{"id":"0350929d-1a13-4dd1-afde-8e283bab280e","block_type":"box","text":"the issuer to borrow from the U.S. Treasury; and still others are suppor ted only by the credit of the agency or","page_number":123,"box":{"x":68,"y":551,"width":779,"height":11}},{"id":"7ce0dabd-d874-42db-ae7e-6c831008b26f","block_type":"box","text":"instrumentality issuing the obligation. No assurance can be given that the U.S. Government will provide financial","page_number":123,"box":{"x":70,"y":566,"width":798,"height":11}},{"id":"0f81483d-628b-4446-9d78-41bd4776202f","block_type":"box","text":"suppor t to U.S. Government-sponsored instrumentalities if it is not obligated to do so by law. Cer tain U.S. Treasury","page_number":123,"box":{"x":69,"y":581,"width":822,"height":12}},{"id":"5d2100eb-da93-4cc5-9391-e72def926658","block_type":"box","text":"and agency securities may be held by trusts that issue par ticipation cer tificates (such as Treasury income growth","page_number":123,"box":{"x":69,"y":596,"width":809,"height":12}},{"id":"00d0abe2-91f3-4c4e-9b6f-b9924ff45ac8","block_type":"box","text":"receipts and cer tificates of accrual on Treasury cer tificates). These cer tificates, as well as Treasury receipts and","page_number":123,"box":{"x":69,"y":612,"width":805,"height":11}},{"id":"60f15d87-904d-46cd-9ac3-bd966c18a1e4","block_type":"box","text":"other stripped securities, represent beneficial ownership interests in either future interest payments or the future","page_number":123,"box":{"x":69,"y":627,"width":807,"height":11}},{"id":"2a2abec2-2777-4def-9d37-0e030acbacf2","block_type":"box","text":"principal payments on U.S. Government obligations. These instruments are issued at a discount to their “face value”","page_number":123,"box":{"x":70,"y":642,"width":832,"height":11}},{"id":"1cf4852e-63f0-4932-aba9-826e2fc913cd","block_type":"box","text":"and may (par ticularly in the case of stripped mor tgage-backed securities) exhibit greater price volatility than ordinary","page_number":123,"box":{"x":69,"y":657,"width":829,"height":11}},{"id":"da17c0f5-108b-49f1-87f4-6d68b3e139db","block_type":"box","text":"debt securities because of the manner in which their principal and interest are returned to investors.","page_number":123,"box":{"x":69,"y":672,"width":716,"height":11}},{"id":"28ec6215-d2db-4fcb-a132-9eedd565aa75","block_type":"box","text":"Examples of the types of U.S. Government obligations that may be held by the Funds include U.S. Treasury Bills,","page_number":123,"box":{"x":102,"y":695,"width":800,"height":11}},{"id":"631af35a-a2c4-423e-8563-f69285d1936e","block_type":"box","text":"Treasury Notes and Treasury Bonds and the obligations of the Federal Housing Administration, Farmers Home","page_number":123,"box":{"x":68,"y":710,"width":785,"height":11}},{"id":"1257edec-150c-4041-bebf-2ed329591bfb","block_type":"box","text":"Administration, Expor t-Impor t Bank of the United States, Small Business Administration, Ginnie Mae, Fannie Mae,","page_number":123,"box":{"x":68,"y":725,"width":813,"height":11}},{"id":"1e5ec2bb-1ebe-40ad-b762-43818e2816f2","block_type":"box","text":"Federal Financing Bank, General Services Administration, Student Loan Marketing Association, Central Bank for","page_number":123,"box":{"x":70,"y":740,"width":794,"height":11}},{"id":"1a090bcc-27de-448b-bb67-22c662db2df3","block_type":"box","text":"Cooperatives, Federal Home Loan Banks, Freddie Mac, Federal Intermediate Credit Banks, Federal Land Banks, Farm","page_number":123,"box":{"x":69,"y":755,"width":835,"height":11}},{"id":"159d19fe-3e9d-44de-a288-f2484070eb3d","block_type":"box","text":"Credit Banks System, Maritime Administration, Tennessee Valley Authority and Washington D.C. Armory Board. The","page_number":123,"box":{"x":69,"y":770,"width":818,"height":12}},{"id":"ec6dfe0d-4853-4742-b1df-0372259efa54","block_type":"box","text":"Funds may also invest in mor tgage-related securities issued or guaranteed by U.S. Government agencies and","page_number":123,"box":{"x":70,"y":786,"width":777,"height":11}},{"id":"e2d34664-df08-4e76-9385-76e5c6f23634","block_type":"box","text":"instrumentalities, including such instruments as obligations of Ginnie Mae, Fannie Mae and Freddie Mac.","page_number":123,"box":{"x":70,"y":801,"width":749,"height":11}},{"id":"8e8c7341-057b-4a42-b5c3-bc33664801d9","block_type":"box","text":"U.S. Treasury Obligations.","page_number":123,"box":{"x":103,"y":823,"width":183,"height":12}},{"id":"2c264d91-a79c-4067-8817-fe98d8a26438","block_type":"box","text":"Treasury obligations may differ in their interest rates, maturities, times of issuance","page_number":123,"box":{"x":292,"y":823,"width":593,"height":12}},{"id":"01426da6-0ab4-40fa-99e8-01f71f4a9a9f","block_type":"box","text":"and other characteristics. Obligations of U.S. Government agencies and authorities are suppor ted by varying degrees","page_number":123,"box":{"x":69,"y":838,"width":835,"height":12}},{"id":"e679c2b4-b56f-47b8-b1bb-139a0a174f2e","block_type":"box","text":"of credit but generally are not backed by the full faith and credit of the U.S. Government. No assurance can be given","page_number":123,"box":{"x":69,"y":853,"width":827,"height":12}},{"id":"2312601d-ebe0-4244-9843-2bc27bf75f6e","block_type":"box","text":"that the U.S. Government will provide financial suppor t to its agencies and authorities if it is not obligated by law to","page_number":123,"box":{"x":68,"y":869,"width":823,"height":11}},{"id":"50c46bb2-a225-4dbc-a940-a4749a1114b9","block_type":"box","text":"do so.","page_number":123,"box":{"x":69,"y":884,"width":42,"height":9}},{"id":"216ae540-3ed0-41c4-9730-85995e2e382d","block_type":"box","text":"II-76","page_number":123,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"5ea5a26d-e94e-495f-9831-00c8f6391e23","block_type":"box","text":"NM1026U-6033063-123/246","page_number":123,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"3c6f2cd3-70bb-4f51-9191-1cba36ca0bbe","block_type":"box","text":"U.S. Treasury Rolls","page_number":124,"box":{"x":102,"y":45,"width":139,"height":11}},{"id":"4450dbea-12d7-4c3c-be03-3d2efd0987c4","block_type":"box","text":".","page_number":124,"box":{"x":241,"y":52,"width":3,"height":2}},{"id":"efad3014-00c2-4c5f-9338-06c6cba36381","block_type":"box","text":"Cer tain Funds may invest in U.S. Treasury rolls. In a U.S. Treasury roll transaction, the Fund","page_number":124,"box":{"x":250,"y":45,"width":656,"height":11}},{"id":"c1a8a860-b015-4dc0-aa70-0486c12b583d","block_type":"box","text":"sells a treasury security to a counterpar ty with a simultaneous agreement to repurchase the same security at an","page_number":124,"box":{"x":69,"y":60,"width":804,"height":11}},{"id":"efb7afa9-096e-47a1-a146-8380ecc8666c","block_type":"box","text":"agreed upon price and future settlement date. U.S. Treasury roll transactions may incrementally adjust the average","page_number":124,"box":{"x":69,"y":75,"width":820,"height":11}},{"id":"fd728e4f-dd7d-4c98-a447-c860fec8d214","block_type":"box","text":"maturity of a Fund’s por tfolio and increase the interest yield on the Fund’s por tfolio by extending the average maturity","page_number":124,"box":{"x":69,"y":90,"width":840,"height":11}},{"id":"7b79547e-c802-47e4-9e9d-11aedba5a5ad","block_type":"box","text":"of the por tfolio in a normal yield curve environment. During the period before the settlement date of a U.S. Treasury","page_number":124,"box":{"x":69,"y":105,"width":828,"height":11}},{"id":"ca817dfc-fc55-4dd7-88d2-1b54f90baa71","block_type":"box","text":"roll, a Fund continues to earn interest on the securities it is selling; however, it does not earn interest on the","page_number":124,"box":{"x":69,"y":120,"width":775,"height":12}},{"id":"9394c7b6-2928-4a3b-9a47-cb53221a0800","block_type":"box","text":"securities it is purchasing until after the settlement date. A Fund could suffer an oppor tunity loss if the counterpar ty","page_number":124,"box":{"x":69,"y":135,"width":829,"height":12}},{"id":"5b4cc567-24f5-481c-be25-fd53662ef768","block_type":"box","text":"to the U.S. Treasury roll transaction failed to per form its obligations on the settlement date.","page_number":124,"box":{"x":68,"y":150,"width":657,"height":12}},{"id":"8d447478-6201-4277-9424-91fed9031025","block_type":"box","text":"The market value of the securities that a Fund is required to purchase may decline below the agreed upon","page_number":124,"box":{"x":101,"y":173,"width":756,"height":11}},{"id":"5456c2d5-3c74-49ec-b698-c6c264090277","block_type":"box","text":"purchase price of those securities. U.S. Treasury rolls are speculative techniques that can be deemed to involve","page_number":124,"box":{"x":70,"y":188,"width":800,"height":11}},{"id":"0b30672d-0d66-4ca7-a4d8-cfecb78d0ebc","block_type":"box","text":"leverage. There is no assurance that U.S. Treasury rolls can be successfully employed.","page_number":124,"box":{"x":70,"y":203,"width":617,"height":12}},{"id":"488196ca-e873-40b7-b04d-6b843fa98329","block_type":"box","text":"Utility Industries.","page_number":124,"box":{"x":102,"y":226,"width":124,"height":11}},{"id":"6716046f-1384-450b-a59d-762d823206d1","block_type":"box","text":"Risks that are intrinsic to the utility industries include difficulty in obtaining an adequate return","page_number":124,"box":{"x":233,"y":226,"width":674,"height":11}},{"id":"b15ff99f-1741-4f91-b4ca-22136faa1e32","block_type":"box","text":"on invested capital, difficulty in financing large construction programs during an inflationary period, restrictions on","page_number":124,"box":{"x":69,"y":241,"width":812,"height":11}},{"id":"e8fdc040-0462-4b66-800a-585a6a01c9fd","block_type":"box","text":"operations and increased cost and delays attributable to environmental considerations and regulation, difficulty in","page_number":124,"box":{"x":69,"y":256,"width":812,"height":12}},{"id":"3dc611eb-f1b5-4fd8-99aa-d4b913d9b97d","block_type":"box","text":"raising capital in adequate amounts on reasonable terms in periods of high inflation and unsettled capital markets,","page_number":124,"box":{"x":69,"y":271,"width":821,"height":12}},{"id":"e03a68ad-50cc-425b-b2b8-4b9f9735c1ec","block_type":"box","text":"technological innovations that may render existing plants, equipment or products obsolete, the potential impact of","page_number":124,"box":{"x":68,"y":286,"width":815,"height":12}},{"id":"eeb1f827-13b7-4b86-a4f2-df38c864f9a6","block_type":"box","text":"natural or man-made disasters, increased costs and reduced availability of cer tain types of fuel, occasional reduced","page_number":124,"box":{"x":69,"y":302,"width":827,"height":11}},{"id":"17b89bbb-111d-4aa6-9234-677584faf654","block_type":"box","text":"availability and high costs of natural gas for resale, the effects of energy conservation, the effects of a national","page_number":124,"box":{"x":69,"y":317,"width":795,"height":11}},{"id":"9253ea17-8493-4306-bc20-6cf1924d51fc","block_type":"box","text":"energy policy and lengthy delays and greatly increased costs and other problems associated with the design,","page_number":124,"box":{"x":69,"y":332,"width":774,"height":11}},{"id":"d1194e76-bfbb-4eac-b464-0f58942efba3","block_type":"box","text":"construction, licensing, regulation and operation of nuclear facilities for electric generation, including, among other","page_number":124,"box":{"x":69,"y":347,"width":817,"height":11}},{"id":"36891e8c-5684-4b36-9527-e15c28199b83","block_type":"box","text":"considerations, the problems associated with the use of radioactive materials and the disposal of radioactive wastes.","page_number":124,"box":{"x":69,"y":362,"width":839,"height":11}},{"id":"934bc4a6-bcb5-48f2-b6eb-c0ae2cafba0b","block_type":"box","text":"There are substantial differences among the regulatory practices and policies of various jurisdictions, and any given","page_number":124,"box":{"x":68,"y":377,"width":827,"height":12}},{"id":"4cca3b43-a93e-4195-b542-fdbfec47fd17","block_type":"box","text":"regulatory agency may make major shifts in policy from time to time. There is no assurance that regulatory","page_number":124,"box":{"x":69,"y":392,"width":761,"height":12}},{"id":"0057ad5f-a71d-4c43-b12e-0af111c591f1","block_type":"box","text":"authorities will, in the future, grant rate increases or that such increases will be adequate to permit the payment of","page_number":124,"box":{"x":69,"y":407,"width":821,"height":12}},{"id":"10f46f36-93fc-4792-8d0d-c3177664d59a","block_type":"box","text":"dividends on common stocks issued by a utility company. Additionally, existing and possible future regulatory","page_number":124,"box":{"x":69,"y":423,"width":777,"height":11}},{"id":"0f5627a8-c5b6-41ed-a10f-b52899e426dd","block_type":"box","text":"legislation may make it even more difficult for utilities to obtain adequate relief. Cer tain of the issuers of securities","page_number":124,"box":{"x":70,"y":438,"width":820,"height":11}},{"id":"587b968b-5363-4359-b5ff-faaa464a291d","block_type":"box","text":"held in the Fund’s por tfolio may own or operate nuclear generating facilities. Governmental authorities may from time","page_number":124,"box":{"x":69,"y":453,"width":835,"height":11}},{"id":"b8738a23-8f97-42af-af68-6100ae70484c","block_type":"box","text":"to time review existing policies and impose additional requirements governing the licensing, construction and","page_number":124,"box":{"x":68,"y":468,"width":778,"height":11}},{"id":"b8469002-836b-46d0-a982-580c61baef1a","block_type":"box","text":"operation of nuclear power plants. Prolonged changes in climatic conditions can also have a significant impact on","page_number":124,"box":{"x":69,"y":483,"width":808,"height":11}},{"id":"cda43432-0308-4eb4-bdc5-d118b49dd813","block_type":"box","text":"both the revenues of an electric and gas utility as well as the expenses of a utility, par ticularly a hydro-based electric","page_number":124,"box":{"x":69,"y":498,"width":831,"height":11}},{"id":"e780d84f-e763-436e-9c72-07c1fc17aed4","block_type":"box","text":"utility.","page_number":124,"box":{"x":69,"y":514,"width":39,"height":10}},{"id":"c9ca2a47-b732-4b66-866d-71639350012a","block_type":"box","text":"Companies in the utilities sector may be adversely affected by changes in exchange rates, domestic and","page_number":124,"box":{"x":102,"y":536,"width":744,"height":11}},{"id":"0c696704-aa0c-43dd-b853-ac8330a83657","block_type":"box","text":"international competition, and governmental limitations on rates charged to customers. The value of regulated utility","page_number":124,"box":{"x":70,"y":551,"width":828,"height":11}},{"id":"474b2508-883a-4def-bd03-a41eff1d108f","block_type":"box","text":"debt securities and, to a lesser extent, equity securities, tends to have an inverse relationship to the movement of","page_number":124,"box":{"x":69,"y":566,"width":817,"height":11}},{"id":"31793ee4-8223-480f-a956-8a77e758e595","block_type":"box","text":"interest rates and therefore may lead to volatility in per formance.","page_number":124,"box":{"x":70,"y":581,"width":464,"height":11}},{"id":"4ad925ee-8f03-49b3-9d12-284bcf52d865","block_type":"box","text":"Utility companies in the United States and in foreign countries are generally subject to regulation. In the United","page_number":124,"box":{"x":102,"y":604,"width":789,"height":11}},{"id":"cdbe808c-7131-4ca9-a17d-f27a35ced3b8","block_type":"box","text":"States, most utility companies are regulated by state and/or federal authorities. Such regulation is intended to","page_number":124,"box":{"x":69,"y":619,"width":790,"height":11}},{"id":"3941d677-d947-4589-ba4d-c7440b240cb7","block_type":"box","text":"ensure appropriate standards of service and adequate capacity to meet public demand. Generally, prices are also","page_number":124,"box":{"x":69,"y":634,"width":811,"height":11}},{"id":"6236a400-494c-4eda-a6dc-d9a8f461d3d4","block_type":"box","text":"regulated in the United States and in foreign countries with the intention of protecting the public while ensuring that","page_number":124,"box":{"x":69,"y":649,"width":824,"height":12}},{"id":"11622999-ea64-4d3c-851c-dadaf11822e1","block_type":"box","text":"the rate of return earned by utility companies is sufficient to allow them to attract capital in order to grow and","page_number":124,"box":{"x":68,"y":664,"width":781,"height":12}},{"id":"28b670c0-0e51-4bc1-bbdd-ee135d72edfd","block_type":"box","text":"continue to provide appropriate services. There can be no assurance that such pricing policies or rates of return will","page_number":124,"box":{"x":69,"y":680,"width":826,"height":11}},{"id":"1b304996-31a1-4535-b863-c5fea4988e22","block_type":"box","text":"continue in the future.","page_number":124,"box":{"x":69,"y":695,"width":156,"height":9}},{"id":"f19ee0eb-e0cf-4e7a-aff2-bcb921f70916","block_type":"box","text":"The nature of regulation of the utility industries continues to evolve both in the United States and in foreign","page_number":124,"box":{"x":101,"y":717,"width":763,"height":12}},{"id":"438d4243-c8a5-4d72-b67e-f226bcdebdf9","block_type":"box","text":"countries. In recent years, changes in regulation in the United States increasingly have allowed utility companies to","page_number":124,"box":{"x":69,"y":733,"width":820,"height":11}},{"id":"b6fc8615-fbc8-4fa2-b2ca-177f9954dd49","block_type":"box","text":"provide services and products outside their traditional geographic areas and lines of business, creating new areas of","page_number":124,"box":{"x":70,"y":748,"width":834,"height":11}},{"id":"08989091-3ba1-4664-bdba-adb424f95166","block_type":"box","text":"competition within the industries. In some instances, utility companies are operating on an unregulated basis.","page_number":124,"box":{"x":69,"y":763,"width":784,"height":11}},{"id":"fe9b3d5f-1a8c-4858-9a71-0061220f8a2b","block_type":"box","text":"Because of trends toward deregulation and the evolution of independent power producers as well as new entrants to","page_number":124,"box":{"x":70,"y":778,"width":830,"height":11}},{"id":"335e41b5-dd87-4dc0-b369-dfd0e4c8b1dd","block_type":"box","text":"the field of telecommunications, non-regulated providers of utility services have become a significant par t of their","page_number":124,"box":{"x":68,"y":793,"width":809,"height":11}},{"id":"7a0d73b3-10af-411e-8530-efff19f45883","block_type":"box","text":"respective industries. The Manager believes that the emergence of competition and deregulation will result in cer tain","page_number":124,"box":{"x":69,"y":808,"width":834,"height":11}},{"id":"a4bea351-2ac0-490c-a961-5678b8e986f4","block_type":"box","text":"utility companies being able to earn more than their traditional regulated rates of return, while others may be forced","page_number":124,"box":{"x":69,"y":823,"width":825,"height":12}},{"id":"c93ba26d-c24f-4c84-8498-73bf49192fae","block_type":"box","text":"to defend their core business from increased competition and may be less profitable. Reduced profitability, as well as","page_number":124,"box":{"x":68,"y":838,"width":840,"height":11}},{"id":"40bf529b-adc0-4888-aafa-acefd64017d5","block_type":"box","text":"new uses of funds (such as for expansion, operations or stock buybacks) could result in cuts in dividend payout","page_number":124,"box":{"x":69,"y":853,"width":796,"height":12}},{"id":"20f57207-d460-4893-b8fa-252725c004cb","block_type":"box","text":"rates. As deregulation allows utility companies to diversify outside of their original geographic regions and their","page_number":124,"box":{"x":69,"y":869,"width":790,"height":11}},{"id":"3187f346-f298-4fd4-bc34-863499730e9a","block_type":"box","text":"traditional lines of business, utility companies may engage in riskier ventures. Therefore, deregulation may eliminate","page_number":124,"box":{"x":68,"y":884,"width":831,"height":11}},{"id":"c88916e9-d543-4e84-b5fa-3ff16a299cdf","block_type":"box","text":"restrictions on the maximum level of profits of cer tain utility companies, but may also subject these companies to","page_number":124,"box":{"x":69,"y":899,"width":812,"height":11}},{"id":"fd5d8b97-41a8-463f-9d15-d154145d452f","block_type":"box","text":"II-77","page_number":124,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"d7662089-b1cb-49b0-ab6a-98406c9da84f","block_type":"box","text":"NM1026U-6033063-124/246","page_number":124,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"7921bf80-3f56-45bc-b994-997030db8c00","block_type":"box","text":"greater risk of loss. The Manager seeks to take advantage of favorable investment oppor tunities that may arise from","page_number":125,"box":{"x":68,"y":45,"width":833,"height":11}},{"id":"d2caf683-098d-4284-8297-beb53081f5d4","block_type":"box","text":"these structural changes. Of course, there can be no assurance that favorable developments will occur in the future.","page_number":125,"box":{"x":68,"y":60,"width":831,"height":11}},{"id":"1f290ac7-f5e8-4bda-8792-5179bcbc2d68","block_type":"box","text":"Foreign utility companies are also subject to regulation, although such regulations may or may not be","page_number":125,"box":{"x":102,"y":83,"width":720,"height":11}},{"id":"14f025d4-e995-422b-ad60-c12a05f2d6d4","block_type":"box","text":"comparable to those in the United States. Foreign utility companies may be more heavily regulated by their respective","page_number":125,"box":{"x":69,"y":98,"width":838,"height":11}},{"id":"0229d949-bd7a-45c7-bb0c-120e10e9c650","block_type":"box","text":"governments than utilities in the United States and, as in the United States, generally are required to seek","page_number":125,"box":{"x":68,"y":113,"width":762,"height":11}},{"id":"289ea9ef-b886-43d9-b5a4-636e45546589","block_type":"box","text":"government approval for rate increases. In addition, many foreign utilities use fuels that may cause more pollution","page_number":125,"box":{"x":68,"y":128,"width":815,"height":11}},{"id":"bd46af88-d0c2-4c6c-b66a-dd5de33b5aa0","block_type":"box","text":"than those used in the United States, which may require such utilities to invest in pollution control equipment to","page_number":125,"box":{"x":68,"y":143,"width":801,"height":11}},{"id":"176ba52e-b295-410d-baea-be866e4f759b","block_type":"box","text":"meet any proposed pollution restrictions. Foreign regulatory systems vary from country to country and may evolve in","page_number":125,"box":{"x":69,"y":158,"width":828,"height":11}},{"id":"80a86cfd-c9c8-442d-a97d-6897f7fdbb94","block_type":"box","text":"ways different from regulation in the United States.","page_number":125,"box":{"x":68,"y":173,"width":365,"height":11}},{"id":"0761956d-49f2-4770-9734-2d49033446b7","block_type":"box","text":"A Fund’s investment policies are designed to enable it to capitalize on evolving investment oppor tunities","page_number":125,"box":{"x":101,"y":196,"width":745,"height":11}},{"id":"1321110a-ab9d-4418-890a-0b5fbe809b40","block_type":"box","text":"throughout the world. For example, the rapid growth of cer tain foreign economies will necessitate expansion of","page_number":125,"box":{"x":68,"y":211,"width":790,"height":11}},{"id":"ca8bca4f-af32-43e8-b6eb-0b9cffc5abb3","block_type":"box","text":"capacity in the utility industries in those countries. Although many foreign utility companies currently are government","page_number":125,"box":{"x":69,"y":226,"width":833,"height":11}},{"id":"65a8fd79-2619-4baa-abe4-ba4cabff1305","block_type":"box","text":"owned, thereby limiting current investment oppor tunities for a Fund, the Manager believes that, in order to attract","page_number":125,"box":{"x":69,"y":241,"width":810,"height":11}},{"id":"9b28ddc7-e04a-47ba-a312-635a51c821eb","block_type":"box","text":"significant capital for growth, foreign governments are likely to seek global investors through the privatization of their","page_number":125,"box":{"x":69,"y":256,"width":831,"height":12}},{"id":"88d2e214-92dc-44c5-8b00-48f60ef4c4bf","block_type":"box","text":"utility industries. Privatization, which refers to the trend toward investor ownership of assets rather than government","page_number":125,"box":{"x":69,"y":271,"width":828,"height":12}},{"id":"556b987e-326d-42fa-887d-7af8b99d09cd","block_type":"box","text":"ownership, is expected to occur in newer, faster-growing economies and in mature economies. Of course, there is no","page_number":125,"box":{"x":69,"y":286,"width":832,"height":12}},{"id":"a0577b2d-b759-4251-84e4-eb0e0871ec48","block_type":"box","text":"assurance that such favorable developments will occur or that investment oppor tunities in foreign markets will","page_number":125,"box":{"x":69,"y":302,"width":786,"height":11}},{"id":"2e507bc6-6a2e-430e-a87b-e442830fc310","block_type":"box","text":"increase.","page_number":125,"box":{"x":70,"y":317,"width":63,"height":9}},{"id":"d24c2844-c64e-4044-8b63-1cc29b5db8cd","block_type":"box","text":"The revenues of domestic and foreign utility companies generally reflect the economic growth and development","page_number":125,"box":{"x":101,"y":339,"width":793,"height":12}},{"id":"cf37b6a0-573d-48eb-8e2f-7c3d3027a62e","block_type":"box","text":"in the geographic areas in which they do business. The Manager will take into account anticipated economic growth","page_number":125,"box":{"x":70,"y":355,"width":821,"height":11}},{"id":"ec7f1924-5e6e-4e57-a180-a0a1304ecc37","block_type":"box","text":"rates and other economic developments when selecting securities of utility companies.","page_number":125,"box":{"x":69,"y":370,"width":619,"height":11}},{"id":"08a8db2a-1ce3-43dc-bf2c-ba9c883a7aa2","block_type":"box","text":"Electric.","page_number":125,"box":{"x":102,"y":393,"width":54,"height":8}},{"id":"ca0f042e-f746-49f4-b246-29c98fd11d4a","block_type":"box","text":"The electric utility industry consists of companies that are engaged principally in the generation,","page_number":125,"box":{"x":163,"y":392,"width":684,"height":12}},{"id":"124936ff-8605-4a68-8c10-a1c91f13fe92","block_type":"box","text":"transmission and sale of electric energy, although many also provide other energy-related services. In the past,","page_number":125,"box":{"x":68,"y":407,"width":793,"height":12}},{"id":"88ee2a4a-af47-45d1-a487-ddbf549207f4","block_type":"box","text":"electric utility companies, in general, have been favorably affected by lower fuel and financing costs and the full or","page_number":125,"box":{"x":69,"y":423,"width":814,"height":11}},{"id":"8cb8aa46-3047-4d4a-b6c1-705a7883ebbb","block_type":"box","text":"near completion of major construction programs. In addition, many of these companies have generated cash flows in","page_number":125,"box":{"x":69,"y":438,"width":833,"height":11}},{"id":"8b35b692-c96e-43e4-b9bc-c0e4d43e3dd3","block_type":"box","text":"excess of current operating expenses and construction expenditures, permitting some degree of diversification into","page_number":125,"box":{"x":69,"y":453,"width":821,"height":11}},{"id":"ddf17edf-4456-452e-bc72-67aeb898d175","block_type":"box","text":"unregulated businesses. Some electric utilities have also taken advantage of the right to sell power outside of their","page_number":125,"box":{"x":69,"y":468,"width":823,"height":11}},{"id":"0e8f0310-0d7d-4f75-b74e-fbde6303e0ef","block_type":"box","text":"traditional geographic areas. Electric utility companies have historically been subject to the risks associated with","page_number":125,"box":{"x":68,"y":483,"width":803,"height":11}},{"id":"17a30cfb-0c9b-4b12-8306-1f8cd3d6a164","block_type":"box","text":"increases in fuel and other operating costs, high interest costs on borrowings needed for capital construction","page_number":125,"box":{"x":70,"y":498,"width":778,"height":11}},{"id":"3bc610a4-a709-4a32-ab45-3c954679c823","block_type":"box","text":"programs, costs associated with compliance with environmental and safety regulations and changes in the regulatory","page_number":125,"box":{"x":70,"y":513,"width":836,"height":12}},{"id":"f9e4f96d-5f2f-47be-b6b3-0932474822e1","block_type":"box","text":"climate. As interest rates declined, many utilities refinanced high cost debt and in doing so improved their fixed","page_number":125,"box":{"x":69,"y":528,"width":793,"height":12}},{"id":"153d047b-3252-420e-be87-235436928699","block_type":"box","text":"charges coverage. Regulators, however, lowered allowed rates of return as interest rates declined and thereby","page_number":125,"box":{"x":69,"y":543,"width":786,"height":12}},{"id":"2933382b-6885-4929-ba35-b17ccf7507bb","block_type":"box","text":"caused the benefits of the rate declines to be shared wholly or in par t with customers. In a period of rising interest","page_number":125,"box":{"x":69,"y":559,"width":819,"height":11}},{"id":"5a9930ad-af5d-4208-9bd3-acad50ad0025","block_type":"box","text":"rates, the allowed rates of return may not keep pace with the utilities’ increased costs. The construction and","page_number":125,"box":{"x":69,"y":574,"width":775,"height":11}},{"id":"ecdf6e91-4740-40b0-82d6-7e149d9755ab","block_type":"box","text":"operation of nuclear power facilities are subject to strict scrutiny by, and evolving regulations of, the Nuclear","page_number":125,"box":{"x":69,"y":589,"width":770,"height":11}},{"id":"0df9b687-5c85-48c6-bf82-b27c0423134a","block_type":"box","text":"Regulatory Commission and state agencies which have comparable jurisdiction. Strict scrutiny might result in higher","page_number":125,"box":{"x":70,"y":604,"width":826,"height":11}},{"id":"62565530-63bf-4788-9aaf-f12241a19aac","block_type":"box","text":"operating costs and higher capital expenditures, with the risk that the regulators may disallow inclusion of these","page_number":125,"box":{"x":69,"y":619,"width":800,"height":11}},{"id":"728b6996-e480-461c-8f08-a042cce3e988","block_type":"box","text":"costs in rate authorizations or the risk that a company may not be permitted to operate or complete construction of a","page_number":125,"box":{"x":69,"y":634,"width":836,"height":11}},{"id":"28dd64f1-3397-499f-8913-d8fe3223a6c5","block_type":"box","text":"facility. In addition, operators of nuclear power plants may be subject to significant costs for disposal of nuclear fuel","page_number":125,"box":{"x":68,"y":649,"width":826,"height":12}},{"id":"83929444-2df1-4a95-be8b-9edab685ceea","block_type":"box","text":"and for decommissioning such plants.","page_number":125,"box":{"x":69,"y":664,"width":270,"height":12}},{"id":"254b8149-f647-48c3-b7f4-bd7446b5dd30","block_type":"box","text":"The rating agencies look closely at the business profile of utilities. Ratings for companies are expected to be","page_number":125,"box":{"x":101,"y":687,"width":776,"height":11}},{"id":"f1ab8d55-fe61-432c-b64b-b88bac892b6d","block_type":"box","text":"impacted to a greater extent in the future by the division of their asset base. Electric utility companies that focus","page_number":125,"box":{"x":70,"y":702,"width":802,"height":12}},{"id":"2a0e4ac3-7cd0-4adb-aa6c-d50c3ffaeab5","block_type":"box","text":"more on the generation of electricity may be assigned less favorable ratings as this business is expected to be","page_number":125,"box":{"x":69,"y":717,"width":791,"height":12}},{"id":"411c7729-d2cb-4ce5-b557-c03bd11b04ee","block_type":"box","text":"competitive and the least regulated. On the other hand, companies that focus on transmission and distribution, which","page_number":125,"box":{"x":69,"y":732,"width":839,"height":12}},{"id":"433012b1-491e-4a85-8200-392cd6082a15","block_type":"box","text":"is expected to be the least competitive and the more regulated par t of the business, may see higher ratings given the","page_number":125,"box":{"x":70,"y":748,"width":838,"height":11}},{"id":"33316639-a9ba-435e-80fc-8f8aec4c68a3","block_type":"box","text":"greater predictability of cash flow.","page_number":125,"box":{"x":68,"y":763,"width":239,"height":11}},{"id":"6a2d8ae1-9da8-4d1e-be99-676476a03991","block_type":"box","text":"A number of states are considering or have enacted deregulation proposals. The introduction of competition into","page_number":125,"box":{"x":101,"y":785,"width":801,"height":12}},{"id":"3ed82b79-2173-4d38-a72c-ccb2339b8c5d","block_type":"box","text":"the industry as a result of such deregulation has at times resulted in lower revenue, lower credit ratings, increased","page_number":125,"box":{"x":68,"y":801,"width":821,"height":11}},{"id":"3a5b24c9-8b7b-4dfb-8c8b-f7bcc8e9835c","block_type":"box","text":"default risk, and lower electric utility security prices. Such increased competition may also cause long-term contracts,","page_number":125,"box":{"x":69,"y":816,"width":835,"height":11}},{"id":"baac2755-285c-4b4c-a041-ddb760d30353","block_type":"box","text":"which electric utilities previously entered into to buy power, to become “stranded assets” which have no economic","page_number":125,"box":{"x":68,"y":831,"width":815,"height":11}},{"id":"ed7ad611-2a77-4c84-8ce2-50c7fd1ddd98","block_type":"box","text":"value. Any loss associated with such contracts must be absorbed by ratepayers and investors. In addition, some","page_number":125,"box":{"x":68,"y":846,"width":803,"height":11}},{"id":"28fda2a3-82dd-4b35-81e2-5e773b575c9a","block_type":"box","text":"electric utilities have acquired electric utilities overseas to diversify, enhance earnings and gain experience in","page_number":125,"box":{"x":69,"y":861,"width":777,"height":11}},{"id":"6157c1e9-d6b8-4bec-bd0d-964912b10e51","block_type":"box","text":"operating in a deregulated environment. In some instances, such acquisitions have involved significant borrowings,","page_number":125,"box":{"x":69,"y":876,"width":819,"height":11}},{"id":"cf982715-4a04-4ccd-a0e4-9223ee1a4e59","block_type":"box","text":"which have burdened the acquirer’s balance sheet. There is no assurance that current deregulation proposals will be","page_number":125,"box":{"x":68,"y":891,"width":835,"height":12}},{"id":"94d52a25-fa82-47ad-afb9-5277f750a08e","block_type":"box","text":"adopted. However, deregulation in any form could significantly impact the electric utilities industry.","page_number":125,"box":{"x":69,"y":906,"width":700,"height":12}},{"id":"72aadee8-6379-4126-8d8b-2df8d8ac3b96","block_type":"box","text":"II-78","page_number":125,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"43d7bf0d-5daf-40de-aa7b-8a063d4e2351","block_type":"box","text":"NM1026U-6033063-125/246","page_number":125,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"9cfc8cea-cd1a-4da7-af9b-ff2023f490f9","block_type":"box","text":"Telecommunications.","page_number":126,"box":{"x":103,"y":45,"width":147,"height":9}},{"id":"30e01e05-709c-4a4a-b3ea-0695e1808fa7","block_type":"box","text":"The telecommunications industry today includes both traditional telephone companies, with","page_number":126,"box":{"x":256,"y":45,"width":652,"height":11}},{"id":"4b963ef6-1351-47f2-8554-98b10dd8bf73","block_type":"box","text":"a history of broad market coverage and highly regulated businesses, and cable companies, which began as small,","page_number":126,"box":{"x":69,"y":60,"width":813,"height":11}},{"id":"8c6b99ef-3e3f-4a16-b3a4-18bafada7068","block_type":"box","text":"lightly regulated businesses focused on limited markets. Today these two historically different businesses are","page_number":126,"box":{"x":70,"y":75,"width":782,"height":11}},{"id":"be54131b-9f6c-44b8-aa6f-2e1f6028aa10","block_type":"box","text":"converging in an industry that is trending toward larger, competitive national and international markets with an","page_number":126,"box":{"x":69,"y":90,"width":786,"height":11}},{"id":"ac684fc7-863b-475a-b571-2dafd75fd659","block_type":"box","text":"emphasis on deregulation. Companies that distribute telephone services and provide access to the telephone","page_number":126,"box":{"x":69,"y":105,"width":784,"height":11}},{"id":"c04b846b-461a-4e0c-9602-483416b6bca6","block_type":"box","text":"networks still comprise the greatest por tion of this segment, but non-regulated activities such as wireless telephone","page_number":126,"box":{"x":69,"y":120,"width":830,"height":12}},{"id":"7dee3b4b-b27a-4a37-98a5-646fc3daec64","block_type":"box","text":"services, paging, data transmission and processing, equipment retailing, computer software and hardware and","page_number":126,"box":{"x":69,"y":135,"width":790,"height":12}},{"id":"cbdab2be-c065-4f5b-a1bf-48d15602385b","block_type":"box","text":"internet services are becoming increasingly significant components as well. In par ticular, wireless and internet","page_number":126,"box":{"x":70,"y":150,"width":788,"height":12}},{"id":"f6b2b073-2f94-4921-b013-4218cf1316ff","block_type":"box","text":"telephone services continue to gain market share at the expense of traditional telephone companies. The presence","page_number":126,"box":{"x":68,"y":166,"width":825,"height":11}},{"id":"b50c141e-e638-422f-aa75-666c0bd70f80","block_type":"box","text":"of unregulated companies in this industry and the entry of traditional telephone companies into unregulated or less","page_number":126,"box":{"x":69,"y":181,"width":823,"height":11}},{"id":"34314285-23bb-439f-8860-f2c6b8a9b6bf","block_type":"box","text":"regulated businesses provide significant investment oppor tunities with companies that may increase their earnings","page_number":126,"box":{"x":69,"y":196,"width":821,"height":11}},{"id":"2f9d206d-143f-45bc-867a-d51e0def7b15","block_type":"box","text":"at faster rates than had been allowed in traditional regulated businesses. Still, increasing competition, technological","page_number":126,"box":{"x":69,"y":211,"width":830,"height":11}},{"id":"8dcd3b24-c380-4b78-b75f-f836c0079dab","block_type":"box","text":"innovations and other structural changes could adversely affect the profitability of such utilities and the growth rate","page_number":126,"box":{"x":70,"y":226,"width":821,"height":11}},{"id":"238bcaf5-15c8-4127-99b8-c5b1e9d5191c","block_type":"box","text":"of their dividends. Given mergers and proposed legislation and enforcement changes, it is likely that both traditional","page_number":126,"box":{"x":69,"y":241,"width":827,"height":11}},{"id":"383e59d4-0a67-4f47-bc89-5bc8576417e3","block_type":"box","text":"telephone companies and cable companies will continue to provide an expanding range of utility services to both","page_number":126,"box":{"x":68,"y":256,"width":804,"height":12}},{"id":"6ae7bea8-954e-4c64-87b4-400999ed2d62","block_type":"box","text":"residential, corporate and governmental customers.","page_number":126,"box":{"x":69,"y":272,"width":367,"height":11}},{"id":"c4dfbb47-3899-48f2-a141-e1a8e6992785","block_type":"box","text":"Gas.","page_number":126,"box":{"x":102,"y":294,"width":31,"height":9}},{"id":"8c4ac296-23a5-488a-9637-c034f8d3be73","block_type":"box","text":"Gas transmission companies and gas distribution companies are undergoing significant changes. In the","page_number":126,"box":{"x":139,"y":294,"width":740,"height":11}},{"id":"6c7bd35d-1925-4616-9211-eac0624ca5a1","block_type":"box","text":"United States, interstate transmission companies are regulated by the Federal Energy Regulatory Commission, which","page_number":126,"box":{"x":70,"y":309,"width":834,"height":11}},{"id":"db864eee-1717-4f14-bad9-7a8c5e7ef4dc","block_type":"box","text":"is reducing its regulation of the industry. Many companies have diversified into oil and gas exploration and","page_number":126,"box":{"x":70,"y":324,"width":756,"height":12}},{"id":"ca94f54c-989b-4481-83f7-0ca2759c7b2c","block_type":"box","text":"development, making returns more sensitive to energy prices. In the recent decade, gas utility companies have been","page_number":126,"box":{"x":69,"y":340,"width":831,"height":11}},{"id":"6a28d4ee-6b64-4755-897c-410619524a19","block_type":"box","text":"adversely affected by disruptions in the oil industry and have also been affected by increased concentration and","page_number":126,"box":{"x":69,"y":355,"width":801,"height":11}},{"id":"0df23610-2eeb-4fd9-af3d-95d5cdc07d2e","block_type":"box","text":"competition. In the opinion of the Manager, however, environmental considerations could improve the gas industry","page_number":126,"box":{"x":69,"y":370,"width":815,"height":11}},{"id":"2c01dc67-9e9c-4527-b6d5-26fdbf2e457e","block_type":"box","text":"outlook in the future. For example, natural gas is the cleanest of the hydrocarbon fuels, and this may result in","page_number":126,"box":{"x":69,"y":385,"width":782,"height":11}},{"id":"3d0d7add-2b9b-4e96-bdd2-83b1397a448a","block_type":"box","text":"incremental shifts in fuel consumption toward natural gas and away from oil and coal, even for electricity generation.","page_number":126,"box":{"x":70,"y":400,"width":829,"height":11}},{"id":"9cb70aab-31bc-4420-9dff-c72db3ec6b56","block_type":"box","text":"However, technological or regulatory changes within the industry may delay or prevent this result.","page_number":126,"box":{"x":70,"y":415,"width":691,"height":11}},{"id":"4b95e69f-ae6f-46b8-9ea2-87f6222bfde9","block_type":"box","text":"Water.","page_number":126,"box":{"x":103,"y":438,"width":42,"height":9}},{"id":"e070ee16-59d3-4657-9bc7-7d5ff6a614b7","block_type":"box","text":"Water supply utilities are companies that collect, purify, distribute and sell water. In the United States and","page_number":126,"box":{"x":151,"y":438,"width":754,"height":11}},{"id":"bd81af16-2d08-4806-a84d-8d1a234bc654","block_type":"box","text":"around the world the industry is highly fragmented because most of the supplies are owned by local authorities.","page_number":126,"box":{"x":69,"y":453,"width":796,"height":11}},{"id":"7adeb335-e265-47e7-8a0e-4dadaec5141e","block_type":"box","text":"Companies in this industry are generally mature and are experiencing little or no per capita volume growth. In the","page_number":126,"box":{"x":69,"y":468,"width":806,"height":11}},{"id":"8264d21c-7597-45b1-a759-bd1cc92ec26d","block_type":"box","text":"opinion of the Manager, there may be oppor tunities for cer tain companies to acquire other water utility companies","page_number":126,"box":{"x":69,"y":483,"width":814,"height":11}},{"id":"29a2acd8-29a5-4906-accd-6f8771d29b6f","block_type":"box","text":"and for foreign acquisition of domestic companies. The Manager believes that favorable investment oppor tunities","page_number":126,"box":{"x":69,"y":498,"width":808,"height":11}},{"id":"e8c7d9ed-0e23-4ead-a6f5-70c225f48a0a","block_type":"box","text":"may result from consolidation of this segment. As with other utilities, however, increased regulation, increased costs","page_number":126,"box":{"x":69,"y":513,"width":832,"height":12}},{"id":"aff47233-56d7-4122-bb24-dfc4b0dbe1e8","block_type":"box","text":"and potential disruptions in supply may adversely affect investments in water supply utilities.","page_number":126,"box":{"x":69,"y":528,"width":662,"height":12}},{"id":"d0edd681-d71a-4753-b936-731ba8ebc2e4","block_type":"box","text":"Utility Industries Generally.","page_number":126,"box":{"x":103,"y":551,"width":186,"height":11}},{"id":"8052aeb2-7bf8-4fea-8b4d-070eb0e9ee4e","block_type":"box","text":"There can be no assurance that the positive developments noted above, including","page_number":126,"box":{"x":296,"y":551,"width":584,"height":11}},{"id":"5182d3d9-5df6-460d-beed-62b0ad8dc1b8","block_type":"box","text":"those relating to privatization and changing regulation, will occur or that risk factors other than those noted above will","page_number":126,"box":{"x":68,"y":566,"width":837,"height":11}},{"id":"b7bdbb3b-5120-4f3d-9bae-6e9cd8517b11","block_type":"box","text":"not develop in the future.","page_number":126,"box":{"x":69,"y":581,"width":178,"height":11}},{"id":"a6e3fed3-e8af-4bf5-90a8-052c871d92b2","block_type":"box","text":"When-Issued Securities, Delayed Delivery Securities and Forward Commitments.","page_number":126,"box":{"x":103,"y":604,"width":585,"height":11}},{"id":"4e29152e-28bf-4516-9fe8-87de26168bdc","block_type":"box","text":"A Fund may purchase or sell","page_number":126,"box":{"x":694,"y":604,"width":200,"height":11}},{"id":"c6b6eccc-7012-444a-a211-1bedc1af13c6","block_type":"box","text":"securities that it is entitled to receive on a when-issued basis. A Fund may also purchase or sell securities on a","page_number":126,"box":{"x":69,"y":619,"width":795,"height":11}},{"id":"528bc723-e345-47aa-a53f-fe22d1aafd75","block_type":"box","text":"delayed delivery basis or through a forward commitment (including on a TBA (to be announced) basis). These","page_number":126,"box":{"x":69,"y":634,"width":777,"height":12}},{"id":"057569bc-8219-4499-b4a0-0e52328127e8","block_type":"box","text":"transactions involve the purchase or sale of securities by a Fund at an established price with payment and delivery","page_number":126,"box":{"x":68,"y":649,"width":820,"height":12}},{"id":"b6b57f81-0768-4bfe-85be-aba2f2acbfca","block_type":"box","text":"taking place in the future. The Fund enters into these transactions to obtain what is considered an advantageous","page_number":126,"box":{"x":68,"y":664,"width":807,"height":12}},{"id":"4f50cade-aa59-446c-afee-b801c542b9b5","block_type":"box","text":"price to the Fund at the time of entering into the transaction.","page_number":126,"box":{"x":70,"y":680,"width":430,"height":11}},{"id":"c5310a02-c044-4b65-979c-29b2474e2b1d","block_type":"box","text":"Pursuant to recommendations of the Treasury Market Practices Group, which is sponsored by the Federal","page_number":126,"box":{"x":102,"y":702,"width":750,"height":11}},{"id":"04a0b365-bf6f-461b-b291-08c0dbbc4b56","block_type":"box","text":"Reserve Bank of New York, a Fund or its counterpar ty generally will be required to post collateral when entering into","page_number":126,"box":{"x":70,"y":717,"width":823,"height":12}},{"id":"f542c842-36f9-460e-a1a9-0244842e2372","block_type":"box","text":"cer tain forward-settling transactions, including without limitation TBA transactions. FINRA rules have also been","page_number":126,"box":{"x":69,"y":732,"width":788,"height":12}},{"id":"b4308ddb-07c5-4b45-b527-8aff887c2113","block_type":"box","text":"implemented that include mandatory margin requirements for the TBA market with limited exceptions. The","page_number":126,"box":{"x":70,"y":748,"width":755,"height":11}},{"id":"60829195-bc23-4acc-85a6-bdfb8c23792b","block_type":"box","text":"collateralization of TBA trades is intended to mitigate counterpar ty credit risk between trade and settlement, but","page_number":126,"box":{"x":69,"y":763,"width":799,"height":11}},{"id":"ec6afde7-9aaf-4412-aa21-97d3606ba1f9","block_type":"box","text":"could increase the cost of TBA transactions and impose added operational complexity.","page_number":126,"box":{"x":69,"y":778,"width":614,"height":11}},{"id":"6664f224-ace2-4a58-ad73-a87bb9b882f2","block_type":"box","text":"There can be no assurance that a security purchased on a when-issued basis will be issued or that a security","page_number":126,"box":{"x":101,"y":801,"width":780,"height":11}},{"id":"16afdadc-ffba-4f1b-aee2-842884388546","block_type":"box","text":"purchased or sold on a delayed delivery basis or through a forward commitment will be delivered. Also, the value of","page_number":126,"box":{"x":70,"y":816,"width":823,"height":11}},{"id":"64e1fdee-4f6c-4589-a6e8-b71a4eb4d32b","block_type":"box","text":"securities in these transactions on the delivery date may be more or less than the price paid by the Fund to purchase","page_number":126,"box":{"x":69,"y":831,"width":838,"height":11}},{"id":"5872c874-3037-4927-b616-cbc96b076790","block_type":"box","text":"the securities. The Fund will lose money if the value of the security in such a transaction declines below the purchase","page_number":126,"box":{"x":68,"y":846,"width":839,"height":11}},{"id":"b7abf3c5-fa78-43c3-8575-ecce6565f1b9","block_type":"box","text":"price and will not benefit if the value of the security appreciates above the sale price during the commitment period.","page_number":126,"box":{"x":70,"y":861,"width":824,"height":11}},{"id":"874b3593-c24c-4664-bb56-b185ca4c2943","block_type":"box","text":"II-79","page_number":126,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"85a2c935-fe9b-4d90-91d1-8ebb2df917c9","block_type":"box","text":"NM1026U-6033063-126/246","page_number":126,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"05a6dc86-f729-4803-ac1a-b6fa81493cc1","block_type":"box","text":"If deemed advisable as a matter of investment strategy, a Fund may dispose of or renegotiate a commitment","page_number":127,"box":{"x":102,"y":45,"width":776,"height":11}},{"id":"7ce4d035-037e-4320-8a6a-285b1f3ed10c","block_type":"box","text":"after it has been entered into, and may sell securities it has committed to purchase before those securities are","page_number":127,"box":{"x":69,"y":60,"width":795,"height":11}},{"id":"01a0e040-7ff3-44d0-9738-2b1ab7b97033","block_type":"box","text":"delivered to the Fund on the settlement date. In these cases the Fund may realize a taxable capital gain or loss.","page_number":127,"box":{"x":69,"y":75,"width":799,"height":11}},{"id":"09912888-5341-4bd0-96ce-121a7eef4500","block_type":"box","text":"When a Fund engages in when-issued, TBA or forward commitment transactions, it relies on the other par ty to","page_number":127,"box":{"x":101,"y":98,"width":784,"height":11}},{"id":"57e71afa-3f56-4a74-87ba-783137f363f5","block_type":"box","text":"consummate the trade. Failure of such par ty to do so may result in the Fund’s incurring a loss or missing an","page_number":127,"box":{"x":69,"y":113,"width":772,"height":11}},{"id":"345a85ab-dc55-45a6-a95d-78670ddb9b91","block_type":"box","text":"oppor tunity to obtain a price considered to be advantageous.","page_number":127,"box":{"x":69,"y":128,"width":434,"height":11}},{"id":"541fb5d5-be60-441d-8bdf-f435c149d922","block_type":"box","text":"The market value of the securities underlying a commitment to purchase securities, and any subsequent","page_number":127,"box":{"x":101,"y":150,"width":745,"height":12}},{"id":"ddea613d-0064-46c7-b8d0-5b03d9acdc79","block_type":"box","text":"fluctuations in their market value, is taken into account when determining the market value of a Fund star ting on the","page_number":127,"box":{"x":68,"y":166,"width":831,"height":11}},{"id":"79b5cae5-7373-436c-b6e1-5af06e44554c","block_type":"box","text":"day the Fund agrees to purchase the securities. The Fund does not earn interest on the securities it has committed","page_number":127,"box":{"x":69,"y":181,"width":823,"height":11}},{"id":"ba40b10b-d750-40f1-8b84-4a4a986ca553","block_type":"box","text":"to purchase until they are paid for and delivered on the settlement date.","page_number":127,"box":{"x":68,"y":196,"width":514,"height":11}},{"id":"b3e8a427-7e9a-4d0e-a788-21ec39e6214a","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into when-issued or forward-settling","page_number":127,"box":{"x":102,"y":218,"width":759,"height":12}},{"id":"644df65c-3d29-4aa1-aaa6-d4b11fd5b5b2","block_type":"box","text":"securities (","page_number":127,"box":{"x":69,"y":234,"width":78,"height":11}},{"id":"35cad15e-f5ef-459f-800b-b4b1b9000919","block_type":"box","text":"e.g.","page_number":127,"box":{"x":148,"y":235,"width":25,"height":10}},{"id":"9e0a0ac2-4448-4971-8037-41773899ef01","block_type":"box","text":", firm and standby commitments, including TBA commitments, and dollar rolls) and non-standard","page_number":127,"box":{"x":176,"y":234,"width":686,"height":11}},{"id":"05d239dd-866d-4f3b-9796-d2c536cba88b","block_type":"box","text":"settlement cycle securities notwithstanding the limitation on the issuance of senior securities in Section 18 of the","page_number":127,"box":{"x":69,"y":249,"width":813,"height":11}},{"id":"9cc93d3c-80bf-4950-8fed-198fa5d6b682","block_type":"box","text":"Investment Company Act, provided that the Fund intends to physically settle the transaction and the transaction will","page_number":127,"box":{"x":70,"y":264,"width":822,"height":11}},{"id":"d42a9fb0-7adb-423f-9144-f8bf18976512","block_type":"box","text":"settle within 35 days of its trade date (the “Delayed-Settlement Securities Provision”). If a when-issued, forward","page_number":127,"box":{"x":69,"y":279,"width":802,"height":11}},{"id":"63114402-4280-472f-9ee8-bf5f359d1532","block_type":"box","text":"settling or non-standard settlement cycle security does not satisfy the Delayed-Settlement Securities Provision, then","page_number":127,"box":{"x":69,"y":294,"width":826,"height":11}},{"id":"f78db148-68fc-482b-acd2-a83414d72989","block_type":"box","text":"it is treated as a Derivatives Transaction under Rule 18f-4. See “—Derivatives — Regulation of Derivatives — Rule","page_number":127,"box":{"x":70,"y":309,"width":816,"height":11}},{"id":"76115942-b832-4ef9-85a5-99f675001cbf","block_type":"box","text":"18f-4 under the Investment Company Act” above.","page_number":127,"box":{"x":70,"y":324,"width":349,"height":11}},{"id":"edcf4232-a227-429c-884b-80150b7c2063","block_type":"box","text":"Regulations adopted by global prudential regulators require cer tain bank-regulated counterpar ties and cer tain of","page_number":127,"box":{"x":102,"y":347,"width":800,"height":11}},{"id":"dcb0369f-e35a-4f9f-95a6-8beaaaf43eb7","block_type":"box","text":"their affiliates to include in cer tain financial contracts, including many agreements with respect to when-issued, TBA","page_number":127,"box":{"x":68,"y":362,"width":829,"height":11}},{"id":"5d262417-03ba-4164-b7dc-5e799e1a3481","block_type":"box","text":"and forward commitment transactions, terms that delay or restrict the rights of counterpar ties, such as a Fund, to","page_number":127,"box":{"x":69,"y":377,"width":814,"height":12}},{"id":"b0a29c15-f32b-42c7-b90a-00d04e1686b5","block_type":"box","text":"terminate such agreements, foreclose upon collateral, exercise other default rights or restrict transfers of credit","page_number":127,"box":{"x":68,"y":392,"width":799,"height":12}},{"id":"1c5e587f-fab4-4407-832b-681c41d0d3a8","block_type":"box","text":"suppor t in the event that the counterpar ty and/or its affiliates are subject to cer tain types of resolution or insolvency","page_number":127,"box":{"x":69,"y":407,"width":836,"height":12}},{"id":"a085085a-41ab-497b-8888-0da4a3b0651b","block_type":"box","text":"proceedings. It is possible that these requirements, as well as potential additional government regulation and other","page_number":127,"box":{"x":70,"y":423,"width":824,"height":11}},{"id":"82b88a83-3573-490f-8953-b4828efc518d","block_type":"box","text":"developments in the market, could adversely affect a Fund’s ability to terminate existing agreements with respect to","page_number":127,"box":{"x":69,"y":438,"width":829,"height":11}},{"id":"8a83297c-fef2-480c-9bba-a74d8de4ffa8","block_type":"box","text":"these transactions or to realize amounts to be received under such agreements.","page_number":127,"box":{"x":68,"y":453,"width":573,"height":11}},{"id":"af99b093-aee5-4bc7-8c11-3bf6cca6156b","block_type":"box","text":"Yields and Ratings.","page_number":127,"box":{"x":103,"y":476,"width":139,"height":11}},{"id":"adb339a6-7a6f-4d55-b811-f27a955a16d8","block_type":"box","text":"The yields on cer tain obligations are dependent on a variety of factors, including general","page_number":127,"box":{"x":247,"y":475,"width":628,"height":12}},{"id":"155fa407-6670-4bd4-b1a6-db026557399d","block_type":"box","text":"market conditions, conditions in the par ticular market for the obligation, the financial condition of the issuer, the size","page_number":127,"box":{"x":69,"y":491,"width":834,"height":11}},{"id":"d91501df-d7e3-43d9-a96b-9eb3684c1175","block_type":"box","text":"of the offering, the maturity of the obligation and the ratings of the issue. The ratings of Moody’s, Fitch and S&P","page_number":127,"box":{"x":69,"y":506,"width":799,"height":11}},{"id":"48c868fb-909b-46aa-96a9-8e74c4fc0fc2","block_type":"box","text":"represent their respective opinions as to the quality of the obligations they under take to rate. Ratings, however, are","page_number":127,"box":{"x":69,"y":521,"width":824,"height":11}},{"id":"ac286f53-0c6e-41e3-a1df-610977f38530","block_type":"box","text":"general and are not absolute standards of quality. Consequently, obligations with the same rating, maturity and","page_number":127,"box":{"x":68,"y":536,"width":792,"height":11}},{"id":"b15bb9fb-3af5-4a06-b64e-5a82ef70269e","block_type":"box","text":"interest rate may have different market prices. Subsequent to its purchase by a Fund, a rated security may cease to","page_number":127,"box":{"x":70,"y":551,"width":827,"height":11}},{"id":"32365cfa-74ac-4c62-9b3c-1dc065c264ba","block_type":"box","text":"be rated. A Fund’s Manager or sub-adviser will consider such an event in determining whether the Fund should","page_number":127,"box":{"x":69,"y":566,"width":786,"height":11}},{"id":"48256f0f-69b9-47c0-8b3a-fdfd8d056eb8","block_type":"box","text":"continue to hold the security.","page_number":127,"box":{"x":69,"y":582,"width":204,"height":10}},{"id":"d6ac8636-bdd3-4fd1-b0f9-18f5be142358","block_type":"box","text":"Zero Coupon Securities.","page_number":127,"box":{"x":102,"y":604,"width":175,"height":11}},{"id":"9ba1dec3-2136-4479-8c6e-f7982fc6ab01","block_type":"box","text":"Zero coupon securities are securities that are sold at a discount to par value and do","page_number":127,"box":{"x":283,"y":604,"width":601,"height":11}},{"id":"6a396183-724d-4bed-bf5d-5996b92ae451","block_type":"box","text":"not pay interest during the life of the security. The discount approximates the total amount of interest the security will","page_number":127,"box":{"x":69,"y":619,"width":837,"height":11}},{"id":"7cf4649c-0e9e-4e56-82f8-f97406ac2f4e","block_type":"box","text":"accrue and compound over the period until maturity at a rate of interest reflecting the market rate of the security at","page_number":127,"box":{"x":69,"y":634,"width":822,"height":12}},{"id":"41e2fc5e-af44-4c98-b160-28fd9b2011af","block_type":"box","text":"the time of issuance. Upon maturity, the holder of a zero coupon security is entitled to receive the par value of the","page_number":127,"box":{"x":68,"y":649,"width":814,"height":12}},{"id":"6b35c84e-45e0-411c-b952-3e4cac972ead","block_type":"box","text":"security.","page_number":127,"box":{"x":69,"y":665,"width":57,"height":11}},{"id":"3d3bc75c-67ae-4de9-9cda-c48d0741ea5d","block_type":"box","text":"While interest payments are not made on such securities, holders of such securities are deemed to have","page_number":127,"box":{"x":101,"y":687,"width":749,"height":11}},{"id":"73247f71-3f2a-42ed-8ad3-2bf96fa3a8f3","block_type":"box","text":"received income (“phantom income”) annually, notwithstanding that cash may not be received currently. The effect of","page_number":127,"box":{"x":69,"y":702,"width":835,"height":12}},{"id":"2c8794f6-cd32-4540-be72-bfdff946d25a","block_type":"box","text":"owning instruments that do not make current interest payments is that a fixed yield is earned not only on the original","page_number":127,"box":{"x":69,"y":717,"width":833,"height":12}},{"id":"99337c40-dd52-453c-b114-8e1e7bb77667","block_type":"box","text":"investment but also, in effect, on all discount accretion during the life of the obligations. This implicit reinvestment of","page_number":127,"box":{"x":70,"y":732,"width":836,"height":12}},{"id":"9c23abb2-29e9-49e3-a53e-305e0505d13f","block_type":"box","text":"earnings at a fixed rate eliminates the risk of being unable to invest distributions at a rate as high as the implicit","page_number":127,"box":{"x":69,"y":748,"width":804,"height":11}},{"id":"43ce64c0-0b87-4266-9ba6-150284135ba2","block_type":"box","text":"yield on the zero coupon bond, but at the same time eliminates the holder’s ability to reinvest at higher rates in the","page_number":127,"box":{"x":68,"y":763,"width":824,"height":11}},{"id":"6f25afa6-d924-47a7-9951-326a2e15d51e","block_type":"box","text":"future. For this reason, some of these securities may be subject to substantially greater price fluctuations during","page_number":127,"box":{"x":68,"y":778,"width":805,"height":11}},{"id":"744cd46c-8a9e-4f8c-b38d-e71656cc7803","block_type":"box","text":"periods of changing market interest rates than are comparable securities that pay interest currently. Longer term zero","page_number":127,"box":{"x":70,"y":793,"width":837,"height":11}},{"id":"e235b5c6-76de-4751-a45b-a5856468b752","block_type":"box","text":"coupon bonds are more exposed to interest rate risk than shor ter term zero coupon bonds. These investments","page_number":127,"box":{"x":69,"y":808,"width":791,"height":11}},{"id":"ee1535bc-6269-4b4d-917f-403a1610150d","block_type":"box","text":"benefit the issuer by mitigating its need for cash to meet debt service, but also require a higher rate of return to","page_number":127,"box":{"x":69,"y":823,"width":800,"height":12}},{"id":"5bd73372-532a-470e-9395-e76b1e794dc8","block_type":"box","text":"attract investors who are willing to defer receipt of cash.","page_number":127,"box":{"x":69,"y":838,"width":400,"height":12}},{"id":"081e28e8-246f-42f7-a3bb-f6d3b35393b0","block_type":"box","text":"A Fund accrues income with respect to these securities for U.S. federal income tax and accounting purposes","page_number":127,"box":{"x":101,"y":861,"width":775,"height":11}},{"id":"9ed97201-506e-45d9-ac08-b1933160cad6","block_type":"box","text":"prior to the receipt of cash payments. Zero coupon securities may be subject to greater fluctuation in value and less","page_number":127,"box":{"x":70,"y":876,"width":827,"height":11}},{"id":"9519492e-55c3-487b-ae4b-72483299c5a6","block_type":"box","text":"liquidity in the event of adverse market conditions than comparably rated securities that pay cash interest at regular","page_number":127,"box":{"x":70,"y":891,"width":826,"height":12}},{"id":"073709e3-c7eb-4bd1-9432-b8d89ca69181","block_type":"box","text":"intervals.","page_number":127,"box":{"x":70,"y":907,"width":64,"height":8}},{"id":"27619b5e-769c-4246-a1ab-0a96651880e4","block_type":"box","text":"II-80","page_number":127,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"9cd8bcb5-0b05-44cb-b614-295401423998","block_type":"box","text":"NM1026U-6033063-127/246","page_number":127,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"55fa774b-393b-4cd9-be71-98772635894e","block_type":"box","text":"Fur ther, to maintain its qualification for pass-through treatment under the U.S. federal tax laws, a Fund is","page_number":128,"box":{"x":102,"y":45,"width":749,"height":11}},{"id":"7d31c7c2-43df-4502-a500-a1f42e9bfefb","block_type":"box","text":"required to distribute income to its shareholders and, consequently, may have to dispose of other, more liquid","page_number":128,"box":{"x":69,"y":60,"width":784,"height":11}},{"id":"c0cfa688-daa4-4792-b45d-db4a95841392","block_type":"box","text":"por tfolio securities under disadvantageous circumstances or may have to leverage itself by borrowing in order to","page_number":128,"box":{"x":70,"y":75,"width":799,"height":11}},{"id":"57b287d1-ac0b-489c-aca1-3f3f9b00b332","block_type":"box","text":"generate the cash to satisfy these distributions. The required distributions may result in an increase in a Fund’s","page_number":128,"box":{"x":68,"y":90,"width":799,"height":11}},{"id":"6bc8fe32-458f-4f09-bf70-230272760d30","block_type":"box","text":"exposure to zero coupon securities.","page_number":128,"box":{"x":69,"y":105,"width":253,"height":11}},{"id":"4f6a0cd8-7339-4f0c-88fd-71d564c0cc21","block_type":"box","text":"In addition to the above-described risks, there are cer tain other risks related to investing in zero coupon","page_number":128,"box":{"x":102,"y":128,"width":740,"height":11}},{"id":"583c99a2-06c5-4927-b380-a5c1c7fa9437","block_type":"box","text":"securities. During a period of severe market conditions, the market for such securities may become even less liquid.","page_number":128,"box":{"x":69,"y":143,"width":829,"height":11}},{"id":"1f26ea76-6b42-44d7-8c21-89cab17cf927","block_type":"box","text":"In addition, as these securities do not pay cash interest, a Fund’s investment exposure to these securities and their","page_number":128,"box":{"x":70,"y":158,"width":829,"height":11}},{"id":"910d6799-4ddd-4143-9b3b-c2665ba9c5c7","block_type":"box","text":"risks, including credit risk, will increase during the time these securities are held in the Fund’s por tfolio.","page_number":128,"box":{"x":69,"y":173,"width":741,"height":11}},{"id":"ac6de4c6-b78c-4228-9d38-45b6a468e51f","block_type":"box","text":"Suitability. (All Funds)","page_number":128,"box":{"x":101,"y":196,"width":161,"height":11}},{"id":"ecf41c46-93ba-4f3a-a0b9-99ec6b005948","block_type":"box","text":"The economic benefit of an investment in any Fund depends upon many factors beyond the control of the Fund,","page_number":128,"box":{"x":101,"y":218,"width":793,"height":12}},{"id":"d36ff1d2-6ef2-4796-9419-407c2218d287","block_type":"box","text":"the Manager and its affiliates. Each Fund should be considered a vehicle for diversification and not as a balanced","page_number":128,"box":{"x":68,"y":234,"width":811,"height":11}},{"id":"f100f0c7-2ae6-4910-b303-5d4c5299a810","block_type":"box","text":"investment program. The suitability for any par ticular investor of a purchase of shares in a Fund will depend upon,","page_number":128,"box":{"x":70,"y":249,"width":810,"height":11}},{"id":"7012bf7a-7eac-4c86-9df8-ee2ab28648e4","block_type":"box","text":"among other things, such investor’s investment objectives and such investor’s ability to accept the risks associated","page_number":128,"box":{"x":69,"y":264,"width":826,"height":11}},{"id":"356c6284-08d2-45ab-858c-95f22415be63","block_type":"box","text":"with investing in securities, including the risk of loss of principal.","page_number":128,"box":{"x":68,"y":279,"width":460,"height":11}},{"id":"50fa93a3-8cd8-4c4a-baa1-92558ed70534","block_type":"box","text":"Investment Restrictions. (All Funds)","page_number":128,"box":{"x":102,"y":302,"width":264,"height":11}},{"id":"c597e6c8-aa3a-42a5-9990-38d9e8e9c431","block_type":"box","text":"See “Investment Restrictions” or “Investment Policies,” as applicable in each Fund’s SAI for the specific","page_number":128,"box":{"x":102,"y":324,"width":745,"height":11}},{"id":"c28e144c-f41c-4257-a937-2301b6258fc2","block_type":"box","text":"fundamental and non-fundamental investment restrictions adopted by each Fund. In addition to those investment","page_number":128,"box":{"x":68,"y":339,"width":807,"height":12}},{"id":"7dfc5129-e6f9-4789-819a-6332d34c1b99","block_type":"box","text":"restrictions, each Fund is also subject to the restrictions discussed below.","page_number":128,"box":{"x":69,"y":355,"width":528,"height":11}},{"id":"f84a9059-6db0-4336-92f9-0117a144d685","block_type":"box","text":"Each Fund’s investments will be limited in order to allow the Fund to qualify as a “regulated investment","page_number":128,"box":{"x":102,"y":377,"width":735,"height":12}},{"id":"83a611b4-2740-40ba-918d-af6b506bccf3","block_type":"box","text":"company” for purposes of the Code. See “Dividends and Taxes — Taxes” or “Taxes.” To qualify, among other","page_number":128,"box":{"x":69,"y":392,"width":775,"height":12}},{"id":"4964f3db-1b73-4b45-b2e5-2ffb2c2ffac0","block_type":"box","text":"requirements, each Fund will limit its investments so that, at the close of each quar ter of the taxable year, (i) at least","page_number":128,"box":{"x":69,"y":407,"width":837,"height":12}},{"id":"49429728-c296-476c-98a3-2d2ad371d46f","block_type":"box","text":"50% of the market value of each Fund’s assets is represented by cash, securities of other regulated investment","page_number":128,"box":{"x":69,"y":423,"width":799,"height":11}},{"id":"63cdd7a4-b997-489a-b779-c270453e33bf","block_type":"box","text":"companies, U.S. Government Securities and other securities, with such other securities limited, in respect of any one","page_number":128,"box":{"x":69,"y":438,"width":837,"height":11}},{"id":"4e9a5eae-ea9e-497b-ad4e-06570e0d413c","block_type":"box","text":"issuer, to an amount not greater in value than 5% of the Fund’s assets and not greater than 10% of the outstanding","page_number":128,"box":{"x":70,"y":453,"width":825,"height":11}},{"id":"c612a719-d922-4f77-b990-cf866b1a017a","block_type":"box","text":"voting securities of such issuer and (ii) not more than 25% of the value of its assets is invested in the securities","page_number":128,"box":{"x":68,"y":468,"width":802,"height":11}},{"id":"ea4aaeea-74ad-4def-9857-fa0e719832e1","block_type":"box","text":"(other than U.S. Government Securities or securities of other regulated investment companies) of any one issuer, any","page_number":128,"box":{"x":69,"y":483,"width":837,"height":11}},{"id":"b705d33a-5460-49dd-85fb-9e1ffa16725d","block_type":"box","text":"two or more issuers that the Fund controls and that are determined to be engaged in the same or similar trades or","page_number":128,"box":{"x":68,"y":498,"width":819,"height":11}},{"id":"b68a6c2b-62c7-4da2-bb84-d4d0325ce593","block_type":"box","text":"businesses or related trades or businesses or in the securities of one or more qualified publicly traded par tnerships","page_number":128,"box":{"x":69,"y":513,"width":828,"height":11}},{"id":"39492326-90b3-4a6d-a6ca-1419570fb994","block_type":"box","text":"(","page_number":128,"box":{"x":69,"y":529,"width":3,"height":10}},{"id":"4d2d5ef4-f4a6-4cf8-9c4d-590e787d15c8","block_type":"box","text":"i.e.","page_number":128,"box":{"x":74,"y":529,"width":21,"height":8}},{"id":"66e517ca-fc14-48f7-9d7d-4dee7df83dc1","block_type":"box","text":", par tnerships that are traded on an established securities market or tradable on a secondary market, other than","page_number":128,"box":{"x":97,"y":529,"width":806,"height":11}},{"id":"7e3eeb90-e6f9-4eae-b3b7-42c90a6b2ddc","block_type":"box","text":"par tnerships that derive 90% of their income from interest, dividends, capital gains and other traditionally permitted","page_number":128,"box":{"x":70,"y":543,"width":824,"height":12}},{"id":"b74f250b-884f-4f94-8b4b-d4120e0c69e4","block_type":"box","text":"mutual fund income). For purposes of this restriction, the Municipal Funds generally will regard each state and each","page_number":128,"box":{"x":69,"y":559,"width":824,"height":11}},{"id":"fc74d6ba-de63-40c2-86d2-d9f078023a90","block_type":"box","text":"of its political subdivisions, agencies or instrumentalities and each multi-state agency of which the state is a member","page_number":128,"box":{"x":69,"y":574,"width":838,"height":11}},{"id":"a4d723f5-9042-4d3a-a96f-e410d01e6511","block_type":"box","text":"as a separate issuer. Each public authority that issues securities on behalf of a private entity generally will also be","page_number":128,"box":{"x":69,"y":589,"width":815,"height":11}},{"id":"bfe39146-ece1-4e33-867c-39f9390128a3","block_type":"box","text":"regarded as a separate issuer, except that if the security is backed only by the assets and revenues of a non","page_number":128,"box":{"x":69,"y":604,"width":781,"height":11}},{"id":"9d405b5d-ce16-4db7-b2cc-7346a4ae326c","block_type":"box","text":"government entity, then the entity with the ultimate responsibility for the payment of interest and principal may be","page_number":128,"box":{"x":68,"y":619,"width":810,"height":11}},{"id":"62306a38-19d5-4cd2-91c2-14edc44d366d","block_type":"box","text":"regarded as the sole issuer.","page_number":128,"box":{"x":69,"y":634,"width":198,"height":12}},{"id":"baf77da2-bf46-43d0-ace9-9a28fe61cfa5","block_type":"box","text":"Foreign government securities (unlike U.S. Government Securities) are not exempt from the 5%, 10% and 25%","page_number":128,"box":{"x":102,"y":657,"width":784,"height":11}},{"id":"d9bf54e7-7637-4160-a277-10c7ced7a546","block_type":"box","text":"diversification requirements of the Code discussed above and the securities of each foreign government issuer are","page_number":128,"box":{"x":69,"y":672,"width":819,"height":11}},{"id":"984bc4e0-f542-4e69-a1f2-42dcf9ada450","block_type":"box","text":"considered to be obligations of a single issuer. These tax-related limitations may be changed by the Directors of a","page_number":128,"box":{"x":69,"y":687,"width":811,"height":11}},{"id":"a5048513-149a-4f39-aec9-0326a26bcd40","block_type":"box","text":"Fund to the extent necessary to comply with changes to the U.S. federal tax requirements. A Fund that is","page_number":128,"box":{"x":70,"y":702,"width":747,"height":12}},{"id":"c613a561-e84f-4823-8ff2-570f1594b79c","block_type":"box","text":"“diversified” under the Investment Company Act must satisfy the foregoing 5% and 10% requirements with respect to","page_number":128,"box":{"x":70,"y":717,"width":834,"height":12}},{"id":"538ea5ea-45da-41fd-bf1a-628eca890762","block_type":"box","text":"75% of its total assets.","page_number":128,"box":{"x":69,"y":732,"width":165,"height":10}},{"id":"f0d879a7-d318-4b13-8b01-d33a4529e5b4","block_type":"box","text":"MANAGEMENT AND OTHER SERVICE ARRANGEMENTS","page_number":128,"box":{"x":268,"y":762,"width":442,"height":10}},{"id":"cbe27603-e17e-4f01-b62d-9a84fead77ad","block_type":"box","text":"Directors and Officers","page_number":128,"box":{"x":69,"y":792,"width":159,"height":9}},{"id":"6d59b360-533d-43d4-86ab-866e65bd38be","block_type":"box","text":"See “Information on Directors and Officers, ‘—Biographical Information,’ ‘— Share Ownership’ and ‘—","page_number":128,"box":{"x":102,"y":815,"width":733,"height":11}},{"id":"de79b474-63b4-4462-bf40-70b91aa874db","block_type":"box","text":"Compensation of Directors’” or “Information on Trustees and Officers, ‘—Biographical Information,’ ‘— Share","page_number":128,"box":{"x":69,"y":830,"width":783,"height":11}},{"id":"4d708ca9-be14-4068-a774-81f334e7f6dd","block_type":"box","text":"Ownership’ and ‘— Compensation of Trustees’,” as applicable, in Par t I of each Fund’s SAI for biographical and","page_number":128,"box":{"x":69,"y":845,"width":795,"height":12}},{"id":"3ae198b5-43bb-4e3c-8f89-7249f5d7aa0c","block_type":"box","text":"cer tain other information relating to the Directors and officers of your Fund, including Directors’ compensation.","page_number":128,"box":{"x":69,"y":860,"width":789,"height":12}},{"id":"09ddd082-e663-4183-b2c7-d219d9510f8e","block_type":"box","text":"II-81","page_number":128,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"05216bd8-1318-4d60-a5e2-11bfb6816d64","block_type":"box","text":"NM1026U-6033063-128/246","page_number":128,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"8645de54-4060-46b4-98cc-9656c7d189dd","block_type":"box","text":"Management Arrangements","page_number":129,"box":{"x":69,"y":45,"width":202,"height":11}},{"id":"53bff563-c6ee-4b83-82d8-c61a7269073f","block_type":"box","text":"Management Services.","page_number":129,"box":{"x":102,"y":67,"width":162,"height":12}},{"id":"d45a0476-81ad-4a29-a3fd-b49ecb1fb876","block_type":"box","text":"The Manager provides each Fund with investment advisory and management services.","page_number":129,"box":{"x":270,"y":68,"width":615,"height":11}},{"id":"6076e1ed-c0db-4716-ba83-978f8ff0f3b5","block_type":"box","text":"Subject to the oversight of the Board of Directors, the Manager is responsible for the actual management of a Fund’s","page_number":129,"box":{"x":69,"y":82,"width":836,"height":12}},{"id":"c0d6e285-1ff0-4e81-8761-b97af93d0817","block_type":"box","text":"por tfolio and reviews the Fund’s holdings in light of its own research analysis and that from other relevant sources.","page_number":129,"box":{"x":70,"y":98,"width":820,"height":11}},{"id":"d0e9b94a-3cf6-456d-97b6-97d80e0e4e73","block_type":"box","text":"The responsibility for making decisions to buy, sell or hold a par ticular security rests with the Manager. The Manager","page_number":129,"box":{"x":68,"y":113,"width":832,"height":11}},{"id":"c2cf67be-ac5e-41f0-8c72-c8d516969126","block_type":"box","text":"per forms cer tain of the other administrative services and provides all the office space, facilities, equipment and","page_number":129,"box":{"x":70,"y":128,"width":801,"height":11}},{"id":"96459800-7b15-4ca6-aca9-d0bf50dd6107","block_type":"box","text":"necessary personnel for management of each Fund.","page_number":129,"box":{"x":69,"y":143,"width":370,"height":11}},{"id":"01cc5a5c-4cde-43aa-af53-6dfd9781f374","block_type":"box","text":"Each Feeder Fund invests all or a por tion of its assets in shares of a Master Por tfolio. To the extent a Feeder","page_number":129,"box":{"x":102,"y":166,"width":778,"height":11}},{"id":"685dcfcb-c366-46e5-85ba-d099d1789825","block_type":"box","text":"Fund invests all of its assets in a Master Por tfolio, it does not invest directly in por tfolio securities and does not","page_number":129,"box":{"x":70,"y":181,"width":800,"height":11}},{"id":"25ead15e-c21a-4cbd-9734-4e76b5e2a9eb","block_type":"box","text":"require management services. For such Feeder Funds, por tfolio management occurs at the Master Por tfolio level.","page_number":129,"box":{"x":69,"y":196,"width":810,"height":11}},{"id":"4df81955-4a80-45d8-be7a-861fa39ec574","block_type":"box","text":"Management Fee.","page_number":129,"box":{"x":102,"y":219,"width":126,"height":11}},{"id":"8d174910-deb0-42e5-a6a0-185b08f9e086","block_type":"box","text":"Each Fund has entered into a Management Agreement with the Manager pursuant to which","page_number":129,"box":{"x":235,"y":219,"width":646,"height":11}},{"id":"de4ad2c7-b486-41d9-88c4-66f2e4525179","block_type":"box","text":"the Manager receives for its services to the Fund monthly compensation at an annual rate based on the average daily","page_number":129,"box":{"x":68,"y":234,"width":841,"height":11}},{"id":"6a32db86-9842-4d1d-877e-b4647e6817b6","block_type":"box","text":"net assets of the Fund. For information regarding the fees paid by your Fund to the Manager for the Fund’s last three","page_number":129,"box":{"x":69,"y":249,"width":833,"height":11}},{"id":"fbbcd3bc-9e0e-4e5f-bff4-55442b8dee60","block_type":"box","text":"fiscal years or other applicable periods, see “Management, Advisory and Other Service Arrangements —","page_number":129,"box":{"x":68,"y":264,"width":746,"height":11}},{"id":"877c7f2a-77f4-4550-9693-0c471cb8ccfe","block_type":"box","text":"Management Agreement” or “Management and Advisory Arrangements,” as applicable, in Par t I of each Fund’s SAI.","page_number":129,"box":{"x":70,"y":279,"width":825,"height":11}},{"id":"6f2a8dda-1f78-495b-95a8-db0e8a247883","block_type":"box","text":"For Funds that do not have an administrator, each Management Agreement obligates the Manager to provide","page_number":129,"box":{"x":102,"y":302,"width":774,"height":11}},{"id":"65779961-8264-4340-b99f-0bd2ddb190d1","block_type":"box","text":"management services and to pay all compensation of and furnish office space for officers and employees of a Fund","page_number":129,"box":{"x":69,"y":317,"width":826,"height":11}},{"id":"a2d6ec84-8331-4042-bb76-dc55da6b255f","block_type":"box","text":"in connection with investment and economic research, trading and investment management of the Fund, as well as","page_number":129,"box":{"x":70,"y":332,"width":820,"height":11}},{"id":"a759f183-6a2c-4f86-a693-b13610b4c86f","block_type":"box","text":"the fees of all Directors of the Fund who are interested persons of the Fund. Each Fund pays all other expenses","page_number":129,"box":{"x":68,"y":347,"width":797,"height":11}},{"id":"03d56e69-c202-4c13-9ddb-6b63f2a72d04","block_type":"box","text":"incurred in the operation of that Fund, including among other things: taxes; expenses for legal and auditing services;","page_number":129,"box":{"x":70,"y":362,"width":830,"height":11}},{"id":"3f1aca8d-cece-4c24-bec5-4ccfb423f6c1","block_type":"box","text":"costs of preparing, printing and mailing proxies, shareholder repor ts, prospectuses and statements of additional","page_number":129,"box":{"x":69,"y":377,"width":802,"height":12}},{"id":"c5857c7c-693e-4aa5-b567-65ef57c97f48","block_type":"box","text":"information, except to the extent paid by BlackRock Investments, LLC (“BRIL” or the “Distributor”); charges of the","page_number":129,"box":{"x":70,"y":392,"width":809,"height":12}},{"id":"4674d7ae-78d7-468b-84c3-4f8c9b34ea3e","block_type":"box","text":"custodian and sub-custodian, and the transfer agent; expenses of redemption of shares; Commission fees; expenses","page_number":129,"box":{"x":69,"y":407,"width":838,"height":12}},{"id":"f6f18cae-5f98-4311-b9d6-64c6a16abae3","block_type":"box","text":"of registering the shares under Federal, state or foreign laws; fees and expenses of Directors who are not interested","page_number":129,"box":{"x":69,"y":423,"width":830,"height":11}},{"id":"c7dbdf52-a6cc-443d-b190-f7be7b16f546","block_type":"box","text":"persons of a Fund as defined in the Investment Company Act; accounting and pricing costs (including the daily","page_number":129,"box":{"x":70,"y":438,"width":784,"height":11}},{"id":"575c16d8-6b92-40ee-bbc8-82355f7b4036","block_type":"box","text":"calculations of NAV); insurance; interest; brokerage costs; litigation and other extraordinary or non-recurring","page_number":129,"box":{"x":69,"y":453,"width":767,"height":11}},{"id":"f76db5b5-d3fb-4f65-9221-9fe1e1d7b2c5","block_type":"box","text":"expenses; and other expenses properly payable by the Fund. Cer tain accounting services are provided to each Fund","page_number":129,"box":{"x":69,"y":468,"width":825,"height":11}},{"id":"97fa1a83-6857-4256-a003-9888bf2c0e7a","block_type":"box","text":"by State Street Bank and Trust Company (“State Street”), BNY Mellon Investment Servicing (US) Inc. (“BNY Mellon”)","page_number":129,"box":{"x":69,"y":483,"width":830,"height":11}},{"id":"048752a6-cace-4b69-a2c5-6acf9e1f9557","block_type":"box","text":"or JPMorgan Chase Bank, N.A. (“JPM”) pursuant to an agreement between State Street, BNY Mellon or JPM, as","page_number":129,"box":{"x":69,"y":498,"width":794,"height":11}},{"id":"ad78b480-ff6e-451e-b1c3-f34adcd83b6a","block_type":"box","text":"applicable, and each Fund. Each Fund pays a fee for these services. In addition, the Manager provides cer tain","page_number":129,"box":{"x":69,"y":513,"width":786,"height":12}},{"id":"f3b69de4-d9e9-4e9e-8164-676ab8eb03bd","block_type":"box","text":"accounting services to each Fund and the Fund pays the Manager a fee for such services. The Distributor pays","page_number":129,"box":{"x":69,"y":528,"width":790,"height":12}},{"id":"68047379-df89-4779-9fae-395d3e2c5a2e","block_type":"box","text":"cer tain promotional expenses of the Funds incurred in connection with the offering of shares of the Funds. Cer tain","page_number":129,"box":{"x":69,"y":543,"width":817,"height":12}},{"id":"08e5e3a4-ad00-4cce-b82c-66b7d4d8e555","block_type":"box","text":"expenses are financed by each Fund pursuant to distribution plans in compliance with Rule 12b-1 under the","page_number":129,"box":{"x":69,"y":559,"width":767,"height":11}},{"id":"a87e8e65-7143-45ae-b708-52cd972d7f7f","block_type":"box","text":"Investment Company Act. See “Purchase of Shares — Distribution and/or Shareholder Servicing Plans.”","page_number":129,"box":{"x":70,"y":574,"width":743,"height":11}},{"id":"08590e4d-0885-4a94-9231-62628400d66c","block_type":"box","text":"Sub-Advisory Fee.","page_number":129,"box":{"x":102,"y":597,"width":124,"height":11}},{"id":"ea218e63-5442-4247-bc25-b53684f58d38","block_type":"box","text":"The Manager of cer tain Funds has entered into one or more sub-advisory agreements (the","page_number":129,"box":{"x":232,"y":596,"width":643,"height":12}},{"id":"a4ca152d-2844-4e73-8f0c-48e09fa49797","block_type":"box","text":"“Sub-Advisory Agreements”) with the sub-adviser or sub-advisers identified in each such Fund’s Prospectus (the “Sub","page_number":129,"box":{"x":70,"y":612,"width":839,"height":11}},{"id":"1b8532ce-533b-4236-b031-1de57662a8c9","block_type":"box","text":"Adviser”) pursuant to which the Sub-Adviser provides sub-advisory services to the Manager with respect to the Fund.","page_number":129,"box":{"x":68,"y":627,"width":830,"height":11}},{"id":"8913c489-1b41-4a86-8367-0be23e6ef4ef","block_type":"box","text":"Organization of the Manager.","page_number":129,"box":{"x":102,"y":649,"width":204,"height":12}},{"id":"258b18f3-940f-4c8e-9726-b4dafd70c0db","block_type":"box","text":"BlackRock Advisors, LLC is a Delaware limited liability company and BlackRock","page_number":129,"box":{"x":313,"y":649,"width":560,"height":12}},{"id":"e332fe81-a8e6-470c-9119-39f8a0cb64f7","block_type":"box","text":"Fund Advisors is a California corporation. Each Manager is an indirect, majority-owned subsidiary of BlackRock, Inc.","page_number":129,"box":{"x":70,"y":664,"width":819,"height":12}},{"id":"39e656f2-d6c6-4960-932d-f4e3dc5642da","block_type":"box","text":"BlackRock, Inc., through its subsidiaries and divisions, provides (i) investment management services to individuals","page_number":129,"box":{"x":70,"y":680,"width":817,"height":11}},{"id":"c1f16de6-f953-4648-aa68-122c914bc50b","block_type":"box","text":"and institutional investors through separate account management, non-discretionary advisory programs and","page_number":129,"box":{"x":69,"y":695,"width":768,"height":11}},{"id":"3a15fd6c-0425-4b0d-8eac-8b2ce0d8293e","block_type":"box","text":"commingled investment vehicles; (ii) risk management services, investment accounting and trade processing tools;","page_number":129,"box":{"x":69,"y":710,"width":821,"height":11}},{"id":"56905cbb-ae15-463e-9788-38515930807f","block_type":"box","text":"(iii) transition management services, and (iv) securities lending services.","page_number":129,"box":{"x":69,"y":725,"width":517,"height":11}},{"id":"4db87d3a-62f9-4101-9308-a6bff4b71afb","block_type":"box","text":"Duration and Termination.","page_number":129,"box":{"x":102,"y":748,"width":182,"height":9}},{"id":"c346be1f-14b6-4ba7-b884-581b85488100","block_type":"box","text":"Unless earlier terminated as described below, each Management Agreement and each","page_number":129,"box":{"x":292,"y":748,"width":613,"height":11}},{"id":"ec35dd94-00e7-4830-ab6f-1ffa6dfe6109","block_type":"box","text":"Sub-Advisory Agreement will remain in effect for an initial two year period and from year to year thereafter if approved","page_number":129,"box":{"x":69,"y":763,"width":835,"height":11}},{"id":"603dc58b-7e00-4506-8572-5759b27c4337","block_type":"box","text":"annually (a) by the Board of Directors or by a vote of a majority of the outstanding voting securities of a Fund and","page_number":129,"box":{"x":69,"y":778,"width":803,"height":11}},{"id":"0f5c9cb3-264b-4f91-83b2-a357cfc41bd2","block_type":"box","text":"(b) by a majority of the Directors of the Fund who are not par ties to such agreement or interested persons (as defined","page_number":129,"box":{"x":69,"y":793,"width":839,"height":11}},{"id":"a247a192-829e-4f0f-9eea-9da6f8ebf6da","block_type":"box","text":"in the Investment Company Act) of any such par ty. Each Management Agreement automatically terminates on","page_number":129,"box":{"x":70,"y":808,"width":778,"height":11}},{"id":"327280b7-ea84-4727-bc5d-f6f7e8afaef1","block_type":"box","text":"assignment and may be terminated without penalty on 60 days’ written notice at the option of either par ty thereto or","page_number":129,"box":{"x":69,"y":823,"width":832,"height":12}},{"id":"3eb489f0-c962-4c4f-a14e-bc478efa7f3b","block_type":"box","text":"by the vote of the shareholders of the applicable Fund.","page_number":129,"box":{"x":69,"y":838,"width":388,"height":11}},{"id":"593fe18a-155b-41a6-8645-2e0c271afc0d","block_type":"box","text":"II-82","page_number":129,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"4f444fe0-4b0b-4a62-abd5-d1da7814e19b","block_type":"box","text":"NM1026U-6033063-129/246","page_number":129,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"a61674b1-c0be-4299-be2a-60fb42f729ed","block_type":"box","text":"Other Service Arrangements","page_number":130,"box":{"x":69,"y":45,"width":205,"height":11}},{"id":"1a9c4ebc-8cfe-4bcb-899a-9e8aaff14b0c","block_type":"box","text":"Administrative Services and Administrative Fee.","page_number":130,"box":{"x":101,"y":67,"width":338,"height":9}},{"id":"2d47069d-7d4f-4e3a-a358-a09793b9462c","block_type":"box","text":"Cer tain Funds have entered into an administration agreement","page_number":130,"box":{"x":446,"y":67,"width":439,"height":12}},{"id":"4b82b0b4-7321-47f6-afcd-09ee08dcec6e","block_type":"box","text":"(the “Administration Agreement”) with an administrator identified in the Fund’s Prospectus and Par t I of the Fund’s","page_number":130,"box":{"x":69,"y":82,"width":818,"height":12}},{"id":"bf611a9a-d0b9-4a7d-84f2-3c62fe47aef3","block_type":"box","text":"SAI (each an “Administrator”). For its services to a Fund, the Administrator receives monthly compensation at the","page_number":130,"box":{"x":69,"y":98,"width":808,"height":11}},{"id":"c41cc149-7e2a-4318-ace5-c62ca582969c","block_type":"box","text":"annual rate set for th in each applicable Fund’s Prospectus. For information regarding any administrative fees paid by","page_number":130,"box":{"x":69,"y":113,"width":833,"height":11}},{"id":"a40c465e-584f-4c83-9d2c-1b0f554646ff","block_type":"box","text":"your Fund to the Administrator for the periods indicated, see “Management, Advisory and Other Service","page_number":130,"box":{"x":68,"y":128,"width":738,"height":11}},{"id":"7b47d775-16ba-420b-828e-b28595396c45","block_type":"box","text":"Arrangements — Administration Agreement” or “Management and Advisory Arrangements,” as applicable, in Par t I of","page_number":130,"box":{"x":68,"y":143,"width":839,"height":11}},{"id":"033ba766-b36b-4e8a-906a-c4bf7c785071","block_type":"box","text":"that Fund’s SAI.","page_number":130,"box":{"x":68,"y":158,"width":113,"height":9}},{"id":"336ccace-8b2d-4be0-be6c-07642a6a115e","block_type":"box","text":"For Funds that have an Administrator, the Administration Agreement obligates the Administrator to provide","page_number":130,"box":{"x":102,"y":181,"width":755,"height":11}},{"id":"af1b5ab2-1066-4424-b7d6-95b26dfbcc17","block_type":"box","text":"cer tain administrative services to the Fund and to pay, or cause its affiliates to pay, for maintaining its staff and","page_number":130,"box":{"x":69,"y":196,"width":800,"height":11}},{"id":"6c0b09a6-2d30-4477-bea2-30b55c18125f","block_type":"box","text":"personnel and to provide office space, facilities and necessary personnel for the Fund. Each Administrator is also","page_number":130,"box":{"x":70,"y":211,"width":809,"height":11}},{"id":"8fe2f57e-c04d-425a-afca-b289606c17b3","block_type":"box","text":"obligated to pay, or cause its affiliates to pay, the fees of those officers and Directors of the Fund who are affiliated","page_number":130,"box":{"x":69,"y":226,"width":826,"height":11}},{"id":"491379d7-4c57-41b6-b2ed-8bbdf5dcd7fc","block_type":"box","text":"persons of the Administrator or any of its affiliates.","page_number":130,"box":{"x":70,"y":241,"width":362,"height":11}},{"id":"577d3700-3211-4018-ae6f-7dce09fc3ce3","block_type":"box","text":"Duration and Termination of Administration Agreement.","page_number":130,"box":{"x":102,"y":264,"width":390,"height":11}},{"id":"1a26d500-a003-45a9-8a7b-19e5e8aca43e","block_type":"box","text":"Unless earlier terminated as described below, each","page_number":130,"box":{"x":499,"y":264,"width":364,"height":10}},{"id":"12822738-6304-49bf-aa0d-e48a9f61ddbf","block_type":"box","text":"Administration Agreement with BlackRock will continue for an initial two year period and from year to year if approved","page_number":130,"box":{"x":68,"y":279,"width":832,"height":11}},{"id":"34148893-d192-45f9-a9cc-de8c49a6abaa","block_type":"box","text":"annually (a) by the Board of Directors of each applicable Fund or by a vote of a majority of the outstanding voting","page_number":130,"box":{"x":69,"y":294,"width":802,"height":11}},{"id":"fa77efc0-75ad-446c-8df7-7be623f1e5e9","block_type":"box","text":"securities of such Fund and (b) by a majority of the Directors of the Fund who are not par ties to such contract or","page_number":130,"box":{"x":69,"y":309,"width":800,"height":11}},{"id":"6810888f-4fe0-49ec-95f9-e78ab6a42a08","block_type":"box","text":"interested persons (as defined in the Investment Company Act) of any such par ty. Such contract is not assignable","page_number":130,"box":{"x":70,"y":324,"width":810,"height":12}},{"id":"ea522c8a-bbcb-480e-a4b7-90b041b42e0d","block_type":"box","text":"and may be terminated without penalty on written notice at the option of either par ty thereto or by the vote of the","page_number":130,"box":{"x":69,"y":339,"width":805,"height":12}},{"id":"035b5935-f6fc-4bb5-a098-f3e71daf5965","block_type":"box","text":"shareholders of the Fund.","page_number":130,"box":{"x":69,"y":355,"width":181,"height":9}},{"id":"86d55427-5fac-4317-a1bc-9489361086f4","block_type":"box","text":"Transfer Agency Services.","page_number":130,"box":{"x":103,"y":377,"width":180,"height":12}},{"id":"42a2bddd-3f1c-4662-89f2-1c6e7b924394","block_type":"box","text":"BNY Mellon Investment Servicing (US) Inc. (in this capacity, the “Transfer Agent”), a","page_number":130,"box":{"x":291,"y":377,"width":595,"height":12}},{"id":"25635c25-f5c7-4c6a-8c8c-c5c1b4c582ad","block_type":"box","text":"subsidiary of The Bank of New York Mellon Corporation, acts as each Fund’s Transfer Agent pursuant to a Transfer","page_number":130,"box":{"x":69,"y":392,"width":816,"height":12}},{"id":"30259837-bdb3-417c-a957-60592a01a665","block_type":"box","text":"Agency, Dividend Disbursing Agency and Shareholder Servicing Agency Agreement (the “Transfer Agency Agreement”)","page_number":130,"box":{"x":68,"y":407,"width":833,"height":12}},{"id":"f6533ca8-2f6c-468d-907d-2a9fc1024218","block_type":"box","text":"with the Funds. Pursuant to the Transfer Agency Agreement, the Transfer Agent is responsible for the issuance,","page_number":130,"box":{"x":68,"y":423,"width":792,"height":11}},{"id":"9b189877-b2f7-4731-9733-6682825852df","block_type":"box","text":"transfer and redemption of shares and the opening and maintenance of shareholder accounts. Each Fund pays the","page_number":130,"box":{"x":68,"y":438,"width":819,"height":11}},{"id":"b317fed3-0865-4938-b900-2cc461c75fce","block_type":"box","text":"Transfer Agent a fee for the services it receives based on the type of account and the level of services required. Each","page_number":130,"box":{"x":68,"y":453,"width":839,"height":11}},{"id":"096a83ed-510f-4fe8-af82-7a44cae702a0","block_type":"box","text":"Fund reimburses the Transfer Agent’s reasonable out-of-pocket expenses and pays a fee of 0.10% of account assets","page_number":130,"box":{"x":70,"y":468,"width":831,"height":11}},{"id":"56089267-5a50-4511-b62f-f68cc52d3eb3","block_type":"box","text":"for cer tain accounts that par ticipate in cer tain fee-based programs sponsored by the Manager or its affiliates. For","page_number":130,"box":{"x":68,"y":483,"width":813,"height":11}},{"id":"df544be4-4674-4e49-888c-7001471c175c","block_type":"box","text":"purposes of each Transfer Agency Agreement, the term “account” includes a shareholder account maintained directly","page_number":130,"box":{"x":70,"y":498,"width":836,"height":11}},{"id":"d67cfe0c-6438-4daa-ba4b-85a35032e847","block_type":"box","text":"by the Transfer Agent and any other account representing the beneficial interest of a person in the relevant share","page_number":130,"box":{"x":69,"y":513,"width":806,"height":12}},{"id":"3b202e74-c72f-4899-b9b4-1f8d03723b3b","block_type":"box","text":"class on a recordkeeping system.","page_number":130,"box":{"x":69,"y":529,"width":238,"height":11}},{"id":"b8f52e9a-f910-4d22-bf1b-83a9a35a90f8","block_type":"box","text":"Independent Registered Public Accounting Firm.","page_number":130,"box":{"x":102,"y":551,"width":338,"height":11}},{"id":"c0c9d27c-38a8-4429-8316-d6872855cc00","block_type":"box","text":"The Audit Committee of each Fund, the members of which are","page_number":130,"box":{"x":446,"y":551,"width":441,"height":11}},{"id":"8ccacee8-97f6-4ee6-b089-3311030ae318","block_type":"box","text":"non-interested Directors of the Fund, has selected an independent registered public accounting firm for that Fund that","page_number":130,"box":{"x":69,"y":566,"width":840,"height":11}},{"id":"ee2b2324-ff67-4c69-9904-dc9efa8c8b9d","block_type":"box","text":"audits the Fund’s financial statements. Please see the inside back cover page of your Fund’s Prospectus and Par t I","page_number":130,"box":{"x":69,"y":581,"width":823,"height":12}},{"id":"de1b119f-6f38-4e0a-82b7-cc49bb1c38d5","block_type":"box","text":"of this SAI for information on your Fund’s independent registered public accounting firm.","page_number":130,"box":{"x":69,"y":596,"width":627,"height":12}},{"id":"e87cd6e4-fad2-4fdb-a771-bb00979149e0","block_type":"box","text":"Custodian Services.","page_number":130,"box":{"x":102,"y":619,"width":141,"height":9}},{"id":"16e20b5e-ffc8-43f3-ac35-e990da03bbe9","block_type":"box","text":"The name and address of the custodian (the “Custodian”) of each Fund are provided on the","page_number":130,"box":{"x":249,"y":619,"width":654,"height":11}},{"id":"42310ea0-3f43-4e9c-8e7f-899ff456de74","block_type":"box","text":"inside back cover page of the Fund’s Prospectus. The Custodian is responsible for safeguarding and controlling the","page_number":130,"box":{"x":70,"y":634,"width":820,"height":12}},{"id":"0daaa8f3-d646-457b-b56f-fe1a3a27af43","block_type":"box","text":"Fund’s cash and securities, handling the receipt and delivery of securities and collecting interest and dividends on","page_number":130,"box":{"x":70,"y":649,"width":814,"height":12}},{"id":"010c4dd4-ad4f-4264-82d8-fef68b8a8cb4","block_type":"box","text":"the Fund’s investments. The Custodian is authorized to establish separate accounts in foreign currencies and to","page_number":130,"box":{"x":68,"y":664,"width":802,"height":12}},{"id":"76f48447-8f98-4baf-b123-c2422fa97a26","block_type":"box","text":"cause foreign securities owned by the Fund to be held in its offices outside the United States and with cer tain foreign","page_number":130,"box":{"x":69,"y":680,"width":839,"height":11}},{"id":"ada9392a-f7c2-4f9f-895c-022318d0e4f8","block_type":"box","text":"banks and securities depositories. A Fund also may use special purpose custodian banks from time to time for","page_number":130,"box":{"x":69,"y":695,"width":792,"height":11}},{"id":"9d7e4cbe-7514-46e6-af8a-7c09c4270e59","block_type":"box","text":"cer tain assets.","page_number":130,"box":{"x":69,"y":710,"width":106,"height":9}},{"id":"ef487380-9ec1-462f-93cc-ffda605a074b","block_type":"box","text":"For cer tain Feeder Funds, the Custodian also acts as the custodian of the Master Por tfolio’s assets.","page_number":130,"box":{"x":102,"y":732,"width":716,"height":11}},{"id":"e2213493-c00a-47cb-a463-110977816d8d","block_type":"box","text":"Generally, overdraft charges, if any, are treated as interest expense. 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BlackRock, its subsidiaries and their","page_number":136,"box":{"x":102,"y":775,"width":731,"height":12}},{"id":"563dc929-4d85-4bc6-aa88-56b0656e78ae","block_type":"box","text":"respective directors, officers and employees, including the business units or entities and personnel who may be","page_number":136,"box":{"x":69,"y":790,"width":799,"height":12}},{"id":"78b61daf-a518-48c1-85c2-b480a603e4d9","block_type":"box","text":"involved in the investment activities and business operations of a Fund, are engaged worldwide in businesses,","page_number":136,"box":{"x":70,"y":806,"width":786,"height":11}},{"id":"01f3622b-3979-458b-ab6c-f9c3edc2f484","block_type":"box","text":"including managing equities, fixed income securities, cash and alternative investments, and other financial services,","page_number":136,"box":{"x":70,"y":821,"width":829,"height":11}},{"id":"7cf143ad-7912-4557-b0d3-92a1b8dfc4f6","block_type":"box","text":"and have interests other than that of managing the Funds. These are considerations of which investors in a Fund","page_number":136,"box":{"x":69,"y":836,"width":804,"height":11}},{"id":"ac1e2a7f-08ac-4dc1-8f32-afeb8381fc96","block_type":"box","text":"should be aware, and which may cause conflicts of interest that could disadvantage a Fund and its shareholders.","page_number":136,"box":{"x":69,"y":851,"width":806,"height":11}},{"id":"83393182-8a99-43d3-99ee-6f5b6e9a354c","block_type":"box","text":"These businesses and interests include potential multiple advisory, transactional, financial and other","page_number":136,"box":{"x":101,"y":874,"width":722,"height":11}},{"id":"6c507ba1-c85c-497f-920e-a6657049674c","block_type":"box","text":"relationships with, or interests in companies and interests in securities or other instruments that may be purchased","page_number":136,"box":{"x":69,"y":889,"width":827,"height":11}},{"id":"95d91f5a-5c08-4efb-a148-36270d66b637","block_type":"box","text":"or sold by a Fund.","page_number":136,"box":{"x":69,"y":904,"width":125,"height":11}},{"id":"e1a8afd6-debe-42ce-87ec-571da9e9c00e","block_type":"box","text":"II-89","page_number":136,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"dd6416f5-0f01-4d0a-a561-7f73fd8c1139","block_type":"box","text":"NM1026U-6033063-136/246","page_number":136,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"a129221f-d001-41a3-aed4-c136afa5e75b","block_type":"box","text":"BlackRock may have proprietary interests in, and may manage or advise with respect to, accounts or funds","page_number":137,"box":{"x":102,"y":45,"width":762,"height":11}},{"id":"bce76561-507b-494d-9846-25b883a70f17","block_type":"box","text":"(including separate accounts and other funds and collective investment vehicles) that have investment objectives","page_number":137,"box":{"x":69,"y":60,"width":806,"height":11}},{"id":"29557f32-ac71-4ead-8ef2-786db9920dc8","block_type":"box","text":"identical or similar to those of a Fund and/or that engage in transactions in the same types of securities, currencies","page_number":137,"box":{"x":70,"y":75,"width":828,"height":11}},{"id":"2ae3b9e9-c93d-4ff5-9ebd-2318156de567","block_type":"box","text":"and instruments as the Fund. Such other funds or accounts may offer exposure to strategies that are identical or","page_number":137,"box":{"x":69,"y":90,"width":808,"height":11}},{"id":"d72fc934-620d-4655-a4df-ede8c063c97e","block_type":"box","text":"substantially similar to those of a Fund but with different fees and expenses, governance and structures, and/or","page_number":137,"box":{"x":69,"y":105,"width":803,"height":11}},{"id":"e6e154dd-9fc8-4a02-b563-d3b076f986a2","block_type":"box","text":"services provided by BlackRock","page_number":137,"box":{"x":69,"y":120,"width":224,"height":11}},{"id":"f2dc8a55-59e1-4873-aa34-c7eb1a00e602","block_type":"box","text":".","page_number":137,"box":{"x":295,"y":128,"width":2,"height":1}},{"id":"8f930b49-0158-4388-9136-5cf05cdbec30","block_type":"box","text":"BlackRock is also a major par ticipant in the global currency, equities, swap and fixed","page_number":137,"box":{"x":304,"y":120,"width":603,"height":12}},{"id":"84d86ba6-ae08-4736-9413-ba0e2bd0c4b6","block_type":"box","text":"income markets, in each case, for the accounts of clients and, in some cases, on a proprietary basis. As such,","page_number":137,"box":{"x":70,"y":135,"width":791,"height":11}},{"id":"c893a039-15e2-4e8d-994a-3a57d1a9fa10","block_type":"box","text":"BlackRock is or may be actively engaged in transactions in the same securities, currencies, and instruments in which","page_number":137,"box":{"x":70,"y":151,"width":835,"height":11}},{"id":"3187bc93-238a-4bdb-81fe-3359c8f81253","block_type":"box","text":"a Fund invests.","page_number":137,"box":{"x":69,"y":166,"width":106,"height":9}},{"id":"7f59c9ed-d747-4600-a5b5-97e9c9e989c5","block_type":"box","text":"Such activities could affect the prices and availability of the securities, currencies, and instruments in which a","page_number":137,"box":{"x":102,"y":188,"width":785,"height":11}},{"id":"68445fb5-40a2-4703-bd3e-4866eb304a91","block_type":"box","text":"Fund invests, which could have an adverse impact on a Fund’s per formance. Such transactions, par ticularly in","page_number":137,"box":{"x":70,"y":203,"width":785,"height":12}},{"id":"10f182f7-23a3-4955-9f73-3c7a7ee73e83","block_type":"box","text":"respect of most proprietary accounts or client accounts, will be executed independently of a Fund’s transactions and","page_number":137,"box":{"x":69,"y":218,"width":832,"height":12}},{"id":"5af4abaf-9adc-4aa0-a4a8-306d84ad3b3b","block_type":"box","text":"thus at prices or rates that may be more or less favorable than those obtained by the Fund.","page_number":137,"box":{"x":68,"y":234,"width":652,"height":11}},{"id":"ab6639a9-65f4-4e79-9ad1-c8ad915fff84","block_type":"box","text":"In addition, the por tfolio holdings of cer tain BlackRock-advised investment vehicles managed in an identical or","page_number":137,"box":{"x":102,"y":256,"width":787,"height":12}},{"id":"430cebeb-8b56-4856-b426-6e7c6a4d1604","block_type":"box","text":"substantially similar manner as cer tain Funds are made publicly available on a more timely basis than the applicable","page_number":137,"box":{"x":69,"y":272,"width":832,"height":11}},{"id":"384eb1f0-e4c8-4ec1-963e-d2f8d0e79028","block_type":"box","text":"Fund. In some cases, such por tfolio holdings are made publicly available on a daily basis. While not expected, it is","page_number":137,"box":{"x":70,"y":286,"width":816,"height":12}},{"id":"231da815-7a4a-40cd-8b48-3b6e79dfdec3","block_type":"box","text":"possible that a recipient of por tfolio holdings information for such an investment vehicle could cause harm to a Fund","page_number":137,"box":{"x":70,"y":302,"width":831,"height":11}},{"id":"93b2cadb-d8cd-4911-a5ea-e4d03945cf07","block_type":"box","text":"that is managed in an identical or substantially similar manner, including by trading ahead of or against such Fund","page_number":137,"box":{"x":68,"y":317,"width":813,"height":11}},{"id":"e13b2358-6f9b-4aff-aa27-67d926815544","block_type":"box","text":"based on the information received.","page_number":137,"box":{"x":69,"y":332,"width":247,"height":9}},{"id":"1fcc6237-b286-4e44-af39-3c5770d99be0","block_type":"box","text":"When BlackRock seeks to purchase or sell the same assets for client accounts, including a Fund, the assets","page_number":137,"box":{"x":101,"y":355,"width":777,"height":11}},{"id":"55d8dd5a-719d-4d0c-9d1b-308f3694091c","block_type":"box","text":"actually purchased or sold may be allocated among the accounts on a basis determined in its good faith discretion to","page_number":137,"box":{"x":69,"y":370,"width":838,"height":11}},{"id":"46c8a500-3181-46f8-beb7-7955d79b00e0","block_type":"box","text":"be equitable. In some cases, this system may adversely affect the size or price of the assets purchased or sold for a","page_number":137,"box":{"x":69,"y":385,"width":835,"height":11}},{"id":"c0b0d3f6-4a38-41eb-badd-d91cde1fbf3c","block_type":"box","text":"Fund. In addition, transactions in investments by one or more other accounts managed by BlackRock may have the","page_number":137,"box":{"x":70,"y":400,"width":817,"height":11}},{"id":"7bb99ac2-3af5-48c5-963b-abce570293f1","block_type":"box","text":"effect of diluting or otherwise disadvantaging the values, prices or investment strategies of a Fund, par ticularly, but","page_number":137,"box":{"x":69,"y":415,"width":823,"height":11}},{"id":"a8fe8288-2459-47b3-8d04-01b40575397f","block_type":"box","text":"not limited to, with respect to small capitalization, emerging market or less liquid strategies. This may occur with","page_number":137,"box":{"x":69,"y":430,"width":803,"height":11}},{"id":"09e5cb65-7e4e-4874-b5b2-6086a7f7f574","block_type":"box","text":"respect to BlackRock-advised accounts when investment decisions regarding a Fund are based on research or other","page_number":137,"box":{"x":69,"y":446,"width":827,"height":11}},{"id":"67f788d8-7997-49b2-84fc-48b3c5b837d0","block_type":"box","text":"information that is also used to suppor t decisions for other accounts. When BlackRock implements a por tfolio","page_number":137,"box":{"x":70,"y":460,"width":785,"height":11}},{"id":"bca80565-ef99-4fb3-ba0b-1721769698eb","block_type":"box","text":"decision or strategy on behalf of another account ahead of, or contemporaneously with, similar decisions or","page_number":137,"box":{"x":69,"y":475,"width":767,"height":12}},{"id":"5e6eb431-7850-4023-8cbb-4c8e2677d456","block_type":"box","text":"strategies for a Fund, market impact, liquidity constraints, or other factors could result in the Fund receiving less","page_number":137,"box":{"x":69,"y":491,"width":802,"height":11}},{"id":"e546d31d-9d4d-4be7-932b-03311f3bd947","block_type":"box","text":"favorable trading results and the costs of implementing such decisions or strategies could be increased or the Fund","page_number":137,"box":{"x":68,"y":506,"width":827,"height":11}},{"id":"7df8ed0f-3f11-48c9-b68e-9fb2e712fed1","block_type":"box","text":"could otherwise be disadvantaged. BlackRock may, in cer tain cases, elect to implement internal policies and","page_number":137,"box":{"x":69,"y":521,"width":776,"height":11}},{"id":"1a4108ab-cec9-40da-9059-6a90f726a589","block_type":"box","text":"procedures designed to limit such consequences, which may cause a Fund to be unable to engage in cer tain","page_number":137,"box":{"x":70,"y":536,"width":774,"height":11}},{"id":"b480e6f5-7d7b-434d-92e9-3e3c541765db","block_type":"box","text":"activities, including purchasing or disposing of securities, when it might otherwise be desirable for it to do so.","page_number":137,"box":{"x":69,"y":551,"width":781,"height":11}},{"id":"b1d1983b-cb81-4404-a4a5-93f1cdaeb9fe","block_type":"box","text":"Conflicts may also arise because por tfolio decisions regarding a Fund may benefit other accounts managed by","page_number":137,"box":{"x":69,"y":566,"width":787,"height":11}},{"id":"234da725-a687-4cf6-a8b2-86fc7d1c2b41","block_type":"box","text":"BlackRock. For example, the sale of a long position or establishment of a shor t position by a Fund may impair the","page_number":137,"box":{"x":70,"y":581,"width":809,"height":12}},{"id":"28281d2e-25d4-4a2f-bbed-20f02b1df1bc","block_type":"box","text":"price of the same security sold shor t by (and therefore benefit) BlackRock or its other accounts or funds, and the","page_number":137,"box":{"x":70,"y":596,"width":805,"height":12}},{"id":"522cef71-fee4-46b6-bcd7-1fe5e070a0ee","block_type":"box","text":"purchase of a security or covering of a shor t position in a security by a Fund may increase the price of the same","page_number":137,"box":{"x":70,"y":612,"width":797,"height":11}},{"id":"18c1c96f-eab9-487e-b8c9-82e4ae1679e9","block_type":"box","text":"security held by (and therefore benefit) BlackRock or its other accounts or funds.","page_number":137,"box":{"x":69,"y":627,"width":573,"height":11}},{"id":"e6254129-f43c-4ca3-978b-e06fb5a710a7","block_type":"box","text":"BlackRock, on behalf of other client accounts, on the one hand, and a Fund, on the other hand, may invest in or","page_number":137,"box":{"x":102,"y":649,"width":797,"height":12}},{"id":"46c90bef-6278-4c8d-bb11-972d92ab4b8f","block_type":"box","text":"extend credit to different par ts of the capital structure of a single issuer. BlackRock may pursue rights, provide","page_number":137,"box":{"x":69,"y":664,"width":791,"height":12}},{"id":"40b63fa3-3775-4aec-a94f-90d4c2912193","block_type":"box","text":"advice or engage in other activities, or refrain from pursuing rights, providing advice or engaging in other activities, on","page_number":137,"box":{"x":69,"y":680,"width":835,"height":11}},{"id":"fc275ad8-2b87-45e2-88e0-1f75806bf50f","block_type":"box","text":"behalf of other clients with respect to an issuer in which a Fund has invested, and such actions (or refraining from","page_number":137,"box":{"x":69,"y":695,"width":812,"height":11}},{"id":"9e3d7333-7238-4c14-a0a6-b17c362b3bd0","block_type":"box","text":"action) may have a material adverse effect on the Fund. In situations in which clients of BlackRock (including the","page_number":137,"box":{"x":69,"y":710,"width":803,"height":11}},{"id":"050308f6-57ae-4972-85bd-17ab7f1a96d0","block_type":"box","text":"Funds) hold positions in multiple par ts of the capital structure of an issuer, BlackRock may not pursue cer tain","page_number":137,"box":{"x":70,"y":725,"width":783,"height":11}},{"id":"c1248fac-2bf4-41b2-9744-ded3cf739162","block_type":"box","text":"actions or remedies that may be available to a Fund, as a result of legal and regulatory requirements or otherwise.","page_number":137,"box":{"x":69,"y":740,"width":818,"height":11}},{"id":"0035c1a4-9f22-45a9-b714-77e1bf11bcb2","block_type":"box","text":"BlackRock addresses these and other potential conflicts of interest based on the facts and circumstances of","page_number":137,"box":{"x":70,"y":755,"width":777,"height":11}},{"id":"73cbdad5-2922-436c-b11f-d790b5c26987","block_type":"box","text":"par ticular situations. For example, BlackRock may determine to rely on information barriers between different","page_number":137,"box":{"x":70,"y":770,"width":780,"height":11}},{"id":"77b5cc39-f177-49de-b87d-1d892c28f12b","block_type":"box","text":"business units or por tfolio management teams. BlackRock may also determine to rely on the actions of similarly","page_number":137,"box":{"x":69,"y":785,"width":802,"height":12}},{"id":"cf9057fd-7ef6-4167-b64d-1621fb4f8c11","block_type":"box","text":"situated holders of loans or securities rather than, or in connection with, taking such actions itself on behalf of the","page_number":137,"box":{"x":69,"y":801,"width":817,"height":11}},{"id":"87c187b9-a7f3-469d-a47a-36f7fb4af001","block_type":"box","text":"Funds.","page_number":137,"box":{"x":70,"y":816,"width":44,"height":9}},{"id":"a1d76dc6-e70b-4a3e-9c5d-866ac072b561","block_type":"box","text":"In addition, to the extent permitted by applicable law, cer tain Funds may invest their assets in other funds","page_number":137,"box":{"x":102,"y":838,"width":755,"height":11}},{"id":"b548b8d8-b389-432a-88b4-a802c3dbb2ae","block_type":"box","text":"advised by BlackRock, including funds that are managed by one or more of the same por tfolio managers, which could","page_number":137,"box":{"x":69,"y":853,"width":836,"height":12}},{"id":"62115a8b-8fb8-40e3-97ac-87360b3e61e6","block_type":"box","text":"result in conflicts of interest relating to asset allocation, timing of Fund purchases and redemptions, and increased","page_number":137,"box":{"x":69,"y":869,"width":821,"height":11}},{"id":"63922916-18b0-40ff-9e96-e406d188de7f","block_type":"box","text":"remuneration and profitability for BlackRock and/or its personnel, including por tfolio managers.","page_number":137,"box":{"x":69,"y":884,"width":679,"height":11}},{"id":"c03665ed-097b-485c-8eb9-d0b48977b2fb","block_type":"box","text":"II-90","page_number":137,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"9ad60b25-57da-4ac5-b611-1d80dc51baea","block_type":"box","text":"NM1026U-6033063-137/246","page_number":137,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"e586fdd9-05b3-4fa9-86ec-ee899c19048d","block_type":"box","text":"Third par ties, including service providers to BlackRock or the Fund, may sponsor events (including, but not","page_number":138,"box":{"x":101,"y":45,"width":760,"height":11}},{"id":"e9198375-6fd6-4957-855f-08ff6ecdf7dd","block_type":"box","text":"limited to, marketing and promotional activities and presentations, educational training programs and conferences)","page_number":138,"box":{"x":70,"y":60,"width":818,"height":11}},{"id":"cef9ff3f-801b-4cf4-990c-3aef64944b5a","block_type":"box","text":"for registered representatives, other professionals and individual investors. There is a potential conflict of interest as","page_number":138,"box":{"x":68,"y":75,"width":836,"height":11}},{"id":"c7c077d8-da74-48d5-aee3-46173a95a061","block_type":"box","text":"such sponsorships may defray the costs of such activities to BlackRock, and may provide an incentive to BlackRock","page_number":138,"box":{"x":69,"y":90,"width":825,"height":11}},{"id":"02ac9dc8-2a72-46bc-a65a-a8707ad6b5dc","block_type":"box","text":"to retain such third par ties to provide services to the Fund.","page_number":138,"box":{"x":68,"y":105,"width":421,"height":11}},{"id":"37b373eb-9a18-46c1-b0f1-ded96a2c20bf","block_type":"box","text":"In cer tain circumstances, BlackRock, on behalf of the Funds, may seek to buy from or sell securities to another","page_number":138,"box":{"x":102,"y":128,"width":794,"height":11}},{"id":"a7c33ae4-38d6-464e-92fb-6b77d7ba1bd3","block_type":"box","text":"fund or account advised by BlackRock. BlackRock may (but is not required to) effect purchases and sales between","page_number":138,"box":{"x":68,"y":143,"width":817,"height":11}},{"id":"8aae78cd-3c33-49a8-8e1c-779c469c81d8","block_type":"box","text":"BlackRock clients (“cross trades”), including the Funds, if BlackRock believes such transactions are appropriate","page_number":138,"box":{"x":70,"y":158,"width":797,"height":11}},{"id":"2c4a5b4d-68ca-413f-8d1f-10dd987eb096","block_type":"box","text":"based on each par ty’s investment objectives and guidelines, subject to applicable law and regulation. There may be","page_number":138,"box":{"x":69,"y":173,"width":826,"height":11}},{"id":"7562b18c-9547-4ab5-9a5c-9b20e6f58339","block_type":"box","text":"potential conflicts of interest or regulatory issues relating to these transactions which could limit BlackRock’s","page_number":138,"box":{"x":70,"y":188,"width":780,"height":12}},{"id":"a0c64d38-d56c-497b-8e68-7dcfff889a39","block_type":"box","text":"decision to engage in these transactions for the Funds. BlackRock may have a potentially conflicting division of","page_number":138,"box":{"x":69,"y":203,"width":791,"height":12}},{"id":"d80fb2d0-0912-48e5-bb36-03b99d418b91","block_type":"box","text":"loyalties and responsibilities to the par ties in such transactions.","page_number":138,"box":{"x":70,"y":219,"width":457,"height":11}},{"id":"e70a7fc8-6c46-4f4b-8715-dc43c54bf9ba","block_type":"box","text":"BlackRock and its clients may pursue or enforce rights with respect to an issuer in which a Fund has invested,","page_number":138,"box":{"x":102,"y":241,"width":784,"height":11}},{"id":"aaaf3f7a-3fd3-4606-b39d-c039cda98f31","block_type":"box","text":"and those activities may have an adverse effect on the Fund. As a result, prices, availability, liquidity and terms of the","page_number":138,"box":{"x":69,"y":256,"width":840,"height":11}},{"id":"e9fdb7f9-b6b1-4f8d-bddd-96e945059776","block_type":"box","text":"Fund’s investments may be negatively impacted by the activities of BlackRock or its clients, and transactions for the","page_number":138,"box":{"x":70,"y":271,"width":827,"height":12}},{"id":"4925d9d2-2361-41f5-a62c-8aff600dd108","block_type":"box","text":"Fund may be impaired or effected at prices or terms that may be less favorable than would otherwise have been the","page_number":138,"box":{"x":70,"y":286,"width":828,"height":12}},{"id":"5fb913ec-270e-4657-8d99-2e18de934f2d","block_type":"box","text":"case.","page_number":138,"box":{"x":69,"y":304,"width":37,"height":7}},{"id":"0ceb2b66-a025-476e-9e12-1bf26d51a4c7","block_type":"box","text":"The results of a Fund’s investment activities may differ significantly from the results achieved by BlackRock for","page_number":138,"box":{"x":101,"y":324,"width":791,"height":12}},{"id":"c5829bd3-0ae0-42c3-b5ca-4f240b162169","block_type":"box","text":"its proprietary accounts or other accounts (including investment companies or collective investment vehicles) that it","page_number":138,"box":{"x":70,"y":340,"width":824,"height":11}},{"id":"133cd08f-634c-4bda-823b-757cb79f8f53","block_type":"box","text":"manages or advises. It is possible that one or more accounts managed or advised by BlackRock and such other","page_number":138,"box":{"x":69,"y":355,"width":798,"height":11}},{"id":"d13007fc-24ae-41a8-84f9-af930ad59fbb","block_type":"box","text":"accounts will achieve investment results that are substantially more or less favorable than the results achieved by a","page_number":138,"box":{"x":69,"y":370,"width":828,"height":11}},{"id":"6cafee69-dc58-4ece-b8be-caba0e6a5b42","block_type":"box","text":"Fund. Moreover, it is possible that a Fund will sustain losses during periods in which one or more proprietary or other","page_number":138,"box":{"x":70,"y":385,"width":835,"height":11}},{"id":"55449260-b86e-45f3-8140-8118e844c11c","block_type":"box","text":"accounts managed or advised by BlackRock achieve significant profits. The opposite result is also possible.","page_number":138,"box":{"x":69,"y":400,"width":767,"height":11}},{"id":"e3c4424f-38ab-494f-8ac7-24791b3f7a7e","block_type":"box","text":"From time to time, a Fund may be restricted from purchasing or selling securities, or from engaging in other","page_number":138,"box":{"x":102,"y":423,"width":766,"height":11}},{"id":"b965bfbf-6b88-4761-b85b-dbdbede11a31","block_type":"box","text":"investment activities because of regulatory, legal or contractual requirements applicable to BlackRock or other","page_number":138,"box":{"x":70,"y":438,"width":786,"height":11}},{"id":"4c291e36-a197-4678-a9c5-5771498f418f","block_type":"box","text":"accounts managed or advised by BlackRock, and/or the internal policies of BlackRock designed to comply with such","page_number":138,"box":{"x":69,"y":453,"width":828,"height":11}},{"id":"39c42ef6-00e0-4750-be82-9639e22c84f8","block_type":"box","text":"requirements. As a result, there may be periods, for example, when BlackRock will not initiate or recommend cer tain","page_number":138,"box":{"x":69,"y":468,"width":831,"height":11}},{"id":"0dd07958-41b0-4eae-9fc6-d3bb92832981","block_type":"box","text":"types of transactions in cer tain securities or instruments with respect to which BlackRock is per forming services or","page_number":138,"box":{"x":68,"y":483,"width":825,"height":11}},{"id":"f25ac9ba-9d04-4e6c-99cc-81f7d80eaefd","block_type":"box","text":"when position limits have been reached. For example, the investment activities of BlackRock for its proprietary","page_number":138,"box":{"x":68,"y":498,"width":790,"height":11}},{"id":"3fa4b26f-680e-4f16-b301-b6d85934b6c2","block_type":"box","text":"accounts and accounts under its management may limit the investment oppor tunities for a Fund in cer tain emerging","page_number":138,"box":{"x":69,"y":513,"width":830,"height":12}},{"id":"21d8d1ce-4f40-4eec-a7f7-dfcc83c5b094","block_type":"box","text":"and other markets in which limitations are imposed upon the amount of investment, in the aggregate or in individual","page_number":138,"box":{"x":69,"y":528,"width":827,"height":12}},{"id":"4fefd887-84ac-428e-a912-7c2158c8b44f","block_type":"box","text":"issuers, by affiliated foreign investors.","page_number":138,"box":{"x":70,"y":543,"width":271,"height":12}},{"id":"4564603f-465b-403a-aa05-095291da0815","block_type":"box","text":"In connection with its management of a Fund, BlackRock may have access to cer tain fundamental analysis and","page_number":138,"box":{"x":102,"y":566,"width":792,"height":11}},{"id":"8554667e-57d0-4972-8500-a6216e8c5df5","block_type":"box","text":"proprietary technical models developed by BlackRock. BlackRock will not be under any obligation, however, to effect","page_number":138,"box":{"x":70,"y":581,"width":826,"height":12}},{"id":"12344da4-ad01-4532-a0fb-0316a8fde197","block_type":"box","text":"transactions on behalf of a Fund in accordance with such analysis and models. In addition, BlackRock will not have","page_number":138,"box":{"x":68,"y":596,"width":821,"height":12}},{"id":"80ff4725-d7c2-4e67-9018-cdef7859edc7","block_type":"box","text":"any obligation to make available any information regarding its proprietary activities or strategies, or the activities or","page_number":138,"box":{"x":69,"y":612,"width":821,"height":11}},{"id":"32cf8e5b-1b04-4689-9410-9171341b9413","block_type":"box","text":"strategies used for other accounts managed by them, for the benefit of the management of a Fund and it is not","page_number":138,"box":{"x":69,"y":627,"width":793,"height":11}},{"id":"f4429a06-df17-495b-bd51-fa4c33150ab2","block_type":"box","text":"anticipated that BlackRock will have access to such information for the purpose of managing the Fund. The","page_number":138,"box":{"x":69,"y":642,"width":762,"height":11}},{"id":"a1691de8-b752-4eb4-8f31-b6bff68cbf1d","block_type":"box","text":"proprietary activities or por tfolio strategies of BlackRock, or the activities or strategies used for accounts managed by","page_number":138,"box":{"x":70,"y":657,"width":839,"height":11}},{"id":"076c416a-055a-4924-85de-dc7c86187b66","block_type":"box","text":"BlackRock or other client accounts could conflict with the transactions and strategies employed by BlackRock in","page_number":138,"box":{"x":70,"y":672,"width":795,"height":11}},{"id":"8cf11b0e-508f-44e3-b33b-7ba3729890cc","block_type":"box","text":"managing a Fund.","page_number":138,"box":{"x":69,"y":687,"width":124,"height":11}},{"id":"9113c497-6250-478a-a0dc-5b6f08d8d71c","block_type":"box","text":"The Funds may be included in investment models developed by BlackRock for use by clients and financial","page_number":138,"box":{"x":101,"y":710,"width":751,"height":11}},{"id":"fd7996a6-2bb6-4c5d-a153-d1191c2f68f3","block_type":"box","text":"advisors. To the extent clients invest in these investment models and increase the assets under management of the","page_number":138,"box":{"x":69,"y":725,"width":830,"height":11}},{"id":"9bd51f8a-119e-429b-b07e-b8e6872c494f","block_type":"box","text":"Funds, the investment management fee amounts paid by the Funds to BlackRock may also increase. The net asset","page_number":138,"box":{"x":70,"y":740,"width":820,"height":11}},{"id":"a9dbcee0-3862-4610-a683-cfc753d8da09","block_type":"box","text":"value and liquidity of a Fund may be impacted by purchases and sales of the Fund by model-driven investment","page_number":138,"box":{"x":68,"y":755,"width":785,"height":11}},{"id":"a21a8710-e7b2-4e34-9adb-21a722769b3a","block_type":"box","text":"por tfolios, as well as by BlackRock itself and by its advisory clients.","page_number":138,"box":{"x":70,"y":770,"width":481,"height":11}},{"id":"9194cffe-4671-43da-b7fb-b3a88531c85c","block_type":"box","text":"In addition, cer tain principals and cer tain employees of a Fund’s investment adviser are also principals or","page_number":138,"box":{"x":102,"y":793,"width":754,"height":11}},{"id":"9f41a736-57c4-4c7a-923b-ed573efe6538","block_type":"box","text":"employees of other business units or entities within BlackRock. As a result, these principals and employees may","page_number":138,"box":{"x":69,"y":808,"width":804,"height":11}},{"id":"698c72ab-4b5a-49f7-af7a-7f783f687822","block_type":"box","text":"have obligations to such other business units or entities or their clients and such obligations to other business units","page_number":138,"box":{"x":69,"y":823,"width":831,"height":12}},{"id":"28eaadf7-d624-4ab9-868d-5300e2678ed6","block_type":"box","text":"or entities or their clients may be a consideration of which investors in a Fund should be aware.","page_number":138,"box":{"x":69,"y":838,"width":680,"height":11}},{"id":"3a92134f-57eb-4906-b0f3-6f36b0cbad2d","block_type":"box","text":"BlackRock may enter into transactions and invest in securities, instruments and currencies on behalf of a Fund","page_number":138,"box":{"x":102,"y":861,"width":791,"height":11}},{"id":"b38187e9-dae5-4092-8ff5-40227a1dbcad","block_type":"box","text":"in which clients of BlackRock, or, to the extent permitted by the Commission and applicable law, BlackRock, serves","page_number":138,"box":{"x":70,"y":876,"width":820,"height":11}},{"id":"7d720c2f-c4ef-44b5-82cc-7e3b6eecbc81","block_type":"box","text":"as the counterpar ty, principal or issuer. In such cases, such par ty’s interests in the transaction will be adverse to the","page_number":138,"box":{"x":69,"y":891,"width":837,"height":11}},{"id":"203aca61-7c7a-4bdd-81b6-9360e288a748","block_type":"box","text":"interests of the Fund, and such par ty may have no incentive to assure that the Fund obtains the best possible prices","page_number":138,"box":{"x":70,"y":906,"width":832,"height":12}},{"id":"7c1b548a-1878-4125-8a89-20f09fe198aa","block_type":"box","text":"II-91","page_number":138,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"d444cb4a-e8fa-44de-b6d3-6aac09011096","block_type":"box","text":"NM1026U-6033063-138/246","page_number":138,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"55a96cbf-3e7a-4afa-984d-d11470486f11","block_type":"box","text":"or terms in connection with the transactions. In addition, the purchase, holding and sale of such investments by a","page_number":139,"box":{"x":69,"y":45,"width":813,"height":11}},{"id":"626606ca-8d2f-48d7-a59a-41e4c14c934e","block_type":"box","text":"Fund may enhance the profitability of BlackRock.","page_number":139,"box":{"x":70,"y":60,"width":344,"height":11}},{"id":"b11b8f4d-75d9-4fe2-bb45-458044eb51b3","block_type":"box","text":"BlackRock may also create, write or issue derivatives for clients, the underlying securities, currencies or","page_number":139,"box":{"x":102,"y":82,"width":741,"height":12}},{"id":"eeac5e87-bf3e-4067-831a-1f8766855923","block_type":"box","text":"instruments of which may be those in which a Fund invests or which may be based on the per formance of the Fund.","page_number":139,"box":{"x":70,"y":98,"width":824,"height":11}},{"id":"289a218a-6513-4ef9-b62c-7ccf79ba7a7d","block_type":"box","text":"Additionally, an affiliate of BlackRock will create, write or issue options, which may be based on the per formance of","page_number":139,"box":{"x":68,"y":113,"width":825,"height":11}},{"id":"d897dde9-fbba-4f15-98db-f508111d47ea","block_type":"box","text":"cer tain Funds. BlackRock has entered into an arrangement with Markit Indices Limited, the index provider for","page_number":139,"box":{"x":69,"y":128,"width":777,"height":11}},{"id":"fa4bbfbc-e1ed-41e0-b720-85d28cbc59cf","block_type":"box","text":"underlying fixed-income indexes used by cer tain iShares ETFs, related to derivative fixed-income products that are","page_number":139,"box":{"x":69,"y":143,"width":810,"height":11}},{"id":"f21f0279-d466-4014-83b5-4b8171c80859","block_type":"box","text":"based on such iShares ETFs. Trading activity in these derivative products could also potentially lead to greater","page_number":139,"box":{"x":69,"y":158,"width":784,"height":11}},{"id":"c3bd158b-5723-4802-8988-f3c226d65d94","block_type":"box","text":"liquidity for such products, increased purchase activity with respect to these iShares ETFs and increased assets","page_number":139,"box":{"x":70,"y":173,"width":798,"height":11}},{"id":"0c1ec85f-3d9e-4560-b7a4-c159384eaed6","block_type":"box","text":"under management for BlackRock.","page_number":139,"box":{"x":69,"y":188,"width":243,"height":12}},{"id":"45e59284-ba90-4458-bbba-0f48b697a30d","block_type":"box","text":"A Fund may, subject to applicable law, purchase investments that are the subject of an underwriting or other","page_number":139,"box":{"x":101,"y":211,"width":773,"height":11}},{"id":"fac7e24e-7346-483c-821a-7d10171f280d","block_type":"box","text":"distribution by BlackRock and may also enter into transactions with other clients of BlackRock where such other","page_number":139,"box":{"x":69,"y":226,"width":797,"height":11}},{"id":"b0c3dcee-1aca-449e-98ee-13d3244dc9df","block_type":"box","text":"clients have interests adverse to those of the Fund. At times, these activities may cause business units or entities","page_number":139,"box":{"x":69,"y":241,"width":817,"height":11}},{"id":"6b7d829f-d869-4188-a733-e9291a2965ef","block_type":"box","text":"within BlackRock to give advice to clients that may cause these clients to take actions adverse to the interests of the","page_number":139,"box":{"x":68,"y":256,"width":837,"height":12}},{"id":"cccf1cae-5573-4da6-9eec-146272d9b4fa","block_type":"box","text":"Fund. To the extent such transactions are permitted, a Fund will deal with BlackRock on an arms-length basis.","page_number":139,"box":{"x":70,"y":272,"width":781,"height":11}},{"id":"ca04914d-300f-45cb-b4e2-e4b99768e9d8","block_type":"box","text":"To the extent authorized by applicable law, BlackRock may act as broker, dealer, agent, lender or adviser or in","page_number":139,"box":{"x":101,"y":294,"width":779,"height":11}},{"id":"430fb6c3-4cef-45b1-b64f-d41200eb2c02","block_type":"box","text":"other commercial capacities for a Fund. It is anticipated that the commissions, mark-ups, mark-downs, financial","page_number":139,"box":{"x":69,"y":309,"width":795,"height":11}},{"id":"b7d4036a-e3ec-4fb2-a915-487a979b64f6","block_type":"box","text":"advisory fees, underwriting and placement fees, sales fees, financing and commitment fees, brokerage fees, other","page_number":139,"box":{"x":69,"y":324,"width":821,"height":12}},{"id":"22f26437-788a-4dfb-aa4b-9b08ccf17162","block_type":"box","text":"fees, compensation or profits, rates, terms and conditions charged by BlackRock will be in its view commercially","page_number":139,"box":{"x":68,"y":339,"width":802,"height":12}},{"id":"5f637ec5-2dd7-4094-b31f-8e185961219a","block_type":"box","text":"reasonable, although BlackRock, including its sales personnel, will have an interest in obtaining fees and other","page_number":139,"box":{"x":69,"y":355,"width":792,"height":11}},{"id":"f919fbd7-6871-445d-b63f-803c6a21f9e9","block_type":"box","text":"amounts that are favorable to BlackRock and such sales personnel, which may have an adverse effect on the Funds.","page_number":139,"box":{"x":69,"y":370,"width":832,"height":11}},{"id":"02e9ec56-3f65-4042-bcdf-94ba4d45c984","block_type":"box","text":"Index based funds may use an index provider that is affiliated with another service provider of the Fund or BlackRock","page_number":139,"box":{"x":70,"y":385,"width":833,"height":11}},{"id":"b078abd4-126d-44e0-a450-a67e1902fa29","block_type":"box","text":"that acts as a broker, dealer, agent, lender or in other commercial capacities for a Fund or BlackRock.","page_number":139,"box":{"x":68,"y":400,"width":726,"height":11}},{"id":"854600f9-6ca0-474d-ab46-ebe2438ac821","block_type":"box","text":"Subject to applicable law, BlackRock (and its personnel and other distributors) will be entitled to retain fees and","page_number":139,"box":{"x":102,"y":423,"width":796,"height":11}},{"id":"98b88bc8-03ef-45df-8764-68a3d56eefaf","block_type":"box","text":"other amounts that they receive in connection with their service to the Funds as broker, dealer, agent, lender, adviser","page_number":139,"box":{"x":69,"y":438,"width":837,"height":11}},{"id":"2dd8a15b-deef-4a4c-8693-5dfc0457f76c","block_type":"box","text":"or in other commercial capacities. No accounting to the Funds or their shareholders will be required, and no fees or","page_number":139,"box":{"x":69,"y":453,"width":823,"height":11}},{"id":"909b072a-8af6-4468-a063-59df6898d297","block_type":"box","text":"other compensation payable by the Funds or their shareholders will be reduced by reason of receipt by BlackRock of","page_number":139,"box":{"x":69,"y":468,"width":828,"height":11}},{"id":"7ef4bfe0-97da-4cfa-a000-efa96da7ccf8","block_type":"box","text":"any such fees or other amounts.","page_number":139,"box":{"x":69,"y":483,"width":230,"height":11}},{"id":"dd6319a0-4498-4916-89a5-edc25ce5997d","block_type":"box","text":"When BlackRock acts as broker, dealer, agent, adviser or in other commercial capacities in relation to the Funds,","page_number":139,"box":{"x":101,"y":506,"width":805,"height":11}},{"id":"7015a87d-4907-4c0c-95c0-fd589457743e","block_type":"box","text":"BlackRock may take commercial steps in its own interests, which may have an adverse effect on the Funds.","page_number":139,"box":{"x":70,"y":521,"width":768,"height":11}},{"id":"e2af5aab-45fe-41c5-954c-266b6e0dfef8","block_type":"box","text":"A Fund will be required to establish business relationships with its counterpar ties based on the Fund’s own","page_number":139,"box":{"x":101,"y":544,"width":766,"height":10}},{"id":"5448b610-4143-445c-a5d9-a5ff83112c1c","block_type":"box","text":"credit standing. BlackRock will not have any obligation to allow its credit to be used in connection with a Fund’s","page_number":139,"box":{"x":69,"y":559,"width":793,"height":11}},{"id":"cd198aa7-3b0b-4db2-ac78-af0a372b3abe","block_type":"box","text":"establishment of its business relationships, nor is it expected that the Fund’s counterpar ties will rely on the credit of","page_number":139,"box":{"x":69,"y":574,"width":835,"height":11}},{"id":"eefd34a9-5058-4211-bf8b-07192a758aa7","block_type":"box","text":"BlackRock in evaluating the Fund’s creditwor thiness.","page_number":139,"box":{"x":70,"y":589,"width":374,"height":11}},{"id":"821beae7-1830-483c-89b0-47c0b60886dc","block_type":"box","text":"BlackRock Investment Management, LLC (“BIM”) or BlackRock Institutional Trust Company, N.A. (“BTC”), as","page_number":139,"box":{"x":102,"y":612,"width":768,"height":11}},{"id":"1c4a7fc0-5b86-4009-8d93-c57a761d0a6c","block_type":"box","text":"applicable, each an affiliate of BlackRock, pursuant to SEC exemptive relief, acts as securities lending agent to, and","page_number":139,"box":{"x":69,"y":627,"width":829,"height":11}},{"id":"3bd82138-1310-4097-87e5-8b389df5961b","block_type":"box","text":"receives a share of securities lending revenues from, the Funds. BlackRock will also receive compensation for","page_number":139,"box":{"x":69,"y":642,"width":785,"height":11}},{"id":"9ffc47de-0781-46f2-bef1-4fb61de1192a","block_type":"box","text":"managing the reinvestment of the cash collateral from securities lending. There are potential conflicts of interests in","page_number":139,"box":{"x":69,"y":657,"width":829,"height":11}},{"id":"30426181-3d78-4a98-acb4-5fdc56eceb3b","block_type":"box","text":"managing a securities lending program, including but not limited to: (i) BlackRock as securities lending agent may","page_number":139,"box":{"x":69,"y":672,"width":809,"height":11}},{"id":"a6d9d585-053b-4397-8b05-96a6cf010883","block_type":"box","text":"have an incentive to, among other things, increase or decrease the amount of securities on loan or to lend par ticular","page_number":139,"box":{"x":69,"y":687,"width":833,"height":11}},{"id":"d73a5b91-f3a0-49d1-9606-25246f7f9e1a","block_type":"box","text":"securities in order to generate additional risk-adjusted revenue for BlackRock and its affiliates; and (ii) BlackRock as","page_number":139,"box":{"x":69,"y":702,"width":829,"height":12}},{"id":"2096bbbe-fb02-46f7-80bf-336d7e6aa207","block_type":"box","text":"securities lending agent may have an incentive to allocate loans to clients that would provide more revenue to","page_number":139,"box":{"x":69,"y":718,"width":783,"height":11}},{"id":"d25f9014-17a3-4534-bef5-697ecadb9324","block_type":"box","text":"BlackRock. As described fur ther below, BlackRock seeks to mitigate this conflict by providing its securities lending","page_number":139,"box":{"x":70,"y":732,"width":814,"height":12}},{"id":"816ffc23-64ec-49d6-aa1c-351740a0986e","block_type":"box","text":"clients with equal lending oppor tunities over time in order to approximate pro rata allocation.","page_number":139,"box":{"x":69,"y":748,"width":660,"height":11}},{"id":"0bb23bdc-0e50-4110-93ad-106f5abb4b49","block_type":"box","text":"As par t of its securities lending program, BlackRock indemnifies the Funds and cer tain other clients and/or","page_number":139,"box":{"x":101,"y":770,"width":767,"height":12}},{"id":"5835f459-f485-414e-9c25-7a7cb7f26ac9","block_type":"box","text":"funds against a shor tfall in collateral in the event of borrower default. On a regular basis, BlackRock calculates the","page_number":139,"box":{"x":68,"y":785,"width":820,"height":12}},{"id":"d6ac3e45-5954-46d9-b11f-95ec0bbf2c7f","block_type":"box","text":"potential dollar exposure of collateral shor tfall resulting from a borrower default (“shor tfall risk”) in the securities","page_number":139,"box":{"x":70,"y":801,"width":806,"height":11}},{"id":"378ebc52-edb7-4a61-a8fd-c3919163e117","block_type":"box","text":"lending program. BlackRock establishes program-wide borrower limits (“credit limits”) to actively manage borrower","page_number":139,"box":{"x":70,"y":816,"width":816,"height":11}},{"id":"b47b03ab-093e-4e24-a520-bf8bfc31d7f8","block_type":"box","text":"specific credit exposure. BlackRock oversees the risk model that calculates projected collateral shor tfall values using","page_number":139,"box":{"x":69,"y":831,"width":838,"height":11}},{"id":"759fe821-78f5-4749-905b-13133b43d8ca","block_type":"box","text":"loan-level factors such as loan and collateral type and market value as well as specific borrower credit","page_number":139,"box":{"x":70,"y":846,"width":727,"height":11}},{"id":"4084a029-e56e-43a0-b71b-a408f0e53d71","block_type":"box","text":"characteristics. When necessary, BlackRock may adjust securities lending program attributes by restricting eligible","page_number":139,"box":{"x":69,"y":861,"width":815,"height":11}},{"id":"07b29b82-642c-4843-8792-3ced240f9c75","block_type":"box","text":"collateral or reducing borrower credit limits. As a result, the management of program-wide exposure as well as","page_number":139,"box":{"x":69,"y":876,"width":786,"height":11}},{"id":"40b2cef2-7bc4-4d57-83e9-e6b7c2c827ab","block_type":"box","text":"BlackRock-specific indemnification exposure may affect the amount of securities lending activity BlackRock may","page_number":139,"box":{"x":70,"y":891,"width":796,"height":12}},{"id":"6bd72a96-a9d7-4b2d-868c-42314ed0943a","block_type":"box","text":"II-92","page_number":139,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"69dcfdb8-5635-4923-9d8e-8346ea30c7f0","block_type":"box","text":"NM1026U-6033063-139/246","page_number":139,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"3de7cc02-d97c-4fc6-bbff-8c74369be4f7","block_type":"box","text":"conduct at any given point in time by reducing the volume of lending oppor tunities for cer tain loans (including by","page_number":140,"box":{"x":69,"y":45,"width":799,"height":11}},{"id":"d35a18ce-4fe8-495b-84f3-23ee91728443","block_type":"box","text":"asset type, collateral type and/or revenue profile).","page_number":140,"box":{"x":69,"y":60,"width":356,"height":11}},{"id":"4ddda772-12da-4495-b4b8-1dc2bf170a24","block_type":"box","text":"BlackRock may decline to make a securities loan on behalf of a Fund, discontinue lending on behalf of a Fund or","page_number":140,"box":{"x":102,"y":82,"width":801,"height":12}},{"id":"b171b2a5-5427-4dfa-859e-bb3f81ca7f22","block_type":"box","text":"terminate a securities loan on behalf of a Fund for any reason, including but not limited to regulatory requirements","page_number":140,"box":{"x":68,"y":98,"width":817,"height":11}},{"id":"0ba9a186-ecf8-4d56-81e8-8f394d011b0f","block_type":"box","text":"and/or market rules, liquidity considerations, or credit considerations, which may impact Funds by reducing or","page_number":140,"box":{"x":69,"y":113,"width":784,"height":11}},{"id":"8dd23aff-2285-4f94-8565-f375f0b5670f","block_type":"box","text":"eliminating the volume of lending oppor tunities for cer tain types of loans, loans in par ticular markets, loans of","page_number":140,"box":{"x":69,"y":128,"width":789,"height":11}},{"id":"21df13f5-57bb-4475-a16b-93463808d9a0","block_type":"box","text":"par ticular securities or types of securities, or for loans overall. In addition, some borrowers may prefer cer tain","page_number":140,"box":{"x":70,"y":143,"width":783,"height":11}},{"id":"28dfe267-653d-445f-962a-e37c0162ad97","block_type":"box","text":"BlackRock lenders that provide additional protections against lender default that are favored by their prudential","page_number":140,"box":{"x":70,"y":158,"width":790,"height":11}},{"id":"8268162d-c5c9-4e74-aec0-a8f65f6b4b3e","block_type":"box","text":"regulation.","page_number":140,"box":{"x":69,"y":173,"width":73,"height":11}},{"id":"d43e0677-4de3-4f6f-8551-7e6a08058f66","block_type":"box","text":"BlackRock uses a predetermined systematic process in order to approximate pro rata allocation over time. In","page_number":140,"box":{"x":102,"y":196,"width":777,"height":11}},{"id":"db908379-198d-4241-ba1b-a9a117904532","block_type":"box","text":"order to allocate a loan to a por tfolio: (i) BlackRock as a whole must have sufficient lending capacity pursuant to the","page_number":140,"box":{"x":69,"y":211,"width":830,"height":11}},{"id":"a1e5ccbd-ffd6-4828-b735-f80758ec6668","block_type":"box","text":"various program limits (","page_number":140,"box":{"x":68,"y":226,"width":168,"height":11}},{"id":"b0c2b935-17d2-4480-966d-00f9ec686746","block_type":"box","text":"i.e.","page_number":140,"box":{"x":238,"y":226,"width":20,"height":9}},{"id":"470bb793-48a7-421c-9699-703fd912827e","block_type":"box","text":"indemnification exposure limit and borrower credit limits); (ii) the lending por tfolio must","page_number":140,"box":{"x":265,"y":226,"width":621,"height":11}},{"id":"a0687437-1364-4739-b340-e29ad90c95db","block_type":"box","text":"hold the asset at the time a loan oppor tunity arrives; and (iii) the lending por tfolio must also have enough inventory,","page_number":140,"box":{"x":69,"y":241,"width":827,"height":11}},{"id":"bc03be13-e51d-4ea4-a952-28e31095b607","block_type":"box","text":"either on its own or when aggregated with other por tfolios into one single market delivery, to satisfy the loan request.","page_number":140,"box":{"x":69,"y":256,"width":836,"height":12}},{"id":"b4c35afd-4861-4159-9782-44c6521e7fd6","block_type":"box","text":"In doing so, BlackRock seeks to provide equal lending oppor tunities for all por tfolios, independent of whether","page_number":140,"box":{"x":70,"y":271,"width":780,"height":12}},{"id":"7af9f303-b075-47a6-8830-9d48fb4e4473","block_type":"box","text":"BlackRock indemnifies the por tfolio. Equal oppor tunities for lending por tfolios does not guarantee equal outcomes.","page_number":140,"box":{"x":70,"y":286,"width":820,"height":12}},{"id":"477f4bf0-c3c9-43fb-895d-dc7d29258b96","block_type":"box","text":"Specifically, shor t and long-term outcomes for individual clients may vary due to asset mix, asset/liability spreads on","page_number":140,"box":{"x":69,"y":302,"width":834,"height":11}},{"id":"8bffe1d8-e182-4771-86e4-2c992925902d","block_type":"box","text":"different securities, and the overall limits imposed by the firm.","page_number":140,"box":{"x":69,"y":317,"width":444,"height":11}},{"id":"57b26f27-9f44-44ea-88a2-916e723da9fd","block_type":"box","text":"Purchases and sales of securities and other assets for a Fund may be aggregated with orders for other","page_number":140,"box":{"x":102,"y":339,"width":734,"height":12}},{"id":"01b0a73b-4ede-4961-bb4a-6880f82bfde0","block_type":"box","text":"BlackRock client accounts, including with accounts that pay different transaction costs solely due to the fact that they","page_number":140,"box":{"x":70,"y":355,"width":840,"height":11}},{"id":"8501634e-1be2-4639-ac43-4ab32177feb8","block_type":"box","text":"have different research payment arrangements. BlackRock, however, is not required to aggregate orders if por tfolio","page_number":140,"box":{"x":69,"y":370,"width":822,"height":11}},{"id":"6b345678-e184-4aa3-b8dd-c8f84311050a","block_type":"box","text":"management decisions for different accounts are made separately, or if they determine that aggregating is not","page_number":140,"box":{"x":69,"y":385,"width":788,"height":11}},{"id":"a15601c1-93cd-4a7d-a61c-105581bf542d","block_type":"box","text":"practicable or required, or in cases involving client direction.","page_number":140,"box":{"x":70,"y":400,"width":426,"height":11}},{"id":"7232c906-b6aa-485a-aa1c-53d9654dc932","block_type":"box","text":"Prevailing trading activity frequently may make impossible the receipt of the same price or execution on the","page_number":140,"box":{"x":102,"y":423,"width":763,"height":11}},{"id":"10f411e4-a30b-4294-88d4-ec91e8face66","block_type":"box","text":"entire volume of securities purchased or sold. When this occurs, the various prices may be averaged, and the Funds","page_number":140,"box":{"x":69,"y":438,"width":828,"height":11}},{"id":"4b2fd96e-6bb4-4e1e-b5fd-deb4f9a7b0f3","block_type":"box","text":"will be charged or credited with the average price. Thus, the effect of the aggregation may operate on some","page_number":140,"box":{"x":68,"y":453,"width":767,"height":11}},{"id":"c0627531-dbba-4f79-9a40-7094e613944d","block_type":"box","text":"occasions to the disadvantage of the Funds. In addition, under cer tain circumstances, the Funds will not be charged","page_number":140,"box":{"x":69,"y":468,"width":828,"height":11}},{"id":"adbc20e7-dc77-4539-8227-f2f41e99395d","block_type":"box","text":"the same commission or commission equivalent rates in connection with an aggregated order.","page_number":140,"box":{"x":68,"y":483,"width":672,"height":11}},{"id":"4f21222d-623f-41f2-87a0-a83c268e9380","block_type":"box","text":"As discussed in the section below entitled “Por tfolio Transactions and Brokerage—Transactions in Por tfolio","page_number":140,"box":{"x":101,"y":506,"width":767,"height":11}},{"id":"393a033a-188f-421a-bc58-ee635fb74daf","block_type":"box","text":"Securities,” BlackRock, unless prohibited by applicable law, may cause a Fund or account to pay a broker or dealer a","page_number":140,"box":{"x":69,"y":521,"width":832,"height":11}},{"id":"b53cc043-af79-493e-9acc-b13cf967ddee","block_type":"box","text":"commission for effecting a transaction that exceeds the amount another broker or dealer would have charged for","page_number":140,"box":{"x":69,"y":536,"width":805,"height":11}},{"id":"bf8d74f6-b90a-4834-852a-2bce7df3f4a6","block_type":"box","text":"effecting the same transaction in recognition of the value of brokerage and research services provided by that broker","page_number":140,"box":{"x":69,"y":551,"width":836,"height":11}},{"id":"9086cafe-a59e-4f92-b46f-edb16057c646","block_type":"box","text":"or dealer. Under MiFID II, EU investment managers, including BlackRock International Limited (“BIL”) which acts as a","page_number":140,"box":{"x":69,"y":566,"width":831,"height":11}},{"id":"afe6c191-04cd-4753-9ae0-8e3e8e1ea410","block_type":"box","text":"sub-adviser to cer tain Funds, pay for research from brokers and dealers directly out of their own resources, rather","page_number":140,"box":{"x":69,"y":581,"width":812,"height":11}},{"id":"11542970-c700-40aa-97d0-bf0ffe5e55a8","block_type":"box","text":"than through client commissions.","page_number":140,"box":{"x":68,"y":597,"width":237,"height":11}},{"id":"53fa04bb-fdfb-418f-9319-2731bbba8f73","block_type":"box","text":"Subject to applicable law, BlackRock may select brokers that furnish BlackRock, the Funds, other BlackRock","page_number":140,"box":{"x":102,"y":619,"width":770,"height":11}},{"id":"c888022c-bcb2-4a1a-a88d-a9eb1dd6467e","block_type":"box","text":"client accounts or personnel, directly or through correspondent relationships, with research or other appropriate","page_number":140,"box":{"x":69,"y":634,"width":797,"height":12}},{"id":"a9808787-c02c-4c5b-b835-900862f3254d","block_type":"box","text":"services which provide, in BlackRock’s view, appropriate assistance to BlackRock in the investment decision making","page_number":140,"box":{"x":69,"y":650,"width":830,"height":11}},{"id":"f8ffd104-24eb-4c7d-8b75-0c002d2de376","block_type":"box","text":"process (including with respect to futures, fixed-price offerings and OTC transactions). Such research or other","page_number":140,"box":{"x":70,"y":664,"width":780,"height":12}},{"id":"6b29465e-5df0-4356-8cbb-8090cc28f351","block_type":"box","text":"services may include, to the extent permitted by law, research repor ts on companies, industries and securities;","page_number":140,"box":{"x":69,"y":680,"width":795,"height":11}},{"id":"ed9d1309-2338-44f0-bb9f-739325e6875d","block_type":"box","text":"economic and financial data; financial publications; proxy analysis; trade industry seminars; computer data bases;","page_number":140,"box":{"x":69,"y":695,"width":815,"height":11}},{"id":"95374376-24f5-495d-8774-e45365141709","block_type":"box","text":"research-oriented software and other services and products.","page_number":140,"box":{"x":69,"y":710,"width":430,"height":11}},{"id":"b763e310-500e-4343-8f7d-ad5e2a567a1a","block_type":"box","text":"Research or other services obtained in this manner may be used in servicing any or all of the Funds and other","page_number":140,"box":{"x":102,"y":732,"width":785,"height":12}},{"id":"7b54c4bf-8aa6-4460-8430-3e2d9bf818d5","block_type":"box","text":"BlackRock client accounts, including in connection with BlackRock client accounts other than those that pay","page_number":140,"box":{"x":70,"y":748,"width":768,"height":11}},{"id":"d48425ef-6f4a-4964-9fd8-1b04df17daa4","block_type":"box","text":"commissions to the broker relating to the research or other service arrangements. Such products and services may","page_number":140,"box":{"x":69,"y":763,"width":826,"height":11}},{"id":"d54c36c0-6ce2-4233-b6a2-ec7847bc1819","block_type":"box","text":"dispropor tionately benefit other BlackRock client accounts relative to the Funds based on the amount of brokerage","page_number":140,"box":{"x":69,"y":778,"width":818,"height":11}},{"id":"a69ac088-6728-4473-ab1d-a5a22b86aadb","block_type":"box","text":"commissions paid by the Funds and such other BlackRock client accounts. For example, research or other services","page_number":140,"box":{"x":69,"y":793,"width":821,"height":11}},{"id":"d03f8b19-d490-4465-8e4d-d74ac5dc3ada","block_type":"box","text":"that are paid for through one client’s commissions may not be used in managing that client’s account. In addition,","page_number":140,"box":{"x":68,"y":808,"width":815,"height":11}},{"id":"5f4dc40e-c1de-4f37-8f0f-94ddba498334","block_type":"box","text":"other BlackRock client accounts may receive the benefit, including dispropor tionate benefits, of economies of scale","page_number":140,"box":{"x":69,"y":823,"width":824,"height":12}},{"id":"4d218cad-9d8d-4635-9710-1fdac176ec9b","block_type":"box","text":"or price discounts in connection with products and services that may be provided to the Funds and to such other","page_number":140,"box":{"x":69,"y":839,"width":804,"height":10}},{"id":"fd11d1a8-888f-4b48-90a6-a69e7c859892","block_type":"box","text":"BlackRock client accounts. To the extent that BlackRock uses soft dollars, it will not have to pay for those products","page_number":140,"box":{"x":70,"y":853,"width":819,"height":12}},{"id":"69070f0f-07bc-435f-a9f9-79e874cdfe55","block_type":"box","text":"and services itself.","page_number":140,"box":{"x":69,"y":869,"width":134,"height":9}},{"id":"d65ccdc2-c6b2-46b2-8efc-9f982327f98f","block_type":"box","text":"BlackRock, unless prohibited by applicable law, may endeavor to execute trades through brokers who, pursuant","page_number":140,"box":{"x":102,"y":891,"width":793,"height":12}},{"id":"681c8473-b97f-4f66-b40b-e8f579471cc3","block_type":"box","text":"to such arrangements, provide research or other services in order to ensure the continued receipt of research or","page_number":140,"box":{"x":68,"y":906,"width":805,"height":12}},{"id":"af68cc00-7d7b-4934-85d9-223e32b1f15b","block_type":"box","text":"II-93","page_number":140,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"4dcffa78-9361-4bf6-a0c1-0632248cf6ad","block_type":"box","text":"NM1026U-6033063-140/246","page_number":140,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"e0188b4d-05b9-4202-b329-4710a24ae516","block_type":"box","text":"other services BlackRock believes are useful in its investment decision-making process. BlackRock may from time to","page_number":141,"box":{"x":69,"y":45,"width":833,"height":11}},{"id":"e861f541-18a6-4d1a-97f1-2cda9f5fa818","block_type":"box","text":"time choose not to engage in the above described arrangements to varying degrees. BlackRock, unless prohibited by","page_number":141,"box":{"x":68,"y":60,"width":836,"height":11}},{"id":"dea38dfa-ea5e-4736-9920-23ca9905ba60","block_type":"box","text":"applicable law, may also enter into commission sharing arrangements under which BlackRock may execute","page_number":141,"box":{"x":69,"y":75,"width":760,"height":11}},{"id":"2c4ceee2-1f50-4bc9-bf2f-ba35bf13eac5","block_type":"box","text":"transactions through a broker-dealer and request that the broker-dealer allocate a por tion of the commissions or","page_number":141,"box":{"x":68,"y":90,"width":803,"height":11}},{"id":"39669fed-07b5-4db0-88c2-4109573d1e5a","block_type":"box","text":"commission credits to another firm that provides research to BlackRock. To the extent that BlackRock engages in","page_number":141,"box":{"x":69,"y":105,"width":807,"height":11}},{"id":"3b0d808a-9874-4877-b6cf-28de80a0e9f2","block_type":"box","text":"commission sharing arrangements, many of the same conflicts related to traditional soft dollars may exist.","page_number":141,"box":{"x":69,"y":120,"width":760,"height":12}},{"id":"85ebd263-60ae-4568-a538-30ffdb0d2d12","block_type":"box","text":"BlackRock may utilize cer tain electronic crossing networks (“ECNs”) (including, without limitation, ECNs in which","page_number":141,"box":{"x":102,"y":143,"width":799,"height":11}},{"id":"7602c4af-69fa-4c71-8a13-a7416a6443ee","block_type":"box","text":"BlackRock has an investment or other interest, to the extent permitted by applicable law) in executing client","page_number":141,"box":{"x":70,"y":158,"width":767,"height":11}},{"id":"4c5eca06-f5bb-4cb2-a28c-55c697088e69","block_type":"box","text":"securities transactions for cer tain types of securities. These ECNs may charge fees for their services, including","page_number":141,"box":{"x":69,"y":173,"width":794,"height":11}},{"id":"fd327f73-fa79-4830-b574-c96930992465","block_type":"box","text":"access fees and transaction fees. The transaction fees, which are similar to commissions or markups/ markdowns,","page_number":141,"box":{"x":69,"y":188,"width":825,"height":11}},{"id":"1668b8ca-d961-4e32-857e-09c893eb658e","block_type":"box","text":"will generally be charged to clients and, like commissions and markups/markdowns, would generally be included in","page_number":141,"box":{"x":68,"y":204,"width":821,"height":11}},{"id":"cadac9bb-6cb3-4c9e-bef9-2b2097dce9de","block_type":"box","text":"the cost of the securities purchased. Access fees may be paid by BlackRock even though incurred in connection with","page_number":141,"box":{"x":68,"y":218,"width":833,"height":12}},{"id":"511078f5-fc97-45fe-8003-4a18eac35449","block_type":"box","text":"executing transactions on behalf of clients, including the Funds. In cer tain circumstances, ECNs may offer volume","page_number":141,"box":{"x":69,"y":234,"width":812,"height":11}},{"id":"3b323a0b-2d66-4104-90ea-e91020560dd6","block_type":"box","text":"discounts that will reduce the access fees typically paid by BlackRock. BlackRock will only utilize ECNs consistent","page_number":141,"box":{"x":69,"y":249,"width":809,"height":11}},{"id":"b0cef746-2aca-4ee1-a637-452f08494699","block_type":"box","text":"with its obligation to seek to obtain best execution in client transactions.","page_number":141,"box":{"x":68,"y":264,"width":519,"height":11}},{"id":"a7f347b8-05d4-4990-bd68-df2a7ed6cdfe","block_type":"box","text":"BlackRock owns a minority interest in, and is a member of, Members Exchange (“MEMX”), a newly created U.S.","page_number":141,"box":{"x":102,"y":286,"width":793,"height":12}},{"id":"f4eab6de-dcfc-498e-b741-024ba03fd618","block_type":"box","text":"stock exchange. Transactions for a Fund may be executed on MEMX if third par ty brokers select MEMX as the","page_number":141,"box":{"x":69,"y":302,"width":782,"height":11}},{"id":"7522416a-8abb-48d5-832b-d5ffa3cd7d0f","block_type":"box","text":"appropriate venue for execution of orders placed by BlackRock traders on behalf of client por tfolios.","page_number":141,"box":{"x":69,"y":317,"width":710,"height":11}},{"id":"37ad8988-0060-4f74-a6ce-f7384fb9974c","block_type":"box","text":"BlackRock has adopted policies and procedures designed to prevent conflicts of interest from influencing proxy","page_number":141,"box":{"x":102,"y":339,"width":792,"height":12}},{"id":"d3e3bcc6-df7c-4bd5-b57e-fe291ea8bb3d","block_type":"box","text":"voting decisions that it makes on behalf of advisory clients, including the Funds, and to help ensure that such","page_number":141,"box":{"x":68,"y":355,"width":784,"height":11}},{"id":"bca82b31-b564-4b67-976c-04ac28368f5e","block_type":"box","text":"decisions are made in accordance with BlackRock’s fiduciary obligations to its clients. Never theless, notwithstanding","page_number":141,"box":{"x":69,"y":370,"width":837,"height":11}},{"id":"20ff383f-9230-48f0-b704-f7b6d3075ae9","block_type":"box","text":"such proxy voting policies and procedures, actual proxy voting decisions of BlackRock may have the effect of favoring","page_number":141,"box":{"x":69,"y":385,"width":835,"height":11}},{"id":"80be9033-20b4-4b2d-8681-025877b53615","block_type":"box","text":"the interests of other clients or businesses of other divisions or units of BlackRock, provided that BlackRock believes","page_number":141,"box":{"x":68,"y":400,"width":837,"height":11}},{"id":"b8416603-ce59-456c-972f-9b8bcfc212bc","block_type":"box","text":"such voting decisions to be in accordance with its fiduciary obligations. For a more detailed discussion of these","page_number":141,"box":{"x":69,"y":415,"width":795,"height":11}},{"id":"d910bbb0-152f-40dc-8a32-597aadbebb73","block_type":"box","text":"policies and procedures, see “Proxy Voting Policies and Procedures.”","page_number":141,"box":{"x":70,"y":430,"width":490,"height":11}},{"id":"30534a75-828d-4e9e-978f-a401ff2c9f88","block_type":"box","text":"It is also possible that, from time to time, BlackRock and/or its advisory clients (including other funds and","page_number":141,"box":{"x":102,"y":453,"width":757,"height":11}},{"id":"244648d1-e373-42f2-9652-3fd50456860b","block_type":"box","text":"separately managed accounts) may, subject to compliance with applicable law, purchase and hold shares of a Fund.","page_number":141,"box":{"x":69,"y":468,"width":825,"height":11}},{"id":"92a43e3a-9d53-471b-88ae-29772d6fed28","block_type":"box","text":"Increasing a Fund’s assets may enhance investment flexibility and diversification and may contribute to economies of","page_number":141,"box":{"x":70,"y":483,"width":837,"height":11}},{"id":"85a80b38-6de0-4e92-b7f1-0bd26d56a789","block_type":"box","text":"scale that tend to reduce the Fund’s expense ratio. BlackRock reserves the right, subject to compliance with","page_number":141,"box":{"x":69,"y":498,"width":774,"height":11}},{"id":"5fec64e0-88d3-4955-9dd1-f805175d96e2","block_type":"box","text":"applicable law, to redeem at any time some or all of the shares of a Fund acquired for its own accounts. A large","page_number":141,"box":{"x":69,"y":513,"width":796,"height":12}},{"id":"9dbc747a-3808-418d-8862-366e40e8c67d","block_type":"box","text":"redemption of shares of a Fund by BlackRock could significantly reduce the asset size of the Fund, which might have","page_number":141,"box":{"x":69,"y":528,"width":830,"height":12}},{"id":"537adc90-9485-48c0-bb03-4ee7b0d49559","block_type":"box","text":"an adverse effect on the Fund’s investment flexibility, por tfolio diversification and expense ratio. BlackRock seeks to","page_number":141,"box":{"x":69,"y":543,"width":831,"height":12}},{"id":"3ed17d56-a915-407c-b9db-83c2be1d8326","block_type":"box","text":"consider the effect of redemptions on a Fund and other shareholders in deciding whether to redeem its shares but is","page_number":141,"box":{"x":69,"y":559,"width":834,"height":11}},{"id":"382ae6b5-a363-4026-a685-7017c1dd1cf1","block_type":"box","text":"not obligated to do so and may elect not to do so.","page_number":141,"box":{"x":69,"y":574,"width":355,"height":11}},{"id":"7da3b9fd-2704-48a0-9f49-b31f585ef9fd","block_type":"box","text":"It is possible that a Fund may invest in securities of, or engage in transactions with, companies in which","page_number":141,"box":{"x":102,"y":596,"width":742,"height":12}},{"id":"341c15d5-2eb3-4cc5-9dc9-95f83d64b997","block_type":"box","text":"BlackRock has significant debt or equity investments or other interests. 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In addition, from time to time, the activities of BlackRock may limit a Fund’s flexibility in purchases","page_number":141,"box":{"x":68,"y":672,"width":822,"height":11}},{"id":"023a8596-17b5-4d72-a35f-6f328152444b","block_type":"box","text":"and sales of securities. As indicated below, BlackRock may engage in transactions with companies in which","page_number":141,"box":{"x":69,"y":687,"width":766,"height":11}},{"id":"a7d2c65e-a6ca-4a13-8194-acdf3d46c316","block_type":"box","text":"BlackRock-advised funds or other clients of BlackRock have an investment.","page_number":141,"box":{"x":70,"y":702,"width":533,"height":9}},{"id":"b3ffc600-971d-4cf7-ae60-efa1e3f4fc09","block_type":"box","text":"BlackRock and its personnel and other financial service providers may have interests in promoting sales of the","page_number":141,"box":{"x":102,"y":725,"width":789,"height":11}},{"id":"881350a3-6f21-4838-95d0-afab0e85e468","block_type":"box","text":"Funds. With respect to BlackRock and its personnel, the remuneration and profitability relating to services to and","page_number":141,"box":{"x":70,"y":740,"width":805,"height":11}},{"id":"70e33242-c1cb-42f2-a9be-a413d54fd0de","block_type":"box","text":"sales of the Funds or other products may be greater than remuneration and profitability relating to services to and","page_number":141,"box":{"x":69,"y":755,"width":813,"height":11}},{"id":"2bfdb25f-0846-4cc2-83b7-a48f137ba355","block_type":"box","text":"sales of cer tain funds or other products that might be provided or offered. BlackRock and its sales personnel may","page_number":141,"box":{"x":69,"y":770,"width":814,"height":12}},{"id":"36229897-a623-4964-9399-3d5be00b7297","block_type":"box","text":"directly or indirectly receive a por tion of the fees and commissions charged to the Funds or their shareholders.","page_number":141,"box":{"x":69,"y":785,"width":788,"height":12}},{"id":"7d99f3f2-8606-4e39-8be5-d585ef2db6c8","block_type":"box","text":"BlackRock and its advisory or other personnel may also benefit from increased amounts of assets under","page_number":141,"box":{"x":70,"y":801,"width":745,"height":11}},{"id":"d2895217-e640-4e40-ad15-a3699f118f65","block_type":"box","text":"management. Fees and commissions may also be higher than for other products or services, and the remuneration","page_number":141,"box":{"x":69,"y":816,"width":822,"height":11}},{"id":"9b8579e4-26ae-4649-876a-e27dfb60bd59","block_type":"box","text":"and profitability to BlackRock and such personnel resulting from transactions on behalf of or management of the","page_number":141,"box":{"x":69,"y":831,"width":801,"height":11}},{"id":"be653da3-3c0c-4719-a722-5a402897da9f","block_type":"box","text":"Funds may be greater than the remuneration and profitability resulting from other funds or products.","page_number":141,"box":{"x":70,"y":846,"width":711,"height":11}},{"id":"8e04aa3e-0ad6-4f7c-ac67-af6dcf73d468","block_type":"box","text":"BlackRock may provide valuation assistance to cer tain clients with respect to cer tain securities or other","page_number":141,"box":{"x":102,"y":869,"width":741,"height":11}},{"id":"58c2ba0f-49e9-49ae-b638-1fd7b02122e4","block_type":"box","text":"investments and the valuation recommendations made for such clients’ accounts may differ from the valuations for","page_number":141,"box":{"x":70,"y":884,"width":823,"height":11}},{"id":"267731ae-332a-4e3d-9c13-18d3ddd6c0c5","block_type":"box","text":"the same securities or investments assigned by a Fund’s pricing vendors, especially if such valuations are based on","page_number":141,"box":{"x":68,"y":899,"width":829,"height":11}},{"id":"eb28c550-3488-4916-81a4-dac6991ec684","block_type":"box","text":"II-94","page_number":141,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"cbe6170d-84f4-4358-a483-d3202a65b056","block_type":"box","text":"NM1026U-6033063-141/246","page_number":141,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"9c9a9235-00b6-4df7-83c3-96fad3c0e633","block_type":"box","text":"broker-dealer quotes or other data sources unavailable to the Fund’s pricing vendors. While BlackRock will generally","page_number":142,"box":{"x":69,"y":45,"width":825,"height":11}},{"id":"c5c20546-7f85-4e40-8e0f-014c5b5e118c","block_type":"box","text":"communicate its valuation information or determinations to a Fund’s pricing vendors and/or fund accountants, there","page_number":142,"box":{"x":69,"y":60,"width":830,"height":11}},{"id":"0978e9ac-c3d0-4547-b16e-5aea7f6e22f1","block_type":"box","text":"may be instances where the Fund’s pricing vendors or fund accountants assign a different valuation to a security or","page_number":142,"box":{"x":69,"y":75,"width":824,"height":11}},{"id":"8c9bfd54-05b1-4326-80df-d68c745904b7","block_type":"box","text":"other investment than the valuation for such security or investment determined or recommended by BlackRock.","page_number":142,"box":{"x":69,"y":90,"width":792,"height":11}},{"id":"098d3771-23c6-4477-a794-cff70960afea","block_type":"box","text":"As disclosed in more detail in “Pricing of Shares—Determination of Net Asset Value” in this SAI, when market","page_number":142,"box":{"x":101,"y":113,"width":784,"height":11}},{"id":"e6cfc2ec-5002-43f0-8ddf-ea2a98672f86","block_type":"box","text":"quotations are not readily available or are believed by BlackRock to be unreliable, a Fund’s investments are valued at","page_number":142,"box":{"x":69,"y":128,"width":837,"height":11}},{"id":"7fa3765c-b076-43d7-be24-5d85702f982d","block_type":"box","text":"fair value by BlackRock. BlackRock has been designated as the Fund’s valuation designee pursuant to Rule 2a-5","page_number":142,"box":{"x":68,"y":143,"width":803,"height":11}},{"id":"d044b6c8-7f4b-444d-a747-49282556409f","block_type":"box","text":"under the Investment Company Act and acts through BlackRock’s Rule 2a-5 Committee (the “2a-5 Committee”), with","page_number":142,"box":{"x":69,"y":158,"width":831,"height":11}},{"id":"bd20b3ed-426f-4e9d-a51d-e37651e9b93b","block_type":"box","text":"assistance from other BlackRock pricing committees and in accordance with BlackRock’s policies and procedures","page_number":142,"box":{"x":69,"y":173,"width":811,"height":11}},{"id":"fb7fe9ab-5e05-49c1-86a6-6e3b21c9d2f7","block_type":"box","text":"(the “Valuation Procedures”). When determining a “fair value price,” the 2a-5 Committee seeks to determine the","page_number":142,"box":{"x":69,"y":188,"width":802,"height":12}},{"id":"3ad466b3-9c4b-40bc-8bec-b1ef93d7261c","block_type":"box","text":"price that a Fund might reasonably expect to receive from the current sale of that asset or liability in an arm’s-length","page_number":142,"box":{"x":70,"y":203,"width":829,"height":12}},{"id":"eb826bef-b83a-474c-9692-b1b733b16027","block_type":"box","text":"transaction. The price generally may not be determined based on what a Fund might reasonably expect to receive for","page_number":142,"box":{"x":68,"y":218,"width":832,"height":12}},{"id":"ed6f1650-15b4-4452-9f43-92a3a7666cfc","block_type":"box","text":"selling an asset or liability at a later time or if it holds the asset or liability to maturity. While fair value determinations","page_number":142,"box":{"x":69,"y":234,"width":837,"height":11}},{"id":"18d8482e-1025-4a16-9275-b79b9e63c5a7","block_type":"box","text":"will be based upon all available factors that BlackRock deems relevant at the time of the determination, and may be","page_number":142,"box":{"x":68,"y":249,"width":829,"height":11}},{"id":"d2beace3-c0a8-4a88-8d69-66df35f95f6a","block_type":"box","text":"based on analytical values determined by BlackRock using proprietary or third par ty valuation models, fair value","page_number":142,"box":{"x":69,"y":264,"width":796,"height":11}},{"id":"afe708dd-7f4f-4c34-a8c5-a171bde09f1d","block_type":"box","text":"represents only a good faith approximation of the value of an asset or liability. The fair value of one or more assets or","page_number":142,"box":{"x":69,"y":279,"width":839,"height":11}},{"id":"9db76fcd-0885-430c-9077-4992fedbbbec","block_type":"box","text":"liabilities may not, in retrospect, be the price at which those assets or liabilities could have been sold during the","page_number":142,"box":{"x":70,"y":294,"width":800,"height":11}},{"id":"a313657c-42d2-46d0-b3e7-ad83b3ad4cfb","block_type":"box","text":"period in which the par ticular fair values were used in determining a Fund’s NAV. As a result, a Fund’s sale or","page_number":142,"box":{"x":70,"y":309,"width":779,"height":11}},{"id":"5f118ae8-9af1-4a02-b527-0f9242a31f5d","block_type":"box","text":"redemption of its shares at NAV, at a time when a holding or holdings are valued by the 2a-5 Committee at fair value,","page_number":142,"box":{"x":69,"y":324,"width":834,"height":12}},{"id":"f496e618-25d5-43a4-b6eb-bd14463b0b6e","block_type":"box","text":"may have the effect of diluting or increasing the economic interest of existing shareholders and may affect the","page_number":142,"box":{"x":69,"y":339,"width":788,"height":12}},{"id":"895f0d27-4233-49ac-80ec-a1ec11383b36","block_type":"box","text":"amount of revenue received by BlackRock with respect to services for which it receives an asset-based fee.","page_number":142,"box":{"x":69,"y":355,"width":765,"height":11}},{"id":"730456e2-a528-4029-8c69-f264f9c880fa","block_type":"box","text":"To the extent permitted by applicable law, a Fund may invest all or some of its shor t term cash investments in","page_number":142,"box":{"x":101,"y":377,"width":784,"height":11}},{"id":"dac2b420-01b6-44f8-bc52-2b4780819365","block_type":"box","text":"any money market fund or similarly-managed private fund advised or managed by BlackRock. In connection with any","page_number":142,"box":{"x":69,"y":392,"width":823,"height":12}},{"id":"f6cc259b-0e9b-40e6-a8dd-f846c99a7faa","block_type":"box","text":"such investments, a Fund, to the extent permitted by the Investment Company Act, may pay its share of expenses of","page_number":142,"box":{"x":69,"y":407,"width":833,"height":12}},{"id":"4fb9b552-27f7-42a2-a2b3-61d8870e634f","block_type":"box","text":"a money market fund or other similarly-managed private fund in which it invests, which may result in a Fund bearing","page_number":142,"box":{"x":69,"y":423,"width":822,"height":11}},{"id":"2db63693-28ed-4714-aa52-c10d69d180f9","block_type":"box","text":"some additional expenses.","page_number":142,"box":{"x":69,"y":438,"width":190,"height":11}},{"id":"ac7bca98-35ed-4b50-a041-0ed735117e28","block_type":"box","text":"BlackRock and its directors, officers and employees, may buy and sell securities or other investments for their","page_number":142,"box":{"x":102,"y":460,"width":787,"height":12}},{"id":"4582c640-1957-4397-84db-ec3b50ac94c4","block_type":"box","text":"own accounts and may have conflicts of interest with respect to investments made on behalf of a Fund. 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To lessen the possibility that a Fund will be adversely affected by this personal trading, the Fund, BRIL and","page_number":142,"box":{"x":70,"y":521,"width":802,"height":11}},{"id":"9c7f1e75-fab8-4fc6-9a2f-c1b58478cc9d","block_type":"box","text":"BlackRock each have adopted a Code of Ethics in compliance with Section 17(j) of the Investment Company Act that","page_number":142,"box":{"x":70,"y":536,"width":828,"height":11}},{"id":"46a9c167-0296-4462-842d-4cf07e8bdf77","block_type":"box","text":"restricts securities trading in the personal accounts of investment professionals and others who normally come into","page_number":142,"box":{"x":69,"y":551,"width":825,"height":11}},{"id":"d14a03a0-0cfb-4886-82ec-0fcaa2161557","block_type":"box","text":"possession of information regarding the Fund’s por tfolio transactions. Each Code of Ethics is also available on the","page_number":142,"box":{"x":70,"y":566,"width":816,"height":11}},{"id":"3616cf20-8708-4cb5-9ec0-ca491869011e","block_type":"box","text":"EDGAR Database on the Commission’s Internet site at http://www.sec.gov, and copies may be obtained, after paying","page_number":142,"box":{"x":70,"y":581,"width":836,"height":12}},{"id":"567a1279-4f24-4786-a18e-f81dbe514d57","block_type":"box","text":"a duplicating fee, by e-mail at publicinfo@sec.gov.","page_number":142,"box":{"x":69,"y":596,"width":352,"height":12}},{"id":"42d1c8e9-8fd9-4fe0-8ef9-64563f4ebd3d","block_type":"box","text":"BlackRock will not purchase securities or other proper ty from, or sell securities or other proper ty to, a Fund,","page_number":142,"box":{"x":102,"y":619,"width":768,"height":11}},{"id":"3bd539ee-9d4a-431b-8068-06459879d67d","block_type":"box","text":"except that the Fund may in accordance with rules or guidance adopted under the Investment Company Act engage in","page_number":142,"box":{"x":69,"y":634,"width":836,"height":12}},{"id":"5dd5a234-75fb-43d6-82bb-6c395ef28c2c","block_type":"box","text":"transactions with another Fund or accounts that are affiliated with the Fund as a result of common officers, directors,","page_number":142,"box":{"x":68,"y":649,"width":839,"height":11}},{"id":"0f545c31-9408-4369-b998-799448565127","block_type":"box","text":"or investment advisers or pursuant to exemptive orders granted to the Funds and/or BlackRock by the Commission.","page_number":142,"box":{"x":69,"y":665,"width":824,"height":11}},{"id":"6327e6d8-ea2d-48a6-8a05-3e8c664dfff5","block_type":"box","text":"These transactions would be effected in circumstances in which BlackRock determined that it would be appropriate","page_number":142,"box":{"x":68,"y":680,"width":824,"height":11}},{"id":"9a851640-c921-4118-856f-d82b62d2dcd1","block_type":"box","text":"for the Fund to purchase and another client of BlackRock to sell, or the Fund to sell and another client of BlackRock","page_number":142,"box":{"x":68,"y":695,"width":826,"height":11}},{"id":"e5817880-0840-451e-9255-76794a642af0","block_type":"box","text":"to purchase, the same security or instrument on the same day. From time to time, the activities of a Fund may be","page_number":142,"box":{"x":68,"y":710,"width":810,"height":11}},{"id":"87ec6494-a801-4180-b79e-683947ef3d8b","block_type":"box","text":"restricted because of regulatory requirements applicable to BlackRock and/or BlackRock’s internal policies designed","page_number":142,"box":{"x":69,"y":725,"width":834,"height":11}},{"id":"a89ce1a2-eaad-4a10-8b82-ab2f933d1797","block_type":"box","text":"to comply with, limit the applicability of, or that otherwise relate to such requirements. A client not advised by","page_number":142,"box":{"x":68,"y":740,"width":782,"height":11}},{"id":"2888113a-3595-4918-97ad-a7342145acb3","block_type":"box","text":"BlackRock would not be subject to some of those considerations. There may be periods when BlackRock may not","page_number":142,"box":{"x":70,"y":755,"width":807,"height":11}},{"id":"ae873235-4d95-4e64-96bd-9bce2617d221","block_type":"box","text":"initiate or recommend cer tain types of transactions, or may otherwise restrict or limit its advice regarding cer tain","page_number":142,"box":{"x":70,"y":770,"width":804,"height":12}},{"id":"ec71630a-0fce-4788-98b5-0ec212364912","block_type":"box","text":"securities or instruments issued by or related to companies for which BlackRock is per forming advisory or other","page_number":142,"box":{"x":69,"y":785,"width":799,"height":12}},{"id":"5e5ac9d8-727d-4ffc-af38-26682be2d429","block_type":"box","text":"services or has proprietary positions. For example, when BlackRock is engaged to provide advisory or risk","page_number":142,"box":{"x":69,"y":801,"width":755,"height":11}},{"id":"608e2aea-43f6-4b81-bf78-5a414f4a4eeb","block_type":"box","text":"management services for a company, BlackRock may be prohibited from or limited in purchasing or selling securities","page_number":142,"box":{"x":69,"y":816,"width":831,"height":11}},{"id":"f2f86c85-842f-46a9-b1e8-c8d06a5607f2","block_type":"box","text":"of that company on behalf of a Fund, par ticularly where such services result in BlackRock obtaining material non","page_number":142,"box":{"x":69,"y":831,"width":806,"height":11}},{"id":"0638cb19-e2ca-4387-bf0b-5a017f1b78a4","block_type":"box","text":"public information about the company (","page_number":142,"box":{"x":70,"y":846,"width":276,"height":11}},{"id":"218d5651-79c2-4c2a-ad65-6d664601871c","block_type":"box","text":"e.g.","page_number":142,"box":{"x":348,"y":847,"width":25,"height":10}},{"id":"5921e610-b7c2-4d7b-b564-6c846d923b07","block_type":"box","text":", in connection with par ticipation in a creditors’ committee). Moreover,","page_number":142,"box":{"x":376,"y":846,"width":499,"height":11}},{"id":"f90efb19-b9b9-4102-8aea-7f29eb9e6046","block_type":"box","text":"applicable provisions of the Investment Company Act or other regulatory considerations may restrict a Fund or","page_number":142,"box":{"x":69,"y":861,"width":784,"height":11}},{"id":"1fbf198b-3044-44cc-8c95-319b3fd31daf","block_type":"box","text":"BlackRock from effecting cer tain por tfolio transactions or taking other actions in respect of an investment on behalf","page_number":142,"box":{"x":70,"y":876,"width":827,"height":11}},{"id":"d491b835-099b-4122-8399-371fbd4b5343","block_type":"box","text":"of a Fund, including where BlackRock and/or clients advised by BlackRock already have an interest in such issuer or","page_number":142,"box":{"x":69,"y":891,"width":830,"height":12}},{"id":"d1648042-ea3d-46f1-899f-dc5a2a5670a2","block_type":"box","text":"the investment. Similar situations could arise if personnel of BlackRock serve as directors of companies the","page_number":142,"box":{"x":68,"y":906,"width":773,"height":11}},{"id":"a9950749-9eaf-4aa9-b4eb-b9c993ee845d","block_type":"box","text":"II-95","page_number":142,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"1ca8c0bf-236f-472a-ab8c-7dabdeaf8f50","block_type":"box","text":"NM1026U-6033063-142/246","page_number":142,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"bf6ed1e7-c322-491a-a55c-8133d6a98c69","block_type":"box","text":"securities of which the Funds wish to purchase or sell. However, if permitted by applicable law, and where consistent","page_number":143,"box":{"x":69,"y":45,"width":832,"height":11}},{"id":"f72c0e10-4901-4b41-bd29-c42abe00eadf","block_type":"box","text":"with BlackRock’s policies and procedures (including the necessary implementation of appropriate information","page_number":143,"box":{"x":68,"y":60,"width":781,"height":11}},{"id":"a7be24df-da40-4224-8d8c-3436901597ea","block_type":"box","text":"barriers), the Funds may purchase securities or instruments that are issued by such companies, are the subject of","page_number":143,"box":{"x":69,"y":75,"width":819,"height":11}},{"id":"721a1e8a-6aa1-4e44-9e11-213430a83b8e","block_type":"box","text":"an advisory or risk management assignment by BlackRock, or where personnel of BlackRock are directors or officers","page_number":143,"box":{"x":69,"y":90,"width":832,"height":11}},{"id":"a889585f-5c9a-4e0a-ac41-25ce8a7f99a6","block_type":"box","text":"of the issuer.","page_number":143,"box":{"x":69,"y":105,"width":92,"height":9}},{"id":"bb1403ca-224f-46ab-93d2-06ed7f64c251","block_type":"box","text":"BlackRock has adopted and implemented policies and procedures that are designed to address potential","page_number":143,"box":{"x":102,"y":128,"width":748,"height":11}},{"id":"de9ae199-cdac-4d77-a563-f3b8112d9e8a","block_type":"box","text":"conflicts that arise in connection with the advisory services BlackRock provides to Funds and other clients. Cer tain","page_number":143,"box":{"x":69,"y":143,"width":819,"height":11}},{"id":"3e95098b-d85b-4e5f-a181-3685c4d47ab5","block_type":"box","text":"BlackRock advisory personnel may take views, and make decisions or recommendations, that are different than or","page_number":143,"box":{"x":70,"y":158,"width":817,"height":11}},{"id":"9da2ccd5-9939-403e-bf3a-091dcab402bb","block_type":"box","text":"opposite those of other BlackRock advisory personnel. Cer tain por tfolio management teams within BlackRock may","page_number":143,"box":{"x":69,"y":173,"width":818,"height":11}},{"id":"3ecef13e-f2f4-4af0-abad-6c7832b9eb26","block_type":"box","text":"make decisions or take (or refrain from taking) actions with respect to clients they advise in a manner different than","page_number":143,"box":{"x":69,"y":188,"width":827,"height":12}},{"id":"1afc88df-31ec-4806-8710-51f4e2546dcf","block_type":"box","text":"or adverse to the decisions made or the actions taken (or not taken) by the Funds’ por tfolio management teams. The","page_number":143,"box":{"x":69,"y":203,"width":835,"height":12}},{"id":"5174f86e-0091-44ed-b848-b3ab45363aec","block_type":"box","text":"various por tfolio management teams may not share information with each other, including as a result of cer tain","page_number":143,"box":{"x":68,"y":218,"width":797,"height":12}},{"id":"f886a924-adbc-44ee-819b-56d2d4569572","block_type":"box","text":"information barriers and other policies, and will not have any obligation or other duty to do so.","page_number":143,"box":{"x":70,"y":234,"width":667,"height":11}},{"id":"c2a1d3fa-9171-4a1a-a5c5-01c6c6f7ada8","block_type":"box","text":"BlackRock has established cer tain information barriers and other policies to address the sharing of information","page_number":143,"box":{"x":102,"y":256,"width":794,"height":12}},{"id":"1fb194e3-c109-4856-92db-438e465c02aa","block_type":"box","text":"between different businesses within BlackRock, including with respect to personnel responsible with managing","page_number":143,"box":{"x":69,"y":271,"width":791,"height":12}},{"id":"41c27bb9-fa06-40cd-b719-ba0ad2e47a2c","block_type":"box","text":"por tfolios and voting proxies with respect to cer tain index equity por tfolios versus those responsible for managing","page_number":143,"box":{"x":70,"y":286,"width":812,"height":12}},{"id":"99d7f050-e83f-4d80-a2c8-d3e18fc7e54e","block_type":"box","text":"por tfolios and voting proxies with respect to all other por tfolios. As a result of information barriers, cer tain units of","page_number":143,"box":{"x":70,"y":302,"width":818,"height":11}},{"id":"325858af-4af6-4a21-8130-44e9d584337e","block_type":"box","text":"BlackRock generally will not have access, or will have limited access, to cer tain information and personnel, including","page_number":143,"box":{"x":70,"y":317,"width":830,"height":11}},{"id":"3550b02e-f784-44a3-be8e-7e3e56f7b1fb","block_type":"box","text":"senior personnel, in other units of BlackRock, and generally will not manage the Funds with the benefit of information","page_number":143,"box":{"x":69,"y":332,"width":835,"height":11}},{"id":"041d3abb-801c-49b1-a6b6-4880dc18cf49","block_type":"box","text":"possessed by such other units. Therefore, BlackRock may not be able to review potential investments for the Funds","page_number":143,"box":{"x":70,"y":347,"width":824,"height":11}},{"id":"c598669d-a453-4a1b-b05f-a4969be56d1c","block_type":"box","text":"with the benefit of information held by cer tain areas of BlackRock.","page_number":143,"box":{"x":68,"y":362,"width":472,"height":11}},{"id":"f4d8711f-9b48-4283-8fcf-c4d14904ba59","block_type":"box","text":"BlackRock may determine to move cer tain personnel, businesses, or business units from one side of an","page_number":143,"box":{"x":102,"y":385,"width":744,"height":11}},{"id":"f76fc4aa-7315-49ec-9063-83c00df342b0","block_type":"box","text":"information barrier to the other side of the information barrier. In connection therewith, BlackRock personnel,","page_number":143,"box":{"x":70,"y":400,"width":775,"height":11}},{"id":"22336603-ec87-4c37-ba88-befbeb60a555","block_type":"box","text":"businesses, and business units that were moved will no longer have access to the information and personnel from","page_number":143,"box":{"x":69,"y":415,"width":818,"height":11}},{"id":"785cc160-e0b3-4152-8751-71526ca5f98a","block_type":"box","text":"the side of the information barrier from which they were moved. Information obtained in connection with such","page_number":143,"box":{"x":68,"y":430,"width":779,"height":11}},{"id":"a2ea8192-ffc7-4ec3-bdff-4ea0c824becd","block_type":"box","text":"changes to information barriers may limit or restrict the ability of BlackRock to engage in or otherwise effect","page_number":143,"box":{"x":69,"y":445,"width":771,"height":12}},{"id":"8a4caade-b517-43aa-b9f2-0c573cda955e","block_type":"box","text":"transactions on behalf of the Funds (including purchasing or selling securities that BlackRock may otherwise have","page_number":143,"box":{"x":68,"y":460,"width":812,"height":12}},{"id":"d9bb3518-8100-4dea-915f-0455a82a107b","block_type":"box","text":"purchased or sold for a client in the absence of a change to an information barrier). Information barriers may not","page_number":143,"box":{"x":70,"y":475,"width":803,"height":12}},{"id":"b742168a-3c22-43d2-9cac-53183a84707f","block_type":"box","text":"have their intended impact due to, for example, changes in applicable law or inadver tent crossings of the barriers,","page_number":143,"box":{"x":69,"y":491,"width":813,"height":11}},{"id":"f1cb575a-6968-4214-bd6a-9b77773db1d1","block_type":"box","text":"and actions by personnel on one side of a barrier may impact the potential actions of personnel on the other side of","page_number":143,"box":{"x":69,"y":506,"width":829,"height":11}},{"id":"11bfc9c9-807c-4edb-a33a-2b300178f1a5","block_type":"box","text":"a barrier.","page_number":143,"box":{"x":69,"y":521,"width":62,"height":9}},{"id":"774d6eae-707c-40c8-8bc7-f51cca5fc171","block_type":"box","text":"Although the information barriers are intended to allow for independent por tfolio management decision-making","page_number":143,"box":{"x":101,"y":543,"width":788,"height":12}},{"id":"1055d9ea-4532-480b-b822-b9faf1b0db19","block_type":"box","text":"and proxy voting among cer tain BlackRock businesses, the investment activities of BlackRock for BlackRock clients,","page_number":143,"box":{"x":69,"y":559,"width":827,"height":11}},{"id":"0e30ba90-d43a-4b15-a15a-733b0f0c8514","block_type":"box","text":"as well as BlackRock’s proprietary accounts, may nonetheless limit the investment strategies and rights of other","page_number":143,"box":{"x":69,"y":574,"width":805,"height":11}},{"id":"83f3b06d-5c82-497c-a8b3-99f4862e459b","block_type":"box","text":"clients (including the Fund). As BlackRock’s assets under management increases, BlackRock clients may face greater","page_number":143,"box":{"x":69,"y":589,"width":840,"height":11}},{"id":"13565991-9bce-4b9e-beb8-758504ce5b9e","block_type":"box","text":"negative impacts due to ownership restrictions and limitations imposed by laws, regulations, rules, regulators, or","page_number":143,"box":{"x":69,"y":604,"width":806,"height":11}},{"id":"af2bb3c3-d0f3-4d41-ad17-6746340de4c9","block_type":"box","text":"issuers. For example, in cer tain circumstances where a BlackRock client invests in securities issued by companies","page_number":143,"box":{"x":70,"y":619,"width":818,"height":11}},{"id":"54f2f022-235a-4401-8c0f-9ca53ae0834b","block_type":"box","text":"that operate in cer tain industries (","page_number":143,"box":{"x":68,"y":634,"width":244,"height":11}},{"id":"7e8d3302-6d01-4d17-9025-e667278ae575","block_type":"box","text":"e.g.","page_number":143,"box":{"x":314,"y":636,"width":25,"height":10}},{"id":"4dc1bf7e-1c21-4efb-bdcf-a4a27d7761dc","block_type":"box","text":", banking, insurance, and utilities) or in cer tain emerging or international","page_number":143,"box":{"x":342,"y":634,"width":515,"height":12}},{"id":"fceff1aa-ad99-4103-81c1-fddde19c45bd","block_type":"box","text":"markets, or are subject to regulatory or corporate ownership restrictions (","page_number":143,"box":{"x":69,"y":650,"width":523,"height":11}},{"id":"71d94037-d84d-4e21-a4e9-4ca38721bc4a","block_type":"box","text":"e.g.","page_number":143,"box":{"x":594,"y":651,"width":25,"height":10}},{"id":"d0200f7f-5751-48e2-8a69-3fc275cc2800","block_type":"box","text":", with mechanisms such as poison pills","page_number":143,"box":{"x":621,"y":650,"width":280,"height":10}},{"id":"b6b508f8-538c-45d2-9f85-ff14d2dcae1c","block_type":"box","text":"in place to prevent takeovers), or where a BlackRock client invests in cer tain futures and derivatives, there may be","page_number":143,"box":{"x":70,"y":664,"width":816,"height":12}},{"id":"ce9349d9-e154-4507-a029-dda1c789bc8c","block_type":"box","text":"limits on the aggregate amount invested by BlackRock for its clients and BlackRock’s proprietary accounts that may","page_number":143,"box":{"x":70,"y":680,"width":825,"height":11}},{"id":"84a66c0d-be1d-41ae-9a26-e6813bb4641d","block_type":"box","text":"not be exceeded without the grant of a license or other regulatory or corporate approval, order, consent, relief, waiver","page_number":143,"box":{"x":69,"y":695,"width":837,"height":11}},{"id":"a98d0691-c16a-4dfe-b9c3-f01e608658cd","block_type":"box","text":"or non-disapproval or, if exceeded, may cause BlackRock or its clients to be subject to enforcement actions,","page_number":143,"box":{"x":69,"y":710,"width":769,"height":11}},{"id":"e2bee22b-0c04-4da6-b7a4-22226134d681","block_type":"box","text":"disgorgement of share ownership or profits, regulatory restrictions, complex compliance repor ting, increased","page_number":143,"box":{"x":69,"y":725,"width":775,"height":11}},{"id":"4edab7ca-15a5-47bc-86d8-65d95421cc22","block_type":"box","text":"compliance costs or suffer disadvantages or business restrictions. In light of cer tain restrictions, BlackRock may also","page_number":143,"box":{"x":69,"y":740,"width":839,"height":11}},{"id":"5457ea2e-65fc-455a-b6e3-ec2d929073ec","block_type":"box","text":"seek to make indirect investments (","page_number":143,"box":{"x":69,"y":755,"width":255,"height":11}},{"id":"49a58941-2c12-4223-a2e1-51c07f002b0e","block_type":"box","text":"e.g.","page_number":143,"box":{"x":326,"y":757,"width":24,"height":9}},{"id":"ac2d87cd-3a88-4c60-8707-615d88d27559","block_type":"box","text":", using derivatives) on behalf of its clients to receive exposure to cer tain","page_number":143,"box":{"x":353,"y":755,"width":514,"height":11}},{"id":"43ac153a-ddb0-42bf-9786-d05b78a3dadc","block_type":"box","text":"securities in excess of the applicable ownership restrictions and limitations when legally permitted that will expose","page_number":143,"box":{"x":69,"y":770,"width":817,"height":12}},{"id":"51d339cd-a135-4880-8099-22ab8762a4f2","block_type":"box","text":"such clients to additional costs and additional risks, including any risks associated with investing in derivatives.","page_number":143,"box":{"x":69,"y":786,"width":795,"height":11}},{"id":"5a276225-2ac5-4cc7-a4a2-81798315b52a","block_type":"box","text":"There may be limited availability of derivatives that provide indirect exposure to an impacted security. BlackRock","page_number":143,"box":{"x":68,"y":801,"width":799,"height":11}},{"id":"a033326d-baea-4da9-9b67-60517e5778f1","block_type":"box","text":"clients can be subject to more than one ownership limitation depending on each client’s holdings, and each","page_number":143,"box":{"x":69,"y":816,"width":767,"height":11}},{"id":"59e3e596-a9d0-4cbf-b79b-5520dc5170ca","block_type":"box","text":"ownership limitation can impact multiple securities held by the client. Cer tain clients or shareholders may have their","page_number":143,"box":{"x":69,"y":831,"width":829,"height":11}},{"id":"3aa4111a-c821-4a58-8aa2-87eeaea61817","block_type":"box","text":"own overlapping obligations to monitor their compliance with ownership limitations across their investments.","page_number":143,"box":{"x":69,"y":846,"width":772,"height":11}},{"id":"b836a44a-31d7-4500-b63d-ca812be830ec","block_type":"box","text":"If cer tain aggregate ownership thresholds are reached either through the actions of BlackRock or a BlackRock","page_number":143,"box":{"x":102,"y":869,"width":783,"height":11}},{"id":"ec11d36a-637e-4f2a-8e57-30720070c1b7","block_type":"box","text":"client or as a result of corporate actions by the issuer, the ability of BlackRock on behalf of clients to purchase or","page_number":143,"box":{"x":69,"y":884,"width":808,"height":11}},{"id":"7c0026b9-297f-4b71-883d-356b0fc863de","block_type":"box","text":"dispose of investments, or exercise rights (including voting) or under take business transactions, may be restricted by","page_number":143,"box":{"x":69,"y":899,"width":837,"height":11}},{"id":"fe47fb96-8445-4979-bf1e-371b6d6a6575","block_type":"box","text":"II-96","page_number":143,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"1f7fab63-baee-47d1-8f6b-4d342d7a762b","block_type":"box","text":"NM1026U-6033063-143/246","page_number":143,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"a3da7f65-30fa-4a78-8740-6959fa4517ec","block_type":"box","text":"law, regulation, rule, or organizational documents or otherwise impaired. For example, to meet the requirements of","page_number":144,"box":{"x":70,"y":45,"width":818,"height":11}},{"id":"88574485-6fab-48a5-9aa7-b8403be8ab3b","block_type":"box","text":"an ownership limitation or restriction, a client may be unable to purchase or directly hold a security the client would","page_number":144,"box":{"x":69,"y":60,"width":821,"height":11}},{"id":"2e5ad689-d26c-4e07-b469-a757697cc22b","block_type":"box","text":"otherwise purchase or hold. The limitation or restriction may be based on the holdings of other BlackRock clients","page_number":144,"box":{"x":69,"y":75,"width":806,"height":11}},{"id":"30ff8aef-902d-471c-b1d7-f037631157a0","block_type":"box","text":"instead of the specific client being restricted. For index funds, this means a fund may not be able to track its index as","page_number":144,"box":{"x":70,"y":90,"width":839,"height":11}},{"id":"b542e2d8-5b71-472d-a1ea-9d312e4118a9","block_type":"box","text":"closely as it would if it was not subject to an ownership limitation or restriction because the fund cannot acquire the","page_number":144,"box":{"x":69,"y":105,"width":826,"height":11}},{"id":"5c08ed22-64f2-4d4e-84b5-ebcba2f45aec","block_type":"box","text":"amount of the impacted security included in its index. BlackRock on behalf of its clients may limit purchases, sell","page_number":144,"box":{"x":69,"y":120,"width":807,"height":11}},{"id":"362d5422-2b86-4762-8367-b121e60cc6c9","block_type":"box","text":"existing investments, utilize indirect investments, utilize information barriers, or otherwise restrict, forgo, or limit the","page_number":144,"box":{"x":69,"y":135,"width":830,"height":12}},{"id":"8e722080-649d-4e37-b7da-798e21395e76","block_type":"box","text":"exercise of rights (including transferring, outsourcing, or limiting voting rights or forgoing the right to receive","page_number":144,"box":{"x":69,"y":150,"width":765,"height":12}},{"id":"998cf365-51ad-4889-9c6c-5a3a6529a003","block_type":"box","text":"dividends) when BlackRock, in its sole discretion, deems it appropriate in light of potential regulatory or other","page_number":144,"box":{"x":69,"y":166,"width":781,"height":11}},{"id":"e0bd49e7-9418-43e1-b01d-fc9db527aadb","block_type":"box","text":"restrictions on ownership or other consequences resulting from reaching investment thresholds. These types of","page_number":144,"box":{"x":69,"y":181,"width":796,"height":11}},{"id":"e378b02c-0159-4d39-973f-38f9e95da9d3","block_type":"box","text":"restrictions could negatively impact a client’s per formance or ability to meet its investment objective.","page_number":144,"box":{"x":69,"y":196,"width":720,"height":11}},{"id":"9e2a3cd9-8117-4727-842d-6231d259627c","block_type":"box","text":"When BlackRock or a BlackRock client is subject to an ownership limitation, BlackRock may in its discretion seek","page_number":144,"box":{"x":101,"y":219,"width":807,"height":11}},{"id":"cabb59b9-fbf7-4b26-83b5-1cdc27a4f1e1","block_type":"box","text":"permission from the applicable issuers or regulators to exceed the limitation. However, there is no guarantee that","page_number":144,"box":{"x":70,"y":234,"width":810,"height":11}},{"id":"0f2bdd25-2c3d-4a6c-b4b9-a1558b3f992e","block_type":"box","text":"permission will be granted, or that, once granted, it will not be modified or revoked at a later date with minimal or no","page_number":144,"box":{"x":70,"y":249,"width":829,"height":11}},{"id":"45fd1a81-9f32-475e-a687-1d115c4b3d53","block_type":"box","text":"notice. The issuer and/or regulator may also require that BlackRock on behalf of itself and its clients take or refrain","page_number":144,"box":{"x":69,"y":264,"width":824,"height":11}},{"id":"17c6581a-263a-4145-b3eb-dcfcfdca4994","block_type":"box","text":"from taking cer tain actions in connection with the approval, order, consent, relief or non-disapproval, which BlackRock","page_number":144,"box":{"x":68,"y":279,"width":841,"height":11}},{"id":"044506c8-d4fb-41ee-8315-615e0afa9cde","block_type":"box","text":"may accept if it believes the benefits outweigh the costs and may limit BlackRock from taking actions that it","page_number":144,"box":{"x":69,"y":294,"width":770,"height":11}},{"id":"61076d8f-f0c9-447c-8c43-163dfd333900","block_type":"box","text":"otherwise would take. In those circumstances where ownership thresholds or limitations must be observed,","page_number":144,"box":{"x":69,"y":309,"width":769,"height":11}},{"id":"01786b7f-86c5-4157-bd7a-1500ea8e25d7","block_type":"box","text":"BlackRock seeks to allocate limited investment oppor tunities equitably among clients, taking into consideration","page_number":144,"box":{"x":70,"y":325,"width":794,"height":11}},{"id":"d9879555-cd84-4a35-9c06-08b7a7ce606c","block_type":"box","text":"benchmark weight and investment strategy. BlackRock may adopt cer tain controls designed to prevent the","page_number":144,"box":{"x":69,"y":340,"width":757,"height":11}},{"id":"498472d2-32fc-4f6b-9117-e0655103aadf","block_type":"box","text":"occurrence of a breach of any applicable ownership threshold or limits, including, for example, when ownership in","page_number":144,"box":{"x":69,"y":355,"width":807,"height":11}},{"id":"7be064c3-8ad1-4231-bff1-637a88e8d4aa","block_type":"box","text":"cer tain securities nears an applicable threshold, BlackRock may limit additional purchases in such securities or, with","page_number":144,"box":{"x":69,"y":370,"width":833,"height":11}},{"id":"2b804bdd-33b5-432b-94d1-8a09d2ef7146","block_type":"box","text":"respect to ETFs, remove such securities from the list of Deposit Securities to be delivered to the Fund in connection","page_number":144,"box":{"x":69,"y":385,"width":827,"height":11}},{"id":"48ed7590-e4bf-4649-8650-884245e72465","block_type":"box","text":"with purchases of Creation Units of such Fund. If client holdings of an issuer exceed an applicable threshold and","page_number":144,"box":{"x":68,"y":400,"width":803,"height":11}},{"id":"c308bf25-87e4-489a-975c-612134fa7c18","block_type":"box","text":"BlackRock is unable to obtain relief to enable the continued holding of such investments, it may be necessary to","page_number":144,"box":{"x":70,"y":415,"width":802,"height":11}},{"id":"5307239c-35a3-483f-88d6-8eb7bfa9ca54","block_type":"box","text":"reduce these positions to meet the applicable limitations and BlackRock or such client may be subject to regulatory","page_number":144,"box":{"x":69,"y":430,"width":826,"height":11}},{"id":"e3ef8f7d-7e45-4b95-818f-1df60c4c6f11","block_type":"box","text":"actions. In these cases, the investments will be sold in a manner that BlackRock deems fair and equitable over time.","page_number":144,"box":{"x":69,"y":445,"width":834,"height":11}},{"id":"f7412929-3909-41aa-9805-d13167b4a108","block_type":"box","text":"Ownership limitations are highly complex. It is possible that, despite BlackRock’s intent to either comply with or","page_number":144,"box":{"x":102,"y":468,"width":795,"height":11}},{"id":"49821834-43c4-4b7c-9644-eeec9a567410","block_type":"box","text":"be granted permission to exceed ownership limitations, it may inadver tently breach a limit or violate the corporate or","page_number":144,"box":{"x":69,"y":483,"width":831,"height":11}},{"id":"b23b95a8-7248-497b-8961-0f0a0b64352c","block_type":"box","text":"regulatory approval, order, consent, relief or non-disapproval that was obtained.","page_number":144,"box":{"x":69,"y":498,"width":566,"height":11}},{"id":"943b7028-41a3-4055-805b-c027486bde3b","block_type":"box","text":"In addition to the foregoing, other ownership thresholds may trigger repor ting requirements to governmental and","page_number":144,"box":{"x":102,"y":521,"width":798,"height":11}},{"id":"c18bef24-41a1-4a8e-9107-b36e676a2f99","block_type":"box","text":"regulatory authorities, and such repor ts may entail the disclosure of the identity of a client or BlackRock’s intended","page_number":144,"box":{"x":69,"y":536,"width":823,"height":11}},{"id":"aa718753-e0c4-401a-b995-51e054c41fda","block_type":"box","text":"strategy with respect to such security or asset.","page_number":144,"box":{"x":69,"y":551,"width":333,"height":11}},{"id":"c56d962a-362f-4c21-9059-9e9bbb6b4512","block_type":"box","text":"BlackRock may maintain securities indices. To the extent permitted by applicable laws, the Funds may seek to","page_number":144,"box":{"x":102,"y":574,"width":785,"height":11}},{"id":"7a9be294-ec0f-4e5a-906d-b003e6b05c18","block_type":"box","text":"license and use such indices as par t of their investment strategy. Index based funds that seek to track the","page_number":144,"box":{"x":70,"y":589,"width":760,"height":11}},{"id":"a37f75d6-9ff5-4e38-bec2-3d911ad74190","block_type":"box","text":"per formance of securities indices also may use the name of the index or index provider in the fund name. Index","page_number":144,"box":{"x":70,"y":604,"width":796,"height":11}},{"id":"68cfeb68-c9bd-4025-9398-5f3c3892022a","block_type":"box","text":"providers, including BlackRock (to the extent permitted by applicable law), may be paid licensing fees for use of their","page_number":144,"box":{"x":70,"y":619,"width":830,"height":11}},{"id":"5962865b-0d52-43e2-bbc8-e582720d01ff","block_type":"box","text":"index or index name. In instances where BlackRock charges a unitary management fee, BlackRock may have a","page_number":144,"box":{"x":70,"y":634,"width":788,"height":12}},{"id":"116aa6f4-b069-4ca8-8d16-3d302fa95265","block_type":"box","text":"financial incentive to use a BlackRock index that is less costly to BlackRock than a third par ty index. BlackRock may","page_number":144,"box":{"x":68,"y":649,"width":829,"height":12}},{"id":"d7eaff36-376f-455b-b8dc-4e2697dd18be","block_type":"box","text":"benefit from the Funds using BlackRock indices by creating increasing acceptance in the marketplace for such","page_number":144,"box":{"x":69,"y":664,"width":784,"height":12}},{"id":"a079d72a-f52f-43a1-8bfa-9f95ae24b0fc","block_type":"box","text":"indices. BlackRock is not obligated to license its indices to a Fund and the Funds are under no obligation to use","page_number":144,"box":{"x":70,"y":680,"width":797,"height":11}},{"id":"e87d969d-819d-41de-abbf-c5c7f039c311","block_type":"box","text":"BlackRock indices. Any Fund that enters into a license for a BlackRock index cannot be assured that the terms of any","page_number":144,"box":{"x":70,"y":695,"width":837,"height":11}},{"id":"94bd1031-ae59-47f2-8283-f0cdc66d3107","block_type":"box","text":"index licensing agreement with BlackRock will be as favorable as those terms offered to other licensees.","page_number":144,"box":{"x":70,"y":710,"width":746,"height":11}},{"id":"87626fa6-b9f0-4b4d-8f42-7beed5f97e0c","block_type":"box","text":"BlackRock may enter into contractual arrangements with third-par ty service providers to a Fund (","page_number":144,"box":{"x":102,"y":733,"width":686,"height":11}},{"id":"fa191259-8d6e-450d-a995-1e90f84b5aed","block_type":"box","text":"e.g.","page_number":144,"box":{"x":790,"y":734,"width":25,"height":10}},{"id":"342bd631-eb34-4091-bb88-545d41df36a5","block_type":"box","text":", custodians,","page_number":144,"box":{"x":817,"y":733,"width":90,"height":10}},{"id":"54254865-ce87-4aee-b6ae-efaec8a945a3","block_type":"box","text":"administrators and index providers) pursuant to which BlackRock receives fee discounts or concessions in","page_number":144,"box":{"x":69,"y":748,"width":756,"height":11}},{"id":"150464f2-53cd-47fc-bd9f-e715848f3709","block_type":"box","text":"recognition of BlackRock’s overall relationship with such service providers. BlackRock may also enter into contractual","page_number":144,"box":{"x":69,"y":763,"width":836,"height":11}},{"id":"d102a489-7d65-4838-a547-467347faed95","block_type":"box","text":"arrangements with such service providers pursuant to which BlackRock incurs additional costs if the service","page_number":144,"box":{"x":69,"y":778,"width":772,"height":11}},{"id":"f8329148-1ae8-48e4-aa9e-6d373d3beda9","block_type":"box","text":"provider’s services are terminated with respect to a Fund. To the extent that BlackRock is responsible for paying","page_number":144,"box":{"x":70,"y":793,"width":800,"height":11}},{"id":"a17a9b9a-a239-4d4b-8094-7fa55ed10628","block_type":"box","text":"service providers out of its fees that it receives from the Funds, the benefits of lower fees, including any fee","page_number":144,"box":{"x":69,"y":808,"width":771,"height":11}},{"id":"5ed28c57-6651-42da-a666-b8cde3de80d1","block_type":"box","text":"discounts or concessions, or any additional savings, may accrue, in whole or in par t, to BlackRock, which could result","page_number":144,"box":{"x":69,"y":823,"width":839,"height":12}},{"id":"9970c8fa-34db-488c-879d-17cf71dc252f","block_type":"box","text":"in conflicts of interest relating to the use or termination of service providers to a Fund. In addition, conflicts of","page_number":144,"box":{"x":70,"y":838,"width":785,"height":12}},{"id":"f702ed6c-0417-4b7c-b9ab-40f835276b2b","block_type":"box","text":"interest may arise with respect to contractual arrangements with third-par ty service providers to a Fund, or the","page_number":144,"box":{"x":70,"y":854,"width":786,"height":11}},{"id":"90c1aafb-f5c8-4cce-8b6b-d7b2ac28251f","block_type":"box","text":"selection of such providers, par ticularly in circumstances where BlackRock is negotiating on behalf of both funds that","page_number":144,"box":{"x":69,"y":869,"width":837,"height":11}},{"id":"35b9d0bf-b056-4ecc-b0de-3bea337976e5","block_type":"box","text":"have a unitary management fee and those that do not or different service providers have different fee structures.","page_number":144,"box":{"x":69,"y":884,"width":809,"height":11}},{"id":"7aa52bd9-b726-4e60-9248-a210406943ae","block_type":"box","text":"II-97","page_number":144,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"fdd02cdc-a793-4e47-b8f0-ad4d4143b4c8","block_type":"box","text":"NM1026U-6033063-144/246","page_number":144,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"76466119-6603-41a5-843b-41e7bbf68a7e","block_type":"box","text":"Conflicts of interest may arise as a result of simultaneous investment management of multiple client accounts","page_number":145,"box":{"x":102,"y":45,"width":788,"height":11}},{"id":"35f14986-58a1-48fa-8712-66a6e5544fb3","block_type":"box","text":"by BlackRock’s investment professionals. For example, differences in the advisory fee structure may create the","page_number":145,"box":{"x":69,"y":60,"width":795,"height":11}},{"id":"c2d48168-907e-4bbe-a030-0b9c4862cdb3","block_type":"box","text":"appearance of actual or potential conflicts of interest because such differences could create pecuniary incentives for","page_number":145,"box":{"x":69,"y":75,"width":835,"height":11}},{"id":"d4907a13-715e-411e-871f-9b65e19d6bf5","block_type":"box","text":"BlackRock to favor one client account over another.","page_number":145,"box":{"x":70,"y":90,"width":363,"height":9}},{"id":"78f99bc5-6637-457a-b8cd-ce1478489706","block_type":"box","text":"BlackRock owns or has an ownership interest in cer tain trading, por tfolio management, operations and/or","page_number":145,"box":{"x":102,"y":113,"width":757,"height":11}},{"id":"a323a9de-424b-46d9-b47f-e0f4ac72f7f4","block_type":"box","text":"information systems used by Fund service providers. These systems are, or will be, used by a Fund service provider","page_number":145,"box":{"x":70,"y":128,"width":826,"height":11}},{"id":"8d17f3d5-44d3-4768-a60c-80fd8e5620f3","block_type":"box","text":"in connection with the provision of services to accounts managed by BlackRock and funds managed and sponsored","page_number":145,"box":{"x":70,"y":143,"width":822,"height":11}},{"id":"400d0adc-dd69-48ae-9573-6f2b52775de8","block_type":"box","text":"by BlackRock, including the Funds, that engage the service provider (typically the custodian). A Fund’s service","page_number":145,"box":{"x":69,"y":158,"width":782,"height":11}},{"id":"86787be8-05d5-447f-a2e5-b1675c100e22","block_type":"box","text":"provider remunerates BlackRock for the use of the systems. A Fund service provider’s payments to BlackRock for the","page_number":145,"box":{"x":70,"y":173,"width":835,"height":11}},{"id":"ac5e7d76-b56c-4fdb-99a6-69473d16d403","block_type":"box","text":"use of these systems may enhance the profitability of BlackRock.","page_number":145,"box":{"x":69,"y":188,"width":465,"height":11}},{"id":"c3cde091-8245-4445-bfe9-5a112bb3b38b","block_type":"box","text":"BlackRock’s receipt of fees from a service provider in connection with the use of systems provided by BlackRock","page_number":145,"box":{"x":102,"y":211,"width":804,"height":11}},{"id":"deee2a6c-fa59-4fb6-ae4e-5f78e6474929","block_type":"box","text":"may create an incentive for BlackRock to recommend that a Fund enter into or renew an arrangement with the service","page_number":145,"box":{"x":69,"y":226,"width":840,"height":11}},{"id":"6d609983-4cca-4b67-ba66-036561ee0c15","block_type":"box","text":"provider.","page_number":145,"box":{"x":70,"y":241,"width":58,"height":11}},{"id":"7604e761-2e96-4fd3-96e9-a057a5c2926b","block_type":"box","text":"In recognition of a BlackRock client’s overall relationship with BlackRock, BlackRock may offer special pricing","page_number":145,"box":{"x":102,"y":264,"width":778,"height":11}},{"id":"19adfded-56fe-45f3-a06a-7f07fe31f6ac","block_type":"box","text":"arrangements for cer tain services provided by BlackRock. Any such special pricing arrangements will not affect Fund","page_number":145,"box":{"x":69,"y":279,"width":831,"height":11}},{"id":"1729d67d-8ee9-403c-ab5e-f6cd95be45f1","block_type":"box","text":"fees and expenses applicable to such client’s investment in a Fund.","page_number":145,"box":{"x":68,"y":294,"width":485,"height":11}},{"id":"314f5ef4-4582-4973-9f20-56d5592d1360","block_type":"box","text":"Present and future activities of BlackRock and its directors, officers and employees, in addition to those","page_number":145,"box":{"x":102,"y":317,"width":742,"height":11}},{"id":"044e4234-e6a7-4dd5-a6fc-2deb7fae16c7","block_type":"box","text":"described in this section, may give rise to additional conflicts of interest.","page_number":145,"box":{"x":69,"y":332,"width":517,"height":11}},{"id":"d777dd89-a156-4e3e-ae38-6f57c7e8a9c7","block_type":"box","text":"PURCHASE OF SHARES","page_number":145,"box":{"x":395,"y":361,"width":188,"height":10}},{"id":"5f577790-64a1-4847-8415-bd5eb871d46b","block_type":"box","text":"Most BlackRock-advised open-end funds offer multiple classes of shares under a plan adopted under Rule 18f-3","page_number":145,"box":{"x":102,"y":384,"width":800,"height":11}},{"id":"07acb08a-133c-4f63-b654-8be367f92b64","block_type":"box","text":"under the Investment Company Act. Investor A Shares are sold to investors choosing the initial sales charge","page_number":145,"box":{"x":69,"y":399,"width":771,"height":12}},{"id":"975a89ac-4531-4914-9030-2771b00835de","block_type":"box","text":"alternative, except that Investor A Shares of Index Funds (defined below) and BlackRock Shor t Obligations Fund are","page_number":145,"box":{"x":69,"y":414,"width":822,"height":12}},{"id":"a0971c4a-e196-4ff1-9e55-ed83a1d9828f","block_type":"box","text":"generally not subject to an initial sales charge, and Investor C Shares are sold to investors choosing the deferred","page_number":145,"box":{"x":68,"y":429,"width":809,"height":12}},{"id":"2ae899ca-34ed-4e07-ad37-ac78eaf1fc65","block_type":"box","text":"sales charge alternative. Investor P Shares are available only to cer tain investors purchasing shares of Funds","page_number":145,"box":{"x":69,"y":445,"width":781,"height":11}},{"id":"dc6589d5-9dd5-4303-aa9f-d022a5ba28e2","block_type":"box","text":"through registered representatives of an insurance company’s broker-dealer that has entered into an agreement with","page_number":145,"box":{"x":68,"y":460,"width":833,"height":11}},{"id":"e7ae96a2-e470-4053-97d0-ea3e341315a4","block_type":"box","text":"the Distributor to offer such shares. Institutional Shares are sold to cer tain eligible investors without a sales charge.","page_number":145,"box":{"x":68,"y":475,"width":833,"height":11}},{"id":"11694204-1fd5-4b71-a988-3415c4aed687","block_type":"box","text":"Cer tain Funds offer Class R Shares, which are available only to cer tain employer-sponsored retirement plans and are","page_number":145,"box":{"x":69,"y":490,"width":835,"height":11}},{"id":"19794a08-c338-4ef8-a63d-a6953d8a04f9","block_type":"box","text":"sold without a sales charge. Cer tain Funds offer Class G Shares, which are available only to investors on eligible","page_number":145,"box":{"x":69,"y":505,"width":804,"height":11}},{"id":"a69638f9-6c27-4991-9cc0-a1e3609846d2","block_type":"box","text":"platforms, which are platforms where clients invest in the Fund through a single omnibus account in the name of a","page_number":145,"box":{"x":70,"y":520,"width":816,"height":12}},{"id":"1858d863-ce8a-41d7-9183-ebd533c386d8","block_type":"box","text":"financial intermediary that meets an initial investment minimum of $2 billion. In addition, cer tain Funds offer Service","page_number":145,"box":{"x":68,"y":535,"width":835,"height":11}},{"id":"a8a8448a-ddc2-46a5-bff5-1a1a67d30d31","block_type":"box","text":"Shares, BlackRock Shares and/or Class K Shares that are available only to cer tain eligible investors. Please see the","page_number":145,"box":{"x":69,"y":551,"width":834,"height":11}},{"id":"51999749-b8f3-4d6a-9e8a-18aa2335ee2c","block_type":"box","text":"appropriate Prospectus for your Fund to determine which classes are offered by your Fund and under what","page_number":145,"box":{"x":69,"y":566,"width":757,"height":11}},{"id":"23a82498-fb2c-4db5-a23b-3c08f2ff307c","block_type":"box","text":"circumstances. Each class has different exchange privileges. See “Shareholder Services — Exchange Privilege.”","page_number":145,"box":{"x":69,"y":581,"width":802,"height":11}},{"id":"67a60d43-048c-4c5e-b0f4-199a3f262a9f","block_type":"box","text":"The applicable offering price for purchase orders is based on the NAV of a Fund next determined after receipt of","page_number":145,"box":{"x":101,"y":603,"width":799,"height":12}},{"id":"b37dde37-bb39-4d69-a685-47ca27f77e0e","block_type":"box","text":"the purchase order by a dealer or other financial intermediary (“Selling Dealer”) that has been authorized by the","page_number":145,"box":{"x":68,"y":618,"width":798,"height":12}},{"id":"b1f628da-2aa1-4953-8bdb-c79b1a01ed5a","block_type":"box","text":"Distributor by contract to accept such orders. In addition, with respect to the affiliated underlying funds in which","page_number":145,"box":{"x":70,"y":634,"width":795,"height":11}},{"id":"2aa1709d-644b-4e02-9f4a-85a81509986b","block_type":"box","text":"target date funds advised by BlackRock or its affiliates (“BlackRock Target Date Funds”) invest, the applicable","page_number":145,"box":{"x":68,"y":649,"width":786,"height":11}},{"id":"42e8ab19-b5ff-49c9-959b-de204ee99ceb","block_type":"box","text":"offering price of each affiliated underlying fund is based on the NAV of such affiliated underlying fund next determined","page_number":145,"box":{"x":69,"y":664,"width":839,"height":11}},{"id":"fba18132-3c74-4417-a981-4118cd5aebd1","block_type":"box","text":"after a purchase order is received, or deemed to be received upon receipt by a Selling Dealer, by the BlackRock","page_number":145,"box":{"x":69,"y":679,"width":795,"height":11}},{"id":"c457a0fd-7986-4bfc-b22e-77a03759cb69","block_type":"box","text":"Target Date Funds that allocate a por tion of such purchase order to such affiliated underlying fund. As to purchase","page_number":145,"box":{"x":68,"y":694,"width":819,"height":11}},{"id":"bcf260b5-e8ee-4c24-a52b-569b420786ef","block_type":"box","text":"orders received by Selling Dealers or BlackRock Target Date Funds prior to the close of business on the New York","page_number":145,"box":{"x":69,"y":709,"width":808,"height":11}},{"id":"ed72ab42-6d04-41e1-b1c9-64b9273ee866","block_type":"box","text":"Stock Exchange (“NYSE”) (generally, the NYSE closes at 4:00 p.m. Eastern time), on the day the order is placed,","page_number":145,"box":{"x":69,"y":724,"width":803,"height":12}},{"id":"d6648a22-1b86-40d5-aace-56eac3211003","block_type":"box","text":"including orders received after the close of business on the previous day, the applicable offering price is based on","page_number":145,"box":{"x":70,"y":739,"width":812,"height":12}},{"id":"477c177a-3ebb-4f3c-b699-2e4dfcf58ccc","block_type":"box","text":"the NAV determined as of the close of business on the NYSE on that day. If the purchase orders are not received by","page_number":145,"box":{"x":68,"y":755,"width":828,"height":11}},{"id":"0676618e-d06d-443a-9c93-04335c8c81c7","block_type":"box","text":"the Selling Dealer or a BlackRock Target Date Fund before the close of business on the NYSE, such orders are","page_number":145,"box":{"x":68,"y":770,"width":788,"height":11}},{"id":"c52267e7-b294-4c2a-b82d-ad5bb4df970c","block_type":"box","text":"deemed received on the next business day. It is the responsibility of brokers to transmit purchase orders and","page_number":145,"box":{"x":69,"y":785,"width":779,"height":11}},{"id":"3a033d1a-ff26-40c6-9045-79d1b9b35c1e","block_type":"box","text":"payment on a timely basis. Generally, if payment is not received within the period described in the Prospectuses, the","page_number":145,"box":{"x":70,"y":800,"width":830,"height":11}},{"id":"3b42c199-5ca2-4a8d-83cf-6953f39ab591","block_type":"box","text":"order will be canceled, notice thereof will be given, and the broker and its customers will be responsible for any loss","page_number":145,"box":{"x":69,"y":815,"width":828,"height":11}},{"id":"1fa74767-397f-46e3-ad69-ebea03c2101c","block_type":"box","text":"to the Fund or its shareholders. Orders of less than $500 may be mailed by a broker to the Transfer Agent.","page_number":145,"box":{"x":68,"y":829,"width":762,"height":12}},{"id":"5e200f62-ec9a-4c94-a625-ea3105241588","block_type":"box","text":"The minimum investment for the initial purchase of shares is set for th in the Prospectus for each Fund. The","page_number":145,"box":{"x":101,"y":853,"width":768,"height":11}},{"id":"d7f85f1b-fe57-4713-8c58-50a29db3a2c4","block_type":"box","text":"minimum initial investment for employees of a Fund, a Fund’s Manager, Sub-Advisers or BRIL or employees of their","page_number":145,"box":{"x":69,"y":868,"width":819,"height":11}},{"id":"60b13364-5f86-40ae-ac9e-4071553b8d94","block_type":"box","text":"affiliates is $100, unless payment is made through a payroll deduction program in which case the minimum","page_number":145,"box":{"x":69,"y":882,"width":769,"height":12}},{"id":"558fe3a2-c8ce-4c3f-9d66-d296848f5b92","block_type":"box","text":"investment is $25.","page_number":145,"box":{"x":70,"y":898,"width":132,"height":10}},{"id":"684892b4-6f04-4b23-aee5-136c15d6df38","block_type":"box","text":"II-98","page_number":145,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"b1a9fd53-792e-43f9-a2e5-30b8a4895100","block_type":"box","text":"NM1026U-6033063-145/246","page_number":145,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"2fa953a3-a6b7-4d16-bac2-e02c110902dc","block_type":"box","text":"Each Fund has lower investment minimums for other categories of shareholders eligible to purchase Institutional","page_number":146,"box":{"x":102,"y":45,"width":802,"height":11}},{"id":"79a5138d-8094-4266-9b78-042944629640","block_type":"box","text":"Shares, including selected fee-based programs. Each Fund may permit a lower initial investment for cer tain investors","page_number":146,"box":{"x":69,"y":60,"width":833,"height":11}},{"id":"1eeb248f-3cae-4dd8-ae50-e94aea025a4a","block_type":"box","text":"if their purchase, combined with purchases by other investors received together by the Fund, meets the minimum","page_number":146,"box":{"x":70,"y":75,"width":806,"height":11}},{"id":"87f524dc-f9e2-4671-aaa4-3bc3a7365c5e","block_type":"box","text":"investment requirement. Each Fund may reject any purchase order, modify or waive the minimum initial or","page_number":146,"box":{"x":70,"y":90,"width":751,"height":11}},{"id":"3037b161-e425-4743-8715-ee4eef40e375","block_type":"box","text":"subsequent investment requirements and suspend and resume the sale of any share class of any Fund at any time.","page_number":146,"box":{"x":69,"y":105,"width":826,"height":11}},{"id":"1796136f-49d5-40de-a1ba-7567d545f9e4","block_type":"box","text":"Financial intermediaries may, in connection with a change in account type or otherwise in accordance with a","page_number":146,"box":{"x":102,"y":128,"width":768,"height":11}},{"id":"6992813b-aefe-43da-8aa7-f0d883098750","block_type":"box","text":"financial intermediary’s policies and procedures, exchange shares of a Fund from one class of shares to another","page_number":146,"box":{"x":68,"y":143,"width":807,"height":11}},{"id":"f1e3bbfc-5d97-4039-a80a-06256025c0c6","block_type":"box","text":"class of shares of the same Fund, provided that the exchanged shares are not subject to a contingent deferred sales","page_number":146,"box":{"x":69,"y":158,"width":836,"height":11}},{"id":"47d0c757-69e3-49a2-8c07-18e25123e111","block_type":"box","text":"charge (“CDSC”) and that shareholders meet eligibility requirements of the new share class. Please speak to your","page_number":146,"box":{"x":69,"y":173,"width":814,"height":11}},{"id":"557db775-f1c5-4fae-8fc9-d416abbd09b6","block_type":"box","text":"financial intermediary for information about specific policies and procedures applicable to your account.","page_number":146,"box":{"x":68,"y":188,"width":740,"height":11}},{"id":"04ace97a-62f8-4365-960d-3e2723588638","block_type":"box","text":"Each Fund or the Distributor may suspend the continuous offering of the Fund’s shares of any class at any time","page_number":146,"box":{"x":102,"y":211,"width":795,"height":11}},{"id":"a05beca4-0490-4ecc-844b-0e44f8d1cad7","block_type":"box","text":"in response to conditions in the securities markets or otherwise and may resume offering the shares from time to","page_number":146,"box":{"x":70,"y":226,"width":813,"height":11}},{"id":"effce6a5-8cd8-46ad-ad6d-a86179c2e7ab","block_type":"box","text":"time. Any order may be rejected by a Fund or the Distributor. Neither the Distributor, the securities dealers nor other","page_number":146,"box":{"x":68,"y":241,"width":827,"height":11}},{"id":"c3bd5a9e-9b34-478e-b390-a240a8cb5d4c","block_type":"box","text":"financial intermediaries are permitted to withhold placing orders to benefit themselves by a price change.","page_number":146,"box":{"x":68,"y":256,"width":750,"height":12}},{"id":"79320cf9-8c1d-469d-a569-cf95b8ad9054","block_type":"box","text":"The term “purchase,” as used in the Prospectus and this SAI, refers to (i) a single purchase by an individual,","page_number":146,"box":{"x":101,"y":279,"width":776,"height":11}},{"id":"a6e935c8-3484-42da-ac0f-462800c2bce0","block_type":"box","text":"(ii) concurrent purchases by an individual, his or her spouse and their children purchasing shares for his, her or their","page_number":146,"box":{"x":69,"y":294,"width":831,"height":11}},{"id":"cfbf70b1-5bb3-441e-912f-621e3f20eeec","block_type":"box","text":"own account, and (iii) single purchases by a trustee or other fiduciary purchasing shares for a single trust estate or","page_number":146,"box":{"x":69,"y":309,"width":822,"height":11}},{"id":"fd4d0e24-5e27-44cc-8e73-6926e0f3c5ec","block_type":"box","text":"single fiduciary account although more than one beneficiary may be involved. The term “purchase” also includes","page_number":146,"box":{"x":69,"y":324,"width":802,"height":12}},{"id":"2a8da456-e499-47da-9ffe-0b1f8c0d837a","block_type":"box","text":"purchases by any “company,” as that term is defined in the Investment Company Act, but does not include purchases","page_number":146,"box":{"x":70,"y":339,"width":839,"height":12}},{"id":"8abf56e6-571d-453b-93b5-726ca9e410d1","block_type":"box","text":"by (i) any company that has not been in existence for at least six months, (ii) a company that has no purpose other","page_number":146,"box":{"x":69,"y":355,"width":819,"height":11}},{"id":"b955e058-0889-4707-a697-30a75bf6da10","block_type":"box","text":"than the purchase of shares of a Fund or shares of other registered investment companies at a discount, or (iii) any","page_number":146,"box":{"x":68,"y":370,"width":827,"height":11}},{"id":"d7eee21e-2160-4f26-b955-c2a9cb815ca8","block_type":"box","text":"group of individuals whose sole organizational nexus is that its par ticipants are credit cardholders of a company,","page_number":146,"box":{"x":68,"y":385,"width":803,"height":11}},{"id":"2ebef8c3-f78e-4556-90ad-570a8245703d","block_type":"box","text":"policyholders of an insurance company, customers of either a bank or broker-dealer or clients of an investment","page_number":146,"box":{"x":70,"y":400,"width":788,"height":11}},{"id":"f1d739e6-3d3f-4410-9b5f-9b1fd7cf7529","block_type":"box","text":"adviser.","page_number":146,"box":{"x":69,"y":415,"width":53,"height":9}},{"id":"14cea9e9-3b1e-4730-9509-3d108c51a4f2","block_type":"box","text":"With cer tain limited exceptions, the Funds are generally available only to investors residing in the United States","page_number":146,"box":{"x":101,"y":438,"width":795,"height":11}},{"id":"4813ad92-9ac0-4a66-a5fa-d079a1bf4da2","block_type":"box","text":"and may not be distributed by a foreign financial intermediary. Under this policy, in order to accept new accounts or","page_number":146,"box":{"x":69,"y":453,"width":821,"height":11}},{"id":"413988db-413f-46c9-bd7c-052571aba6b8","block_type":"box","text":"additional investments (including by way of exchange from another Fund) into existing accounts, a Fund generally","page_number":146,"box":{"x":69,"y":468,"width":803,"height":11}},{"id":"20d205bf-aa62-4c33-8851-b94d656aef63","block_type":"box","text":"requires that (i) a shareholder that is a natural person be a U.S. citizen or resident alien, in each case residing within","page_number":146,"box":{"x":69,"y":483,"width":834,"height":11}},{"id":"21137eaf-0560-4c1d-81a6-494ac9034c0c","block_type":"box","text":"the United States or a U.S. territory (including APO/FPO/DPO addresses), and have a valid U.S. taxpayer","page_number":146,"box":{"x":68,"y":498,"width":747,"height":11}},{"id":"7500183c-4f8d-4721-b3f6-a0e0dbe3aeee","block_type":"box","text":"identification number, and (ii) a financial intermediary or a shareholder that is an entity be domiciled in the United","page_number":146,"box":{"x":70,"y":513,"width":809,"height":11}},{"id":"e55b0f90-ac86-4cb5-b160-55454bb42579","block_type":"box","text":"States and have a valid U.S. taxpayer identification number or be domiciled in a U.S. territory and have a valid U.S.","page_number":146,"box":{"x":69,"y":528,"width":819,"height":12}},{"id":"d76eb638-1fd3-4697-8e7d-eef1c88a442f","block_type":"box","text":"taxpayer identification number or IRS Form W-8. Any existing account that is updated to reflect a non-U.S. address will","page_number":146,"box":{"x":68,"y":543,"width":840,"height":12}},{"id":"25b9bfa8-a291-4ca5-913f-fdd1fe91c33a","block_type":"box","text":"also be restricted from making additional investments.","page_number":146,"box":{"x":69,"y":559,"width":388,"height":11}},{"id":"2c2867d6-9adb-456b-a493-df7b54b9b36f","block_type":"box","text":"In-Kind Purchases","page_number":146,"box":{"x":102,"y":582,"width":127,"height":8}},{"id":"15767d92-c062-4f6b-93e6-e2e2282ef679","block_type":"box","text":". Payment for shares of a Fund may, at the discretion of BlackRock, be made in the form of","page_number":146,"box":{"x":230,"y":581,"width":649,"height":11}},{"id":"42aabb8e-69d2-4982-bdc2-ca0d80ee82ef","block_type":"box","text":"securities that are permissible investments for the Fund and that meet the investment objective, policies and","page_number":146,"box":{"x":69,"y":596,"width":779,"height":12}},{"id":"dbba8534-04dd-43bc-8ab4-922d5b54b355","block_type":"box","text":"limitations of the Fund as described herein. In connection with an in-kind securities payment, the Fund may require,","page_number":146,"box":{"x":70,"y":612,"width":820,"height":11}},{"id":"eb6f14cb-929c-4b89-9102-a96151cac4aa","block_type":"box","text":"among other things, that the securities: (i) be valued on the day of purchase in accordance with the pricing methods","page_number":146,"box":{"x":69,"y":627,"width":827,"height":11}},{"id":"ec321f51-1cc9-403e-a0de-2d2946b7f3bb","block_type":"box","text":"used by the Fund; (ii) be accompanied by satisfactory assurance that the Fund will have good and marketable title to","page_number":146,"box":{"x":69,"y":642,"width":831,"height":11}},{"id":"617405a1-c5c0-45e3-8fac-ab5fbcd8eb07","block_type":"box","text":"such securities; (iii) not be subject to any restrictions upon resale by the Fund; (iv) be in proper form for transfer to","page_number":146,"box":{"x":69,"y":657,"width":817,"height":11}},{"id":"a4bfc28e-a8c4-4730-a721-b34523f2a726","block_type":"box","text":"the Fund; and (v) be accompanied by adequate information concerning the basis and other tax matters relating to the","page_number":146,"box":{"x":68,"y":672,"width":837,"height":11}},{"id":"40da96f2-d286-4a2f-9517-69df0b6fa5ef","block_type":"box","text":"securities. All dividends, interest, subscription or other rights per taining to such securities shall become the proper ty","page_number":146,"box":{"x":69,"y":687,"width":835,"height":11}},{"id":"8bc0b332-14bf-4c73-a4e9-5fc994ad5a9a","block_type":"box","text":"of the Fund engaged in the in-kind purchase transaction and must be delivered to the Fund by the investor upon","page_number":146,"box":{"x":69,"y":702,"width":795,"height":12}},{"id":"ac5184fb-1197-4399-b030-e771a032d84f","block_type":"box","text":"receipt from the issuer. Shares purchased in exchange for securities generally cannot be redeemed until the transfer","page_number":146,"box":{"x":69,"y":717,"width":833,"height":12}},{"id":"cc68f785-e52f-41a2-ace2-03e814dd41f9","block_type":"box","text":"has settled.","page_number":146,"box":{"x":69,"y":733,"width":83,"height":9}},{"id":"04cd4cce-9a66-4df3-a727-004e230e9c4c","block_type":"box","text":"Institutional Shares","page_number":146,"box":{"x":69,"y":763,"width":142,"height":9}},{"id":"d801e579-33bb-48af-9df0-eef477cefa21","block_type":"box","text":"Institutional Shares may be purchased at NAV without a sales charge. Only cer tain investors are eligible to","page_number":146,"box":{"x":102,"y":786,"width":759,"height":11}},{"id":"e9625c4e-d913-49c6-bc8a-c37bdc8e4000","block_type":"box","text":"purchase Institutional Shares. Investors who are eligible to purchase Institutional Shares should purchase","page_number":146,"box":{"x":70,"y":801,"width":756,"height":11}},{"id":"71e34b8d-f142-4fba-9ae0-9da0b98cc4dd","block_type":"box","text":"Institutional Shares because they are not subject to any sales charge and have lower ongoing expenses than","page_number":146,"box":{"x":70,"y":816,"width":775,"height":11}},{"id":"3fec7247-4cc8-47af-8335-d698e1837ffc","block_type":"box","text":"Investor A, Investor A1, Investor C, Investor P, Class R or Service Shares. A Fund may in its discretion waive or modify","page_number":146,"box":{"x":70,"y":831,"width":839,"height":11}},{"id":"d73ec55b-fbcb-48c1-890d-4eb2d4935fc4","block_type":"box","text":"any minimum investment amount, may reject any order for any class of shares and may suspend and resume the","page_number":146,"box":{"x":69,"y":846,"width":807,"height":11}},{"id":"e5b8e5ef-304d-4455-b6f7-37ab36348866","block_type":"box","text":"sale of shares of any Fund at any time.","page_number":146,"box":{"x":69,"y":861,"width":276,"height":11}},{"id":"22710666-5489-4d93-9152-a77c012d32bb","block_type":"box","text":"Eligible Institutional Share Investors.","page_number":146,"box":{"x":102,"y":884,"width":259,"height":11}},{"id":"952e6cf0-1ee0-45c6-bd78-94ba7a74b5c0","block_type":"box","text":"Institutional Shares of the Funds may be purchased by customers of broker","page_number":146,"box":{"x":369,"y":884,"width":540,"height":11}},{"id":"7923a748-2e74-4158-8499-27367865d7e0","block_type":"box","text":"dealers and agents that have established a servicing relationship with the Fund on behalf of their customers. These","page_number":146,"box":{"x":69,"y":899,"width":826,"height":11}},{"id":"9c54be29-db6c-4c1d-9292-6a8370d8e73f","block_type":"box","text":"II-99","page_number":146,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"bbe383a1-c61d-4e7a-ab43-7d6282e2c08a","block_type":"box","text":"NM1026U-6033063-146/246","page_number":146,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"79fdb40e-7f28-49d2-82d2-7c52f94c0e65","block_type":"box","text":"broker-dealers and agents may impose additional or different conditions on the purchase or redemption of Fund","page_number":147,"box":{"x":69,"y":45,"width":796,"height":11}},{"id":"1284329a-bae4-4053-9503-061fd9ea143d","block_type":"box","text":"shares by their customers and may charge their customers transaction, account or other fees on the purchase and","page_number":147,"box":{"x":69,"y":60,"width":819,"height":11}},{"id":"5e158da8-55a8-4bf9-98b7-98506bb6a1b3","block_type":"box","text":"redemption of Fund shares. Each broker-dealer or agent is responsible for transmitting to its customers a schedule of","page_number":147,"box":{"x":69,"y":75,"width":840,"height":11}},{"id":"4a429ed6-924b-47f4-ad90-d9a66091a384","block_type":"box","text":"any such fees and information regarding any additional or different conditions regarding purchases and redemptions.","page_number":147,"box":{"x":69,"y":90,"width":833,"height":11}},{"id":"817cbd22-fa1c-468e-951f-49ea4f1f3a56","block_type":"box","text":"Shareholders who are customers of such broker-dealers or agents should consult them for information regarding","page_number":147,"box":{"x":69,"y":105,"width":802,"height":11}},{"id":"ede9335f-27a9-456c-8615-76b1d48dbf7a","block_type":"box","text":"these fees and conditions.","page_number":147,"box":{"x":68,"y":120,"width":189,"height":9}},{"id":"17fe542e-512f-464e-963a-9101d1e50ba3","block_type":"box","text":"Payment for Institutional Shares must normally be made in Federal funds or other funds immediately available by","page_number":147,"box":{"x":102,"y":143,"width":805,"height":11}},{"id":"e841dbb1-546c-4b39-9134-0b4a01d00124","block_type":"box","text":"4 p.m. (Eastern time) on the first business day following receipt of the order. Payment may also, in the discretion of","page_number":147,"box":{"x":69,"y":158,"width":825,"height":11}},{"id":"6cccc6e4-55de-41bb-9e92-2b5a380b32b8","block_type":"box","text":"cer tain Funds, be made in the form of securities that are permissible investments for such Funds. If payment for a","page_number":147,"box":{"x":69,"y":173,"width":817,"height":11}},{"id":"f59ea611-3ba2-4b3e-872f-e2e53048afdf","block_type":"box","text":"purchase order is not received by the prescribed time, an investor may be liable for any resulting losses or expenses","page_number":147,"box":{"x":70,"y":188,"width":831,"height":12}},{"id":"e1631211-9379-4c82-b567-8000715c6b04","block_type":"box","text":"incurred by the Fund.","page_number":147,"box":{"x":70,"y":204,"width":147,"height":11}},{"id":"284e5e54-86e7-477e-961b-6f504d079346","block_type":"box","text":"Cer tain of the Funds offer Institutional Shares as described in each such Fund’s Prospectus. In addition, the","page_number":147,"box":{"x":102,"y":226,"width":774,"height":11}},{"id":"c4032637-6ce2-4256-9600-b0ae746cf93d","block_type":"box","text":"following investors may purchase Institutional Shares: employees, officers and directors/trustees of BlackRock, Inc.,","page_number":147,"box":{"x":68,"y":241,"width":834,"height":11}},{"id":"bf7c3750-700e-4177-ab84-86e4473e208b","block_type":"box","text":"BlackRock Funds, Bank of America Corporation (“BofA Corp.”), Barclays PLC or their respective affiliates and","page_number":147,"box":{"x":70,"y":256,"width":773,"height":11}},{"id":"cf0fec7a-49a2-4575-a852-366445b055b9","block_type":"box","text":"immediate family members of such persons, individuals and “Institutional Investors” with a minimum initial","page_number":147,"box":{"x":70,"y":271,"width":762,"height":12}},{"id":"18bbaa56-7bfd-413a-8a5b-cb14f0990c94","block_type":"box","text":"investment of $2 million who may purchase shares of a Fund through a financial intermediary that has entered into","page_number":147,"box":{"x":70,"y":286,"width":821,"height":12}},{"id":"c309c035-a325-4791-9df7-71ad9feee1b8","block_type":"box","text":"an agreement with the Distributor to purchase such shares (“Institutional Investors” include, but are not limited to,","page_number":147,"box":{"x":69,"y":302,"width":819,"height":11}},{"id":"e59f6bfd-6581-4f82-9c76-be4a78fa3963","block_type":"box","text":"endowments, foundations, family offices, local, city, and state governmental institutions, corporations, and insurance","page_number":147,"box":{"x":69,"y":317,"width":836,"height":11}},{"id":"89785638-b7f2-4721-b42c-d87e1dd96ef7","block_type":"box","text":"company separate accounts); employer-sponsored retirement plans (which, for this purpose, do not include SEP IRAs,","page_number":147,"box":{"x":69,"y":332,"width":837,"height":11}},{"id":"569b4647-3cbb-4257-a789-9127f506d443","block_type":"box","text":"SIMPLE IRAs or SARSEPs), state sponsored 529 college savings plans, collective trust funds, investment companies","page_number":147,"box":{"x":69,"y":347,"width":832,"height":11}},{"id":"3adef8b9-3dfd-4dce-9d43-97564205a26c","block_type":"box","text":"or other pooled investment vehicles, unaffiliated thrifts and unaffiliated banks and trust companies, each of which","page_number":147,"box":{"x":69,"y":362,"width":815,"height":11}},{"id":"6e2d353a-89b9-4c53-a670-97124836f4e8","block_type":"box","text":"may purchase shares of the Fund through a financial intermediary that has entered into an agreement with the","page_number":147,"box":{"x":69,"y":377,"width":789,"height":12}},{"id":"44318c65-cdef-46e2-9c39-840d2aa754e6","block_type":"box","text":"Distributor to purchase such shares; clients investing through a self-directed IRA brokerage account program","page_number":147,"box":{"x":70,"y":392,"width":772,"height":12}},{"id":"53f6c3b5-edbc-4c75-830f-ab0c17e03818","block_type":"box","text":"sponsored by a retirement plan record-keeper, provided that such program offers only mutual fund options and that","page_number":147,"box":{"x":69,"y":407,"width":822,"height":12}},{"id":"e692f745-d709-484d-af19-0b51946c5aea","block_type":"box","text":"the program maintains an account with the Fund on an omnibus basis; clients of financial intermediaries that:","page_number":147,"box":{"x":68,"y":423,"width":783,"height":11}},{"id":"d45d3cc5-c021-4740-9911-8298f6400a98","block_type":"box","text":"(i) charge such clients a fee for advisory, investment consulting, or similar services or (ii) have entered into an","page_number":147,"box":{"x":69,"y":438,"width":785,"height":11}},{"id":"7bc7c35b-75f9-4ed9-afd5-dce3a7904ede","block_type":"box","text":"agreement with the Distributor to offer Institutional Shares through a no-load program or investment platform, in each","page_number":147,"box":{"x":69,"y":453,"width":838,"height":11}},{"id":"7cf0d456-6ea1-48af-8514-af510e82a02a","block_type":"box","text":"case, with no minimum initial investment; clients investing through financial intermediaries that have entered into an","page_number":147,"box":{"x":69,"y":468,"width":831,"height":11}},{"id":"6385573c-8fc2-4487-af2b-ff10e8aa48a6","block_type":"box","text":"agreement with the Distributor to offer such shares on a platform that charges a transaction based sales","page_number":147,"box":{"x":69,"y":483,"width":751,"height":11}},{"id":"8c8bd751-27e0-465b-8176-2bea88ef8640","block_type":"box","text":"commission outside of the Fund, with a minimum initial investment of $1,000; tax-qualified accounts for insurance","page_number":147,"box":{"x":69,"y":498,"width":817,"height":11}},{"id":"e415c6c2-e194-4046-95ea-d395b616f08d","block_type":"box","text":"agents that are registered representatives of an insurance company’s broker-dealer that has entered into an","page_number":147,"box":{"x":69,"y":513,"width":773,"height":12}},{"id":"795bc144-6676-4b69-a76c-f10f990756e9","block_type":"box","text":"agreement with the Distributor to offer Institutional Shares, and the family members of such persons, with a","page_number":147,"box":{"x":69,"y":528,"width":771,"height":12}},{"id":"cc3b71a6-3b69-43d4-8770-e12402e6737f","block_type":"box","text":"minimum initial investment of $1,000; trust depar tment clients of Bank of America, N.A. and its affiliates for whom","page_number":147,"box":{"x":69,"y":543,"width":822,"height":11}},{"id":"658f7049-ae88-4700-a46a-872f184564b2","block_type":"box","text":"they (i) act in a fiduciary capacity (excluding par ticipant directed employee benefit plans), (ii) otherwise have","page_number":147,"box":{"x":68,"y":559,"width":771,"height":11}},{"id":"ecb06709-3d57-4684-9f01-13aa5919a20a","block_type":"box","text":"investment discretion, or (iii) act as custodian for at least $2 million in assets; and holders of cer tain BofA Corp.","page_number":147,"box":{"x":70,"y":573,"width":801,"height":12}},{"id":"b28ec913-8c7e-430e-86d3-79a553349ca4","block_type":"box","text":"sponsored unit investment trusts (UITs) who reinvest dividends received from such UITs in shares of a Fund.","page_number":147,"box":{"x":69,"y":589,"width":770,"height":11}},{"id":"be4206ff-2eb3-443d-8e92-99ddec6697a2","block_type":"box","text":"Purchase Privileges of Cer tain Persons.","page_number":147,"box":{"x":102,"y":612,"width":280,"height":11}},{"id":"d6853e1c-5156-4489-b13b-663bb089a354","block_type":"box","text":"Employees, officers, directors/trustees of BlackRock, Inc., BlackRock","page_number":147,"box":{"x":389,"y":612,"width":496,"height":11}},{"id":"13a4eccc-2c96-4263-948b-c13b62a2be2a","block_type":"box","text":"Funds, BofA Corp. or their respective affiliates; and any trust, pension, profit-sharing or other benefit plan for such","page_number":147,"box":{"x":70,"y":627,"width":812,"height":11}},{"id":"45b4a7b2-1b18-48d6-b187-6dd2f3668366","block_type":"box","text":"persons may purchase Institutional Shares at lower investment minimums than stated in each Fund’s Prospectus. A","page_number":147,"box":{"x":70,"y":642,"width":828,"height":11}},{"id":"91b243dc-fd5b-4acd-8be8-d73d94278e32","block_type":"box","text":"Fund realizes economies of scale and reduction of sales-related expenses by vir tue of the familiarity of these persons","page_number":147,"box":{"x":70,"y":657,"width":838,"height":11}},{"id":"06a7767f-390f-4906-a1a7-0d3960f05ad1","block_type":"box","text":"with the Fund. Employees, directors, and board members of other funds wishing to purchase shares of a Fund must","page_number":147,"box":{"x":68,"y":672,"width":826,"height":11}},{"id":"fa0c5873-b8fa-4175-a08a-0a9a1bf2ba82","block_type":"box","text":"satisfy the Fund’s suitability standards.","page_number":147,"box":{"x":69,"y":687,"width":279,"height":11}},{"id":"dbc1e03e-5e11-492b-af00-1c63e5d05f6f","block_type":"box","text":"Initial Sales Charge Alternative — Investor A Shares","page_number":147,"box":{"x":69,"y":718,"width":382,"height":11}},{"id":"4d1b4fdd-701e-4de2-9759-ccb82933d9ef","block_type":"box","text":"Investors who prefer an initial sales charge alternative may elect to purchase Investor A Shares. Investor A1","page_number":147,"box":{"x":102,"y":740,"width":770,"height":11}},{"id":"3623a13b-4cd2-4494-9d84-b3c33d38fb98","block_type":"box","text":"Shares are offered only (i) for purchase by cer tain employer-sponsored retirement plans and fee-based programs that","page_number":147,"box":{"x":69,"y":755,"width":837,"height":11}},{"id":"91ae0a07-a73e-42be-a4bb-eefdfd128d58","block_type":"box","text":"have been previously approved by cer tain Funds, and (ii) to cer tain investors who currently hold Investor A1 Shares","page_number":147,"box":{"x":69,"y":770,"width":819,"height":11}},{"id":"7cba1f45-fa1b-460e-a335-848caff0b3ca","block_type":"box","text":"for dividend and capital gain reinvestment only. The Investor A1 initial sales charge does not apply to the transactions","page_number":147,"box":{"x":68,"y":785,"width":840,"height":12}},{"id":"d6196a65-db0a-4864-b3cf-fa6b8bcaa1fa","block_type":"box","text":"described in (i) and (ii). For ease of reference, Investor A, Investor A1 and Investor P (discussed below) Shares are","page_number":147,"box":{"x":69,"y":801,"width":815,"height":11}},{"id":"10d8bcf2-4ded-4129-a45e-ac28fce8cd89","block_type":"box","text":"sometimes referred to herein as “front-end load shares.” Investor A Shares of Index Funds (defined below) and","page_number":147,"box":{"x":69,"y":816,"width":791,"height":11}},{"id":"5992593f-3d53-4396-945c-cc1020feed77","block_type":"box","text":"BlackRock Shor t Obligations Fund generally are not subject to an initial sales charge or front-end load.","page_number":147,"box":{"x":70,"y":831,"width":727,"height":11}},{"id":"61cc8e1b-df50-41ef-aab7-fc7732ca980f","block_type":"box","text":"Investors qualifying for significantly reduced initial sales charges may find the initial sales charge alternative","page_number":147,"box":{"x":102,"y":853,"width":770,"height":12}},{"id":"9b92c93f-eda8-4f71-aeb9-b12c878eefe9","block_type":"box","text":"par ticularly attractive because similar sales charge reductions are not available with respect to the deferred sales","page_number":147,"box":{"x":70,"y":869,"width":812,"height":11}},{"id":"0e0a97f0-6671-4548-acbc-0475f15251f0","block_type":"box","text":"charges imposed in connection with investments in Investor C Shares (sometimes referred to herein as “CDSC","page_number":147,"box":{"x":69,"y":884,"width":791,"height":11}},{"id":"65d4751b-bda0-4344-9b55-bd066c03da55","block_type":"box","text":"shares”). Investors who do not qualify for reduced initial sales charges and who expect to maintain their investment","page_number":147,"box":{"x":69,"y":899,"width":826,"height":11}},{"id":"1a446723-343c-4744-8102-805b6c9296b8","block_type":"box","text":"II-100","page_number":147,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"d1620a86-14bf-4499-8544-d4bf71a04ad7","block_type":"box","text":"NM1026U-6033063-147/246","page_number":147,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"c1a4ad14-9c7b-4057-93b6-764b10f3afcf","block_type":"box","text":"for an extended period of time also may elect to purchase Investor A Shares, because over time the accumulated","page_number":148,"box":{"x":68,"y":45,"width":808,"height":11}},{"id":"42b0fb0c-69e3-4b4d-abb1-b5be2416319d","block_type":"box","text":"ongoing service and distribution fees on CDSC shares may exceed the front-end load shares’ initial sales charge and","page_number":148,"box":{"x":69,"y":60,"width":834,"height":11}},{"id":"ea863337-4d8a-4187-b36b-1e37f75605a3","block_type":"box","text":"service fee. Although some investors who previously purchased Institutional Shares may no longer be eligible to","page_number":148,"box":{"x":69,"y":75,"width":798,"height":11}},{"id":"59d88eb2-d78d-42f2-8d10-715354b27466","block_type":"box","text":"purchase Institutional Shares of other Funds, those previously purchased Institutional Shares, together with all","page_number":148,"box":{"x":70,"y":90,"width":789,"height":11}},{"id":"a4600080-4a53-43ae-baa1-d733b8ce939b","block_type":"box","text":"BlackRock front-end load and CDSC share holdings, will count toward a right of accumulation that may qualify the","page_number":148,"box":{"x":70,"y":105,"width":805,"height":11}},{"id":"0d956bdf-82e3-4041-927b-18a62a786121","block_type":"box","text":"investor for a reduced initial sales charge on new initial sales charge purchases. In addition, the ongoing CDSC","page_number":148,"box":{"x":70,"y":120,"width":792,"height":12}},{"id":"66cdb5b9-0313-48b9-bd6e-eb1a21d10c2d","block_type":"box","text":"shares service and distribution fees will cause CDSC shares to have higher expense ratios, pay lower dividends and","page_number":148,"box":{"x":69,"y":135,"width":826,"height":12}},{"id":"eaa984fb-d3b6-44fa-aec1-d70c5ade7a29","block_type":"box","text":"have lower total returns than the initial sales charge shares. The ongoing front-end load shares’ service fees will","page_number":148,"box":{"x":69,"y":150,"width":802,"height":12}},{"id":"ef564457-4eec-4261-9584-70c5ba30bbdf","block_type":"box","text":"cause Investor A, Investor A1, Investor P and Service Shares to have a higher expense ratio, pay lower dividends and","page_number":148,"box":{"x":69,"y":166,"width":834,"height":11}},{"id":"41047b1f-a89e-4d3c-a14c-3818b88596fe","block_type":"box","text":"have a lower total return than Institutional Shares.","page_number":148,"box":{"x":69,"y":181,"width":358,"height":9}},{"id":"9d2b4b68-fc16-40d2-93ff-6ea3d2e8e725","block_type":"box","text":"See “Information on Sales Charges and Distribution Related Expenses” in Par t I of each Fund’s SAI for","page_number":148,"box":{"x":102,"y":203,"width":734,"height":12}},{"id":"d619896c-da72-48f2-9dca-b3d6e977a86b","block_type":"box","text":"information about amounts paid to the Distributor in connection with Investor A and Investor A1 Shares for the","page_number":148,"box":{"x":70,"y":218,"width":785,"height":11}},{"id":"4e4b80a1-a62d-4eff-9ab7-63b05a93899f","block_type":"box","text":"periods indicated.","page_number":148,"box":{"x":70,"y":234,"width":124,"height":11}},{"id":"32cda72d-059b-4999-a6ae-f314d115cf06","block_type":"box","text":"The Distributor may reallow discounts to selected securities dealers and other financial intermediaries and retain","page_number":148,"box":{"x":101,"y":256,"width":806,"height":11}},{"id":"2ed57f24-a508-4d54-89a3-f2eb7c3e4b2d","block_type":"box","text":"the balance over such discounts. At times the Distributor may reallow the entire sales charge to such dealers. Since","page_number":148,"box":{"x":68,"y":272,"width":830,"height":11}},{"id":"f8b3a560-ccf8-4413-b125-a654b253c2bd","block_type":"box","text":"securities dealers and other financial intermediaries selling front-end load shares of a Fund will receive a concession","page_number":148,"box":{"x":69,"y":286,"width":832,"height":12}},{"id":"ffe28374-d131-4822-b07a-5ca1a27e7604","block_type":"box","text":"equal to most of the sales charge, they may be deemed to be underwriters under the Securities Act.","page_number":148,"box":{"x":69,"y":302,"width":714,"height":11}},{"id":"0bc8ed8c-0677-4f65-b7ba-f8bb648c48e1","block_type":"box","text":"Initial Sales Charge — Investor P Shares","page_number":148,"box":{"x":69,"y":332,"width":297,"height":11}},{"id":"85af4d3c-fac1-49ee-b459-b37e8141463b","block_type":"box","text":"Cer tain Funds offer Investor P Shares as described in each such Fund’s Prospectus, Investor P Shares are","page_number":148,"box":{"x":102,"y":355,"width":761,"height":11}},{"id":"03720c45-2c06-4a21-b12c-9220c9a46704","block_type":"box","text":"available for purchase only through registered representatives of an insurance company’s broker-dealer that has","page_number":148,"box":{"x":69,"y":370,"width":800,"height":11}},{"id":"fee15577-f948-4630-801d-3f92a61bf2e0","block_type":"box","text":"entered into an agreement with the Distributor to offer such shares and are subject to an initial sales charge. The","page_number":148,"box":{"x":69,"y":385,"width":812,"height":11}},{"id":"ced38cd9-5416-4b5c-963d-4108e127e3a5","block_type":"box","text":"ongoing front-end load shares’ service fees will cause Investor P Shares to have a higher expense ratio, pay lower","page_number":148,"box":{"x":69,"y":400,"width":813,"height":11}},{"id":"cf4294ca-b910-4fc2-89b1-5f8174714daf","block_type":"box","text":"dividends and have a lower total return than Investor A Shares of the same Fund.","page_number":148,"box":{"x":69,"y":415,"width":578,"height":9}},{"id":"2fa9f851-5357-43cc-a39d-a6070b99f4fb","block_type":"box","text":"See “Information on Sales Charges and Distribution Related Expenses” in Par t I of each Fund’s SAI for","page_number":148,"box":{"x":102,"y":438,"width":734,"height":11}},{"id":"e62636a6-3aa5-4b2a-aab6-e0d76439f471","block_type":"box","text":"information about amounts paid to the Distributor in connection with Investor P Shares for the periods indicated.","page_number":148,"box":{"x":70,"y":453,"width":800,"height":11}},{"id":"24ea1a49-bb55-4f1b-9e95-4ad4f3c7f57c","block_type":"box","text":"The Distributor may reallow discounts to selected securities dealers and other financial intermediaries and retain","page_number":148,"box":{"x":101,"y":475,"width":806,"height":12}},{"id":"f52bbb7c-5e81-4f8a-96c4-6322b7f87d7b","block_type":"box","text":"the balance over such discounts. At times the Distributor may reallow the entire sales charge to such dealers. Since","page_number":148,"box":{"x":68,"y":491,"width":830,"height":11}},{"id":"2850704b-745b-4c53-90fa-e399550de412","block_type":"box","text":"securities dealers and other financial intermediaries selling front-end load shares of a Fund will receive a concession","page_number":148,"box":{"x":69,"y":506,"width":832,"height":11}},{"id":"eefd54c1-1c3b-41e0-b04c-42eb81395867","block_type":"box","text":"equal to most of the sales charge, they may be deemed to be underwriters under the Securities Act.","page_number":148,"box":{"x":69,"y":521,"width":714,"height":11}},{"id":"2b533a23-f47d-4064-a6a0-17df1cfe7c05","block_type":"box","text":"Reduced Initial Sales Charges","page_number":148,"box":{"x":69,"y":551,"width":219,"height":11}},{"id":"cd574bcd-959f-4724-ae34-d05f8ff7c0fd","block_type":"box","text":"Cer tain investors may be eligible for a reduction in or waiver of a sales load due to the nature of the investors","page_number":148,"box":{"x":102,"y":574,"width":782,"height":11}},{"id":"eb28c92e-1a20-4bd6-abc5-b9b6f36d2c1c","block_type":"box","text":"and/or the reduced sales effor ts necessary to obtain their investments. Financial intermediaries may, in connection","page_number":148,"box":{"x":69,"y":589,"width":827,"height":11}},{"id":"7b2ae4d5-0452-45fd-8378-4f612b66d24c","block_type":"box","text":"with a change in account type or otherwise in accordance with a financial intermediary’s policies and procedures,","page_number":148,"box":{"x":68,"y":604,"width":809,"height":11}},{"id":"85dc79c4-eb62-4ae2-95bb-c898751eaab7","block_type":"box","text":"exchange shares of a Fund from one class of shares to another class of shares of the same Fund provided that the","page_number":148,"box":{"x":69,"y":619,"width":823,"height":11}},{"id":"d398b8da-61a0-42a7-9e20-26ce40a37130","block_type":"box","text":"exchanged shares are not subject to a contingent deferred sales charge and that shareholders meet the eligibility","page_number":148,"box":{"x":69,"y":634,"width":812,"height":12}},{"id":"a1560b67-d494-486e-91ff-b81384930da7","block_type":"box","text":"requirements of the new share class. Cer tain sales load reductions and waivers may be available to customers of","page_number":148,"box":{"x":69,"y":649,"width":813,"height":12}},{"id":"b1a63509-946d-4500-bb3b-b65880a98be4","block_type":"box","text":"cer tain financial intermediaries, as described under “Intermediary-Defined Sales Charge Waiver Policies” in the","page_number":148,"box":{"x":69,"y":664,"width":793,"height":12}},{"id":"5206cebc-65ff-43f9-8488-a46e3686ff82","block_type":"box","text":"Fund’s Prospectus. Please speak to your financial intermediary for more information.","page_number":148,"box":{"x":70,"y":680,"width":603,"height":11}},{"id":"7df6800b-aad0-41f7-9178-476574778add","block_type":"box","text":"Reinvested Dividends.","page_number":148,"box":{"x":102,"y":703,"width":156,"height":8}},{"id":"2358daa8-2830-477c-b56b-33325dce34f5","block_type":"box","text":"No sales charges are imposed upon shares issued as a result of the automatic","page_number":148,"box":{"x":265,"y":702,"width":566,"height":12}},{"id":"81c24fc3-de7e-4be2-a3c0-ede49a8b9450","block_type":"box","text":"reinvestment of dividends.","page_number":148,"box":{"x":69,"y":717,"width":186,"height":9}},{"id":"477c35d1-0788-4978-8dba-f9e1e491650a","block_type":"box","text":"Right of Accumulation.","page_number":148,"box":{"x":102,"y":740,"width":158,"height":11}},{"id":"ad730d1a-8ed8-4406-b638-60f603fcb69f","block_type":"box","text":"Investors have a “right of accumulation” under which any of the following may be","page_number":148,"box":{"x":267,"y":740,"width":574,"height":11}},{"id":"6a5ea8f5-e676-4075-bc07-57a7c8fa13b0","block_type":"box","text":"combined with the amount of the current purchase in determining whether an investor qualifies for a breakpoint and","page_number":148,"box":{"x":69,"y":755,"width":826,"height":11}},{"id":"9790f63c-af85-4275-86b8-cbab714efe45","block_type":"box","text":"a reduced front-end sales charge: (i) the current value of an investor’s existing Investor A, Investor A1, Investor C,","page_number":148,"box":{"x":69,"y":770,"width":810,"height":12}},{"id":"c63219a9-3e2f-450b-8fc4-06644bea2614","block_type":"box","text":"Investor P, Institutional, Class K and Premier Shares in most BlackRock Funds, (ii) the current value of an investor’s","page_number":148,"box":{"x":70,"y":785,"width":825,"height":11}},{"id":"c91dfeb0-e45b-419e-8db1-013fc473fa5b","block_type":"box","text":"existing shares of cer tain unlisted closed-end management investment companies sponsored and advised by","page_number":148,"box":{"x":69,"y":801,"width":780,"height":11}},{"id":"350021f7-2719-4fda-9ba3-c8111e47e8df","block_type":"box","text":"BlackRock or its affiliates (“Eligible Unlisted BlackRock Closed-End Funds”) and (iii) the investment in the BlackRock","page_number":148,"box":{"x":70,"y":816,"width":828,"height":11}},{"id":"1b36b79b-ee78-4510-9599-dd7c2b35cff1","block_type":"box","text":"CollegeAdvantage 529 Program by the investor or by or on behalf of the investor’s spouse and children. Financial","page_number":148,"box":{"x":69,"y":831,"width":804,"height":11}},{"id":"90f66835-5b63-48a4-8f86-a776e7d2c70f","block_type":"box","text":"intermediaries may value current holdings of their customers differently for purposes of determining whether an","page_number":148,"box":{"x":70,"y":846,"width":794,"height":11}},{"id":"63ad0aac-63b6-468e-a909-81006e1081d9","block_type":"box","text":"investor qualifies for a breakpoint and a reduced front-end sales charge, although customers of the same financial","page_number":148,"box":{"x":70,"y":861,"width":814,"height":11}},{"id":"b2eb6979-568d-474b-82e7-742870be77e9","block_type":"box","text":"intermediary will be treated similarly. In order to use this right, the investor must aler t BlackRock to the existence of","page_number":148,"box":{"x":70,"y":876,"width":828,"height":11}},{"id":"728192fc-d899-45fb-88f7-e6246e0c0c4e","block_type":"box","text":"any previously purchased shares. Cer tain funds employ a “passive” management approach and attempt to match the","page_number":148,"box":{"x":69,"y":891,"width":838,"height":12}},{"id":"5a5b1e26-d9f1-4b12-b52d-084d6d67cdc3","block_type":"box","text":"per formance of a target index as closely as possible before the deduction of Fund expenses (“Index Funds”).","page_number":148,"box":{"x":70,"y":906,"width":776,"height":12}},{"id":"9bfcfc05-bc60-451c-9151-0f351be18c50","block_type":"box","text":"II-101","page_number":148,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"349c57ff-2f70-4b15-bcb9-a8850bf5fc1d","block_type":"box","text":"NM1026U-6033063-148/246","page_number":148,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"0b1af287-f903-4e01-ae5c-0bbd6c2428f2","block_type":"box","text":"Although Investor A Shares of Index Funds and BlackRock Shor t Obligations Fund generally are not subject to a sales","page_number":149,"box":{"x":68,"y":45,"width":835,"height":11}},{"id":"3c823dcf-7179-4866-89fe-a2e8ff537b3f","block_type":"box","text":"charge, an investor’s existing Investor A, Investor A1, Investor C, Investor P, Institutional, Class K and Premier Shares","page_number":149,"box":{"x":69,"y":60,"width":839,"height":11}},{"id":"742f406d-12f9-444a-b40b-23ce39496375","block_type":"box","text":"in the Index Funds and BlackRock Shor t Obligations Fund may be combined with the amount of an investor’s current","page_number":149,"box":{"x":70,"y":75,"width":829,"height":11}},{"id":"b959cd7b-2d2c-4e4b-a3d1-bc9bea93b639","block_type":"box","text":"purchase in determining whether an investor qualifies for a breakpoint and a reduced front-end sales charge.","page_number":149,"box":{"x":70,"y":90,"width":774,"height":11}},{"id":"bf09f975-0067-4dae-95c4-69d42fd5a1f1","block_type":"box","text":"Letter of Intent.","page_number":149,"box":{"x":102,"y":113,"width":109,"height":9}},{"id":"2b392717-0c92-4159-b4ea-8a56e8d5fac8","block_type":"box","text":"An investor may qualify for a reduced front-end sales charge immediately by signing a “Letter of","page_number":149,"box":{"x":217,"y":113,"width":681,"height":11}},{"id":"9f67f95d-5a88-43e4-87c1-73bc193bd295","block_type":"box","text":"Intent” stating the investor’s intention to make one or more of the following investments within the next 13 months","page_number":149,"box":{"x":70,"y":128,"width":820,"height":11}},{"id":"c333295a-a9d8-40b3-bdf8-3a176f227455","block_type":"box","text":"which would, if bought all at once, qualify the investor for a reduced sales charge: (i) buy a specified amount of","page_number":149,"box":{"x":68,"y":143,"width":792,"height":11}},{"id":"a0a09d5e-e2c9-4c79-9fcb-2623d90c955e","block_type":"box","text":"Investor A, Investor C, Investor P, Institutional, Class K and/or Premier Shares, (ii) make an investment in one or","page_number":149,"box":{"x":70,"y":158,"width":802,"height":11}},{"id":"8c6f8ad0-7258-43f7-801d-66a97897db89","block_type":"box","text":"more Eligible Unlisted BlackRock Closed-End Funds and/or (iii) make an investment through the BlackRock","page_number":149,"box":{"x":69,"y":173,"width":760,"height":11}},{"id":"4e27074c-fc37-49f6-ac3b-eef8f96cd0bf","block_type":"box","text":"CollegeAdvantage 529 Program in one or more BlackRock Funds. The initial investment must meet the minimum","page_number":149,"box":{"x":69,"y":188,"width":800,"height":12}},{"id":"201146ce-81b5-4bee-a554-461dbe7b0a24","block_type":"box","text":"initial purchase requirement. The 13-month Letter of Intent period commences on the day that the Letter of Intent is","page_number":149,"box":{"x":70,"y":203,"width":826,"height":12}},{"id":"3b084a88-1829-454f-a6ba-e96ace3b61b2","block_type":"box","text":"received by the Fund. The market value of current holdings in the BlackRock Funds (including Investor A, Investor C,","page_number":149,"box":{"x":69,"y":218,"width":822,"height":12}},{"id":"e228e30d-925e-4223-9858-10530b33b5cb","block_type":"box","text":"Investor P, Institutional, Class K and Premier Shares, Eligible Unlisted BlackRock Closed-End Funds and the","page_number":149,"box":{"x":70,"y":234,"width":764,"height":11}},{"id":"e7df4512-3512-43c8-a6bf-ba982e9a46e4","block_type":"box","text":"BlackRock CollegeAdvantage 529 Program Class A and Class C Units) as of the date of commencement that are","page_number":149,"box":{"x":70,"y":249,"width":800,"height":11}},{"id":"059fa430-9ccd-4d51-a7c6-21431f17d197","block_type":"box","text":"eligible under the Right of Accumulation may be counted towards the sales charge reduction. The investor must notify","page_number":149,"box":{"x":69,"y":264,"width":838,"height":11}},{"id":"167c6aa3-ea3c-4d6c-ad51-e15dd79d614d","block_type":"box","text":"the Fund of (i) any current holdings in the BlackRock Funds, Eligible Unlisted BlackRock Closed-End Funds and/or the","page_number":149,"box":{"x":68,"y":279,"width":835,"height":11}},{"id":"2f2aabea-84f3-4cc9-81a2-e6f1121ef864","block_type":"box","text":"BlackRock CollegeAdvantage 529 Program that should be counted towards the sales charge reduction and (ii) any","page_number":149,"box":{"x":70,"y":294,"width":811,"height":11}},{"id":"71963606-d44e-4b50-88a6-cfb0b68e33fa","block_type":"box","text":"subsequent purchases that should be counted towards the Letter of Intent. During the term of the Letter of Intent,","page_number":149,"box":{"x":69,"y":309,"width":814,"height":11}},{"id":"e2669755-245b-4e19-80dc-230b6e0a047d","block_type":"box","text":"the Fund will hold Investor A Shares and/or Investor P Shares, as applicable, representing up to 5% of the indicated","page_number":149,"box":{"x":68,"y":324,"width":827,"height":12}},{"id":"83b031fd-1de1-4bbe-8b54-26e1245a168c","block_type":"box","text":"amount in an escrow account for payment of a higher sales load if the full amount indicated in the Letter of Intent is","page_number":149,"box":{"x":69,"y":339,"width":827,"height":12}},{"id":"fa7d112e-0799-4304-a241-2e3a8a9064ba","block_type":"box","text":"not purchased. If the full amount indicated is not purchased within the 13-month period, and the investor does not","page_number":149,"box":{"x":69,"y":355,"width":817,"height":11}},{"id":"e30d5b9c-2074-4d27-9bc9-515863e3419e","block_type":"box","text":"pay the higher sales load within 20 days, the Fund will redeem enough of the Investor A Shares and/or Investor P","page_number":149,"box":{"x":70,"y":370,"width":807,"height":11}},{"id":"2f7866f1-12f4-4d17-9b97-86111765bfc2","block_type":"box","text":"Shares, as applicable, held in escrow to pay the difference.","page_number":149,"box":{"x":69,"y":385,"width":423,"height":11}},{"id":"d7dc5618-04df-4cb9-99ae-31e88b2d0fff","block_type":"box","text":"Placement Fees.","page_number":149,"box":{"x":102,"y":408,"width":116,"height":8}},{"id":"50292c49-bf2b-47e6-bcd4-fe428cd0e886","block_type":"box","text":"BlackRock may pay placement fees to dealers on purchases of Investor A and Investor P Shares of all Funds,","page_number":149,"box":{"x":102,"y":430,"width":777,"height":11}},{"id":"9626f8e0-a5c5-4f7e-89b7-5aa210f0b1c7","block_type":"box","text":"which may depend on the policies, procedures and trading platforms of your financial intermediary.","page_number":149,"box":{"x":68,"y":445,"width":704,"height":12}},{"id":"8943f90b-3ee4-4659-be4c-e8b8a492ab2a","block_type":"box","text":"Except as noted below, these placement fees may be up to the following amounts for Investor A Shares:","page_number":149,"box":{"x":102,"y":468,"width":741,"height":11}},{"id":"bfe09213-ee7a-47a8-a036-94eaf17e42b6","block_type":"box","text":"$1 million but less than $3 million . . . . . . . . . . . . . .","page_number":149,"box":{"x":167,"y":495,"width":361,"height":10}},{"id":"f941289f-8dc6-4aaf-b16d-734f45364b47","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.00%","page_number":149,"box":{"x":535,"y":496,"width":288,"height":9}},{"id":"c28fb37d-72d5-4c80-8c38-bc6494f97c73","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":149,"box":{"x":167,"y":510,"width":361,"height":11}},{"id":"21bde7e9-8fac-402f-8ebc-97286b6e9d87","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":149,"box":{"x":535,"y":511,"width":288,"height":9}},{"id":"90a9928d-b77d-4c21-8220-eabb0f7b50f1","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":149,"box":{"x":167,"y":525,"width":345,"height":11}},{"id":"1078fcc3-4433-4920-afd2-b02bad87fe67","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":149,"box":{"x":518,"y":526,"width":305,"height":9}},{"id":"422e4ee3-41bb-4084-aa31-afe67fa2ca04","block_type":"box","text":"With respect to Investor A Shares of BlackRock Global Allocation Fund, Inc., BlackRock Dynamic High Income","page_number":149,"box":{"x":101,"y":550,"width":776,"height":11}},{"id":"ee320518-6f90-49c3-b7d1-1e78deda5285","block_type":"box","text":"Por tfolio (for shares purchased prior to July 1, 2020) and BlackRock Multi-Asset Income Por tfolio (for shares","page_number":149,"box":{"x":69,"y":565,"width":774,"height":11}},{"id":"cb23c9c9-6282-42bf-b0f6-9c589f936015","block_type":"box","text":"purchased prior to July 1, 2020) of BlackRock Funds II, BlackRock Credit Relative Value Fund of BlackRock Funds IV","page_number":149,"box":{"x":70,"y":580,"width":824,"height":11}},{"id":"1723aae5-6394-44d3-af76-eea752a89669","block_type":"box","text":"and BlackRock Event Driven Equity Fund, the placement fees may be up to the following amounts:","page_number":149,"box":{"x":69,"y":595,"width":695,"height":11}},{"id":"82db0713-2fc5-4d94-bd78-4b7765d2f1ee","block_type":"box","text":"$250,000 but less than $3 million . . . . . . . . . . . . . . . . . . . .","page_number":149,"box":{"x":167,"y":622,"width":410,"height":11}},{"id":"5ab5737e-93ac-4d1f-818e-d7c0df129676","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . 1.00%","page_number":149,"box":{"x":583,"y":623,"width":240,"height":9}},{"id":"c302ffee-6fd7-41f8-a12c-3dda1b76cf87","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":149,"box":{"x":167,"y":637,"width":361,"height":11}},{"id":"e11eb42c-5e15-4b03-a226-1fe8526b41c3","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":149,"box":{"x":535,"y":638,"width":288,"height":9}},{"id":"ad08f88a-d100-40a0-9b7a-92a05cc4d886","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":149,"box":{"x":167,"y":652,"width":345,"height":11}},{"id":"0cce7e2e-9fe7-470a-aee9-34707bb98afc","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":149,"box":{"x":518,"y":653,"width":305,"height":9}},{"id":"fbdcecb2-8ea3-4666-b469-95b03375ca50","block_type":"box","text":"With respect to Investor A Shares of BlackRock Systematic Multi-Strategy Fund of BlackRock Funds IV, BlackRock","page_number":149,"box":{"x":101,"y":677,"width":806,"height":11}},{"id":"6854967e-59a6-4b72-b739-564afdeb720c","block_type":"box","text":"Advantage CoreAlpha Bond Fund of BlackRock Funds VI, BlackRock Tactical Oppor tunities Fund of BlackRock Funds","page_number":149,"box":{"x":68,"y":692,"width":821,"height":11}},{"id":"a2ef07b1-0aa5-468c-8c0c-dd6b943d30b8","block_type":"box","text":"SM","page_number":149,"box":{"x":890,"y":693,"width":11,"height":4}},{"id":"34c8dc3a-77b5-4b21-8fc4-9e42a06d8a7f","block_type":"box","text":",","page_number":149,"box":{"x":903,"y":700,"width":2,"height":3}},{"id":"5da2ce28-1e7d-4051-82b0-542b1d853526","block_type":"box","text":"BlackRock High Yield Por tfolio, BlackRock Core Bond Por tfolio and BlackRock Sustainable High Yield Bond Fund of","page_number":149,"box":{"x":70,"y":707,"width":816,"height":12}},{"id":"d1f8c5e8-46b9-4601-ab7c-2a08eb5c4b24","block_type":"box","text":"BlackRock Funds V, BlackRock Securitized Income Fund of Managed Account Series II and BlackRock Strategic Global","page_number":149,"box":{"x":70,"y":722,"width":835,"height":12}},{"id":"b1375781-0f75-4d08-b03f-4b62be0b3d36","block_type":"box","text":"Bond Fund, Inc., the placement fees may be up to the following amounts:","page_number":149,"box":{"x":70,"y":738,"width":520,"height":11}},{"id":"813b8169-ba49-4b92-b8b3-04f1facd39e4","block_type":"box","text":"$1 million but less than $3 million . . . . . . . . . . . . . .","page_number":149,"box":{"x":167,"y":765,"width":361,"height":10}},{"id":"dae9cfd9-d3d8-4bd8-8636-70de3a956b65","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.75%","page_number":149,"box":{"x":535,"y":765,"width":288,"height":9}},{"id":"3d7094e2-334f-462b-94c5-6659da3de0de","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":149,"box":{"x":167,"y":780,"width":361,"height":10}},{"id":"4f3eb8fd-2fd3-4407-a3cf-548993ff91c1","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":149,"box":{"x":535,"y":780,"width":288,"height":9}},{"id":"a0f7ae24-d88f-4ce4-9458-8cb186ccc35b","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":149,"box":{"x":167,"y":795,"width":345,"height":10}},{"id":"8c6f65f4-9806-45ff-a8af-c2e9fd02d3a9","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":149,"box":{"x":518,"y":796,"width":305,"height":8}},{"id":"69cc0a62-ba08-475b-b7f9-d407995d4725","block_type":"box","text":"With respect to Investor A Shares of BlackRock Mor tgage-Backed Securities Fund and BlackRock Impact","page_number":149,"box":{"x":101,"y":819,"width":743,"height":12}},{"id":"aca5c5e3-a65e-45d9-b96b-26ea617c5421","block_type":"box","text":"Mor tgage Fund of BlackRock Funds V, the placement fees may be up to the following amounts:","page_number":149,"box":{"x":70,"y":835,"width":674,"height":11}},{"id":"88cd8716-dec9-40f8-a9c7-ffae35d38b66","block_type":"box","text":"$1 million but less than $3 million . . . . . . . . . . . . . .","page_number":149,"box":{"x":167,"y":862,"width":361,"height":10}},{"id":"fa7d5e00-491f-44fb-9d46-4449a3174df3","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":149,"box":{"x":535,"y":862,"width":288,"height":9}},{"id":"c8a94cdd-8f94-4ace-864e-67cf1fbc9baf","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":149,"box":{"x":167,"y":877,"width":361,"height":10}},{"id":"d94e48da-919d-4880-96bb-ac45b8778eee","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":149,"box":{"x":535,"y":878,"width":288,"height":8}},{"id":"b3b95bb2-93e8-414b-b963-509b28982f03","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":149,"box":{"x":167,"y":892,"width":345,"height":10}},{"id":"e1c144be-3063-430f-862b-33e23bd8d0a3","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.15%","page_number":149,"box":{"x":518,"y":893,"width":305,"height":9}},{"id":"97898fd0-a0c2-4f97-9241-e2fd79729b93","block_type":"box","text":"II-102","page_number":149,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"530db8f0-b156-4a23-9850-41618cab55d7","block_type":"box","text":"NM1026U-6033063-149/246","page_number":149,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"db530846-da98-4dde-ab0d-7e0d05ef185a","block_type":"box","text":"With respect to Investor A Shares of BlackRock Managed Income Fund of BlackRock Funds II, the placement fees","page_number":150,"box":{"x":101,"y":45,"width":808,"height":11}},{"id":"f042363f-8b10-4c96-b901-79d7aecf508c","block_type":"box","text":"may be up to the following amounts:","page_number":150,"box":{"x":69,"y":60,"width":257,"height":11}},{"id":"2ede1a9e-6af3-4f71-8e28-9b4b196e60e3","block_type":"box","text":"$250,000 but less than $3 million . . . . . . . . . . . . . . . . . . . .","page_number":150,"box":{"x":167,"y":87,"width":410,"height":11}},{"id":"be1c771a-0e14-4de0-9bc1-b36f8b12735f","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":150,"box":{"x":583,"y":88,"width":240,"height":8}},{"id":"81205857-e119-4752-b433-eb18d2236497","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":150,"box":{"x":167,"y":102,"width":361,"height":10}},{"id":"d609e22d-a15a-4580-b9c8-b7bb1b8544e0","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":150,"box":{"x":535,"y":103,"width":288,"height":9}},{"id":"73c8907a-ef21-4f92-bd8c-f6051bed5784","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":150,"box":{"x":167,"y":117,"width":345,"height":11}},{"id":"4cce6c86-dec6-4bea-9de8-f25dcf0156fe","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.15%","page_number":150,"box":{"x":518,"y":118,"width":305,"height":9}},{"id":"b9166912-8c1b-4632-ac02-a41df27793c7","block_type":"box","text":"With respect to Investor A Shares of BlackRock Inflation Protected Bond Por tfolio of BlackRock Funds V, the","page_number":150,"box":{"x":101,"y":142,"width":768,"height":11}},{"id":"597e91f2-29b5-43e8-80b5-5c609631cc3a","block_type":"box","text":"placement fees may be up to the following amounts:","page_number":150,"box":{"x":70,"y":157,"width":371,"height":11}},{"id":"d8cf763e-2c1d-4b38-90a5-b40571a0b7ea","block_type":"box","text":"$1 million but less than $3 million . . . . . . . . . . . . . .","page_number":150,"box":{"x":167,"y":184,"width":361,"height":10}},{"id":"c0b648cb-8905-4898-8856-a0ff248769c2","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.15%","page_number":150,"box":{"x":535,"y":185,"width":288,"height":8}},{"id":"afeb809b-e7cf-4507-b43e-99479208bb85","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":150,"box":{"x":167,"y":199,"width":361,"height":10}},{"id":"3d9a0c6e-e7de-4f64-8bba-0bddc7c5ff2e","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.10%","page_number":150,"box":{"x":535,"y":200,"width":288,"height":9}},{"id":"6c28996c-e78f-46ca-a1ab-eedd0ac08ea2","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":150,"box":{"x":167,"y":214,"width":345,"height":11}},{"id":"7b81e6ef-9d81-4191-b23a-d027bcce76ca","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.05%","page_number":150,"box":{"x":518,"y":215,"width":305,"height":9}},{"id":"6d380097-1353-4040-8880-c53b66d8034b","block_type":"box","text":"With respect to Investor A Shares of BlackRock Low Duration Bond Por tfolio, BlackRock Floating Rate Income","page_number":150,"box":{"x":101,"y":239,"width":778,"height":11}},{"id":"b50a2657-a24c-450c-8071-2f5c7bff0ad3","block_type":"box","text":"Por tfolio, BlackRock Income Fund and BlackRock Strategic Income Oppor tunities Por tfolio of BlackRock Funds V, the","page_number":150,"box":{"x":69,"y":254,"width":830,"height":11}},{"id":"584c3e65-c70a-4d60-b217-1f207a7a0b44","block_type":"box","text":"placement fees may be up to the following amounts:","page_number":150,"box":{"x":70,"y":269,"width":371,"height":11}},{"id":"e9948d39-1d80-49e5-aa64-9f923be7ab66","block_type":"box","text":"$500,000 but less than $3 million . . . . . . . . . . . . . . . . . . . .","page_number":150,"box":{"x":167,"y":296,"width":410,"height":11}},{"id":"cbc17469-20a7-4c79-8eca-465eff04f792","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . 0.75%","page_number":150,"box":{"x":583,"y":297,"width":240,"height":9}},{"id":"6249b226-d673-4944-ad63-7f23f60e908c","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":150,"box":{"x":167,"y":311,"width":361,"height":11}},{"id":"88261d25-bfe8-42a5-9cb2-ed7811e9494b","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":150,"box":{"x":535,"y":312,"width":288,"height":9}},{"id":"dd2c9766-082b-4f7b-9697-7cf03c180442","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":150,"box":{"x":167,"y":326,"width":345,"height":11}},{"id":"2b0a6527-56f3-4ccc-8f7d-0a7ab9ef5c7c","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":150,"box":{"x":518,"y":327,"width":305,"height":9}},{"id":"977c32f1-1ecd-4fac-a07b-ccfbce5e3ffa","block_type":"box","text":"With respect to Investor A Shares of BlackRock Shor t Duration Muni Fund of BlackRock Municipal Bond Fund,","page_number":150,"box":{"x":101,"y":351,"width":779,"height":11}},{"id":"2d7f8690-1a41-4dd2-8e04-2a121a2de179","block_type":"box","text":"Inc. (for shares purchased prior to March 18, 2019), the placement fees may be up to the following amounts:","page_number":150,"box":{"x":70,"y":366,"width":780,"height":11}},{"id":"412a564e-708f-4c49-809b-36a18acd5a23","block_type":"box","text":"$250,000 and above . . . .","page_number":150,"box":{"x":167,"y":393,"width":182,"height":11}},{"id":"a36d055b-9385-4cad-9df3-cb660ebbb87b","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":150,"box":{"x":355,"y":394,"width":468,"height":9}},{"id":"7788a649-61aa-4ddd-8e58-e5f7bb44071e","block_type":"box","text":"With respect to Investor A Shares of BlackRock Shor t Duration Muni Fund of BlackRock Municipal Bond Fund,","page_number":150,"box":{"x":101,"y":418,"width":779,"height":11}},{"id":"bfc131fb-cad1-4a20-8fa9-378f26c4af35","block_type":"box","text":"Inc. (for shares purchased on or after March 18, 2019 and prior to July 1, 2020), the placement fees may be up to","page_number":150,"box":{"x":70,"y":433,"width":819,"height":11}},{"id":"6ff96384-6b3c-4973-9fc2-f0e9a921ad60","block_type":"box","text":"the following amounts:","page_number":150,"box":{"x":68,"y":448,"width":161,"height":11}},{"id":"db0c0c5e-562d-4d72-830e-37440e1ef638","block_type":"box","text":"$100,000 and above . . . .","page_number":150,"box":{"x":167,"y":475,"width":182,"height":11}},{"id":"2228fad3-72f8-477c-9df9-f50fff65f2ba","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":150,"box":{"x":355,"y":476,"width":468,"height":8}},{"id":"99cb57cd-f00f-4d45-ab98-5ec73bb71bae","block_type":"box","text":"With respect to Investor A Shares of BlackRock Shor t Duration Muni Fund of BlackRock Municipal Bond Fund,","page_number":150,"box":{"x":101,"y":499,"width":779,"height":11}},{"id":"2b1c0984-18b5-4396-9872-1d31fdfa39e1","block_type":"box","text":"Inc. (for shares purchased on or after July 1, 2020), the placement fees may be up to the following amounts:","page_number":150,"box":{"x":70,"y":515,"width":775,"height":11}},{"id":"8c69bda6-fb73-4248-b4c0-03b3ebea382b","block_type":"box","text":"$250,000 and above . . . .","page_number":150,"box":{"x":167,"y":542,"width":182,"height":11}},{"id":"5d915bbd-f8b9-49e7-82e1-24b5e4a7cdba","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":150,"box":{"x":355,"y":542,"width":468,"height":9}},{"id":"8b3b298e-084f-40a8-8274-92b51bb024f7","block_type":"box","text":"With respect to Investor A Shares of BlackRock Strategic Municipal Oppor tunities Fund of BlackRock Municipal","page_number":150,"box":{"x":101,"y":566,"width":788,"height":11}},{"id":"2d0486c0-54ef-423d-9d9a-505343d2dbd2","block_type":"box","text":"Series Trust, BlackRock California Municipal Oppor tunities Fund of BlackRock California Municipal Series Trust,","page_number":150,"box":{"x":69,"y":581,"width":792,"height":11}},{"id":"da80e1d2-e724-47e9-ae27-f864c97eef3b","block_type":"box","text":"BlackRock New York Municipal Oppor tunities Fund, BlackRock New Jersey Municipal Bond Fund and BlackRock","page_number":150,"box":{"x":70,"y":597,"width":787,"height":11}},{"id":"56ecf802-5ba8-49f1-8454-799ee9b043a4","block_type":"box","text":"Pennsylvania Municipal Bond Fund of BlackRock Multi-State Municipal Series Trust and BlackRock National Municipal","page_number":150,"box":{"x":69,"y":612,"width":834,"height":11}},{"id":"6ae00463-ac5e-4c9a-801e-a5b8ea7d8669","block_type":"box","text":"Fund of BlackRock Municipal Bond Fund, Inc., the placement fees may be up to the following amounts:","page_number":150,"box":{"x":70,"y":627,"width":729,"height":11}},{"id":"1110f87d-20fb-456f-ae81-d0a94cdf67c6","block_type":"box","text":"$250,000 but less than $4 million . . . . . . . . . . . . . . . . . . . .","page_number":150,"box":{"x":167,"y":654,"width":410,"height":11}},{"id":"eecc28ce-7177-4f61-9c6b-848ed46895c6","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . 1.00%","page_number":150,"box":{"x":583,"y":655,"width":240,"height":8}},{"id":"20bd2722-f6e4-4d89-aaff-88fbebb25533","block_type":"box","text":"$4 million but less than $10 million . . . . . . . . . . . . .","page_number":150,"box":{"x":167,"y":669,"width":361,"height":10}},{"id":"daeffa74-ee5f-4594-b061-627f957c3f62","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":150,"box":{"x":535,"y":670,"width":288,"height":9}},{"id":"3a4244b8-ba2b-421b-b4e0-a5688a148d2c","block_type":"box","text":"$10 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":150,"box":{"x":167,"y":684,"width":345,"height":10}},{"id":"86267bab-e8b5-487a-b41e-a416a86502bd","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":150,"box":{"x":518,"y":685,"width":305,"height":9}},{"id":"c713b0d9-9c18-4c66-b16d-02e02c9d48cd","block_type":"box","text":"With respect to Investor A Shares of BlackRock Dynamic High Income Por tfolio (for shares purchased on or after","page_number":150,"box":{"x":101,"y":709,"width":801,"height":11}},{"id":"42a685c2-07eb-49b0-ac0f-eecad3dc2cee","block_type":"box","text":"July 1, 2020) and BlackRock Multi-Asset Income Por tfolio (for shares purchased on or after July 1, 2020) of","page_number":150,"box":{"x":69,"y":724,"width":769,"height":11}},{"id":"c691e04e-932d-4947-af68-16c8b20c26b7","block_type":"box","text":"BlackRock Funds II, BlackRock Total Return Fund of BlackRock Bond Fund, Inc. and BlackRock Balanced Fund, Inc.,","page_number":150,"box":{"x":70,"y":739,"width":818,"height":10}},{"id":"c9341275-b598-4680-a055-a0c113853ee7","block_type":"box","text":"the placement fees may be up to the following amounts:","page_number":150,"box":{"x":68,"y":754,"width":401,"height":11}},{"id":"19f49b46-0f48-4d41-9e39-c4aae3fb35d1","block_type":"box","text":"$250,000 but less than $3 million . . . . . . . . . . . . . . . . . . . .","page_number":150,"box":{"x":167,"y":781,"width":410,"height":11}},{"id":"ca580079-9e43-46ac-b5ed-622aee249327","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . 0.75%","page_number":150,"box":{"x":583,"y":782,"width":240,"height":9}},{"id":"cd6e3314-d803-4280-adaa-8a3186b146c4","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":150,"box":{"x":167,"y":796,"width":361,"height":11}},{"id":"90440c5b-1b79-4014-8030-99e040ddd963","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":150,"box":{"x":535,"y":797,"width":288,"height":9}},{"id":"d46486e2-4e35-402d-9bee-2bd25d5af006","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":150,"box":{"x":167,"y":811,"width":345,"height":11}},{"id":"01743f72-34ed-4daa-8f45-1092348fc9a1","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":150,"box":{"x":518,"y":812,"width":305,"height":9}},{"id":"710616c3-8cbd-4d06-ae59-b3730ed907dc","block_type":"box","text":"With respect to Investor P Shares of BlackRock LifePath","page_number":150,"box":{"x":101,"y":836,"width":398,"height":11}},{"id":"38f59f63-2593-4cf6-bfb4-22828f2b3c2c","block_type":"box","text":"®","page_number":150,"box":{"x":500,"y":836,"width":6,"height":5}},{"id":"0b13e89a-d30f-45d2-87f1-740682a6e7ea","block_type":"box","text":"Index 2030 Fund, BlackRock LifePath","page_number":150,"box":{"x":513,"y":836,"width":264,"height":10}},{"id":"6a16ea52-f687-4647-a526-c0374dafe598","block_type":"box","text":"®","page_number":150,"box":{"x":778,"y":836,"width":6,"height":5}},{"id":"6b6d71f6-85b3-4d97-9d95-7184a4471cd1","block_type":"box","text":"Index 2035","page_number":150,"box":{"x":791,"y":836,"width":79,"height":9}},{"id":"ddbf3620-76e5-4592-880b-64557deb9290","block_type":"box","text":"Fund, BlackRock LifePath","page_number":150,"box":{"x":70,"y":851,"width":177,"height":10}},{"id":"d43cc740-0984-41f6-9776-0fd5fbcb6b93","block_type":"box","text":"®","page_number":150,"box":{"x":249,"y":851,"width":6,"height":5}},{"id":"bf1bf634-d9bb-49ad-89f7-d4a6ebf63c8e","block_type":"box","text":"Index 2040 Fund, BlackRock LifePath","page_number":150,"box":{"x":261,"y":851,"width":265,"height":10}},{"id":"f569917a-bc34-45f0-8d71-4a45c5d6fbd6","block_type":"box","text":"®","page_number":150,"box":{"x":527,"y":851,"width":6,"height":5}},{"id":"557f93ff-efad-4dd9-b325-e1bf96ad04f6","block_type":"box","text":"Index 2045 Fund, BlackRock LifePath","page_number":150,"box":{"x":539,"y":851,"width":265,"height":10}},{"id":"81d4580b-d126-46e2-a9fc-fbcc030f0714","block_type":"box","text":"®","page_number":150,"box":{"x":805,"y":851,"width":6,"height":5}},{"id":"c062063a-88c5-415f-b7c2-4db31cef3eba","block_type":"box","text":"Index 2050","page_number":150,"box":{"x":817,"y":851,"width":80,"height":9}},{"id":"72908d8a-d6e4-4661-a15e-f7a837bb6935","block_type":"box","text":"Fund, BlackRock LifePath","page_number":150,"box":{"x":70,"y":866,"width":177,"height":11}},{"id":"0ae3afb0-01b6-4b84-8b42-d4f397a94469","block_type":"box","text":"®","page_number":150,"box":{"x":248,"y":866,"width":6,"height":5}},{"id":"e814cae5-6505-49b0-8888-714311e31fda","block_type":"box","text":"Index 2055 Fund, BlackRock LifePath","page_number":150,"box":{"x":261,"y":866,"width":263,"height":11}},{"id":"cc20ead5-eaec-4f40-8b45-96c272c14eec","block_type":"box","text":"®","page_number":150,"box":{"x":526,"y":866,"width":6,"height":5}},{"id":"8394789e-73fc-41eb-a4c9-b581a2584407","block_type":"box","text":"Index 2060 Fund, BlackRock LifePath","page_number":150,"box":{"x":538,"y":866,"width":264,"height":11}},{"id":"3a910c09-879f-439c-a400-26f9fecc5021","block_type":"box","text":"®","page_number":150,"box":{"x":803,"y":866,"width":6,"height":5}},{"id":"8a926ee2-4ad7-415a-9aa7-feb6320ce3be","block_type":"box","text":"Index 2065","page_number":150,"box":{"x":815,"y":866,"width":80,"height":9}},{"id":"7c2b9a84-4c4b-4c7b-8d80-eb5208bcdd6f","block_type":"box","text":"II-103","page_number":150,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"a8b0a1af-7575-4e91-a116-8a95b7bd5c86","block_type":"box","text":"NM1026U-6033063-150/246","page_number":150,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"9938e728-846c-477f-a1a9-338b96970068","block_type":"box","text":"Fund, BlackRock LifePath","page_number":151,"box":{"x":70,"y":45,"width":177,"height":10}},{"id":"614ff129-7fc6-4efb-9a5f-f7087a36ff65","block_type":"box","text":"®","page_number":151,"box":{"x":248,"y":45,"width":6,"height":4}},{"id":"d58d3d29-2520-4271-9cf0-7cc14bab0579","block_type":"box","text":"Index 2070 Fund and BlackRock LifePath","page_number":151,"box":{"x":261,"y":45,"width":290,"height":9}},{"id":"3cfcf37f-2421-4e6d-9e1f-373f042fb3c4","block_type":"box","text":"®","page_number":151,"box":{"x":552,"y":45,"width":6,"height":4}},{"id":"807c7d53-65bb-42cc-aed6-1d3395108cc7","block_type":"box","text":"Index Retirement Fund of BlackRock Funds III,","page_number":151,"box":{"x":564,"y":45,"width":324,"height":10}},{"id":"00d645c0-7fd8-4d93-a07c-161e72f9705c","block_type":"box","text":"the placement fees may be up to the following amounts:","page_number":151,"box":{"x":68,"y":60,"width":401,"height":11}},{"id":"517796b4-9f39-4bdb-b5a2-d054012e4908","block_type":"box","text":"$1,000,000 and above . . . . .","page_number":151,"box":{"x":167,"y":87,"width":206,"height":11}},{"id":"0c3f3d96-f1bc-47cb-9fc7-74800c857c62","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.10%","page_number":151,"box":{"x":380,"y":88,"width":443,"height":8}},{"id":"35f6c905-00a1-4685-8009-cbf4ab42460c","block_type":"box","text":"With respect to Investor P Shares of iShares Municipal Bond Index Fund of BlackRock Funds","page_number":151,"box":{"x":101,"y":111,"width":657,"height":11}},{"id":"399ad51f-b5ab-46dd-b2b5-373c3887d30e","block_type":"box","text":"SM","page_number":151,"box":{"x":760,"y":112,"width":10,"height":4}},{"id":"72f6f16a-666e-4614-9c61-1d70c495883b","block_type":"box","text":", the placement","page_number":151,"box":{"x":773,"y":112,"width":110,"height":10}},{"id":"189f2075-c3f7-4f4c-b31b-989427946aee","block_type":"box","text":"fees may be up to the following amounts:","page_number":151,"box":{"x":68,"y":126,"width":294,"height":12}},{"id":"db0c3d02-8a58-48d8-8912-6541a3bb1f9c","block_type":"box","text":"$1,000,000 and above . . . . .","page_number":151,"box":{"x":167,"y":154,"width":206,"height":11}},{"id":"44f11389-cae9-4b82-bbc1-b555d398e68e","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.15%","page_number":151,"box":{"x":380,"y":154,"width":443,"height":9}},{"id":"2eba36a0-0aeb-49c7-b665-3eeeadd04573","block_type":"box","text":"There are no placement fees for Investor P Shares of iShares MSCI EAFE International Index Fund and iShares","page_number":151,"box":{"x":101,"y":178,"width":787,"height":11}},{"id":"c4e4c5a4-4197-48f0-9a3f-2a485cc155fe","block_type":"box","text":"Russell 2000 Small-Cap Index Fund of BlackRock Index Funds, Inc. and iShares S&P 500 Index Fund and iShares","page_number":151,"box":{"x":70,"y":193,"width":808,"height":11}},{"id":"1e38a3c0-9785-43b6-b358-de1b55799e9a","block_type":"box","text":"U.S. Aggregate Bond Index Fund of BlackRock Funds III.","page_number":151,"box":{"x":70,"y":208,"width":393,"height":12}},{"id":"cb091ba8-d6df-46a6-8732-80b5e8dea76c","block_type":"box","text":"For the tables above, the placement fees indicated will apply up to the indicated breakpoint (so that, for","page_number":151,"box":{"x":102,"y":231,"width":740,"height":11}},{"id":"b42b294e-19e1-4a93-a1c5-ed13ed3b412d","block_type":"box","text":"example, a sale of $4 million wor th of Investor A Shares of BlackRock Impact Mor tgage Fund of BlackRock Funds V","page_number":151,"box":{"x":69,"y":246,"width":823,"height":11}},{"id":"a5a1d434-fee3-49dd-9c29-aea9794d23d9","block_type":"box","text":"will result in a placement fee of up to 0.50% on the first $3 million and a placement fee of 0.25% on the final","page_number":151,"box":{"x":68,"y":261,"width":780,"height":11}},{"id":"de143124-c0b0-4b5c-ba0f-164fd693541d","block_type":"box","text":"$1 million).","page_number":151,"box":{"x":69,"y":276,"width":79,"height":11}},{"id":"42607281-3a30-4e40-b1e7-8c6cdb7ae1e0","block_type":"box","text":"Other.","page_number":151,"box":{"x":102,"y":299,"width":41,"height":9}},{"id":"7de7c675-bebf-4a5b-baeb-c07e161e7cfc","block_type":"box","text":"The following persons may also buy Investor A or Investor P Shares without paying a sales charge:","page_number":151,"box":{"x":149,"y":299,"width":698,"height":11}},{"id":"987be81d-c13f-4baa-8746-7b9b81bf587a","block_type":"box","text":"(a) cer tain employer-sponsored retirement plans (for purposes of this waiver, employer-sponsored retirement plans do","page_number":151,"box":{"x":69,"y":314,"width":839,"height":11}},{"id":"f0d44d00-1262-4d17-bf94-079171fdead8","block_type":"box","text":"not include SEP IRAs, SIMPLE IRAs or SARSEPs); (b) rollovers of current investments through cer tain employer","page_number":151,"box":{"x":69,"y":329,"width":790,"height":12}},{"id":"9cca9798-e51e-48cd-89d6-1142a09fd003","block_type":"box","text":"sponsored retirement plans provided the shares are transferred to Investor A or Investor P, as applicable, shares of","page_number":151,"box":{"x":69,"y":344,"width":825,"height":11}},{"id":"99609dd5-643e-4656-be32-a21f8fe8a0f7","block_type":"box","text":"the same or another BlackRock Fund as either a direct rollover, or subsequent to distribution, the rolled-over","page_number":151,"box":{"x":68,"y":360,"width":773,"height":11}},{"id":"22f5daec-a4d1-44c7-8b61-c855deab935b","block_type":"box","text":"proceeds are contributed to a BlackRock IRA through an account directly with the Fund; or purchases by IRA programs","page_number":151,"box":{"x":70,"y":375,"width":838,"height":11}},{"id":"f6692746-3524-4407-9f04-86f7c7de316b","block_type":"box","text":"that are sponsored by financial intermediary firms provided the financial intermediary firm has entered into a Class A","page_number":151,"box":{"x":68,"y":390,"width":837,"height":11}},{"id":"d654861e-2e19-4232-9830-af2b84f4ff92","block_type":"box","text":"or Investor P NAV agreement, as applicable, with respect to such program with the Distributor; (c) insurance company","page_number":151,"box":{"x":69,"y":405,"width":836,"height":11}},{"id":"cf5888ad-cbd3-4f17-b5ca-4458789e1e05","block_type":"box","text":"separate accounts; (d) registered investment advisers, trust companies and bank trust depar tments exercising","page_number":151,"box":{"x":69,"y":420,"width":793,"height":11}},{"id":"51ca3363-0968-41f5-8245-3692310e1b84","block_type":"box","text":"discretionary investment authority with respect to amounts to be invested in a Fund; (e) persons par ticipating in a","page_number":151,"box":{"x":69,"y":435,"width":811,"height":11}},{"id":"45f7aea3-d645-465d-ae8c-4060bd87e68d","block_type":"box","text":"fee-based program (such as a wrap account) under which they pay advisory fees to a broker-dealer or other financial","page_number":151,"box":{"x":68,"y":450,"width":827,"height":12}},{"id":"b6b6be25-f051-4d16-b8d1-16935e54329f","block_type":"box","text":"institution; (f) financial intermediaries who have entered into an agreement with the Distributor and have been","page_number":151,"box":{"x":70,"y":465,"width":782,"height":12}},{"id":"00283e84-7270-4c54-ad7c-fe998a598a2e","block_type":"box","text":"approved by the Distributor to offer Fund shares to self-directed investment brokerage accounts that may or may not","page_number":151,"box":{"x":69,"y":481,"width":830,"height":11}},{"id":"8f00aa76-e54b-4c95-8ec3-b1fa40f6ee9e","block_type":"box","text":"charge a transaction fee; (g) state sponsored 529 college savings plans and rollovers of such 529 plans into Roth","page_number":151,"box":{"x":69,"y":496,"width":815,"height":11}},{"id":"9957c953-788b-4c61-b5f8-15864b05f16a","block_type":"box","text":"IRAs as permitted under the Internal Revenue Code; (h) with respect to Investor A Shares only, accounts opened","page_number":151,"box":{"x":70,"y":511,"width":799,"height":11}},{"id":"c255f496-6688-4365-8a56-06bb2b72e04f","block_type":"box","text":"directly with a Fund that do not have a financial intermediary associated with the account; and (i) persons","page_number":151,"box":{"x":69,"y":526,"width":752,"height":11}},{"id":"52d1c6af-725e-46c0-9d2d-2dc1f232f2bc","block_type":"box","text":"involuntarily liquidated from a Fund, who within 60 days of liquidation buy new shares of another BlackRock Fund (but","page_number":151,"box":{"x":70,"y":541,"width":836,"height":11}},{"id":"a67d5c8b-418d-431b-914d-b48af7dac7df","block_type":"box","text":"only up to the amount that was liquidated). The following persons associated with the Funds, the Fund’s Manager,","page_number":151,"box":{"x":69,"y":556,"width":812,"height":11}},{"id":"8af4ad55-468d-4809-9d9b-da2d8b38397c","block_type":"box","text":"Sub-Advisers, Transfer Agent, Distributor, fund accounting agents, Barclays PLC and their affiliates may buy Investor A","page_number":151,"box":{"x":69,"y":571,"width":839,"height":12}},{"id":"f2c4860b-4839-4400-8deb-2544c2df16ce","block_type":"box","text":"or Investor P Shares of each of the Funds without paying a sales charge to the extent permitted by these firms","page_number":151,"box":{"x":69,"y":586,"width":788,"height":12}},{"id":"2406e857-68f9-4d79-9b70-9f2f8606a775","block_type":"box","text":"including: (a) officers, directors and par tners; (b) employees and retirees; (c) employees or registered representatives","page_number":151,"box":{"x":70,"y":601,"width":838,"height":12}},{"id":"35735306-fd04-498b-ba23-824361384b21","block_type":"box","text":"of firms who have entered into selling agreements to distribute shares of BlackRock-advised funds; (d) immediate","page_number":151,"box":{"x":69,"y":617,"width":810,"height":11}},{"id":"6bacbf45-0459-445e-ae04-d0a9a7dc0c9e","block_type":"box","text":"family members of such persons (“immediate family members” shall be defined as the investor, the investor’s","page_number":151,"box":{"x":68,"y":632,"width":787,"height":11}},{"id":"deac863c-fc21-4658-a6b4-6bcecb9df6ec","block_type":"box","text":"spouse or domestic par tner, children, parents and siblings); and (e) any trust, pension, profit-sharing or other benefit","page_number":151,"box":{"x":69,"y":647,"width":834,"height":11}},{"id":"acba83a5-af36-4ae9-a3d8-0b5e0e9ee529","block_type":"box","text":"plan for any of the persons set for th in (a) through (d). Investors who qualify for any of these exemptions from the","page_number":151,"box":{"x":70,"y":662,"width":808,"height":11}},{"id":"8a30ab79-d89f-467d-8c03-76c41ee3fc63","block_type":"box","text":"sales charge should purchase Investor A or Investor P Shares. In addition, a sales charge waiver may be available for","page_number":151,"box":{"x":69,"y":677,"width":837,"height":11}},{"id":"9b349edd-dce4-4667-851f-61bd49b257cf","block_type":"box","text":"investors exchanging Investor A Shares of one BlackRock Fund for Investor P Shares of another BlackRock Fund, or","page_number":151,"box":{"x":70,"y":692,"width":820,"height":11}},{"id":"96fcf1dc-93fd-4f23-b104-4e26b6e1910e","block_type":"box","text":"exchanging Investor P Shares of one BlackRock Fund for Investor A Shares of another BlackRock Fund, through an","page_number":151,"box":{"x":69,"y":707,"width":813,"height":12}},{"id":"ddb7447d-a40e-45f4-83f0-e79add4c924a","block_type":"box","text":"intermediary-processed exchange, provided that the investor had previously paid a sales charge with respect to such","page_number":151,"box":{"x":70,"y":723,"width":831,"height":11}},{"id":"8e17daf5-de6c-4fd0-95b1-f86f9306178f","block_type":"box","text":"shares. The availability of Investor A or Investor P Shares sales charge waivers may depend upon the policies,","page_number":151,"box":{"x":69,"y":738,"width":783,"height":11}},{"id":"2ef19645-c090-47e6-8161-e40ea3a93d59","block_type":"box","text":"procedures and trading platforms of your financial intermediary; consult your financial adviser.","page_number":151,"box":{"x":70,"y":753,"width":668,"height":11}},{"id":"4b7cbe89-9978-4f13-bfd5-fb3f1c28a7cc","block_type":"box","text":"If you invest $1,000,000 ($250,000 for BlackRock Dynamic High Income Por tfolio, BlackRock Multi-Asset","page_number":151,"box":{"x":102,"y":775,"width":754,"height":12}},{"id":"6cb16183-68b6-4f69-8a12-1655b819dc93","block_type":"box","text":"Income Por tfolio and BlackRock Managed Income Fund of BlackRock Funds II, BlackRock Credit Relative Value Fund","page_number":151,"box":{"x":70,"y":790,"width":823,"height":12}},{"id":"489cc321-afc8-4ee0-9ca7-c3f5c8bc5b55","block_type":"box","text":"of BlackRock Funds IV, BlackRock Total Return Fund of BlackRock Bond Fund, Inc., BlackRock Global Allocation Fund,","page_number":151,"box":{"x":69,"y":806,"width":833,"height":10}},{"id":"3d1ba4bf-4907-49e8-b592-f32cf9e87924","block_type":"box","text":"Inc., BlackRock National Municipal Fund of BlackRock Municipal Bond Fund, Inc., BlackRock Shor t Duration Muni","page_number":151,"box":{"x":70,"y":821,"width":802,"height":11}},{"id":"de6f879d-99a0-4953-9dc1-4a19022a162b","block_type":"box","text":"Fund of BlackRock Municipal Bond Fund, Inc., BlackRock Strategic Municipal Oppor tunities Fund of BlackRock","page_number":151,"box":{"x":70,"y":836,"width":781,"height":11}},{"id":"c4622d77-1e76-4dfb-8d7e-c679e9558fa8","block_type":"box","text":"Municipal Series Trust, BlackRock California Municipal Oppor tunities Fund of BlackRock California Municipal Series","page_number":151,"box":{"x":70,"y":851,"width":819,"height":11}},{"id":"56715751-5797-4800-8057-29267a55e8a2","block_type":"box","text":"Trust, BlackRock New York Municipal Oppor tunities Fund, BlackRock New Jersey Municipal Bond Fund and BlackRock","page_number":151,"box":{"x":68,"y":866,"width":835,"height":11}},{"id":"c8cce8c2-fde6-4fae-846a-80df2fa246b9","block_type":"box","text":"Pennsylvania Municipal Bond Fund of BlackRock Multi-State Municipal Series Trust, BlackRock Event Driven Equity","page_number":151,"box":{"x":69,"y":881,"width":813,"height":11}},{"id":"2035c5a4-f04a-45d0-8bfe-d23c4c090da1","block_type":"box","text":"Fund and BlackRock Balanced Fund, Inc., and $500,000 for BlackRock Low Duration Bond Por tfolio, BlackRock","page_number":151,"box":{"x":70,"y":896,"width":792,"height":11}},{"id":"633cb9d9-6b10-4b28-931d-cab2e88b5fab","block_type":"box","text":"Floating Rate Income Por tfolio, BlackRock Income Fund and BlackRock Strategic Income Oppor tunities Por tfolio of","page_number":151,"box":{"x":70,"y":911,"width":813,"height":12}},{"id":"5f7d9d57-bf32-4780-b6e5-6b06734f5964","block_type":"box","text":"II-104","page_number":151,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"c429c5fe-1251-42bb-ab09-ddaa099ad4d4","block_type":"box","text":"NM1026U-6033063-151/246","page_number":151,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"b2eb8e2e-fa68-42ea-9178-43be110f3109","block_type":"box","text":"BlackRock Funds V) or more in Investor A or Investor P Shares, as applicable, you may not pay an initial sales charge.","page_number":152,"box":{"x":70,"y":45,"width":837,"height":11}},{"id":"f5472b1a-a259-4b04-82ef-da0bcf7fa2c3","block_type":"box","text":"However, if you redeem your Investor A or Investor P Shares, as applicable, within 18 months after purchase (a","page_number":152,"box":{"x":70,"y":60,"width":790,"height":11}},{"id":"94dc04d0-6377-4fdc-9b89-e56336d04fa3","block_type":"box","text":"shor ter holding period may apply depending on the Fund), you may be charged a deferred sales charge.","page_number":152,"box":{"x":69,"y":75,"width":736,"height":11}},{"id":"023079e0-976e-4626-b9f5-9da8d8ae4c00","block_type":"box","text":"A deferred sales charge of up to 1.00% may apply to cer tain redemptions of Investor A Shares of the Index","page_number":152,"box":{"x":101,"y":98,"width":763,"height":11}},{"id":"766a0724-3b33-4e81-84e4-c6a1e5ec7f57","block_type":"box","text":"Funds and BlackRock Shor t Obligations Fund purchased in an exchange transaction for Investor A Shares of a","page_number":152,"box":{"x":70,"y":113,"width":782,"height":11}},{"id":"30207aa8-abfb-45a0-8771-608363a9e933","block_type":"box","text":"por tfolio advised by BlackRock or its affiliates where no initial sales charge was paid at the time of purchase of such","page_number":152,"box":{"x":70,"y":128,"width":832,"height":11}},{"id":"b0e22114-6199-4b04-9b9f-bd5dffc05a8b","block_type":"box","text":"fund (an “Investor A Load-Waived BlackRock Por tfolio”) as par t of an investment of $1,000,000 (lesser amounts may","page_number":152,"box":{"x":68,"y":142,"width":839,"height":12}},{"id":"e2ce68bb-31ac-4c4b-8425-776854fe220f","block_type":"box","text":"apply depending on the Investor A Load-Waived BlackRock Por tfolio) or more. The Investor A Shares deferred sales","page_number":152,"box":{"x":69,"y":158,"width":817,"height":11}},{"id":"5da772aa-9c17-4327-bc16-dc01bbe6dff9","block_type":"box","text":"charge is only charged upon redemptions of Investor A Shares within 18 months after you originally acquired such","page_number":152,"box":{"x":69,"y":173,"width":811,"height":11}},{"id":"c50cc64b-112f-488e-9691-04e80e354616","block_type":"box","text":"Investor A Shares of the Investor A Load-Waived BlackRock Por tfolio (a shor ter holding period may apply depending","page_number":152,"box":{"x":70,"y":188,"width":818,"height":12}},{"id":"d8eb8b5a-6707-4712-83ee-eeb520f0a59b","block_type":"box","text":"on the Investor A Load-Waived BlackRock Por tfolio), unless you qualify for a waiver. There is no deferred sales charge","page_number":152,"box":{"x":69,"y":203,"width":836,"height":12}},{"id":"296e3f7e-f360-405f-8f7b-4c5efb974593","block_type":"box","text":"charged on redemptions if you have owned your Investor A Shares for more than 18 months (or for a shor ter holding","page_number":152,"box":{"x":69,"y":218,"width":830,"height":12}},{"id":"e1aea2b4-2714-4965-ab73-5be3912e821d","block_type":"box","text":"period, as applicable) (as measured from your original purchase of Investor A Shares that you exchanged into","page_number":152,"box":{"x":70,"y":234,"width":778,"height":11}},{"id":"1ac873a4-8ff7-4ee3-bfdd-bbe5d10f91c0","block_type":"box","text":"Investor A Shares of the Index Fund or BlackRock Shor t Obligations Fund).","page_number":152,"box":{"x":70,"y":249,"width":526,"height":11}},{"id":"2e00cc26-d67a-4b64-a409-a0ef5176cc23","block_type":"box","text":"The deferred sales charge on Investor A or Investor P Shares, as applicable, is not charged in connection with:","page_number":152,"box":{"x":101,"y":271,"width":788,"height":12}},{"id":"05b69970-5d56-4464-b750-4a488b813da0","block_type":"box","text":"(a) redemptions of Investor A or Investor P Shares purchased through cer tain employer-sponsored retirement plans","page_number":152,"box":{"x":69,"y":286,"width":819,"height":12}},{"id":"5b1b7782-68dd-4ea5-a089-e176134d8526","block_type":"box","text":"and rollovers of current investments in a Fund through such plans; (b) exchanges described in “Exchange Privilege”","page_number":152,"box":{"x":69,"y":302,"width":820,"height":11}},{"id":"2aa0843f-044c-48db-80c4-7529df86c269","block_type":"box","text":"below; (c) redemptions made in connection with minimum required distributions from IRA and 403(b)(7) accounts due","page_number":152,"box":{"x":69,"y":317,"width":837,"height":11}},{"id":"d4add745-c4d7-4870-893f-d7363679c2a9","block_type":"box","text":"to the shareholder reaching the applicable age triggering such distributions; (d) redemptions made with respect to","page_number":152,"box":{"x":68,"y":332,"width":812,"height":11}},{"id":"e38ad7e9-1d63-49ee-a48f-f54b97480110","block_type":"box","text":"cer tain retirement plans sponsored by a Fund, BlackRock or its affiliates; (e) redemptions (i) within one year of a","page_number":152,"box":{"x":69,"y":347,"width":803,"height":11}},{"id":"b853e76e-a393-4983-a7a6-fac0eb545325","block_type":"box","text":"shareholder’s death or, if later, the receipt of a cer tified probate settlement (including in connection with the","page_number":152,"box":{"x":69,"y":362,"width":772,"height":11}},{"id":"1e75258d-711f-4c6c-b6d8-9c39f4d6aef3","block_type":"box","text":"distribution of account assets to a beneficiary of the decedent) or (ii) in connection with a shareholder’s disability (as","page_number":152,"box":{"x":69,"y":377,"width":835,"height":11}},{"id":"97dd07fd-d8ff-4805-9912-6b7df6b8ebaf","block_type":"box","text":"defined in the Code) subsequent to the purchase of Investor A or Investor P Shares; (f) involuntary redemptions of","page_number":152,"box":{"x":69,"y":392,"width":814,"height":12}},{"id":"dd616213-9da8-4488-8e9e-2c2b3b49bbea","block_type":"box","text":"Investor A or Investor P Shares in accounts with low balances; (g) cer tain redemptions made pursuant to the","page_number":152,"box":{"x":70,"y":408,"width":772,"height":11}},{"id":"12add40f-e421-4c8a-b670-12f66adbf214","block_type":"box","text":"Systematic Withdrawal Plan (described below); (h) redemptions related to the payment of BNY Mellon Investment","page_number":152,"box":{"x":69,"y":423,"width":805,"height":11}},{"id":"0154e819-0bf0-4fc8-a0ae-e1c6cefeac5c","block_type":"box","text":"Servicing Trust Company custodial IRA fees; and (i) redemptions when a shareholder can demonstrate hardship, in","page_number":152,"box":{"x":69,"y":438,"width":817,"height":11}},{"id":"5f6226f4-62a1-4672-b5a7-40fc4312242d","block_type":"box","text":"the absolute discretion of a Fund.","page_number":152,"box":{"x":68,"y":453,"width":239,"height":9}},{"id":"44de2c6a-4bd5-417d-b93f-1404bdf1de86","block_type":"box","text":"With respect to cer tain employer-sponsored retirement plans, if a dealer waives its right to receive a placement","page_number":152,"box":{"x":101,"y":475,"width":794,"height":12}},{"id":"a1153316-cb62-4eb4-8b33-024a26f21cd8","block_type":"box","text":"fee, the Fund may, at its own discretion, waive the CDSC related to purchases of $1,000,000 ($250,000 for","page_number":152,"box":{"x":68,"y":490,"width":776,"height":12}},{"id":"5c4aec70-d432-436a-bd18-0da53f71c030","block_type":"box","text":"BlackRock Dynamic High Income Por tfolio, BlackRock Multi-Asset Income Por tfolio and BlackRock Managed Income","page_number":152,"box":{"x":70,"y":506,"width":821,"height":11}},{"id":"57f17e3b-5e75-4d64-92b9-7e11141897f1","block_type":"box","text":"Fund of BlackRock Funds II, BlackRock Credit Relative Value Fund of BlackRock Funds IV, BlackRock Total Return","page_number":152,"box":{"x":70,"y":521,"width":800,"height":10}},{"id":"300ef17a-b79d-4db8-ab3f-44a985eb9f6f","block_type":"box","text":"Fund of BlackRock Bond Fund, Inc., BlackRock Global Allocation Fund, Inc., BlackRock National Municipal Fund of","page_number":152,"box":{"x":70,"y":536,"width":806,"height":11}},{"id":"43cf04c0-d1df-4979-b042-10991f1eb85f","block_type":"box","text":"BlackRock Municipal Bond Fund, Inc., BlackRock Shor t Duration Muni Fund of BlackRock Municipal Bond Fund, Inc.,","page_number":152,"box":{"x":70,"y":551,"width":823,"height":11}},{"id":"cafa86d2-749c-44da-96a7-9892b9713c05","block_type":"box","text":"BlackRock Strategic Municipal Oppor tunities Fund of BlackRock Municipal Series Trust, BlackRock California","page_number":152,"box":{"x":70,"y":566,"width":770,"height":11}},{"id":"32302b5e-b693-4c1d-8a34-f9eac00effc8","block_type":"box","text":"Municipal Oppor tunities Fund of BlackRock California Municipal Series Trust, BlackRock New York Municipal","page_number":152,"box":{"x":70,"y":581,"width":766,"height":11}},{"id":"4066d4ff-9f2a-4402-82f3-6b1692299af6","block_type":"box","text":"Oppor tunities Fund, BlackRock New Jersey Municipal Bond Fund and BlackRock Pennsylvania Municipal Bond Fund of","page_number":152,"box":{"x":69,"y":596,"width":837,"height":12}},{"id":"eb46e74c-3394-4d9b-8917-e2b3245f11a7","block_type":"box","text":"BlackRock Multi-State Municipal Series Trust, BlackRock Event Driven Equity Fund and BlackRock Balanced Fund,","page_number":152,"box":{"x":70,"y":612,"width":805,"height":11}},{"id":"100fed2a-8ef4-4b03-bd23-948574fb48a7","block_type":"box","text":"Inc., and $500,000 for BlackRock Low Duration Bond Por tfolio, BlackRock Floating Rate Income Por tfolio, BlackRock","page_number":152,"box":{"x":70,"y":626,"width":832,"height":12}},{"id":"a8c94128-4268-4d8a-97bd-da68cedd6cfe","block_type":"box","text":"Income Fund and BlackRock Strategic Income Oppor tunities Por tfolio of BlackRock Funds V) or more of Investor A or","page_number":152,"box":{"x":70,"y":642,"width":828,"height":11}},{"id":"35ab37bb-1563-487b-8fca-485cf94a7d54","block_type":"box","text":"Investor P Shares. This may depend upon the policies, procedures and trading platforms of your financial","page_number":152,"box":{"x":70,"y":657,"width":746,"height":11}},{"id":"b6136192-d2f0-4fe6-8ce4-140921f1d6c8","block_type":"box","text":"intermediary; consult your financial adviser.","page_number":152,"box":{"x":70,"y":672,"width":307,"height":11}},{"id":"47c6fce3-25f1-4107-b0ab-2724c3ab584d","block_type":"box","text":"Investor A and Investor P Shares are also available at NAV to investors that, for regulatory reasons, are required","page_number":152,"box":{"x":102,"y":695,"width":799,"height":11}},{"id":"5160de97-c043-4c6c-a5c9-147c41807930","block_type":"box","text":"to transfer investment positions from a foreign registered investment company advised by BlackRock or its affiliates","page_number":152,"box":{"x":68,"y":710,"width":829,"height":11}},{"id":"3785289e-8496-4d52-97c4-0251df312004","block_type":"box","text":"to a U.S. registered BlackRock-advised fund.","page_number":152,"box":{"x":68,"y":725,"width":317,"height":11}},{"id":"1ca9d8d8-019b-4bfc-af83-3f303e4c99df","block_type":"box","text":"Acquisition of Cer tain Investment Companies.","page_number":152,"box":{"x":101,"y":748,"width":326,"height":11}},{"id":"11b98126-2552-42ea-ad68-e1af3b7136f7","block_type":"box","text":"Investor A and Investor P Shares may be offered at NAV in","page_number":152,"box":{"x":434,"y":748,"width":413,"height":11}},{"id":"bf902ce8-62e9-4f74-bfcd-0350ee98fd91","block_type":"box","text":"connection with the acquisition of the assets of, or merger or consolidation with, a personal holding company or a","page_number":152,"box":{"x":69,"y":763,"width":811,"height":11}},{"id":"ea3f36f6-918e-45c6-83cf-78394c65c35d","block_type":"box","text":"public or private investment company.","page_number":152,"box":{"x":70,"y":778,"width":266,"height":11}},{"id":"ee1ba1db-6bb1-4818-bd84-00a12c047d63","block_type":"box","text":"Purchases Through Cer tain Financial Intermediaries.","page_number":152,"box":{"x":102,"y":801,"width":372,"height":11}},{"id":"7a63c926-945f-4f8e-96e4-326db122cef6","block_type":"box","text":"Reduced sales charges may be applicable for purchases of","page_number":152,"box":{"x":481,"y":801,"width":421,"height":11}},{"id":"e134d473-5ddc-4043-a1e3-776e9cc049b0","block_type":"box","text":"Investor A, Investor A1 or Investor P Shares of a Fund through cer tain financial advisers, selected securities dealers","page_number":152,"box":{"x":70,"y":816,"width":825,"height":11}},{"id":"e7751613-af64-42a6-9f55-092c67bf57d2","block_type":"box","text":"and other financial intermediaries that meet and adhere to standards established by the Manager from time to time.","page_number":152,"box":{"x":69,"y":831,"width":830,"height":11}},{"id":"7c056e9f-e2d6-424c-9ecc-3eeb96bf48c2","block_type":"box","text":"II-105","page_number":152,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"6e165089-09e7-4834-8e9e-303f9dabcb92","block_type":"box","text":"NM1026U-6033063-152/246","page_number":152,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"9debc869-e8f8-463b-b84f-3bc96f92d256","block_type":"box","text":"Deferred Sales Charge Alternative — Investor C Shares","page_number":153,"box":{"x":69,"y":45,"width":405,"height":11}},{"id":"f56299ad-53f8-4783-bb7e-7c721733ff7b","block_type":"box","text":"Investors choosing the deferred sales charge alternative should consider Investor C Shares if they are uncer tain","page_number":153,"box":{"x":102,"y":67,"width":799,"height":12}},{"id":"38a838e5-293d-4776-b86f-680d6d5913b8","block_type":"box","text":"as to the length of time they intend to hold their assets in a Fund. If you select Investor C Shares, you do not pay an","page_number":153,"box":{"x":69,"y":82,"width":828,"height":12}},{"id":"cb043a47-8c4a-4aa8-bc58-1258afc31d6f","block_type":"box","text":"initial sales charge at the time of purchase. A Fund will not accept a purchase order of $500,000 or more for","page_number":153,"box":{"x":70,"y":97,"width":778,"height":12}},{"id":"6db74a95-3857-4dfe-a934-cd6cc3e05d8c","block_type":"box","text":"Investor C Shares (may be lower on funds that have set a lower breakpoint for NAV). Your financial intermediary may","page_number":153,"box":{"x":70,"y":113,"width":826,"height":11}},{"id":"a5163c6a-bcde-4316-802b-d5cb856adf2a","block_type":"box","text":"set a lower maximum for Investor C Shares.","page_number":153,"box":{"x":69,"y":128,"width":311,"height":9}},{"id":"34ec13bb-fdd0-4b79-a2b9-21dd4d2a85fe","block_type":"box","text":"Investor C Shares are not available in accounts opened or held directly with a Fund that do not have a financial","page_number":153,"box":{"x":102,"y":150,"width":789,"height":12}},{"id":"71d83c29-5c5f-4119-abc3-063b8436a133","block_type":"box","text":"intermediary associated with the account.","page_number":153,"box":{"x":70,"y":166,"width":297,"height":11}},{"id":"4c3dfaa8-75e2-4d60-a0e1-dfd3da7e308d","block_type":"box","text":"If you select Investor C Shares, you do not pay an initial sales charge at the time of purchase.","page_number":153,"box":{"x":102,"y":188,"width":669,"height":12}},{"id":"1349dc11-6c2c-48a6-9b61-9268d7488a41","block_type":"box","text":"The deferred sales charge alternatives may be par ticularly appealing to investors who do not qualify for the","page_number":153,"box":{"x":101,"y":211,"width":763,"height":11}},{"id":"fa1716b0-bdeb-4c42-b4e3-cbbd5ae1d01d","block_type":"box","text":"reduction in initial sales charges. CDSC shares are subject to ongoing service fees and distribution fees; however,","page_number":153,"box":{"x":69,"y":226,"width":815,"height":11}},{"id":"084e35dc-019f-46ef-a31d-bc56b5ceae05","block_type":"box","text":"these fees potentially may be offset to the extent any return is realized on the additional funds initially invested in","page_number":153,"box":{"x":68,"y":241,"width":813,"height":11}},{"id":"6e9c33fe-87dd-4ca0-b273-afb130db3e58","block_type":"box","text":"CDSC shares.","page_number":153,"box":{"x":69,"y":256,"width":97,"height":9}},{"id":"044bafc8-f250-4ad4-bb79-4bd699d43e29","block_type":"box","text":"BlackRock compensates financial advisers and other financial intermediaries for selling CDSC shares at the time","page_number":153,"box":{"x":102,"y":279,"width":804,"height":11}},{"id":"168b2eef-e6f1-4ae0-bb89-8e7c5c4d3569","block_type":"box","text":"of purchase from its own funds. Proceeds from the CDSC and the distribution fee are paid to the Distributor and are","page_number":153,"box":{"x":69,"y":294,"width":827,"height":11}},{"id":"0a76b029-8ebd-4d27-bdd6-0fda78072960","block_type":"box","text":"used by the Distributor to defray the expenses of securities dealers or other financial intermediaries related to","page_number":153,"box":{"x":69,"y":309,"width":786,"height":11}},{"id":"45894cc3-5ced-43d5-82ef-774d75243706","block_type":"box","text":"providing distribution-related services to each Fund in connection with the sale of the CDSC shares. The combination","page_number":153,"box":{"x":70,"y":324,"width":831,"height":12}},{"id":"6c9a3919-acd0-4525-bf55-8c68ffa3d772","block_type":"box","text":"of the CDSC and the ongoing distribution fee facilitates the ability of each Fund to sell the CDSC shares without a","page_number":153,"box":{"x":69,"y":339,"width":809,"height":12}},{"id":"790a78c4-6f4e-422f-9c93-de6280e54cb7","block_type":"box","text":"sales charge being deducted at the time of purchase. See “Distribution and/or Shareholder Servicing Plans” below.","page_number":153,"box":{"x":69,"y":355,"width":824,"height":11}},{"id":"02141200-3d6c-4636-9f12-1853c868bfae","block_type":"box","text":"Imposition of the CDSC and the distribution fee on CDSC shares is limited by FINRA (as defined below) asset-based","page_number":153,"box":{"x":70,"y":370,"width":822,"height":11}},{"id":"97627728-ed29-48ed-815a-74db5e330faf","block_type":"box","text":"sales charge rule. See “Limitations on the Payment of Deferred Sales Charges” below.","page_number":153,"box":{"x":69,"y":385,"width":618,"height":11}},{"id":"c76d248b-736d-403b-b429-1141b98e9b77","block_type":"box","text":"Dealers will generally immediately receive commissions equal to 1.00% of the Investor C Shares sold by them","page_number":153,"box":{"x":102,"y":407,"width":782,"height":12}},{"id":"3ec825f5-fc6f-4665-a438-2976ac46c4b7","block_type":"box","text":"plus ongoing fees under the Fund’s Distribution and Service Plan. Dealers may not receive a commission in","page_number":153,"box":{"x":70,"y":423,"width":764,"height":11}},{"id":"f4715ddc-6586-47d6-9801-3512ee5562bf","block_type":"box","text":"connection with sales of Investor C Shares to cer tain employer-sponsored retirement plans sponsored by the Fund,","page_number":153,"box":{"x":69,"y":438,"width":820,"height":11}},{"id":"e6881266-3576-467d-97ad-5cf2d1f04c85","block_type":"box","text":"BlackRock or its affiliates, but may receive fees under the Distribution and Service Plan. These commissions and","page_number":153,"box":{"x":70,"y":453,"width":806,"height":11}},{"id":"b0b6626c-5fc7-411c-897c-fb7a03a4b412","block_type":"box","text":"payments may be different than the reallowances, placement fees and commissions paid to dealers in connection","page_number":153,"box":{"x":70,"y":468,"width":813,"height":11}},{"id":"3dedb033-81d4-4d67-8138-9dffdbac34c1","block_type":"box","text":"with sales of Investor A, Investor A1 and Investor P Shares. These may depend upon the policies, procedures and","page_number":153,"box":{"x":68,"y":483,"width":811,"height":11}},{"id":"b8922785-4ebf-4864-8901-5d5368a76374","block_type":"box","text":"trading platforms of your financial intermediary; consult your financial adviser.","page_number":153,"box":{"x":68,"y":498,"width":554,"height":11}},{"id":"f059b30e-c3b8-46db-8a08-850e8e2e3c3b","block_type":"box","text":"Each Fund has adopted an automatic conversion feature for Investor C Shares. Effective November 23, 2020,","page_number":153,"box":{"x":102,"y":521,"width":783,"height":11}},{"id":"e5224330-925a-419f-9651-2aafac1e719b","block_type":"box","text":"Investor C Shares held for approximately eight years will be conver ted into Investor A Shares, as set for th in each","page_number":153,"box":{"x":70,"y":536,"width":808,"height":11}},{"id":"a0f45100-26ca-4351-b5c5-f75a42fd11ee","block_type":"box","text":"Fund’s Prospectus. In addition, accounts that do not have a financial intermediary associated with them are not","page_number":153,"box":{"x":70,"y":551,"width":797,"height":11}},{"id":"9791498a-64c2-4e10-a156-91ffa3ab0597","block_type":"box","text":"eligible to hold Investor C Shares, and any Investor C Shares held in such accounts will be automatically conver ted to","page_number":153,"box":{"x":69,"y":566,"width":837,"height":11}},{"id":"c9ffb59a-6b2b-4a06-8730-adcd1c7ddddf","block_type":"box","text":"Investor A Shares.","page_number":153,"box":{"x":70,"y":581,"width":128,"height":9}},{"id":"69b2bbc9-2e9c-4889-9253-939b8864a07a","block_type":"box","text":"Conversion of Investor C Shares to Investor A Shares","page_number":153,"box":{"x":102,"y":604,"width":378,"height":9}},{"id":"5ca4dbae-84c0-4327-9a8d-21eaa1c9c546","block_type":"box","text":"Effective November 23, 2020 (the “Effective Date”), approximately eight years after purchase, Investor C Shares","page_number":153,"box":{"x":102,"y":627,"width":804,"height":11}},{"id":"5b3c91fb-61ab-4d60-b9b4-d74f4a228408","block_type":"box","text":"of each Fund will conver t automatically into Investor A Shares of that Fund (the “Investor C 8-Year Conversion”).","page_number":153,"box":{"x":69,"y":642,"width":794,"height":11}},{"id":"dcf8c74e-2a61-4e94-b44e-f8cc71411a43","block_type":"box","text":"Cer tain funds (the “Predecessor Funds”) were reorganized into new Funds (the “Successor Funds”) pursuant to","page_number":153,"box":{"x":69,"y":657,"width":794,"height":11}},{"id":"c15d5526-9de3-4c29-b2e6-27980608c7e5","block_type":"box","text":"reorganizations which occurred in September 2018. The holding period for Investor C Shares of Successor Funds","page_number":153,"box":{"x":69,"y":672,"width":806,"height":11}},{"id":"8562285d-0447-40a0-b090-be77fd16c56a","block_type":"box","text":"includes the period such shares were held in the respective Predecessor Fund. It is the financial intermediary’s","page_number":153,"box":{"x":70,"y":687,"width":793,"height":11}},{"id":"839597ed-f940-4259-b256-c3d0ecdc66e9","block_type":"box","text":"responsibility to ensure that the shareholder is credited with the proper holding period. As of the Effective Date,","page_number":153,"box":{"x":69,"y":702,"width":796,"height":12}},{"id":"c0195961-0efd-4504-979d-d56ab6b732d5","block_type":"box","text":"cer tain financial intermediaries, including group retirement recordkeeping platforms, may not have been tracking","page_number":153,"box":{"x":69,"y":717,"width":802,"height":12}},{"id":"dff61fd2-a87d-438e-b597-cb0641e9634d","block_type":"box","text":"such holding periods and therefore may not be able to process such conversions. In such instances, Investor C","page_number":153,"box":{"x":69,"y":732,"width":793,"height":12}},{"id":"7277e20c-4718-4092-bd39-a773085e0db5","block_type":"box","text":"Shares held as of the Effective Date will automatically conver t to Investor A Shares approximately eight years after","page_number":153,"box":{"x":69,"y":748,"width":817,"height":11}},{"id":"4d5fd547-7367-49b9-b8b3-8253c4ae333b","block_type":"box","text":"the Effective Date. If, as of November 23, 2028 (eight years after the Effective Date), a financial intermediary has","page_number":153,"box":{"x":68,"y":763,"width":814,"height":11}},{"id":"8efcd150-d15a-4619-ab24-34deb1afbfe2","block_type":"box","text":"not implemented systems or procedures to track holding periods commencing from the Effective Date, shareholders","page_number":153,"box":{"x":69,"y":778,"width":828,"height":11}},{"id":"e083672a-2094-4948-ab47-0c08bd903f73","block_type":"box","text":"holding Investor C Shares through such financial intermediary will no longer be eligible to hold Investor C Shares and","page_number":153,"box":{"x":69,"y":793,"width":832,"height":11}},{"id":"0a8e54de-7b2b-4641-8d5f-3bd9de70ce24","block_type":"box","text":"any such shares will conver t to Investor A Shares as soon as reasonably practicable after such date.","page_number":153,"box":{"x":69,"y":808,"width":718,"height":11}},{"id":"67e975ce-d27d-4052-98b7-bec64652dc22","block_type":"box","text":"In addition, accounts that do not have a financial intermediary associated with them are not eligible to hold","page_number":153,"box":{"x":102,"y":831,"width":764,"height":11}},{"id":"36d600ea-4660-43a8-8d06-23fc0315358c","block_type":"box","text":"Investor C Shares, and any Investor C Shares held in such accounts will be automatically conver ted into Investor A","page_number":153,"box":{"x":70,"y":846,"width":816,"height":11}},{"id":"edbe0d70-00e7-423b-bd97-f71212a7c859","block_type":"box","text":"Shares (the “Investor C Direct Accounts Conversion” and together with the Investor C 8-Year Conversion, the","page_number":153,"box":{"x":69,"y":861,"width":772,"height":11}},{"id":"58c14068-dcbb-442b-bc03-73e6b22e32b7","block_type":"box","text":"“Investor C Conversions”).","page_number":153,"box":{"x":70,"y":876,"width":186,"height":11}},{"id":"10b30e27-02f9-40f4-a6b1-8a78fa322059","block_type":"box","text":"II-106","page_number":153,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"1dcb1f3b-754d-46a9-a77f-99d881e7c665","block_type":"box","text":"NM1026U-6033063-153/246","page_number":153,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"542299a0-ab89-42de-87b7-979a77c7fc64","block_type":"box","text":"The Investor C Conversions will occur at least once each month (on the “Investor C Conversion Date”) on the","page_number":154,"box":{"x":101,"y":45,"width":776,"height":11}},{"id":"5c30cd01-2004-4ba2-bcbd-4739952052c9","block_type":"box","text":"basis of the relative NAV of the shares of the two applicable classes on the Investor C Conversion Date, without the","page_number":154,"box":{"x":69,"y":60,"width":824,"height":11}},{"id":"3c4ccc7c-ef5a-42ce-a19b-478a3cf2d146","block_type":"box","text":"imposition of any sales load, fee or other charge. The Investor C Conversions will not be deemed a purchase or sale","page_number":154,"box":{"x":70,"y":75,"width":827,"height":11}},{"id":"36495dcf-738f-4c68-82f6-2977871ff7f0","block_type":"box","text":"of the shares for U.S. federal income tax purposes. Shares acquired through reinvestment of dividends on Investor C","page_number":154,"box":{"x":69,"y":90,"width":833,"height":11}},{"id":"9daeab47-23b3-418a-8f48-b785a8475f1d","block_type":"box","text":"Shares will also conver t automatically to Investor A Shares, as set for th in each Fund’s Prospectus. The Investor C","page_number":154,"box":{"x":69,"y":105,"width":818,"height":11}},{"id":"1857e93f-f89b-4728-8df9-65685b1db20e","block_type":"box","text":"Conversion Date for dividend reinvestment shares will be calculated taking into account the length of time the shares","page_number":154,"box":{"x":69,"y":120,"width":836,"height":12}},{"id":"9705abd3-f870-4923-b070-c2ca117e4890","block_type":"box","text":"underlying the dividend reinvestment shares were outstanding.","page_number":154,"box":{"x":69,"y":136,"width":445,"height":11}},{"id":"a54ed72c-c4e2-4df3-a902-025be6c4e3b6","block_type":"box","text":"Contingent Deferred Sales Charge — Investor C Shares","page_number":154,"box":{"x":102,"y":158,"width":396,"height":11}},{"id":"ba230c8b-c12f-491a-8947-fbdfdd39dde3","block_type":"box","text":"Investor C Shares that are redeemed within one year of purchase may be subject to a 1.00% CDSC charged as a","page_number":154,"box":{"x":102,"y":181,"width":804,"height":11}},{"id":"f3092827-4f05-40bd-b9b5-bc8574913248","block_type":"box","text":"percentage of the dollar amount subject thereto. In determining whether an Investor C Shares CDSC is applicable to","page_number":154,"box":{"x":70,"y":196,"width":826,"height":11}},{"id":"c80d8344-dd35-474e-9171-a259e536627a","block_type":"box","text":"a redemption, the calculation will be determined in the manner that results in the lowest possible rate being charged.","page_number":154,"box":{"x":69,"y":211,"width":837,"height":11}},{"id":"7d0786b7-e979-40f4-bc5e-6e88892c3c34","block_type":"box","text":"The charge will be assessed on an amount equal to the lesser of the proceeds of redemption or the cost of the","page_number":154,"box":{"x":68,"y":226,"width":795,"height":11}},{"id":"aa235bd3-1d3f-4a42-8043-4e0e41b50076","block_type":"box","text":"shares being redeemed. Accordingly, no CDSC will be imposed on increases in NAV above the initial purchase price of","page_number":154,"box":{"x":69,"y":241,"width":840,"height":11}},{"id":"be4e2245-2e4c-4414-ab4a-42ad5a8207b8","block_type":"box","text":"Investor C Shares. In addition, no CDSC will be assessed on Investor C Shares acquired through reinvestment of","page_number":154,"box":{"x":70,"y":256,"width":804,"height":12}},{"id":"ceba884a-d6b8-4e97-ada0-044a28455091","block_type":"box","text":"dividends. It will be assumed that the redemption is first of shares held for over one year or shares acquired","page_number":154,"box":{"x":69,"y":271,"width":772,"height":12}},{"id":"dbd91686-18c3-4a09-a55c-41f4bf2f95ba","block_type":"box","text":"pursuant to reinvestment of dividends and then of shares held longest during the one-year period. A transfer of","page_number":154,"box":{"x":70,"y":286,"width":790,"height":12}},{"id":"a0369aaa-d078-4b73-bd04-139c9bf90e94","block_type":"box","text":"shares from a shareholder’s account to another account will be assumed to be made in the same order as a","page_number":154,"box":{"x":69,"y":302,"width":776,"height":9}},{"id":"a0c5ed6f-cbfc-4b9d-89a8-2cb629e17d0c","block_type":"box","text":"redemption.","page_number":154,"box":{"x":69,"y":317,"width":83,"height":11}},{"id":"54c2702f-397e-4eaf-94f9-3e661f6798a6","block_type":"box","text":"See “Information on Sales Charges and Distribution Related Expenses” in Par t I of each Fund’s SAI for","page_number":154,"box":{"x":102,"y":339,"width":734,"height":12}},{"id":"a351f4c1-3fe2-446d-98b6-2111dd5026fe","block_type":"box","text":"information about amounts paid to the Distributor in connection with CDSC shares for the periods indicated.","page_number":154,"box":{"x":70,"y":355,"width":769,"height":11}},{"id":"ac9a2b14-e7b7-4dad-bbcd-8709ee00a0c6","block_type":"box","text":"Investor C Shares — Contingent Deferred Sales Charge Waivers and Reductions","page_number":154,"box":{"x":102,"y":377,"width":572,"height":12}},{"id":"1a24e3ad-cad5-41c6-b84e-922f3bbda165","block_type":"box","text":"The CDSC on Investor C Shares is not charged in connection with: (1) redemptions of Investor C Shares","page_number":154,"box":{"x":101,"y":400,"width":740,"height":11}},{"id":"00076d3f-81e8-41c1-b116-e17f63de6388","block_type":"box","text":"purchased through cer tain employer-sponsored retirement plans and fee-based programs previously approved by","page_number":154,"box":{"x":70,"y":415,"width":802,"height":11}},{"id":"ac24ab19-c560-485c-8447-294094a0f048","block_type":"box","text":"cer tain Funds and rollovers of current investments in the Fund through such plans; (2) exchanges described in","page_number":154,"box":{"x":69,"y":430,"width":786,"height":11}},{"id":"5c431214-fde5-4978-9e0f-8e9ade32ee23","block_type":"box","text":"“Exchange Privilege” below; (3) redemptions made in connection with minimum required distributions due to the","page_number":154,"box":{"x":70,"y":445,"width":797,"height":12}},{"id":"a2cb6396-1f9c-4289-9bf8-a6770248b7e8","block_type":"box","text":"shareholder reaching age 72 from IRA and 403(b)(7) accounts; (4) redemptions made with respect to cer tain","page_number":154,"box":{"x":69,"y":460,"width":776,"height":12}},{"id":"6d3a686c-b0e2-4174-827e-d015350da597","block_type":"box","text":"retirement plans sponsored by the Fund, BlackRock or its affiliates; (5) redemptions in connection with a","page_number":154,"box":{"x":69,"y":475,"width":747,"height":12}},{"id":"d895055a-cdda-4acd-99c5-98401154118d","block_type":"box","text":"shareholder’s death as long as the waiver request is made within one year of death or, if later, reasonably promptly","page_number":154,"box":{"x":69,"y":491,"width":822,"height":11}},{"id":"6ceb8f8c-0cd1-4367-b49b-fa81e6d94e39","block_type":"box","text":"following completion of probate (including in connection with the distribution of account assets to a beneficiary of the","page_number":154,"box":{"x":68,"y":506,"width":836,"height":11}},{"id":"df168af8-72d0-49ba-80e3-b8fc9933fa50","block_type":"box","text":"decedent) or disability (as defined in the Code) subsequent to the purchase of Investor C Shares; (6) withdrawals","page_number":154,"box":{"x":69,"y":521,"width":806,"height":11}},{"id":"d3f84dab-7e94-44ac-87cf-5c3cc59a91b4","block_type":"box","text":"resulting from shareholder disability (as defined in the Code) as long as the disability arose subsequent to the","page_number":154,"box":{"x":69,"y":536,"width":786,"height":11}},{"id":"2c96aad8-9028-45e9-adf5-9371ad2cc47b","block_type":"box","text":"purchase of the shares; (7) involuntary redemptions of Investor C Shares in accounts with low balances as described","page_number":154,"box":{"x":70,"y":551,"width":834,"height":11}},{"id":"3d194b7f-ca52-40cb-8783-a9386d60db83","block_type":"box","text":"in “Redemption of Shares” below; (8) redemptions made pursuant to a systematic withdrawal plan, subject to the","page_number":154,"box":{"x":70,"y":566,"width":809,"height":11}},{"id":"fdece58e-1977-4657-bedc-174c7e1b6aae","block_type":"box","text":"limitations set for th under “Systematic Withdrawal Plan” below; (9) redemptions related to the payment of BNY","page_number":154,"box":{"x":70,"y":581,"width":791,"height":11}},{"id":"d48e833f-d2d8-4fa3-adff-d5dac91ed32a","block_type":"box","text":"Mellon Investment Servicing Trust Company custodial IRA fees; and (10) redemptions when a shareholder can","page_number":154,"box":{"x":70,"y":596,"width":784,"height":12}},{"id":"5b7b1af8-e1e7-4a6d-8210-ebefcdf4b6ec","block_type":"box","text":"demonstrate hardship, in the absolute discretion of the Fund. In addition, no CDSC is charged on Investor C Shares","page_number":154,"box":{"x":69,"y":612,"width":824,"height":11}},{"id":"6ce852ef-c6dd-49c1-9425-bc26801c81d0","block_type":"box","text":"acquired through the reinvestment of dividends or distributions.","page_number":154,"box":{"x":69,"y":627,"width":451,"height":11}},{"id":"d68489f8-a821-4d3c-b8c8-8397ce31cdb8","block_type":"box","text":"Cer tain CDSC waivers and reductions on Investor C Shares may be available to customers of cer tain financial","page_number":154,"box":{"x":102,"y":649,"width":781,"height":12}},{"id":"0eb5101f-d6cc-469c-ad3d-fb6decc35320","block_type":"box","text":"intermediaries, as described under “Intermediary-Defined Sales Charge Waiver Policies” in the Fund’s Prospectus.","page_number":154,"box":{"x":70,"y":664,"width":813,"height":12}},{"id":"c63b149d-5ffa-4050-8fba-3fd3e750d724","block_type":"box","text":"Please speak to your financial intermediary for more information.","page_number":154,"box":{"x":69,"y":680,"width":462,"height":11}},{"id":"a51e2fc1-a306-4494-9b75-cd44600e2010","block_type":"box","text":"Class R Shares","page_number":154,"box":{"x":69,"y":710,"width":110,"height":9}},{"id":"6f5bb27d-7121-4d8d-bfe9-b9e6219be768","block_type":"box","text":"Cer tain of the Funds offer Class R Shares as described in each such Fund’s Prospectus. Class R Shares are","page_number":154,"box":{"x":102,"y":732,"width":775,"height":11}},{"id":"b348d65e-3ccb-4b55-9a88-ac6d5854b23f","block_type":"box","text":"available only to cer tain employer-sponsored retirement plans. Class R Shares are not subject to an initial sales","page_number":154,"box":{"x":69,"y":748,"width":799,"height":11}},{"id":"0decedbf-6fe8-43b2-b645-bd0c2f896b4b","block_type":"box","text":"charge or a CDSC but are subject to an ongoing distribution fee of 0.25% per year and an ongoing service fee of","page_number":154,"box":{"x":69,"y":763,"width":801,"height":11}},{"id":"8138446f-2b3f-4e57-b26c-6bc45d9a5597","block_type":"box","text":"0.25% per year. Distribution fees are used to suppor t the Fund’s marketing and distribution effor ts, such as","page_number":154,"box":{"x":69,"y":778,"width":772,"height":11}},{"id":"a1117026-670b-4fef-a34b-63494f09a3de","block_type":"box","text":"compensating financial advisers and other financial intermediaries, adver tising and promotion. Service fees are used","page_number":154,"box":{"x":69,"y":793,"width":836,"height":11}},{"id":"e1334ada-183d-4404-a16f-eae78b682403","block_type":"box","text":"to compensate securities dealers and other financial intermediaries for service activities.","page_number":154,"box":{"x":68,"y":808,"width":636,"height":11}},{"id":"a3eb4537-2ab2-402f-885c-468a227e2af6","block_type":"box","text":"If Class R Shares are held over time, these fees may exceed the maximum sales charge that an investor would","page_number":154,"box":{"x":102,"y":831,"width":791,"height":11}},{"id":"2e101602-bb43-4e1c-a29f-9e8fda75a9f3","block_type":"box","text":"have paid as a shareholder of one of the other share classes.","page_number":154,"box":{"x":69,"y":846,"width":440,"height":11}},{"id":"6acce3aa-b48d-4e96-85cb-6f837d7c7c22","block_type":"box","text":"II-107","page_number":154,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"8cc70a0d-3b99-4d50-bb0e-d1369c9362a2","block_type":"box","text":"NM1026U-6033063-154/246","page_number":154,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"0adf0b75-ea78-4fa6-b7a8-4c3b597a5a2f","block_type":"box","text":"Class K Shares","page_number":155,"box":{"x":69,"y":45,"width":109,"height":9}},{"id":"9ab6656c-d56e-4a08-95dc-f47a6ad45e03","block_type":"box","text":"Cer tain Funds offer Class K Shares as described in each such Fund’s Prospectus. Class K Shares are available","page_number":155,"box":{"x":102,"y":67,"width":797,"height":11}},{"id":"4296e99c-ea3a-4042-a57f-a2dd84c319c7","block_type":"box","text":"only to (i) cer tain employee benefit plans, such as health savings accounts, and cer tain employer-sponsored","page_number":155,"box":{"x":69,"y":82,"width":772,"height":12}},{"id":"46aee1bf-e131-4824-9ba3-0bb353e678bb","block_type":"box","text":"retirement plans (not including SEP IRAs, SIMPLE IRAs and SARSEPs) (collectively, “Employer-Sponsored Retirement","page_number":155,"box":{"x":69,"y":98,"width":827,"height":11}},{"id":"9b046584-c666-43e6-bf77-3237fc952a8a","block_type":"box","text":"Plans”), (ii) collective trust funds, investment companies and other pooled investment vehicles, each of which may","page_number":155,"box":{"x":69,"y":113,"width":817,"height":11}},{"id":"35cfe8cf-9957-4d48-ae71-dc2b522663ad","block_type":"box","text":"purchase shares of the Fund through a financial intermediary that has entered into an agreement with the Distributor","page_number":155,"box":{"x":70,"y":128,"width":834,"height":11}},{"id":"a7fa06cf-03d6-4331-a8c9-860e52008ffe","block_type":"box","text":"to purchase such shares, (iii) “Institutional Investors,” which include but are not limited to, endowments,","page_number":155,"box":{"x":68,"y":143,"width":748,"height":11}},{"id":"8b6fc09f-a285-4762-8d39-2276ae3f649c","block_type":"box","text":"foundations, family offices, banks and bank trusts, local, city, and state governmental institutions, corporations and","page_number":155,"box":{"x":68,"y":158,"width":828,"height":11}},{"id":"b3c8a647-3df1-4d79-9753-1e5725a8f5d7","block_type":"box","text":"insurance company separate accounts, each of which may purchase shares of the Fund through a financial","page_number":155,"box":{"x":70,"y":173,"width":760,"height":11}},{"id":"8160b302-87c7-4401-94b6-501dac2b5b67","block_type":"box","text":"intermediary that has entered into an agreement with the Distributor to purchase such shares, (iv) clients of private","page_number":155,"box":{"x":70,"y":188,"width":823,"height":12}},{"id":"baecddfb-b5f3-4435-8379-41b75ca2db1e","block_type":"box","text":"banks that purchase shares of the Fund through a financial intermediary that has entered into an agreement with the","page_number":155,"box":{"x":69,"y":203,"width":836,"height":12}},{"id":"645610f3-c89e-4fa9-8f6c-e1ed50c09514","block_type":"box","text":"Distributor to sell such shares; (v) fee-based advisory platforms of a financial intermediary that (a) has specifically","page_number":155,"box":{"x":70,"y":218,"width":814,"height":12}},{"id":"7c282efa-6e10-4cea-8b0c-51c6f0002dd8","block_type":"box","text":"acknowledged in a written agreement with the Distributor and/or its affiliate(s) that the financial intermediary shall","page_number":155,"box":{"x":69,"y":234,"width":817,"height":11}},{"id":"9e16a24d-1600-4fbf-ba21-1238cd8af13b","block_type":"box","text":"offer such shares to fee-based advisory clients through an omnibus account held at the Fund or (b) transacts in the","page_number":155,"box":{"x":69,"y":249,"width":823,"height":11}},{"id":"eec98120-1e33-44f8-803c-8e1b0bfad7ed","block_type":"box","text":"Fund’s shares through another intermediary that has executed such an agreement and (vi) any other investors who","page_number":155,"box":{"x":70,"y":264,"width":818,"height":11}},{"id":"975dd6ba-1205-4ec7-b084-d41ab855478e","block_type":"box","text":"met the eligibility criteria for BlackRock Shares or Class K Shares prior to August 15, 2016 and have continually held","page_number":155,"box":{"x":69,"y":279,"width":833,"height":11}},{"id":"92b04d84-0a0f-4b45-a19e-f4e62d28370e","block_type":"box","text":"Class K Shares of the Fund or the respective Predecessor Fund in the same account since August 15, 2016. The","page_number":155,"box":{"x":69,"y":294,"width":807,"height":11}},{"id":"1160efa6-0462-495f-8ce1-f11d979d0f38","block_type":"box","text":"agreement referenced in (iv) above shall appear in a supplemental agreement to any selling, sub-transfer agent, or","page_number":155,"box":{"x":69,"y":309,"width":817,"height":11}},{"id":"690d8173-e469-4778-a8c5-b4cf85a25338","block_type":"box","text":"distribution and marketing agreement.","page_number":155,"box":{"x":69,"y":325,"width":270,"height":11}},{"id":"53589f4e-c5f1-41f4-92a5-052aece0daf0","block_type":"box","text":"Class K Shares are also available to employees, officers and directors/trustees of BlackRock, Inc. and","page_number":155,"box":{"x":102,"y":347,"width":734,"height":11}},{"id":"d8212e82-ed25-45d2-b910-55c7f7f3ea11","block_type":"box","text":"BlackRock Funds and immediate family members of such persons, if they open an account directly with BlackRock.","page_number":155,"box":{"x":70,"y":362,"width":817,"height":11}},{"id":"f748fcfc-5582-4f73-b0ff-b96e1c02fa2e","block_type":"box","text":"Eligible individuals who would like to conver t existing holdings to Class K Shares must contact BlackRock.","page_number":155,"box":{"x":70,"y":377,"width":753,"height":12}},{"id":"5570a2c5-4303-429b-90a5-5c68ba262a3d","block_type":"box","text":"Class G Shares","page_number":155,"box":{"x":69,"y":408,"width":110,"height":8}},{"id":"578da720-7324-47bc-9276-659bcf3fcb61","block_type":"box","text":"Cer tain Funds offer Class G Shares, which are available only to investors on eligible platforms. Eligible platforms","page_number":155,"box":{"x":102,"y":430,"width":804,"height":11}},{"id":"2d8666c4-06f6-44e0-b2a2-203e7443f2ab","block_type":"box","text":"are those where clients invest in the Fund through a single omnibus account in the name of a financial intermediary","page_number":155,"box":{"x":69,"y":445,"width":826,"height":12}},{"id":"fd79b02a-d359-46bc-902c-248f467658a0","block_type":"box","text":"that meets an initial investment minimum of $2 billion. For clients investing through such eligible platforms, the Fund","page_number":155,"box":{"x":68,"y":460,"width":836,"height":12}},{"id":"d15ca414-486e-419c-8c89-a0477b71cf7c","block_type":"box","text":"does not impose investment minimums on any individual investor. Financial intermediaries may impose separate","page_number":155,"box":{"x":69,"y":476,"width":803,"height":11}},{"id":"ab869d5e-f7d0-423c-a580-651895aa0d9e","block_type":"box","text":"eligibility requirements.","page_number":155,"box":{"x":69,"y":491,"width":164,"height":11}},{"id":"5029a0c4-220d-4625-89ba-3d656b3cc738","block_type":"box","text":"Service Shares","page_number":155,"box":{"x":68,"y":521,"width":109,"height":9}},{"id":"4f8afb90-ca01-4661-898b-faae5f0ae2aa","block_type":"box","text":"Cer tain Funds offer Service Shares, which are available only to cer tain investors, including: (i) cer tain financial","page_number":155,"box":{"x":102,"y":543,"width":788,"height":12}},{"id":"cca71384-5e1e-4c97-b454-05135cd3c744","block_type":"box","text":"institutions, such as banks and brokerage firms, acting on behalf of their customers; (ii) cer tain persons who were","page_number":155,"box":{"x":70,"y":559,"width":815,"height":11}},{"id":"96573480-38e3-43c5-822f-1a4ca39860bb","block_type":"box","text":"shareholders of the Compass Capital Group of Funds at the time of its combination with The PNC","page_number":155,"box":{"x":69,"y":574,"width":693,"height":11}},{"id":"91403276-8567-40f8-9d12-7c0af9dcc478","block_type":"box","text":"®","page_number":155,"box":{"x":763,"y":574,"width":6,"height":5}},{"id":"54845643-d453-47a5-ae4c-8abd4796cd30","block_type":"box","text":"Fund in 1996; and","page_number":155,"box":{"x":775,"y":574,"width":130,"height":10}},{"id":"fe912ab3-2b95-4eb0-aa30-41584aa0e404","block_type":"box","text":"(iii) par ticipants in the Capital Directions","page_number":155,"box":{"x":69,"y":589,"width":287,"height":11}},{"id":"51addd6f-49b7-487a-8eac-66763473f669","block_type":"box","text":"SM","page_number":155,"box":{"x":357,"y":589,"width":11,"height":5}},{"id":"fd6aeb0b-f05c-437a-bbf7-60a4143502c3","block_type":"box","text":"asset allocation program. Service Shares are not subject to an initial sales","page_number":155,"box":{"x":374,"y":589,"width":534,"height":11}},{"id":"6b94e15b-360e-4aa6-8bca-cb377500eb9b","block_type":"box","text":"charge or a CDSC but are subject to an ongoing service fee as set for th in the applicable Fund’s Prospectus.","page_number":155,"box":{"x":69,"y":604,"width":776,"height":11}},{"id":"9bf26e94-f718-41c8-b509-33ace37daf0b","block_type":"box","text":"BlackRock Shares","page_number":155,"box":{"x":69,"y":634,"width":133,"height":9}},{"id":"d84b03ec-302a-4d9b-9ea1-fa9864693f9e","block_type":"box","text":"Cer tain Funds offer BlackRock Shares, which are available only to cer tain investors. BlackRock Shares are","page_number":155,"box":{"x":102,"y":657,"width":760,"height":11}},{"id":"e4643609-6ca8-4e17-abf0-4e819cdca175","block_type":"box","text":"offered without a sales charge to institutional and individual investors, registered investment advisers and cer tain","page_number":155,"box":{"x":69,"y":672,"width":813,"height":11}},{"id":"66882646-b68a-4597-be96-7d7b3acdc23d","block_type":"box","text":"fee-based programs.","page_number":155,"box":{"x":68,"y":687,"width":145,"height":11}},{"id":"de0c939b-ebc8-4a3c-b15b-08df94828a05","block_type":"box","text":"Distribution and/or Shareholder Servicing Plans","page_number":155,"box":{"x":69,"y":718,"width":348,"height":11}},{"id":"cd3b9298-22e0-438e-90f0-4ed22035b5eb","block_type":"box","text":"Each Fund has adopted a plan (each, a “Plan”) pursuant to Rule 12b-1 under the Investment Company Act with","page_number":155,"box":{"x":102,"y":740,"width":790,"height":11}},{"id":"0ac78cc3-b7d1-45b6-a836-7d9afce46f59","block_type":"box","text":"respect to cer tain share classes that allows the Fund to pay distribution fees for the sale of its shares and","page_number":155,"box":{"x":69,"y":755,"width":761,"height":11}},{"id":"0dba891c-dc14-458e-84e7-6fffeacf4fd1","block_type":"box","text":"shareholder servicing fees for cer tain services provided to its shareholders.","page_number":155,"box":{"x":69,"y":770,"width":541,"height":12}},{"id":"78b1323b-d9f2-4899-bdf8-c2420bdda28d","block_type":"box","text":"Pursuant to the Plans, a Fund may pay BRIL and/or BlackRock, or any other affiliate or significant shareholder of","page_number":155,"box":{"x":102,"y":793,"width":803,"height":11}},{"id":"67ffa73b-0492-4efd-a121-2a70dcb5add2","block_type":"box","text":"BlackRock, fees for distribution and sales suppor t services with respect to Investor A, Investor A1, Investor C,","page_number":155,"box":{"x":70,"y":808,"width":783,"height":11}},{"id":"94f943e6-f75e-4862-8ca4-83b1f84dfd41","block_type":"box","text":"Investor P, Service and Class R Shares. Currently, as described fur ther below, only Investor C and Class R Shares","page_number":155,"box":{"x":70,"y":823,"width":809,"height":11}},{"id":"67913068-0e63-44bf-89d5-6d579cc6da81","block_type":"box","text":"bear the expense of distribution fees under a Plan.","page_number":155,"box":{"x":69,"y":838,"width":360,"height":11}},{"id":"6052a4a8-145c-4a04-832b-17270da44585","block_type":"box","text":"Each Fund has entered into a distribution agreement with BRIL under which BRIL, as agent, offers shares of","page_number":155,"box":{"x":102,"y":861,"width":770,"height":11}},{"id":"7d5f08fb-755f-4665-8ad8-7b36a00f76e3","block_type":"box","text":"each Fund on a continuous basis. BRIL has agreed to use appropriate effor ts to effect sales of the shares, but it is","page_number":155,"box":{"x":69,"y":876,"width":824,"height":11}},{"id":"b4eb1113-49b9-4966-9c83-d173bf820711","block_type":"box","text":"not obligated to sell any par ticular amount of shares. BRIL’s principal business address is 50 Hudson Yards, New","page_number":155,"box":{"x":69,"y":891,"width":812,"height":12}},{"id":"e1390d1a-bd51-4f02-bcc9-35c2fa5c9a82","block_type":"box","text":"York, NY 10001. BRIL is an affiliate of BlackRock.","page_number":155,"box":{"x":68,"y":906,"width":355,"height":11}},{"id":"997bafee-6fbc-4830-a607-777872669a7b","block_type":"box","text":"II-108","page_number":155,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"7b956e3c-d210-458e-9941-f362514c460e","block_type":"box","text":"NM1026U-6033063-155/246","page_number":155,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"834fb4cc-1984-4a80-996a-488a1a6c8c81","block_type":"box","text":"Pursuant to the Plans, each Fund may also pay shareholder servicing fees (also referred to as general","page_number":156,"box":{"x":102,"y":45,"width":727,"height":11}},{"id":"d1dac0c9-897e-473b-bf0a-69363a2fcfc9","block_type":"box","text":"shareholder liaison services fees) to affiliated and unaffiliated brokers, dealers, financial institutions, insurance","page_number":156,"box":{"x":69,"y":60,"width":799,"height":11}},{"id":"e4c4938b-4e58-4d95-898d-c5657fa1064d","block_type":"box","text":"companies, retirement plan record-keepers and other financial intermediaries (including BlackRock, BRIL and their","page_number":156,"box":{"x":69,"y":75,"width":813,"height":11}},{"id":"bfcc4194-b31a-49de-b596-c4468a121b7a","block_type":"box","text":"affiliates) (collectively, “Service Organizations”) for cer tain suppor t services rendered by Service Organizations to","page_number":156,"box":{"x":69,"y":90,"width":809,"height":11}},{"id":"960e0df4-32fc-4d3c-91f4-39a42a46d6a5","block_type":"box","text":"their customers (“Customers”) who are the beneficial owners of Investor A, Investor A1, Investor C, Investor P,","page_number":156,"box":{"x":68,"y":105,"width":786,"height":11}},{"id":"91851127-7af7-4c3c-8908-dabc52897032","block_type":"box","text":"Service and Class R Shares of a Fund. Such services are intended to supplement the services provided by the","page_number":156,"box":{"x":69,"y":120,"width":789,"height":11}},{"id":"210a3266-c941-46b1-b15f-f13d14d3cb7b","block_type":"box","text":"Fund’s Administrators and Transfer Agent to the Fund’s shareholders of record.","page_number":156,"box":{"x":70,"y":135,"width":562,"height":12}},{"id":"1c466670-6c89-4333-8f88-384183fd5434","block_type":"box","text":"The suppor t services provided by Service Organizations are general shareholder liaison services, which include,","page_number":156,"box":{"x":101,"y":158,"width":798,"height":11}},{"id":"08e557e6-69f0-44a8-8a20-baa03d721f27","block_type":"box","text":"but are not limited to: (i) answering Customer inquiries regarding account status and history, the manner in which","page_number":156,"box":{"x":69,"y":173,"width":808,"height":11}},{"id":"619d1f1f-d609-4167-9e5a-2b25e2e21148","block_type":"box","text":"purchases, exchanges and redemptions or repurchases of shares may be effected and cer tain other matters","page_number":156,"box":{"x":70,"y":188,"width":776,"height":12}},{"id":"75f37593-a5dc-4423-a8db-8ff883fc9bbf","block_type":"box","text":"per taining to the Customers’ investments; and (ii) assisting Customers in designating and changing dividend options,","page_number":156,"box":{"x":70,"y":203,"width":835,"height":12}},{"id":"9395548b-ee95-475e-9c2c-a1ded3216a74","block_type":"box","text":"account designations and addresses. The shareholder servicing fees payable pursuant to the Plans are paid to","page_number":156,"box":{"x":69,"y":218,"width":791,"height":12}},{"id":"72ab3943-73be-46ce-adcd-4aa5b31a193f","block_type":"box","text":"compensate Service Organizations for the administration and servicing of shareholder accounts and are not costs","page_number":156,"box":{"x":69,"y":234,"width":813,"height":11}},{"id":"313fa1e3-8c04-4a45-848b-d39f0b72cb1e","block_type":"box","text":"which are primarily intended to result in the sale of the Fund’s shares.","page_number":156,"box":{"x":68,"y":249,"width":501,"height":11}},{"id":"37c2a710-098b-4a8b-b71f-3c2e6d15ca9c","block_type":"box","text":"Payments under the Plans are based on a percentage of average daily net assets attributable to the shares in","page_number":156,"box":{"x":102,"y":271,"width":783,"height":12}},{"id":"34bc4c79-0101-4949-87d7-7876cf347ff7","block_type":"box","text":"the applicable share class regardless of the amount of expenses incurred. As a result, payments under the Plans","page_number":156,"box":{"x":68,"y":286,"width":810,"height":12}},{"id":"0efbe9e3-1397-47c9-bda6-0e82bf2ad24f","block_type":"box","text":"may be more or less than expenses incurred in connection with providing distribution and/or shareholder services","page_number":156,"box":{"x":69,"y":302,"width":813,"height":11}},{"id":"a68b7fb3-7807-4f4d-bfdd-1b5a71e27212","block_type":"box","text":"with respect to the related class. Information with respect to the payments under the Plans and expenses incurred in","page_number":156,"box":{"x":68,"y":317,"width":836,"height":11}},{"id":"cb9568ab-08f3-4afd-832f-1ef7b7b26ef5","block_type":"box","text":"providing services with respect to the related class is presented to the Directors for their consideration quar terly.","page_number":156,"box":{"x":70,"y":332,"width":805,"height":11}},{"id":"a369b51a-80ba-4147-9d60-12b89117b38e","block_type":"box","text":"Payments under the Plans consist of the shareholder servicing fees and the distribution fees. Expenses with respect","page_number":156,"box":{"x":69,"y":347,"width":832,"height":11}},{"id":"440d0593-e404-40eb-89d4-74d36e18b68e","block_type":"box","text":"to providing distribution and/or shareholder services with respect to a class may consist of Service Organization","page_number":156,"box":{"x":68,"y":362,"width":803,"height":11}},{"id":"8876e72a-6b99-4498-86c4-ad3feb37f44e","block_type":"box","text":"financial adviser compensation, branch office and regional operation center selling and transaction processing","page_number":156,"box":{"x":68,"y":377,"width":788,"height":12}},{"id":"83452540-67e7-4997-9be8-20d5ab1b141d","block_type":"box","text":"expenses, adver tising, sales promotion and marketing expenses. Payments under the Plans with respect to one","page_number":156,"box":{"x":69,"y":393,"width":798,"height":11}},{"id":"1df95ef5-d2a9-4b32-a33f-4db71f0cb1bd","block_type":"box","text":"class will not be used to finance the expenditures of another class. Sales personnel may receive different","page_number":156,"box":{"x":69,"y":407,"width":755,"height":12}},{"id":"4627917b-326d-4d35-8a4c-b289540478d0","block_type":"box","text":"compensation for selling different classes of shares.","page_number":156,"box":{"x":69,"y":423,"width":375,"height":11}},{"id":"f417be53-00df-4769-abb6-a66550429204","block_type":"box","text":"Each Plan is subject to the provisions of Rule 12b-1 under the Investment Company Act. In their consideration of","page_number":156,"box":{"x":102,"y":445,"width":803,"height":11}},{"id":"41fe3bec-f9c0-4419-9987-c21a3ce5613c","block_type":"box","text":"a Plan, the Directors must consider all factors they deem relevant, including information as to the benefits of the Plan","page_number":156,"box":{"x":69,"y":460,"width":839,"height":12}},{"id":"6ed154a4-0a08-4e87-b9ef-c44222cd03a8","block_type":"box","text":"to the Fund and the related class of shareholders. In approving a Plan in accordance with Rule 12b-1, the non","page_number":156,"box":{"x":68,"y":475,"width":788,"height":12}},{"id":"62af5874-ab10-4bb0-96c5-6052bbc31ea9","block_type":"box","text":"interested Directors concluded that there is reasonable likelihood that the Plan will benefit the Fund and its related","page_number":156,"box":{"x":70,"y":491,"width":818,"height":9}},{"id":"6a2940f4-da2f-4543-a997-37acea16815a","block_type":"box","text":"class of shareholders. The Plan provides, among other things, that: (i) the Board of Directors shall receive quar terly","page_number":156,"box":{"x":69,"y":506,"width":824,"height":11}},{"id":"26f93320-cd08-4785-8d0a-0fd455a2cfa6","block_type":"box","text":"repor ts regarding the amounts expended under the Plan and the purposes for which such expenditures were made;","page_number":156,"box":{"x":69,"y":521,"width":821,"height":11}},{"id":"cc94a561-9a6a-46ea-973b-c6423f6bebe0","block_type":"box","text":"(ii) the Plan will continue in effect for so long as its continuance is approved at least annually by the Board of","page_number":156,"box":{"x":69,"y":536,"width":778,"height":11}},{"id":"60b6f4f3-f34f-4e71-b413-7c2c029caab3","block_type":"box","text":"Directors, including the directors who are not “interested persons” of the Fund (as defined in the Investment","page_number":156,"box":{"x":70,"y":551,"width":773,"height":11}},{"id":"bfd749d6-f66a-469b-b45f-64552196bef6","block_type":"box","text":"Company Act) and who have no direct or indirect financial interest in the operation of the Plan or any agreement","page_number":156,"box":{"x":69,"y":566,"width":796,"height":11}},{"id":"46e1d394-ab57-4a81-b0bd-a0baae3c81b0","block_type":"box","text":"entered into in connection with the Plan (the “12b-1 Directors”), acting in person at a meeting called for said purpose","page_number":156,"box":{"x":69,"y":581,"width":837,"height":12}},{"id":"b70dc1d7-a7a7-4d59-8ff8-b9b29108fa6a","block_type":"box","text":"in accordance with Rule 12b-1 under the Investment Company Act; (iii) any material amendment thereto must be","page_number":156,"box":{"x":70,"y":597,"width":801,"height":11}},{"id":"72a6b3d6-9a6f-44fd-9992-ed234efd5f95","block_type":"box","text":"approved by the Board of Directors, including the 12b-1 Directors, acting in person at a meeting called for said","page_number":156,"box":{"x":69,"y":612,"width":787,"height":11}},{"id":"60be08a0-8c4b-4716-a196-6fd3c4089249","block_type":"box","text":"purpose; (iv) any amendment to increase materially the costs which any class of shares may bear for distribution","page_number":156,"box":{"x":70,"y":627,"width":802,"height":11}},{"id":"4d36980a-9573-46e0-98d3-31ad23e8ef2a","block_type":"box","text":"services pursuant to the Plan shall be effective only upon approval by a vote of a majority of the outstanding shares","page_number":156,"box":{"x":69,"y":642,"width":826,"height":11}},{"id":"580040ad-2d2d-40d4-9289-e7fea35c0f19","block_type":"box","text":"of such class and by a majority of the Board of Directors, including the 12b-1 Directors, acting in person at a meeting","page_number":156,"box":{"x":69,"y":657,"width":836,"height":11}},{"id":"9b89cb6a-efdb-4a0c-bbc4-d71875ccba48","block_type":"box","text":"called for said purpose; and (v) while the Plan remains in effect, the selection and nomination of the Fund’s Directors","page_number":156,"box":{"x":69,"y":672,"width":836,"height":11}},{"id":"4e9a1d94-e21e-4ed5-93b2-3ee1f20f53d8","block_type":"box","text":"who are not “interested persons” of the Fund shall be committed to the discretion of the Fund’s non-interested","page_number":156,"box":{"x":68,"y":687,"width":792,"height":11}},{"id":"cd29dc69-4253-4b45-b636-d45587fb74bd","block_type":"box","text":"Directors. Rule 12b-1 fur ther requires that each Fund preserve copies of each Plan and any repor t made pursuant to","page_number":156,"box":{"x":70,"y":702,"width":831,"height":11}},{"id":"76bc22cd-a620-4aa8-8e08-3c391272cb62","block_type":"box","text":"such Plan for a period of not less than six years from the date of the Plan or such repor t, the first two years in an","page_number":156,"box":{"x":69,"y":717,"width":807,"height":12}},{"id":"8337bb41-c8d6-423f-85b9-559ede68bd38","block_type":"box","text":"easily accessible place.","page_number":156,"box":{"x":69,"y":733,"width":167,"height":11}},{"id":"8fc16d0e-9c2c-400e-b8e8-a03e98c16e34","block_type":"box","text":"Each Plan is terminable as to any class of shares without penalty at any time by a vote of a majority of the 12b-1","page_number":156,"box":{"x":102,"y":755,"width":804,"height":11}},{"id":"8515039e-7d42-4348-bce9-32dfc26089b9","block_type":"box","text":"Directors, or by vote of the holders of a majority of the shares of such class.","page_number":156,"box":{"x":70,"y":770,"width":542,"height":11}},{"id":"02fc7785-c23e-456a-8c24-29f45bf80551","block_type":"box","text":"See “Information on Sales Charges and Distribution Related Expenses” in Par t I of each Fund’s SAI for","page_number":156,"box":{"x":102,"y":793,"width":734,"height":11}},{"id":"c1e82a37-8201-4fc6-aa12-625c261afae7","block_type":"box","text":"information relating to the fees paid by your Fund to the Distributor under each Plan during the Fund’s most recent","page_number":156,"box":{"x":70,"y":808,"width":814,"height":11}},{"id":"b3d6e6a5-19f6-4164-a839-dbcbff1e4470","block_type":"box","text":"fiscal year.","page_number":156,"box":{"x":68,"y":823,"width":75,"height":11}},{"id":"54f948c5-146f-468c-aa6f-7cbac78885f8","block_type":"box","text":"Limitations on the Payment of Deferred Sales Charges","page_number":156,"box":{"x":69,"y":854,"width":396,"height":11}},{"id":"a52c4c20-a30b-43f9-b475-d8c43be59561","block_type":"box","text":"The maximum sales charge rule in the Conduct Rules of the Financial Industry Regulatory Authority (“FINRA”)","page_number":156,"box":{"x":101,"y":876,"width":777,"height":11}},{"id":"e93826ec-b955-4f5d-8dbd-6db1ed1c31ea","block_type":"box","text":"imposes a limitation on cer tain asset-based sales charges such as the distribution fee borne by Class R Shares, and","page_number":156,"box":{"x":70,"y":891,"width":835,"height":12}},{"id":"74783db6-eefb-49c4-b8ec-810ef5f6fb51","block_type":"box","text":"the distribution fee and the CDSC borne by the Investor C Shares. This limitation does not apply to the shareholder","page_number":156,"box":{"x":68,"y":906,"width":822,"height":12}},{"id":"bbcc9fe3-46b0-4f06-a5c9-4bc2bab714b9","block_type":"box","text":"II-109","page_number":156,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"6e81121b-be6f-4653-854e-d2ff3e656380","block_type":"box","text":"NM1026U-6033063-156/246","page_number":156,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"4eb3a059-f988-457d-a459-1393cc054fea","block_type":"box","text":"servicing fee. The maximum sales charge rule is applied separately to each class and limits the aggregate of","page_number":157,"box":{"x":69,"y":45,"width":778,"height":11}},{"id":"caf78f90-e536-4aaf-ae47-134871c96417","block_type":"box","text":"distribution fee payments and CDSCs payable by a Fund to (1) 6.25% of eligible gross sales of Investor C and Class R","page_number":157,"box":{"x":69,"y":60,"width":840,"height":11}},{"id":"38d72e7e-36df-4d00-984b-0c94f4c17f41","block_type":"box","text":"Shares, computed separately (excluding shares issued pursuant to dividend reinvestments and exchanges), plus","page_number":157,"box":{"x":69,"y":75,"width":803,"height":11}},{"id":"79131132-ddd5-4db6-92dc-065686e9335b","block_type":"box","text":"(2) interest on the unpaid balance for the respective class, computed separately, at the prime rate plus 1% (the","page_number":157,"box":{"x":69,"y":90,"width":794,"height":11}},{"id":"3d6b188e-853a-40f6-b3ca-39308055ef64","block_type":"box","text":"unpaid balance being the maximum amount payable minus amounts received from the payment of the distribution fee","page_number":157,"box":{"x":69,"y":105,"width":839,"height":11}},{"id":"105cd460-a519-4157-9ac2-39c162c5c7eb","block_type":"box","text":"and the CDSC). See “Information on Sales Charges and Distribution Related Expenses” in Par t I of each Fund’s SAI","page_number":157,"box":{"x":69,"y":120,"width":824,"height":12}},{"id":"a7217939-33e1-47c8-91fa-dfb698146974","block_type":"box","text":"for comparative information as of your Fund’s most recent fiscal year end with respect to, if applicable, the Investor C","page_number":157,"box":{"x":68,"y":135,"width":839,"height":11}},{"id":"ddae262c-9726-481c-8791-d8df6fec7b49","block_type":"box","text":"and Class R Shares of your Fund.","page_number":157,"box":{"x":69,"y":150,"width":236,"height":12}},{"id":"c94dbf49-d447-400d-8f9e-cc432737bc91","block_type":"box","text":"Other Payments by the Fund","page_number":157,"box":{"x":69,"y":181,"width":206,"height":11}},{"id":"910b4e05-c9ae-4131-9ae1-6ffc785a3d73","block_type":"box","text":"In addition to shareholder servicing fees that a Fund may pay to a Service Organization pursuant to the Plan and","page_number":157,"box":{"x":102,"y":203,"width":800,"height":12}},{"id":"6bf1d65f-a39d-4e1b-b486-59753bc55169","block_type":"box","text":"fees the Fund pays to its Transfer Agent, BlackRock, on behalf of a Fund, may enter into non-Plan agreements with","page_number":157,"box":{"x":68,"y":218,"width":816,"height":12}},{"id":"7b874eee-6abd-4b2b-8444-451c6ba429c7","block_type":"box","text":"Service Organizations pursuant to which the Fund will pay a Service Organization for administrative, networking,","page_number":157,"box":{"x":69,"y":234,"width":794,"height":11}},{"id":"802292cc-c23f-401f-9c69-422ca5755884","block_type":"box","text":"recordkeeping, sub-transfer agency, sub-accounting and/or shareholder services. These non-Plan payments are","page_number":157,"box":{"x":69,"y":249,"width":792,"height":11}},{"id":"bbce1003-8e81-4e52-a5d2-247fb195052e","block_type":"box","text":"generally based on either (1) a percentage of the average daily net assets of Fund shareholders serviced by a Service","page_number":157,"box":{"x":68,"y":264,"width":841,"height":11}},{"id":"170af529-e24d-4706-80b1-cce9b6762837","block_type":"box","text":"Organization or (2) a fixed dollar amount for each account serviced by a Service Organization. The aggregate amount","page_number":157,"box":{"x":69,"y":279,"width":831,"height":11}},{"id":"3b1c20da-4606-4d58-a88d-25cb72f6f4b0","block_type":"box","text":"of these payments may be substantial.","page_number":157,"box":{"x":69,"y":294,"width":276,"height":11}},{"id":"bc613729-e974-4d1b-b197-f77080c1785d","block_type":"box","text":"Additional Payments by BlackRock","page_number":157,"box":{"x":68,"y":324,"width":256,"height":11}},{"id":"a5c1cccd-ebb2-4c8b-b897-68494f6b10c2","block_type":"box","text":"From time to time, BlackRock, BRIL and/or their affiliates (referred to in this section collectively as “BlackRock”)","page_number":157,"box":{"x":102,"y":347,"width":803,"height":11}},{"id":"9053d80b-a20c-4ffd-a552-edea48b2ae7e","block_type":"box","text":"may compensate Service Organizations for the sale and distribution of shares of a Fund, for services to a Fund and","page_number":157,"box":{"x":69,"y":362,"width":823,"height":11}},{"id":"3c224300-ea42-4922-bdcc-e163fdd88e90","block_type":"box","text":"its shareholders and/or for data provision or technology suppor t. A Service Organization may per form these","page_number":157,"box":{"x":70,"y":377,"width":768,"height":12}},{"id":"3da7bcee-063f-4480-8611-d68256be8e04","block_type":"box","text":"obligations itself or may arrange for a third par ty to per form them. These payments, which are not made pursuant to","page_number":157,"box":{"x":69,"y":392,"width":830,"height":12}},{"id":"9837bc8c-8083-4828-8253-3dff73989b32","block_type":"box","text":"a Plan or otherwise paid by a Fund, are referred to as “Additional Payments” herein.","page_number":157,"box":{"x":69,"y":407,"width":599,"height":12}},{"id":"2d1eef9a-30c1-40a3-a74e-a90cc3afc29f","block_type":"box","text":"Additional Payments are made from BlackRock’s own assets (which may come directly or indirectly from fees","page_number":157,"box":{"x":101,"y":430,"width":776,"height":11}},{"id":"16c564ff-4d19-4399-beec-3ed97d4234f9","block_type":"box","text":"paid by a Fund to BlackRock for various services, such as investment advisory services). These payments are not an","page_number":157,"box":{"x":70,"y":445,"width":832,"height":11}},{"id":"e5dee94d-5d82-46b8-994a-38a069ed6470","block_type":"box","text":"additional charge to a Fund or its shareholders and do not change the price paid by shareholders for the purchase of","page_number":157,"box":{"x":69,"y":460,"width":833,"height":12}},{"id":"59069b13-abb9-41ee-ad5f-7dad4635fb70","block_type":"box","text":"a Fund’s shares or the amount a Fund receives as proceeds from such purchases. Additional Payments made to","page_number":157,"box":{"x":69,"y":475,"width":802,"height":12}},{"id":"50c1d4de-dd14-4da4-ac5c-806b8b46a315","block_type":"box","text":"Service Organizations are in addition to any distribution or shareholder servicing fees paid under any Plan of any","page_number":157,"box":{"x":69,"y":491,"width":802,"height":11}},{"id":"51684713-9cc8-4991-81a2-c0e6d1006ad8","block_type":"box","text":"Fund, any sales charges, commissions or other concessions described in the Prospectuses or this SAI, and any","page_number":157,"box":{"x":70,"y":506,"width":796,"height":11}},{"id":"bfa74ab2-795e-4fca-a2a5-6a274a0c67c9","block_type":"box","text":"administrative, networking, recordkeeping, sub-transfer agency or sub-accounting fees payable by a Fund. 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While FINRA","page_number":157,"box":{"x":69,"y":551,"width":837,"height":11}},{"id":"073c52cd-c976-4f9f-83cb-aa8df0e61631","block_type":"box","text":"regulations limit the sales charges that shareholders may bear, there are no limits with regard to the amounts that","page_number":157,"box":{"x":69,"y":566,"width":818,"height":11}},{"id":"88ee07ff-b3db-45ce-86db-9f3ae8244340","block_type":"box","text":"BlackRock may pay out of its own assets.","page_number":157,"box":{"x":70,"y":581,"width":294,"height":11}},{"id":"d3378ad4-dbd6-4ad8-b935-b29c4f1f9673","block_type":"box","text":"Additional Payments may be made as a fixed dollar amount, may be based on the number of Customer accounts","page_number":157,"box":{"x":101,"y":604,"width":803,"height":11}},{"id":"067e89d1-8330-4cf6-a833-f7f483158d32","block_type":"box","text":"maintained by a Service Organization, may be based on a percentage of the value of shares sold to, or held by,","page_number":157,"box":{"x":69,"y":619,"width":792,"height":11}},{"id":"4844c350-9327-4430-99d1-105f5ff90e4b","block_type":"box","text":"Customers of the Service Organization involved, or may be calculated on another basis.","page_number":157,"box":{"x":69,"y":634,"width":623,"height":12}},{"id":"1beb9246-2338-4a99-963e-6bd896f89724","block_type":"box","text":"BlackRock negotiates Additional Payments with each Service Organization on an individual basis. Additional","page_number":157,"box":{"x":102,"y":657,"width":765,"height":11}},{"id":"01ab602d-078f-43fd-aac1-725b2c92ab31","block_type":"box","text":"Payments may be different for different Service Organizations, and some Service Organizations may be paid pursuant","page_number":157,"box":{"x":69,"y":672,"width":841,"height":11}},{"id":"a30e2e92-041d-413b-9128-c4d6687c2253","block_type":"box","text":"to more than one of the calculations described above. Not all Service Organizations receive Additional Payments.","page_number":157,"box":{"x":68,"y":687,"width":806,"height":11}},{"id":"9280a2ca-b55e-4481-a707-2eec5ac6b890","block_type":"box","text":"Sales-based payments primarily create incentives to make new sales of shares of the Fund, and asset-based","page_number":157,"box":{"x":69,"y":702,"width":776,"height":11}},{"id":"a25e15f0-7347-482e-bd80-f08f1b717cbb","block_type":"box","text":"payments primarily create incentives to retain previously sold shares of the Fund. The level of payments made to","page_number":157,"box":{"x":70,"y":717,"width":802,"height":12}},{"id":"d3937f0d-db78-42e0-95e9-20dfdcab0c6b","block_type":"box","text":"these Service Organizations in any year will vary and may be limited to specific Funds or share classes. In cer tain","page_number":157,"box":{"x":68,"y":732,"width":811,"height":12}},{"id":"378b0ad8-5080-4208-a4a7-1da199f7a179","block_type":"box","text":"cases, these payments may be subject to cer tain minimum payment levels.","page_number":157,"box":{"x":69,"y":748,"width":538,"height":11}},{"id":"c117f82b-3bd8-4db7-9b88-129be43c9f24","block_type":"box","text":"The aggregate amount of Additional Payments made by BlackRock may be substantial and may be significant to","page_number":157,"box":{"x":101,"y":770,"width":795,"height":12}},{"id":"3448363c-d4ae-4110-ad5f-37b7ecfaa2b5","block_type":"box","text":"cer tain Service Organizations. The categories of Additional Payments listed below are not mutually exclusive. The","page_number":157,"box":{"x":69,"y":785,"width":807,"height":12}},{"id":"93929a73-65c5-415a-a15c-f5d88ad04b57","block_type":"box","text":"same Service Organization, or one or more of its affiliates, may receive payments under more than one category of","page_number":157,"box":{"x":69,"y":801,"width":823,"height":11}},{"id":"9b8a9877-c1b1-404a-9cb2-5e2fa285c6c4","block_type":"box","text":"Additional Payments. Such payments may be different for different Service Organizations and for different types of","page_number":157,"box":{"x":68,"y":816,"width":819,"height":11}},{"id":"92d8d473-4847-4f05-b23c-c4fe225d3493","block_type":"box","text":"Funds.","page_number":157,"box":{"x":70,"y":831,"width":44,"height":9}},{"id":"a0d45111-1eae-49a5-bbb5-a60c2ea4e101","block_type":"box","text":"A. Distribution and Marketing Suppor t","page_number":157,"box":{"x":101,"y":854,"width":270,"height":11}},{"id":"4fef34ba-1305-4713-ac41-fbe360398407","block_type":"box","text":"Additional Payments may be made by BlackRock for distribution and marketing suppor t activities. 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These payments","page_number":158,"box":{"x":68,"y":150,"width":805,"height":12}},{"id":"cf3f9f38-7c39-4d79-baed-61b5048272e3","block_type":"box","text":"normally will not exceed the sum of (a) 0.25% of such year’s Fund sales by that Service Organization, and (b) 0.21%","page_number":158,"box":{"x":69,"y":166,"width":828,"height":11}},{"id":"bac436d5-c403-44fe-bcd8-c09de3b60bd8","block_type":"box","text":"of the assets attributable to that Service Organization invested in a Fund.","page_number":158,"box":{"x":69,"y":181,"width":523,"height":11}},{"id":"13abdf11-c808-451d-87ce-d83611913265","block_type":"box","text":"B. Shareholder Services","page_number":158,"box":{"x":102,"y":203,"width":172,"height":9}},{"id":"f4a42b3e-7a31-4d00-a3b6-808276ac2884","block_type":"box","text":"Many Fund shares are owned or held by Service Organizations for the benefit of their Customers. 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Conflicts","page_number":161,"box":{"x":102,"y":872,"width":78,"height":9}},{"id":"5a743985-4378-4c8d-9eaa-394e5a28a6c9","block_type":"box","text":"Additional Payments made by BlackRock to a Service Organization or its affiliates or other incentive","page_number":161,"box":{"x":101,"y":895,"width":710,"height":11}},{"id":"18c5d843-b6a5-4e3c-94a4-f81a3d65d1bb","block_type":"box","text":"arrangements may be an impor tant factor in the Service Organization’s willingness to suppor t the sale of a Fund","page_number":161,"box":{"x":69,"y":910,"width":803,"height":11}},{"id":"933f1f1b-dbc9-4cba-bd78-af0615522595","block_type":"box","text":"II-114","page_number":161,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"30fca2d0-6dff-4e4d-a8a3-28243c37f30f","block_type":"box","text":"NM1026U-6033063-161/246","page_number":161,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"6fc383f7-194d-4f25-9d58-7c9f8a7a2ce5","block_type":"box","text":"and/or par ticular share class through its distribution system or to per form services with respect to such Fund.","page_number":162,"box":{"x":69,"y":45,"width":788,"height":11}},{"id":"af427538-dec2-4cba-86f0-4d798ab0d36d","block_type":"box","text":"Additional Payments and other incentive arrangements may also be impor tant factors in the Service Organization’s","page_number":162,"box":{"x":68,"y":60,"width":819,"height":11}},{"id":"197ba090-a934-4e6b-a0a5-70f454ae527a","block_type":"box","text":"willingness to recommend the BlackRock Fund complex in general.","page_number":162,"box":{"x":68,"y":75,"width":473,"height":11}},{"id":"86b24ca1-b0f4-4ae2-9d4e-bd96ae2e8f20","block_type":"box","text":"BlackRock may be motivated to pay Additional Payments and other incentive compensation to promote the sale","page_number":162,"box":{"x":102,"y":98,"width":793,"height":11}},{"id":"c49bc608-1247-476c-94a6-424b781c0ceb","block_type":"box","text":"of Fund shares to Customers of Service Organizations and the retention of those investments by such Customers. To","page_number":162,"box":{"x":69,"y":113,"width":835,"height":11}},{"id":"3617c5ca-2881-47ee-ba08-c5ce0498408f","block_type":"box","text":"the extent Service Organizations sell more shares of a Fund or retain shares of a Fund in their Customers’ accounts,","page_number":162,"box":{"x":68,"y":128,"width":833,"height":11}},{"id":"47461d78-50d0-48e1-b474-50bf92cfbde9","block_type":"box","text":"BlackRock benefits from the incremental management and other fees paid by the Fund with respect to those assets.","page_number":162,"box":{"x":70,"y":143,"width":830,"height":11}},{"id":"e7ddba86-85fd-4326-bc09-1b89ad33aec0","block_type":"box","text":"Service Organizations may have financial incentives for recommending a par ticular Fund, share class or fund","page_number":162,"box":{"x":102,"y":166,"width":774,"height":11}},{"id":"582ae1ae-6fce-4719-bdbf-ae7f51c4a0bc","block_type":"box","text":"complex over another. Service Organizations may charge their Customers additional fees in connection with the","page_number":162,"box":{"x":69,"y":181,"width":794,"height":11}},{"id":"ff7b0bdb-db78-4618-b1b3-8c030f5e1830","block_type":"box","text":"purchase or redemption of Fund shares or for account-related services which are in addition to the sales and other","page_number":162,"box":{"x":70,"y":196,"width":818,"height":11}},{"id":"ba8aa9db-319e-4d25-a676-0c38ba73b1ee","block_type":"box","text":"charges described in the Fund’s Prospectus and this SAI. Such charges may vary among Service Organizations but in","page_number":162,"box":{"x":69,"y":211,"width":836,"height":11}},{"id":"ef217193-c2bd-4309-a279-7826a96fab73","block_type":"box","text":"all cases will be retained by the Service Organization and will not be remitted to a Fund or BlackRock.","page_number":162,"box":{"x":69,"y":226,"width":723,"height":11}},{"id":"ddc8de0f-da24-47ac-8271-85d09394b8eb","block_type":"box","text":"Shareholders should consider whether such incentives exist when evaluating any recommendations from a","page_number":162,"box":{"x":102,"y":249,"width":759,"height":11}},{"id":"5f76fe2f-3426-4ccd-afc0-4c9e2c11e8a9","block_type":"box","text":"Service Organization to purchase or sell shares of a Fund and when considering which share class is most","page_number":162,"box":{"x":69,"y":264,"width":760,"height":11}},{"id":"4d51a6eb-20c8-41c2-8706-ec843b19575f","block_type":"box","text":"appropriate.","page_number":162,"box":{"x":69,"y":279,"width":84,"height":11}},{"id":"0fab65d5-d6f9-4be5-9e87-80bdff574a62","block_type":"box","text":"You should consult with your Service Organization, and review carefully any disclosure by the Service","page_number":162,"box":{"x":160,"y":279,"width":738,"height":11}},{"id":"849e3081-2301-4e00-a69e-9851c97b41c4","block_type":"box","text":"Organization, as to compensation received by it or its affiliates and for more information about the payments","page_number":162,"box":{"x":69,"y":294,"width":795,"height":11}},{"id":"62cf435b-b348-472d-bb12-6306d4829c4b","block_type":"box","text":"described above.","page_number":162,"box":{"x":69,"y":309,"width":122,"height":9}},{"id":"e99fc0a4-dd7d-40f3-96df-fee2c60e70bc","block_type":"box","text":"REDEMPTION OF SHARES","page_number":162,"box":{"x":385,"y":339,"width":208,"height":9}},{"id":"a5bc8332-31b2-4668-ad72-654e11843540","block_type":"box","text":"Shares normally will be redeemed for cash upon receipt of a request in proper form, although each Fund retains","page_number":162,"box":{"x":102,"y":361,"width":798,"height":12}},{"id":"ceb1d912-3043-4bab-8b8d-79fa634a5887","block_type":"box","text":"the right to redeem some or all of its shares in-kind under unusual circumstances (valued in the same way as they","page_number":162,"box":{"x":68,"y":377,"width":817,"height":11}},{"id":"d1704bb1-7cef-47d0-ae2c-dcc1289b0200","block_type":"box","text":"would be valued for purposes of computing a Fund’s NAV), in order to protect the interests of remaining shareholders,","page_number":162,"box":{"x":68,"y":392,"width":840,"height":11}},{"id":"682a4628-4620-46e1-a735-5a625dd35397","block_type":"box","text":"or to accommodate a request by a par ticular shareholder that does not adversely affect the interest of the remaining","page_number":162,"box":{"x":69,"y":407,"width":834,"height":11}},{"id":"ef9ebcdc-569f-4913-9c42-fa03db8a47cb","block_type":"box","text":"shareholders, by delivery of securities and other assets selected from the Fund’s por tfolio holdings at its discretion.","page_number":162,"box":{"x":69,"y":422,"width":829,"height":11}},{"id":"658ce630-9196-4bda-9a89-5f08113af392","block_type":"box","text":"In-kind payment means payment will be made in por tfolio securities and other assets rather than cash. If this occurs,","page_number":162,"box":{"x":70,"y":437,"width":834,"height":11}},{"id":"f9b16ee0-c886-48ba-aa66-0afc1037159d","block_type":"box","text":"the redeeming shareholder might incur brokerage or other transaction costs to conver t the securities and other","page_number":162,"box":{"x":68,"y":452,"width":793,"height":11}},{"id":"9b81b643-8dda-4fd1-a3b7-18a0765669f1","block_type":"box","text":"assets to cash. In an in-kind redemption, a pro rata por tion of a Fund’s por tfolio holdings will generally be distributed","page_number":162,"box":{"x":69,"y":467,"width":834,"height":12}},{"id":"b475d661-5c33-42ee-8626-f9dcad4c0745","block_type":"box","text":"to the redeeming shareholder, but an Index Fund may, under cer tain circumstances, deviate from pro rata redemption","page_number":162,"box":{"x":68,"y":482,"width":838,"height":12}},{"id":"eb5b4603-3e55-4019-a043-40bc8a90f416","block_type":"box","text":"if the securities and other assets to be distributed are deemed to be a fair representation of por tfolio holdings and","page_number":162,"box":{"x":70,"y":498,"width":818,"height":11}},{"id":"025a0081-849e-4422-80bc-bdd97184a821","block_type":"box","text":"the interests of the remaining shareholders in the Index Fund are not diluted. Each Fund has elected, however, to be","page_number":162,"box":{"x":68,"y":513,"width":831,"height":11}},{"id":"188ac80d-297b-4f3d-b09a-b158084daf87","block_type":"box","text":"governed by Rule 18f-1 under the Investment Company Act so that the Fund is obligated to redeem its shares solely","page_number":162,"box":{"x":68,"y":528,"width":828,"height":11}},{"id":"1d607ad2-3cf6-4d7b-abae-96f3cf5d29d3","block_type":"box","text":"in cash up to the lesser of $250,000 or 1% of its NAV during any 90-day period for any shareholder of the Fund. The","page_number":162,"box":{"x":70,"y":542,"width":826,"height":12}},{"id":"37fef713-b77a-4676-92f1-c50e3f7f4fdc","block_type":"box","text":"redemption price is the NAV per share next determined after the initial receipt of proper notice of redemption. The","page_number":162,"box":{"x":69,"y":558,"width":810,"height":11}},{"id":"4c24e6c3-759b-40f6-b8a4-f6929a9cff2b","block_type":"box","text":"value of shares of each Fund at the time of redemption may be more or less than your cost at the time of purchase,","page_number":162,"box":{"x":68,"y":573,"width":827,"height":11}},{"id":"c59180ad-3422-487d-8787-33c5f6a15e3e","block_type":"box","text":"depending in par t on the market value of the securities held by the Fund at such time. Except for any CDSC that may","page_number":162,"box":{"x":69,"y":588,"width":832,"height":12}},{"id":"ef3a4215-62bc-4eed-8e2f-38be7709e67f","block_type":"box","text":"be applicable, there will be no redemption charge if your redemption request is sent directly to the Transfer Agent. If","page_number":162,"box":{"x":69,"y":603,"width":828,"height":12}},{"id":"7e1e95b6-d615-4837-88de-12eb0edeb0d9","block_type":"box","text":"you are liquidating your holdings you will receive all dividends reinvested through the date of redemption.","page_number":162,"box":{"x":68,"y":618,"width":746,"height":12}},{"id":"4861961e-41cb-4884-9646-bc22c3813988","block_type":"box","text":"The right to redeem shares may be suspended or payment upon redemption may be delayed for more than seven","page_number":162,"box":{"x":101,"y":641,"width":807,"height":11}},{"id":"69ce3afa-efa0-4229-807e-2f2649018005","block_type":"box","text":"days only (i) for any period during which trading on the NYSE is restricted as determined by the Commission or during","page_number":162,"box":{"x":69,"y":656,"width":835,"height":12}},{"id":"56473dfb-3d60-4f22-bcfb-6761f78acda5","block_type":"box","text":"which the NYSE is closed (other than customary weekend and holiday closings), (ii) for any period during which an","page_number":162,"box":{"x":68,"y":671,"width":811,"height":12}},{"id":"e3e57510-234c-4afa-815f-2f293e5d094d","block_type":"box","text":"emergency exists, as defined by the Commission, as a result of which disposal of por tfolio securities or","page_number":162,"box":{"x":69,"y":686,"width":741,"height":12}},{"id":"0d33913f-3638-460c-b61e-1dfefbddf215","block_type":"box","text":"determination of the NAV of a Fund is not reasonably practicable, or (iii) for such other periods as the Commission","page_number":162,"box":{"x":69,"y":702,"width":813,"height":11}},{"id":"2b10d7c9-3049-46b8-8e57-c8d6c62364e3","block_type":"box","text":"may by order permit for the protection of shareholders of the Fund. (A Fund may also suspend or postpone the","page_number":162,"box":{"x":69,"y":717,"width":787,"height":11}},{"id":"f9cbaba4-2ca8-463f-9e5f-35311c56714a","block_type":"box","text":"recordation of the transfer of its shares upon the occurrence of any of the foregoing conditions.)","page_number":162,"box":{"x":69,"y":732,"width":685,"height":11}},{"id":"78e3097d-02f6-44a7-8957-2bcda62ffc63","block_type":"box","text":"Each Fund, with other investment companies advised by the Manager, has entered into a joint committed line of","page_number":162,"box":{"x":102,"y":755,"width":798,"height":11}},{"id":"00c9d1b8-5311-48e4-be04-fc72d8bb10f8","block_type":"box","text":"credit with a syndicate of banks that is intended to provide the Fund with a temporary source of cash to be used to","page_number":162,"box":{"x":69,"y":770,"width":820,"height":11}},{"id":"8a2c88a5-ead3-4b41-87d8-405425adec3c","block_type":"box","text":"meet redemption requests from shareholders in extraordinary or emergency circumstances.","page_number":162,"box":{"x":69,"y":785,"width":653,"height":11}},{"id":"eee61975-c22a-434c-89e2-7e9516d86b70","block_type":"box","text":"Each Fund may redeem shares involuntarily to reimburse the Fund for any loss sustained by reason of the failure","page_number":162,"box":{"x":102,"y":807,"width":803,"height":12}},{"id":"24bc2776-36cd-4857-ae83-9944b8475b0b","block_type":"box","text":"of a shareholder to make full payment for shares purchased by the shareholder or to collect any charge relating to a","page_number":162,"box":{"x":69,"y":823,"width":827,"height":11}},{"id":"0c627046-7e77-45e6-9315-013a81f7296a","block_type":"box","text":"transaction effected for the benefit of a shareholder. Each Fund reserves the express right to redeem shares of the","page_number":162,"box":{"x":68,"y":838,"width":824,"height":11}},{"id":"edea5a5c-00af-458d-83da-fd3e33131e24","block_type":"box","text":"Fund involuntarily at any time if the Fund’s Board of Directors determines, in its sole discretion, that failure to do so","page_number":162,"box":{"x":70,"y":853,"width":825,"height":11}},{"id":"a2530af8-e276-4373-b522-41b2db04b1f8","block_type":"box","text":"may have adverse consequences to the holders of shares in the Fund. Upon such redemption the holders of shares","page_number":162,"box":{"x":69,"y":868,"width":825,"height":11}},{"id":"ed21828f-9dc0-46ad-9b31-867aecbee5df","block_type":"box","text":"so redeemed shall have no fur ther right with respect thereto other than to receive payment of the redemption price.","page_number":162,"box":{"x":69,"y":883,"width":823,"height":11}},{"id":"da7bc1ca-0089-46cb-9e7c-a6143e81ca81","block_type":"box","text":"II-115","page_number":162,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"67deac6d-224a-4585-8c53-4651de62c666","block_type":"box","text":"NM1026U-6033063-162/246","page_number":162,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"18346d8f-2760-46d2-9f82-ce280c52cec8","block_type":"box","text":"Redemption","page_number":163,"box":{"x":69,"y":45,"width":86,"height":11}},{"id":"32b5610d-85bb-4548-a9c6-4f416efae30b","block_type":"box","text":"Investor A, Investor A1, Investor C, Institutional and Class R Shares","page_number":163,"box":{"x":70,"y":67,"width":481,"height":11}},{"id":"81aaa5a2-3419-4a1c-a52d-bdf0b8d5ed61","block_type":"box","text":"Redeem by Telephone:","page_number":163,"box":{"x":102,"y":90,"width":162,"height":11}},{"id":"80c39cd1-c482-46c1-9ecf-bdd6b27ad1f3","block_type":"box","text":"You may sell Investor Shares, excluding Investor P Shares, held at BlackRock by","page_number":163,"box":{"x":270,"y":90,"width":571,"height":11}},{"id":"b652a413-5a6c-41a9-8ca5-b14533c6a9a0","block_type":"box","text":"telephone request if cer tain conditions are met and if the amount being sold is less than (i) $100,000 for payments","page_number":163,"box":{"x":68,"y":104,"width":829,"height":12}},{"id":"fcc813c4-c5e5-4a20-aa45-fef2bf86167a","block_type":"box","text":"by check or (ii) $250,000 for payments through the Automated Clearing House Network (“ACH”) or wire transfer.","page_number":163,"box":{"x":69,"y":120,"width":798,"height":12}},{"id":"f1b10552-b9f6-48ac-8ed0-edb52f4c8cab","block_type":"box","text":"Cer tain redemption requests, such as those in excess of these amounts, and those where (i) the Fund does not have","page_number":163,"box":{"x":69,"y":135,"width":838,"height":11}},{"id":"ac961a5e-98fe-481c-8d60-a49cb365f7de","block_type":"box","text":"verified banking information on file; or (ii) the proceeds are not paid to the record owner at the record address, must","page_number":163,"box":{"x":68,"y":150,"width":831,"height":12}},{"id":"f7e917e4-41ac-4237-a78e-84f5116fcd81","block_type":"box","text":"be in writing with a medallion signature guarantee provided by any “eligible guarantor institution” as defined in Rule","page_number":163,"box":{"x":69,"y":166,"width":822,"height":11}},{"id":"e8fd2682-e878-4cdf-a94c-21585f779498","block_type":"box","text":"17Ad-15 under the Securities Exchange Act of 1934 (the “Exchange Act”), whose existence and validity may be","page_number":163,"box":{"x":70,"y":181,"width":791,"height":11}},{"id":"03c1ef9a-7539-46f9-9355-6e914f7837e4","block_type":"box","text":"verified by the Transfer Agent through the use of industry publications. For Institutional Shares, cer tain redemption","page_number":163,"box":{"x":68,"y":196,"width":818,"height":11}},{"id":"c9b73c76-e39f-4d67-8107-0157a81ff902","block_type":"box","text":"requests may require written instructions with a medallion signature guarantee. Call (800) 441-7762 for details. You","page_number":163,"box":{"x":69,"y":211,"width":829,"height":11}},{"id":"d241de6a-365a-4242-b324-b98f9ec85820","block_type":"box","text":"can obtain a medallion signature guarantee stamp from a bank, securities dealer, securities broker, credit union,","page_number":163,"box":{"x":69,"y":226,"width":803,"height":11}},{"id":"84720eb6-6ef3-45c2-b702-f1da8846d58e","block_type":"box","text":"savings and loan association, national securities exchange or registered securities association. The three recognized","page_number":163,"box":{"x":69,"y":241,"width":834,"height":11}},{"id":"efc6b14c-c02f-47c7-8d0e-fa2c4e60b50d","block_type":"box","text":"medallion programs are Securities Transfer Agent Medallion Program, Stock Exchanges Medallion Program and New","page_number":163,"box":{"x":69,"y":256,"width":825,"height":12}},{"id":"9aff29d0-b2c1-41d1-92b8-6aaf056f6e95","block_type":"box","text":"York Stock Exchange, Inc. Medallion Signature Program. Signature guarantees which are not a par t of these programs","page_number":163,"box":{"x":68,"y":271,"width":840,"height":12}},{"id":"b0bc8807-cc01-4818-87c4-82b78c7462b5","block_type":"box","text":"will not be accepted. A notary public seal will not be acceptable. Generally, a properly signed written request with any","page_number":163,"box":{"x":68,"y":287,"width":835,"height":11}},{"id":"22af94cf-107c-4f1e-99bd-bab05590280e","block_type":"box","text":"required signature guarantee is all that is required for a redemption. In some cases, however, other documents may","page_number":163,"box":{"x":69,"y":302,"width":828,"height":11}},{"id":"a6f8704e-2a3c-4344-a960-846b5b76d63d","block_type":"box","text":"be necessary. Additional documentary evidence of authority is required by the Transfer Agent in the event redemption","page_number":163,"box":{"x":69,"y":317,"width":835,"height":11}},{"id":"a03147d4-3e36-4812-bb19-259ddeb31cdc","block_type":"box","text":"is requested by a corporation, par tnership, trust, fiduciary, executor or administrator.","page_number":163,"box":{"x":70,"y":332,"width":603,"height":11}},{"id":"67b5a665-ddc6-46c4-bea9-374db0cdc3d1","block_type":"box","text":"If you make a redemption request before a Fund has collected payment for the purchase of shares, the Fund","page_number":163,"box":{"x":102,"y":355,"width":774,"height":11}},{"id":"8625abb0-fc0f-4c15-be2c-de1e3c370a71","block_type":"box","text":"may delay mailing your proceeds. This delay will usually not exceed ten days. A Fund, its Administrators and the","page_number":163,"box":{"x":69,"y":370,"width":795,"height":11}},{"id":"ab97dbd6-659a-46e5-9352-5a8e0429a5a8","block_type":"box","text":"Distributor will employ reasonable procedures to confirm that instructions communicated by telephone are genuine.","page_number":163,"box":{"x":70,"y":385,"width":821,"height":11}},{"id":"26df7f79-6d38-4e54-8af6-586eca6495be","block_type":"box","text":"Telephone redemption requests will not be honored if: (i) the accountholder is deceased, (ii) the proceeds are to be","page_number":163,"box":{"x":68,"y":400,"width":823,"height":11}},{"id":"45fabb8f-7472-4ce8-9842-7803e06aa622","block_type":"box","text":"sent to someone other than the shareholder of record, (iii) a Fund does not have verified information on file, (iv) the","page_number":163,"box":{"x":69,"y":415,"width":823,"height":11}},{"id":"0895e013-42b0-4155-93f1-aeb46839d054","block_type":"box","text":"request is by an individual other than the accountholder of record, (v) the account is held by joint tenants who are","page_number":163,"box":{"x":69,"y":430,"width":809,"height":11}},{"id":"e0bd7f46-8c13-4aa7-a648-121c251c02ad","block_type":"box","text":"divorced, (vi) the address on the account has changed within the last 30 days or share cer tificates have been issued","page_number":163,"box":{"x":69,"y":445,"width":833,"height":12}},{"id":"38d2a088-5fda-4ecd-8f30-aafc29f14c1e","block_type":"box","text":"on the account, or (vii) to protect against fraud, if the caller is unable to provide the account number, the name and","page_number":163,"box":{"x":69,"y":460,"width":821,"height":12}},{"id":"403edb27-8cd0-4541-b829-4ee9b57dd593","block_type":"box","text":"address registered on the account and the social security number registered on the account. The Fund and its","page_number":163,"box":{"x":69,"y":476,"width":785,"height":11}},{"id":"b8c3c623-b2ee-425a-bffd-8f6bb371f630","block_type":"box","text":"service providers will not be liable for any loss, liability, cost or expense for acting upon telephone instructions that","page_number":163,"box":{"x":69,"y":491,"width":820,"height":11}},{"id":"19de3570-6fae-4d37-8a40-3cce3f7c2a4c","block_type":"box","text":"are reasonably believed to be genuine in accordance with such procedures. Before telephone requests will be","page_number":163,"box":{"x":69,"y":506,"width":782,"height":11}},{"id":"29a70373-c8af-4cc5-8832-3339d35d5612","block_type":"box","text":"honored, signature approval from all shareholders of record on the account must be obtained. The Fund may refuse a","page_number":163,"box":{"x":69,"y":521,"width":838,"height":11}},{"id":"6d65f289-6860-4d5b-b9fd-6361fc2e4a9a","block_type":"box","text":"telephone redemption request if it believes it is advisable to do so. During periods of substantial economic or market","page_number":163,"box":{"x":68,"y":536,"width":837,"height":11}},{"id":"5768d57b-9231-448d-a3be-aa76e43479cb","block_type":"box","text":"change, telephone redemptions may be difficult to complete. Please find below alternative redemption methods.","page_number":163,"box":{"x":69,"y":551,"width":800,"height":11}},{"id":"e866cc7e-e8e6-4399-96d5-d99b98d43bb6","block_type":"box","text":"Redemption orders for Institutional Shares placed prior to 4:00 p.m. (Eastern time) on a business day will be","page_number":163,"box":{"x":102,"y":574,"width":776,"height":11}},{"id":"351d139b-5a47-4379-8e8b-2524fd973cdf","block_type":"box","text":"priced at the NAV determined that day. If redemption orders are received by 4:00 p.m. (Eastern time) on a business","page_number":163,"box":{"x":70,"y":589,"width":823,"height":11}},{"id":"14bc4f8b-3971-44ca-988e-4235a9c21017","block_type":"box","text":"day, payment for redeemed Institutional Shares will normally be wired in Federal Funds on the next business day. If","page_number":163,"box":{"x":69,"y":604,"width":820,"height":11}},{"id":"6fdbba0e-d77a-42c3-8193-aa99ae5d9562","block_type":"box","text":"the Federal Reserve Bank of Philadelphia is not open on the business day following receipt of the redemption order,","page_number":163,"box":{"x":68,"y":619,"width":826,"height":11}},{"id":"dfaca10b-b34f-43d1-ae7c-b1a5afea1a03","block_type":"box","text":"the redemption order will be accepted and processed the next succeeding business day when the Federal Reserve","page_number":163,"box":{"x":68,"y":634,"width":817,"height":12}},{"id":"7d724172-f097-4592-8e4d-2bc0872f7882","block_type":"box","text":"Bank of Philadelphia is open, provided that the Fund’s custodian is also open for business.","page_number":163,"box":{"x":70,"y":649,"width":648,"height":11}},{"id":"523e6866-c4fa-4167-b0aa-a93b1bec5cab","block_type":"box","text":"Redeem by VRU:","page_number":163,"box":{"x":102,"y":672,"width":120,"height":11}},{"id":"71c277a0-90a9-41cb-8d6a-61a90859c059","block_type":"box","text":"Investor class shares, excluding Investor P Shares, may also be redeemed by use of a Fund’s","page_number":163,"box":{"x":229,"y":672,"width":667,"height":11}},{"id":"48ef0ae3-bf03-41a4-9455-6abef98c3d30","block_type":"box","text":"automated voice response unit service (“VRU”). Payment for Investor class shares redeemed by VRU may be made","page_number":163,"box":{"x":69,"y":687,"width":820,"height":11}},{"id":"725482b9-8f3b-4699-85dc-24f3f3209b49","block_type":"box","text":"for non-retirement accounts in amounts up to $25,000, either through check, ACH or wire.","page_number":163,"box":{"x":68,"y":702,"width":644,"height":12}},{"id":"cae17386-e441-4b87-a237-cafff367e0fa","block_type":"box","text":"Redeem by Internet:","page_number":163,"box":{"x":102,"y":725,"width":147,"height":11}},{"id":"174ea065-6ee8-44ad-87af-84ef6776a793","block_type":"box","text":"Cer tain Investor and Institutional class shares may also be redeemed by logging onto the","page_number":163,"box":{"x":255,"y":725,"width":637,"height":11}},{"id":"480c13a1-66d0-4c07-b250-05a9dd12c961","block_type":"box","text":"BlackRock website at www.blackrock.com. Proceeds from Internet redemptions may be sent via check, ACH or wire to","page_number":163,"box":{"x":70,"y":740,"width":836,"height":11}},{"id":"ba20375b-aa01-4391-a91d-a6f3ddf54897","block_type":"box","text":"the bank account of record. Payment for shares redeemed by Internet may be made for non-retirement accounts up","page_number":163,"box":{"x":68,"y":755,"width":823,"height":11}},{"id":"518a9e3c-b69f-417a-8348-9112ca52f324","block_type":"box","text":"to $100,000 per account per day, either through check, ACH or wire. Different maximums may apply to cer tain","page_number":163,"box":{"x":68,"y":770,"width":789,"height":12}},{"id":"c8eca972-fceb-4e64-81bb-552d945c4f61","block_type":"box","text":"institutional investors.","page_number":163,"box":{"x":70,"y":786,"width":155,"height":8}},{"id":"351dc93c-9074-481d-9146-1e6aaac02aa9","block_type":"box","text":"Redeem in Writing:","page_number":163,"box":{"x":102,"y":808,"width":137,"height":11}},{"id":"6962fd35-3fad-4576-94f7-87d22b7f8422","block_type":"box","text":"If you hold shares with the Transfer Agent you may redeem such shares without charge by","page_number":163,"box":{"x":247,"y":808,"width":639,"height":11}},{"id":"0b551bc4-a87c-48a1-9e7c-e26414ea9aa9","block_type":"box","text":"writing to BlackRock, P.O. Box 534429, Pittsburgh, Pennsylvania 15253-4429. Redemption requests delivered other","page_number":163,"box":{"x":68,"y":823,"width":831,"height":12}},{"id":"31960f68-b117-4ed3-abbf-9da38c320ed5","block_type":"box","text":"than by mail should be sent to BlackRock, Attention: 534429, 1350 Penn Avenue Suite 102, Pittsburgh,","page_number":163,"box":{"x":68,"y":838,"width":745,"height":12}},{"id":"6bf70cd9-d7eb-4ab9-8b95-ff9bacd37923","block_type":"box","text":"Pennsylvania 15222. If you hold share cer tificates issued by your Fund, the letter must be accompanied by","page_number":163,"box":{"x":69,"y":853,"width":764,"height":12}},{"id":"db7b5c25-82cd-4014-89c1-1b6e0e80978c","block_type":"box","text":"cer tificates for the shares. All shareholders on the account must sign the letter. A medallion signature guarantee will","page_number":163,"box":{"x":69,"y":869,"width":831,"height":11}},{"id":"1a733f25-304b-456c-b447-49bced833798","block_type":"box","text":"generally be required but may be waived in cer tain limited circumstances. You can obtain a medallion signature","page_number":163,"box":{"x":68,"y":884,"width":794,"height":11}},{"id":"95e66599-91c1-4920-9379-59ad88a3ad18","block_type":"box","text":"guarantee stamp from a bank, securities dealer, securities broker, credit union, savings and loan association,","page_number":163,"box":{"x":68,"y":899,"width":782,"height":11}},{"id":"936c8799-720d-485c-b58b-425b0691665c","block_type":"box","text":"II-116","page_number":163,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"29493741-a800-4b64-9963-586de1ae05a7","block_type":"box","text":"NM1026U-6033063-163/246","page_number":163,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"c79c21ea-c8ca-45ff-b569-684d541f950d","block_type":"box","text":"national securities exchange or registered securities association. A notary public seal will not be acceptable. If you","page_number":164,"box":{"x":69,"y":45,"width":817,"height":11}},{"id":"407b96ab-1c65-4efd-a7b4-29aa661a59ef","block_type":"box","text":"hold stock cer tificates, return the cer tificates with the letter. Proceeds from redemptions may be sent via check, ACH","page_number":164,"box":{"x":69,"y":60,"width":836,"height":11}},{"id":"f57d40fb-1b0f-4ff0-87c5-4789a484011b","block_type":"box","text":"or wire to the bank account of record.","page_number":164,"box":{"x":69,"y":75,"width":266,"height":9}},{"id":"a287d3f2-7911-4979-8488-6b1a16eed8c1","block_type":"box","text":"Redemptions of Investor P Shares, Service Shares, Class G Shares, Class K Shares and BlackRock Shares may","page_number":164,"box":{"x":102,"y":98,"width":802,"height":11}},{"id":"bab2da35-9b5b-4d18-9721-32412714cad2","block_type":"box","text":"be made in the manner and amounts described in the Prospectuses.","page_number":164,"box":{"x":69,"y":113,"width":489,"height":11}},{"id":"556b231f-67c4-461a-9cb8-e62559c5fe0c","block_type":"box","text":"The Funds or the Transfer Agent may temporarily suspend telephone transactions at any time.","page_number":164,"box":{"x":101,"y":135,"width":668,"height":12}},{"id":"afe17a88-2356-40ec-bbdb-09271ee7f255","block_type":"box","text":"If you redeem shares directly with the Transfer Agent, payments will generally be mailed within one business day","page_number":164,"box":{"x":102,"y":158,"width":800,"height":11}},{"id":"c02f1249-1c34-4e6b-be48-e5b289e972ab","block_type":"box","text":"of receipt of the proper notice of redemption. A Fund may delay the mailing of a redemption check until good payment","page_number":164,"box":{"x":69,"y":173,"width":838,"height":11}},{"id":"16e46ec5-504e-4412-8bfa-0aac8e809c9b","block_type":"box","text":"(that is, cash, Federal funds or cer tified check drawn on a U.S. bank) has been collected for the purchase of Fund","page_number":164,"box":{"x":69,"y":188,"width":811,"height":11}},{"id":"4ae52b02-2f37-4a57-a3f1-19475c8521d3","block_type":"box","text":"shares, which delay will usually not exceed 10 days. If your account is held directly with the Transfer Agent and","page_number":164,"box":{"x":69,"y":203,"width":789,"height":12}},{"id":"cef9c42f-d552-42a8-94f7-0536b7ff8f03","block_type":"box","text":"contains a fractional share balance following a redemption, the fractional share balance will be automatically","page_number":164,"box":{"x":69,"y":218,"width":775,"height":12}},{"id":"ee711fa8-8567-44e7-880e-fb5d1332b854","block_type":"box","text":"redeemed by the Fund.","page_number":164,"box":{"x":69,"y":234,"width":162,"height":11}},{"id":"3c279216-6f26-4388-a5e4-8e956cab39d5","block_type":"box","text":"Note on Low Balance Accounts.","page_number":164,"box":{"x":102,"y":257,"width":223,"height":8}},{"id":"6b7b434f-0dd3-49e7-8f89-d25049870ed7","block_type":"box","text":"Because of the high cost of maintaining smaller shareholder accounts,","page_number":164,"box":{"x":332,"y":256,"width":503,"height":12}},{"id":"30905cae-acc2-497a-aa44-6c20da8d8408","block_type":"box","text":"BlackRock has set a minimum balance of $500 in each Fund position you hold within your account (“Fund","page_number":164,"box":{"x":70,"y":271,"width":752,"height":12}},{"id":"741d4db0-e7e3-44a8-95c5-49f8f9aed2ff","block_type":"box","text":"Minimum”), and may redeem the shares in your account if the NAV of those shares in your account falls below $500","page_number":164,"box":{"x":70,"y":286,"width":829,"height":12}},{"id":"6e730d9f-8ecf-405a-b089-34dd1f2dfeb2","block_type":"box","text":"for any reason, including market fluctuation.","page_number":164,"box":{"x":68,"y":302,"width":313,"height":11}},{"id":"b46315b4-4bf1-42fa-843d-84e8c570c111","block_type":"box","text":"You will be notified that the value of your account is less than the Fund Minimum before the Fund makes any","page_number":164,"box":{"x":101,"y":324,"width":775,"height":11}},{"id":"3a601534-ac70-4157-95d7-865513425bbf","block_type":"box","text":"involuntary redemption. This notification will provide you with a 90 calendar day period to make an additional","page_number":164,"box":{"x":70,"y":339,"width":773,"height":12}},{"id":"0f40e1f3-c0f9-4451-8cbd-d4ac64410fe4","block_type":"box","text":"investment in order to bring the value of your account to at least $500 before the Fund makes an involuntary","page_number":164,"box":{"x":70,"y":354,"width":776,"height":12}},{"id":"3831da04-4ec6-468c-ae3f-079feb9a3d0e","block_type":"box","text":"redemption. This involuntary redemption will not charge any deferred sales charge, and may not apply to accounts of","page_number":164,"box":{"x":69,"y":370,"width":834,"height":11}},{"id":"cd7f157b-947a-4fd4-8e6c-1a7c79df37b1","block_type":"box","text":"cer tain employer-sponsored retirement plans (not including IRAs), qualified state tuition plan (529 Plan) accounts,","page_number":164,"box":{"x":69,"y":385,"width":811,"height":11}},{"id":"42173bc5-6af5-4230-961f-8a7c73636ac8","block_type":"box","text":"and select fee-based programs at your financial intermediary.","page_number":164,"box":{"x":69,"y":400,"width":435,"height":11}},{"id":"a9299aa2-33a3-43b3-aa4d-ca948c7fd0c7","block_type":"box","text":"Repurchase","page_number":164,"box":{"x":69,"y":430,"width":85,"height":11}},{"id":"16f3df3a-0d91-4651-a452-d83d8dae2632","block_type":"box","text":"A Fund normally will accept orders to repurchase shares from Selling Dealers for their customers. Shares will be","page_number":164,"box":{"x":101,"y":453,"width":800,"height":11}},{"id":"a701208b-e9ad-4c85-b69c-4ada65cb7982","block_type":"box","text":"priced at the NAV of the Fund next determined after receipt of the repurchase order by a Selling Dealer that has been","page_number":164,"box":{"x":70,"y":468,"width":833,"height":11}},{"id":"719a8c3c-31d9-43da-9da8-6317072091bc","block_type":"box","text":"authorized by the Distributor by contract to accept such orders. As to repurchase orders received by Selling Dealers","page_number":164,"box":{"x":69,"y":483,"width":822,"height":11}},{"id":"7de6a280-428b-4fd1-bbd6-75156ecd3fda","block_type":"box","text":"prior to the close of business on the NYSE (generally, the NYSE closes at 4:00 p.m. Eastern time), on the day the","page_number":164,"box":{"x":70,"y":498,"width":809,"height":11}},{"id":"d93e393e-ff0c-472b-a797-306b42df970e","block_type":"box","text":"order is placed, which includes orders received after the close of business on the previous day, the repurchase price","page_number":164,"box":{"x":69,"y":513,"width":831,"height":11}},{"id":"16aef2fb-33ec-4c85-9388-942553d00ef6","block_type":"box","text":"is the NAV determined as of the close of business on the NYSE on that day. If the orders for repurchase are not","page_number":164,"box":{"x":70,"y":528,"width":796,"height":12}},{"id":"26bb08d3-8c04-432f-8aad-e5442e8dd1b4","block_type":"box","text":"received by the Selling Dealer before the close of business on the NYSE, such orders are deemed received on the","page_number":164,"box":{"x":69,"y":543,"width":812,"height":12}},{"id":"e0753ffe-40fe-4a14-a173-608a9626b1c7","block_type":"box","text":"next business day.","page_number":164,"box":{"x":69,"y":559,"width":130,"height":11}},{"id":"738d7d0c-f3cd-41ec-956e-ba0862835232","block_type":"box","text":"These repurchase arrangements are for your convenience and do not involve a charge by the Fund (other than","page_number":164,"box":{"x":101,"y":581,"width":783,"height":12}},{"id":"7b568f62-040c-4cae-9b2d-75bb2a1d688d","block_type":"box","text":"any applicable CDSC or redemption fee). However, Selling Dealers may charge a processing fee in connection with","page_number":164,"box":{"x":69,"y":596,"width":813,"height":12}},{"id":"384a34f9-971a-4df6-bf0c-9ddac36e3303","block_type":"box","text":"such transactions. In addition, securities firms that do not have selected dealer agreements with the Distributor may","page_number":164,"box":{"x":69,"y":612,"width":832,"height":11}},{"id":"b45fe88c-374d-4cd2-aeb3-c422b77b9e7e","block_type":"box","text":"impose a transaction charge for transmitting the notice of repurchase to the Fund. Each Fund reserves the right to","page_number":164,"box":{"x":70,"y":627,"width":814,"height":11}},{"id":"7bda452e-7920-4763-b6b9-f3d8f251f1b4","block_type":"box","text":"reject any order for repurchase. A shareholder whose order for repurchase is rejected by a Fund, however, may","page_number":164,"box":{"x":69,"y":642,"width":788,"height":11}},{"id":"941abf91-2b76-4d69-aba0-408f4dffa08f","block_type":"box","text":"redeem shares as set out above.","page_number":164,"box":{"x":69,"y":657,"width":235,"height":9}},{"id":"3c18ec3e-b3ed-486e-83db-dbb647782ba3","block_type":"box","text":"Reinstatement Privilege — Investor A and Investor P Shares","page_number":164,"box":{"x":69,"y":687,"width":440,"height":11}},{"id":"c3b7df81-cee9-463f-b2d8-fa8900e0fde1","block_type":"box","text":"Upon redemption of Investor A, Investor A1, Investor P or Institutional Shares, as applicable, shareholders may","page_number":164,"box":{"x":102,"y":710,"width":791,"height":11}},{"id":"0e8dfe1b-3386-4259-a0f7-2b9ed5b37adf","block_type":"box","text":"reinvest all or a por tion of their redemption proceeds (after paying any applicable CDSC) in Investor A or Investor P","page_number":164,"box":{"x":69,"y":725,"width":815,"height":11}},{"id":"3000ffda-cf0c-4f5e-9310-1ec86731937b","block_type":"box","text":"Shares of the same or another BlackRock fund without paying a front-end sales charge. This right may be exercised","page_number":164,"box":{"x":69,"y":740,"width":822,"height":11}},{"id":"8bc5c8e1-d1e8-4dda-80af-d171ad343f8a","block_type":"box","text":"within 90 days of the redemption, provided that the Investor A or Investor P Shares, as applicable, of that fund is","page_number":164,"box":{"x":68,"y":755,"width":806,"height":11}},{"id":"7dd48cc5-54ac-48c2-a24d-2dbe528f5668","block_type":"box","text":"currently open to new investors or the shareholder has a current account in that closed fund. Shares will be","page_number":164,"box":{"x":69,"y":770,"width":768,"height":11}},{"id":"ef2c151c-81f4-490b-919e-9d055307bec0","block_type":"box","text":"purchased at the NAV calculated at the close of trading on the day the request is received in good order. To exercise","page_number":164,"box":{"x":70,"y":785,"width":827,"height":12}},{"id":"0c08b8a7-e14c-407b-a065-a7b10456c845","block_type":"box","text":"this privilege, the Transfer Agent must receive written notification from the shareholder of record or the registered","page_number":164,"box":{"x":68,"y":801,"width":809,"height":11}},{"id":"5276e7ea-4667-43ab-854a-187911b00422","block_type":"box","text":"representative of record, at the time of purchase. Investors should consult a tax advisor concerning the tax","page_number":164,"box":{"x":69,"y":816,"width":764,"height":11}},{"id":"b7f22ef1-718b-4cfd-911e-556c0a2a64ee","block_type":"box","text":"consequences of exercising this reinstatement privilege.","page_number":164,"box":{"x":69,"y":831,"width":400,"height":11}},{"id":"c24bcf25-6025-4134-a910-2ce6506e3a7e","block_type":"box","text":"II-117","page_number":164,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"e3a2576b-2014-4dfc-b286-c084e9a147e6","block_type":"box","text":"NM1026U-6033063-164/246","page_number":164,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"bb5293da-dbcb-4220-a62d-2f9e4c47c07f","block_type":"box","text":"SHAREHOLDER SERVICES","page_number":165,"box":{"x":384,"y":45,"width":210,"height":10}},{"id":"cf13fd23-fcc3-43dc-883a-7eddd00d3121","block_type":"box","text":"Each Fund offers one or more of the shareholder services described below that are designed to facilitate","page_number":165,"box":{"x":102,"y":68,"width":747,"height":11}},{"id":"ed477514-5bd1-4d77-9833-76bfae7e9549","block_type":"box","text":"investment in its shares. You can obtain more information about these services from each Fund by calling the","page_number":165,"box":{"x":70,"y":83,"width":781,"height":11}},{"id":"50b726bc-14a9-490d-9825-0ef88fd59908","block_type":"box","text":"telephone number on the cover page, or from the Distributor, your financial adviser, your selected securities dealer or","page_number":165,"box":{"x":68,"y":98,"width":836,"height":11}},{"id":"8087eac3-9248-4092-90dc-578110554f44","block_type":"box","text":"other financial intermediary. Cer tain of these services are available only to U.S. investors.","page_number":165,"box":{"x":69,"y":113,"width":641,"height":11}},{"id":"8cdbfe15-f685-43dc-b0a8-b9c0976ce2eb","block_type":"box","text":"Investment Account","page_number":165,"box":{"x":69,"y":144,"width":146,"height":9}},{"id":"ae015114-0c10-4d93-8bc6-a679bc09a73e","block_type":"box","text":"If your account is maintained at the Transfer Agent (an “Investment Account”) you will receive statements, at","page_number":165,"box":{"x":102,"y":166,"width":774,"height":11}},{"id":"d3e213db-9241-4e9f-95a9-5cfa216c3ca7","block_type":"box","text":"least quar terly, from the Transfer Agent. These statements will serve as confirmations for automatic investment","page_number":165,"box":{"x":70,"y":181,"width":796,"height":12}},{"id":"f620b834-84ea-49bb-9fbf-9b1e9a313f79","block_type":"box","text":"purchases and the reinvestment of dividends. The statements also will show any other activity in your Investment","page_number":165,"box":{"x":70,"y":196,"width":807,"height":12}},{"id":"296ff618-e94b-4269-8144-da85316cfc20","block_type":"box","text":"Account since the last statement. You also will receive separate confirmations for each purchase or sale transaction","page_number":165,"box":{"x":68,"y":212,"width":830,"height":11}},{"id":"b6cc5e5d-c1ff-4f4e-9308-599a93a4ea8e","block_type":"box","text":"other than automatic investment purchases and the reinvestment of dividends. If your Investment Account is held at","page_number":165,"box":{"x":69,"y":227,"width":829,"height":11}},{"id":"4b2ef8a9-b7bd-42b7-bbd5-09ac0402fe3e","block_type":"box","text":"the Transfer Agent you may make additions to it at any time by mailing a check directly to the Transfer Agent. Each","page_number":165,"box":{"x":68,"y":242,"width":815,"height":11}},{"id":"56c0d7b0-9bd2-47aa-a8ed-2bb34ab9deeb","block_type":"box","text":"Fund limits purchases by personal check to $500,000 per trade. You may also maintain an account through a","page_number":165,"box":{"x":70,"y":256,"width":781,"height":12}},{"id":"e97d127d-a179-4518-bb84-77fb6e1c1b26","block_type":"box","text":"selected securities dealer or other financial intermediary. If you transfer shares out of an account maintained with a","page_number":165,"box":{"x":69,"y":272,"width":825,"height":11}},{"id":"f64196bb-0b30-4fc8-8032-0522e8adfa47","block_type":"box","text":"selected securities dealer or other financial intermediary, an Investment Account in your name may be opened","page_number":165,"box":{"x":69,"y":287,"width":785,"height":11}},{"id":"03021972-66a2-4b09-b4a3-501f3d08630b","block_type":"box","text":"automatically at the Transfer Agent.","page_number":165,"box":{"x":69,"y":302,"width":251,"height":12}},{"id":"82f9a9c7-fc84-4f22-aea8-e87c6ceba710","block_type":"box","text":"You may transfer Fund shares from a selected securities dealer or other financial intermediary to another","page_number":165,"box":{"x":101,"y":325,"width":750,"height":11}},{"id":"2485e8cf-54dc-404a-a05a-9582d2a2b58d","block_type":"box","text":"securities dealer or other financial intermediary that has entered into an agreement with the Distributor. Cer tain","page_number":165,"box":{"x":69,"y":340,"width":797,"height":11}},{"id":"f57c58ff-b134-46a7-942e-f702815a4342","block_type":"box","text":"shareholder services may not be available for the transferred shares. All future trading of these assets must be","page_number":165,"box":{"x":69,"y":355,"width":797,"height":11}},{"id":"bcdf55a2-60c3-4531-8c25-cf87f243efbd","block_type":"box","text":"coordinated by the new firm. If you wish to transfer your shares to a securities dealer or other financial intermediary","page_number":165,"box":{"x":69,"y":370,"width":826,"height":11}},{"id":"686d70a1-8042-42cc-a802-2eb55a89f746","block_type":"box","text":"that has not entered into an agreement with the Distributor, you must either (i) redeem your shares, paying any","page_number":165,"box":{"x":68,"y":386,"width":792,"height":11}},{"id":"2c66fc24-8260-4970-a7a5-343176073165","block_type":"box","text":"applicable CDSC or (ii) continue to maintain an Investment Account at the Transfer Agent for those shares. You also","page_number":165,"box":{"x":69,"y":401,"width":824,"height":11}},{"id":"e0137fe9-84c6-412d-8ce3-bb8484b15b5b","block_type":"box","text":"may request that the new securities dealer or other financial intermediary maintain the shares in an account at the","page_number":165,"box":{"x":69,"y":416,"width":820,"height":11}},{"id":"0e4dc66b-4ac1-4de3-9f15-270217e739ea","block_type":"box","text":"Transfer Agent registered in the name of the securities dealer or other financial intermediary for your benefit whether","page_number":165,"box":{"x":68,"y":431,"width":833,"height":11}},{"id":"c79c0edd-a76d-402d-a505-32d7c94b4fee","block_type":"box","text":"the securities dealer or other financial intermediary has entered into a selected dealer agreement or not. In the","page_number":165,"box":{"x":68,"y":446,"width":795,"height":11}},{"id":"66205663-3962-4052-a97e-135858d95840","block_type":"box","text":"interest of economy and convenience and because of the operating procedures of each Fund, share cer tificates will","page_number":165,"box":{"x":70,"y":461,"width":822,"height":11}},{"id":"ef2913a1-c29e-4a7a-903c-1656b46b764a","block_type":"box","text":"not be issued physically. Shares are maintained by each Fund on its register maintained by the Transfer Agent and","page_number":165,"box":{"x":69,"y":476,"width":814,"height":11}},{"id":"67b2c007-8093-4530-9615-59d12047ec5b","block_type":"box","text":"the holders thereof will have the same rights and ownership with respect to such shares as if cer tificates had been","page_number":165,"box":{"x":68,"y":491,"width":822,"height":12}},{"id":"35a5e042-055a-4f22-9482-98e571ed0193","block_type":"box","text":"issued.","page_number":165,"box":{"x":70,"y":507,"width":49,"height":8}},{"id":"d2735c87-d901-4be0-b550-ac8e88da322e","block_type":"box","text":"If you are considering transferring a tax-deferred retirement account, such as an individual retirement account,","page_number":165,"box":{"x":102,"y":529,"width":785,"height":11}},{"id":"e6196237-676c-4cf0-a6e5-01f6c705459d","block_type":"box","text":"from one selected securities dealer to another securities dealer or other financial intermediary, you should be aware","page_number":165,"box":{"x":68,"y":544,"width":830,"height":11}},{"id":"26a2fabc-f087-4510-ba16-5e9c44373ca0","block_type":"box","text":"that if the new firm will not take delivery of shares of the Fund, you must either redeem the shares (paying any","page_number":165,"box":{"x":68,"y":559,"width":790,"height":12}},{"id":"93e369a3-c880-48cf-a602-1e227fbc714c","block_type":"box","text":"applicable CDSC) so that the cash proceeds can be transferred to the account at the new firm, or you must continue","page_number":165,"box":{"x":69,"y":574,"width":831,"height":12}},{"id":"6971de0b-884f-44a9-93f3-4277913c40ff","block_type":"box","text":"to maintain a retirement account at the original selected securities dealer for those shares.","page_number":165,"box":{"x":68,"y":589,"width":652,"height":12}},{"id":"62f44376-249b-4947-a83a-a91cecb58c26","block_type":"box","text":"Exchange Privilege","page_number":165,"box":{"x":69,"y":620,"width":138,"height":11}},{"id":"15650310-373a-4f77-b376-b123de973f49","block_type":"box","text":"U.S. shareholders of Investor A, Investor A1, Investor C, Investor P, Class K, Institutional and Class G Shares of","page_number":165,"box":{"x":102,"y":642,"width":797,"height":11}},{"id":"09038f14-79b4-4725-94b7-c3df961a7c9d","block_type":"box","text":"each Fund have an exchange privilege with cer tain other Funds. However, Investor A1 Shares may only exchange out.","page_number":165,"box":{"x":69,"y":658,"width":832,"height":11}},{"id":"11f2e026-f20a-48c8-aa96-2804756c7492","block_type":"box","text":"The minimum amount for exchanges of Investor class shares is $1,000, although you may exchange less than","page_number":165,"box":{"x":68,"y":672,"width":788,"height":12}},{"id":"87c2c960-edf3-4b2f-a571-8edd904658c4","block_type":"box","text":"$1,000 if you already have an account in the Fund into which you are exchanging. You may only exchange into a","page_number":165,"box":{"x":69,"y":687,"width":796,"height":12}},{"id":"e033ffc9-833b-4882-95a4-b952c95bb2c9","block_type":"box","text":"share class and a Fund that are open to new investors or in which you have a current account if the class or fund is","page_number":165,"box":{"x":69,"y":703,"width":824,"height":11}},{"id":"1209022f-8b37-46d7-af9e-ce9155dd586a","block_type":"box","text":"closed to new investors. Before effecting an exchange, you should obtain a currently effective prospectus of the fund","page_number":165,"box":{"x":69,"y":718,"width":835,"height":11}},{"id":"e1af8a4a-9d18-4bf6-bd42-108079e4e907","block_type":"box","text":"into which you wish to make the exchange. Exercise of the exchange privilege is treated as a sale of the exchanged","page_number":165,"box":{"x":70,"y":733,"width":820,"height":11}},{"id":"9103eeff-d606-4738-9b94-e43b227ba3f3","block_type":"box","text":"shares and a purchase of the acquired shares for U.S. federal income tax purposes.","page_number":165,"box":{"x":69,"y":748,"width":600,"height":11}},{"id":"6293aa17-8da1-4a27-bc96-08903bf024bf","block_type":"box","text":"Exchanges of Investor A, Investor A1, Investor P, Class K, Institutional and Class G Shares.","page_number":165,"box":{"x":102,"y":771,"width":648,"height":11}},{"id":"4fcd73b4-3255-4848-b87c-cccef20d3592","block_type":"box","text":"Institutional Shares","page_number":165,"box":{"x":757,"y":771,"width":137,"height":9}},{"id":"c6483eae-6b12-4f35-9548-cf9c40b9e99a","block_type":"box","text":"are exchangeable with Institutional Shares of other Funds. Investor A and Investor A1 Shares are exchangeable for","page_number":165,"box":{"x":69,"y":786,"width":817,"height":11}},{"id":"d1e99e05-0a87-464e-bf57-72cb9808ced2","block_type":"box","text":"Investor A Shares of other Funds to the extent such shares are offered by your financial intermediary. Investor P","page_number":165,"box":{"x":70,"y":801,"width":798,"height":11}},{"id":"f4ef13d8-7069-4225-bb40-3632ccde1d77","block_type":"box","text":"Shares are exchangeable for Investor P Shares of other Funds, to the extent such shares are offered by your financial","page_number":165,"box":{"x":69,"y":816,"width":838,"height":12}},{"id":"991f17f1-c531-4f2b-a7d7-3331bb86b004","block_type":"box","text":"intermediary. Class K Shares are exchangeable for Class K Shares of other Funds. Class G Shares are exchangeable","page_number":165,"box":{"x":70,"y":831,"width":834,"height":12}},{"id":"d5d3686c-c237-4a60-b64f-ebf46a8da279","block_type":"box","text":"for Class G Shares of other Funds.","page_number":165,"box":{"x":68,"y":846,"width":246,"height":10}},{"id":"e213d769-c420-4e8c-baa1-57a2431c9e28","block_type":"box","text":"Exchanges of Institutional Shares outstanding for Institutional Shares of a second fund or for shares of a money","page_number":165,"box":{"x":102,"y":869,"width":800,"height":11}},{"id":"d546c594-d76c-40f5-b031-240c7f6b9c03","block_type":"box","text":"market fund are effected on the basis of relative NAV per Institutional Share. Exchanges of Investor A or Investor A1","page_number":165,"box":{"x":69,"y":884,"width":826,"height":12}},{"id":"aaf79a7e-5612-4694-bc67-d261a1681c3a","block_type":"box","text":"Shares outstanding (“outstanding Investor A Shares”) for Investor A Shares of a second fund, or for shares of a","page_number":165,"box":{"x":69,"y":899,"width":795,"height":12}},{"id":"29818ce8-3788-4820-bd86-16150de7ac9d","block_type":"box","text":"II-118","page_number":165,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"8fb6711e-4034-41ae-9f9e-48960d668843","block_type":"box","text":"NM1026U-6033063-165/246","page_number":165,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"e6f9e35f-ee98-4c6e-923f-140df4fc7e77","block_type":"box","text":"money market fund (“new Investor A Shares”) are effected on the basis of relative NAV per share. Exchanges of","page_number":166,"box":{"x":69,"y":45,"width":797,"height":11}},{"id":"57675ce4-a5e9-4ddf-b478-1eafbb7ae5d8","block_type":"box","text":"Investor P Shares outstanding for Investor P Shares of a second fund are effected on the basis of relative NAV per","page_number":166,"box":{"x":70,"y":60,"width":814,"height":11}},{"id":"3630d785-5f6c-4651-9e95-e68d19053f10","block_type":"box","text":"share. Exchanges of Class K Shares outstanding for Class K Shares of a second fund, or for shares of a money","page_number":166,"box":{"x":69,"y":75,"width":796,"height":11}},{"id":"ab1df93b-0e76-407b-bf7b-d24caece7e2f","block_type":"box","text":"market fund are effected on the basis of relative NAV per share. Exchanges of Class G Shares outstanding for Class","page_number":166,"box":{"x":69,"y":90,"width":828,"height":11}},{"id":"38f0d746-705b-47b4-a79f-0b3f4700e7f9","block_type":"box","text":"G Shares of a second fund are effected on the basis of relative NAV per share.","page_number":166,"box":{"x":69,"y":105,"width":561,"height":11}},{"id":"4d8998e5-9df3-4947-8062-cceb79b3f6bc","block_type":"box","text":"Exchanges of Investor C Shares.","page_number":166,"box":{"x":102,"y":128,"width":229,"height":11}},{"id":"7c15c425-df5e-4c12-a97a-a5e47484bb5c","block_type":"box","text":"Shareholders of cer tain Funds with Investor C Shares outstanding (“outstanding","page_number":166,"box":{"x":338,"y":128,"width":570,"height":11}},{"id":"39ee72e2-fda7-49da-a16d-bbf016bc3c70","block_type":"box","text":"Investor C Shares”) may exchange their shares for Investor C Shares of a second Fund (“new Investor C Shares”) or","page_number":166,"box":{"x":70,"y":143,"width":827,"height":11}},{"id":"5e683047-d071-4413-a6eb-a1ff6dadf53c","block_type":"box","text":"for shares of a money market fund (“new money market fund Shares”) on the basis of relative NAV per share, without","page_number":166,"box":{"x":68,"y":158,"width":839,"height":11}},{"id":"814bd89c-9757-4ac1-a712-968a72caff9b","block_type":"box","text":"the payment of any CDSC. Cer tain Funds impose different CDSC schedules. For purposes of computing the CDSC","page_number":166,"box":{"x":68,"y":173,"width":811,"height":11}},{"id":"5ba03c27-e45a-430e-b63b-b8c0e645dce4","block_type":"box","text":"upon redemption of new Investor C Shares or new money market fund Shares, as applicable, the time you held both","page_number":166,"box":{"x":69,"y":188,"width":827,"height":11}},{"id":"c6fcca2e-80af-4c94-b2f5-2096a4c61292","block_type":"box","text":"the exchanged Investor C Shares and the new Investor C Shares or new money market fund Shares will count","page_number":166,"box":{"x":68,"y":203,"width":781,"height":12}},{"id":"76fc20d7-7e1a-4c89-be2b-c8b09da028d5","block_type":"box","text":"towards the holding period of the new Investor C Shares or new money market fund Shares.","page_number":166,"box":{"x":68,"y":218,"width":654,"height":12}},{"id":"9142ed12-eb27-403f-aeae-b09c257f763c","block_type":"box","text":"Exchanges of Service Shares.","page_number":166,"box":{"x":102,"y":241,"width":211,"height":11}},{"id":"30f876f6-badd-4178-adb2-e22212d563e1","block_type":"box","text":"Service Shares can be exchanged for Service Shares of Funds that are covered by","page_number":166,"box":{"x":319,"y":241,"width":588,"height":11}},{"id":"3b1308b4-5436-4000-a328-8a641e6edeab","block_type":"box","text":"selected dealer agreements with the Distributor.","page_number":166,"box":{"x":69,"y":257,"width":342,"height":11}},{"id":"47eafe66-3b69-48ba-b710-ee4d58c827ed","block_type":"box","text":"Exchanges for Shares of a Money Market Fund.","page_number":166,"box":{"x":102,"y":279,"width":335,"height":11}},{"id":"0fa4313e-9abe-4810-9e80-5432b3bbfcb9","block_type":"box","text":"You may exchange any class of Investor class shares, excluding","page_number":166,"box":{"x":443,"y":279,"width":455,"height":11}},{"id":"4758ef7b-a0f1-40c1-84a1-eba49a937b5d","block_type":"box","text":"Investor P Shares, for shares of an affiliated money market fund. If you exchange into BlackRock Summit Cash","page_number":166,"box":{"x":70,"y":294,"width":788,"height":11}},{"id":"66218f9c-9b5d-4ff1-a1e4-02d4715b6293","block_type":"box","text":"Reserves Fund (“Summit”), a series of BlackRock Financial Institutions Series Trust, you will receive one of two","page_number":166,"box":{"x":70,"y":309,"width":793,"height":11}},{"id":"6a2dd4fb-c0ff-497b-ab3c-a467bd8030ba","block_type":"box","text":"classes of shares: exchanges of Investor A, Investor A1 and Institutional Shares of a Fund will receive Investor A","page_number":166,"box":{"x":69,"y":324,"width":802,"height":12}},{"id":"6f3d6979-adfe-4211-905d-c5f3cab76b67","block_type":"box","text":"Shares of Summit and exchanges of Investor C Shares of a Fund will receive Investor C Shares of Summit. You may","page_number":166,"box":{"x":69,"y":339,"width":824,"height":12}},{"id":"f5c9d012-3187-4b80-b369-c129ee810a41","block_type":"box","text":"exchange Investor A Shares of Summit back into Investor A or Institutional Shares of a Fund, if you are eligible to","page_number":166,"box":{"x":69,"y":355,"width":805,"height":11}},{"id":"b68fb065-4e34-4698-a025-1b12fa6c45bd","block_type":"box","text":"hold such shares. You may exchange Investor C Shares of Summit back into Investor C Shares of a Fund and, in the","page_number":166,"box":{"x":69,"y":370,"width":827,"height":11}},{"id":"8291f718-e0a3-42fc-85ec-defd288fc70a","block_type":"box","text":"event of such an exchange, the period of time that you held Investor C Shares of Summit will count toward","page_number":166,"box":{"x":69,"y":385,"width":758,"height":11}},{"id":"a27f1c22-f3f9-4037-851b-12fe97e0a9e9","block_type":"box","text":"satisfaction of the holding period requirement for purposes of reducing any CDSC. Investor C Shares of Summit are","page_number":166,"box":{"x":69,"y":400,"width":822,"height":11}},{"id":"935118a8-b982-4221-9ca7-afb77e6a0112","block_type":"box","text":"subject to a distribution fee at an annual rate of 0.75% of average daily net assets of such Investor C Shares.","page_number":166,"box":{"x":69,"y":415,"width":782,"height":11}},{"id":"68d5bbc3-866c-4ba9-95aa-d3b722fe6bef","block_type":"box","text":"Exchanges of Investor C Shares of a money market fund other than Summit for Investor C Shares of a Fund will be","page_number":166,"box":{"x":70,"y":430,"width":814,"height":11}},{"id":"1ec21277-4500-41c9-9d91-9bd14b5e46d3","block_type":"box","text":"exercised at NAV. However, a CDSC may be charged in connection with any subsequent redemption of the Investor C","page_number":166,"box":{"x":69,"y":445,"width":830,"height":12}},{"id":"48466193-be8e-4eeb-b527-8cfe89c8494e","block_type":"box","text":"Shares of the Fund received in the exchange. In determining the holding period for calculating the CDSC payable on","page_number":166,"box":{"x":69,"y":460,"width":821,"height":12}},{"id":"f5b38ea1-2d7b-464f-8b2a-f9e19be21d4a","block_type":"box","text":"redemption of Investor C Shares of the Fund received in the exchange, the holding period of the money market fund","page_number":166,"box":{"x":69,"y":475,"width":823,"height":12}},{"id":"23d2fbef-7b08-4f25-ab2e-ab7cc83e9f47","block_type":"box","text":"Investor C Shares originally held will be added to the holding period of the Investor C Shares acquired through","page_number":166,"box":{"x":70,"y":491,"width":781,"height":11}},{"id":"ac61e9d2-8c91-400d-bdfb-6715c69dbcc4","block_type":"box","text":"exchange.","page_number":166,"box":{"x":69,"y":506,"width":70,"height":11}},{"id":"f7ec77d7-06f1-46ad-841f-11a595207024","block_type":"box","text":"Exchanges by Par ticipants in Cer tain Programs.","page_number":166,"box":{"x":102,"y":529,"width":337,"height":11}},{"id":"085d7dc9-d872-4331-ae8f-1b8eb1d6f65d","block_type":"box","text":"The exchange privilege may be modified with respect to cer tain","page_number":166,"box":{"x":445,"y":528,"width":448,"height":12}},{"id":"c468203e-0d19-4f4f-a920-0cd7aadb63a0","block_type":"box","text":"par ticipants in mutual fund advisory programs and other fee-based programs sponsored by the Manager, an affiliate","page_number":166,"box":{"x":70,"y":543,"width":828,"height":12}},{"id":"7012428a-52b5-46b0-9564-95b4636f7516","block_type":"box","text":"of the Manager, or selected securities dealers or other financial intermediaries that have an agreement with the","page_number":166,"box":{"x":69,"y":559,"width":796,"height":11}},{"id":"870a8bef-5ee2-48a5-b1fc-15b59cb7e220","block_type":"box","text":"Distributor. See “Fee-Based Programs” below.","page_number":166,"box":{"x":70,"y":574,"width":324,"height":11}},{"id":"25c4653e-49af-4b65-90ff-e096e334b876","block_type":"box","text":"Exercise of the Exchange Privilege.","page_number":166,"box":{"x":102,"y":596,"width":245,"height":12}},{"id":"98f00c77-a859-4445-93ef-e0ef8a8c1953","block_type":"box","text":"To exercise the exchange privilege, you should contact your financial adviser","page_number":166,"box":{"x":353,"y":596,"width":543,"height":12}},{"id":"caae1083-7248-4050-b026-09bde4f2c419","block_type":"box","text":"or the Transfer Agent, who will advise each Fund of the exchange. If you do not hold share cer tificates, you may","page_number":166,"box":{"x":69,"y":612,"width":794,"height":11}},{"id":"7f5a156b-52ca-4f36-ae2f-f93a14105318","block_type":"box","text":"exercise the exchange privilege by wire through your securities dealer or other financial intermediary. Each Fund","page_number":166,"box":{"x":69,"y":627,"width":795,"height":11}},{"id":"86e30eee-52a8-4ca5-9ab4-d495431065ea","block_type":"box","text":"reserves the right to require a properly completed exchange application.","page_number":166,"box":{"x":69,"y":642,"width":512,"height":11}},{"id":"fe16d3cf-5316-4b61-9853-28418a607193","block_type":"box","text":"A shareholder who wishes to make an exchange may do so by sending a written request to the Fund c/o the","page_number":166,"box":{"x":101,"y":665,"width":772,"height":11}},{"id":"998f3e81-a764-40da-b1ef-649c8e0177e9","block_type":"box","text":"Transfer Agent at the following address: P.O. Box 534429, Pittsburgh, Pennsylvania 15253-4429. Shareholders are","page_number":166,"box":{"x":68,"y":680,"width":824,"height":11}},{"id":"c21457c1-184e-4198-8978-a02699712dd3","block_type":"box","text":"automatically provided with telephone exchange privileges when opening an account, unless they indicate on the","page_number":166,"box":{"x":69,"y":695,"width":801,"height":11}},{"id":"2eb13245-e431-43fd-b2df-db6b0ce0fc90","block_type":"box","text":"Application that they do not wish to use this privilege. To add this feature to an existing account that previously did","page_number":166,"box":{"x":68,"y":710,"width":817,"height":11}},{"id":"b90ab0e9-f246-4c2b-8037-de962e26bf60","block_type":"box","text":"not provide this option, a Telephone Exchange Authorization Form must be filed with the Transfer Agent. This form is","page_number":166,"box":{"x":69,"y":725,"width":826,"height":11}},{"id":"e7235e32-b185-4a3d-bdc3-63a8c2df45fa","block_type":"box","text":"available from the Transfer Agent. Once this election has been made, the shareholder may simply contact the Fund by","page_number":166,"box":{"x":69,"y":740,"width":840,"height":11}},{"id":"9818b707-874e-4f1b-9f89-5a15d40f9bb9","block_type":"box","text":"telephone at (800) 441-7762 to request the exchange. During periods of substantial economic or market change,","page_number":166,"box":{"x":68,"y":755,"width":811,"height":11}},{"id":"02c28d99-9056-462e-b444-b7e5076d4198","block_type":"box","text":"telephone exchanges may be difficult to complete and shareholders may have to submit exchange requests to the","page_number":166,"box":{"x":68,"y":770,"width":815,"height":12}},{"id":"2cd05ec3-174c-4e69-b062-ac81de8cb358","block_type":"box","text":"Transfer Agent in writing.","page_number":166,"box":{"x":68,"y":785,"width":175,"height":12}},{"id":"280c6c46-4aa5-4dad-8ae1-237830614965","block_type":"box","text":"If the exchanging shareholder does not currently own shares of the investment por tfolio whose shares are being","page_number":166,"box":{"x":102,"y":808,"width":800,"height":11}},{"id":"6aa7bd06-a4ad-4cc1-b13c-c00bffc17efc","block_type":"box","text":"acquired, a new account will be established with the same registration, dividend and capital gain options and broker","page_number":166,"box":{"x":69,"y":823,"width":828,"height":12}},{"id":"2394f05c-8a7c-41f4-8d2a-63d13f35256c","block_type":"box","text":"of record as the account from which shares are exchanged, unless otherwise specified in writing by the shareholder","page_number":166,"box":{"x":69,"y":838,"width":826,"height":12}},{"id":"216f4b9f-b011-4f88-9e65-6b2cea955d2c","block_type":"box","text":"with all signatures guaranteed by an eligible guarantor institution as defined below. In order to par ticipate in the","page_number":166,"box":{"x":68,"y":853,"width":797,"height":12}},{"id":"5e488913-754e-4132-a840-2d0f4029a1d8","block_type":"box","text":"Automatic Investment Program or establish a Systematic Withdrawal Plan for the new account, however, an","page_number":166,"box":{"x":68,"y":869,"width":763,"height":11}},{"id":"092c1c9c-b4fd-4af7-9847-55bb6d8e8821","block_type":"box","text":"exchanging shareholder must file a specific written request.","page_number":166,"box":{"x":69,"y":884,"width":424,"height":11}},{"id":"b9f64cab-c4ef-4a30-8b22-391218776e5e","block_type":"box","text":"II-119","page_number":166,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"55e6d868-222e-427b-9965-8020590f638e","block_type":"box","text":"NM1026U-6033063-166/246","page_number":166,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"dd3b778b-ae88-42bf-8dde-813600b60059","block_type":"box","text":"Any share exchange must satisfy the requirements relating to the minimum initial investment requirement, and","page_number":167,"box":{"x":101,"y":45,"width":790,"height":11}},{"id":"36f9b785-0d9f-41ff-a04a-caba1e8f49cd","block_type":"box","text":"must be legally available for sale in the state of the investor’s residence. For U.S. federal income tax purposes, a","page_number":167,"box":{"x":69,"y":60,"width":808,"height":11}},{"id":"19448782-9e01-43a1-9cff-b6beac347d0a","block_type":"box","text":"share exchange is a taxable event and, accordingly, a capital gain or loss may be realized. Before making an","page_number":167,"box":{"x":69,"y":75,"width":771,"height":11}},{"id":"a240725e-a2c5-4fd3-964b-21f26c608d3b","block_type":"box","text":"exchange request, shareholders should consult a tax or other financial adviser and should consider the investment","page_number":167,"box":{"x":69,"y":90,"width":819,"height":11}},{"id":"1da4a499-391c-47ae-92da-a6261c8b8f79","block_type":"box","text":"objective, policies and restrictions of the investment por tfolio into which the shareholder is making an exchange.","page_number":167,"box":{"x":69,"y":105,"width":802,"height":11}},{"id":"427cdff7-f8de-44f2-a4d6-54a541bbc547","block_type":"box","text":"Brokers may charge a fee for handling exchanges.","page_number":167,"box":{"x":70,"y":120,"width":354,"height":12}},{"id":"42958dbf-7a66-4959-99ae-0b671b96a10e","block_type":"box","text":"The Funds reserve the right to suspend, modify or terminate the exchange privilege at any time. Notice will be","page_number":167,"box":{"x":101,"y":143,"width":782,"height":11}},{"id":"0ee936a1-8f74-4f09-b621-7e117431142c","block_type":"box","text":"given to shareholders of any material modification or termination except where notice is not required. The Funds","page_number":167,"box":{"x":68,"y":158,"width":800,"height":11}},{"id":"a0ce7b14-d0d5-4dc8-845e-788b80ea7a3b","block_type":"box","text":"reserve the right to reject any telephone exchange request. Telephone exchanges may be subject to limitations as to","page_number":167,"box":{"x":69,"y":173,"width":831,"height":11}},{"id":"ec6c77cf-8a76-4b9d-b3f2-7c80974494df","block_type":"box","text":"amount or frequency, and to other restrictions that may be established from time to time to ensure that exchanges","page_number":167,"box":{"x":69,"y":188,"width":818,"height":12}},{"id":"54f69341-930e-4b81-a243-ad5973bf2016","block_type":"box","text":"do not operate to the disadvantage of any por tfolio or its shareholders.","page_number":167,"box":{"x":69,"y":203,"width":506,"height":12}},{"id":"14be8a58-fc02-4ea1-a5ec-8e0d87d2927a","block_type":"box","text":"The Funds, the Administrators and BRIL will employ reasonable procedures to confirm that instructions","page_number":167,"box":{"x":101,"y":226,"width":733,"height":11}},{"id":"0ff033b0-4fda-482d-b351-b2ab0015a80b","block_type":"box","text":"communicated by telephone are genuine. The Funds, the Administrators and BRIL will not be liable for any loss,","page_number":167,"box":{"x":69,"y":241,"width":793,"height":11}},{"id":"7c158357-d814-4e19-b23e-1e4eecc4f42e","block_type":"box","text":"liability, cost or expense for acting upon telephone instructions reasonably believed to be genuine in accordance with","page_number":167,"box":{"x":70,"y":256,"width":832,"height":12}},{"id":"940f73fb-faf1-4a57-8c84-ac6c48f7a75b","block_type":"box","text":"such procedures. By use of the exchange privilege, the investor authorizes the Fund’s Transfer Agent to act on","page_number":167,"box":{"x":69,"y":271,"width":785,"height":12}},{"id":"8d6a3c2b-65f9-4ec6-ba87-57a0737eff1e","block_type":"box","text":"telephonic or written exchange instructions from any person representing himself to be the investor and believed by","page_number":167,"box":{"x":68,"y":286,"width":825,"height":12}},{"id":"109e6f0e-5fe0-40f2-91fd-01120ef2648d","block_type":"box","text":"the Fund’s Transfer Agent to be genuine. The records of the Fund’s Transfer Agent per taining to such instructions are","page_number":167,"box":{"x":68,"y":302,"width":837,"height":11}},{"id":"aa7ae368-d105-4db1-8920-3b4fe098c7f9","block_type":"box","text":"binding. The exchange privilege may be modified or terminated at any time upon 60 days’ notice to affected","page_number":167,"box":{"x":69,"y":317,"width":767,"height":11}},{"id":"dea5186c-565e-4aad-9889-43aa9038f605","block_type":"box","text":"shareholders. The exchange privilege is only available in states where the exchange may legally be made.","page_number":167,"box":{"x":69,"y":332,"width":750,"height":11}},{"id":"68d97c12-966e-48b2-9fbc-bf2f94c71a4b","block_type":"box","text":"Each Fund reserves the right to limit the number of times an investor may exercise the exchange privilege.","page_number":167,"box":{"x":102,"y":355,"width":757,"height":11}},{"id":"13841ebf-5499-4ff7-9584-71deafa90238","block_type":"box","text":"Cer tain Funds may suspend the continuous offering of their shares to the general public at any time and may resume","page_number":167,"box":{"x":69,"y":370,"width":837,"height":11}},{"id":"5526ffc6-36cc-4a53-9a0e-aeac12a15edc","block_type":"box","text":"such offering from time to time. The exchange privilege is available only to U.S. shareholders in states where the","page_number":167,"box":{"x":69,"y":385,"width":805,"height":11}},{"id":"404c96a9-dab9-4efa-8c79-33fd51b3a8cd","block_type":"box","text":"exchange legally may be made. The exchange privilege may be applicable to other new mutual funds whose shares","page_number":167,"box":{"x":69,"y":400,"width":817,"height":11}},{"id":"c8b7330a-4e96-493f-8622-f25af90d7bf4","block_type":"box","text":"may be distributed by the Distributor.","page_number":167,"box":{"x":69,"y":415,"width":262,"height":11}},{"id":"3073a71e-6b59-417b-8c77-3fd543785bc4","block_type":"box","text":"Participation in Fee-Based Programs","page_number":167,"box":{"x":69,"y":445,"width":266,"height":11}},{"id":"e4bf8b7a-3058-4425-81d1-6c248685ea09","block_type":"box","text":"If you par ticipate in cer tain fee-based programs offered by BlackRock or an affiliate of BlackRock, or selected","page_number":167,"box":{"x":102,"y":468,"width":780,"height":11}},{"id":"9c7ed4a9-73ac-4a90-96f0-5e0e7185ced1","block_type":"box","text":"securities dealers or other financial intermediaries that have agreements with the Distributor or in cer tain fee-based","page_number":167,"box":{"x":69,"y":483,"width":826,"height":11}},{"id":"3ddaf609-8f5a-4e9a-843b-a03cbf5643c2","block_type":"box","text":"programs in which BlackRock par ticipates, you may be able to buy Institutional Shares, including by exchanges from","page_number":167,"box":{"x":70,"y":498,"width":825,"height":11}},{"id":"f7747cd0-7b5c-4f4e-bd74-6cc2fd7711cb","block_type":"box","text":"other share classes. Sales charges on the shares being exchanged may be reduced or waived under cer tain","page_number":167,"box":{"x":69,"y":513,"width":770,"height":12}},{"id":"3ca35d0e-e2fc-4699-801b-8b219cb5de1b","block_type":"box","text":"circumstances. You generally cannot transfer shares held through a fee-based program into another account. Instead,","page_number":167,"box":{"x":69,"y":528,"width":837,"height":12}},{"id":"c8c8e6f7-0750-4809-ba72-3eef29d04b77","block_type":"box","text":"if you choose to leave the fee-based program, you may have to redeem your shares held through the program and","page_number":167,"box":{"x":70,"y":543,"width":808,"height":12}},{"id":"df20a2f4-bc29-469f-922b-6f54279c3abf","block_type":"box","text":"purchase shares of another class, which may be subject to distribution and service fees. This may be a taxable event","page_number":167,"box":{"x":70,"y":559,"width":838,"height":11}},{"id":"8759763c-8757-488b-9239-7b12b1302f52","block_type":"box","text":"and you may pay any applicable sales charges or redemption fee. Please speak to your financial intermediary for","page_number":167,"box":{"x":69,"y":574,"width":804,"height":11}},{"id":"27267726-a0f4-47a9-8968-171fec217175","block_type":"box","text":"information about specific policies and procedures applicable to your account.","page_number":167,"box":{"x":70,"y":589,"width":555,"height":11}},{"id":"c580abd5-8bb2-48ff-b7aa-07d2f73ff6d3","block_type":"box","text":"Generally, upon termination of a fee-based program, the shares may be liquidated or the shares can be held in","page_number":167,"box":{"x":102,"y":612,"width":788,"height":11}},{"id":"8cc1a5a0-b007-4292-a359-4682d8686f06","block_type":"box","text":"an account. In cer tain circumstances, when a shareholder chooses to continue to hold the shares, whatever share","page_number":167,"box":{"x":69,"y":627,"width":817,"height":10}},{"id":"272407bf-7351-4355-80cd-67e6a5a748ff","block_type":"box","text":"class was held in the program can be held after termination. Shares that have been held for less than specified","page_number":167,"box":{"x":69,"y":642,"width":796,"height":11}},{"id":"a95a4f3e-2d51-4d75-96cb-b08c3ba2fd40","block_type":"box","text":"periods within the program may be subject to a fee upon redemption. Shareholders that held Investor A or","page_number":167,"box":{"x":70,"y":657,"width":754,"height":11}},{"id":"e628e3c1-2007-45b9-8196-8fd7935b1e0b","block_type":"box","text":"Institutional Shares in the program may be eligible to purchase additional shares of the respective share class of a","page_number":167,"box":{"x":70,"y":672,"width":820,"height":11}},{"id":"810b4f26-98b7-4c03-a776-22addfeefa58","block_type":"box","text":"Fund, but may be subject to upfront sales charges with respect to Investor A Shares. Additional purchases of","page_number":167,"box":{"x":70,"y":687,"width":777,"height":11}},{"id":"3a8ed111-eec1-4737-9202-f96cf0e6ea10","block_type":"box","text":"Institutional Shares are permitted only if you have an existing position at the time of purchase or are otherwise","page_number":167,"box":{"x":70,"y":702,"width":791,"height":12}},{"id":"b780c991-c3bd-463b-b799-91df2f6ffa18","block_type":"box","text":"eligible to purchase Institutional Shares. Please speak to your financial intermediary for more information.","page_number":167,"box":{"x":69,"y":717,"width":756,"height":12}},{"id":"790f47dc-6977-4c71-afc8-2fec6d1e55da","block_type":"box","text":"Cer tain financial intermediaries may, in connection with a change in account type (for example, due to leaving a","page_number":167,"box":{"x":102,"y":740,"width":793,"height":11}},{"id":"c7f8d5f6-a58f-4806-a222-8cf85f1a2792","block_type":"box","text":"fee-based program or upon termination of the fee-based program) or otherwise in accordance with the financial","page_number":167,"box":{"x":68,"y":755,"width":791,"height":11}},{"id":"ae04c7a1-4406-4206-8a47-07c058385a29","block_type":"box","text":"intermediary’s policies and procedures, exchange the share class held in the program for another share class of the","page_number":167,"box":{"x":70,"y":770,"width":830,"height":12}},{"id":"a1f17b78-4e71-4e0c-b3f3-7331a2f061fe","block_type":"box","text":"same fund, provided that the exchanged shares are not subject to a sales charge and the shareholder meets the","page_number":167,"box":{"x":69,"y":785,"width":807,"height":12}},{"id":"5326491f-e327-42a8-a858-72aba3f4a0cf","block_type":"box","text":"eligibility requirements of the new share class. Please speak to your financial intermediary for information about","page_number":167,"box":{"x":69,"y":801,"width":801,"height":11}},{"id":"07b1481b-e4ed-4e62-b18a-b596f98925a2","block_type":"box","text":"specific policies and procedures applicable to your account.","page_number":167,"box":{"x":69,"y":816,"width":424,"height":11}},{"id":"b3d4d5a8-23d8-4a2d-8bfe-d30141f379e6","block_type":"box","text":"Details about the features of each fee-based program and the relevant charges, terms and conditions are","page_number":167,"box":{"x":102,"y":838,"width":752,"height":12}},{"id":"71a7b4e3-4874-44a3-8c66-e1926fdc567c","block_type":"box","text":"included in the client agreement for each fee-based program and are available from your financial professional,","page_number":167,"box":{"x":70,"y":853,"width":789,"height":12}},{"id":"47488b20-042a-4f89-8beb-e89147da83a0","block_type":"box","text":"selected securities dealer or other financial intermediary. Please speak to your financial intermediary for more","page_number":167,"box":{"x":69,"y":869,"width":785,"height":11}},{"id":"e7313ced-6962-4ab3-811c-8bd6e6c67176","block_type":"box","text":"information.","page_number":167,"box":{"x":70,"y":884,"width":83,"height":9}},{"id":"9497673d-2dd4-4723-aae7-5975c7942ae8","block_type":"box","text":"II-120","page_number":167,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"54f1fa7a-667c-433b-ad8b-ef834da653d4","block_type":"box","text":"NM1026U-6033063-167/246","page_number":167,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"84131fbc-d100-4ce6-981f-025dd2612592","block_type":"box","text":"Retirement and Education Savings Plans","page_number":168,"box":{"x":69,"y":45,"width":296,"height":11}},{"id":"33befec2-e746-47fd-bb94-98d70db13af3","block_type":"box","text":"Individual retirement accounts and other retirement and education savings plans are available from your financial","page_number":168,"box":{"x":102,"y":67,"width":805,"height":12}},{"id":"7aeee7c9-1844-46a0-932b-ae495b9ad347","block_type":"box","text":"intermediary. Under these plans, investments may be made in a Fund (other than a Municipal Fund) and cer tain of","page_number":168,"box":{"x":70,"y":82,"width":815,"height":12}},{"id":"6d63358e-4081-4ca5-bc86-fa120878c8ec","block_type":"box","text":"the other mutual funds sponsored by the Manager or its affiliates as well as in other securities. There may be fees","page_number":168,"box":{"x":68,"y":98,"width":819,"height":11}},{"id":"9a5f69f6-8010-4a18-8eba-11dd049e509c","block_type":"box","text":"associated with investing through these plans. Information with respect to these plans is available on request from","page_number":168,"box":{"x":69,"y":113,"width":820,"height":11}},{"id":"8ebeedd0-3d76-42b4-98de-05af782d1bad","block_type":"box","text":"your financial intermediary.","page_number":168,"box":{"x":68,"y":128,"width":191,"height":11}},{"id":"b6b4d591-17fe-4a8a-bfb5-aef77294abdf","block_type":"box","text":"Dividends received in each of the plans referred to above are exempt from U.S. federal taxation until distributed","page_number":168,"box":{"x":102,"y":150,"width":796,"height":11}},{"id":"3ca9ae6e-53cb-45c3-ac59-3270aae20a38","block_type":"box","text":"from the plans and, in the case of Roth IRAs and education savings plans, may be exempt from taxation when","page_number":168,"box":{"x":68,"y":166,"width":784,"height":11}},{"id":"1dd4b09a-4695-430b-b81f-1efaef46a936","block_type":"box","text":"distributed as well. Investors considering par ticipation in any retirement or education savings plan should review","page_number":168,"box":{"x":69,"y":181,"width":801,"height":11}},{"id":"92f0265d-c9c6-4458-8b40-12f14df593cd","block_type":"box","text":"specific tax laws relating to the plan and should consult their attorneys or tax advisors with respect to the","page_number":168,"box":{"x":69,"y":196,"width":753,"height":11}},{"id":"23c0fd19-9a9a-44e3-a071-0a7f23073acb","block_type":"box","text":"establishment and maintenance of any such plan.","page_number":168,"box":{"x":69,"y":211,"width":354,"height":11}},{"id":"8db2fa4c-e0b9-4e13-81b3-acece004b2ce","block_type":"box","text":"Automatic Investment Plans","page_number":168,"box":{"x":68,"y":241,"width":207,"height":9}},{"id":"31d33eb7-863d-4254-87f2-72f68ae290a4","block_type":"box","text":"Investor class shareholders and cer tain Service Share shareholders who were shareholders of the Compass","page_number":168,"box":{"x":102,"y":264,"width":773,"height":11}},{"id":"7da760fb-ac6a-4c13-99f7-473777327a24","block_type":"box","text":"Capital Group of Funds at the time of its combination with The PNC","page_number":168,"box":{"x":69,"y":279,"width":477,"height":11}},{"id":"69c6c61f-8877-47aa-99e6-fa9bbd8b80ff","block_type":"box","text":"®","page_number":168,"box":{"x":547,"y":279,"width":6,"height":5}},{"id":"ed0e6d27-87a9-4ac0-ac07-aae127fec909","block_type":"box","text":"Fund in 1996 may arrange for periodic","page_number":168,"box":{"x":559,"y":279,"width":272,"height":11}},{"id":"b50907a1-cdd1-4502-8cf4-cc773fa39d69","block_type":"box","text":"investments in that Fund through automatic deductions from a checking or savings account. The minimum pre","page_number":168,"box":{"x":70,"y":294,"width":787,"height":11}},{"id":"0a97b71e-b3fb-47b1-8638-af2d3b3f0f55","block_type":"box","text":"authorized investment amount is $50. If you buy shares of a Fund through cer tain accounts, no minimum charge to","page_number":168,"box":{"x":69,"y":309,"width":822,"height":11}},{"id":"c989616e-12b1-4cfb-a46d-e1e8debc54eb","block_type":"box","text":"your bank account is required. Contact your financial adviser or other financial intermediary for more information.","page_number":168,"box":{"x":68,"y":324,"width":805,"height":11}},{"id":"b23148f6-216b-425b-96cc-6d453a51d4df","block_type":"box","text":"Automatic Dividend Reinvestment Plan","page_number":168,"box":{"x":68,"y":355,"width":285,"height":9}},{"id":"d8d79184-fed3-4eb7-b163-8d3e30520ab2","block_type":"box","text":"Each Fund will distribute substantially all of its net investment income and net realized capital gains, if any, to","page_number":168,"box":{"x":102,"y":377,"width":782,"height":12}},{"id":"aafe0297-3b5a-42b3-a5f0-43af9afdf73a","block_type":"box","text":"shareholders. All distributions are automatically reinvested at NAV in the form of additional full and fractional shares","page_number":168,"box":{"x":69,"y":392,"width":828,"height":12}},{"id":"7f590604-ff0f-4e39-9b43-abb38b0a3d7c","block_type":"box","text":"of the same class of shares of the relevant Fund unless a shareholder elects otherwise or as otherwise set for th in a","page_number":168,"box":{"x":69,"y":407,"width":839,"height":9}},{"id":"888fbcd1-6d00-4ede-a37d-550226fde7d6","block_type":"box","text":"Fund’s prospectus. Such election, or any revocation thereof, must be made in writing to the Transfer Agent, and will","page_number":168,"box":{"x":70,"y":423,"width":822,"height":11}},{"id":"d3d2eb08-861c-4ec3-94cc-5085588394cf","block_type":"box","text":"become effective with respect to dividends paid after its receipt by the Transfer Agent.","page_number":168,"box":{"x":69,"y":438,"width":614,"height":11}},{"id":"203eff39-1c61-445a-b5f8-1015397c0c90","block_type":"box","text":"Systematic Withdrawal Plans","page_number":168,"box":{"x":68,"y":468,"width":214,"height":11}},{"id":"1288bb77-88b0-41aa-81ac-f75468716e70","block_type":"box","text":"Shareholders may receive regular distributions from their accounts via a Systematic Withdrawal Plan (“SWP”).","page_number":168,"box":{"x":102,"y":491,"width":780,"height":11}},{"id":"f53ee828-2166-4f35-8d6b-3ad891a55945","block_type":"box","text":"Upon commencement of the SWP, the account must have a current value of $10,000 or more in a Fund.","page_number":168,"box":{"x":70,"y":505,"width":742,"height":12}},{"id":"2d841d8f-0f18-4c45-83c9-2bb5a22f1bcd","block_type":"box","text":"Shareholders may elect to receive automatic cash payments of $50 or more at any interval. You may choose any day","page_number":168,"box":{"x":69,"y":520,"width":834,"height":12}},{"id":"fb1c8d87-7dd3-4ddb-8c6a-f5d5954ba189","block_type":"box","text":"for the withdrawal. If no day is specified, the withdrawals will be processed on the 25th day of the month or, if such","page_number":168,"box":{"x":68,"y":536,"width":823,"height":11}},{"id":"505e9d59-6414-4c25-952c-3f3278ce8939","block_type":"box","text":"day is not a business day, on the prior business day and are paid promptly thereafter. An investor may utilize the SWP","page_number":168,"box":{"x":69,"y":551,"width":840,"height":11}},{"id":"ab1452fb-7cca-4576-a2d1-32ec3e1427d3","block_type":"box","text":"by completing the Systematic Withdrawal Plan Application Form which may be obtained by visiting our website at","page_number":168,"box":{"x":69,"y":566,"width":800,"height":11}},{"id":"48b3a1a2-4783-466e-a8bd-9e4ced50c067","block_type":"box","text":"www.blackrock.com.","page_number":168,"box":{"x":68,"y":582,"width":142,"height":8}},{"id":"95988447-9065-478c-bd06-bcf782b4ae1f","block_type":"box","text":"Shareholders should realize that if withdrawals exceed income dividends their invested principal in the account","page_number":168,"box":{"x":102,"y":604,"width":789,"height":11}},{"id":"10048070-8373-4024-b5b0-669cbc12ce8f","block_type":"box","text":"will be depleted. To par ticipate in the SWP, shareholders must have their dividends automatically reinvested.","page_number":168,"box":{"x":68,"y":619,"width":774,"height":11}},{"id":"9208e50c-5a9f-48d9-a8e0-1d3849f3e5a2","block_type":"box","text":"Shareholders may change or cancel the SWP at any time, upon written notice to the Fund, or by calling the Fund at","page_number":168,"box":{"x":69,"y":634,"width":815,"height":12}},{"id":"93bff258-cb86-4c8e-af00-f2d0019c5173","block_type":"box","text":"(800) 441-7762. Purchases of additional Investor A or Investor P Shares of the Fund concurrently with withdrawals","page_number":168,"box":{"x":69,"y":649,"width":817,"height":12}},{"id":"62b0bd66-af9d-4f6d-a2de-a116fa95b8c8","block_type":"box","text":"may be disadvantageous to investors because of the sales charges involved and, therefore, are discouraged. No","page_number":168,"box":{"x":69,"y":664,"width":803,"height":12}},{"id":"f31366a5-7b6a-4b46-8439-de77ca03d06d","block_type":"box","text":"CDSC will be assessed on redemptions of Investor C Shares made through the SWP that do not exceed 12% of the","page_number":168,"box":{"x":69,"y":680,"width":820,"height":11}},{"id":"37adaa30-13d8-4c7b-b9f2-6e78d1165abe","block_type":"box","text":"original investment on an annualized basis. For example, monthly, quar terly and semi-annual SWP redemptions of","page_number":168,"box":{"x":69,"y":695,"width":810,"height":11}},{"id":"d8a2fd9c-2f2d-4c16-9e4e-34f34d857086","block_type":"box","text":"Investor C Shares will not be subject to the CDSC if they do not exceed 1% (monthly), 3% (quar terly) and 6% (semi","page_number":168,"box":{"x":70,"y":710,"width":816,"height":11}},{"id":"04fc62e6-fcc1-4a0f-bb23-f649c5a3366c","block_type":"box","text":"annually), respectively, of an account’s NAV on the redemption date. SWP redemptions of Investor C Shares in excess","page_number":168,"box":{"x":69,"y":725,"width":840,"height":11}},{"id":"7258251c-e4e3-4e2a-97d6-5e4ff2ad5a4a","block_type":"box","text":"of this limit are still subject to the applicable CDSC.","page_number":168,"box":{"x":69,"y":740,"width":367,"height":11}},{"id":"ea495d38-a8f1-40ed-a795-4bca93c67940","block_type":"box","text":"For this reason, a shareholder may not par ticipate in the Automatic Investment Plan described above (see “How","page_number":168,"box":{"x":102,"y":763,"width":798,"height":11}},{"id":"b1b70df1-44b1-4624-9c21-f45f219d0d55","block_type":"box","text":"to Buy, Sell, Exchange and Transfer Shares” or “How to Buy, Sell and Exchange Shares,” as applicable, in the Fund’s","page_number":168,"box":{"x":68,"y":778,"width":834,"height":11}},{"id":"e5400915-a9a7-4d05-a3b0-eb550e7854c6","block_type":"box","text":"Prospectus) and the SWP at the same time.","page_number":168,"box":{"x":69,"y":793,"width":311,"height":11}},{"id":"f91e246b-5993-48d7-bb7b-57c4a48e00c9","block_type":"box","text":"Dividend Allocation Plan","page_number":168,"box":{"x":69,"y":823,"width":176,"height":9}},{"id":"81534d76-be26-4ac2-ab0f-522d2579bee6","block_type":"box","text":"The Dividend Allocation Plan, as applicable, allows shareholders to elect to have all their dividends and any other","page_number":168,"box":{"x":101,"y":846,"width":807,"height":11}},{"id":"90a31b8d-afd2-4211-841c-a8c4cdffd4c1","block_type":"box","text":"distributions from any Eligible Fund (which means funds so designated by the Distributor from time to time)","page_number":168,"box":{"x":69,"y":861,"width":763,"height":11}},{"id":"522e352c-69ff-4dc8-8b90-27b998282b09","block_type":"box","text":"automatically invested at NAV in one other such Eligible Fund designated by the shareholder, provided the account","page_number":168,"box":{"x":69,"y":876,"width":814,"height":11}},{"id":"dd427253-51e3-48e1-9793-b04251676cbb","block_type":"box","text":"into which the dividends and distributions are directed is initially funded with the requisite minimum amount.","page_number":168,"box":{"x":70,"y":891,"width":771,"height":11}},{"id":"63fdda7e-d318-4522-9396-e9386e18c217","block_type":"box","text":"II-121","page_number":168,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"62d78737-f14a-4b7e-b5f9-2f6b08a73053","block_type":"box","text":"NM1026U-6033063-168/246","page_number":168,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"87346771-a54f-4b24-bcc1-dcf8c215517a","block_type":"box","text":"PRICING OF SHARES","page_number":169,"box":{"x":406,"y":45,"width":167,"height":10}},{"id":"aa612923-8be8-4949-ab12-e6137bc8ca7f","block_type":"box","text":"Determination of Net Asset Value","page_number":169,"box":{"x":69,"y":76,"width":243,"height":8}},{"id":"f050eb4c-c865-407a-8837-4d26b3b77e2a","block_type":"box","text":"Valuation of Shares.","page_number":169,"box":{"x":101,"y":98,"width":145,"height":9}},{"id":"452b9959-dfdd-46a4-a712-2582ec03eb53","block_type":"box","text":"The NAV for each class of shares of each Fund is generally calculated as of the close of","page_number":169,"box":{"x":252,"y":98,"width":626,"height":11}},{"id":"eec3fba2-bc0a-42f7-8a80-a18950275517","block_type":"box","text":"regular trading hours on the NYSE (currently 4:00 p.m. Eastern Time) on each business day the NYSE is open.","page_number":169,"box":{"x":69,"y":113,"width":785,"height":12}},{"id":"2301c4ea-526d-41b1-b24d-1b7436bfaaa7","block_type":"box","text":"Valuation of assets held by a Fund is as follows:","page_number":169,"box":{"x":68,"y":128,"width":343,"height":12}},{"id":"e19e5598-fa70-4ea0-9e0b-5ae704743d54","block_type":"box","text":"Equity Investments.","page_number":169,"box":{"x":102,"y":151,"width":143,"height":11}},{"id":"49a588f2-4b42-46f8-b2b5-9f56752ac8ee","block_type":"box","text":"Equity securities traded on a recognized securities exchange (","page_number":169,"box":{"x":252,"y":151,"width":439,"height":11}},{"id":"614283d0-d71b-4597-a0cc-e53b60748aad","block_type":"box","text":"e.g.","page_number":169,"box":{"x":693,"y":153,"width":25,"height":9}},{"id":"bf427595-02af-4b21-a36b-94eb4cdd74da","block_type":"box","text":", NYSE), on separate","page_number":169,"box":{"x":720,"y":151,"width":147,"height":11}},{"id":"c0d3a1e9-3e75-46a0-a817-8fed41c4bcec","block_type":"box","text":"trading boards of a securities exchange or through a market system that provides contemporaneous transaction","page_number":169,"box":{"x":68,"y":166,"width":799,"height":11}},{"id":"f4e04f04-0095-4874-b906-ca81ad41b615","block_type":"box","text":"pricing information (each, an “Exchange”) are valued using information obtained via independent pricing services,","page_number":169,"box":{"x":70,"y":181,"width":808,"height":12}},{"id":"43b1fb54-3eff-489d-a8dd-463fd7ba0f31","block_type":"box","text":"generally at the Exchange closing price or if an Exchange closing price is not available, the last traded price on that","page_number":169,"box":{"x":68,"y":196,"width":820,"height":12}},{"id":"3e394c0c-9975-4c72-b4b2-56b9015d7051","block_type":"box","text":"Exchange prior to the time as of which the assets or liabilities are valued. However, under cer tain circumstances,","page_number":169,"box":{"x":70,"y":212,"width":805,"height":11}},{"id":"76a8ed20-e4f4-49f3-bbe5-4e28d602905b","block_type":"box","text":"other means of determining current market value may be used. If an equity security is traded on more than one","page_number":169,"box":{"x":69,"y":227,"width":793,"height":11}},{"id":"5d51ee2f-a0b5-4759-b3c4-65c7c6a8f3ff","block_type":"box","text":"Exchange, the current market value of the security where it is primarily traded generally will be used. In the event that","page_number":169,"box":{"x":70,"y":242,"width":836,"height":11}},{"id":"5d90a24d-c41c-4afe-8cbb-8a2100374848","block_type":"box","text":"there are no sales involving an equity security held by a Fund on a day on which the Fund values such security, the","page_number":169,"box":{"x":68,"y":257,"width":815,"height":11}},{"id":"b7a77684-52ed-4e65-ae46-d29d753a91d3","block_type":"box","text":"last bid (long positions) or ask (shor t positions) price, if available, will be used as the value of such security. If a Fund","page_number":169,"box":{"x":70,"y":272,"width":837,"height":11}},{"id":"9c38dff5-0a66-444c-8ee0-2a81d312c0e4","block_type":"box","text":"holds both long and shor t positions in the same security, the last bid price will be applied to securities held long and","page_number":169,"box":{"x":69,"y":287,"width":832,"height":11}},{"id":"48cc72ec-952d-4755-a4e9-4caa4e9facf8","block_type":"box","text":"the last ask price will be applied to securities sold shor t. If no bid or ask price is available on a day on which a Fund","page_number":169,"box":{"x":68,"y":302,"width":828,"height":11}},{"id":"2ff99972-00be-4a53-af26-a881ca8cf41a","block_type":"box","text":"values such security, the prior day’s price will be used, unless BlackRock determines that such prior day’s price no","page_number":169,"box":{"x":68,"y":318,"width":819,"height":11}},{"id":"627437bb-44ed-43a9-869d-e95beb259006","block_type":"box","text":"longer reflects the fair value of the security, in which case such asset would be treated as a Fair Value Asset (as","page_number":169,"box":{"x":70,"y":332,"width":798,"height":12}},{"id":"d4e96981-481b-44f0-ab89-555538bd7978","block_type":"box","text":"defined below).","page_number":169,"box":{"x":69,"y":348,"width":106,"height":11}},{"id":"8c561ceb-05c9-4a75-9817-cccb88aa5a25","block_type":"box","text":"Fixed-Income Investments.","page_number":169,"box":{"x":102,"y":370,"width":194,"height":9}},{"id":"033555fe-01c9-4bd5-836a-b5b0755a0631","block_type":"box","text":"Fixed-income securities are generally valued using bid prices provided by dealers or","page_number":169,"box":{"x":304,"y":371,"width":592,"height":11}},{"id":"98b869e1-a1d5-449a-a41f-983345e221db","block_type":"box","text":"prices (including evaluated prices) supplied by the Fund’s approved independent third-par ty pricing services, each in","page_number":169,"box":{"x":70,"y":386,"width":825,"height":11}},{"id":"cb68d557-186e-40cf-a39b-2f42bdd86ef6","block_type":"box","text":"accordance with the Valuation Procedures. The pricing services may use valuation models that utilize cer tain inputs","page_number":169,"box":{"x":69,"y":401,"width":823,"height":11}},{"id":"135ae55a-6d90-49ae-a1de-7dbd3d98e410","block_type":"box","text":"and assumptions to derive values, including transaction data (","page_number":169,"box":{"x":69,"y":416,"width":443,"height":11}},{"id":"578fe13c-bcb4-4a99-9366-47020333e930","block_type":"box","text":"e.g.","page_number":169,"box":{"x":514,"y":417,"width":24,"height":10}},{"id":"232175bc-01db-40e4-aede-fb8024c6d667","block_type":"box","text":", recent representative bids and offers), credit","page_number":169,"box":{"x":541,"y":416,"width":328,"height":11}},{"id":"0f77d41c-8c4e-4a5f-b5d5-72aefcc4831c","block_type":"box","text":"quality information, perceived market movements, news, and other relevant information and by other methods, which","page_number":169,"box":{"x":69,"y":431,"width":834,"height":11}},{"id":"768e62a0-0194-48f3-a67c-a610ec19343c","block_type":"box","text":"may include consideration of: yields or prices of securities of comparable quality, coupon, maturity and type;","page_number":169,"box":{"x":69,"y":446,"width":769,"height":11}},{"id":"de45cdc2-9ab4-40a8-bd5a-956da3220b2b","block_type":"box","text":"indications as to values from dealers; general market conditions; and/or other factors and assumptions. Pricing","page_number":169,"box":{"x":70,"y":461,"width":797,"height":11}},{"id":"5761089d-4877-465b-be9f-6d1f6a14aa67","block_type":"box","text":"services generally value fixed-income securities assuming orderly transactions of an institutional round lot size, but","page_number":169,"box":{"x":69,"y":476,"width":821,"height":11}},{"id":"0362c947-4f96-48e2-89b5-e91c745dc2f9","block_type":"box","text":"the Fund may hold or transact in such securities in smaller, odd lot sizes. Odd lots of securities in cer tain asset","page_number":169,"box":{"x":68,"y":491,"width":798,"height":11}},{"id":"390afcaf-4b45-4c9e-88d7-aa43903d721f","block_type":"box","text":"classes may trade at lower prices than institutional round lots, and the value ultimately realized when the securities","page_number":169,"box":{"x":69,"y":507,"width":825,"height":11}},{"id":"2a468316-eb87-4358-9f76-f834000c736d","block_type":"box","text":"are sold could differ from the prices used by a Fund. The amor tized cost method of valuation may be used with","page_number":169,"box":{"x":69,"y":521,"width":791,"height":12}},{"id":"209ae2c5-bfe5-467a-9efa-f0576c2370ed","block_type":"box","text":"respect to debt obligations with 60 days or less remaining to maturity unless such method does not represent fair","page_number":169,"box":{"x":69,"y":537,"width":814,"height":11}},{"id":"72ca0dae-1aea-4595-be55-71444904d8e2","block_type":"box","text":"value. Cer tain fixed-income investments, including asset-backed and mor tgage related securities, may be valued","page_number":169,"box":{"x":68,"y":552,"width":802,"height":11}},{"id":"3a0ea8a9-f25c-4fe3-b611-c47a936f74a9","block_type":"box","text":"based on valuation models that consider the estimated cash flows of each tranche of the issuer, establish a","page_number":169,"box":{"x":69,"y":567,"width":773,"height":10}},{"id":"5d51ed27-7d38-4574-9ea5-0f3af0b317cc","block_type":"box","text":"benchmark yield and develop an estimated tranche specific spread to the benchmark yield based on the unique","page_number":169,"box":{"x":69,"y":582,"width":795,"height":11}},{"id":"1db392d4-a0a9-4059-9097-e6b9001be8c8","block_type":"box","text":"attributes of the tranche.","page_number":169,"box":{"x":69,"y":597,"width":176,"height":9}},{"id":"1076da84-03f8-4eae-bff9-3b67689d22d0","block_type":"box","text":"Options, Futures, Swaps and Other Derivatives.","page_number":169,"box":{"x":101,"y":620,"width":344,"height":11}},{"id":"b2c3c898-daa5-491c-aee7-d903a3232ba3","block_type":"box","text":"Exchange-traded equity options (except ETF options, equity","page_number":169,"box":{"x":453,"y":620,"width":416,"height":11}},{"id":"4bf67aa4-1b68-42d2-a2b1-a6a51cb4482c","block_type":"box","text":"index options or those that are customized) for which market quotations are readily available are valued at the mean","page_number":169,"box":{"x":70,"y":635,"width":829,"height":11}},{"id":"b793d218-51e5-4ccd-9b3b-0a2ef3cf48ea","block_type":"box","text":"of the last bid and ask prices as quoted on the Exchange or the board of trade on which such options are traded. In","page_number":169,"box":{"x":69,"y":650,"width":824,"height":11}},{"id":"7b2d818d-eb87-4b76-8f00-9c148dec3542","block_type":"box","text":"the event that there is no mean price available for an exchange-traded equity option held by a Fund on a day on which","page_number":169,"box":{"x":68,"y":665,"width":838,"height":11}},{"id":"e1e35f7a-127b-47e1-8d5d-b322706a3b09","block_type":"box","text":"the Fund values such option, the last bid (long positions) or ask (shor t positions) price, if available, will be used as","page_number":169,"box":{"x":68,"y":680,"width":820,"height":12}},{"id":"cadf12b1-3476-4de0-90b7-32c412b2b33f","block_type":"box","text":"the value of such option. If no bid or ask price is available on a day on which a Fund values such option, the prior","page_number":169,"box":{"x":68,"y":695,"width":808,"height":11}},{"id":"3ea25ac9-ef94-42a8-b523-9b8023b673ab","block_type":"box","text":"day’s price will be used, unless BlackRock determines that such prior day’s price no longer reflects the fair value of","page_number":169,"box":{"x":69,"y":710,"width":824,"height":12}},{"id":"393a50e7-8a28-4490-9f8f-b0c2acf3fcc6","block_type":"box","text":"the option, in which case such option will be treated as a Fair Value Asset. Customized exchange-traded equity","page_number":169,"box":{"x":68,"y":726,"width":789,"height":11}},{"id":"b287e8d7-ebc5-4f60-ab33-68d07b706cc4","block_type":"box","text":"options, ETF options, equity index options and OTC derivatives, may be valued using a mathematical model which","page_number":169,"box":{"x":69,"y":741,"width":807,"height":11}},{"id":"a4dfdce4-dd37-461b-a8ba-b7c14dab0b02","block_type":"box","text":"may incorporate a number of market data factors. Financial futures contracts and options thereon, which are traded","page_number":169,"box":{"x":69,"y":756,"width":824,"height":11}},{"id":"a2b7381a-f2a1-4a94-abc2-26ec32c8b3ab","block_type":"box","text":"on exchanges, are valued at their last sale price or settle price as of the close of such exchanges. Swap agreements","page_number":169,"box":{"x":69,"y":771,"width":833,"height":11}},{"id":"38ced3e0-9089-4b26-8563-69f676e303f9","block_type":"box","text":"and other derivatives are generally valued daily based upon quotations from market makers or by a pricing service in","page_number":169,"box":{"x":69,"y":786,"width":830,"height":11}},{"id":"328dc007-5432-46f1-bb47-ff04565e460f","block_type":"box","text":"accordance with the Valuation Procedures.","page_number":169,"box":{"x":69,"y":801,"width":301,"height":9}},{"id":"3a997a15-7828-435a-8d0b-d49246b283d2","block_type":"box","text":"Underlying Funds.","page_number":169,"box":{"x":102,"y":824,"width":128,"height":11}},{"id":"69f604fa-6230-4a62-862e-ed4647a196e8","block_type":"box","text":"Shares of underlying open-end funds (including money market funds) are valued at NAV.","page_number":169,"box":{"x":237,"y":824,"width":621,"height":11}},{"id":"3020754b-539d-4f8c-9627-3219e8642e3c","block_type":"box","text":"Shares of underlying exchange-traded closed-end funds or other ETFs will be valued at their most recent closing price.","page_number":169,"box":{"x":69,"y":839,"width":837,"height":11}},{"id":"2d3a7d6c-b240-45fd-8272-8fddad7a6058","block_type":"box","text":"General Valuation Information.","page_number":169,"box":{"x":101,"y":862,"width":220,"height":9}},{"id":"97ee6910-22c9-4ddd-b426-11a5b5aefa83","block_type":"box","text":"Prices obtained from independent third-par ty pricing services, broker-dealers or","page_number":169,"box":{"x":328,"y":862,"width":564,"height":11}},{"id":"b614cbea-b9ba-47ea-bbc0-d62a54b7f139","block_type":"box","text":"market makers to value each Fund’s securities and other assets and liabilities are based on information available at","page_number":169,"box":{"x":69,"y":877,"width":831,"height":9}},{"id":"fa7266ff-5afb-46b5-b077-cfcb8dfea24a","block_type":"box","text":"the time the Fund values its assets and liabilities. In the event that a pricing service quotation is revised or updated","page_number":169,"box":{"x":68,"y":892,"width":828,"height":11}},{"id":"e1725174-a419-4c80-9db3-f1b91de73690","block_type":"box","text":"II-122","page_number":169,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"f2acb538-ee7f-43af-a4c8-779a8c99f26a","block_type":"box","text":"NM1026U-6033063-169/246","page_number":169,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"da019073-29cf-4cd7-8022-75d9f9f33538","block_type":"box","text":"subsequent to the day on which the Fund valued such security, the revised pricing service quotation generally will be","page_number":170,"box":{"x":69,"y":45,"width":829,"height":11}},{"id":"339fef09-35be-4e0a-88ee-112c9f7ae6e1","block_type":"box","text":"applied prospectively. Such determination will be made considering per tinent facts and circumstances surrounding","page_number":170,"box":{"x":69,"y":60,"width":817,"height":11}},{"id":"b8fb92fb-f54e-4b4b-9f84-74f01ff596f8","block_type":"box","text":"the revision.","page_number":170,"box":{"x":68,"y":75,"width":87,"height":9}},{"id":"4f4c8b7d-26e9-4c9b-a94f-60e76fff1a51","block_type":"box","text":"In determining the market value of por tfolio investments, the Fund may employ independent third-par ty pricing","page_number":170,"box":{"x":102,"y":98,"width":784,"height":11}},{"id":"6ffcdf4a-c1a7-49b3-86c5-5f6063832ace","block_type":"box","text":"services, which may use, without limitation, evaluated pricing methods that take into consideration market indexes,","page_number":170,"box":{"x":69,"y":113,"width":823,"height":11}},{"id":"5378fee4-1f27-47a9-b790-d5d0fe7d403c","block_type":"box","text":"matrices, yield curves and other specified inputs and assumptions. This may result in the assets being valued at a","page_number":170,"box":{"x":69,"y":128,"width":818,"height":11}},{"id":"a63626af-f2db-47e3-b10a-706cbb085a38","block_type":"box","text":"price different from the price that would have been determined had the evaluated pricing method not been used. The","page_number":170,"box":{"x":70,"y":143,"width":832,"height":11}},{"id":"0b1911f3-2a84-4438-932d-df56c4ff767c","block_type":"box","text":"price the Fund could receive upon the sale of any par ticular por tfolio investment may differ from the Fund’s valuation","page_number":170,"box":{"x":70,"y":158,"width":832,"height":11}},{"id":"786fb3b9-6980-4952-b89a-1a9e5b1ecf55","block_type":"box","text":"of the investment, par ticularly for assets that trade in thin or volatile markets or that are valued using a fair valuation","page_number":170,"box":{"x":69,"y":173,"width":834,"height":11}},{"id":"db0961a4-0b11-4edc-8932-ba5103b05feb","block_type":"box","text":"methodology or a price provided by an independent pricing service. As a result, the price received upon the sale of an","page_number":170,"box":{"x":69,"y":188,"width":837,"height":12}},{"id":"da48693f-696b-4a25-bfd8-635dc3824c80","block_type":"box","text":"investment may be less than the value ascribed by the Fund, and the Fund could realize a greater than expected loss","page_number":170,"box":{"x":70,"y":204,"width":833,"height":11}},{"id":"5eb6adaf-2a4e-4230-a6cb-cdd2c575efc6","block_type":"box","text":"or lesser than expected gain upon the sale of the investment. The Fund’s ability to value its investment may also be","page_number":170,"box":{"x":69,"y":218,"width":827,"height":12}},{"id":"957fd912-f0ec-4324-b1f9-2371e1f66370","block_type":"box","text":"impacted by technological issues and/or errors by pricing services or other third-par ty service providers.","page_number":170,"box":{"x":70,"y":234,"width":741,"height":11}},{"id":"9ca06a10-3202-4127-afec-19590b406627","block_type":"box","text":"In the event that application of the methods of valuation discussed above result in a price for a security which is","page_number":170,"box":{"x":102,"y":256,"width":800,"height":11}},{"id":"181ebbe2-9cb0-41a3-8408-2aeba71b71e2","block_type":"box","text":"deemed not to be representative of the fair market value of such security, the security will be valued by, under the","page_number":170,"box":{"x":69,"y":271,"width":811,"height":12}},{"id":"3c39a558-d47c-49eb-a8be-430a8cb0d04c","block_type":"box","text":"direction of or in accordance with a method approved by BlackRock, the Fund’s valuation designee, as reflecting fair","page_number":170,"box":{"x":69,"y":286,"width":827,"height":12}},{"id":"92f6321e-9f38-454c-b287-bfc1c7dc14f6","block_type":"box","text":"value. All other assets and liabilities (including securities for which market quotations are not readily available) held","page_number":170,"box":{"x":68,"y":302,"width":824,"height":11}},{"id":"79e22662-55bb-4496-b74e-b7e7929784dc","block_type":"box","text":"by a Fund (including restricted securities and private market investments, as applicable) are valued at fair value as","page_number":170,"box":{"x":69,"y":317,"width":817,"height":11}},{"id":"6e0f8a7b-9f88-4b00-85c3-83df5e1301df","block_type":"box","text":"determined in good faith by BlackRock pursuant to the Valuation Procedures. Any assets and liabilities which are","page_number":170,"box":{"x":69,"y":332,"width":802,"height":11}},{"id":"581a6097-fc00-4f2c-ada2-3aa16e610275","block_type":"box","text":"denominated in a foreign currency are translated into U.S. dollars at the prevailing market rates.","page_number":170,"box":{"x":69,"y":347,"width":685,"height":11}},{"id":"4e60d364-028e-4f44-87bb-6c8302441983","block_type":"box","text":"Cer tain of the securities acquired by the Funds may be traded on foreign exchanges or OTC markets on days on","page_number":170,"box":{"x":102,"y":370,"width":795,"height":11}},{"id":"668e4e30-df46-45ca-830b-667fe97355a4","block_type":"box","text":"which a Fund’s NAV is not calculated. In such cases, the NAV of a Fund’s shares may be significantly affected on","page_number":170,"box":{"x":68,"y":385,"width":805,"height":11}},{"id":"65525e4a-3043-4869-b0d6-880fe6655622","block_type":"box","text":"days when investors can neither purchase nor redeem shares of the Fund.","page_number":170,"box":{"x":69,"y":400,"width":529,"height":11}},{"id":"bb1bd153-1f72-4457-8276-979062f239a9","block_type":"box","text":"Fair Value.","page_number":170,"box":{"x":102,"y":423,"width":74,"height":9}},{"id":"40ab42c7-51d4-46d3-adc5-aa5a69c92a3a","block_type":"box","text":"When market quotations are not readily available or are believed by BlackRock to be unreliable, a","page_number":170,"box":{"x":183,"y":423,"width":693,"height":11}},{"id":"7186ea1f-78e6-4d4b-b4bd-04f4e6557e8d","block_type":"box","text":"Fund’s investments are valued at fair value (“Fair Value Assets”). Fair Value Assets are valued by BlackRock in","page_number":170,"box":{"x":70,"y":438,"width":785,"height":11}},{"id":"25bb6d49-a4dc-494c-abd8-9b7bd79892ca","block_type":"box","text":"accordance with the Valuation Procedures. Pursuant to Rule 2a-5 under the Investment Company Act, the Board of","page_number":170,"box":{"x":69,"y":453,"width":816,"height":11}},{"id":"a348e3b8-79ca-4cb9-84bb-e957aabd2fab","block_type":"box","text":"Directors has designated BlackRock as the valuation designee for the respective Funds for which it serves as","page_number":170,"box":{"x":70,"y":468,"width":779,"height":11}},{"id":"cf099d7d-b07a-405b-9394-987937bd6429","block_type":"box","text":"investment adviser. BlackRock may reasonably conclude that a market quotation is not readily available or is","page_number":170,"box":{"x":70,"y":483,"width":773,"height":11}},{"id":"a539e9df-13f2-4e36-8a0d-6f28fb93e4b7","block_type":"box","text":"unreliable if, among other things, a security or other asset or liability does not have a price source due to its","page_number":170,"box":{"x":69,"y":498,"width":772,"height":11}},{"id":"694ddb75-192b-4781-93f6-03cc75dc9aeb","block_type":"box","text":"complete lack of trading, if BlackRock believes a market quotation from a broker-dealer or other source is unreliable","page_number":170,"box":{"x":69,"y":513,"width":826,"height":12}},{"id":"172726c1-8371-4ed7-a74a-1f24ed3fdab3","block_type":"box","text":"(","page_number":170,"box":{"x":69,"y":529,"width":3,"height":10}},{"id":"0a431c25-8a81-44e9-86c9-a10f48a121ef","block_type":"box","text":"e.g.","page_number":170,"box":{"x":74,"y":530,"width":25,"height":10}},{"id":"e9ff45c7-380b-429b-aad2-30d7c3cd9964","block_type":"box","text":", where it varies significantly from a recent trade, or no longer reflects the fair value of the security or other asset","page_number":170,"box":{"x":101,"y":528,"width":806,"height":12}},{"id":"47442d7d-38ad-4212-9c2b-d5ebd4cc60e3","block_type":"box","text":"or liability subsequent to the most recent market quotation), or where the security or other asset or liability is only","page_number":170,"box":{"x":69,"y":544,"width":813,"height":11}},{"id":"ddc55102-14e1-45f2-9ac6-2f30f33839da","block_type":"box","text":"thinly traded or due to the occurrence of a significant event subsequent to the most recent market quotation. For this","page_number":170,"box":{"x":68,"y":559,"width":837,"height":11}},{"id":"47eaeee4-b66f-4976-b59b-49dd0918fd4c","block_type":"box","text":"purpose, a “significant event” is deemed to occur if BlackRock determines, in its reasonable business judgment, that","page_number":170,"box":{"x":70,"y":574,"width":838,"height":11}},{"id":"3cea3d17-8a17-45e9-b6b0-34aa4a05ab25","block_type":"box","text":"an event has occurred after the close of trading for an asset or liability but prior to or at the time of pricing a Fund’s","page_number":170,"box":{"x":69,"y":589,"width":824,"height":11}},{"id":"07ae4f42-545b-410b-81fe-9df9190ad422","block_type":"box","text":"assets or liabilities, is likely to cause a material change to the last exchange closing price or closing market price of","page_number":170,"box":{"x":69,"y":604,"width":828,"height":11}},{"id":"a549fbb1-4609-4b1e-a576-818015f6947b","block_type":"box","text":"one or more assets held by, or liabilities of, the Fund. On any day the NYSE is open and a foreign market or the","page_number":170,"box":{"x":69,"y":619,"width":793,"height":11}},{"id":"817f00ca-9704-419e-bbb0-dd0448ddd51a","block_type":"box","text":"primary exchange on which a foreign asset or liability is traded is closed, such asset or liability will be valued using","page_number":170,"box":{"x":70,"y":634,"width":819,"height":12}},{"id":"289ffe1c-91f0-4219-96be-b5868f93cd9f","block_type":"box","text":"the prior day’s price, provided that BlackRock is not aware of any significant event or other information that would","page_number":170,"box":{"x":68,"y":649,"width":810,"height":12}},{"id":"814bbf76-f36c-4480-befe-3d60093c004c","block_type":"box","text":"cause such price to no longer reflect the fair value of the asset or liability, in which case such asset or liability would","page_number":170,"box":{"x":69,"y":664,"width":828,"height":12}},{"id":"c884b490-3ebc-44a7-9d37-4797372d64da","block_type":"box","text":"be treated as a Fair Value Asset. For cer tain foreign assets, a third-par ty vendor supplies evaluated, systematic fair","page_number":170,"box":{"x":69,"y":680,"width":822,"height":11}},{"id":"8a5b9d59-147e-4fed-b6d4-4ea8b21ff9af","block_type":"box","text":"value pricing based upon the movement of a proprietary multi-factor model after the relevant foreign markets have","page_number":170,"box":{"x":68,"y":695,"width":814,"height":11}},{"id":"8cdb9636-0682-4010-8f47-79370a46f62b","block_type":"box","text":"closed. This systematic fair value pricing methodology is designed to correlate the prices of foreign assets in one or","page_number":170,"box":{"x":69,"y":710,"width":827,"height":11}},{"id":"6f0fb8de-a2e7-402e-bfcb-4a6ba30a874a","block_type":"box","text":"more non-U.S. markets following the close of the local markets to the prices that might have prevailed as of a Fund’s","page_number":170,"box":{"x":69,"y":725,"width":834,"height":11}},{"id":"20fbdfdc-9150-4ab4-add1-222371baaab0","block_type":"box","text":"pricing time.","page_number":170,"box":{"x":70,"y":740,"width":85,"height":11}},{"id":"dc5fe864-fbfe-4d3e-97f4-e8826aaecbeb","block_type":"box","text":"BlackRock’s Rule 2a-5 Committee is responsible for reviewing and approving methodologies by investment type","page_number":170,"box":{"x":102,"y":763,"width":794,"height":11}},{"id":"b8e1fcc7-7241-413e-8720-321d948dfd56","block_type":"box","text":"and significant inputs used in the fair valuation of Fund assets or liabilities. In addition, the Funds’ accounting agent","page_number":170,"box":{"x":69,"y":778,"width":829,"height":11}},{"id":"326b9086-fb88-42a6-b3d0-da73c3bb5af8","block_type":"box","text":"assists BlackRock by periodically endeavoring to confirm the prices it receives from all third-par ty pricing services,","page_number":170,"box":{"x":69,"y":793,"width":813,"height":11}},{"id":"28672448-b5d1-4b66-9ffa-f3ffd2736f0f","block_type":"box","text":"index providers and broker-dealers. BlackRock regularly evaluates the values assigned to the securities and other","page_number":170,"box":{"x":70,"y":808,"width":808,"height":11}},{"id":"dc0f20b9-bf91-4c3c-8384-fc436a2ce60d","block_type":"box","text":"assets and liabilities of the Funds.","page_number":170,"box":{"x":69,"y":823,"width":245,"height":9}},{"id":"820b306d-d42b-457f-9cf1-0e144d720c63","block_type":"box","text":"When determining the price for a Fair Value Asset, BlackRock will seek to determine the price that a Fund might","page_number":170,"box":{"x":101,"y":846,"width":795,"height":11}},{"id":"6e3429c0-9b34-4d1a-9fe7-00b92b677ebf","block_type":"box","text":"reasonably expect to receive from the current sale of that asset or liability in an arm’s-length transaction on the date","page_number":170,"box":{"x":69,"y":861,"width":832,"height":11}},{"id":"efc8cc7e-5607-47a3-bff8-973794e31076","block_type":"box","text":"on which the asset or liability is being valued, and does not seek to determine the price a Fund might reasonably","page_number":170,"box":{"x":69,"y":876,"width":805,"height":11}},{"id":"05087935-18b4-4508-a00d-bef43faa8a34","block_type":"box","text":"expect to receive for selling an asset or liability at a later time or if it holds the asset or liability to maturity. Fair value","page_number":170,"box":{"x":69,"y":891,"width":834,"height":12}},{"id":"17449d11-d23b-470b-8208-ccf935afd20b","block_type":"box","text":"II-123","page_number":170,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"e385cb8a-9838-4768-8c40-56e51e1ced4d","block_type":"box","text":"NM1026U-6033063-170/246","page_number":170,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"c6ec5be2-4cca-44a0-8492-158d3d03e73c","block_type":"box","text":"determinations will be based upon all available factors that BlackRock deems relevant at the time of the","page_number":171,"box":{"x":69,"y":45,"width":744,"height":11}},{"id":"38364391-2d6d-43ff-ba9b-5766ef0d5e38","block_type":"box","text":"determination, and may be based on analytical values determined by BlackRock using proprietary or third-par ty","page_number":171,"box":{"x":69,"y":60,"width":791,"height":11}},{"id":"0211483f-4157-462b-8ffe-a75d7f9b65e0","block_type":"box","text":"valuation models.","page_number":171,"box":{"x":68,"y":75,"width":125,"height":9}},{"id":"87ced5f0-ec9e-462e-9edc-36c5bec07394","block_type":"box","text":"Fair value represents a good faith approximation of the value of an asset or liability. When determining the fair","page_number":171,"box":{"x":102,"y":98,"width":785,"height":11}},{"id":"01773b0f-5c50-48a8-a467-9e92236c0c0d","block_type":"box","text":"value of an investment, one or more fair value methodologies may be used (depending on cer tain factors, including","page_number":171,"box":{"x":68,"y":113,"width":822,"height":11}},{"id":"23b192a4-6c38-4c6c-a6e4-0ea877f5083a","block_type":"box","text":"the asset type). For example, the investment may be initially priced based on the original cost of the investment or,","page_number":171,"box":{"x":68,"y":128,"width":820,"height":11}},{"id":"fcd3324f-fa57-480f-bd94-db818b79b3c1","block_type":"box","text":"alternatively, using proprietary or third-par ty models that may rely upon one or more unobservable inputs. Prices of","page_number":171,"box":{"x":69,"y":143,"width":818,"height":11}},{"id":"d096dcb3-b385-4ca8-b0e1-2e997b764df0","block_type":"box","text":"actual, executed or historical transactions in the relevant investment (or comparable instruments) or, where","page_number":171,"box":{"x":69,"y":158,"width":766,"height":11}},{"id":"2b14a688-0cc5-4206-803b-6431569728cd","block_type":"box","text":"appropriate, an appraisal by a third-par ty experienced in the valuation of similar instruments, may also be used as a","page_number":171,"box":{"x":69,"y":173,"width":828,"height":11}},{"id":"633be69f-fcfa-4685-9194-cf8563ead51e","block_type":"box","text":"basis for establishing the fair value of an investment.","page_number":171,"box":{"x":69,"y":188,"width":378,"height":12}},{"id":"2756e769-70b0-458b-b3b6-4d552e52a225","block_type":"box","text":"The fair value of one or more assets or liabilities may not, in retrospect, be the price at which those assets or","page_number":171,"box":{"x":101,"y":211,"width":784,"height":11}},{"id":"2aefb340-79ae-4c4c-9cf0-aa22a22e9a5d","block_type":"box","text":"liabilities could have been sold during the period in which the par ticular fair values were used in determining a Fund’s","page_number":171,"box":{"x":70,"y":226,"width":836,"height":11}},{"id":"d963a9d9-d461-4d3b-8dac-423248d82d7f","block_type":"box","text":"NAV. As a result, a Fund’s sale or redemption of its shares at NAV, at a time when a holding or holdings are valued at","page_number":171,"box":{"x":70,"y":241,"width":834,"height":11}},{"id":"d5758878-c878-4465-b291-8a657cd701b6","block_type":"box","text":"fair value, may have the effect of diluting or increasing the economic interest of existing shareholders.","page_number":171,"box":{"x":68,"y":256,"width":728,"height":12}},{"id":"6cc88442-530e-4849-ae6e-b936804af34e","block_type":"box","text":"Each Fund’s annual audited financial statements, which are prepared in accordance with accounting principles","page_number":171,"box":{"x":102,"y":279,"width":786,"height":11}},{"id":"cbb9cdb6-2d85-4caa-b5f9-c1655094a202","block_type":"box","text":"generally accepted in the United States of America (“US GAAP”), follow the requirements for valuation set for th in","page_number":171,"box":{"x":68,"y":294,"width":809,"height":11}},{"id":"7c3096a7-b505-4548-a4ac-43afce548503","block_type":"box","text":"Financial Accounting Standards Board Accounting Standards Codification Topic 820, “Fair Value Measurements and","page_number":171,"box":{"x":70,"y":309,"width":821,"height":11}},{"id":"4f9c90a3-b4b0-4653-a7e9-32bfcc854d22","block_type":"box","text":"Disclosures” (“ASC 820”), which defines and establishes a framework for measuring fair value under US GAAP and","page_number":171,"box":{"x":70,"y":324,"width":818,"height":12}},{"id":"5cb06223-3d13-4c97-b276-7573c99fdcc3","block_type":"box","text":"expands financial statement disclosure requirements relating to fair value measurements.","page_number":171,"box":{"x":69,"y":339,"width":641,"height":12}},{"id":"f2740154-9c5b-423b-a0cd-4bece5d71209","block_type":"box","text":"Generally, ASC 820 and other accounting rules applicable to funds and various assets in which they invest are","page_number":171,"box":{"x":102,"y":362,"width":786,"height":11}},{"id":"dfc08cac-5478-4ea8-bd99-199f3e0f84cd","block_type":"box","text":"evolving. Such changes may adversely affect a Fund. For example, the evolution of rules governing the determination","page_number":171,"box":{"x":69,"y":377,"width":832,"height":12}},{"id":"33356f77-37cb-473a-80fc-0eef4c4c5227","block_type":"box","text":"of the fair market value of assets or liabilities, to the extent such rules become more stringent, would tend to","page_number":171,"box":{"x":69,"y":392,"width":780,"height":12}},{"id":"16db9871-6eb2-4bd8-8d2b-fe7357a990a9","block_type":"box","text":"increase the cost and/or reduce the availability of third-par ty determinations of fair market value. This may in turn","page_number":171,"box":{"x":70,"y":407,"width":810,"height":12}},{"id":"c4b0e4a1-cb01-4866-bb08-88cee7c3cb00","block_type":"box","text":"increase the costs associated with selling assets or affect their liquidity due to a Fund’s inability to obtain a third","page_number":171,"box":{"x":70,"y":423,"width":810,"height":11}},{"id":"45b62172-2764-4709-b246-df1849271a9d","block_type":"box","text":"par ty determination of fair market value.","page_number":171,"box":{"x":70,"y":438,"width":285,"height":11}},{"id":"2cbca069-d709-4979-9d8d-62543f8c492a","block_type":"box","text":"Computation of Offering Price Per Share","page_number":171,"box":{"x":69,"y":468,"width":292,"height":11}},{"id":"eb69d333-63fd-4ee8-a884-8772d488ab15","block_type":"box","text":"See “Computation of Offering Price Per Share” in Par t I of a Fund’s SAI for an illustration of the computation of","page_number":171,"box":{"x":102,"y":491,"width":791,"height":11}},{"id":"8d788d44-64a4-4cdb-85f6-af770d68b4a7","block_type":"box","text":"the offering price for shares of your Fund.","page_number":171,"box":{"x":68,"y":506,"width":295,"height":11}},{"id":"a6e80f09-5e92-4c66-a070-80491c7ae019","block_type":"box","text":"PORTFOLIO TRANSACTIONS AND BROKERAGE","page_number":171,"box":{"x":303,"y":535,"width":373,"height":10}},{"id":"932e5dce-4e3a-4777-b096-28257daf16ac","block_type":"box","text":"Transactions in Portfolio Securities","page_number":171,"box":{"x":68,"y":566,"width":257,"height":9}},{"id":"43737e38-b0b0-47eb-b9ce-73285f21e305","block_type":"box","text":"Subject to policies established by the Board of Directors, BlackRock is primarily responsible for the execution of","page_number":171,"box":{"x":102,"y":588,"width":798,"height":11}},{"id":"8cfe188d-da1b-46fd-ae98-3ca923575f04","block_type":"box","text":"a Fund’s por tfolio transactions and the allocation of brokerage. BlackRock does not execute transactions through any","page_number":171,"box":{"x":69,"y":603,"width":839,"height":12}},{"id":"376fb1ee-b41e-4797-8bca-d35e0d9e69a1","block_type":"box","text":"par ticular broker or dealer, but seeks to obtain the best net results for the Fund, taking into account cer tain factors","page_number":171,"box":{"x":70,"y":618,"width":822,"height":12}},{"id":"2c9c6868-9d3f-4c3d-851b-d642ee352db6","block_type":"box","text":"set out below. While BlackRock generally seeks reasonable trade execution costs, a Fund does not necessarily pay","page_number":171,"box":{"x":69,"y":634,"width":820,"height":11}},{"id":"a1c00f80-8bf3-4247-9a5b-270dad83936c","block_type":"box","text":"the lowest spread or commission available, and payment of the lowest commission or spread is not necessarily","page_number":171,"box":{"x":68,"y":649,"width":798,"height":11}},{"id":"4efd45ec-6c94-43ce-bf36-a335f2ffa72d","block_type":"box","text":"consistent with obtaining the best price and execution in par ticular transactions. Subject to applicable legal","page_number":171,"box":{"x":69,"y":664,"width":765,"height":11}},{"id":"003a8207-7d94-4567-8f1d-3f5b7f3a3449","block_type":"box","text":"requirements, BlackRock may select a broker based par tly upon brokerage or research services provided to","page_number":171,"box":{"x":69,"y":679,"width":768,"height":11}},{"id":"6ba32387-22ca-455b-8964-5d382b7f7de1","block_type":"box","text":"BlackRock and its clients, including a Fund. In return for such services, BlackRock may cause a Fund to pay a higher","page_number":171,"box":{"x":70,"y":694,"width":830,"height":11}},{"id":"34c78816-fdb0-49d5-8fdd-e5034c9f34aa","block_type":"box","text":"commission than other brokers would charge if BlackRock determines in good faith that the commission is","page_number":171,"box":{"x":69,"y":709,"width":760,"height":11}},{"id":"d1a6db32-3427-4975-bd1b-1dc183b72568","block_type":"box","text":"reasonable in relation to the services provided.","page_number":171,"box":{"x":69,"y":725,"width":336,"height":10}},{"id":"892603ca-0fb7-4de5-9c86-cfb7d539eb06","block_type":"box","text":"In the case of Feeder Funds, because each Feeder Fund generally invests exclusively in beneficial interests of a","page_number":171,"box":{"x":102,"y":747,"width":794,"height":11}},{"id":"ccc531a5-f935-4054-814c-998e4400bb34","block_type":"box","text":"Master Por tfolio, it is expected that all transactions in por tfolio securities will be entered into by the Master Por tfolio.","page_number":171,"box":{"x":70,"y":762,"width":835,"height":11}},{"id":"c3cfd195-67e8-476b-a2c4-724c7a713075","block_type":"box","text":"In selecting brokers or dealers to execute por tfolio transactions, the Manager and sub-advisers seek to obtain","page_number":171,"box":{"x":102,"y":785,"width":784,"height":11}},{"id":"5f786214-1a69-47cc-bd48-90e57681164f","block_type":"box","text":"the best price and most favorable execution for a Fund, taking into account a variety of factors including: (i) the size,","page_number":171,"box":{"x":68,"y":800,"width":829,"height":11}},{"id":"8d94fc2e-e8b8-4d5d-a078-6f2f821c5a9b","block_type":"box","text":"nature and character of the security or instrument being traded and the markets in which it is purchased or sold;","page_number":171,"box":{"x":69,"y":815,"width":802,"height":11}},{"id":"d5970cf3-773a-41a4-9e7c-960d24c92fc3","block_type":"box","text":"(ii) the desired timing of the transaction; (iii) BlackRock’s knowledge of the expected commission rates and spreads","page_number":171,"box":{"x":69,"y":830,"width":826,"height":11}},{"id":"11bf2bea-7d10-4de9-a1cc-35810673c21e","block_type":"box","text":"currently available; (iv) the activity existing and expected in the market for the par ticular security or instrument,","page_number":171,"box":{"x":69,"y":845,"width":789,"height":12}},{"id":"2d327710-aa0d-4b95-9ba3-523f3ccfa4f3","block_type":"box","text":"including any anticipated execution difficulties; (v) the full range of brokerage services provided; (vi) the broker’s or","page_number":171,"box":{"x":70,"y":860,"width":818,"height":12}},{"id":"97ecae07-07e0-4eff-80dc-8743bafc031e","block_type":"box","text":"dealer’s capital; (vii) the quality of research and research services provided; (viii) the reasonableness of the","page_number":171,"box":{"x":69,"y":875,"width":769,"height":12}},{"id":"295502ba-133c-4a6c-b861-566a28768ec5","block_type":"box","text":"commission, dealer spread or its equivalent for the specific transaction; and (ix) BlackRock’s knowledge of any actual","page_number":171,"box":{"x":69,"y":891,"width":837,"height":11}},{"id":"c81542f1-757e-4053-9ee4-010ba467d61d","block_type":"box","text":"or apparent operational problems of a broker or dealer.","page_number":171,"box":{"x":69,"y":906,"width":391,"height":11}},{"id":"50ef7c8c-a7b9-4b27-94f9-3cf52ad8ca75","block_type":"box","text":"II-124","page_number":171,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"d38df012-e20c-4a36-8a45-5eb946f55ad3","block_type":"box","text":"NM1026U-6033063-171/246","page_number":171,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"e63378f5-9794-42fd-8f87-05bdf66d9d7c","block_type":"box","text":"Section 28(e) of the Exchange Act (“Section 28(e)”) permits an investment adviser, under cer tain circumstances","page_number":172,"box":{"x":102,"y":45,"width":801,"height":11}},{"id":"27825312-fcc2-4c2d-90fe-506d244d3616","block_type":"box","text":"to cause an account to pay a broker or dealer a commission for effecting a transaction that exceeds the amount","page_number":172,"box":{"x":68,"y":60,"width":802,"height":11}},{"id":"79ae7476-c88d-4050-9424-8e0810d22e4a","block_type":"box","text":"another broker or dealer would have charged for effecting the same transaction in recognition of the value of","page_number":172,"box":{"x":69,"y":75,"width":775,"height":11}},{"id":"d0a9d507-ef06-4ce3-841e-ff4740eae6a9","block_type":"box","text":"brokerage and research services provided by that broker or dealer. This includes commissions paid on riskless","page_number":172,"box":{"x":69,"y":90,"width":790,"height":11}},{"id":"d5d58911-03c6-4c62-91eb-f77a24b86ee0","block_type":"box","text":"principal transactions under cer tain conditions. Brokerage and research services include: (1) furnishing advice as to","page_number":172,"box":{"x":70,"y":105,"width":827,"height":11}},{"id":"44c34e57-c08d-4ae1-ae5b-14b77e106635","block_type":"box","text":"the value of securities, including pricing and appraisal advice, credit analysis, risk measurement analysis,","page_number":172,"box":{"x":68,"y":120,"width":753,"height":12}},{"id":"2cdaf237-e3a0-4a38-9d6a-1520ce5fb346","block_type":"box","text":"per formance and other analysis, as well as the advisability of investing in, purchasing or selling securities, and the","page_number":172,"box":{"x":70,"y":135,"width":818,"height":12}},{"id":"2437747e-dfc3-442d-80a3-abb1a4b1befb","block_type":"box","text":"availability of securities or purchasers or sellers of securities; (2) furnishing analyses and repor ts concerning issuers,","page_number":172,"box":{"x":69,"y":150,"width":837,"height":12}},{"id":"9442d52f-0d03-49c0-a461-dd3f20df49df","block_type":"box","text":"industries, securities, economic factors and trends, por tfolio strategy, and the per formance of accounts; and","page_number":172,"box":{"x":70,"y":166,"width":775,"height":11}},{"id":"08355315-a07f-4f23-9bc1-4a23a236d7db","block_type":"box","text":"(3) effecting securities transactions and per forming functions incidental to securities transactions (such as","page_number":172,"box":{"x":69,"y":181,"width":764,"height":11}},{"id":"7077e5d5-a0dc-4411-864d-10d982ebb8fb","block_type":"box","text":"clearance, settlement, and custody). BlackRock believes that access to independent investment research is","page_number":172,"box":{"x":69,"y":196,"width":770,"height":11}},{"id":"3e26e3d0-8e8b-4e44-9044-ec4079c7e4cb","block_type":"box","text":"beneficial to its investment decision-making processes and, therefore, to the Funds.","page_number":172,"box":{"x":69,"y":211,"width":599,"height":11}},{"id":"2f19b745-59dc-4dc8-8263-f4fdb1270bf1","block_type":"box","text":"BlackRock, unless prohibited by applicable law, may par ticipate in client commission arrangements under which","page_number":172,"box":{"x":102,"y":234,"width":796,"height":11}},{"id":"2c4382ba-56eb-4854-a34d-965eb88bd4dd","block_type":"box","text":"BlackRock may execute transactions through a broker-dealer and request that the broker-dealer allocate a por tion of","page_number":172,"box":{"x":70,"y":249,"width":829,"height":11}},{"id":"e0005349-80e3-4e01-b75c-ef2b3fa29176","block_type":"box","text":"the commissions or commission credits to another firm that provides research to BlackRock. BlackRock believes that","page_number":172,"box":{"x":68,"y":264,"width":839,"height":11}},{"id":"68fd72b3-e72b-4533-bf6b-1f9861b7a4e1","block_type":"box","text":"research services obtained through soft dollar or commission sharing arrangements enhance its investment decision","page_number":172,"box":{"x":69,"y":279,"width":839,"height":11}},{"id":"007f7aff-a3b4-4d9a-8441-3323ec6e2117","block_type":"box","text":"making capabilities, thereby increasing the prospects for higher investment returns. BlackRock will engage only in","page_number":172,"box":{"x":69,"y":294,"width":809,"height":11}},{"id":"f7ca74cb-2f4e-47d5-80d3-06210d78b283","block_type":"box","text":"soft dollar or commission sharing transactions that comply with the requirements of Section 28(e). Cer tain Funds","page_number":172,"box":{"x":69,"y":309,"width":808,"height":11}},{"id":"4b0cc6e9-ae66-452b-a61d-ccdc265b3839","block_type":"box","text":"may be subject to additional regulations, including MiFID II. Under MiFID II, EU investment managers, including BIL,","page_number":172,"box":{"x":69,"y":325,"width":818,"height":11}},{"id":"21d70810-9da6-4f7a-bd83-8948b5c20682","block_type":"box","text":"pay for any research out of their own resources and not through soft dollars or commission sharing arrangements.","page_number":172,"box":{"x":70,"y":339,"width":813,"height":12}},{"id":"ed279fc9-f525-4cda-8dbd-f04397c880cd","block_type":"box","text":"BlackRock regularly evaluates the soft dollar products and services utilized, as well as the overall soft dollar and","page_number":172,"box":{"x":70,"y":355,"width":801,"height":11}},{"id":"b4f83af3-6f6b-4a13-9454-ac4e28526113","block_type":"box","text":"commission sharing arrangements to ensure that trades are executed by firms that are regarded as best able to","page_number":172,"box":{"x":69,"y":370,"width":802,"height":11}},{"id":"774a9eff-424b-437a-8235-e02f11ae4657","block_type":"box","text":"execute trades for client accounts, while at the same time providing access to the research and other services","page_number":172,"box":{"x":69,"y":385,"width":790,"height":11}},{"id":"f58a3808-a7dd-489d-9b11-6e28ca251473","block_type":"box","text":"BlackRock views as impactful to its trading results.","page_number":172,"box":{"x":70,"y":400,"width":361,"height":11}},{"id":"8c80d9c5-6e6e-481b-b3a6-e1f5a5594305","block_type":"box","text":"BlackRock, unless prohibited by applicable law, may utilize soft dollars and related services, including research","page_number":172,"box":{"x":102,"y":423,"width":791,"height":11}},{"id":"dfe38461-7fab-493e-9238-650551e6ac84","block_type":"box","text":"(whether prepared by the broker-dealer or prepared by a third-par ty and provided to BlackRock by the broker-dealer)","page_number":172,"box":{"x":69,"y":438,"width":819,"height":11}},{"id":"4d4cdd5a-a5db-411c-9464-9079209deb3b","block_type":"box","text":"and execution or brokerage services within applicable rules and BlackRock’s policies to the extent that such","page_number":172,"box":{"x":69,"y":453,"width":772,"height":11}},{"id":"18defd25-4030-431e-a6ae-97644bef5ee9","block_type":"box","text":"permitted services do not compromise BlackRock’s ability to seek to obtain best execution. In this regard, the","page_number":172,"box":{"x":70,"y":468,"width":785,"height":11}},{"id":"55f74a24-5f6c-4022-a2e1-1224e8674bab","block_type":"box","text":"por tfolio management investment and/or trading teams may consider a variety of factors, including the degree to","page_number":172,"box":{"x":70,"y":483,"width":806,"height":11}},{"id":"2848fd89-7eed-4164-955e-5a77842134f4","block_type":"box","text":"which the broker-dealer: (a) provides access to company management; (b) provides access to their analysts;","page_number":172,"box":{"x":68,"y":498,"width":772,"height":11}},{"id":"ce720cb2-b48a-464f-af98-474d09d1a290","block_type":"box","text":"(c) provides meaningful/insightful research notes on companies or other potential investments; (d) facilitates calls on","page_number":172,"box":{"x":69,"y":513,"width":838,"height":12}},{"id":"e1efceae-b427-4cb7-be76-5992208f7e93","block_type":"box","text":"which meaningful or insightful ideas about companies or potential investments are discussed; (e) facilitates","page_number":172,"box":{"x":68,"y":528,"width":769,"height":12}},{"id":"6204f60b-aca4-49ac-a423-650e44b5a73d","block_type":"box","text":"conferences at which meaningful or insightful ideas about companies or potential investments are discussed; or","page_number":172,"box":{"x":69,"y":543,"width":801,"height":12}},{"id":"f7e6f78e-3ae1-4bbc-809a-d199952543e0","block_type":"box","text":"(f) provides research tools such as market data, financial analysis, and other third-par ty related research and","page_number":172,"box":{"x":69,"y":559,"width":778,"height":11}},{"id":"762fbfb9-713a-45df-852e-a88e16f697c6","block_type":"box","text":"brokerage tools that aid in the investment process.","page_number":172,"box":{"x":69,"y":574,"width":363,"height":11}},{"id":"a5b79414-63d9-42f0-8fbf-93b50c9d41d2","block_type":"box","text":"Research-oriented services for which BlackRock, unless prohibited by applicable law, might pay with Fund","page_number":172,"box":{"x":102,"y":596,"width":749,"height":12}},{"id":"447c2a8b-82cf-4da7-9752-1ef07b26df71","block_type":"box","text":"commissions may be in written form or through direct contact with individuals and may include information as to","page_number":172,"box":{"x":69,"y":612,"width":799,"height":11}},{"id":"c4d7839f-3b62-4828-9dbd-f84f4301f71a","block_type":"box","text":"par ticular companies or industries and securities or groups of securities, as well as market, economic, or","page_number":172,"box":{"x":70,"y":627,"width":752,"height":11}},{"id":"ed1fefc9-220d-4c15-b80a-58a93bea919f","block_type":"box","text":"institutional advice and statistical information, political developments and technical market information that assists","page_number":172,"box":{"x":70,"y":642,"width":823,"height":11}},{"id":"8202c041-9c68-404c-af32-01e1b6510c2b","block_type":"box","text":"in the valuation of investments. Except as noted immediately below, research services furnished by brokers may be","page_number":172,"box":{"x":70,"y":657,"width":822,"height":11}},{"id":"52315685-4f14-4724-8780-2e3bf50824b5","block_type":"box","text":"used in servicing some or all client accounts and not all services may be used in connection with the Fund or account","page_number":172,"box":{"x":69,"y":672,"width":840,"height":11}},{"id":"9c2ee2bf-7700-43c7-8aa3-714725289568","block_type":"box","text":"that paid commissions to the broker providing such services. In some cases, research information received from","page_number":172,"box":{"x":68,"y":687,"width":805,"height":11}},{"id":"243f3e74-760d-4f40-b391-1c65a1221b16","block_type":"box","text":"brokers by mutual fund management personnel, or personnel principally responsible for BlackRock’s individually","page_number":172,"box":{"x":69,"y":702,"width":798,"height":12}},{"id":"e467b08b-deb8-4655-b27d-7537ba2aa90d","block_type":"box","text":"managed por tfolios, is not necessarily shared by and between such personnel. Any investment advisory or other fees","page_number":172,"box":{"x":69,"y":717,"width":836,"height":12}},{"id":"c4d8641c-cd9d-4112-9b21-977d5fdd67e3","block_type":"box","text":"paid by a Fund to BlackRock are not reduced as a result of BlackRock’s receipt of research services. In some cases,","page_number":172,"box":{"x":70,"y":732,"width":832,"height":12}},{"id":"013b4859-10f9-4c86-809c-bca50d3a0089","block_type":"box","text":"BlackRock may receive a service from a broker that has both a “research” and a “non-research” use. When this","page_number":172,"box":{"x":70,"y":748,"width":798,"height":11}},{"id":"378970b4-3d61-4db3-873b-f75736b19525","block_type":"box","text":"occurs BlackRock makes a good faith allocation, under all the circumstances, between the research and non","page_number":172,"box":{"x":69,"y":763,"width":780,"height":11}},{"id":"1ec6808b-1714-41de-8361-2d69188a564c","block_type":"box","text":"research uses of the service. The percentage of the service that is used for research purposes may be paid for with","page_number":172,"box":{"x":69,"y":778,"width":827,"height":11}},{"id":"4a060547-3e26-446e-9b8b-55491f80aced","block_type":"box","text":"client commissions, while BlackRock will use its own funds to pay for the percentage of the service that is used for","page_number":172,"box":{"x":69,"y":793,"width":821,"height":11}},{"id":"b833c866-241f-422c-b163-59e6aaaa91a0","block_type":"box","text":"non-research purposes. In making this good faith allocation, BlackRock faces a potential conflict of interest, but","page_number":172,"box":{"x":69,"y":808,"width":797,"height":11}},{"id":"46b7b6e8-c944-4abe-a4b6-e098522e5329","block_type":"box","text":"BlackRock believes that its allocation procedures are reasonably designed to ensure that it appropriately allocates","page_number":172,"box":{"x":70,"y":823,"width":815,"height":12}},{"id":"c2130fa7-ab2c-4966-90d1-251c117ff390","block_type":"box","text":"the anticipated use of such services to their research and non-research uses.","page_number":172,"box":{"x":68,"y":838,"width":555,"height":11}},{"id":"a3d40717-d65e-4e13-b88a-f269887398ef","block_type":"box","text":"Under MiFID II, investment managers in the EU, including BIL, are not able to use soft dollars to pay for research","page_number":172,"box":{"x":102,"y":861,"width":802,"height":11}},{"id":"56982def-73be-449c-83b4-959e187970c6","block_type":"box","text":"from brokers. Investment managers in the EU are required to either pay for research out of their own profit and loss","page_number":172,"box":{"x":68,"y":876,"width":825,"height":11}},{"id":"b9ff8462-5783-40a1-b55e-a9fd1007c85f","block_type":"box","text":"or agree with clients to have research costs paid by clients through research payment accounts that are directly","page_number":172,"box":{"x":69,"y":891,"width":798,"height":12}},{"id":"2cbd418e-ff49-43eb-a6f0-9d7d410d9fc2","block_type":"box","text":"funded or funded by a specific client research charge collected alongside execution commissions, provided that the","page_number":172,"box":{"x":68,"y":906,"width":824,"height":12}},{"id":"dc864e06-6a07-4ef3-b4ab-099138d0b41a","block_type":"box","text":"II-125","page_number":172,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"339575bb-96f4-4727-9994-0dfe42030c9e","block_type":"box","text":"NM1026U-6033063-172/246","page_number":172,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"2a9c3ab0-2735-497b-bb44-685e8cb1dedc","block_type":"box","text":"payments for research are unbundled from the payments for execution. BIL will pay for any research out of its own","page_number":173,"box":{"x":70,"y":45,"width":812,"height":11}},{"id":"2abe7646-9740-48bd-be98-edcf476f5983","block_type":"box","text":"resources and not through soft dollars or commission sharing arrangements.","page_number":173,"box":{"x":69,"y":60,"width":547,"height":11}},{"id":"ca9279ce-6dbd-4d2b-b12e-4de87597a376","block_type":"box","text":"Payments of commissions to brokers who are affiliated persons of the Fund, or the Master Por tfolio with respect","page_number":173,"box":{"x":102,"y":82,"width":804,"height":12}},{"id":"99c750f5-bce2-4fb1-9ee7-9e37387b29bd","block_type":"box","text":"to the Feeder Fund (or affiliated persons of such persons), will be made in accordance with Rule 17e-1 under the","page_number":173,"box":{"x":68,"y":98,"width":806,"height":11}},{"id":"2e415900-3cd6-4a95-80f8-308e8085109a","block_type":"box","text":"Investment Company Act. Subject to policies established by the Board of Directors of the Master Por tfolio, BlackRock","page_number":173,"box":{"x":70,"y":113,"width":836,"height":11}},{"id":"5a32d2bd-8b1a-4f34-be33-35c228c55c04","block_type":"box","text":"is primarily responsible for the execution of the Master Por tfolio’s por tfolio transactions and the allocation of","page_number":173,"box":{"x":70,"y":128,"width":777,"height":11}},{"id":"69d0996b-c8f7-430a-ba66-a03ae6be6c10","block_type":"box","text":"brokerage.","page_number":173,"box":{"x":69,"y":143,"width":74,"height":11}},{"id":"8286e33b-6ab1-4c0a-92c3-94b08a1713ea","block_type":"box","text":"From time to time, a Fund may purchase new issues of securities in a fixed price offering. In these situations,","page_number":173,"box":{"x":102,"y":166,"width":781,"height":11}},{"id":"591eb2da-f84f-4c8f-9abf-28167fdec538","block_type":"box","text":"the broker may be a member of the selling group that will, in addition to selling securities, provide BlackRock with","page_number":173,"box":{"x":68,"y":181,"width":810,"height":11}},{"id":"da712185-539a-4be5-aa34-f709992e49af","block_type":"box","text":"research services. FINRA has adopted rules expressly permitting these types of arrangements under cer tain","page_number":173,"box":{"x":69,"y":196,"width":771,"height":11}},{"id":"9d52ad9f-ae4c-48e4-b7df-199a1021f007","block_type":"box","text":"circumstances. Generally, the broker will provide research “credits” in these situations at a rate that is higher than","page_number":173,"box":{"x":69,"y":211,"width":818,"height":11}},{"id":"9c44db3b-a8f0-4502-b0bd-e83e367e1b2e","block_type":"box","text":"that available for typical secondary market transactions. These arrangements may not fall within the safe harbor of","page_number":173,"box":{"x":68,"y":226,"width":821,"height":11}},{"id":"3a658802-f633-4613-9c7f-8834362d6ac8","block_type":"box","text":"Section 28(e).","page_number":173,"box":{"x":69,"y":241,"width":99,"height":11}},{"id":"e80afa79-f410-422e-86be-f41c27ae5a5f","block_type":"box","text":"BlackRock does not consider sales of shares of the mutual funds it advises as a factor in the selection of","page_number":173,"box":{"x":102,"y":264,"width":755,"height":9}},{"id":"06f42607-1778-4171-84b3-eeec3c8c5ed0","block_type":"box","text":"brokers or dealers to execute por tfolio transactions for a Fund; however, whether or not a par ticular broker or dealer","page_number":173,"box":{"x":69,"y":279,"width":828,"height":11}},{"id":"22fd178a-efaa-4d03-8581-30c8c0a303fd","block_type":"box","text":"sells shares of the mutual funds advised by BlackRock neither qualifies nor disqualifies such broker or dealer to","page_number":173,"box":{"x":69,"y":294,"width":799,"height":11}},{"id":"19f3e95f-7320-4418-90aa-9188f7918e2f","block_type":"box","text":"execute transactions for those mutual funds.","page_number":173,"box":{"x":69,"y":309,"width":319,"height":9}},{"id":"3d0e4252-a0ad-4f29-94df-0b8f445903d0","block_type":"box","text":"Each Fund anticipates that its brokerage transactions involving foreign securities generally will be conducted","page_number":173,"box":{"x":102,"y":332,"width":770,"height":11}},{"id":"41e5d80e-58bd-46e6-aaf0-f645f6611ca7","block_type":"box","text":"primarily on the principal stock exchanges of the applicable country. Foreign equity securities may be held by a Fund","page_number":173,"box":{"x":70,"y":347,"width":825,"height":11}},{"id":"ca9c1594-6519-413b-a410-32be0f4abced","block_type":"box","text":"in the form of depositary receipts, or other securities conver tible into foreign equity securities. Depositary receipts","page_number":173,"box":{"x":70,"y":362,"width":816,"height":11}},{"id":"7ccd545d-cac8-45c3-bc6d-6b8bdac59d3f","block_type":"box","text":"may be listed on stock exchanges, or traded in OTC markets in the United States or Europe, as the case may be.","page_number":173,"box":{"x":69,"y":377,"width":805,"height":12}},{"id":"9ba04e76-6146-45a4-8d31-433d4239ccf6","block_type":"box","text":"American Depositary Receipts, like other securities traded in the United States, will be subject to negotiated","page_number":173,"box":{"x":68,"y":392,"width":773,"height":12}},{"id":"cf30df64-d66f-4972-8570-8f616b6f15aa","block_type":"box","text":"commission rates. Because the shares of each Fund are redeemable on a daily basis in U.S. dollars, each Fund","page_number":173,"box":{"x":69,"y":407,"width":798,"height":12}},{"id":"66a0101e-5bfa-4a61-b633-30da46aff477","block_type":"box","text":"intends to manage its por tfolio so as to give reasonable assurance that it will be able to obtain U.S. dollars to the","page_number":173,"box":{"x":70,"y":423,"width":812,"height":11}},{"id":"8d7caa94-5932-4af7-a55e-46f54df74cf2","block_type":"box","text":"extent necessary to meet anticipated redemptions. Under present conditions, it is not believed that these","page_number":173,"box":{"x":69,"y":438,"width":754,"height":11}},{"id":"1f5147c2-c5df-4152-86f7-7d38a6bf3468","block_type":"box","text":"considerations will have a significant effect on a Fund’s por tfolio strategies.","page_number":173,"box":{"x":69,"y":453,"width":540,"height":11}},{"id":"40b198d5-ad19-42ef-927d-9567d76b90c3","block_type":"box","text":"See “Por tfolio Transactions and Brokerage” in the SAI for information about the brokerage commissions paid by","page_number":173,"box":{"x":102,"y":475,"width":798,"height":12}},{"id":"2dfb03e6-b836-4632-bfd4-1c9ad58ad1f8","block_type":"box","text":"your Fund, including commissions paid to affiliates, if any, for the periods indicated.","page_number":173,"box":{"x":68,"y":491,"width":597,"height":11}},{"id":"8c1b8adc-ea26-4671-a40a-519db30f008f","block_type":"box","text":"Each Fund may invest in cer tain securities traded in the OTC market and intends to deal directly with the dealers","page_number":173,"box":{"x":102,"y":513,"width":802,"height":11}},{"id":"46160b47-71c4-4f10-980c-0675798a7336","block_type":"box","text":"who make a market in the par ticular securities, except in those circumstances in which better prices and execution","page_number":173,"box":{"x":68,"y":529,"width":822,"height":10}},{"id":"40637371-6144-4650-8b07-974b70cae1ed","block_type":"box","text":"are available elsewhere. Under the Investment Company Act, persons affiliated with a Fund and persons who are","page_number":173,"box":{"x":69,"y":543,"width":804,"height":12}},{"id":"4a445bb9-5e3e-42c6-aab2-d5d34f130de8","block_type":"box","text":"affiliated with such affiliated persons are prohibited from dealing with the Fund as principal in the purchase and sale","page_number":173,"box":{"x":69,"y":559,"width":832,"height":11}},{"id":"8892657b-8f02-4fdd-8059-f82ade726695","block_type":"box","text":"of securities unless a permissive order allowing such transactions is obtained from the Commission. Since","page_number":173,"box":{"x":69,"y":574,"width":762,"height":11}},{"id":"935572b7-bddd-48b0-b223-0debec1cbeeb","block_type":"box","text":"transactions in the OTC market usually involve transactions with the dealers acting as principal for their own","page_number":173,"box":{"x":68,"y":589,"width":770,"height":11}},{"id":"c9269c4f-4850-4347-b853-5b8f323dc9fa","block_type":"box","text":"accounts, the Funds will not deal with affiliated persons in connection with such transactions. However, an affiliated","page_number":173,"box":{"x":69,"y":604,"width":828,"height":11}},{"id":"190c885d-353a-4457-a789-4d0fb5602f25","block_type":"box","text":"person of a Fund may serve as its broker in OTC transactions conducted on an agency basis provided that, among","page_number":173,"box":{"x":70,"y":619,"width":814,"height":11}},{"id":"ce8c294c-cf36-4ac2-abbc-8907c75618df","block_type":"box","text":"other things, the fee or commission received by such affiliated broker is reasonable and fair compared to the fee or","page_number":173,"box":{"x":69,"y":634,"width":825,"height":12}},{"id":"c70c2541-e430-4220-beb2-70c59fbf7e38","block_type":"box","text":"commission received by non-affiliated brokers in connection with comparable transactions.","page_number":173,"box":{"x":69,"y":649,"width":645,"height":12}},{"id":"29319eed-e932-4d49-93ea-da79cd65889b","block_type":"box","text":"OTC issues, including most fixed-income securities such as corporate debt and U.S. Government Securities, are","page_number":173,"box":{"x":102,"y":672,"width":797,"height":11}},{"id":"38096d07-6f28-45aa-9a68-f01f4c8a8745","block_type":"box","text":"normally traded on a “net” basis without a stated commission, through dealers acting for their own account and not","page_number":173,"box":{"x":69,"y":687,"width":826,"height":11}},{"id":"b81f9002-4695-412b-b196-4a8b24857b5e","block_type":"box","text":"as brokers. The Funds will primarily engage in transactions with these dealers or deal directly with the issuer unless a","page_number":173,"box":{"x":69,"y":703,"width":839,"height":11}},{"id":"b60c780b-c8b3-4657-84e3-6ca681359367","block_type":"box","text":"better price or execution could be obtained by using a broker. Prices paid to a dealer with respect to both foreign and","page_number":173,"box":{"x":69,"y":717,"width":833,"height":12}},{"id":"d2417d97-9381-42a3-973b-9ea06d8aec5d","block_type":"box","text":"domestic securities will generally include a “spread,” which is the difference between the prices at which the dealer","page_number":173,"box":{"x":69,"y":732,"width":826,"height":12}},{"id":"95723eb3-f97e-4bcf-943f-b80a31daafdf","block_type":"box","text":"is willing to purchase and sell the specific security at the time, and includes the dealer’s normal profit.","page_number":173,"box":{"x":70,"y":748,"width":730,"height":11}},{"id":"7021c315-e5cf-430c-8765-bfc510b7e898","block_type":"box","text":"Purchases of money market instruments by a Fund are made from dealers, underwriters and issuers. The Funds","page_number":173,"box":{"x":102,"y":770,"width":800,"height":11}},{"id":"6d974356-ed09-4c55-90d1-feb96eaded99","block_type":"box","text":"do not currently expect to incur any brokerage commission expense on such transactions because money market","page_number":173,"box":{"x":69,"y":786,"width":807,"height":11}},{"id":"22d98f44-a5ad-411c-b0b9-f47d4e23a172","block_type":"box","text":"instruments are generally traded on a “net” basis with dealers acting as principal for their own accounts without a","page_number":173,"box":{"x":70,"y":801,"width":812,"height":11}},{"id":"9cb3c2cd-1831-40a9-98cd-f7187ab0739b","block_type":"box","text":"stated commission. The price of the security, however, usually includes a profit to the dealer. Each money market","page_number":173,"box":{"x":69,"y":816,"width":807,"height":11}},{"id":"2dad1dc9-3709-4228-ae5b-b538c1b7b7b2","block_type":"box","text":"fund intends to purchase only securities with remaining maturities of 397 days or less as determined in accordance","page_number":173,"box":{"x":68,"y":831,"width":827,"height":11}},{"id":"32b5df74-56c0-497d-add4-651b2f682c4e","block_type":"box","text":"with the rules of the Commission. As a result, the por tfolio turnover rates of a money market fund will be relatively","page_number":173,"box":{"x":68,"y":846,"width":817,"height":11}},{"id":"4b2bff41-abc1-4e97-9e2f-4bbe8b32b217","block_type":"box","text":"high. However, because brokerage commissions will not normally be paid with respect to investments made by a","page_number":173,"box":{"x":69,"y":861,"width":802,"height":11}},{"id":"d3c9e1f8-7ba9-41d8-87c5-b0b3a2a425c9","block_type":"box","text":"money market fund, the turnover rates should not adversely affect the Fund’s NAVs or net income.","page_number":173,"box":{"x":69,"y":876,"width":700,"height":11}},{"id":"622d0774-2a77-4258-a05f-dcdbc5e04c06","block_type":"box","text":"II-126","page_number":173,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"416797f5-ea5b-4699-a413-ee86a0ce2574","block_type":"box","text":"NM1026U-6033063-173/246","page_number":173,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"aa0a0116-3502-4aa8-aa26-5b5aca30cd3c","block_type":"box","text":"Securities purchased in underwritten offerings include a fixed amount of compensation to the underwriter,","page_number":174,"box":{"x":102,"y":45,"width":756,"height":11}},{"id":"83ad9252-6628-4d44-b3de-3a4f33043b0a","block_type":"box","text":"generally referred to as the underwriter’s concession or discount. When offered securities are purchased or sold","page_number":174,"box":{"x":68,"y":60,"width":804,"height":11}},{"id":"07a57fba-ab35-4a09-8ef3-700ff4558152","block_type":"box","text":"directly from or to an issuer, no commissions or discounts are paid except where required by local markets.","page_number":174,"box":{"x":69,"y":75,"width":766,"height":11}},{"id":"4bcaab25-7046-4ca4-81bb-fc98e46f3f4a","block_type":"box","text":"The Manager or sub-advisers may seek to obtain an under taking from issuers of commercial paper or dealers","page_number":174,"box":{"x":101,"y":98,"width":780,"height":11}},{"id":"bae48bcf-88b6-43bf-b1bd-3b842ea6700b","block_type":"box","text":"selling commercial paper to consider the repurchase of such securities from a Fund prior to maturity at their original","page_number":174,"box":{"x":69,"y":113,"width":826,"height":11}},{"id":"d95437ab-f483-4b81-8708-fb2caf12e175","block_type":"box","text":"cost plus interest (sometimes adjusted to reflect the actual maturity of the securities), if it believes that a Fund’s","page_number":174,"box":{"x":69,"y":128,"width":806,"height":11}},{"id":"df07ace7-182b-418e-b372-3af743a40f5c","block_type":"box","text":"anticipated need for liquidity makes such action desirable. Any such repurchase prior to maturity reduces the","page_number":174,"box":{"x":69,"y":143,"width":776,"height":11}},{"id":"d8ec5f65-e472-46e4-8f4b-4b5d84733e6f","block_type":"box","text":"possibility that a Fund would incur a capital loss in liquidating commercial paper, especially if interest rates have","page_number":174,"box":{"x":70,"y":158,"width":800,"height":11}},{"id":"af778df0-4d74-4a5c-b704-3447e61477ea","block_type":"box","text":"risen since acquisition of such commercial paper.","page_number":174,"box":{"x":69,"y":173,"width":352,"height":11}},{"id":"e81f6993-4add-4499-a99d-0e42900a4ca6","block_type":"box","text":"Investment decisions for each Fund and for other investment accounts managed by the Manager or sub-advisers","page_number":174,"box":{"x":102,"y":196,"width":800,"height":11}},{"id":"8e3c0e4b-04bd-47e8-b860-177eb65e5b7e","block_type":"box","text":"are made independently of each other in light of differing conditions. BlackRock allocates investments among client","page_number":174,"box":{"x":69,"y":211,"width":824,"height":11}},{"id":"ac20b8cf-6e24-495d-bbdc-695158347d95","block_type":"box","text":"accounts in a fair and equitable manner over time. A variety of factors will be considered in making such allocations.","page_number":174,"box":{"x":69,"y":226,"width":828,"height":11}},{"id":"6fa8c6b7-0e81-4cf7-a4d9-30dde85ef3ed","block_type":"box","text":"These factors include: (i) investment objectives or strategies for par ticular accounts, including sector, industry,","page_number":174,"box":{"x":68,"y":241,"width":788,"height":11}},{"id":"c09f6721-4ba3-4bdf-89e9-9bd8bcab4954","block_type":"box","text":"country or region and capitalization weightings, (ii) tax considerations of an account, (iii) risk or investment","page_number":174,"box":{"x":69,"y":256,"width":759,"height":12}},{"id":"b69f25fc-a687-4337-9164-d8b3e53e829d","block_type":"box","text":"concentration parameters for an account, (iv) supply or demand for a security at a given price level, (v) size of","page_number":174,"box":{"x":69,"y":271,"width":780,"height":12}},{"id":"d5f5f3b9-ea1c-4c6c-a789-20097060be77","block_type":"box","text":"available investment, (vi) cash availability and liquidity requirements for accounts, (vii) regulatory restrictions,","page_number":174,"box":{"x":69,"y":286,"width":777,"height":12}},{"id":"181e5e90-af32-48f4-bf1b-bdc23eead49e","block_type":"box","text":"(viii) minimum investment size of an account, (ix) relative size of account, and (x) such other factors as may be","page_number":174,"box":{"x":69,"y":302,"width":788,"height":11}},{"id":"4e478278-6a34-4160-9643-ba6acd11f329","block_type":"box","text":"approved by BlackRock’s general counsel. Moreover, investments may not be allocated to one client account over","page_number":174,"box":{"x":69,"y":317,"width":811,"height":11}},{"id":"698b7177-5184-48ad-abf0-b02e9fc90633","block_type":"box","text":"another based on any of the following considerations: (i) to favor one client account at the expense of another, (ii) to","page_number":174,"box":{"x":69,"y":332,"width":829,"height":11}},{"id":"63b89682-b8b1-44cf-9cfa-f90f63d512da","block_type":"box","text":"generate higher fees paid by one client account over another or to produce greater per formance compensation to","page_number":174,"box":{"x":68,"y":347,"width":808,"height":11}},{"id":"6e57f952-2465-4619-80c1-dd52b2bfa388","block_type":"box","text":"BlackRock, (iii) to develop or enhance a relationship with a client or prospective client, (iv) to compensate a client for","page_number":174,"box":{"x":70,"y":362,"width":832,"height":11}},{"id":"3468873a-33ce-4233-a748-2977f54ea4ab","block_type":"box","text":"past services or benefits rendered to BlackRock or to induce future services or benefits to be rendered to BlackRock,","page_number":174,"box":{"x":70,"y":377,"width":836,"height":11}},{"id":"1ffe62d8-e787-48fb-80df-681ecd008a9d","block_type":"box","text":"or (v) to manage or equalize investment per formance among different client accounts.","page_number":174,"box":{"x":69,"y":392,"width":613,"height":12}},{"id":"bb8a78b4-24e8-44f0-8330-3f70eb5faad3","block_type":"box","text":"Equity securities will generally be allocated among client accounts within the same investment mandate on a pro","page_number":174,"box":{"x":102,"y":415,"width":802,"height":11}},{"id":"d8cab9b1-ff3a-4eb4-9e60-89b85e8c09f8","block_type":"box","text":"rata basis. All allocations of equity securities will be subject, where relevant, to share minimums established for","page_number":174,"box":{"x":69,"y":430,"width":800,"height":11}},{"id":"bda11dcd-b6fc-421e-9d97-3ea6a6541627","block_type":"box","text":"accounts and compliance constraints.","page_number":174,"box":{"x":69,"y":446,"width":269,"height":10}},{"id":"61eedb2d-d2ac-442a-bdc0-2ef54f9ad61d","block_type":"box","text":"Initial public offerings of securities may be over-subscribed and subsequently trade at a premium in the","page_number":174,"box":{"x":102,"y":468,"width":736,"height":11}},{"id":"1cd6facd-4f2c-4ccb-bf78-3933ddd5c51f","block_type":"box","text":"secondary market. In these situations, the supply of securities available for client accounts is often less than the","page_number":174,"box":{"x":69,"y":483,"width":808,"height":11}},{"id":"35ea275e-8e2c-4e87-a5d8-805516af8f58","block_type":"box","text":"amount of securities the accounts would otherwise take. In order to allocate these investments fairly and equitably","page_number":174,"box":{"x":69,"y":498,"width":821,"height":11}},{"id":"e28d7951-2d38-49df-a7a8-f19154523fdd","block_type":"box","text":"among client accounts over time, each por tfolio manager or a member of his or her respective investment team will","page_number":174,"box":{"x":69,"y":513,"width":823,"height":12}},{"id":"4bdbcbe1-4da2-43af-8b1b-bb1a7dfe50fe","block_type":"box","text":"indicate to BlackRock’s trading desk their level of interest in a par ticular offering with respect to eligible client","page_number":174,"box":{"x":70,"y":528,"width":783,"height":12}},{"id":"5375e5ce-8c2d-43e6-b4b7-1d243df21ae5","block_type":"box","text":"accounts for which that team is responsible. Initial public offerings of U.S. equity securities will be identified as","page_number":174,"box":{"x":69,"y":543,"width":793,"height":12}},{"id":"85bf7b1c-98a6-431e-a72a-10dd0ada2bf5","block_type":"box","text":"eligible for par ticular client accounts that are managed by por tfolio teams who have indicated interest in the offering","page_number":174,"box":{"x":69,"y":559,"width":831,"height":11}},{"id":"4c9d7038-64f7-4ea2-b83f-3cfc771ebcc3","block_type":"box","text":"based on market capitalization of the issuer of the security and the investment mandate of the client account and in","page_number":174,"box":{"x":69,"y":574,"width":828,"height":11}},{"id":"6c254ccc-20f6-4417-a55b-7bb4bc01899b","block_type":"box","text":"the case of international equity securities, the country where the offering is taking place and the investment mandate","page_number":174,"box":{"x":68,"y":589,"width":839,"height":11}},{"id":"aeea127f-eb7a-42d1-bd80-80bafed36b0b","block_type":"box","text":"of the client account. Generally, shares received during the initial public offering will be allocated among par ticipating","page_number":174,"box":{"x":69,"y":604,"width":835,"height":11}},{"id":"92b66073-53d1-4f9c-94df-17fbec695b4f","block_type":"box","text":"client accounts within each investment mandate on a pro rata basis. In situations where supply is too limited to be","page_number":174,"box":{"x":69,"y":619,"width":819,"height":11}},{"id":"b0aee368-1344-42e1-ada0-d4e6b2187daf","block_type":"box","text":"allocated among all accounts for which the investment is eligible, por tfolio managers may rotate such investment","page_number":174,"box":{"x":69,"y":634,"width":808,"height":12}},{"id":"a67b4a7f-bf54-44b9-906e-8769cd38b47d","block_type":"box","text":"oppor tunities among one or more accounts so long as the rotation system provides for fair access for all client","page_number":174,"box":{"x":69,"y":649,"width":791,"height":12}},{"id":"c233153f-1767-41e6-a470-6c4918b92318","block_type":"box","text":"accounts over time. Other allocation methodologies that are considered by BlackRock to be fair and equitable to","page_number":174,"box":{"x":69,"y":664,"width":799,"height":12}},{"id":"fe1a0611-0d2d-4edc-b64c-5f64ed02f2cd","block_type":"box","text":"clients may be used as well.","page_number":174,"box":{"x":69,"y":680,"width":200,"height":11}},{"id":"8b8a12b4-417f-4ac1-921b-39ce2e524bc0","block_type":"box","text":"Because different accounts may have differing investment objectives and policies, BlackRock may buy and sell","page_number":174,"box":{"x":102,"y":702,"width":789,"height":12}},{"id":"7d169709-786d-4bcc-9bb6-bf5f38b89b80","block_type":"box","text":"the same securities at the same time for different clients based on the par ticular investment objective, guidelines","page_number":174,"box":{"x":68,"y":717,"width":815,"height":12}},{"id":"9c083eaf-d74b-403f-a3c4-eb914bbd856d","block_type":"box","text":"and strategies of those accounts. For example, BlackRock may decide that it may be entirely appropriate for a growth","page_number":174,"box":{"x":69,"y":732,"width":835,"height":12}},{"id":"ed33324b-800a-422e-aa08-429e48985bda","block_type":"box","text":"fund to sell a security at the same time a value fund is buying that security. To the extent that transactions on behalf","page_number":174,"box":{"x":68,"y":748,"width":833,"height":11}},{"id":"22ec4f83-33c6-44ad-aeef-8353ebe7459b","block_type":"box","text":"of more than one client of BlackRock or its affiliates during the same period may increase the demand for securities","page_number":174,"box":{"x":69,"y":763,"width":829,"height":11}},{"id":"30808ec3-5506-44ff-9e2b-2a289ff2f1f4","block_type":"box","text":"being purchased or the supply of securities being sold, there may be an adverse effect on price. For example, sales","page_number":174,"box":{"x":69,"y":778,"width":825,"height":11}},{"id":"b0813776-41b4-4fe4-a0c5-d7eb1767eb99","block_type":"box","text":"of a security by BlackRock on behalf of one or more of its clients may decrease the market price of such security,","page_number":174,"box":{"x":69,"y":793,"width":806,"height":11}},{"id":"816afe65-7e63-404b-ab16-87b7eb57d647","block_type":"box","text":"adversely impacting other BlackRock clients that still hold the security. If purchases or sales of securities arise for","page_number":174,"box":{"x":69,"y":808,"width":814,"height":11}},{"id":"bb3fea06-1c48-457a-afae-51bd4c82df8f","block_type":"box","text":"consideration at or about the same time that would involve a Fund or other clients or funds for which BlackRock or an","page_number":174,"box":{"x":69,"y":823,"width":836,"height":9}},{"id":"ff0d17a1-2e61-4feb-aa29-9f72e4fc505d","block_type":"box","text":"affiliate act as investment manager, transactions in such securities will be made, insofar as feasible, for the","page_number":174,"box":{"x":69,"y":838,"width":773,"height":12}},{"id":"15a5ca88-b726-4d6b-b9f9-2318ca1be767","block_type":"box","text":"respective funds and clients in a manner deemed equitable to all.","page_number":174,"box":{"x":69,"y":853,"width":467,"height":11}},{"id":"c6e1605f-6a09-44c8-a91b-163072daf13a","block_type":"box","text":"In cer tain instances, BlackRock may find it efficient for purposes of seeking to obtain best execution, to","page_number":174,"box":{"x":102,"y":876,"width":741,"height":11}},{"id":"fd8ed2f5-ff0a-4fe0-84a6-e8ec9c31c775","block_type":"box","text":"aggregate cer tain contemporaneous purchases or sale orders of its advisory accounts. In general, all","page_number":174,"box":{"x":69,"y":891,"width":721,"height":12}},{"id":"0bef39fa-253e-449e-81a5-af601b5e9e41","block_type":"box","text":"contemporaneous trades for client accounts under management by the same por tfolio manager or investment team","page_number":174,"box":{"x":69,"y":906,"width":824,"height":12}},{"id":"a4922bd5-242f-44fa-9d63-5e87157c0d05","block_type":"box","text":"II-127","page_number":174,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"ff4e82d3-a15f-487a-9bfb-8e0b9af495ce","block_type":"box","text":"NM1026U-6033063-174/246","page_number":174,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"ec063193-b23a-4577-8392-0af40cc55116","block_type":"box","text":"will be aggregated in a single order if the trader believes the aggregated trade would provide each client with an","page_number":175,"box":{"x":68,"y":45,"width":795,"height":11}},{"id":"2eaa9c82-b48f-468f-886e-ba51dfd5abaf","block_type":"box","text":"oppor tunity to achieve a more favorable execution at a potentially lower execution cost. The costs associated with an","page_number":175,"box":{"x":69,"y":60,"width":834,"height":11}},{"id":"5b7a5c55-8660-447c-8b82-a829cda34e4f","block_type":"box","text":"aggregated order will be shared pro rata among the clients in the aggregated order. Generally, if an order for a","page_number":175,"box":{"x":69,"y":75,"width":783,"height":11}},{"id":"a5a1d9e0-8412-4b22-8aa9-45c43b1546fe","block_type":"box","text":"par ticular por tfolio manager or management team is filled at several different prices through multiple trades, all","page_number":175,"box":{"x":70,"y":90,"width":796,"height":11}},{"id":"7c5f7c61-1ea5-4908-8737-d3cbba1d309a","block_type":"box","text":"accounts par ticipating in the order will receive the average price except in the case of cer tain international markets","page_number":175,"box":{"x":69,"y":105,"width":821,"height":11}},{"id":"44d431a4-8667-45b0-a53b-4a2968b8d838","block_type":"box","text":"where average pricing is not permitted. While in some cases this practice could have a detrimental effect upon the","page_number":175,"box":{"x":68,"y":120,"width":819,"height":12}},{"id":"9d8803fa-3a17-417f-b902-89b9113673ed","block_type":"box","text":"price or value of the security as far as a Fund is concerned, in other cases it could be beneficial to the Fund.","page_number":175,"box":{"x":70,"y":135,"width":771,"height":11}},{"id":"60b48f10-16bb-47e4-b694-ed18161b1d3c","block_type":"box","text":"Transactions effected by BlackRock on behalf of more than one of its clients during the same period may increase","page_number":175,"box":{"x":68,"y":150,"width":815,"height":12}},{"id":"1e23cdc8-9fc1-4194-80a0-f6be5d292f85","block_type":"box","text":"the demand for securities being purchased or the supply of securities being sold, causing an adverse effect on price.","page_number":175,"box":{"x":68,"y":166,"width":835,"height":11}},{"id":"370e763a-d78d-49a0-8d1a-29d73bd4b753","block_type":"box","text":"The trader will give the aggregated order to the broker-dealer that the trader has identified as being able to provide","page_number":175,"box":{"x":68,"y":181,"width":817,"height":11}},{"id":"bb2175f2-ba47-479b-b7ac-f5af398e5a6e","block_type":"box","text":"the best execution of the order. Orders for purchase or sale of securities will be placed within a reasonable amount","page_number":175,"box":{"x":68,"y":196,"width":823,"height":11}},{"id":"5afd07c8-88e0-4bc0-b662-0a663c7a2bb0","block_type":"box","text":"of time of the order receipt and aggregated orders will be kept aggregated only long enough to execute the order.","page_number":175,"box":{"x":69,"y":211,"width":803,"height":11}},{"id":"52cfbcd7-cf77-4c5a-bd29-cac401d53110","block_type":"box","text":"A Fund will not purchase securities during the existence of any underwriting or selling group relating to such","page_number":175,"box":{"x":101,"y":234,"width":767,"height":11}},{"id":"9c4e8a69-2a82-4193-beeb-a3ae40f199f8","block_type":"box","text":"securities of which BlackRock, BRIL or any affiliated person (as defined in the Investment Company Act) thereof is a","page_number":175,"box":{"x":69,"y":249,"width":826,"height":11}},{"id":"2d7e3cb4-6818-4ddb-99b1-748a0074c6a3","block_type":"box","text":"member except pursuant to procedures adopted by the Board of Directors in accordance with Rule 10f-3 under the","page_number":175,"box":{"x":69,"y":264,"width":816,"height":11}},{"id":"3b03c68d-3e2c-42aa-b83e-fb1a619086bd","block_type":"box","text":"Investment Company Act. In no instance will por tfolio securities be purchased from or sold to BlackRock, BRIL or any","page_number":175,"box":{"x":70,"y":279,"width":833,"height":11}},{"id":"6ed8ee0c-b10e-434d-99b4-d7401b355258","block_type":"box","text":"affiliated person of the foregoing entities except as permitted by Commission exemptive order or by applicable law.","page_number":175,"box":{"x":69,"y":294,"width":818,"height":11}},{"id":"5a2047f7-5f1d-439d-8339-f60207436623","block_type":"box","text":"A Fund’s purchase and sale orders for securities may be combined with those of other investment companies,","page_number":175,"box":{"x":101,"y":317,"width":786,"height":11}},{"id":"b1cce5dc-d5f3-4e5b-8388-2d603bcd5deb","block_type":"box","text":"clients or accounts that BlackRock manages or advises. If purchases or sales of por tfolio securities of a Fund and","page_number":175,"box":{"x":69,"y":332,"width":814,"height":11}},{"id":"1bbc0a2d-73f7-4b52-a284-8f0d80742198","block_type":"box","text":"one or more other accounts managed or advised by BlackRock are considered at or about the same time,","page_number":175,"box":{"x":69,"y":347,"width":751,"height":11}},{"id":"4e014de9-516d-4333-b31b-ee4df6bcabc9","block_type":"box","text":"transactions in such securities are allocated among the Fund and the other accounts in a manner deemed equitable","page_number":175,"box":{"x":68,"y":362,"width":829,"height":11}},{"id":"c655c2fd-782c-4e3d-bf5a-9850cdb08e2a","block_type":"box","text":"to all by BlackRock. In some cases, this procedure could have a detrimental effect on the price or volume of the","page_number":175,"box":{"x":68,"y":377,"width":799,"height":11}},{"id":"db3e4c54-f2f2-4544-8589-d294925fcf99","block_type":"box","text":"security as far as a Fund is concerned. However, in other cases, it is possible that the ability to par ticipate in volume","page_number":175,"box":{"x":69,"y":392,"width":834,"height":12}},{"id":"c5150b88-c561-4987-a358-242f24aba7b7","block_type":"box","text":"transactions and to negotiate lower transaction costs will be beneficial to the Fund. BlackRock may deal, trade and","page_number":175,"box":{"x":68,"y":407,"width":820,"height":12}},{"id":"44c00dfe-a1f6-44e1-90ae-47a03b8e5308","block_type":"box","text":"invest for its own account in the types of securities in which a Fund may invest. BlackRock may, from time to time,","page_number":175,"box":{"x":70,"y":423,"width":812,"height":11}},{"id":"88b6eed8-8ce3-4695-ac5d-12027d0c590c","block_type":"box","text":"effect trades on behalf of and for the account of a Fund with brokers or dealers that are affiliated with BFA, in","page_number":175,"box":{"x":69,"y":438,"width":781,"height":10}},{"id":"7643c548-879c-4083-8e60-789f3173c71b","block_type":"box","text":"conformity with the Investment Company Act and Commission rules and regulations. Under these provisions, any","page_number":175,"box":{"x":69,"y":453,"width":805,"height":11}},{"id":"5415fbb7-4ce3-4cb4-a583-6db28d81ba36","block_type":"box","text":"commissions paid to affiliated brokers or dealers must be reasonable and fair compared to the commissions charged","page_number":175,"box":{"x":69,"y":468,"width":840,"height":11}},{"id":"71c3141d-f720-4233-8b58-bc8f70816fee","block_type":"box","text":"by other brokers or dealers in comparable transactions. A Fund will not deal with affiliates in principal transactions","page_number":175,"box":{"x":69,"y":483,"width":815,"height":11}},{"id":"91f0febe-4051-4823-9a46-4e8e3d2429f4","block_type":"box","text":"unless permitted by applicable Commission rules or regulations, or by Commission exemptive order.","page_number":175,"box":{"x":69,"y":498,"width":713,"height":11}},{"id":"9ad83987-ff9e-4f67-bf6a-37477134f14f","block_type":"box","text":"Portfolio Turnover","page_number":175,"box":{"x":69,"y":528,"width":129,"height":9}},{"id":"28f06ad8-d170-4649-8c75-fc779c7523f6","block_type":"box","text":"The por tfolio turnover rate is calculated by dividing the lesser of a Fund’s annual sales or purchases of por tfolio","page_number":175,"box":{"x":101,"y":551,"width":798,"height":11}},{"id":"9e17ef64-11df-4281-a31a-be81560392c5","block_type":"box","text":"securities (exclusive of purchases or sales of U.S. Government Securities and all other securities whose maturities at","page_number":175,"box":{"x":69,"y":566,"width":839,"height":11}},{"id":"080b1159-eb64-4805-b4f8-03af7b17910f","block_type":"box","text":"the time of acquisition were one year or less) by the monthly average value of the securities in the por tfolio during","page_number":175,"box":{"x":68,"y":581,"width":814,"height":12}},{"id":"cebd3276-1790-4c2e-b11e-c36a1ef1bbe7","block_type":"box","text":"the year. A high rate of por tfolio turnover results in cer tain tax consequences, such as increased capital gain","page_number":175,"box":{"x":68,"y":596,"width":777,"height":12}},{"id":"e0afbf9f-7d20-4010-bbda-b89c69c37138","block_type":"box","text":"dividends and/or ordinary income dividends, and in correspondingly greater transaction costs in the form of dealer","page_number":175,"box":{"x":69,"y":612,"width":818,"height":11}},{"id":"5564ae1f-449c-47bc-afcb-18cb348f09f5","block_type":"box","text":"spreads and brokerage commissions, which are borne directly by a Fund.","page_number":175,"box":{"x":69,"y":627,"width":519,"height":11}},{"id":"10212911-64e3-4e20-816f-b4dda64c3ba5","block_type":"box","text":"DIVIDENDS AND TAXES","page_number":175,"box":{"x":396,"y":656,"width":186,"height":10}},{"id":"b72f1805-6c9b-47cd-a19a-944468e2a4eb","block_type":"box","text":"Dividends","page_number":175,"box":{"x":69,"y":687,"width":69,"height":9}},{"id":"a79b6379-7029-4749-a840-62b149af3d61","block_type":"box","text":"Each Fund intends to distribute substantially all of its net investment income, if any. Dividends from such net","page_number":175,"box":{"x":102,"y":709,"width":776,"height":11}},{"id":"dbaf372a-5641-47b6-93d5-8c6d60855803","block_type":"box","text":"investment income are paid as set for th in each Fund’s Prospectus. Each Fund also intends to distribute all net","page_number":175,"box":{"x":70,"y":724,"width":795,"height":11}},{"id":"961c41f7-9873-44ac-ab38-21995cb1ba2f","block_type":"box","text":"realized capital gains, if any, as set for th in such Fund’s Prospectus. From time to time, a Fund may declare a special","page_number":175,"box":{"x":69,"y":739,"width":837,"height":12}},{"id":"b96abd31-1991-4c94-bbb2-5e6534029ff0","block_type":"box","text":"distribution at or about the end of the calendar year in order to comply with U.S. federal tax requirements that cer tain","page_number":175,"box":{"x":69,"y":755,"width":836,"height":11}},{"id":"f4542469-3d89-4fd3-a434-21e2e0454f41","block_type":"box","text":"percentages of its ordinary income and capital gains be distributed during the year. If, in any fiscal year, a Fund has","page_number":175,"box":{"x":70,"y":770,"width":822,"height":11}},{"id":"5f1a1f92-b6d1-42ba-b9af-fac846a53091","block_type":"box","text":"net income from cer tain foreign currency transactions, such income will be distributed at least annually.","page_number":175,"box":{"x":69,"y":785,"width":739,"height":11}},{"id":"b0cef6e9-971a-488f-904c-04e47eef217b","block_type":"box","text":"For information concerning the manner in which dividends may be reinvested automatically in shares of each","page_number":175,"box":{"x":102,"y":807,"width":773,"height":12}},{"id":"e9e9f720-4c47-4239-8f86-77efea042be3","block_type":"box","text":"Fund, as applicable, see “Shareholder Services — Automatic Dividend Reinvestment Plan.” Shareholders may also","page_number":175,"box":{"x":70,"y":823,"width":819,"height":11}},{"id":"46ea45ac-bee5-4346-b880-a8661604e5ee","block_type":"box","text":"elect in writing to receive any such dividends in cash. Dividends are taxable to shareholders, as discussed below,","page_number":175,"box":{"x":69,"y":838,"width":807,"height":11}},{"id":"f7b89c29-b1e3-4f5e-9917-fee882792508","block_type":"box","text":"whether they are reinvested in shares of the Fund or received in cash. The per share dividends on front-end load","page_number":175,"box":{"x":68,"y":853,"width":800,"height":11}},{"id":"7ae0a0da-9894-428a-9dbd-cc06ff5ea1bf","block_type":"box","text":"shares, CDSC shares and Service Shares will be lower than the per share dividends on Institutional Shares as a","page_number":175,"box":{"x":69,"y":868,"width":801,"height":11}},{"id":"5d8ae62d-476f-4d20-9b00-2232d6bf1dfd","block_type":"box","text":"result of the service, distribution and higher transfer agency fees applicable to CDSC shares, the service fees","page_number":175,"box":{"x":69,"y":883,"width":783,"height":11}},{"id":"11721993-05f8-41aa-ae6b-64ffb14ab022","block_type":"box","text":"applicable to front-end load shares and Service Shares, and the service and distribution fees applicable to Class R","page_number":175,"box":{"x":69,"y":898,"width":820,"height":11}},{"id":"a09800db-7fd5-4485-badb-74653d801af9","block_type":"box","text":"II-128","page_number":175,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"c32ef886-dbc0-41a2-a14c-1a9e7153af94","block_type":"box","text":"NM1026U-6033063-175/246","page_number":175,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"8f806ab7-7517-492b-addf-dc7ed90ce7c7","block_type":"box","text":"Shares. Similarly, the per share dividends on CDSC shares and Class R Shares will be lower than the per share","page_number":176,"box":{"x":69,"y":45,"width":794,"height":11}},{"id":"5817fde3-f0ea-4834-abca-1e2f7bc54f42","block_type":"box","text":"dividends on front-end load shares and Service Shares as a result of the distribution fees and higher transfer agency","page_number":176,"box":{"x":69,"y":60,"width":834,"height":11}},{"id":"01af693a-c6b8-4576-b400-5a646fba55ec","block_type":"box","text":"fees applicable to CDSC shares and the distribution fees applicable to Class R Shares, and the per share dividends","page_number":176,"box":{"x":68,"y":75,"width":826,"height":11}},{"id":"b35696c2-4798-4340-9f79-cfeca69e9131","block_type":"box","text":"on CDSC shares will be lower than the per share dividends on Class R Shares as a result of the higher distribution","page_number":176,"box":{"x":69,"y":90,"width":816,"height":11}},{"id":"b4bbe1a7-f954-4b12-b97b-eeea28e058fa","block_type":"box","text":"fees and higher transfer agency fees applicable to CDSC shares.","page_number":176,"box":{"x":68,"y":105,"width":461,"height":11}},{"id":"541071b0-a650-4789-a67d-0d47cbabda27","block_type":"box","text":"Taxes","page_number":176,"box":{"x":68,"y":136,"width":42,"height":8}},{"id":"c367549f-f58d-43eb-b6db-228b06427790","block_type":"box","text":"Each Fund intends to continue to qualify for the special tax treatment afforded to regulated investment","page_number":176,"box":{"x":102,"y":158,"width":732,"height":11}},{"id":"d442175a-4770-43ae-9b03-3811728e2242","block_type":"box","text":"companies under the Code. As long as a Fund so qualifies, the Fund (but not its shareholders) will not be subject to","page_number":176,"box":{"x":69,"y":173,"width":825,"height":11}},{"id":"f7db179f-5c54-4bc0-9c5f-e40b5fae70f4","block_type":"box","text":"U.S. federal income tax on the par t of its investment company taxable income and net realized capital gains that it","page_number":176,"box":{"x":70,"y":188,"width":817,"height":12}},{"id":"15f00e65-61f9-4cfc-b1ae-3a6af719ab5a","block_type":"box","text":"distributes to its shareholders in years in which it distributes at least 90% of its investment company taxable income","page_number":176,"box":{"x":69,"y":203,"width":832,"height":12}},{"id":"d5c69960-64fe-47c9-849b-5bc694417ed4","block_type":"box","text":"and at least 90% of its net tax-exempt interest income, if any, for the year. To qualify as a regulated investment","page_number":176,"box":{"x":69,"y":218,"width":791,"height":12}},{"id":"4209d8d2-a753-44d7-80ad-a4b40e7dad27","block_type":"box","text":"company, a Fund must meet cer tain requirements regarding the source of its income and the composition and","page_number":176,"box":{"x":69,"y":234,"width":786,"height":11}},{"id":"cc9a6bc7-5a70-4b3e-97f1-d4c3bdb63f47","block_type":"box","text":"diversification of its assets. See Par t II, “Investment Risks and Considerations—Investment Restrictions (All Funds)”","page_number":176,"box":{"x":69,"y":249,"width":831,"height":11}},{"id":"6272e732-bfd0-43f6-90cd-f5f85fdec72a","block_type":"box","text":"for a discussion of the asset diversification requirements. In the case of a Feeder Fund, such Fund may look to the","page_number":176,"box":{"x":68,"y":264,"width":819,"height":11}},{"id":"e0b889c0-6f23-49b5-a1d7-990ad249ef1a","block_type":"box","text":"underlying assets of the Master Por tfolio in which it has invested for purposes of satisfying the asset diversification","page_number":176,"box":{"x":69,"y":279,"width":824,"height":11}},{"id":"2d970c5a-3f9c-4009-994a-044579b65d69","block_type":"box","text":"requirement and various other requirements of the Code applicable to regulated investment companies.","page_number":176,"box":{"x":69,"y":294,"width":739,"height":11}},{"id":"a8d97613-5a04-4751-827b-6cb43d00b499","block_type":"box","text":"A Fund may be able to cure a failure to derive at least 90% of its income from the sources specified above or a","page_number":176,"box":{"x":101,"y":317,"width":792,"height":11}},{"id":"902b39dd-0a50-4179-863f-0732d953b457","block_type":"box","text":"failure to diversify its holdings in the manner described above by paying a tax, by disposing of cer tain assets, or by","page_number":176,"box":{"x":68,"y":332,"width":819,"height":11}},{"id":"630b7415-cc90-485e-b5fd-5b7215593331","block_type":"box","text":"paying a tax and disposing of assets. If, in any taxable year, a Fund fails one of these tests and does not timely cure","page_number":176,"box":{"x":70,"y":347,"width":830,"height":11}},{"id":"6b93ce6b-a074-41df-b89a-944ddab10998","block_type":"box","text":"the failure, the Fund will be taxed in the same manner as an ordinary corporation and distributions to its","page_number":176,"box":{"x":68,"y":362,"width":744,"height":11}},{"id":"4027c35a-7da9-4a2e-bba2-1cc47cb7c609","block_type":"box","text":"shareholders will not be deductible by the Fund in computing its taxable income. Although in general the passive loss","page_number":176,"box":{"x":69,"y":377,"width":835,"height":12}},{"id":"6aaf7748-c368-49a4-b7c6-534e3d01eb7b","block_type":"box","text":"rules of the Code do not apply to regulated investment companies, such rules do apply to a regulated investment","page_number":176,"box":{"x":69,"y":392,"width":808,"height":12}},{"id":"1612838e-7277-4ea2-911c-0d32dc6111cc","block_type":"box","text":"company with respect to items attributable to an interest in a qualified publicly-traded par tnership. A Fund’s","page_number":176,"box":{"x":69,"y":407,"width":767,"height":12}},{"id":"772c19c6-9744-4bbc-90c9-168b6bf0d369","block_type":"box","text":"investments in par tnerships, including in qualified publicly-traded par tnerships, may result in the Fund being subject","page_number":176,"box":{"x":70,"y":423,"width":826,"height":11}},{"id":"05c4c4b0-4ff3-4d5a-83c7-e74ffaa06a7e","block_type":"box","text":"to state, local, or non-U.S. income, franchise or withholding tax liabilities.","page_number":176,"box":{"x":68,"y":438,"width":521,"height":11}},{"id":"7e139a7a-bdea-4f41-bbbe-2b1124df152d","block_type":"box","text":"Each Fund intends to distribute substantially all of such income and gains. If, in any taxable year, a Fund fails to","page_number":176,"box":{"x":102,"y":460,"width":798,"height":12}},{"id":"cc859f5f-3ae3-4791-b72a-d654e009f953","block_type":"box","text":"qualify as a regulated investment company under the Code, notwithstanding the availability of cer tain relief","page_number":176,"box":{"x":69,"y":475,"width":762,"height":12}},{"id":"0a703267-1ebc-4663-98db-7f8b5a0e36ff","block_type":"box","text":"provisions, such Fund would be taxed in the same manner as an ordinary corporation and all distributions from","page_number":176,"box":{"x":70,"y":491,"width":789,"height":11}},{"id":"72b782d1-ec1d-4470-8b36-4e00b3befd67","block_type":"box","text":"earnings and profits (as determined under U.S. federal income tax principles) to its shareholders would be taxable as","page_number":176,"box":{"x":69,"y":506,"width":837,"height":11}},{"id":"b6d99dbb-af20-4d50-a3e7-2dae2cbc3b36","block_type":"box","text":"ordinary dividend income eligible for taxation at a reduced tax rate for non-corporate shareholders and the dividends","page_number":176,"box":{"x":69,"y":521,"width":831,"height":11}},{"id":"c701ffb8-3362-4a9a-9aed-d1988c19097c","block_type":"box","text":"received deduction for corporate shareholders. However, a Municipal Fund’s distributions derived from income on tax","page_number":176,"box":{"x":69,"y":536,"width":837,"height":11}},{"id":"27db3df7-2db2-4c4d-a475-a089ab0e4e21","block_type":"box","text":"exempt obligations, as defined herein, would no longer qualify for treatment as exempt interest. Each Fund that is a","page_number":176,"box":{"x":69,"y":551,"width":825,"height":11}},{"id":"12d6d337-6687-42f8-8a96-f150e3b01e64","block_type":"box","text":"series of a regulated investment company that consists of multiple series is treated as a separate corporation for","page_number":176,"box":{"x":69,"y":566,"width":811,"height":11}},{"id":"e9865be6-8507-4052-b99d-64c74fc1367b","block_type":"box","text":"U.S. federal income tax purposes, and therefore is considered to be a separate entity in determining its treatment","page_number":176,"box":{"x":70,"y":581,"width":813,"height":12}},{"id":"a6bbe7f9-6169-434d-9345-48be305ffbef","block_type":"box","text":"under the rules for regulated investment companies. Losses in one series of a regulated investment company do not","page_number":176,"box":{"x":69,"y":596,"width":834,"height":12}},{"id":"f77d31c9-8390-4dd4-831b-c95cb0580e1c","block_type":"box","text":"offset gains in another, and the requirements (other than cer tain organizational requirements) for qualifying for","page_number":176,"box":{"x":69,"y":612,"width":790,"height":11}},{"id":"666e452e-dafb-428f-9351-8f9a36269797","block_type":"box","text":"regulated investment company status will be determined at the level of the individual series. In the following","page_number":176,"box":{"x":69,"y":627,"width":771,"height":11}},{"id":"16f00e6f-a991-426c-810b-2fdcbf047c75","block_type":"box","text":"discussion, the term “Fund” means each individual series, if applicable.","page_number":176,"box":{"x":69,"y":642,"width":512,"height":11}},{"id":"3bad4b49-4473-4ec7-91bf-d79c80180d69","block_type":"box","text":"The Code requires a regulated investment company to pay a nondeductible 4% excise tax to the extent the","page_number":176,"box":{"x":101,"y":665,"width":759,"height":11}},{"id":"41437d32-a98e-4f16-80bf-e53e5a6300d9","block_type":"box","text":"regulated investment company does not distribute, during each calendar year, at least 98% of its ordinary income,","page_number":176,"box":{"x":69,"y":680,"width":813,"height":11}},{"id":"0f5482ef-fa43-47db-8b0d-6799df2f3de9","block_type":"box","text":"determined on a calendar year basis, and at least 98.2% of its capital gain net income, determined, in general, as if","page_number":176,"box":{"x":69,"y":695,"width":830,"height":11}},{"id":"e23ed588-aa4a-46ab-b8ba-90124281db74","block_type":"box","text":"the regulated investment company’s taxable year ended on October 31, plus cer tain undistributed amounts from the","page_number":176,"box":{"x":68,"y":710,"width":832,"height":11}},{"id":"ab631cd7-fc2a-4893-8d83-ee47f99ab176","block_type":"box","text":"previous years. While each Fund intends to distribute its income and capital gains in the manner necessary to avoid","page_number":176,"box":{"x":70,"y":725,"width":825,"height":11}},{"id":"55f3c65c-8c96-4161-8b9b-c7f56cda30ef","block_type":"box","text":"imposition of the 4% excise tax, there can be no assurance that a sufficient amount of the Fund’s taxable income","page_number":176,"box":{"x":70,"y":740,"width":810,"height":11}},{"id":"db20917f-a386-4c6b-b4a6-e30c08f70641","block_type":"box","text":"and capital gains will be distributed to avoid entirely the imposition of the tax. In such event, a Fund will be liable for","page_number":176,"box":{"x":69,"y":755,"width":828,"height":11}},{"id":"530df142-c1ae-4f71-979a-d8763bb15aa1","block_type":"box","text":"the tax only on the amount by which it does not meet the foregoing distribution requirements.","page_number":176,"box":{"x":68,"y":770,"width":666,"height":12}},{"id":"6c925c94-b61b-4221-a1da-b197e74c3884","block_type":"box","text":"Net capital loss carryforwards may be applied against realized capital gains in each succeeding year, until they","page_number":176,"box":{"x":102,"y":793,"width":790,"height":11}},{"id":"64d98ced-aa0f-4386-a657-1b10b96d3ffd","block_type":"box","text":"have been reduced to zero. In the event that the Fund were to experience an ownership change as defined under the","page_number":176,"box":{"x":69,"y":808,"width":830,"height":11}},{"id":"c5aeb876-c4ac-43d1-b1f5-ed1e00fcd22a","block_type":"box","text":"Code, the Fund’s loss carryforwards and other favorable tax attributes of the Fund, if any, may be subject to","page_number":176,"box":{"x":69,"y":823,"width":770,"height":11}},{"id":"541ed01e-afda-47d5-a100-044a91637fee","block_type":"box","text":"limitation.","page_number":176,"box":{"x":70,"y":839,"width":68,"height":8}},{"id":"497ef1c4-03e6-401e-aa63-adb87ea347ec","block_type":"box","text":"Dividends paid by a Fund from its ordinary income or from an excess of net shor t-term capital gain over net long","page_number":176,"box":{"x":102,"y":861,"width":803,"height":11}},{"id":"ada699e7-1ff0-4e25-bac7-60d74c677bd0","block_type":"box","text":"term capital loss (together referred to as “ordinary income dividends”) are taxable to shareholders as ordinary","page_number":176,"box":{"x":68,"y":876,"width":790,"height":11}},{"id":"d0146829-9a0a-4f13-bd27-46ac4b3c2a58","block_type":"box","text":"income. Distributions made from an excess of net long-term capital gain over net shor t-term capital loss (including","page_number":176,"box":{"x":70,"y":891,"width":815,"height":12}},{"id":"7bdd9ba3-b5f2-42aa-86ac-b5bfc9f5d33e","block_type":"box","text":"gains or losses from cer tain transactions in futures and options) (“capital gain dividends”) are taxable to","page_number":176,"box":{"x":68,"y":906,"width":748,"height":12}},{"id":"00580c09-63a3-4331-ab2b-5cb8aca59b85","block_type":"box","text":"II-129","page_number":176,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"48583b2a-90c5-4847-9e5c-311706a25a81","block_type":"box","text":"NM1026U-6033063-176/246","page_number":176,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"81d7a437-7414-4c40-9f8b-ea31990e2b63","block_type":"box","text":"shareholders as long-term capital gains, regardless of the length of time the shareholder has owned Fund shares.","page_number":177,"box":{"x":69,"y":45,"width":811,"height":11}},{"id":"7733fc3d-9359-49d7-9f0a-5b0c14668fad","block_type":"box","text":"Distributions paid by a Fund that are repor ted as exempt-interest dividends will not be subject to regular U.S. federal","page_number":177,"box":{"x":70,"y":60,"width":829,"height":11}},{"id":"e1d69fd7-a133-4a2a-b271-51627621a7df","block_type":"box","text":"income tax. Cer tain dividend income and long-term capital gains are eligible for taxation at a reduced rate that","page_number":177,"box":{"x":70,"y":75,"width":785,"height":11}},{"id":"2ebfed24-78a2-4480-b4a7-5730d5664c60","block_type":"box","text":"applies to non-corporate shareholders. Under these rules, the por tion of ordinary income dividends constituting","page_number":177,"box":{"x":69,"y":90,"width":795,"height":11}},{"id":"bf97b22a-cecf-42bb-a21f-ef6f2c3f1e65","block_type":"box","text":"“qualified dividend income” when paid by a regulated investment company to a non-corporate shareholder may be","page_number":177,"box":{"x":70,"y":105,"width":809,"height":11}},{"id":"0e3153dc-de33-4b63-93a2-6fdeaf3b6ac5","block_type":"box","text":"taxable to such shareholder at long-term capital gain rates provided the shareholder has held the shares on which","page_number":177,"box":{"x":68,"y":120,"width":814,"height":12}},{"id":"0b92eecd-3b25-4341-8e00-2cf6f6c93948","block_type":"box","text":"the dividend was paid for at least 61 days during the 121-day period that begins on the date that is 60 days before","page_number":177,"box":{"x":68,"y":135,"width":822,"height":12}},{"id":"170b8791-52b2-4fcf-8fb1-cd4efb0df7a1","block_type":"box","text":"the date on which the shares become ex-dividend with respect to such dividend (or, in the case of cer tain","page_number":177,"box":{"x":68,"y":150,"width":751,"height":11}},{"id":"4dbfad15-7426-4033-81c4-5b21284e3c39","block_type":"box","text":"accumulated dividends with respect to preferred stocks, the shareholder has held the shares on which the dividend","page_number":177,"box":{"x":69,"y":166,"width":823,"height":11}},{"id":"c101cb19-bf5d-4f32-9c50-63f67a73a98b","block_type":"box","text":"was paid for at least 91 days during the 181-day period that begins on the date that is 90 days before the date on","page_number":177,"box":{"x":68,"y":181,"width":817,"height":11}},{"id":"347c0222-da11-47fc-8c18-bce25f5021ae","block_type":"box","text":"which the shares become ex-dividend with respect to such dividend). However, to the extent a Fund’s distributions","page_number":177,"box":{"x":68,"y":196,"width":813,"height":11}},{"id":"276b8e81-ec32-4d76-9124-24364ee377df","block_type":"box","text":"are derived from income on debt securities, cer tain types of preferred stock treated as debt for U.S. federal income","page_number":177,"box":{"x":69,"y":211,"width":825,"height":11}},{"id":"629c1637-8176-4ba6-8fd9-f5389343db9e","block_type":"box","text":"tax purposes and shor t-term capital gains, such distributions will not constitute “qualified dividend income.” In","page_number":177,"box":{"x":68,"y":226,"width":789,"height":11}},{"id":"50cd4372-10ef-4cbc-9610-14733d0dfb34","block_type":"box","text":"addition, distributions that are derived from securities lending income, such as substitute dividend payments, will not","page_number":177,"box":{"x":69,"y":241,"width":836,"height":11}},{"id":"b9513622-a5e2-4f86-b7dd-e3985c316b63","block_type":"box","text":"constitute “qualified dividend income.”","page_number":177,"box":{"x":69,"y":256,"width":275,"height":11}},{"id":"0dd3339a-821b-44ec-a2ee-ed6a7a645601","block_type":"box","text":"A 3.8% Medicare tax is imposed on the net investment income (which includes taxable dividends and redemption","page_number":177,"box":{"x":101,"y":279,"width":806,"height":11}},{"id":"62a4fbad-aeea-4cf9-9f74-49035cea389e","block_type":"box","text":"proceeds) of cer tain individuals, trusts and estates.","page_number":177,"box":{"x":70,"y":294,"width":368,"height":11}},{"id":"92a77117-bf82-4da3-9d58-314657ebf30d","block_type":"box","text":"A Fund’s net capital gain (the excess of net long-term capital gains over net shor t-term capital losses) is not","page_number":177,"box":{"x":101,"y":317,"width":772,"height":11}},{"id":"04d346c2-2886-4267-aa70-c0434bdeb631","block_type":"box","text":"subject to the 90% distribution requirement for taxation as a regulated investment company, described above. If a","page_number":177,"box":{"x":69,"y":332,"width":811,"height":11}},{"id":"d3221261-ddb5-4eb1-866c-26216a46f517","block_type":"box","text":"Fund retains net capital gain, it is subject to tax on that gain, and may designate the retained amount as","page_number":177,"box":{"x":70,"y":347,"width":745,"height":11}},{"id":"0c4acf4e-eb49-4fac-b9b9-6b755afb7a06","block_type":"box","text":"undistributed capital gain in a written statement furnished to its shareholders, who will be required to include in","page_number":177,"box":{"x":69,"y":362,"width":795,"height":11}},{"id":"c1d24bda-9d7f-4af2-9a5c-aaabff01c1d6","block_type":"box","text":"income, as long-term capital gain, their propor tionate shares of such undistributed net capital gain, will be deemed to","page_number":177,"box":{"x":70,"y":377,"width":838,"height":12}},{"id":"5916712b-f012-45d6-ac5c-969271b834c6","block_type":"box","text":"have paid and may claim as a credit against their U.S. federal income tax liability (and as a refund to the extent it","page_number":177,"box":{"x":69,"y":392,"width":809,"height":12}},{"id":"5224b342-f86b-4787-8f8f-3723ea68b318","block_type":"box","text":"exceeds that liability) their propor tionate shares of the tax paid by the Fund on that gain, and shall increase the tax","page_number":177,"box":{"x":69,"y":407,"width":822,"height":12}},{"id":"d57162b4-8417-4381-96f2-0453a0920701","block_type":"box","text":"basis of their shares in the Fund by the excess of the amount included in income over the amount allowed as a credit","page_number":177,"box":{"x":69,"y":423,"width":838,"height":11}},{"id":"226e9415-b627-48ca-8587-fbb9861328f3","block_type":"box","text":"against their taxes.","page_number":177,"box":{"x":69,"y":438,"width":135,"height":11}},{"id":"748b5bbf-df1b-4169-85d7-98bedd3cc0f7","block_type":"box","text":"Distributions in excess of a Fund’s current and accumulated earnings and profits will first reduce the adjusted","page_number":177,"box":{"x":102,"y":460,"width":783,"height":12}},{"id":"15c87b7e-a4fb-4fcd-b6d1-fee12b7b3320","block_type":"box","text":"tax basis of a holder’s shares and after such adjusted tax basis is reduced to zero, will constitute capital gains to","page_number":177,"box":{"x":68,"y":475,"width":812,"height":12}},{"id":"a7ed219e-a7ae-4ff4-8cff-12aaa72a8522","block_type":"box","text":"such holder (assuming the shares are held as a capital asset). Distributions in excess of a Fund’s minimum","page_number":177,"box":{"x":69,"y":491,"width":769,"height":11}},{"id":"0c2416bd-90c1-4e7c-b76d-263596ef372d","block_type":"box","text":"distribution requirements (or taxable income) but not in excess of a Fund’s earnings and profits will be taxable to","page_number":177,"box":{"x":69,"y":506,"width":805,"height":11}},{"id":"43fff105-cc89-4600-8b6c-247b961c83d1","block_type":"box","text":"shareholders and will not constitute nontaxable returns of capital. In the case of a Fund with a non-calendar taxable","page_number":177,"box":{"x":69,"y":521,"width":824,"height":11}},{"id":"85fa223f-7614-468f-85fe-b5cf03f16f3d","block_type":"box","text":"year, a Fund’s earnings and profits are allocated first to distributions made on or before December 31 of the taxable","page_number":177,"box":{"x":68,"y":536,"width":831,"height":11}},{"id":"841a6d06-fcfa-4689-bd89-df809ef8d7b9","block_type":"box","text":"year, and then to distributions made after December 31 of the taxable year. Any loss upon the sale or exchange of","page_number":177,"box":{"x":68,"y":551,"width":817,"height":11}},{"id":"3fd8aed4-4965-45d1-91f6-11b840ec9d22","block_type":"box","text":"Fund shares held for six months or less will be treated as long-term capital loss to the extent of any capital gain","page_number":177,"box":{"x":70,"y":566,"width":797,"height":11}},{"id":"88226295-70e7-48a2-a2c8-9c9354a59de8","block_type":"box","text":"dividends received by the shareholder.","page_number":177,"box":{"x":69,"y":582,"width":272,"height":10}},{"id":"a814f6aa-aaa6-48d4-b607-28decd7d5b11","block_type":"box","text":"Ordinary income and capital gain dividends are taxable to shareholders even if they are reinvested in additional","page_number":177,"box":{"x":102,"y":604,"width":792,"height":11}},{"id":"29f7e92e-48fe-4d26-866e-6d7b5bd878a9","block_type":"box","text":"shares of a Fund. Distributions by a Fund, whether from ordinary income or capital gains, generally will not be eligible","page_number":177,"box":{"x":69,"y":619,"width":835,"height":11}},{"id":"2f3acbf0-b876-4b13-ac31-fe321486bf96","block_type":"box","text":"for the dividends received deduction allowed to corporations under the Code. If a Fund pays a dividend in January","page_number":177,"box":{"x":68,"y":634,"width":809,"height":11}},{"id":"82b6ee2b-5b17-472b-ae9a-4106ca2d02f8","block_type":"box","text":"that was declared in the previous October, November or December to shareholders of record on a specified date in","page_number":177,"box":{"x":68,"y":649,"width":819,"height":11}},{"id":"95dc4531-e311-4893-a4b8-0a5de4ce7220","block_type":"box","text":"one of such months, then such dividend will be treated for tax purposes as being paid by the Fund and received by its","page_number":177,"box":{"x":69,"y":664,"width":839,"height":12}},{"id":"ffb47238-0720-4d91-a048-1d8091474a73","block_type":"box","text":"shareholders on December 31 of the year in which the dividend was declared. In the case of a Fund with a non","page_number":177,"box":{"x":69,"y":680,"width":794,"height":11}},{"id":"c84eb312-a128-4f28-8073-c9f8d0330e8b","block_type":"box","text":"calendar taxable year, if the Fund repor ts more capital gain dividends than it earns in such taxable year, then the","page_number":177,"box":{"x":69,"y":695,"width":804,"height":11}},{"id":"19e47f17-03fc-4138-9d1a-97b96c75b35f","block_type":"box","text":"Fund will reduce the amounts repor ted as capital gains. Where possible, such reduction will first be allocated to","page_number":177,"box":{"x":70,"y":710,"width":797,"height":11}},{"id":"b0508c9a-dc05-49c8-9366-ce235e6511e1","block_type":"box","text":"dividends made after December 31 of such taxable year. A Fund may elect to defer recognizing, until the following","page_number":177,"box":{"x":69,"y":725,"width":810,"height":11}},{"id":"9f6176c7-76ba-4d1a-b45e-24d46ddfd0e9","block_type":"box","text":"taxable year, cer tain net capital losses arising after October 31 of the current taxable year, and cer tain net ordinary","page_number":177,"box":{"x":68,"y":740,"width":826,"height":11}},{"id":"3cc4e541-6995-4aa9-a288-c05b49a6ca89","block_type":"box","text":"losses arising after October 31 and/or December 31 of the current taxable year. This may have the effect of","page_number":177,"box":{"x":70,"y":755,"width":772,"height":11}},{"id":"4de3a0e3-e6b0-4be7-8d63-b23852883dc9","block_type":"box","text":"increasing the amount of dividends otherwise includible in the shareholder’s income with respect to the current","page_number":177,"box":{"x":70,"y":770,"width":795,"height":12}},{"id":"a6d5d84c-a46e-4cb7-a96c-ebe7dd6d28b5","block_type":"box","text":"taxable year.","page_number":177,"box":{"x":68,"y":786,"width":89,"height":11}},{"id":"2b9307c5-19fd-40bd-9524-814e972eef19","block_type":"box","text":"No gain or loss will be recognized by Investor C shareholders on the conversion to Investor A Shares. A","page_number":177,"box":{"x":102,"y":808,"width":733,"height":11}},{"id":"d2a77ea8-162c-4f30-a5f2-ce973817aaf9","block_type":"box","text":"shareholder’s tax basis in the Investor A Shares acquired upon conversion will be the same as the shareholder’s tax","page_number":177,"box":{"x":69,"y":823,"width":832,"height":11}},{"id":"67e0233d-a5b0-4232-87a6-f1c3c5d0ac74","block_type":"box","text":"basis in the conver ted Investor C Shares and the holding period of the acquired Investor A Shares will include the","page_number":177,"box":{"x":69,"y":838,"width":809,"height":12}},{"id":"7aad3083-d37d-4cb2-a99a-7402bff6ac87","block_type":"box","text":"holding period for the conver ted Investor C Shares.","page_number":177,"box":{"x":69,"y":853,"width":362,"height":12}},{"id":"4be931a3-dc57-4d55-950b-a02e9aee916c","block_type":"box","text":"If a shareholder of a Fund exercises an exchange privilege within 90 days of acquiring the shares of a Fund, but","page_number":177,"box":{"x":102,"y":876,"width":795,"height":11}},{"id":"19e77253-3878-40d2-94d8-407bebc99645","block_type":"box","text":"on or before January 31 of the following year, then the loss that the shareholder recognizes on the exchange will be","page_number":177,"box":{"x":69,"y":891,"width":824,"height":12}},{"id":"505fdc3d-e1f1-43d8-91a8-6a43de79cbbe","block_type":"box","text":"reduced (or the gain increased) to the extent any sales charge paid on the exchanged shares reduces any sales","page_number":177,"box":{"x":69,"y":907,"width":797,"height":11}},{"id":"4a1fa3c3-5a31-45cf-a972-6e46848fd9d2","block_type":"box","text":"II-130","page_number":177,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"034cd517-8b9e-40d9-94af-b94d5485bf42","block_type":"box","text":"NM1026U-6033063-177/246","page_number":177,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"f7c11024-d3ac-400c-8fd7-bf1420a32bc6","block_type":"box","text":"charge the shareholder would have owed upon the purchase of the new shares in the absence of the exchange","page_number":178,"box":{"x":69,"y":45,"width":791,"height":11}},{"id":"0c9b9caf-085d-45b6-9a75-7a2d9b2021e9","block_type":"box","text":"privilege. Instead, such sales charge will be treated as an amount paid for the new shares.","page_number":178,"box":{"x":70,"y":60,"width":646,"height":11}},{"id":"f54ea99f-27c4-4e46-b1a3-48ff290961e5","block_type":"box","text":"A loss realized on a sale or exchange of shares of a Fund will be disallowed if other substantially identical shares","page_number":178,"box":{"x":101,"y":82,"width":807,"height":12}},{"id":"a82fdfa7-1438-4527-9b69-6748a9e8b598","block_type":"box","text":"are acquired (whether through the automatic reinvestment of dividends or otherwise) within a 61-day period beginning","page_number":178,"box":{"x":69,"y":98,"width":839,"height":11}},{"id":"42293412-1aa6-4c72-8100-028c8bf18963","block_type":"box","text":"30 days before and ending 30 days after the date on which the shares are sold or exchanged. In such case, the","page_number":178,"box":{"x":69,"y":113,"width":799,"height":11}},{"id":"a34d28a0-7f16-4382-b730-51f2611ab99d","block_type":"box","text":"basis of the shares acquired will be adjusted to reflect the disallowed loss.","page_number":178,"box":{"x":69,"y":128,"width":534,"height":11}},{"id":"464e0fcc-fcd2-424f-a99b-d9d94df56753","block_type":"box","text":"A Fund is also generally required by law to repor t to each shareholder and to the IRS cost basis information for","page_number":178,"box":{"x":101,"y":150,"width":792,"height":12}},{"id":"b19b455f-6af9-4da0-9728-c6ca440eef35","block_type":"box","text":"shares of the Fund acquired on or after January 1, 2012, and sold or redeemed after that date. This information","page_number":178,"box":{"x":69,"y":166,"width":800,"height":11}},{"id":"c3b5c86d-e534-408d-bec3-4cf2c0775ef3","block_type":"box","text":"includes the adjusted cost basis of the shares, the gross proceeds from disposition, and whether the gain or loss is","page_number":178,"box":{"x":70,"y":181,"width":828,"height":11}},{"id":"716c87dc-d8c9-43c7-b59c-189fa7a48f71","block_type":"box","text":"long-term or shor t-term. The adjusted cost basis of shares will be based on the default cost basis repor ting method","page_number":178,"box":{"x":70,"y":196,"width":824,"height":11}},{"id":"f534db9b-6863-4a7f-bc9c-89621db3d059","block_type":"box","text":"selected by the Fund, unless a shareholder, before the sale or redemption, informs the Fund that it has selected a","page_number":178,"box":{"x":69,"y":211,"width":816,"height":11}},{"id":"ad2c66d9-1ba4-47a2-94af-8a1059994fab","block_type":"box","text":"different IRS-accepted method offered by the Fund. These requirements, however, will not apply for investments","page_number":178,"box":{"x":69,"y":226,"width":797,"height":11}},{"id":"94d3fc6f-d1d9-4afb-92de-eceffb9f14fc","block_type":"box","text":"through an IRA or other tax-advantaged account. Shareholders should consult their tax advisors to determine the best","page_number":178,"box":{"x":68,"y":241,"width":840,"height":11}},{"id":"7058dbdb-c5d0-448d-8a17-e70e9240b9a8","block_type":"box","text":"cost basis method for their tax situation, and to obtain more information about how these cost basis repor ting","page_number":178,"box":{"x":69,"y":256,"width":788,"height":12}},{"id":"275235b2-1021-4295-9e76-5405a9c508b7","block_type":"box","text":"requirements apply to them. For shares of a Fund acquired before January 1, 2012, these requirements will not","page_number":178,"box":{"x":69,"y":271,"width":797,"height":12}},{"id":"9037d1d4-7407-400a-a26b-37bd4d494978","block_type":"box","text":"apply, but the Fund will continue to repor t to the IRS the gross proceeds received by a shareholder from the sale or","page_number":178,"box":{"x":69,"y":286,"width":821,"height":12}},{"id":"ab295bca-3193-4666-9595-6d36c30a694f","block_type":"box","text":"redemption of such shares.","page_number":178,"box":{"x":69,"y":302,"width":195,"height":11}},{"id":"17d22875-e223-4bdc-9c62-5dd25528616b","block_type":"box","text":"Cer tain Funds may invest in derivative contracts such as options, futures contracts, forward contracts and swap","page_number":178,"box":{"x":102,"y":324,"width":799,"height":11}},{"id":"401095c6-f6bf-49f8-a028-206dd5e5255a","block_type":"box","text":"agreements. The U.S. federal income tax treatment of a derivative contract may not be as favorable as a direct","page_number":178,"box":{"x":69,"y":339,"width":791,"height":12}},{"id":"e28d1c76-7554-46e8-9d45-a9369b6258cd","block_type":"box","text":"investment in the underlying security and may adversely affect the timing, character and amount of income the Fund","page_number":178,"box":{"x":70,"y":355,"width":826,"height":11}},{"id":"466ec066-6466-4e14-afb2-a6548744b27f","block_type":"box","text":"realizes from its investments. As a result, a larger por tion of the Fund’s distributions may be treated as ordinary","page_number":178,"box":{"x":69,"y":370,"width":803,"height":11}},{"id":"4d380163-0ca6-4f45-9309-7b2b17062aa4","block_type":"box","text":"income rather than capital gains. In addition, section 1256 contracts held by a Fund at the end of each taxable year","page_number":178,"box":{"x":70,"y":385,"width":825,"height":11}},{"id":"21299d0e-f2ee-4396-ad01-7e640a9080c3","block_type":"box","text":"(and, for purposes of the 4% excise tax, cer tain other dates as prescribed under the Code) are generally “marked-to","page_number":178,"box":{"x":69,"y":400,"width":829,"height":11}},{"id":"a5984ac9-3cef-40ab-9505-227985db2c2f","block_type":"box","text":"market,” such that unrealized gains or losses are treated as though they were realized (with such gain or loss being","page_number":178,"box":{"x":69,"y":415,"width":826,"height":11}},{"id":"cf3fda4e-4d2e-4998-992d-319a5c652633","block_type":"box","text":"considered 60% long-term and 40% shor t-term capital gain or loss), which may increase the amount that must be","page_number":178,"box":{"x":69,"y":430,"width":808,"height":11}},{"id":"95a78f98-f0cf-426c-92f9-acbb492c89f9","block_type":"box","text":"distributed to meet distribution requirements and avoid the excise tax. In addition, the tax treatment of cer tain","page_number":178,"box":{"x":69,"y":445,"width":787,"height":11}},{"id":"6483091d-b0cc-468c-a811-61fece553270","block_type":"box","text":"derivative contracts, such as swap agreements, is unsettled and may be subject to future legislation, regulation or","page_number":178,"box":{"x":69,"y":460,"width":816,"height":12}},{"id":"b085d778-3901-4421-b057-0a15a7f23f38","block_type":"box","text":"administrative pronouncements issued by the IRS. If such future guidance limits the Fund’s ability to use derivatives,","page_number":178,"box":{"x":69,"y":475,"width":832,"height":12}},{"id":"03fe4af5-b023-4e20-bf76-87e7aeb97cc6","block_type":"box","text":"the Fund may have to find other ways of achieving its investment objectives.","page_number":178,"box":{"x":68,"y":491,"width":542,"height":11}},{"id":"0a9ec0bd-ed09-42ef-9594-6dd7605a7d64","block_type":"box","text":"Cer tain swap agreements, including exchange-traded swap agreements, are treated as notional principal","page_number":178,"box":{"x":102,"y":513,"width":744,"height":12}},{"id":"63023032-07a4-4943-bb62-667fca92360f","block_type":"box","text":"contracts rather than as section 1256 contracts. This can affect the type of income earned by such swap","page_number":178,"box":{"x":69,"y":528,"width":751,"height":12}},{"id":"72694506-b000-4dcc-a264-bc8d321e0395","block_type":"box","text":"agreements since all the income on a notional principal contract may be ordinary income, whereas 40% of the gain","page_number":178,"box":{"x":69,"y":543,"width":819,"height":12}},{"id":"6be27e0a-42e9-46d1-9e84-139c1c9af0bd","block_type":"box","text":"on a section 1256 contract is treated as shor t-term capital gain taxed at ordinary rates and 60% is treated as long","page_number":178,"box":{"x":69,"y":559,"width":823,"height":11}},{"id":"e7f7259c-6a9f-46ba-9937-79cd0a2a7ecb","block_type":"box","text":"term capital gain taxed at more favorable rates when distributed to shareholders. The rest is long-term capital gain,","page_number":178,"box":{"x":68,"y":574,"width":823,"height":11}},{"id":"6984f2f5-fbc5-472f-b56a-e63f381e2d37","block_type":"box","text":"which may be taxable at more favorable rates than ordinary income. Proposed regulations interpret what types of","page_number":178,"box":{"x":68,"y":589,"width":807,"height":11}},{"id":"27140dea-bfa6-4b1e-a8b6-b89dcf15a612","block_type":"box","text":"swap agreements are to be treated as notional principal contracts rather than as section 1256 contracts. When","page_number":178,"box":{"x":69,"y":604,"width":797,"height":11}},{"id":"29d91dee-2af6-44ca-a17b-1a9eb0f41c73","block_type":"box","text":"finalized, these regulations could result in the Fund having to treat more of its income on swap agreements and more","page_number":178,"box":{"x":68,"y":619,"width":838,"height":11}},{"id":"afac07e9-c1a5-4cfa-ad99-43fdf1e44ab5","block_type":"box","text":"of the distributions made to shareholders as ordinary income and less as long-term capital gains.","page_number":178,"box":{"x":69,"y":634,"width":695,"height":12}},{"id":"c1bda03f-1d62-49d5-9002-1c8e92a63e74","block_type":"box","text":"Cer tain Funds may invest in zero coupon U.S. Treasury bonds and other debt securities that are issued at a","page_number":178,"box":{"x":102,"y":657,"width":768,"height":11}},{"id":"d3d64df3-0006-4077-b3e0-8a8140fe57f8","block_type":"box","text":"discount or provide for deferred interest. Even though a Fund receives no actual interest payments on these","page_number":178,"box":{"x":69,"y":672,"width":769,"height":11}},{"id":"d4fd41aa-a8e5-4653-933a-162088d49475","block_type":"box","text":"securities, it will be deemed to receive income equal, generally, to a por tion of the excess of the stated redemption","page_number":178,"box":{"x":69,"y":687,"width":822,"height":11}},{"id":"aea10873-69dd-45f9-a2aa-4ce12f5d8e0b","block_type":"box","text":"price of the securities over their issue price (“original issue discount”) each year that the securities are held. Since","page_number":178,"box":{"x":70,"y":702,"width":819,"height":12}},{"id":"e6d44a4d-6232-4ca3-ab81-4655cb389f37","block_type":"box","text":"the original issue discount income earned by a Fund in a taxable year may not be represented by cash income, the","page_number":178,"box":{"x":68,"y":718,"width":818,"height":11}},{"id":"1810c26a-6622-4c0e-983b-fdd22e6bcd3d","block_type":"box","text":"Fund may have to dispose of securities, which it might otherwise have continued to hold, or borrow to generate cash","page_number":178,"box":{"x":70,"y":732,"width":830,"height":12}},{"id":"27a71e03-8aff-415c-b0f6-fae60b8f2c88","block_type":"box","text":"in order to satisfy its distribution requirements. In addition, a Fund’s investment in foreign currencies or foreign","page_number":178,"box":{"x":70,"y":748,"width":792,"height":11}},{"id":"807e6c73-349b-440f-943e-153d01f4b722","block_type":"box","text":"currency denominated or referenced debt securities, cer tain asset-backed securities and contingent payment and","page_number":178,"box":{"x":69,"y":763,"width":808,"height":11}},{"id":"011d4ed6-b112-4c2b-8063-5ada4d692a77","block_type":"box","text":"inflation-indexed debt instruments also may increase or accelerate the Fund’s recognition of income, including the","page_number":178,"box":{"x":70,"y":778,"width":812,"height":11}},{"id":"4ca06b44-07ca-4279-9388-ea8b5a043830","block_type":"box","text":"recognition of taxable income in excess of cash generated by such investments. Any transaction by the Fund in","page_number":178,"box":{"x":69,"y":793,"width":789,"height":11}},{"id":"9d5aea48-707e-45f9-b117-4c68f1a22e65","block_type":"box","text":"foreign currencies, foreign currency-denominated debt obligations or cer tain foreign currency options, futures","page_number":178,"box":{"x":68,"y":808,"width":777,"height":11}},{"id":"bc1135f5-61d0-4dab-8f71-5ad1968ec7a0","block_type":"box","text":"contracts or forward contracts (or similar instruments) may give rise to ordinary income or loss to the extent such","page_number":178,"box":{"x":69,"y":823,"width":810,"height":12}},{"id":"b983b208-a844-43b2-817a-38865e6aa85e","block_type":"box","text":"income or loss results from fluctuations in the value of the foreign currency concerned. Any such net gains could","page_number":178,"box":{"x":70,"y":838,"width":801,"height":12}},{"id":"d47a7812-b344-4332-a78e-7cf081d38a6f","block_type":"box","text":"require a larger dividend toward the end of the calendar year. Any such net losses will generally reduce and","page_number":178,"box":{"x":69,"y":853,"width":762,"height":12}},{"id":"0881646f-3aa1-4b7d-9ed4-c08f149e9f0f","block_type":"box","text":"potentially require the recharacterization of prior ordinary income distributions. Such ordinary income treatment may","page_number":178,"box":{"x":70,"y":869,"width":827,"height":11}},{"id":"be1f78d7-c988-4cea-9eef-09bcf22ed77a","block_type":"box","text":"accelerate Fund distributions to shareholders and increase the distributions taxed to shareholders as ordinary","page_number":178,"box":{"x":69,"y":884,"width":787,"height":11}},{"id":"acabc6e2-55bc-474f-987e-0533fdfc8ec2","block_type":"box","text":"II-131","page_number":178,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"d6fdee71-7413-4d31-8ef7-fb04a9a1aebd","block_type":"box","text":"NM1026U-6033063-178/246","page_number":178,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"ec545573-f608-489a-8a8c-743dc6da2a13","block_type":"box","text":"income. Any net ordinary losses so created cannot be carried forward by the Fund to offset income or gains earned","page_number":179,"box":{"x":70,"y":45,"width":822,"height":11}},{"id":"f03c0cda-e8e4-4b99-a48b-ce02af449460","block_type":"box","text":"in subsequent taxable years.","page_number":179,"box":{"x":70,"y":60,"width":203,"height":11}},{"id":"562bf340-474a-46eb-9437-03f19589461c","block_type":"box","text":"Ordinary income dividends paid to shareholders who are nonresident aliens or foreign entities (other than pass","page_number":179,"box":{"x":102,"y":82,"width":795,"height":12}},{"id":"9f77e146-98f6-4bb3-b0a3-3616510e255d","block_type":"box","text":"through entities to the extent owned by U.S. persons) generally will be subject to a 30% U.S. withholding tax under","page_number":179,"box":{"x":68,"y":98,"width":816,"height":11}},{"id":"7d1c5c37-59f6-4c14-945b-01f812b7fb91","block_type":"box","text":"existing provisions of the Code applicable to foreign individuals and entities unless a reduced rate of withholding or a","page_number":179,"box":{"x":69,"y":113,"width":835,"height":11}},{"id":"f5ed8a15-01df-4253-b1bb-3bfe40937fc5","block_type":"box","text":"withholding exemption is provided under applicable treaty law. Capital gain dividends paid to shareholders that are","page_number":179,"box":{"x":68,"y":128,"width":815,"height":11}},{"id":"6370479a-34c0-407b-ba85-54587bdc8dfc","block_type":"box","text":"nonresident aliens or foreign entities, if and to the extent properly repor ted as capital gain dividends, generally will","page_number":179,"box":{"x":69,"y":143,"width":816,"height":11}},{"id":"18251118-9ff5-4aa2-8456-c09d0d254705","block_type":"box","text":"not be subject to a 30% withholding tax, unless cer tain exceptions apply. Dividends derived by a regulated investment","page_number":179,"box":{"x":69,"y":158,"width":840,"height":11}},{"id":"7f433c3f-c724-48c2-a83c-88fa39815169","block_type":"box","text":"company from shor t-term capital gains and qualified net interest income (including income from original issue","page_number":179,"box":{"x":69,"y":173,"width":781,"height":11}},{"id":"df082875-e659-42fc-8107-88755bdf3c4d","block_type":"box","text":"discount and market discount) and paid to shareholders who are nonresident aliens or foreign entities, if and to the","page_number":179,"box":{"x":69,"y":188,"width":824,"height":12}},{"id":"6d605cf4-7fee-4f9f-82e8-395d2f5267f5","block_type":"box","text":"extent properly repor ted as “shor t-term capital gain dividends” or “interest-related dividends”, respectively, generally","page_number":179,"box":{"x":69,"y":204,"width":832,"height":11}},{"id":"b00422a1-5a3e-41e0-911b-ddf551ecf2cd","block_type":"box","text":"will not be subject to U.S. withholding tax. Where possible, the Funds intend to repor t such dividends as interest","page_number":179,"box":{"x":68,"y":219,"width":808,"height":11}},{"id":"b5976997-ad4e-427a-aa26-e60d97265693","block_type":"box","text":"related dividends or shor t-term capital gain dividends. However, depending on its circumstances, a Fund may repor t","page_number":179,"box":{"x":69,"y":234,"width":826,"height":11}},{"id":"3a07d7ac-1502-48ac-9b4a-c2b976686967","block_type":"box","text":"all, some or none of its potentially eligible dividends as interest-related or as shor t-term capital gain dividends, and/","page_number":179,"box":{"x":69,"y":249,"width":830,"height":11}},{"id":"8f3c741f-364f-4361-8276-902876e3df06","block_type":"box","text":"or treat such dividends, in whole or in par t, as ineligible for this exemption from withholding. In order to qualify for","page_number":179,"box":{"x":69,"y":264,"width":811,"height":11}},{"id":"1887abc4-cf8c-4ddc-b016-db13ff3e99b1","block_type":"box","text":"this exemption from withholding, a foreign shareholder must comply with applicable cer tification requirements","page_number":179,"box":{"x":68,"y":279,"width":784,"height":11}},{"id":"d732214d-8b18-419e-b8bf-7dee677adf34","block_type":"box","text":"relating to its foreign status (including, in general, furnishing an IRS Form W-8BEN, IRS Form W-8BEN-E or substitute","page_number":179,"box":{"x":69,"y":294,"width":828,"height":11}},{"id":"c27dbdea-a738-4ab0-8b67-26551fd63ba5","block_type":"box","text":"Form). In the case of shares held through an intermediary, the intermediary may withhold even if the Fund repor ts the","page_number":179,"box":{"x":70,"y":309,"width":839,"height":11}},{"id":"7bfd8834-c8d7-4826-8904-6688dfd8f8f5","block_type":"box","text":"payment as an interest-related or shor t-term capital gain dividend. Foreign shareholders should contact their","page_number":179,"box":{"x":70,"y":325,"width":772,"height":11}},{"id":"e5c22705-4733-448c-9494-b758665e428a","block_type":"box","text":"intermediaries with respect to the application of these rules to their accounts. It is not possible to predict what","page_number":179,"box":{"x":70,"y":339,"width":791,"height":11}},{"id":"5687ac81-4ef7-4676-807d-2eb80888a0b7","block_type":"box","text":"por tion, if any, of a Fund’s distributions will be repor ted as interest-related dividends or shor t-term capital gain","page_number":179,"box":{"x":70,"y":355,"width":787,"height":11}},{"id":"202a58b7-a120-41c5-a083-1655ae69d213","block_type":"box","text":"dividends under these rules.","page_number":179,"box":{"x":69,"y":370,"width":201,"height":9}},{"id":"be3b0908-7a5e-4f74-8d4e-91b895ffe6d6","block_type":"box","text":"Distributions to cer tain foreign shareholders by a Fund at least 50% of the assets of which are “U.S. real","page_number":179,"box":{"x":102,"y":392,"width":747,"height":12}},{"id":"64e90697-74f7-4440-9d76-801df8258567","block_type":"box","text":"proper ty interests” (as defined in the Code and Treasury regulations) at any time during the five-year period ending on","page_number":179,"box":{"x":70,"y":407,"width":838,"height":12}},{"id":"9058f20b-e80e-43eb-a447-3cb8b07532f6","block_type":"box","text":"the date of the distributions, to the extent the distributions are attributable to gains from sales or exchanges of U.S.","page_number":179,"box":{"x":68,"y":423,"width":829,"height":11}},{"id":"6cf3771a-80ab-46ba-9de8-43490683d274","block_type":"box","text":"real proper ty interests (including shares in cer tain “U.S. real proper ty holding corporations” such as cer tain REITs,","page_number":179,"box":{"x":69,"y":438,"width":817,"height":11}},{"id":"1aa3fb4c-345a-4b44-9fc9-87f33a041df6","block_type":"box","text":"although exceptions may apply if any class of stock of such a corporation is regularly traded on an established","page_number":179,"box":{"x":69,"y":453,"width":786,"height":11}},{"id":"7927de04-db4e-4a09-b957-1083fc3f0afd","block_type":"box","text":"securities market and the Fund has held no more than 5% of such class of stock at all times during the five-year","page_number":179,"box":{"x":69,"y":468,"width":800,"height":11}},{"id":"6fa62cf3-372d-40ba-9590-a912890ffb71","block_type":"box","text":"period ending on the date of the distributions), generally must be treated by such foreign shareholders as income","page_number":179,"box":{"x":70,"y":483,"width":807,"height":11}},{"id":"85df8b84-3b8a-4f34-8fc7-fdcb2d2ce9e2","block_type":"box","text":"effectively connected to a trade or business within the United States, which is generally subject to tax at the","page_number":179,"box":{"x":69,"y":498,"width":772,"height":11}},{"id":"3e9d70d0-a28f-44e9-b25f-998338cd6358","block_type":"box","text":"graduated rates applicable to U.S. shareholders, except for distributions to foreign shareholders that held no more","page_number":179,"box":{"x":68,"y":513,"width":818,"height":12}},{"id":"8004ce15-26d3-4444-84cf-748e2750125e","block_type":"box","text":"than 5% of any class of stock of the Fund at all times during the previous one-year period ending on the date of the","page_number":179,"box":{"x":68,"y":528,"width":820,"height":12}},{"id":"633ee45b-c250-4ef4-8b4d-f364bf3105fc","block_type":"box","text":"distributions. Such distributions will be subject to U.S. income and withholding tax and generally will require a foreign","page_number":179,"box":{"x":69,"y":543,"width":833,"height":12}},{"id":"6338801f-4b57-40c6-87b2-4c822079359d","block_type":"box","text":"shareholder to file a U.S. federal income tax return. If the foreign shareholder held no more than 5% of any class of","page_number":179,"box":{"x":69,"y":559,"width":823,"height":11}},{"id":"e0c3051c-5a97-4348-8b0f-c8c2481f7490","block_type":"box","text":"stock of the Fund at all times during the previous one-year period ending on the date of the distributions, the","page_number":179,"box":{"x":69,"y":574,"width":774,"height":11}},{"id":"0f77992f-7c72-4bc3-8b62-192f026db5ec","block_type":"box","text":"distributions will be taxable as ordinary dividends and subject to withholding at a 30% or lower treaty rate. In addition,","page_number":179,"box":{"x":69,"y":589,"width":839,"height":11}},{"id":"af112e23-eb50-4d67-a4a5-64570f0431d4","block_type":"box","text":"sales or redemptions of shares held by cer tain foreign shareholders in such a Fund generally will be subject to U.S.","page_number":179,"box":{"x":69,"y":604,"width":822,"height":11}},{"id":"06e2f793-6c62-4251-a1da-2c5eacf93f0d","block_type":"box","text":"income and withholding tax and generally will require the foreign shareholder to file a U.S. federal income tax return,","page_number":179,"box":{"x":70,"y":619,"width":827,"height":11}},{"id":"9771e3b9-a404-4f55-857b-79a593b1e962","block_type":"box","text":"although exceptions may apply if more than 50% of the value of the Fund’s shares are held by U.S. shareholders or","page_number":179,"box":{"x":69,"y":634,"width":823,"height":12}},{"id":"1498be94-9e31-451f-8cf7-05cec27e370b","block_type":"box","text":"the foreign shareholder selling or redeeming the shares has held no more than 5% of any class of stock of the Fund","page_number":179,"box":{"x":68,"y":649,"width":827,"height":12}},{"id":"3c84d202-b940-419b-9e17-1e2ef0d1519f","block_type":"box","text":"at all times during the five-year period ending on the date of the sale or redemption.","page_number":179,"box":{"x":69,"y":664,"width":596,"height":12}},{"id":"cdf804fb-1f03-438d-9ec7-845fc7148677","block_type":"box","text":"Provided that more than 50% of the value of a Fund’s stock is held by U.S. shareholders, redemptions and other","page_number":179,"box":{"x":102,"y":687,"width":802,"height":11}},{"id":"301e7dd8-a9d8-4a74-8271-7cb1daf0a710","block_type":"box","text":"distributions made in the form of U.S. real proper ty interests (including shares in cer tain “U.S. real proper ty holding","page_number":179,"box":{"x":69,"y":702,"width":827,"height":12}},{"id":"d52181a2-5274-4881-aa25-37992482c58c","block_type":"box","text":"corporations”, although exceptions may apply if any class of stock of such a corporation is regularly traded on an","page_number":179,"box":{"x":69,"y":717,"width":804,"height":12}},{"id":"76ad60bb-831a-4e14-859b-bcc63bfa3b4d","block_type":"box","text":"established securities market and the Fund has held no more than 5% of such class of stock at all times during the","page_number":179,"box":{"x":69,"y":732,"width":824,"height":12}},{"id":"f068cd1b-adbd-4134-b76d-dea51dae1207","block_type":"box","text":"five-year period ending on the date of the distribution) generally will cause the Fund to recognize a por tion of any","page_number":179,"box":{"x":68,"y":748,"width":801,"height":11}},{"id":"8992e3e9-f87f-46c5-942f-865ad0a80b62","block_type":"box","text":"unrecognized gain in the U.S. real proper ty interests equal to the product of (i) the excess of fair market value of","page_number":179,"box":{"x":69,"y":763,"width":803,"height":11}},{"id":"8e7e7b05-c7b1-49bc-932e-4a6bc0be6005","block_type":"box","text":"such U.S. real proper ty interests over the Fund’s adjusted bases in such interests and (ii) the greatest foreign","page_number":179,"box":{"x":69,"y":778,"width":785,"height":11}},{"id":"b8894393-8f05-45e7-a5d0-9531530d1118","block_type":"box","text":"ownership percentage of the Fund during the five-year period ending on the date of distribution.","page_number":179,"box":{"x":69,"y":793,"width":676,"height":11}},{"id":"a8df3cd7-b568-4363-9162-38a859df0665","block_type":"box","text":"A foreign shareholder may also be subject to cer tain “wash sale” rules to prevent the avoidance of the tax filing","page_number":179,"box":{"x":101,"y":816,"width":798,"height":11}},{"id":"3039da71-6a10-4058-bf48-d3c92b202579","block_type":"box","text":"and payment obligations discussed above through the sale and repurchase of Fund shares.","page_number":179,"box":{"x":69,"y":831,"width":651,"height":11}},{"id":"b4d57b04-9d86-4626-a21c-a2d40e028033","block_type":"box","text":"Shareholders that are nonresident aliens or foreign entities are urged to consult their own tax advisors","page_number":179,"box":{"x":102,"y":853,"width":731,"height":12}},{"id":"d9447a7e-bb16-4ede-b321-b5a135e25de4","block_type":"box","text":"concerning the par ticular tax consequences to them of an investment in a Fund.","page_number":179,"box":{"x":69,"y":869,"width":570,"height":11}},{"id":"e5841ff6-a546-447d-90b2-3f6d3ca247af","block_type":"box","text":"Separately, a 30% withholding tax is currently imposed on U.S.-source dividends, interest and other income","page_number":179,"box":{"x":102,"y":891,"width":763,"height":12}},{"id":"9f3cda30-d4a0-4919-bb5a-b3bd2c97aab0","block_type":"box","text":"items paid to (i) cer tain foreign financial institutions and investment funds, and (ii) cer tain other foreign entities. To","page_number":179,"box":{"x":70,"y":906,"width":820,"height":12}},{"id":"aa7516d1-e7dd-4a93-afc3-d3fda4425089","block_type":"box","text":"II-132","page_number":179,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"4e951566-df15-473a-8af2-dea51f894e01","block_type":"box","text":"NM1026U-6033063-179/246","page_number":179,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"fecc588e-bf8c-445e-9c37-2b4ad5d6d7d8","block_type":"box","text":"avoid withholding, foreign financial institutions and investment funds will generally either need to (a) collect and","page_number":180,"box":{"x":69,"y":45,"width":794,"height":11}},{"id":"bf7786e1-4ae3-4745-84f7-8f0a26b46fc5","block_type":"box","text":"repor t to the IRS detailed information identifying their U.S. accounts and U.S. account holders, comply with due","page_number":180,"box":{"x":69,"y":60,"width":794,"height":11}},{"id":"9b2ae635-4fc2-4b91-96a1-a381419c5bd5","block_type":"box","text":"diligence procedures for identifying U.S. accounts and withhold tax on cer tain payments made to noncomplying","page_number":180,"box":{"x":69,"y":75,"width":791,"height":11}},{"id":"f66bfc01-f70a-4ccd-bb9a-7e29de3a9129","block_type":"box","text":"foreign entities and account holders or (b) if an intergovernmental agreement is entered into and implementing","page_number":180,"box":{"x":68,"y":90,"width":791,"height":11}},{"id":"1b4de9a7-1645-4f0b-b018-818104cb64ce","block_type":"box","text":"legislation is adopted, comply with the agreement and legislation. Other foreign entities will generally either need to","page_number":180,"box":{"x":70,"y":105,"width":822,"height":11}},{"id":"8fe842a7-8efc-49b9-8486-e72b757f72d3","block_type":"box","text":"provide detailed information identifying each substantial U.S. owner or cer tify there are no such owners.","page_number":180,"box":{"x":70,"y":120,"width":739,"height":12}},{"id":"b0758cd1-26a9-44f2-9078-f1c83a31030e","block_type":"box","text":"Under cer tain provisions of the Code, some shareholders may be subject to a 24% withholding tax on ordinary","page_number":180,"box":{"x":102,"y":143,"width":786,"height":11}},{"id":"c31536ab-8e7b-4a8c-945f-e7844d0aacc2","block_type":"box","text":"income dividends, capital gain dividends and redemption payments (“backup withholding”). Generally, shareholders","page_number":180,"box":{"x":70,"y":158,"width":820,"height":11}},{"id":"db841aa3-910e-4d28-9aa7-c23eadbbc139","block_type":"box","text":"subject to backup withholding will be non-corporate shareholders for whom no cer tified taxpayer identification number","page_number":180,"box":{"x":69,"y":173,"width":837,"height":11}},{"id":"107710fc-1e87-4ab8-9004-7622a9a286ad","block_type":"box","text":"is on file with the Fund or who, to the Fund’s knowledge, have furnished an incorrect number. When establishing an","page_number":180,"box":{"x":70,"y":188,"width":821,"height":12}},{"id":"014e2e07-eb65-4d94-a0b5-7a4159e81cbc","block_type":"box","text":"account, an investor must cer tify under penalty of perjury that such number is correct and that such investor is not","page_number":180,"box":{"x":69,"y":203,"width":819,"height":12}},{"id":"396532b9-adb8-4c80-9f7a-c6a8c587eabb","block_type":"box","text":"otherwise subject to backup withholding. Backup withholding is not an additional tax. Any amount withheld generally","page_number":180,"box":{"x":69,"y":219,"width":826,"height":11}},{"id":"767b8d3a-1371-4001-ae38-4f065e6164d4","block_type":"box","text":"may be allowed as a refund or a credit against a shareholder’s U.S. federal income tax liability, provided that the","page_number":180,"box":{"x":69,"y":234,"width":802,"height":11}},{"id":"1e0937f9-354c-4f3b-b908-0796079b0b57","block_type":"box","text":"required information is timely forwarded to the IRS.","page_number":180,"box":{"x":69,"y":249,"width":364,"height":11}},{"id":"7844be65-cddd-4254-afe6-4f211b434b37","block_type":"box","text":"If a shareholder recognizes a loss with respect to a Fund’s shares of at least $2 million in any single taxable","page_number":180,"box":{"x":102,"y":271,"width":774,"height":12}},{"id":"5dccb387-126a-4951-95a3-426c71bd21c8","block_type":"box","text":"year or $4 million in any combination of taxable years for an individual shareholder or $10 million in any single","page_number":180,"box":{"x":68,"y":286,"width":787,"height":12}},{"id":"b71d829c-12d9-4fe4-8460-7a8267cb2c3f","block_type":"box","text":"taxable year or $20 million in any combination of taxable years for a corporate shareholder in any single taxable year,","page_number":180,"box":{"x":68,"y":301,"width":835,"height":12}},{"id":"4e07bc8c-a2cd-4574-80b7-bc9fe4fd5841","block_type":"box","text":"the shareholder must file a disclosure statement on IRS Form 8886 with the IRS. Direct shareholders of por tfolio","page_number":180,"box":{"x":68,"y":317,"width":809,"height":11}},{"id":"6cda9812-c0e2-404d-9bdf-a6a8ddeacda2","block_type":"box","text":"securities are in many cases exempted. That a loss is repor table under these regulations does not affect the legal","page_number":180,"box":{"x":69,"y":332,"width":817,"height":11}},{"id":"7cd819a8-05e8-4944-90cf-2742231c5b73","block_type":"box","text":"determination of whether the taxpayer’s treatment of the loss is proper. Shareholders should consult their tax","page_number":180,"box":{"x":69,"y":347,"width":783,"height":11}},{"id":"5be7eb8d-c9f0-4ee5-89a1-8ee2f02d10a2","block_type":"box","text":"advisors to determine the applicability of these regulations in light of their individual circumstances.","page_number":180,"box":{"x":69,"y":362,"width":710,"height":11}},{"id":"3ff8683a-d2ff-4d35-a956-ee45d121bdd0","block_type":"box","text":"Cer tain types of income received by a Fund from REITs, real estate mor tgage investment conduits, taxable","page_number":180,"box":{"x":102,"y":385,"width":758,"height":11}},{"id":"9c01d900-8baa-4cdc-a08e-fa2b38ecbe9c","block_type":"box","text":"mor tgage pools or other investments may cause the Fund to repor t some or all of its distributions as “excess","page_number":180,"box":{"x":69,"y":400,"width":782,"height":11}},{"id":"f3b9df79-3248-44c0-a539-523f825f1c72","block_type":"box","text":"inclusion income.” To Fund shareholders, such excess inclusion income may: (i) constitute taxable income, as","page_number":180,"box":{"x":70,"y":415,"width":783,"height":11}},{"id":"df755c39-feb0-4514-a6f6-a2f59874ceec","block_type":"box","text":"unrelated business taxable income (“UBTI”) for those shareholders who would otherwise be tax-exempt such as","page_number":180,"box":{"x":69,"y":430,"width":797,"height":11}},{"id":"8e4381f7-34a3-45b8-a44f-7942fd2223e5","block_type":"box","text":"individual retirement accounts, 401(k) accounts, Keogh plans, pension plans and cer tain charitable entities; (ii) not","page_number":180,"box":{"x":70,"y":445,"width":822,"height":12}},{"id":"0c08699b-2fde-48f7-b757-1125da0afb61","block_type":"box","text":"be offset by otherwise allowable deductions for tax purposes; (iii) not be eligible for reduced U.S. withholding for non","page_number":180,"box":{"x":69,"y":460,"width":836,"height":12}},{"id":"3370fd1c-788c-4bd6-812f-1be322a401e5","block_type":"box","text":"U.S. shareholders even from tax treaty countries; and (iv) cause the Fund to be subject to tax if cer tain “disqualified","page_number":180,"box":{"x":70,"y":475,"width":826,"height":12}},{"id":"224e8fd7-4595-4504-a2ac-3d0cb7278610","block_type":"box","text":"organizations,” as defined by the Code, are Fund shareholders. The Fund tries to avoid investing in REITs that are","page_number":180,"box":{"x":69,"y":491,"width":808,"height":11}},{"id":"69e83835-1e3a-4d9d-9f9d-60a697c23d01","block_type":"box","text":"expected to generate excess inclusion income, but the Fund may not always be successful in doing so. Because","page_number":180,"box":{"x":69,"y":506,"width":800,"height":11}},{"id":"23b821a5-e216-4813-a35e-a7f8f2c5c81f","block_type":"box","text":"information about a REIT’s investments may be inadequate or inaccurate, or because a REIT may change its","page_number":180,"box":{"x":70,"y":521,"width":770,"height":11}},{"id":"5947c8e7-1506-40c6-9159-cbfe367be2b7","block_type":"box","text":"investment program, the Fund may not be successful in avoiding the consequences described above. Avoidance of","page_number":180,"box":{"x":70,"y":536,"width":816,"height":11}},{"id":"a7aec515-c72e-4a5d-831f-d82c2e24950a","block_type":"box","text":"investments in REITs that generate excess inclusion income may require the Fund to forego otherwise attractive","page_number":180,"box":{"x":70,"y":551,"width":796,"height":11}},{"id":"420427da-0d3e-4686-a540-d85d40f72e1e","block_type":"box","text":"investment oppor tunities.","page_number":180,"box":{"x":70,"y":566,"width":180,"height":11}},{"id":"17726aad-0e7b-4fd9-8455-1e49acc458ce","block_type":"box","text":"Dividends and interest received and capital gains realized by a Fund may give rise to withholding and other taxes","page_number":180,"box":{"x":102,"y":589,"width":801,"height":11}},{"id":"7be26416-6be9-4fe5-8dc5-34aa9b0f5c79","block_type":"box","text":"imposed by foreign countries. Tax conventions between cer tain foreign countries and the United States may reduce or","page_number":180,"box":{"x":70,"y":604,"width":839,"height":11}},{"id":"61a8661a-b189-4f56-92fe-14705a2d967c","block_type":"box","text":"eliminate such taxes. Shareholders of a Fund more than 50% by value of the assets of which at the close of a taxable","page_number":180,"box":{"x":69,"y":619,"width":840,"height":11}},{"id":"7f8ce09d-2697-48b5-b301-97e7df08f1fd","block_type":"box","text":"year are foreign securities may be able to claim U.S. foreign tax credits with respect to such foreign taxes paid by the","page_number":180,"box":{"x":68,"y":634,"width":837,"height":12}},{"id":"b42b42eb-3f48-4eab-99ad-daaa183baa67","block_type":"box","text":"Fund, subject to cer tain requirements and limitations contained in the Code. For example, cer tain retirement","page_number":180,"box":{"x":70,"y":649,"width":774,"height":11}},{"id":"6fd97fc7-218a-4758-a602-84106a2a0682","block_type":"box","text":"accounts and cer tain tax-exempt organizations cannot claim foreign tax credits on investments in foreign securities","page_number":180,"box":{"x":69,"y":664,"width":820,"height":12}},{"id":"4fd3184b-fcb5-4c5e-a73a-8b1ed2b68a3b","block_type":"box","text":"held in a Fund. In addition, a foreign tax credit may be claimed with respect to withholding tax on payments with","page_number":180,"box":{"x":69,"y":680,"width":795,"height":11}},{"id":"60636313-85be-402b-b6a0-1e5f2ad1cc28","block_type":"box","text":"respect to a security only if the holder of the security meets cer tain holding period requirements. Both the","page_number":180,"box":{"x":69,"y":695,"width":755,"height":11}},{"id":"b76a905d-ebfc-46ab-b676-b67b72056300","block_type":"box","text":"shareholder and the Fund must meet these holding period requirements, and if a Fund fails to do so, it will not be","page_number":180,"box":{"x":69,"y":710,"width":811,"height":11}},{"id":"11467e83-0deb-47e0-b6ca-20124fa2261c","block_type":"box","text":"able to “pass through” to shareholders the ability to claim a credit or a deduction for the related foreign taxes paid by","page_number":180,"box":{"x":69,"y":725,"width":839,"height":11}},{"id":"5ee41851-df9b-4d53-8bf4-5dddbf0e3f6a","block_type":"box","text":"the Fund. Fur ther, to the extent that a Fund engages in securities lending with respect to a security paying income","page_number":180,"box":{"x":68,"y":740,"width":812,"height":11}},{"id":"010b16a9-97e6-404e-aeea-efe2b72414b1","block_type":"box","text":"subject to foreign taxes, it may not be able to pass through to its shareholders the ability to take a foreign tax credit","page_number":180,"box":{"x":69,"y":755,"width":829,"height":11}},{"id":"e4ab6abc-13bf-4aa5-a4e8-46d2299d45b8","block_type":"box","text":"for those taxes. If a Fund satisfies the applicable requirements, such Fund will be eligible to file an election with the","page_number":180,"box":{"x":68,"y":770,"width":827,"height":12}},{"id":"61448481-9fa5-4609-bf70-6833e60b4cf7","block_type":"box","text":"IRS pursuant to which shareholders of the Fund will be required to include their propor tionate shares of such foreign","page_number":180,"box":{"x":70,"y":785,"width":829,"height":12}},{"id":"84677905-8432-435d-8a97-f77552d510d9","block_type":"box","text":"taxes in their U.S. income tax returns as gross income, treat such propor tionate shares as taxes paid by them, and","page_number":180,"box":{"x":68,"y":801,"width":825,"height":11}},{"id":"70af41fe-013c-4278-9deb-53bf25d173f2","block_type":"box","text":"deduct such propor tionate shares in computing their taxable incomes or, alternatively, use them as foreign tax","page_number":180,"box":{"x":69,"y":816,"width":788,"height":11}},{"id":"fe22908f-58d4-46dd-af9c-4397cecdc907","block_type":"box","text":"credits against their U.S. income taxes. No deductions for foreign taxes, however, may be claimed by noncorporate","page_number":180,"box":{"x":69,"y":831,"width":818,"height":11}},{"id":"f5c27444-2dbc-481f-9295-39ae9eec8bdc","block_type":"box","text":"shareholders who do not itemize deductions. A shareholder that is a nonresident alien individual or a foreign","page_number":180,"box":{"x":69,"y":846,"width":773,"height":11}},{"id":"ee212fd3-bd65-4ba5-a8bd-e21b4d24ad07","block_type":"box","text":"corporation may be subject to U.S. withholding tax on the income resulting from a Fund’s election described in this","page_number":180,"box":{"x":69,"y":861,"width":817,"height":11}},{"id":"ba33f4dd-b690-4d9d-a830-c6dedd34c1ba","block_type":"box","text":"paragraph but may not be able to claim a credit or deduction against such U.S. tax for the foreign taxes treated as","page_number":180,"box":{"x":70,"y":876,"width":814,"height":11}},{"id":"d461cbd9-c079-4045-bd6e-e5210350405d","block_type":"box","text":"having been paid by such shareholder. A Fund will repor t annually to its shareholders the amount per share of such","page_number":180,"box":{"x":69,"y":891,"width":821,"height":12}},{"id":"6a55d194-92b7-4027-b1c9-fe37d5007473","block_type":"box","text":"foreign taxes and other information needed to claim the foreign tax credit.","page_number":180,"box":{"x":68,"y":906,"width":527,"height":12}},{"id":"b4ab04f0-efe9-44e8-9839-db54065506b6","block_type":"box","text":"II-133","page_number":180,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"ab43ac9a-d460-4ef9-9e9d-5421b7b84da3","block_type":"box","text":"NM1026U-6033063-180/246","page_number":180,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"d7ea6312-7611-46b9-b833-ed2ca7918783","block_type":"box","text":"Cer tain transactions entered into by the Funds are subject to special tax rules of the Code that may, among","page_number":181,"box":{"x":102,"y":45,"width":768,"height":11}},{"id":"2a1d6bc5-368b-465a-9932-36beb64125ad","block_type":"box","text":"other things, (a) affect the character of gains and losses realized, (b) disallow, suspend or otherwise limit the","page_number":181,"box":{"x":69,"y":60,"width":780,"height":11}},{"id":"4ee8d865-c183-4659-88df-8beb7e8a48e2","block_type":"box","text":"allowance of cer tain losses or deductions, and (c) accelerate the recognition of income without a corresponding","page_number":181,"box":{"x":69,"y":75,"width":797,"height":11}},{"id":"0a5306d4-335c-4d7c-8abd-ca9e87822bc2","block_type":"box","text":"receipt of cash (with which to make the necessary distributions to satisfy distribution requirements applicable to","page_number":181,"box":{"x":69,"y":90,"width":802,"height":11}},{"id":"10e0b0d2-4c39-40f0-8407-d9a48d6debf6","block_type":"box","text":"regulated investment companies). Operation of these rules could, therefore, affect the character, amount and timing","page_number":181,"box":{"x":69,"y":105,"width":831,"height":11}},{"id":"6f0bf6ce-abd6-4273-9460-16134e46f03f","block_type":"box","text":"of distributions to shareholders. Special tax rules also may require a Fund to mark-to-market cer tain types of","page_number":181,"box":{"x":69,"y":120,"width":776,"height":11}},{"id":"cf592289-0a95-47ad-b20b-73b3266eaf41","block_type":"box","text":"positions in its por tfolio (","page_number":181,"box":{"x":70,"y":135,"width":177,"height":11}},{"id":"ede07fdf-e824-41cf-9db3-794fb5b8d64f","block_type":"box","text":"i.e.","page_number":181,"box":{"x":249,"y":136,"width":20,"height":8}},{"id":"fa93bf5b-7964-47a1-b111-9a14b09048b0","block_type":"box","text":", treat them as sold on the last day of the taxable year), and may result in the recognition","page_number":181,"box":{"x":272,"y":135,"width":636,"height":12}},{"id":"540c6c87-5609-46de-bcb0-27782b59a1d0","block_type":"box","text":"of income without a corresponding receipt of cash. Funds engaging in transactions affected by these provisions","page_number":181,"box":{"x":69,"y":150,"width":795,"height":12}},{"id":"734c8ea1-248f-4be3-92c5-50712b550812","block_type":"box","text":"intend to monitor their transactions, make appropriate tax elections and make appropriate entries in their books and","page_number":181,"box":{"x":70,"y":166,"width":830,"height":11}},{"id":"35f1fea6-a531-4b94-b3fb-f3590469551e","block_type":"box","text":"records to lessen the effect of these tax rules and avoid any possible disqualification from the special treatment","page_number":181,"box":{"x":69,"y":181,"width":804,"height":11}},{"id":"4d5e0e3c-5f6a-4201-b62c-c54b1e8aead0","block_type":"box","text":"afforded regulated investment companies under the Code.","page_number":181,"box":{"x":69,"y":196,"width":415,"height":11}},{"id":"beeee186-3d00-465c-943c-822c10cd66aa","block_type":"box","text":"Cer tain of a Fund’s investments in derivative instruments and foreign currency-denominated instruments, and","page_number":181,"box":{"x":102,"y":218,"width":781,"height":12}},{"id":"ad7bb6f5-efff-4fed-b051-a59cc354e5f8","block_type":"box","text":"any of the Fund’s transactions in foreign currencies and hedging activities, are likely to produce a difference between","page_number":181,"box":{"x":69,"y":234,"width":835,"height":11}},{"id":"43b6e972-0362-4add-b3f7-ca5493e3196a","block_type":"box","text":"its book income and the sum of its taxable income and net tax-exempt income (if any). If such a difference arises,","page_number":181,"box":{"x":70,"y":249,"width":811,"height":11}},{"id":"4410cde9-20b3-4104-8190-51cddb1b0393","block_type":"box","text":"and the Fund’s book income is less than the sum of its taxable income and net tax-exempt income, the Fund could","page_number":181,"box":{"x":69,"y":264,"width":818,"height":11}},{"id":"2aeb7451-167f-43f3-b098-458fcc37a335","block_type":"box","text":"be required to make distributions exceeding book income to qualify as a RIC that is accorded special tax treatment","page_number":181,"box":{"x":69,"y":279,"width":820,"height":11}},{"id":"f70e3202-ac41-431f-a80e-43d0a6e80ee3","block_type":"box","text":"and to avoid an entity-level tax. In the alternative, if the Fund makes any distribution based on book income and such","page_number":181,"box":{"x":69,"y":294,"width":834,"height":11}},{"id":"3724c242-29e6-4b52-af26-c35d54857237","block_type":"box","text":"book income exceeds the sum of its taxable income (including realized capital gains) and net tax-exempt income, the","page_number":181,"box":{"x":69,"y":309,"width":833,"height":11}},{"id":"7d81b76a-b73e-493f-a4cf-b3f2af830af3","block_type":"box","text":"distribution (if any) of such excess generally will be treated as (i) a dividend to the extent of the Fund’s remaining","page_number":181,"box":{"x":69,"y":324,"width":805,"height":12}},{"id":"c3559d3e-0044-40e8-8e80-937daeb78b38","block_type":"box","text":"earnings and profits (including earnings and profits arising from tax-exempt income), (ii) thereafter, as a return of","page_number":181,"box":{"x":69,"y":339,"width":805,"height":12}},{"id":"fddd53f8-c2bd-470a-b4ac-94ada23a019d","block_type":"box","text":"capital to the extent of the recipient’s basis in its shares, and (iii) thereafter as gain from the sale or exchange of a","page_number":181,"box":{"x":69,"y":355,"width":822,"height":11}},{"id":"cf625d4c-d2cc-47a9-9e2e-a2c6d1e8b0b2","block_type":"box","text":"capital asset.","page_number":181,"box":{"x":69,"y":370,"width":95,"height":11}},{"id":"aa8718fb-e63f-4bb7-b225-4434b36be792","block_type":"box","text":"If a Fund invests in underlying funds, the Fund’s realized losses on sales of shares of underlying funds may be","page_number":181,"box":{"x":102,"y":392,"width":787,"height":12}},{"id":"c40e652f-e7a3-432f-b184-6a9963de64cb","block_type":"box","text":"indefinitely or permanently deferred as “wash sales.” Distributions of shor t-term capital gains by underlying funds will","page_number":181,"box":{"x":70,"y":407,"width":836,"height":12}},{"id":"61fab272-38fb-404b-988b-695bd0cf1af2","block_type":"box","text":"be recognized as ordinary income by the Fund and would not be offset by the Fund’s capital loss carryforwards, if","page_number":181,"box":{"x":69,"y":423,"width":812,"height":11}},{"id":"35a8ae7a-75e3-4d56-87a0-e8990a794e9c","block_type":"box","text":"any. Capital loss carryforwards of underlying funds, if any, would not offset net capital gains of the Fund. Each of","page_number":181,"box":{"x":69,"y":438,"width":805,"height":11}},{"id":"6528aefb-bb49-4a7f-878c-b60646db2283","block_type":"box","text":"these effects is caused by the Fund’s expected investment in the underlying funds and may result in distributions to","page_number":181,"box":{"x":68,"y":453,"width":829,"height":11}},{"id":"44781ab5-d956-4a6a-bd6c-f093f195dab7","block_type":"box","text":"Fund shareholders being of higher magnitudes and less likely to qualify for lower capital gain tax rates than if the","page_number":181,"box":{"x":70,"y":468,"width":803,"height":11}},{"id":"9b2f07b4-5ea5-4d50-9830-7571493e6bc5","block_type":"box","text":"Fund were to invest otherwise.","page_number":181,"box":{"x":70,"y":483,"width":216,"height":9}},{"id":"566896f0-b1ff-4231-83de-69a04d94db4a","block_type":"box","text":"A Fund may take cer tain positions through a wholly-owned (or majority-owned), foreign subsidiary (the","page_number":181,"box":{"x":101,"y":506,"width":721,"height":11}},{"id":"3d02a353-ca0f-4304-abae-b673c3f2db0f","block_type":"box","text":"“Subsidiary”). It is expected that the Subsidiary will be a “controlled foreign corporation” and that all of its net","page_number":181,"box":{"x":70,"y":521,"width":787,"height":11}},{"id":"8614c502-061b-411d-a2ff-1c37463a44be","block_type":"box","text":"income will be “subpar t F income” for U.S. federal income tax purposes. If that is the case, the Fund will be required","page_number":181,"box":{"x":70,"y":536,"width":831,"height":11}},{"id":"15fa8062-01ad-4d6a-9399-707e5aaa2f3a","block_type":"box","text":"to repor t all of the Subsidiary’s net income as ordinary income regardless of whether that income would be treated","page_number":181,"box":{"x":68,"y":551,"width":823,"height":11}},{"id":"d0a374f6-cd59-4806-855d-1edf11823c79","block_type":"box","text":"differently (for example, as capital gain) at the Subsidiary level and regardless of whether that income is distributed","page_number":181,"box":{"x":69,"y":566,"width":825,"height":11}},{"id":"ef3707c7-36f3-4257-a25a-5c62c9cbcc63","block_type":"box","text":"to the Fund. (Previously taxed income will not, however, be taxable again when distributed.) If a net loss is realized by","page_number":181,"box":{"x":68,"y":581,"width":838,"height":12}},{"id":"dd144b5a-a087-48b5-909b-31f464fc8546","block_type":"box","text":"the Subsidiary in any taxable year, the loss will generally not be available to offset the Fund’s other income. It is not","page_number":181,"box":{"x":68,"y":596,"width":830,"height":12}},{"id":"091cf05c-0f87-421f-ac4d-300190fdcb78","block_type":"box","text":"expected that the Subsidiary will be subject to an entity-level federal tax.","page_number":181,"box":{"x":69,"y":612,"width":515,"height":11}},{"id":"f5fe0667-55b0-4e3f-897a-673fced14688","block_type":"box","text":"If a Fund purchases shares of an investment company (or similar investment entity) organized under foreign law,","page_number":181,"box":{"x":102,"y":634,"width":798,"height":12}},{"id":"82888a6a-8250-453e-8a5b-8bf6e7746c72","block_type":"box","text":"the Fund will generally be treated as owning shares in a passive foreign investment company (“PFIC”) for U.S. federal","page_number":181,"box":{"x":68,"y":649,"width":835,"height":12}},{"id":"e442b300-4eda-4e5a-9e67-05d3080918a2","block_type":"box","text":"income tax purposes. A Fund may be subject to U.S. federal income tax, and interest charges (at the rate applicable","page_number":181,"box":{"x":70,"y":664,"width":827,"height":12}},{"id":"7c9c8dd6-14dd-4c27-819e-5cc6cb62b3dc","block_type":"box","text":"to tax underpayments) on tax liability treated as having been deferred with respect to cer tain distributions from such","page_number":181,"box":{"x":68,"y":680,"width":830,"height":11}},{"id":"2485d669-da65-4e76-8dac-35d397678110","block_type":"box","text":"a company and on gain from the disposition of the shares of such a company (collectively referred to as “excess","page_number":181,"box":{"x":69,"y":695,"width":802,"height":11}},{"id":"c2712277-6522-487a-b042-6f1c305059db","block_type":"box","text":"distributions”), even if such excess distributions are paid by the Fund as a dividend to its shareholders. However, a","page_number":181,"box":{"x":69,"y":710,"width":821,"height":11}},{"id":"408b1d82-db39-44c1-8983-b483bcb85b54","block_type":"box","text":"Fund may elect to “mark-to-market” at the end of each taxable year shares that it holds in PFICs. The election is","page_number":181,"box":{"x":70,"y":725,"width":797,"height":11}},{"id":"21c2e1e0-5c06-4804-aa80-e2fc2984c22d","block_type":"box","text":"made separately for each PFIC held and, once made, would be effective for all subsequent taxable years, unless","page_number":181,"box":{"x":69,"y":740,"width":801,"height":11}},{"id":"e3cf19de-013d-4980-82ff-e0e999ab93fa","block_type":"box","text":"revoked with consent from the IRS. Under this election, a Fund would recognize as ordinary income any increase in","page_number":181,"box":{"x":69,"y":755,"width":818,"height":11}},{"id":"06a45581-6fe3-4392-81a4-e09f5c8608be","block_type":"box","text":"the value of its shares as of the close of the taxable year over their adjusted tax basis and as ordinary loss any","page_number":181,"box":{"x":68,"y":770,"width":797,"height":11}},{"id":"29d74bef-d492-4839-8e61-16a528fd877b","block_type":"box","text":"decrease in such value, but only to the extent of previously recognized “mark-to-market” gains. By making the mark","page_number":181,"box":{"x":69,"y":785,"width":824,"height":12}},{"id":"dd93e7a1-a18a-44dc-b030-1dde620db4a9","block_type":"box","text":"to-market election, a Fund could avoid imposition of the interest charge with respect to excess distributions from","page_number":181,"box":{"x":68,"y":801,"width":804,"height":11}},{"id":"4b8a29c7-f50a-4ead-8e82-bc7a66dac7fb","block_type":"box","text":"PFICs, but in any par ticular year might be required to recognize income in excess of the distributions it received from","page_number":181,"box":{"x":69,"y":816,"width":831,"height":11}},{"id":"eba05bc8-039b-4a01-a0e6-336ebb0212ef","block_type":"box","text":"PFICs.","page_number":181,"box":{"x":69,"y":831,"width":42,"height":9}},{"id":"c102003e-f15a-424e-8bbb-38482964358b","block_type":"box","text":"If a Fund were to invest in a PFIC and elect to treat the PFIC as a “qualified electing fund” under the Code, in lieu","page_number":181,"box":{"x":102,"y":853,"width":804,"height":12}},{"id":"3b7bdc76-3d96-4a05-ba00-f918eb5fa580","block_type":"box","text":"of the foregoing requirements, the Fund would be required to include in income each year a por tion of the ordinary","page_number":181,"box":{"x":69,"y":869,"width":816,"height":11}},{"id":"34039af4-ea93-479b-8e4e-6693484bed04","block_type":"box","text":"earnings and net capital gains of the qualified electing fund, even if not distributed to the Fund, and such amounts","page_number":181,"box":{"x":69,"y":884,"width":816,"height":11}},{"id":"ec2c9dd1-22f2-492d-ac26-d5c5ecf79c0a","block_type":"box","text":"would be subject to the 90% and excise tax distribution requirements described above. In order to make this election,","page_number":181,"box":{"x":68,"y":899,"width":840,"height":11}},{"id":"31945684-77ed-40d1-8f60-9a94d3a2987e","block_type":"box","text":"II-134","page_number":181,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"3030bc0c-f22c-4cfb-b5c3-1db5c5435013","block_type":"box","text":"NM1026U-6033063-181/246","page_number":181,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"c0a8e83b-7eb4-4309-a460-8c8df0aa561c","block_type":"box","text":"the Fund would be required to obtain cer tain annual information from the PFICs in which it invests, which may be","page_number":182,"box":{"x":68,"y":45,"width":804,"height":11}},{"id":"f3add810-ba89-4ef2-8d54-83cea46564b1","block_type":"box","text":"difficult or impossible to obtain.","page_number":182,"box":{"x":69,"y":60,"width":225,"height":11}},{"id":"db9d3c0f-822f-4d21-8d71-ec42294db72f","block_type":"box","text":"In cer tain situations, a Fund may, for a taxable year, defer all or a por tion of its net capital loss (or if there is no","page_number":182,"box":{"x":102,"y":82,"width":796,"height":12}},{"id":"11ba718a-53ab-4762-ba3c-d7cfd11b913c","block_type":"box","text":"net capital loss, any net long-term or shor t-term capital loss) realized after October and its late-year ordinary loss","page_number":182,"box":{"x":69,"y":98,"width":806,"height":11}},{"id":"b41dfc79-1841-46aa-b766-f1f0b820b1e7","block_type":"box","text":"(defined as the sum of the excess of post-October foreign currency and PFIC losses over post-October foreign","page_number":182,"box":{"x":69,"y":113,"width":778,"height":11}},{"id":"509d6680-39fc-4d48-8ad0-ced38b8e7083","block_type":"box","text":"currency and PFIC gains plus the excess of post-December ordinary losses over post-December ordinary income) until","page_number":182,"box":{"x":69,"y":128,"width":838,"height":11}},{"id":"7ef83b0a-f9af-4f80-afeb-c4b4d31d65a6","block_type":"box","text":"the next taxable year in computing its investment company taxable income and net capital gain, which will defer the","page_number":182,"box":{"x":68,"y":143,"width":824,"height":11}},{"id":"35fa4996-e290-4b83-b555-9ce404591eb7","block_type":"box","text":"recognition of such realized losses. Such deferrals and other rules regarding gains and losses realized after October","page_number":182,"box":{"x":69,"y":158,"width":830,"height":11}},{"id":"4365da07-c650-4b0a-acab-6e2a91d3292b","block_type":"box","text":"(or December) may affect the tax character of shareholder distributions.","page_number":182,"box":{"x":69,"y":173,"width":511,"height":11}},{"id":"89fae73b-0a6a-415e-b98e-0b6dd6e4b6d4","block_type":"box","text":"Municipal Funds","page_number":182,"box":{"x":102,"y":196,"width":115,"height":11}},{"id":"a0c03043-0174-41cb-bcce-3341c72ac7f3","block_type":"box","text":"Each Municipal Fund intends to qualify to pay “exempt-interest dividends” as defined in Section 852(b)(5) of the","page_number":182,"box":{"x":102,"y":218,"width":798,"height":12}},{"id":"5d93e89d-c312-4dc0-83c4-c3ddb50a73b7","block_type":"box","text":"Code. Under such section if, at the close of each quar ter of a Fund’s taxable year, at least 50% of the value of the","page_number":182,"box":{"x":69,"y":234,"width":815,"height":11}},{"id":"c6d5af0f-78ab-4cbe-b9a0-565b74928252","block_type":"box","text":"Fund’s total assets consists of obligations exempt from U.S. federal income tax (“tax-exempt obligations”) under","page_number":182,"box":{"x":70,"y":249,"width":803,"height":11}},{"id":"73a3f2c4-a0ec-40f8-863f-ffa58e82730a","block_type":"box","text":"Section 103(a) of the Code (relating generally to obligations of a state or local governmental unit), the Fund shall be","page_number":182,"box":{"x":69,"y":264,"width":826,"height":11}},{"id":"c621974c-5ad6-4bf0-acfc-e7b9623e62f2","block_type":"box","text":"qualified to pay exempt-interest dividends to holders of all outstanding classes of its shares (together the","page_number":182,"box":{"x":69,"y":279,"width":752,"height":11}},{"id":"bed03d8c-f288-4fa4-a80c-a22814bf357f","block_type":"box","text":"“shareholders”). Exempt-interest dividends are dividends or any par t thereof paid by a Fund that are attributable to","page_number":182,"box":{"x":70,"y":294,"width":817,"height":11}},{"id":"bd143de9-9ded-4619-9b45-a1dee92d4f66","block_type":"box","text":"interest on tax-exempt obligations and repor ted by the Fund as exempt-interest dividends. A Fund will allocate","page_number":182,"box":{"x":70,"y":309,"width":780,"height":11}},{"id":"1a50a127-0d66-4f93-b10d-80c0f02ea321","block_type":"box","text":"interest from tax-exempt obligations (as well as ordinary income, capital gains and tax preference items discussed","page_number":182,"box":{"x":70,"y":324,"width":815,"height":12}},{"id":"dc909c1d-46c7-4220-8fb0-81afa52e379b","block_type":"box","text":"below) among the Fund’s shareholders according to a method (that it believes is consistent with the Commission rule","page_number":182,"box":{"x":69,"y":340,"width":839,"height":11}},{"id":"60f59a47-f6a3-4225-8dbe-6188d876d78a","block_type":"box","text":"permitting the issuance and sale of multiple classes of shares) that is based upon the gross income that is allocable","page_number":182,"box":{"x":70,"y":355,"width":835,"height":11}},{"id":"637d90f2-6d97-4929-80e1-75e61bf6dc8d","block_type":"box","text":"to each class of shareholders during the taxable year, or such other method as the IRS may prescribe.","page_number":182,"box":{"x":68,"y":370,"width":730,"height":11}},{"id":"a36013b8-3594-41c8-ad66-7ff45e6d8591","block_type":"box","text":"Exempt-interest dividends will be excludable from a shareholder’s gross income for U.S. federal income tax","page_number":182,"box":{"x":102,"y":392,"width":763,"height":12}},{"id":"2f918523-2b00-468f-ad35-c47fb1483037","block_type":"box","text":"purposes. Exempt-interest dividends are included, however, in determining the por tion, if any, of a person’s social","page_number":182,"box":{"x":70,"y":407,"width":809,"height":12}},{"id":"6bf73565-90f9-4904-ac10-d340d2eaa600","block_type":"box","text":"security and railroad retirement benefits subject to U.S. federal income taxes. Interest on indebtedness incurred or","page_number":182,"box":{"x":69,"y":423,"width":821,"height":11}},{"id":"dd46ff85-a700-404a-a6c4-d2b707b3dd78","block_type":"box","text":"continued to purchase or carry shares of a regulated investment company paying exempt-interest dividends, such as","page_number":182,"box":{"x":69,"y":438,"width":831,"height":11}},{"id":"0a3e06f3-62de-4dde-92c4-4433f694d3c4","block_type":"box","text":"the Fund, will not be deductible by the investor for U.S. federal income tax purposes to the extent attributable to","page_number":182,"box":{"x":68,"y":453,"width":800,"height":11}},{"id":"a770332b-8b80-4bb6-8b47-9454680a2652","block_type":"box","text":"exempt-interest dividends. Shareholders are advised to consult their tax advisors with respect to whether exempt","page_number":182,"box":{"x":69,"y":468,"width":810,"height":11}},{"id":"1ae31470-e176-4b2d-a302-04a7f7817309","block_type":"box","text":"interest dividends retain the exclusion under Code Section 103(a) if a shareholder would be treated as a “substantial","page_number":182,"box":{"x":70,"y":483,"width":836,"height":11}},{"id":"bc8cebff-0da4-4c87-b7b2-73d6191a56ac","block_type":"box","text":"user” or “related person” under Code Section 147(a) with respect to proper ty financed with the proceeds of an issue","page_number":182,"box":{"x":69,"y":498,"width":835,"height":11}},{"id":"bb400aa8-63ad-4968-9640-aae295f0004d","block_type":"box","text":"of PABs, if any, held by a Fund.","page_number":182,"box":{"x":69,"y":513,"width":217,"height":11}},{"id":"33f159dd-c756-442c-85b5-6d185a811574","block_type":"box","text":"Substitute payments received by a Fund representing interest paid on tax-exempt obligations loaned out by the","page_number":182,"box":{"x":102,"y":536,"width":788,"height":11}},{"id":"8ed9d563-9799-47af-9720-c7c5fffa3d63","block_type":"box","text":"Fund will not be considered exempt interest, and distributions by the Fund of such substitute payments will not","page_number":182,"box":{"x":70,"y":551,"width":790,"height":11}},{"id":"00eb7d68-45b1-4403-8266-06aee5ab835c","block_type":"box","text":"constitute exempt-interest dividends.","page_number":182,"box":{"x":69,"y":566,"width":261,"height":11}},{"id":"2e085c2e-d4a3-4b4e-9725-196a5c171510","block_type":"box","text":"Distributions in excess of a Fund’s earnings and profits will first reduce the adjusted tax basis of a holder’s","page_number":182,"box":{"x":102,"y":589,"width":765,"height":11}},{"id":"16fdb934-cc59-4820-8ac2-32d43d1c6dec","block_type":"box","text":"shares and, after such adjusted tax basis is reduced to zero, will constitute capital gains to such holder (assuming","page_number":182,"box":{"x":69,"y":604,"width":819,"height":11}},{"id":"17b7b259-bab7-4bb6-885f-2d92554fb684","block_type":"box","text":"the shares are held as a capital asset). Any loss upon the sale or exchange of Fund shares held for six months or","page_number":182,"box":{"x":68,"y":619,"width":813,"height":11}},{"id":"3dccc408-152b-4b63-8aa7-bf1ef92fa6be","block_type":"box","text":"less will be disallowed to the extent of any exempt-interest dividends received by the shareholder. In addition, any","page_number":182,"box":{"x":70,"y":634,"width":809,"height":11}},{"id":"42910c8f-9a11-4a6c-a6dc-1a625f32a4bd","block_type":"box","text":"such loss that is not disallowed under the rule stated above will be treated as long-term capital loss to the extent of","page_number":182,"box":{"x":69,"y":649,"width":829,"height":12}},{"id":"d6088851-9ef7-4b31-acfb-b2977ffcaefc","block_type":"box","text":"any capital gain dividends received by the shareholder.","page_number":182,"box":{"x":69,"y":665,"width":388,"height":11}},{"id":"8e9d31d9-e3c5-4766-86ee-f4448e8c5df7","block_type":"box","text":"All or a por tion of a Fund’s gains from the sale or redemption of tax-exempt obligations purchased at a market","page_number":182,"box":{"x":101,"y":687,"width":787,"height":11}},{"id":"8cfd5309-cef7-4950-bd23-c8a7f053c780","block_type":"box","text":"discount will be treated as ordinary income rather than capital gain. This rule may increase the amount of ordinary","page_number":182,"box":{"x":69,"y":702,"width":817,"height":12}},{"id":"4361da8e-b0a0-4576-a0c6-e7dde195ab14","block_type":"box","text":"income dividends received by shareholders.","page_number":182,"box":{"x":70,"y":718,"width":309,"height":11}},{"id":"e1d39ed1-d394-4702-bada-1240f9f98134","block_type":"box","text":"Any market discount recognized on a bond is taxable as ordinary income. A market discount bond is a bond","page_number":182,"box":{"x":101,"y":740,"width":766,"height":11}},{"id":"7c9b27ef-b205-4f6c-b39e-b09f173b4a92","block_type":"box","text":"acquired in the secondary market at a price below redemption value or adjusted issue price if issued with original","page_number":182,"box":{"x":69,"y":755,"width":808,"height":11}},{"id":"101059eb-7ef9-4370-b5f6-a14c802abee5","block_type":"box","text":"issue discount. Absent an election by the Fund to include the market discount in income as it accrues, gain on the","page_number":182,"box":{"x":70,"y":771,"width":815,"height":11}},{"id":"54ab730c-c71b-4f87-86dc-686bc2cdc0dd","block_type":"box","text":"Fund’s disposition of such an obligation will be treated as ordinary income rather than capital gain to the extent of","page_number":182,"box":{"x":70,"y":785,"width":815,"height":12}},{"id":"0585bafb-4d89-409c-b774-a46351f2791d","block_type":"box","text":"the accrued market discount.","page_number":182,"box":{"x":68,"y":801,"width":208,"height":9}},{"id":"fcfe36a9-a6f7-4836-b8b1-961019730f02","block_type":"box","text":"The Code subjects interest received on cer tain otherwise tax-exempt securities to a federal alternative minimum","page_number":182,"box":{"x":101,"y":823,"width":801,"height":11}},{"id":"3e555eec-7dca-4d95-9fbc-faa78fc3008e","block_type":"box","text":"tax. The alternative minimum tax applies to interest received on cer tain “PABs” issued after August 7, 1986. PABs","page_number":182,"box":{"x":68,"y":838,"width":818,"height":12}},{"id":"e11c96e9-c6c0-4dbf-b750-ea17801a0260","block_type":"box","text":"are bonds that, although tax-exempt, are used for purposes other than those generally per formed by governmental","page_number":182,"box":{"x":69,"y":853,"width":816,"height":12}},{"id":"05ccd11a-6a2c-4bab-98c0-4be1ce6202c5","block_type":"box","text":"units and that benefit non-governmental entities (","page_number":182,"box":{"x":69,"y":869,"width":351,"height":11}},{"id":"1c66303a-e85b-4c13-b794-5246c1ac2e59","block_type":"box","text":"e.g.","page_number":182,"box":{"x":422,"y":870,"width":24,"height":10}},{"id":"433931ec-4b65-4ca6-8ede-795a85410cb1","block_type":"box","text":", bonds used for industrial development or housing purposes).","page_number":182,"box":{"x":449,"y":869,"width":441,"height":11}},{"id":"2936dfa8-2f21-4118-90f8-52d68750991f","block_type":"box","text":"Income received on such bonds is classified as an item of “tax preference,” which could subject cer tain investors in","page_number":182,"box":{"x":70,"y":884,"width":827,"height":11}},{"id":"539bd293-c579-456e-a9fa-3d7132d32214","block_type":"box","text":"such bonds, including shareholders of a Fund, to a federal alternative minimum tax. A Fund will purchase such","page_number":182,"box":{"x":69,"y":899,"width":786,"height":11}},{"id":"0a1a18c6-dd22-46ce-b220-55ad358cd430","block_type":"box","text":"II-135","page_number":182,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"2e8a30f1-7b45-40a9-83d7-7fab8d0b673d","block_type":"box","text":"NM1026U-6033063-182/246","page_number":182,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"a3bc5cc3-73cf-4791-9b89-336725be135b","block_type":"box","text":"“PABs” and will repor t to shareholders after the close of the calendar year the por tion of the Fund’s dividends","page_number":183,"box":{"x":70,"y":45,"width":782,"height":11}},{"id":"975271b0-2012-465b-863a-0ae7c564dcde","block_type":"box","text":"declared during the year that constitute an item of tax preference for alternative minimum tax purposes.","page_number":183,"box":{"x":69,"y":60,"width":740,"height":11}},{"id":"fdb2ff93-800b-4877-881f-85138d7b1d98","block_type":"box","text":"Each Municipal Fund may engage in interest rate swap transactions. The U.S. federal income tax rules governing","page_number":183,"box":{"x":102,"y":82,"width":802,"height":12}},{"id":"e3921427-8548-46d3-b068-e804d8ed6932","block_type":"box","text":"the taxation of interest rate swaps are not entirely clear and may require a Fund to treat payments received under","page_number":183,"box":{"x":68,"y":98,"width":812,"height":11}},{"id":"35d2cfb7-4943-463f-818c-85c8e12091bf","block_type":"box","text":"such arrangements as ordinary income and to amor tize payments made under cer tain circumstances. Because","page_number":183,"box":{"x":69,"y":113,"width":794,"height":11}},{"id":"dbc7b6ba-940a-4b45-93b1-257388f4d530","block_type":"box","text":"payments received by a Fund in connection with swap transactions will be taxable rather than tax-exempt and","page_number":183,"box":{"x":70,"y":128,"width":776,"height":11}},{"id":"fa417c5d-4e0a-47f0-b4ac-f4a86c0b96f6","block_type":"box","text":"because swap payments made by a Fund will offset both taxable and tax-exempt gross income propor tionately, they","page_number":183,"box":{"x":69,"y":143,"width":826,"height":11}},{"id":"6f0e4493-52f6-4164-aa8f-a7b388ca58d5","block_type":"box","text":"may result in increased taxable distributions to shareholders.","page_number":183,"box":{"x":69,"y":158,"width":436,"height":11}},{"id":"9d1f5956-efbf-4647-b3be-6377cf5f9542","block_type":"box","text":"Please see Par t I of your Fund’s SAI for cer tain state tax information relevant to an investment in BlackRock","page_number":183,"box":{"x":102,"y":181,"width":771,"height":11}},{"id":"c91b0aad-dfe8-416b-837d-b766834942bf","block_type":"box","text":"California Municipal Oppor tunities Fund, BlackRock New Jersey Municipal Bond Fund, BlackRock New York Municipal","page_number":183,"box":{"x":69,"y":196,"width":828,"height":11}},{"id":"438c3b46-6d3d-4386-85e4-0190ac532997","block_type":"box","text":"Oppor tunities Fund and BlackRock Pennsylvania Municipal Bond Fund, as well as information on economic conditions","page_number":183,"box":{"x":69,"y":211,"width":836,"height":11}},{"id":"6724d29b-82c3-43f9-9e84-841b87a3e182","block_type":"box","text":"within each applicable state.","page_number":183,"box":{"x":68,"y":226,"width":203,"height":11}},{"id":"559414e4-7fbb-4343-9acb-e257bb52a0ce","block_type":"box","text":"In the case of a Feeder Fund, such Fund is entitled to look to the underlying assets of the Master Por tfolio in","page_number":183,"box":{"x":102,"y":249,"width":774,"height":11}},{"id":"4d3f4e25-5525-4241-b0b2-505d0b76d73c","block_type":"box","text":"which it has invested for purposes of satisfying various qualification requirements of the Code applicable to regulated","page_number":183,"box":{"x":68,"y":264,"width":837,"height":11}},{"id":"4a559768-5ca4-4232-a001-9ae98c40254c","block_type":"box","text":"investment companies. Each Master Por tfolio is classified either as a par tnership or a separate disregarded entity","page_number":183,"box":{"x":70,"y":279,"width":816,"height":11}},{"id":"cde3f4e9-583f-4360-869a-8571f9fd8267","block_type":"box","text":"(depending on the par ticular Master Por tfolio) for U.S. federal income tax purposes. If applicable tax provisions were","page_number":183,"box":{"x":69,"y":294,"width":830,"height":11}},{"id":"7ce27f51-6c6d-476f-aa32-aa34893f297f","block_type":"box","text":"to change the classification of a Master Por tfolio, then the Board of Directors of a Feeder Fund would determine, in","page_number":183,"box":{"x":68,"y":309,"width":822,"height":11}},{"id":"2f99ca87-726e-4eba-ad23-8062584e5d3b","block_type":"box","text":"its discretion, the appropriate course of action for the Feeder Fund. One possible course of action would be to","page_number":183,"box":{"x":70,"y":324,"width":783,"height":11}},{"id":"3e8594bf-d2df-4830-953e-e57939f7393e","block_type":"box","text":"withdraw the Feeder Fund’s investments from the Master Por tfolio and to retain an investment manager to manage","page_number":183,"box":{"x":68,"y":339,"width":822,"height":12}},{"id":"0ae8619f-6ae6-4f14-86b8-5dcfc14fba4d","block_type":"box","text":"the Feeder Fund’s assets in accordance with the investment policies applicable to the Feeder Fund.","page_number":183,"box":{"x":68,"y":355,"width":710,"height":11}},{"id":"64db7ca5-7c9a-4f5c-900b-6148395d64ec","block_type":"box","text":"Ordinary income and capital gain dividends may also be subject to state and local taxes. Cer tain states exempt","page_number":183,"box":{"x":102,"y":377,"width":796,"height":12}},{"id":"17d69a17-77ba-4cfc-a290-27d5c53cec3e","block_type":"box","text":"from state income taxation dividends paid by regulated investment companies that are derived from interest on U.S.","page_number":183,"box":{"x":68,"y":392,"width":828,"height":12}},{"id":"c4439b0d-f256-4466-9dc8-44ec892ae7d6","block_type":"box","text":"government obligations. State law varies as to whether dividend income attributable to U.S. government obligations is","page_number":183,"box":{"x":68,"y":408,"width":841,"height":11}},{"id":"041c1d39-54b6-4870-a4e4-fa7e6bce5ad7","block_type":"box","text":"exempt from state income tax.","page_number":183,"box":{"x":69,"y":423,"width":216,"height":11}},{"id":"58777f35-14a4-4909-936c-da703cbcecb9","block_type":"box","text":"Shareholders of each Fund are urged to consult their tax advisers regarding specific questions as to federal,","page_number":183,"box":{"x":102,"y":445,"width":771,"height":12}},{"id":"5d59204f-74ff-42b7-b86b-d81ab0ae4883","block_type":"box","text":"foreign, state or local taxes with respect to their Fund. Foreign investors should consider applicable foreign taxes in","page_number":183,"box":{"x":68,"y":460,"width":823,"height":12}},{"id":"427a2f5a-94dc-4c7c-9cd3-2664a4c1330a","block_type":"box","text":"their evaluation of an investment in a Fund.","page_number":183,"box":{"x":68,"y":475,"width":309,"height":9}},{"id":"b640fef5-e904-4d1a-a582-1cfa5f4d93b8","block_type":"box","text":"The foregoing general discussion of U.S. federal income tax consequences is based on the Code and the","page_number":183,"box":{"x":101,"y":498,"width":749,"height":11}},{"id":"b9768ee9-0d34-4483-b905-78060fc8eac8","block_type":"box","text":"regulations issued thereunder as in effect on the date of this SAI. Future legislative or administrative changes or","page_number":183,"box":{"x":69,"y":513,"width":803,"height":12}},{"id":"d739861b-d785-4562-b362-1609524ad3d6","block_type":"box","text":"cour t decisions may significantly change the conclusions expressed in this discussion, and any such changes or","page_number":183,"box":{"x":69,"y":528,"width":801,"height":12}},{"id":"8e8bea78-5a95-4d8a-8921-a1c5b811810d","block_type":"box","text":"decisions may have a retroactive effect.","page_number":183,"box":{"x":69,"y":543,"width":283,"height":12}},{"id":"ac97175b-7dcf-4b9f-a7be-d179d3cad24c","block_type":"box","text":"PERFORMANCE DATA","page_number":183,"box":{"x":403,"y":573,"width":173,"height":10}},{"id":"f75018ad-c94d-4a28-adfa-54b1e995b4e0","block_type":"box","text":"From time to time a Fund may include its average annual total return and other total return data, and, if","page_number":183,"box":{"x":102,"y":596,"width":738,"height":11}},{"id":"cd099464-95da-47b1-aef8-a1b708236802","block_type":"box","text":"applicable, yield and tax-equivalent yield in adver tisements or information furnished to present or prospective","page_number":183,"box":{"x":69,"y":611,"width":779,"height":11}},{"id":"ea66ca3c-e302-438a-89d5-44d75c44d0ab","block_type":"box","text":"shareholders. Total return, yield and tax-equivalent yield each is based on a Fund’s historical per formance and is not","page_number":183,"box":{"x":69,"y":626,"width":833,"height":11}},{"id":"3cea66ca-22e3-462f-8752-71b1b995ee1d","block_type":"box","text":"intended to indicate future per formance. Average annual total return is determined separately for each class of","page_number":183,"box":{"x":70,"y":641,"width":792,"height":11}},{"id":"e9309f4e-4166-455c-9f4b-025e327f3bd6","block_type":"box","text":"shares in accordance with a formula specified by the Commission.","page_number":183,"box":{"x":69,"y":656,"width":473,"height":11}},{"id":"950e6a45-697c-48cb-9917-61234838dcad","block_type":"box","text":"Quotations of average annual total return, before tax, for the specified periods are computed by finding the","page_number":183,"box":{"x":102,"y":679,"width":761,"height":11}},{"id":"c47d1609-6f7e-43ca-b63f-319aa71e7e2c","block_type":"box","text":"average annual compounded rates of return (based on net investment income and any realized and unrealized capital","page_number":183,"box":{"x":69,"y":694,"width":836,"height":11}},{"id":"62ad7be5-8dd0-40dd-8576-49f3683779f0","block_type":"box","text":"gains or losses on por tfolio investments over such periods) that would equate the initial amount invested to the","page_number":183,"box":{"x":68,"y":709,"width":798,"height":11}},{"id":"652ed8f2-56c2-4c63-aef4-25befd4e2b78","block_type":"box","text":"redeemable value of such investment at the end of each period. Average annual total return before taxes is","page_number":183,"box":{"x":69,"y":724,"width":765,"height":12}},{"id":"313d71a8-316b-4405-b69b-911e4b15c41b","block_type":"box","text":"computed assuming all dividends are reinvested and taking into account all applicable recurring and nonrecurring","page_number":183,"box":{"x":69,"y":740,"width":808,"height":11}},{"id":"ea2245a8-d48d-4efe-b0a9-898fc8e209ca","block_type":"box","text":"expenses, including the maximum sales charge, in the case of front-end load shares, and the CDSC that would be","page_number":183,"box":{"x":69,"y":755,"width":813,"height":11}},{"id":"9c183509-3ecb-47a0-9d28-2114de57bd01","block_type":"box","text":"applicable to a complete redemption of the investment at the end of the specified period in the case of CDSC shares,","page_number":183,"box":{"x":69,"y":770,"width":839,"height":11}},{"id":"f339284a-6b33-47fe-a25b-463c6d46c41b","block_type":"box","text":"but does not take into account taxes payable on dividends or on redemption.","page_number":183,"box":{"x":69,"y":785,"width":546,"height":11}},{"id":"c251c1b4-d6ac-4396-b4fe-cdf621935e18","block_type":"box","text":"Quotations of average annual total return, after taxes, on dividends for the specified periods are computed by","page_number":183,"box":{"x":102,"y":807,"width":781,"height":12}},{"id":"d39ccc9a-568b-4a68-82ff-a6fc523b6b56","block_type":"box","text":"finding the average annual compounded rates of return that would equate the initial amount invested to the ending","page_number":183,"box":{"x":68,"y":823,"width":819,"height":11}},{"id":"8b53a6cf-ed03-4850-a584-6db51f9886dd","block_type":"box","text":"value of such investment at the end of each period assuming payment of taxes on dividends received during such","page_number":183,"box":{"x":68,"y":838,"width":810,"height":11}},{"id":"f6089fec-8c97-4c1c-aade-c48cf324cd51","block_type":"box","text":"period. Average annual total return after taxes on dividends is computed assuming all dividends, less the taxes due","page_number":183,"box":{"x":70,"y":853,"width":823,"height":11}},{"id":"7a9e4adc-f5e4-4d70-8ef5-5da73505072b","block_type":"box","text":"on such dividends, are reinvested and taking into account all applicable recurring and nonrecurring expenses,","page_number":183,"box":{"x":69,"y":868,"width":780,"height":11}},{"id":"b565fb0a-b8e8-4c2e-a6db-42d7638206cf","block_type":"box","text":"including the maximum sales charge, in the case of front-end load shares and the CDSC that would be applicable to","page_number":183,"box":{"x":70,"y":883,"width":825,"height":11}},{"id":"cf44ea1c-e9db-4228-9bc6-b5ab597f0685","block_type":"box","text":"a complete redemption of the investment at the end of the specified period in the case of CDSC shares. The taxes","page_number":183,"box":{"x":69,"y":898,"width":817,"height":11}},{"id":"59a7b2b6-8b52-4da6-ad9d-496ab6487e18","block_type":"box","text":"II-136","page_number":183,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"b1aa88a1-8c36-4490-8a07-4a201808bad3","block_type":"box","text":"NM1026U-6033063-183/246","page_number":183,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"bc72d2c9-037d-49f2-a6db-8fd354ba0b73","block_type":"box","text":"due on dividends are calculated by applying to each dividend the highest applicable marginal U.S. federal individual","page_number":184,"box":{"x":69,"y":45,"width":820,"height":11}},{"id":"65685c8d-4357-43a4-b013-4113ddaf7ea3","block_type":"box","text":"income tax rates in effect on the reinvestment date for that dividend. The rates used correspond to the tax character","page_number":184,"box":{"x":70,"y":60,"width":833,"height":11}},{"id":"5f987494-76a0-44bd-a220-b29857ca1351","block_type":"box","text":"(including eligibility for the maximum 20% tax rate applicable to qualified dividend income) of each dividend. The","page_number":184,"box":{"x":69,"y":75,"width":797,"height":11}},{"id":"4b7067e7-1bc4-49dd-b4d2-2c59f3717c89","block_type":"box","text":"taxable amount and tax character of each dividend are specified by each Fund on the dividend declaration date, but","page_number":184,"box":{"x":68,"y":90,"width":824,"height":11}},{"id":"c35c0287-77a4-45e5-ac6e-8e7cc791d173","block_type":"box","text":"may be adjusted to reflect subsequent recharacterizations of distributions. The applicable tax rates may vary over the","page_number":184,"box":{"x":69,"y":105,"width":837,"height":11}},{"id":"edd208e5-43c6-4555-8b40-a389b0159cfb","block_type":"box","text":"measurement period. The effects of state and local taxes are not reflected. Applicable tax credits, such as foreign","page_number":184,"box":{"x":69,"y":120,"width":814,"height":12}},{"id":"84df84ad-fbe2-4372-9fb2-b91cea4be45e","block_type":"box","text":"credits, are taken into account according to U.S. federal tax law. The ending value is determined assuming complete","page_number":184,"box":{"x":69,"y":135,"width":830,"height":12}},{"id":"b7a6d6ef-c83c-495d-9240-461dee5fe4fb","block_type":"box","text":"redemption at the end of the applicable periods with no tax consequences associated with such redemption.","page_number":184,"box":{"x":69,"y":150,"width":774,"height":11}},{"id":"80d92dca-f5a2-4a67-a9ee-1d2bd4d2618f","block_type":"box","text":"Quotations of average annual total return, after taxes, on both dividends and redemption for the specified","page_number":184,"box":{"x":102,"y":173,"width":752,"height":11}},{"id":"f7732de3-e6ac-44d9-9608-9129c8072164","block_type":"box","text":"periods are computed by finding the average annual compounded rates of return that would equate the initial amount","page_number":184,"box":{"x":70,"y":188,"width":835,"height":12}},{"id":"010ec0ba-daab-4533-b24f-a3e837683183","block_type":"box","text":"invested to the ending value of such investment at the end of each period assuming payment of taxes on dividends","page_number":184,"box":{"x":70,"y":203,"width":820,"height":12}},{"id":"53a31369-cbff-45de-9b36-e0dc3b5c998a","block_type":"box","text":"received during such period as well as on complete redemption. Average annual total return after taxes on","page_number":184,"box":{"x":69,"y":218,"width":756,"height":12}},{"id":"af98e6ae-d01d-4fdc-9579-1bd870f8fb73","block_type":"box","text":"distributions and redemption is computed assuming all dividends, less the taxes due on such dividends, are","page_number":184,"box":{"x":69,"y":234,"width":772,"height":11}},{"id":"ffa3812f-5065-4a51-a26c-4cd369bef11f","block_type":"box","text":"reinvested and taking into account all applicable recurring and nonrecurring expenses, including the maximum sales","page_number":184,"box":{"x":69,"y":249,"width":827,"height":11}},{"id":"c737e103-0707-4896-afc9-4b5d83cc4434","block_type":"box","text":"charge in the case of front-end load shares and the CDSC that would be applicable to a complete redemption of the","page_number":184,"box":{"x":69,"y":264,"width":825,"height":11}},{"id":"bb427987-a306-47bf-98d3-0f8972710b80","block_type":"box","text":"investment at the end of the specified period in the case of CDSC shares and assuming, for all classes of shares,","page_number":184,"box":{"x":70,"y":279,"width":812,"height":11}},{"id":"7dc6657c-af74-4b7a-9804-8f394fa775d2","block_type":"box","text":"complete redemption and payment of taxes due on such redemption. The ending value is determined assuming","page_number":184,"box":{"x":69,"y":294,"width":795,"height":11}},{"id":"9d68b105-97bc-4827-8dba-3b937f021035","block_type":"box","text":"complete redemption at the end of the applicable periods, subtracting capital gains taxes resulting from the","page_number":184,"box":{"x":69,"y":309,"width":768,"height":11}},{"id":"7f85c7b2-6ea7-41c9-9cd6-de4e4a0cfd9c","block_type":"box","text":"redemption and adding the presumed tax benefit from capital losses resulting from redemption. The taxes due on","page_number":184,"box":{"x":69,"y":324,"width":810,"height":12}},{"id":"280ebb21-c48c-4caf-ba4a-5768e4952b94","block_type":"box","text":"dividends and on the deemed redemption are calculated by applying the highest applicable marginal U.S. federal","page_number":184,"box":{"x":69,"y":339,"width":802,"height":12}},{"id":"78012752-a7d1-44d7-b333-862a2eb042a3","block_type":"box","text":"individual income tax rates in effect on the reinvestment and/or the redemption date. The rates used correspond to","page_number":184,"box":{"x":70,"y":355,"width":825,"height":11}},{"id":"a00022dd-96e0-40f3-84ac-749bb4c79a7d","block_type":"box","text":"the tax character (including eligibility for the maximum 20% tax rate applicable to qualified dividend income) of each","page_number":184,"box":{"x":68,"y":370,"width":823,"height":11}},{"id":"30f3e3a8-3585-4d0f-9ed7-d3d7b402aeee","block_type":"box","text":"component of each dividend and/or the redemption payment. The applicable tax rates may vary over the","page_number":184,"box":{"x":69,"y":385,"width":743,"height":11}},{"id":"598ef0c3-e025-43ab-81f8-ea72cac14c3f","block_type":"box","text":"measurement period. The effects of state and local taxes are not reflected. Applicable tax credits, such as foreign","page_number":184,"box":{"x":69,"y":400,"width":814,"height":11}},{"id":"626932c7-4d07-4236-a59f-8e3eaa90434e","block_type":"box","text":"tax credits, are taken into account according to federal law.","page_number":184,"box":{"x":68,"y":415,"width":422,"height":11}},{"id":"4751e464-a49f-4ba9-8ec1-00f82cba63d6","block_type":"box","text":"A Fund also may quote annual, average annual and annualized total return and aggregate total return","page_number":184,"box":{"x":101,"y":438,"width":720,"height":11}},{"id":"fa16cf7b-a0f8-412a-ae8b-802da43982fd","block_type":"box","text":"per formance data, both as a percentage and as a dollar amount based on a hypothetical investment of $1,000 or","page_number":184,"box":{"x":70,"y":452,"width":813,"height":12}},{"id":"9ecb7bed-6778-4011-93b4-3cb06bb098e9","block_type":"box","text":"some other amount, for various periods other than those noted in Par t I of each Fund’s SAI. Such data will be","page_number":184,"box":{"x":69,"y":468,"width":781,"height":11}},{"id":"46ff4fb3-4ee6-4179-8669-73eda35db20b","block_type":"box","text":"computed as described above, except that (1) as required by the periods of the quotations, actual annual, annualized","page_number":184,"box":{"x":69,"y":483,"width":837,"height":11}},{"id":"bdd16683-6ad2-4cbf-a1f7-e68ccbe1c537","block_type":"box","text":"or aggregate data, rather than average annual data, may be quoted and (2) the maximum applicable sales charges","page_number":184,"box":{"x":69,"y":498,"width":817,"height":11}},{"id":"67523503-54d1-4d07-8f82-8ee28ef0f5a5","block_type":"box","text":"will not be included with respect to annual or annualized rates of return calculations. Aside from the impact on the","page_number":184,"box":{"x":68,"y":513,"width":815,"height":11}},{"id":"15064108-1738-4148-aa49-b41fe7fb3525","block_type":"box","text":"per formance data calculations of including or excluding the maximum applicable sales charges, actual annual or","page_number":184,"box":{"x":70,"y":528,"width":801,"height":12}},{"id":"7bc8f168-b2e8-4d00-bb1f-89a120583b3d","block_type":"box","text":"annualized total return data generally will be lower than average annual total return data since the average rates of","page_number":184,"box":{"x":69,"y":543,"width":819,"height":12}},{"id":"5c082c88-7c1f-44bc-8584-7074fb520e5e","block_type":"box","text":"return reflect compounding of return; aggregate total return data generally will be higher than average annual total","page_number":184,"box":{"x":69,"y":559,"width":811,"height":11}},{"id":"a5c4b7de-b5e7-48ae-b5f2-30321677facf","block_type":"box","text":"return data since the aggregate rates of return reflect compounding over a longer period of time.","page_number":184,"box":{"x":69,"y":574,"width":686,"height":11}},{"id":"87da13ed-a95b-4d4e-81d3-875c4ecebadb","block_type":"box","text":"Yield quotations will be computed based on a 30-day period by dividing (a) the net income based on the yield of","page_number":184,"box":{"x":101,"y":596,"width":796,"height":12}},{"id":"51b27f91-cd9b-4116-a267-bd1bd638f013","block_type":"box","text":"each security earned during the period by (b) the average daily number of shares outstanding during the period that","page_number":184,"box":{"x":69,"y":612,"width":821,"height":11}},{"id":"9622aae1-e500-4ad4-86c4-03ae2c6ba0b8","block_type":"box","text":"were entitled to receive dividends multiplied by the maximum offering price per share on the last day of the period.","page_number":184,"box":{"x":68,"y":627,"width":817,"height":11}},{"id":"62653863-92d7-4d27-92a7-994a8894aea8","block_type":"box","text":"Tax equivalent yield quotations will be computed by dividing (a) the par t of a Fund’s yield that is tax-exempt by (b) one","page_number":184,"box":{"x":68,"y":642,"width":837,"height":11}},{"id":"8553003d-7d07-4c45-8f32-e7d1ba36bd66","block_type":"box","text":"minus a stated tax rate and adding the result to that par t, if any, of the Fund’s yield that is not tax-exempt.","page_number":184,"box":{"x":69,"y":657,"width":759,"height":11}},{"id":"e013e10f-77f7-417f-9bf0-73f5cf3b2847","block_type":"box","text":"A Fund’s total return will vary depending on market conditions, the securities comprising a Fund’s por tfolio, a","page_number":184,"box":{"x":101,"y":680,"width":779,"height":11}},{"id":"798bdd14-902e-4b83-944b-a4e472430f92","block_type":"box","text":"Fund’s operating expenses and the amount of realized and unrealized net capital gains or losses during the period.","page_number":184,"box":{"x":70,"y":695,"width":819,"height":11}},{"id":"8f16bb1e-e20c-4f56-8ba9-5f2c3949d915","block_type":"box","text":"The value of an investment in a Fund will fluctuate and an investor’s shares, when redeemed, may be wor th more or","page_number":184,"box":{"x":68,"y":710,"width":830,"height":11}},{"id":"691e8927-a325-4b89-bb61-77e248ee177f","block_type":"box","text":"less than their original cost.","page_number":184,"box":{"x":70,"y":725,"width":196,"height":11}},{"id":"a4ceca63-0a2a-47f5-ae84-2394b976734f","block_type":"box","text":"In order to reflect the reduced sales charges in the case of front-end load shares or the waiver of the CDSC in","page_number":184,"box":{"x":102,"y":748,"width":782,"height":11}},{"id":"74fb310e-9b15-4438-a24e-b9afece863a3","block_type":"box","text":"the case of CDSC shares applicable to cer tain investors, as described under “Purchase of Shares” and “Redemption","page_number":184,"box":{"x":68,"y":763,"width":836,"height":11}},{"id":"7bd9ef5b-ff0c-4184-9edb-6de8f2319064","block_type":"box","text":"of Shares,” respectively, the total return data quoted by a Fund in adver tisements directed to such investors may","page_number":184,"box":{"x":69,"y":778,"width":807,"height":11}},{"id":"75cd8156-e7ea-42bf-8e1d-d95a68ab202a","block_type":"box","text":"take into account the reduced, and not the maximum, sales charge or may take into account the CDSC waiver and,","page_number":184,"box":{"x":68,"y":793,"width":820,"height":11}},{"id":"05b4f6ba-98e6-49a9-897f-0b6d7b41dc34","block_type":"box","text":"therefore, may reflect greater total return since, due to the reduced sales charges or the waiver of sales charges, a","page_number":184,"box":{"x":68,"y":808,"width":824,"height":11}},{"id":"2c7c4534-39f7-429f-8a55-77a87932d142","block_type":"box","text":"lower amount of expenses is deducted.","page_number":184,"box":{"x":70,"y":823,"width":278,"height":11}},{"id":"679f795b-7de7-4b4b-9d08-830e9fbd3cb4","block_type":"box","text":"On occasion, a Fund may compare its per formance to, among other things, the Fund’s benchmark index","page_number":184,"box":{"x":102,"y":846,"width":741,"height":11}},{"id":"2f5f7b30-8766-4246-aa90-b8c6e1b4a40e","block_type":"box","text":"indicated in the Prospectus, the Value Line Composite Index, the Dow Jones Industrial Average, or to other published","page_number":184,"box":{"x":70,"y":861,"width":830,"height":11}},{"id":"8c9ce7cc-93d0-49e6-8115-e991df48d907","block_type":"box","text":"indices, or to per formance data published by Lipper Inc., Morningstar, Inc. (“Morningstar”),","page_number":184,"box":{"x":70,"y":876,"width":646,"height":11}},{"id":"0546473f-3b00-46a7-ade0-5937c4f621a6","block_type":"box","text":"Money Magazine, U.S.","page_number":184,"box":{"x":724,"y":876,"width":156,"height":11}},{"id":"707348dc-bc60-4d77-b9c3-305ca520793c","block_type":"box","text":"News & World Repor t, BusinessWeek, Forbes Magazine, For tune Magazine","page_number":184,"box":{"x":70,"y":891,"width":533,"height":12}},{"id":"5586a2d5-434a-4ab2-89a2-e1d61421bcfb","block_type":"box","text":"or other industry publications. When","page_number":184,"box":{"x":608,"y":891,"width":257,"height":11}},{"id":"3ed3b2cb-31e7-4a1c-ab3a-809ff98259c6","block_type":"box","text":"comparing its per formance to a market index, a Fund may refer to various statistical measures derived from the","page_number":184,"box":{"x":69,"y":906,"width":797,"height":12}},{"id":"deb22c23-ccf2-4d70-91d9-af1697794f4e","block_type":"box","text":"II-137","page_number":184,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"98c72692-2517-4854-9a64-05ddd977aea7","block_type":"box","text":"NM1026U-6033063-184/246","page_number":184,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"0d82d72e-a880-4252-b1e5-509295348f14","block_type":"box","text":"historical per formance of a Fund and the index, such as standard deviation and beta. As with other per formance","page_number":185,"box":{"x":69,"y":45,"width":803,"height":11}},{"id":"f79a1cb2-5dbb-42ca-9d8a-5f9e9d821a54","block_type":"box","text":"data, per formance comparisons should not be considered indicative of a Fund’s relative per formance for any future","page_number":185,"box":{"x":69,"y":60,"width":824,"height":11}},{"id":"a6d51362-7be7-4fa4-bb3c-4046e1f09601","block_type":"box","text":"period. In addition, from time to time a Fund may include the Fund’s Morningstar risk-adjusted per formance ratings","page_number":185,"box":{"x":70,"y":75,"width":818,"height":11}},{"id":"596f526e-d0b4-4b4d-a26f-a58b9de5d90d","block_type":"box","text":"assigned by Morningstar in adver tising or supplemental sales literature. From time to time a Fund may quote in","page_number":185,"box":{"x":69,"y":90,"width":793,"height":11}},{"id":"8c88d2dd-8115-4803-a24b-767edaa29718","block_type":"box","text":"adver tisements or other materials other applicable measures of Fund per formance and may also make reference to","page_number":185,"box":{"x":69,"y":105,"width":826,"height":11}},{"id":"27687990-348b-4cb0-a486-a94cff143bf3","block_type":"box","text":"awards that may be given to the Manager. Cer tain Funds may also compare their per formance to composite indices","page_number":185,"box":{"x":69,"y":120,"width":825,"height":12}},{"id":"2efcb5a7-2814-4597-a3fd-2bc701eff3c4","block_type":"box","text":"developed by Fund management.","page_number":185,"box":{"x":69,"y":136,"width":233,"height":11}},{"id":"88006e66-eb96-4772-ac3e-2fde358ef530","block_type":"box","text":"A Fund may provide information designed to help investors understand how the Fund is seeking to achieve its","page_number":185,"box":{"x":101,"y":158,"width":780,"height":11}},{"id":"f625ae9a-dfd0-407f-973b-6cb971354266","block_type":"box","text":"investment objectives. This may include information about past, current or possible economic, market, political or","page_number":185,"box":{"x":70,"y":173,"width":810,"height":11}},{"id":"9ea02a6f-5939-45be-9ded-5e9f48e39ad1","block_type":"box","text":"other conditions, descriptive information or general principles of investing such as asset allocation, diversification","page_number":185,"box":{"x":69,"y":188,"width":810,"height":12}},{"id":"0a695f1a-028a-4624-8ecc-481f6118b88d","block_type":"box","text":"and risk tolerance, discussion of a Fund’s por tfolio composition, investment philosophy, strategy or investment","page_number":185,"box":{"x":69,"y":203,"width":792,"height":12}},{"id":"1b2d806d-a98c-4b80-a524-38c0ee0b14bd","block_type":"box","text":"techniques, comparisons of the Fund’s per formance or por tfolio composition to that of other funds or types of","page_number":185,"box":{"x":68,"y":218,"width":788,"height":12}},{"id":"ab16ce05-54f5-4e6e-a81f-425b94dd5112","block_type":"box","text":"investments, indices relevant to the comparison being made, or to a hypothetical or model por tfolio. A Fund may also","page_number":185,"box":{"x":70,"y":234,"width":835,"height":11}},{"id":"78cd6bb4-db93-45e0-893f-daddd9dd312d","block_type":"box","text":"quote various measures of volatility and benchmark correlation in adver tising and other materials, and may compare","page_number":185,"box":{"x":69,"y":249,"width":830,"height":11}},{"id":"adf24507-108e-40f8-bae6-0567cd27a045","block_type":"box","text":"these measures to those of other funds or types of investments.","page_number":185,"box":{"x":68,"y":264,"width":461,"height":11}},{"id":"3dec008d-931d-44ca-adf3-09e96847952c","block_type":"box","text":"PROXY VOTING POLICIES AND PROCEDURES","page_number":185,"box":{"x":308,"y":293,"width":362,"height":10}},{"id":"42078b21-0c09-4893-a58f-bf2aca2a87de","block_type":"box","text":"The Board of Directors of the Funds has delegated the voting of proxies for the Funds’ securities to the Manager","page_number":185,"box":{"x":101,"y":316,"width":802,"height":11}},{"id":"33d78f28-2ce3-4614-a642-65fa761c124e","block_type":"box","text":"pursuant to (i) the Open-End Active and Fixed Income Index Fund Proxy Voting Policy (the “Active Fund Proxy Voting","page_number":185,"box":{"x":70,"y":331,"width":809,"height":12}},{"id":"b311408c-da2f-4e70-bb87-5e82cb3d0aa6","block_type":"box","text":"Policy”), with respect to cer tain Funds, and (ii) the Index Equity Fund Proxy Voting Policy, with respect to cer tain other","page_number":185,"box":{"x":69,"y":347,"width":833,"height":11}},{"id":"6e74cdc3-4aab-43f2-91f0-eb3f3bf103f5","block_type":"box","text":"Funds, as applicable. Please refer to Par t I of this SAI, which discloses the policy applicable to each Fund.","page_number":185,"box":{"x":70,"y":361,"width":755,"height":12}},{"id":"ca5bd222-7611-4468-9209-f702609e1c20","block_type":"box","text":"With respect to Funds covered by the Active Fund Proxy Voting Policy, the Manager has adopted the BlackRock","page_number":185,"box":{"x":101,"y":384,"width":785,"height":11}},{"id":"655e7c25-bed5-4025-a86f-32e87f643054","block_type":"box","text":"Active Investment Stewardship—Global Engagement and Voting Guidelines (the “BAIS Guidelines”). Cer tain of such","page_number":185,"box":{"x":68,"y":399,"width":822,"height":12}},{"id":"bd84fd69-0d3f-412c-93a7-113186eb9aee","block_type":"box","text":"Funds, as listed within the Active Fund Proxy Voting Policy and as disclosed in Par t I of this SAI, follow supplemental","page_number":185,"box":{"x":70,"y":414,"width":824,"height":12}},{"id":"7c87c230-d618-48e3-b617-5cec54567058","block_type":"box","text":"guidelines within the BAIS Guidelines that are applicable to cer tain climate and decarbonization issues (the “BAIS","page_number":185,"box":{"x":68,"y":430,"width":812,"height":11}},{"id":"d9458dbe-3872-4ded-843f-7c032e93dd24","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines”).","page_number":185,"box":{"x":69,"y":445,"width":392,"height":11}},{"id":"fd68d2aa-79e9-4cb1-81fa-26d2a9fddc76","block_type":"box","text":"With respect to Funds covered by the Index Equity Fund Proxy Voting Policy, the Manager has adopted the","page_number":185,"box":{"x":101,"y":468,"width":749,"height":11}},{"id":"ba17d64a-982c-4469-b04c-1f7432483a0a","block_type":"box","text":"BlackRock Investment Stewardship (“BIS”) Global Benchmark Policy, comprised of the Global Principles for","page_number":185,"box":{"x":70,"y":482,"width":759,"height":12}},{"id":"2ac8d777-b86e-41f2-9c52-941aee1aba69","block_type":"box","text":"Benchmark Policies, regional voting guidelines, and engagement priorities, which are each available upon request. In","page_number":185,"box":{"x":70,"y":498,"width":830,"height":11}},{"id":"6330d0bc-0965-4c8d-9522-f4731f0c3df3","block_type":"box","text":"addition, cer tain of such Funds, as listed within the Index Equity Fund Proxy Voting Policy and as disclosed in Par t I of","page_number":185,"box":{"x":69,"y":513,"width":838,"height":11}},{"id":"e26ee207-22a4-433c-917e-bd34f444e7cc","block_type":"box","text":"this SAI, follow supplemental guidelines that are applicable to cer tain climate and decarbonization issues (the “BIS","page_number":185,"box":{"x":68,"y":528,"width":822,"height":11}},{"id":"460401a3-ac86-4329-9be6-df14b1195e02","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines”).","page_number":185,"box":{"x":69,"y":543,"width":392,"height":11}},{"id":"0075663c-b0eb-4fb6-a1c4-c195d5242c46","block_type":"box","text":"If a Fund invests in an underlying fund managed by BlackRock, the Fund will use its proxy voting policy when","page_number":185,"box":{"x":102,"y":566,"width":767,"height":11}},{"id":"f8b8ab12-cfb4-4eab-b314-2109f78ac7c3","block_type":"box","text":"voting on proxies for the underlying fund while the underlying fund will use its proxy voting policy when voting proxies","page_number":185,"box":{"x":68,"y":581,"width":827,"height":11}},{"id":"0fc09879-0a13-4f40-9236-81c87122be89","block_type":"box","text":"on investments the underlying fund holds. Therefore, the Fund may use the Active Fund Proxy Voting Policy while an","page_number":185,"box":{"x":69,"y":596,"width":819,"height":11}},{"id":"07a877f7-bc14-4f17-91a0-0c6cf7507758","block_type":"box","text":"underlying fund may use the Index Equity Fund Proxy Voting Policy, and the opposite is also true.","page_number":185,"box":{"x":69,"y":611,"width":684,"height":11}},{"id":"60a498ea-7f28-4b34-8d5d-bc34525a4515","block_type":"box","text":"Copies of the Active Fund Proxy Voting Policy, Index Equity Fund Proxy Voting Policy, the BAIS Guidelines, the","page_number":185,"box":{"x":102,"y":634,"width":766,"height":11}},{"id":"94aa3f51-42f6-43ab-8c82-a9cc6378da7b","block_type":"box","text":"Global Principles for Benchmark Policies and the BIS Climate and Decarbonization Stewardship Guidelines are","page_number":185,"box":{"x":69,"y":649,"width":784,"height":11}},{"id":"be52cfdc-9a9b-4268-8453-3fc28fbe0ec9","block_type":"box","text":"attached as Appendix B to this SAI. Only those guidelines that are applicable to a par ticular Fund pursuant to the","page_number":185,"box":{"x":69,"y":664,"width":805,"height":11}},{"id":"33eb073d-c3f0-448e-af15-97e67c76ba83","block_type":"box","text":"Active Fund Proxy Voting Policy or the Index Equity Fund Proxy Voting Policy are considered to form a par t of the","page_number":185,"box":{"x":68,"y":679,"width":790,"height":11}},{"id":"14278f33-6759-47c1-a0b7-7eb0f8b5e103","block_type":"box","text":"Fund’s SAI. Information on how each Fund voted proxies relating to por tfolio securities during the most recent 12-","page_number":185,"box":{"x":70,"y":694,"width":810,"height":11}},{"id":"fb7b743c-eeac-459d-8845-ea6053c34a16","block_type":"box","text":"month period ended June 30 is available without charge, (i) at www.blackrock.com/proxyrecords and (ii) on the","page_number":185,"box":{"x":69,"y":709,"width":788,"height":11}},{"id":"add3c379-f08c-47e3-9cb6-420235ce09ea","block_type":"box","text":"Commission’s website at http://www.sec.gov.","page_number":185,"box":{"x":69,"y":724,"width":327,"height":12}},{"id":"720a9a33-ba3b-439c-b79c-5626c0087ea3","block_type":"box","text":"GENERAL INFORMATION","page_number":185,"box":{"x":391,"y":754,"width":195,"height":10}},{"id":"085a225d-0981-4b20-abc8-04efc5e1b678","block_type":"box","text":"Description of Shares","page_number":185,"box":{"x":69,"y":784,"width":156,"height":11}},{"id":"52737257-7d49-4513-9b5e-a7bd2cc729c7","block_type":"box","text":"Shareholders of a Fund are entitled to one vote for each full share held and fractional votes for fractional shares","page_number":185,"box":{"x":102,"y":807,"width":800,"height":9}},{"id":"3f523f5d-bf2e-487c-88e4-30586ca82f6e","block_type":"box","text":"held in the election of Directors and generally on other matters submitted to the vote of shareholders of the Fund.","page_number":185,"box":{"x":69,"y":822,"width":811,"height":11}},{"id":"e8c2f3bc-b3ca-4baa-8942-157ddd8e263e","block_type":"box","text":"Shareholders of a class that bears distribution and/or service expenses have exclusive voting rights with respect to","page_number":185,"box":{"x":69,"y":837,"width":825,"height":11}},{"id":"8f0cc636-26e7-4710-b021-9e495102e522","block_type":"box","text":"matters relating to such distribution and service expenditures. Voting rights are not cumulative, so that the holders of","page_number":185,"box":{"x":69,"y":852,"width":838,"height":11}},{"id":"8765ad1d-033d-4d64-83bc-b95664f020b1","block_type":"box","text":"more than 50% of the shares voting in the election of Directors can, if they choose to do so, elect all the Directors of","page_number":185,"box":{"x":69,"y":867,"width":835,"height":12}},{"id":"8b53f529-d7ab-42bd-87ab-bf3619daf0fd","block_type":"box","text":"a Fund, in which event the holders of the remaining shares would be unable to elect any person as a Director.","page_number":185,"box":{"x":69,"y":882,"width":781,"height":12}},{"id":"9d3bff81-7a93-4403-87be-70d0115264eb","block_type":"box","text":"II-138","page_number":185,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"94a3b264-5129-4362-a1d7-3d6b2b2c175b","block_type":"box","text":"NM1026U-6033063-185/246","page_number":185,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"2b9c6489-0206-4342-98a6-f0fd19fcde61","block_type":"box","text":"No Fund intends to hold annual meetings of shareholders in any year in which the Investment Company Act does","page_number":186,"box":{"x":102,"y":45,"width":801,"height":11}},{"id":"208d0191-c01a-4ba1-a964-7d6b553cce99","block_type":"box","text":"not require shareholders to act upon any of the following matters: (i) election of Directors; (ii) approval of a","page_number":186,"box":{"x":69,"y":60,"width":760,"height":11}},{"id":"29fbc205-bb6a-42bc-bb53-ab23a88a6496","block_type":"box","text":"management agreement; (iii) approval of a distribution agreement; and (iv) ratification of selection of independent","page_number":186,"box":{"x":69,"y":75,"width":810,"height":11}},{"id":"fecab82a-d8ef-425d-9a06-687dfde68e64","block_type":"box","text":"accountants. Shares issued are fully paid and non-assessable and have no preemptive rights. Redemption and","page_number":186,"box":{"x":69,"y":90,"width":790,"height":11}},{"id":"f7fab8a1-65e6-4b37-a198-71d1e9e96702","block_type":"box","text":"conversion rights are discussed elsewhere herein and in each Fund’s Prospectus. Each share of each class of","page_number":186,"box":{"x":69,"y":105,"width":787,"height":11}},{"id":"035e4693-bab9-48ed-9c26-c85021be459d","block_type":"box","text":"Common Stock is entitled to par ticipate equally in dividends and distributions declared by a Fund and in the net","page_number":186,"box":{"x":69,"y":120,"width":797,"height":11}},{"id":"f6951e77-c861-490e-80f2-a64caadd0e90","block_type":"box","text":"assets of the Fund upon liquidation or dissolution after satisfaction of outstanding liabilities.","page_number":186,"box":{"x":69,"y":135,"width":658,"height":12}},{"id":"fc749e44-5c61-43e3-a8f2-dd0d38193170","block_type":"box","text":"For Funds organized as Maryland corporations, the by-laws of the Fund require that a special meeting of","page_number":186,"box":{"x":102,"y":158,"width":741,"height":11}},{"id":"c3272b6d-f41b-46c2-9446-f67f2cff6d6f","block_type":"box","text":"shareholders be held upon the written request of a minimum percentage of the outstanding shares of the Fund","page_number":186,"box":{"x":69,"y":173,"width":790,"height":11}},{"id":"b2bcbc94-8a40-43c5-aa09-f9db5b9082fe","block_type":"box","text":"entitled to vote at such meeting, if they comply with applicable Maryland law.","page_number":186,"box":{"x":69,"y":188,"width":546,"height":12}},{"id":"38a6e26e-7718-4831-943c-a3ec1b17d00c","block_type":"box","text":"Cer tain of the Funds are organized as “Massachusetts business trusts.” Under Massachusetts law,","page_number":186,"box":{"x":102,"y":211,"width":712,"height":11}},{"id":"762dfaf0-ec2c-4016-857e-ab2e0f348532","block_type":"box","text":"shareholders of such a trust may, under cer tain circumstances, be held personally liable as par tners for its","page_number":186,"box":{"x":69,"y":226,"width":765,"height":11}},{"id":"d3ff5f13-ec18-4af9-a90f-6eaee1bfca84","block_type":"box","text":"obligations. However, the Declaration of Trust establishing a trust, a copy of which for each applicable Fund, together","page_number":186,"box":{"x":69,"y":241,"width":834,"height":11}},{"id":"f4e0ff43-66f1-4b2d-9dd0-a09be492d90c","block_type":"box","text":"with all amendments thereto (the “Declaration of Trust”), is on file in the office of the Secretary of the","page_number":186,"box":{"x":68,"y":256,"width":729,"height":11}},{"id":"88e769dd-fc39-4ec7-a26b-96715b2e96d3","block_type":"box","text":"Commonwealth of Massachusetts, contains an express disclaimer of shareholder liability for acts or obligations of","page_number":186,"box":{"x":69,"y":271,"width":815,"height":12}},{"id":"978a7cd2-a510-417f-8761-c8c96af781b1","block_type":"box","text":"the trust and provides for indemnification and reimbursement of expenses out of the trust proper ty for any","page_number":186,"box":{"x":68,"y":286,"width":761,"height":12}},{"id":"2e71c9da-5a17-4597-928d-5af345b0627e","block_type":"box","text":"shareholder held personally liable for the obligations of the trust. The Declaration of Trust also provides that a trust","page_number":186,"box":{"x":69,"y":302,"width":824,"height":11}},{"id":"e0cb2b3c-79df-47af-a7e8-0f033a25c7e2","block_type":"box","text":"may maintain appropriate insurance (for example, fidelity bond and errors and omissions insurance) for the protection","page_number":186,"box":{"x":69,"y":317,"width":839,"height":11}},{"id":"d0eff1d5-31c2-465e-9039-c2e82dbe276e","block_type":"box","text":"of the trust, its shareholders, trustees, officers, employees and agents covering possible tor t and other liabilities.","page_number":186,"box":{"x":69,"y":332,"width":813,"height":11}},{"id":"ccfe14b9-cde9-4594-99d6-56e49cda8b43","block_type":"box","text":"Thus, the risk of a shareholder incurring financial loss on account of shareholder liability is limited to circumstances","page_number":186,"box":{"x":68,"y":347,"width":827,"height":11}},{"id":"a62b4c42-95db-4bc7-9436-2c43aafb1db8","block_type":"box","text":"in which both inadequate insurance existed and the trust itself was unable to meet its obligations.","page_number":186,"box":{"x":70,"y":362,"width":699,"height":11}},{"id":"21269c1f-5af1-4c6d-9cb0-a3fc00504bb8","block_type":"box","text":"Cer tain Funds are organized as Delaware statutory trusts.","page_number":186,"box":{"x":102,"y":385,"width":413,"height":11}},{"id":"a6e65342-fb61-4ba2-bd8d-6bdc8a9fe613","block_type":"box","text":"Additional Information","page_number":186,"box":{"x":68,"y":415,"width":161,"height":9}},{"id":"6eaeec16-800d-4e46-83ad-93f245404fd4","block_type":"box","text":"Under a separate agreement, BlackRock has granted cer tain Funds the right to use the “BlackRock” name and","page_number":186,"box":{"x":102,"y":438,"width":789,"height":11}},{"id":"c9969755-daaf-4f95-b683-a066f9cbf337","block_type":"box","text":"has reserved the right to (i) withdraw its consent to the use of such name by a Fund if the Fund ceases to retain","page_number":186,"box":{"x":69,"y":453,"width":799,"height":11}},{"id":"452a8bb4-c8c8-41a1-b4e1-9726a12aff62","block_type":"box","text":"BlackRock Advisors, LLC or BlackRock Fund Advisors, as applicable, as investment adviser and (ii) to grant the use of","page_number":186,"box":{"x":70,"y":468,"width":837,"height":11}},{"id":"4fdcefb2-d766-4b23-8648-618d5f1a233f","block_type":"box","text":"such name to any other company.","page_number":186,"box":{"x":69,"y":483,"width":238,"height":11}},{"id":"85699c10-1001-47c7-96ad-f2804055d449","block_type":"box","text":"II-139","page_number":186,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"6efd28d9-88df-4547-8a7b-5fb0e361bbdb","block_type":"box","text":"NM1026U-6033063-186/246","page_number":186,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"6364d078-6edd-4043-97fc-e8dc47623970","block_type":"box","text":"APPENDIX A","page_number":187,"box":{"x":438,"y":45,"width":101,"height":10}},{"id":"907c76f4-9d65-438d-9ede-4909ae98d9c1","block_type":"box","text":"Description of Bond Ratings","page_number":187,"box":{"x":377,"y":68,"width":224,"height":13}},{"id":"27582ed6-5f34-4bc9-9f5a-7bfcbf29ca97","block_type":"box","text":"A rating is generally assigned to a fixed-income security at the time of issuance by a credit rating agency","page_number":187,"box":{"x":101,"y":91,"width":743,"height":12}},{"id":"1e5672c7-5d9d-466e-b6f0-e87c3ddecb01","block_type":"box","text":"designated as a nationally recognized statistical rating organization (“NRSRO”) by the SEC. While NRSROs may from","page_number":187,"box":{"x":69,"y":106,"width":827,"height":12}},{"id":"37b5047b-4dd2-4e01-baa1-ece5718c3e8a","block_type":"box","text":"time to time revise such ratings, they under take no obligation to do so, and the ratings given to securities at","page_number":187,"box":{"x":68,"y":122,"width":775,"height":11}},{"id":"87695cd4-0c50-42d0-b2f9-69f95af3b8c2","block_type":"box","text":"issuance do not necessarily represent ratings which would be given to these securities on a par ticular subsequent","page_number":187,"box":{"x":70,"y":137,"width":815,"height":11}},{"id":"24fd363a-6b0d-4893-97e9-b7b0fdabbeb6","block_type":"box","text":"date.","page_number":187,"box":{"x":69,"y":152,"width":34,"height":9}},{"id":"deafd738-3cf8-419e-aa0f-8a32d7f48c1a","block_type":"box","text":"NRSROs may rate specific investments (","page_number":187,"box":{"x":102,"y":174,"width":286,"height":12}},{"id":"5dcf09c1-41af-4e3d-a30d-c83380c06ed4","block_type":"box","text":"e.g.","page_number":187,"box":{"x":390,"y":176,"width":25,"height":10}},{"id":"7284f6f9-78b1-4fe8-ad15-f58ee6acf6b5","block_type":"box","text":", bonds), issuers (","page_number":187,"box":{"x":417,"y":175,"width":128,"height":10}},{"id":"d4e5da6d-61ad-4675-be05-9c610b45a75e","block_type":"box","text":"e.g.","page_number":187,"box":{"x":547,"y":176,"width":25,"height":10}},{"id":"378143f0-a994-48d0-929b-9bcf4fbf17d2","block_type":"box","text":", corporations, governments and financial","page_number":187,"box":{"x":574,"y":174,"width":293,"height":12}},{"id":"c8dfaa60-d392-4b32-b118-b97312bda96c","block_type":"box","text":"institutions) and/or programs (","page_number":187,"box":{"x":70,"y":190,"width":217,"height":11}},{"id":"95ec0e53-e1d4-4a83-a506-550259ae55f0","block_type":"box","text":"e.g.","page_number":187,"box":{"x":289,"y":191,"width":25,"height":10}},{"id":"a78863af-45e5-44d8-80bd-ab5bdb04abda","block_type":"box","text":", commercial paper programs). However, cer tain types of investments may not be","page_number":187,"box":{"x":317,"y":189,"width":578,"height":12}},{"id":"4c213c1c-4cde-48d1-9eb3-b9e798e2559d","block_type":"box","text":"rated by NRSROs, such as cer tain government/sovereign obligations, US agency securities, commercial paper, time","page_number":187,"box":{"x":69,"y":205,"width":826,"height":11}},{"id":"586a2fb3-51e7-4788-9abf-d705247f952d","block_type":"box","text":"deposits at financial institutions, and derivative instruments such as credit default swaps. 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In the case of municipal securities, where one NRSRO provides multiple ratings for the same","page_number":187,"box":{"x":69,"y":295,"width":815,"height":12}},{"id":"fecc6de0-38ca-4501-b375-d4b95ea1cd51","block_type":"box","text":"security (","page_number":187,"box":{"x":69,"y":311,"width":63,"height":11}},{"id":"9d8bd604-68ea-437b-96bc-c41c68e6cb7e","block_type":"box","text":"e.g.","page_number":187,"box":{"x":134,"y":312,"width":25,"height":10}},{"id":"8ae5dc77-f84d-404c-a8d9-905ccba59cbf","block_type":"box","text":", “underlying,” “insured” and/or “enhanced” ratings), BlackRock may consider the security to have the","page_number":187,"box":{"x":161,"y":311,"width":730,"height":11}},{"id":"1ed7f35e-db46-45e0-929a-4ee5abd5627b","block_type":"box","text":"highest of the multiple ratings.","page_number":187,"box":{"x":69,"y":326,"width":216,"height":11}},{"id":"1cb934bf-5de5-44ae-baa0-0625daf9a393","block_type":"box","text":"New issue securities (regardless of type) may not be rated by a NRSRO at the time of their initial offering.","page_number":187,"box":{"x":102,"y":348,"width":751,"height":12}},{"id":"c5773d2c-2619-450d-97f2-ce41406e9492","block_type":"box","text":"Preliminary prospectuses or term sheets for new issue securities may include an expected rating for the security (as","page_number":187,"box":{"x":69,"y":363,"width":830,"height":12}},{"id":"a5ffbd16-6483-403b-97e2-6c0fff402065","block_type":"box","text":"determined by the underwriter and/or issuer) or a NRSRO rating for the issuer of the security. If applicable, when","page_number":187,"box":{"x":69,"y":378,"width":804,"height":12}},{"id":"b299a2a4-fa8a-44f1-abad-9e5216297774","block_type":"box","text":"deciding whether to purchase a new issue security that has not yet been rated by a NRSRO, BlackRock may attribute","page_number":187,"box":{"x":69,"y":394,"width":831,"height":11}},{"id":"2bf5bfcd-6c74-4e9f-8519-69684e6e2a09","block_type":"box","text":"an expected rating to the security based on: (i) the expected rating of the security set for th in the preliminary","page_number":187,"box":{"x":69,"y":409,"width":777,"height":11}},{"id":"9f940e39-0ccc-4e04-af38-6e8bfa913bc0","block_type":"box","text":"prospectus or term sheet for the security; (ii) the NRSRO’s rating for the issuer of the security set for th in the","page_number":187,"box":{"x":70,"y":424,"width":779,"height":11}},{"id":"28e86e8c-24bb-451d-8b53-0a70ac275427","block_type":"box","text":"preliminary prospectus or term sheet for the security; or (iii) with respect to asset-backed securities, the rating of a","page_number":187,"box":{"x":70,"y":439,"width":819,"height":11}},{"id":"2666757d-8767-4fae-bebc-197204575eb0","block_type":"box","text":"prior issuance having a similar structure or the same sponsor.","page_number":187,"box":{"x":70,"y":454,"width":441,"height":11}},{"id":"4c3bdf99-3dff-45d9-ae36-350c61e3f58d","block_type":"box","text":"Where the investment objective of a fund is to track the per formance of an index that includes credit ratings","page_number":187,"box":{"x":101,"y":477,"width":771,"height":11}},{"id":"e7369724-2ef2-42c5-95c4-f8be83dfdee5","block_type":"box","text":"eligibility criteria as par t of its index methodology, the fund may purchase any security within the index, such security","page_number":187,"box":{"x":69,"y":492,"width":832,"height":11}},{"id":"7fa6e674-c3c5-4587-8dc6-8febc40a84b5","block_type":"box","text":"having been determined by the index provider as meeting its credit ratings eligibility criteria. The credit ratings","page_number":187,"box":{"x":69,"y":507,"width":782,"height":11}},{"id":"1faaa84e-3b99-4641-b655-5850decf7fff","block_type":"box","text":"practices of an index provider may differ from BlackRock’s practices, as described above. Fur ther, the fund may","page_number":187,"box":{"x":70,"y":522,"width":796,"height":11}},{"id":"8c10f018-6435-40c4-8c1e-acdce0258bb2","block_type":"box","text":"invest, directly or indirectly, in securities that are not rated by a rating agency or securities with a credit rating that","page_number":187,"box":{"x":70,"y":537,"width":811,"height":12}},{"id":"e7dcbceb-ac5e-4e1e-b364-cfc1af6b1541","block_type":"box","text":"differs from the credit rating specified in its index methodology in various circumstances, including where a security is","page_number":187,"box":{"x":69,"y":552,"width":840,"height":12}},{"id":"738b5b98-0945-4ed3-b605-4d5ccc96514d","block_type":"box","text":"downgraded but not yet removed from an index, following the removal of a security from an index prior to its sale by","page_number":187,"box":{"x":69,"y":567,"width":824,"height":12}},{"id":"18f0952f-66b3-49cf-8a25-5221c278d69b","block_type":"box","text":"the fund or as a result of a corporate action or restructuring affecting an issuer of a security held by the fund.","page_number":187,"box":{"x":68,"y":583,"width":781,"height":11}},{"id":"e04e45db-1aca-4e43-ac1f-0b63a9c5bf98","block_type":"box","text":"Fixed-income securities which are unrated may expose the investor to risks with respect to capacity to pay","page_number":187,"box":{"x":102,"y":606,"width":756,"height":10}},{"id":"4949671c-80bb-4236-a67e-cecbcb977bd8","block_type":"box","text":"interest or repay principal which are similar to the risks of lower-rated speculative bonds. Evaluation of these","page_number":187,"box":{"x":70,"y":620,"width":773,"height":12}},{"id":"02ade0dc-1a0f-407a-96c5-500494fc9e1a","block_type":"box","text":"securities is dependent on BlackRock’s judgment, analysis and experience in the evaluation of such securities.","page_number":187,"box":{"x":69,"y":635,"width":791,"height":12}},{"id":"2c71abd7-a5e9-4d4f-9de4-ebfaa29de259","block_type":"box","text":"Investors should note that the assignment of a rating to a security by an NRSRO may not reflect the effect of","page_number":187,"box":{"x":102,"y":658,"width":776,"height":11}},{"id":"30d3777a-a438-444e-9fab-81ef3bd550fa","block_type":"box","text":"recent developments on the issuer’s ability to make interest and principal payments or on the likelihood of default.","page_number":187,"box":{"x":69,"y":673,"width":818,"height":11}},{"id":"66258220-17c0-4628-b381-8a365dd04c5d","block_type":"box","text":"Securities deemed to be high yield are rated below Baa3 by Moody’s and below BBB- by S&P Global Ratings and","page_number":187,"box":{"x":102,"y":696,"width":799,"height":11}},{"id":"6dc7a7d3-e17e-4bd4-81c8-e91be3d58ccb","block_type":"box","text":"Fitch.","page_number":187,"box":{"x":70,"y":711,"width":35,"height":9}},{"id":"75949fba-6834-457f-a928-af2d3b4a479b","block_type":"box","text":"The descriptions below relate to general long-term and shor t-term obligations of an issuer.","page_number":187,"box":{"x":101,"y":734,"width":643,"height":11}},{"id":"c5f243a5-bcd7-4d04-b968-15d2b6b32fad","block_type":"box","text":"A Description of Moody’s Investors Service, Inc.’s (“Moody’s”) Global Rating Scales","page_number":187,"box":{"x":68,"y":764,"width":616,"height":11}},{"id":"82ee5b71-b59d-41ca-9068-a71460fbb5e4","block_type":"box","text":"Ratings assigned on Moody’s global long-term and shor t-term rating scales are forward-looking opinions of the","page_number":187,"box":{"x":102,"y":787,"width":787,"height":11}},{"id":"ba08d6c8-82ad-424a-8636-dc68227a0c56","block_type":"box","text":"relative credit risks of financial obligations issued by non-financial corporates, financial institutions, structured","page_number":187,"box":{"x":69,"y":802,"width":785,"height":11}},{"id":"d2377965-2617-4d9b-b734-d900f46f0a41","block_type":"box","text":"finance vehicles, project finance vehicles, and public sector entities. Moody’s defines credit risk as the risk that an","page_number":187,"box":{"x":68,"y":817,"width":820,"height":11}},{"id":"3a42a3ba-bb9d-4e48-9293-f2a244fa5878","block_type":"box","text":"entity may not meet its contractual financial obligations as they come due and any estimated financial loss in the","page_number":187,"box":{"x":69,"y":832,"width":807,"height":11}},{"id":"57137b87-58d7-40c0-afc1-83eb437d745c","block_type":"box","text":"event of default or impairment. The contractual financial obligations addressed by Moody’s ratings are those that call","page_number":187,"box":{"x":69,"y":847,"width":835,"height":11}},{"id":"87b60a92-203e-414f-95bd-781d14f9503b","block_type":"box","text":"for, without regard to enforceability, the payment of an ascer tainable amount, which may vary based upon standard","page_number":187,"box":{"x":68,"y":862,"width":822,"height":12}},{"id":"4d5d82ff-6f41-4cb9-8533-7443ef53f812","block_type":"box","text":"sources of variation (","page_number":187,"box":{"x":69,"y":877,"width":149,"height":11}},{"id":"260d2cd1-27db-41a3-b7e0-8c661162d85c","block_type":"box","text":"e.g.","page_number":187,"box":{"x":220,"y":879,"width":25,"height":10}},{"id":"b456e208-7140-42d9-bd79-62b1e050f5e0","block_type":"box","text":", floating interest rates), by an ascer tainable date. Moody’s rating addresses the issuer’s","page_number":187,"box":{"x":247,"y":877,"width":637,"height":12}},{"id":"ca2c63fa-409e-4268-a722-a868b9ab9595","block_type":"box","text":"ability to obtain cash sufficient to service the obligation, and its willingness to pay. Moody’s ratings do not address","page_number":187,"box":{"x":69,"y":892,"width":820,"height":12}},{"id":"52c5bbba-0e59-43c6-b579-195d3e58c09c","block_type":"box","text":"non-standard sources of variation in the amount of the principal obligation (","page_number":187,"box":{"x":69,"y":908,"width":536,"height":11}},{"id":"8cf2efbd-138f-4cfc-84f4-a333aab4ea79","block_type":"box","text":"e.g.","page_number":187,"box":{"x":607,"y":909,"width":25,"height":10}},{"id":"1e145666-7eca-4747-a4fd-2be2ae096dc3","block_type":"box","text":", equity indexed), absent an express","page_number":187,"box":{"x":634,"y":908,"width":257,"height":11}},{"id":"0c557763-c415-455b-94ab-5afd73a7e792","block_type":"box","text":"A-1","page_number":187,"box":{"x":477,"y":943,"width":24,"height":9}},{"id":"3a8710c2-6969-48b4-9c8f-7b38e40fe90f","block_type":"box","text":"NM1026U-6033063-187/246","page_number":187,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"af1153ef-df9c-4018-abd7-0bc7c49c1780","block_type":"box","text":"statement to the contrary in a press release accompanying an initial rating. Long-term ratings are assigned to issuers","page_number":188,"box":{"x":69,"y":45,"width":839,"height":11}},{"id":"e7e0f72d-4d9d-427a-8c90-2ef138c0e187","block_type":"box","text":"or obligations with an original maturity of one year or more and reflect both on the likelihood of a default or","page_number":188,"box":{"x":69,"y":60,"width":761,"height":11}},{"id":"4e0de43d-fdb0-4d8f-9548-981364cee9f6","block_type":"box","text":"impairment on contractual financial obligations and the expected financial loss suffered in the event of default or","page_number":188,"box":{"x":70,"y":75,"width":806,"height":11}},{"id":"d9e8546f-9305-4d9a-aea0-f23c171b43ad","block_type":"box","text":"impairment. Shor t-term ratings are assigned for obligations with an original maturity of thir teen months or less and","page_number":188,"box":{"x":70,"y":90,"width":818,"height":11}},{"id":"0743b814-60ee-4e47-878e-4c495f905a6f","block_type":"box","text":"reflect both on the likelihood of a default or impairment on contractual financial obligations and the expected","page_number":188,"box":{"x":69,"y":105,"width":775,"height":11}},{"id":"433f7008-7c1e-4fd0-9b7d-6e66af84a860","block_type":"box","text":"financial loss suffered in the event of default or impairment. Moody’s issues ratings at the issuer level and","page_number":188,"box":{"x":68,"y":120,"width":764,"height":12}},{"id":"53cae59f-a741-43c5-a2b8-7454ea3cd686","block_type":"box","text":"instrument level on both the long-term scale and the shor t-term scale. Typically, ratings are made publicly available","page_number":188,"box":{"x":70,"y":136,"width":819,"height":11}},{"id":"c710c6b2-6611-46f2-b4c9-1eca06a7b43a","block_type":"box","text":"although private and unpublished ratings may also be assigned.","page_number":188,"box":{"x":69,"y":151,"width":454,"height":11}},{"id":"d02e3e9c-ab00-4445-8e72-45b8e3679ffc","block_type":"box","text":"Moody’s differentiates structured finance ratings from fundamental ratings (","page_number":188,"box":{"x":102,"y":173,"width":542,"height":11}},{"id":"510fda65-1142-42fb-86d4-3324852b4fe8","block_type":"box","text":"i.e.","page_number":188,"box":{"x":646,"y":173,"width":20,"height":9}},{"id":"c7427994-0414-4c8b-8590-d5b12afb3b83","block_type":"box","text":", ratings on nonfinancial","page_number":188,"box":{"x":669,"y":173,"width":169,"height":11}},{"id":"6a9306c4-6ad5-482f-bb3a-226ae1376310","block_type":"box","text":"corporate, financial institution, and public sector entities) on the global long-term scale by adding (sf) to all structured","page_number":188,"box":{"x":69,"y":188,"width":837,"height":12}},{"id":"dfea3f50-db18-49db-9c42-67653bbdad13","block_type":"box","text":"finance ratings. The addition of (sf) to structured finance ratings should eliminate any presumption that such ratings","page_number":188,"box":{"x":68,"y":203,"width":828,"height":12}},{"id":"657ac26c-941c-40fe-8832-fa04799ab710","block_type":"box","text":"and fundamental ratings at the same letter grade level will behave the same. The (sf) indicator for structured finance","page_number":188,"box":{"x":69,"y":218,"width":832,"height":12}},{"id":"e7793ba3-b938-4439-809f-73fba81ff541","block_type":"box","text":"security ratings indicates that otherwise similarly rated structured finance and fundamental securities may have","page_number":188,"box":{"x":69,"y":234,"width":797,"height":11}},{"id":"28120b1d-61b7-4461-9e4c-4ac9888c0037","block_type":"box","text":"different risk characteristics. Through its current methodologies, however, Moody’s aspires to achieve broad","page_number":188,"box":{"x":69,"y":249,"width":771,"height":11}},{"id":"b9a01df7-2310-43eb-8a6a-7be7a1a793db","block_type":"box","text":"expected equivalence in structured finance and fundamental rating per formance when measured over a long period","page_number":188,"box":{"x":69,"y":264,"width":821,"height":11}},{"id":"c63c2172-b370-4ebe-b1a9-35b1a16ca338","block_type":"box","text":"of time.","page_number":188,"box":{"x":69,"y":279,"width":53,"height":9}},{"id":"e1184785-c9a0-4904-9b58-0b8bfa32e73a","block_type":"box","text":"Description of Moody’s Global Long-Term Rating Scale","page_number":188,"box":{"x":69,"y":309,"width":395,"height":11}},{"id":"1cd2868e-5664-493f-84f1-0ed19eaf6602","block_type":"box","text":"Aaa Obligations rated Aaa are judged to be of the highest quality, subject to the lowest level of credit","page_number":188,"box":{"x":68,"y":337,"width":815,"height":11}},{"id":"bae0ca71-d4b7-4d34-aa23-35870cdb6c08","block_type":"box","text":"risk.","page_number":188,"box":{"x":197,"y":352,"width":28,"height":9}},{"id":"e944e73a-50df-4dd1-931e-5d3b2b2060bc","block_type":"box","text":"Aa Obligations rated Aa are judged to be of high quality and are subject to very low credit risk.","page_number":188,"box":{"x":68,"y":372,"width":773,"height":11}},{"id":"51e25961-3916-40fa-b5e4-1a31570bbb57","block_type":"box","text":"A Obligations rated A are judged to be upper-medium grade and are subject to low credit risk.","page_number":188,"box":{"x":68,"y":392,"width":776,"height":12}},{"id":"1bf8c3d3-dc80-4b1c-b369-59feb4d7b79c","block_type":"box","text":"Baa Obligations rated Baa are judged to be medium-grade and subject to moderate credit risk and as","page_number":188,"box":{"x":70,"y":413,"width":813,"height":11}},{"id":"94dd2b4c-42b1-4ee1-a7ac-87e4dd62611e","block_type":"box","text":"such may possess cer tain speculative characteristics.","page_number":188,"box":{"x":196,"y":428,"width":385,"height":11}},{"id":"1a428e41-38a1-45d4-8fe7-de40a7172e55","block_type":"box","text":"Ba Obligations rated Ba are judged to be speculative and are subject to substantial credit risk.","page_number":188,"box":{"x":70,"y":448,"width":775,"height":11}},{"id":"cc7f23bb-cf7c-4814-b614-8077b0547645","block_type":"box","text":"B Obligations rated B are considered speculative and are subject to high credit risk.","page_number":188,"box":{"x":70,"y":468,"width":707,"height":11}},{"id":"abc0a63c-2a9d-4163-8c83-3f4e740892fe","block_type":"box","text":"Caa Obligations rated Caa are judged to be speculative of poor standing and are subject to very high","page_number":188,"box":{"x":69,"y":488,"width":810,"height":11}},{"id":"246416e1-16d9-4e60-85ed-497bba01c155","block_type":"box","text":"credit risk.","page_number":188,"box":{"x":196,"y":503,"width":74,"height":9}},{"id":"6f2c12c9-9311-4da7-b51a-aab1338b9618","block_type":"box","text":"Ca Obligations rated Ca are highly speculative and are likely in, or very near, default, with some","page_number":188,"box":{"x":69,"y":523,"width":783,"height":12}},{"id":"017d7c21-1297-49da-9ade-5585cf5b0726","block_type":"box","text":"prospect of recovery of principal and interest.","page_number":188,"box":{"x":197,"y":538,"width":322,"height":12}},{"id":"b941228d-e211-425c-93a2-1ee6ba7829e3","block_type":"box","text":"C Obligations rated C are the lowest rated and are typically in default, with little prospect for recovery","page_number":188,"box":{"x":69,"y":559,"width":834,"height":11}},{"id":"45741d23-63b2-46d6-a552-0ffb5d987216","block_type":"box","text":"of principal or interest.","page_number":188,"box":{"x":196,"y":574,"width":160,"height":11}},{"id":"c6f5778c-1270-4e8e-820d-13f8d32cdfcc","block_type":"box","text":"Note:","page_number":188,"box":{"x":102,"y":594,"width":37,"height":9}},{"id":"c78d6646-fa93-464a-95d7-89dcf56c531b","block_type":"box","text":"Moody’s appends numerical modifiers 1, 2, and 3 to each generic rating classification from Aa through","page_number":188,"box":{"x":146,"y":594,"width":731,"height":11}},{"id":"48e486ec-d6c4-4c32-a953-7842cc900c47","block_type":"box","text":"Caa. The modifier 1 indicates that the obligation ranks in the higher end of its generic rating category; the modifier 2","page_number":188,"box":{"x":69,"y":609,"width":831,"height":11}},{"id":"8016bc30-4fce-44eb-85c4-6f9e92459f6c","block_type":"box","text":"indicates a mid-range ranking; and the modifier 3 indicates a ranking in the lower end of that generic rating category.","page_number":188,"box":{"x":70,"y":624,"width":829,"height":11}},{"id":"903244ad-7a62-489b-99f1-11aa53d0dd2e","block_type":"box","text":"Additionally, a “(hyb)” indicator is appended to all ratings of hybrid securities issued by banks, insurers, finance","page_number":188,"box":{"x":68,"y":639,"width":795,"height":12}},{"id":"cab49e09-93cc-41ba-9a4b-1f01460b11d6","block_type":"box","text":"companies, and securities firms.","page_number":188,"box":{"x":69,"y":654,"width":232,"height":11}},{"id":"1529cca3-d53e-482c-aaba-4d4ca19819bb","block_type":"box","text":"By their terms, hybrid securities allow for the omission of scheduled dividends, interest, or principal payments,","page_number":188,"box":{"x":102,"y":677,"width":787,"height":11}},{"id":"e01b6aa6-ccd8-4f9c-ab4a-142d9ed12019","block_type":"box","text":"which can potentially result in impairment if such an omission occurs. Hybrid securities may also be subject to","page_number":188,"box":{"x":68,"y":692,"width":788,"height":11}},{"id":"9985d9bd-94cb-405a-a7cd-539e0cba4f1d","block_type":"box","text":"contractually allowable write-downs of principal that could result in impairment. Together with the hybrid indicator, the","page_number":188,"box":{"x":69,"y":707,"width":833,"height":12}},{"id":"2c168b6d-af25-4b1e-a8e9-bf0a1da33a93","block_type":"box","text":"long-term obligation rating assigned to a hybrid security is an expression of the relative credit risk associated with","page_number":188,"box":{"x":70,"y":722,"width":809,"height":12}},{"id":"961be768-86fe-40d6-ad55-8265ee31b7e8","block_type":"box","text":"that security.","page_number":188,"box":{"x":68,"y":738,"width":91,"height":11}},{"id":"fa92465b-3fe6-43fb-8a63-fe434301f717","block_type":"box","text":"Description of Moody’s Global Short-Term Rating Scale","page_number":188,"box":{"x":69,"y":768,"width":400,"height":11}},{"id":"ce7c9a84-99b5-4099-93e7-c3c918d43b0c","block_type":"box","text":"P-1 Ratings of Prime-1 reflect a superior ability to repay shor t-term obligations.","page_number":188,"box":{"x":69,"y":795,"width":658,"height":12}},{"id":"9cc09c2c-09d0-4947-ad6b-e28b25a12ba1","block_type":"box","text":"P-2 Ratings of Prime-2 reflect a strong ability to repay shor t-term obligations.","page_number":188,"box":{"x":69,"y":816,"width":645,"height":11}},{"id":"da2f3744-22b4-4eba-a25c-65780aa71a16","block_type":"box","text":"P-3 Ratings of Prime-3 reflect an acceptable ability to repay shor t-term obligations.","page_number":188,"box":{"x":69,"y":836,"width":686,"height":11}},{"id":"df0fbcf4-b7d5-4a36-93ec-ee0b7bf693da","block_type":"box","text":"NP Issuers (or suppor ting institutions) rated Not Prime do not fall within any of the Prime rating","page_number":188,"box":{"x":70,"y":856,"width":778,"height":11}},{"id":"e3cb59d2-52e9-4c78-9b53-5ef220bf6f4d","block_type":"box","text":"categories.","page_number":188,"box":{"x":196,"y":871,"width":77,"height":11}},{"id":"3b58cab8-43e8-44c3-a286-34f895f37ec4","block_type":"box","text":"A-2","page_number":188,"box":{"x":477,"y":943,"width":23,"height":9}},{"id":"24b4ac96-4f6b-4c51-9c7b-0e1be263656f","block_type":"box","text":"NM1026U-6033063-188/246","page_number":188,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"722ba7d2-7f53-4a61-af49-f366c11d7c22","block_type":"box","text":"Description of Moody’s U.S. Municipal Short-Term Debt and Demand Obligation Ratings","page_number":189,"box":{"x":69,"y":45,"width":637,"height":11}},{"id":"70bf8868-b028-4e88-8693-b318b60e4578","block_type":"box","text":"Description of Moody’s Short-Term Obligation Ratings","page_number":189,"box":{"x":69,"y":75,"width":391,"height":11}},{"id":"3da3771a-01e4-4537-93c3-a772511a5e5f","block_type":"box","text":"Moody’s uses the global shor t-term Prime rating scale for commercial paper issued by U.S. municipalities and","page_number":189,"box":{"x":102,"y":98,"width":784,"height":11}},{"id":"a9012bae-5265-4ab8-91ca-0c4b4bac8e73","block_type":"box","text":"nonprofits. These commercial paper programs may be backed by external letters of credit or liquidity facilities, or by","page_number":189,"box":{"x":69,"y":113,"width":824,"height":11}},{"id":"41e2cbaf-2087-4681-85ed-b31e89cb59c1","block_type":"box","text":"an issuer’s self-liquidity.","page_number":189,"box":{"x":69,"y":128,"width":170,"height":11}},{"id":"97a85e11-6bc1-42ec-9f83-759503161ef4","block_type":"box","text":"For other shor t-term municipal obligations, Moody’s uses one of two other shor t-term rating scales, the","page_number":189,"box":{"x":102,"y":150,"width":736,"height":12}},{"id":"569af151-1e80-48e2-a45f-e99bc6f90b03","block_type":"box","text":"Municipal Investment Grade (“MIG”) and Variable Municipal Investment Grade (“VMIG”) scales discussed below.","page_number":189,"box":{"x":70,"y":166,"width":796,"height":11}},{"id":"450feae4-7a3e-473f-ba36-bac0c59af550","block_type":"box","text":"Moody’s uses the MIG scale for U.S. municipal cash flow notes, bond anticipation notes and cer tain other shor t","page_number":189,"box":{"x":102,"y":188,"width":803,"height":11}},{"id":"d1eddfc4-577b-491f-93c7-3aded6cccd8f","block_type":"box","text":"term obligations, which typically mature in three years or less. Under cer tain circumstances, Moody’s uses the MIG","page_number":189,"box":{"x":68,"y":203,"width":823,"height":12}},{"id":"935ad1cc-921e-4966-960f-951f7f7611fc","block_type":"box","text":"scale for bond anticipation notes with maturities of up to five years.","page_number":189,"box":{"x":69,"y":218,"width":480,"height":12}},{"id":"47a004a3-e545-4b8e-b1f3-b6f5ccf3bd12","block_type":"box","text":"MIG Scale","page_number":189,"box":{"x":102,"y":241,"width":71,"height":9}},{"id":"6731702e-9394-4956-a108-ad341ef97f91","block_type":"box","text":"MIG 1 This designation denotes superior credit quality. Excellent protection is afforded by established","page_number":189,"box":{"x":70,"y":269,"width":802,"height":11}},{"id":"e3064351-a3b2-4d95-adce-805c69fd72e4","block_type":"box","text":"cash flows, highly reliable liquidity suppor t, or demonstrated broad-based access to the market for","page_number":189,"box":{"x":196,"y":284,"width":703,"height":11}},{"id":"ed50c46b-886f-4c3c-b09a-56f9ea8bd78d","block_type":"box","text":"refinancing.","page_number":189,"box":{"x":197,"y":299,"width":80,"height":11}},{"id":"e3963083-d24f-4e10-83cf-ef62895b43c7","block_type":"box","text":"MIG 2 This designation denotes strong credit quality. Margins of protection are ample, although not as","page_number":189,"box":{"x":70,"y":319,"width":809,"height":12}},{"id":"ab7866e0-674c-44c6-8b7f-5d9ab5c49d85","block_type":"box","text":"large as in the preceding group.","page_number":189,"box":{"x":197,"y":335,"width":224,"height":11}},{"id":"19a6a508-b527-4e57-9a45-deadd4a23167","block_type":"box","text":"MIG 3 This designation denotes acceptable credit quality. Liquidity and cash-flow protection may be","page_number":189,"box":{"x":70,"y":355,"width":785,"height":11}},{"id":"e86bbd48-bb34-4f4e-917e-122fc64871d3","block_type":"box","text":"narrow, and market access for refinancing is likely to be less well-established.","page_number":189,"box":{"x":197,"y":370,"width":554,"height":11}},{"id":"963ceb78-8d43-4b57-a515-14e51ddeea51","block_type":"box","text":"SG This designation denotes speculative-grade credit quality. Debt instruments in this category may","page_number":189,"box":{"x":69,"y":390,"width":813,"height":11}},{"id":"4ff576ef-1b96-4a53-9e66-f0fb7b59abb0","block_type":"box","text":"lack sufficient margins of protection.","page_number":189,"box":{"x":197,"y":405,"width":259,"height":11}},{"id":"49b786f6-ec3a-404a-8ac8-b89a7c2c560f","block_type":"box","text":"Description of Moody’s Demand Obligation Ratings","page_number":189,"box":{"x":69,"y":433,"width":371,"height":11}},{"id":"8433af51-a2bd-48e5-b859-23c92d968389","block_type":"box","text":"In the case of variable rate demand obligations (“VRDOs”), a two-component rating is assigned. The components","page_number":189,"box":{"x":102,"y":455,"width":804,"height":12}},{"id":"e91acca1-fa35-4c4f-a496-e798b5986d3f","block_type":"box","text":"are a long-term rating and a shor t-term demand obligation rating. The long-term rating addresses the issuer’s ability","page_number":189,"box":{"x":69,"y":471,"width":826,"height":11}},{"id":"dca0f14f-60bf-403f-97bc-e3a9585ff1e0","block_type":"box","text":"to meet scheduled principal and interest payments. The shor t-term demand obligation rating addresses the ability of","page_number":189,"box":{"x":68,"y":486,"width":832,"height":11}},{"id":"55968e18-8e3b-48b3-9878-ed00e047994f","block_type":"box","text":"the issuer or the liquidity provider to make payments associated with the purchase-price-upon-demand feature","page_number":189,"box":{"x":68,"y":501,"width":784,"height":11}},{"id":"e31adb27-e8a1-490f-9238-3e1ccb47416b","block_type":"box","text":"(“demand feature”) of the VRDO. The shor t-term demand obligation rating uses the VMIG scale. VMIG ratings with","page_number":189,"box":{"x":69,"y":516,"width":811,"height":11}},{"id":"358a0ead-1a4c-4ef9-84b8-51bc6aff3c69","block_type":"box","text":"liquidity suppor t use as an input the shor t-term Counterpar ty Risk Assessment of the suppor t provider, or the long","page_number":189,"box":{"x":70,"y":531,"width":819,"height":11}},{"id":"ea3b8328-69fd-4724-a293-3a0064bccfcf","block_type":"box","text":"term rating of the underlying obligor in the absence of third par ty liquidity suppor t. Transitions of VMIG ratings of","page_number":189,"box":{"x":68,"y":546,"width":802,"height":11}},{"id":"d34ff842-fdcb-4d2d-aeea-0eb3db26d413","block_type":"box","text":"demand obligations with conditional liquidity suppor t differ from transitions on the Prime scale to reflect the risk that","page_number":189,"box":{"x":69,"y":561,"width":833,"height":11}},{"id":"59be1f9c-c74e-4ad6-9819-53b1e8312798","block_type":"box","text":"external liquidity suppor t will terminate if the issuer’s long-term rating drops below investment grade.","page_number":189,"box":{"x":69,"y":576,"width":719,"height":12}},{"id":"2c9fba1e-213e-4450-96b4-9fb512084838","block_type":"box","text":"Moody’s typically assigns the VMIG shor t-term demand obligation rating if the frequency of the demand feature is","page_number":189,"box":{"x":102,"y":599,"width":807,"height":11}},{"id":"75c1c579-be55-405f-b46e-d967c696110b","block_type":"box","text":"less than every three years. If the frequency of the demand feature is less than three years but the purchase price is","page_number":189,"box":{"x":70,"y":614,"width":833,"height":11}},{"id":"2c3b772f-07a7-4902-9774-42c2b2ba9897","block_type":"box","text":"payable only with remarketing proceeds, the shor t-term demand obligation rating is “NR”.","page_number":189,"box":{"x":70,"y":629,"width":635,"height":11}},{"id":"e988a537-ae0d-4c6a-be21-bd39bbfd275a","block_type":"box","text":"VMIG Scale","page_number":189,"box":{"x":101,"y":652,"width":81,"height":9}},{"id":"a1657bff-859a-485d-b8ea-a2e9c4aa1a61","block_type":"box","text":"VMIG 1 This designation denotes superior credit quality. Excellent protection is afforded by the superior","page_number":189,"box":{"x":68,"y":680,"width":808,"height":11}},{"id":"95d24642-8fd2-4ab1-81d1-2ee038a9201e","block_type":"box","text":"shor t-term credit strength of the liquidity provider and structural and legal protections that ensure","page_number":189,"box":{"x":196,"y":695,"width":695,"height":11}},{"id":"2df85bf3-a957-49d9-831a-3e3bd891d69f","block_type":"box","text":"the timely payment of purchase price upon demand.","page_number":189,"box":{"x":195,"y":710,"width":370,"height":11}},{"id":"16eb4acd-1910-470c-b648-c0e3bb72da22","block_type":"box","text":"VMIG 2 This designation denotes strong credit quality. Good protection is afforded by the strong shor t-term","page_number":189,"box":{"x":68,"y":730,"width":834,"height":11}},{"id":"fee81a6a-a540-4f25-b358-e9ef071d8919","block_type":"box","text":"credit strength of the liquidity provider and structural and legal protections that ensure the timely","page_number":189,"box":{"x":196,"y":745,"width":691,"height":11}},{"id":"01fadc1b-c320-4862-a296-0f3271695077","block_type":"box","text":"payment of purchase price upon demand.","page_number":189,"box":{"x":197,"y":760,"width":294,"height":11}},{"id":"8388a1f0-c3c1-4fe9-b6cd-0d7ab97ccf7f","block_type":"box","text":"VMIG 3 This designation denotes acceptable credit quality. Adequate protection is afforded by the","page_number":189,"box":{"x":68,"y":780,"width":768,"height":12}},{"id":"eed66762-fb18-4008-9a8c-048930211d0b","block_type":"box","text":"satisfactory shor t-term credit strength of the liquidity provider and structural and legal protections","page_number":189,"box":{"x":196,"y":795,"width":697,"height":12}},{"id":"a8d7e588-2f50-46c0-bc12-d353e5310531","block_type":"box","text":"that ensure the timely payment of purchase price upon demand.","page_number":189,"box":{"x":195,"y":811,"width":457,"height":11}},{"id":"d12b723e-800f-4049-829e-1f9722895f9d","block_type":"box","text":"SG This designation denotes speculative-grade credit quality. Demand features rated in this category","page_number":189,"box":{"x":69,"y":831,"width":820,"height":11}},{"id":"1c83bebc-1f95-4edc-b490-2d2bfc55d994","block_type":"box","text":"may be suppor ted by a liquidity provider that does not have a sufficiently strong shor t-term rating or","page_number":189,"box":{"x":197,"y":846,"width":711,"height":11}},{"id":"633e6087-22d1-4151-b00f-43fe7f151528","block_type":"box","text":"may lack the structural or legal protections necessary to ensure the timely payment of purchase","page_number":189,"box":{"x":197,"y":861,"width":684,"height":11}},{"id":"44035678-7e9a-4dea-b61b-a20b1aa9de41","block_type":"box","text":"price upon demand.","page_number":189,"box":{"x":197,"y":876,"width":139,"height":11}},{"id":"b67c9511-ded8-4661-b6c1-9a1f4239b094","block_type":"box","text":"A-3","page_number":189,"box":{"x":477,"y":943,"width":23,"height":9}},{"id":"4296c9a2-cdc7-4efa-ad54-6bf409aaa73a","block_type":"box","text":"NM1026U-6033063-189/246","page_number":189,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"f14ff8b5-0750-444a-a667-365de3dfa5ca","block_type":"box","text":"Description of S&P Global Ratings (“S&P”), a Division of S&P Global Inc., Issue Credit Ratings","page_number":190,"box":{"x":69,"y":45,"width":691,"height":11}},{"id":"31fcce76-948f-4e4c-b7ab-a264e57cf7f8","block_type":"box","text":"An S&P issue credit rating is a forward-looking opinion about the creditwor thiness of an obligor with respect to a","page_number":190,"box":{"x":101,"y":67,"width":801,"height":12}},{"id":"7dd07030-3e84-442e-832f-d137d5e032b3","block_type":"box","text":"specific financial obligation, a specific class of financial obligations, or a specific financial program (including ratings","page_number":190,"box":{"x":69,"y":82,"width":829,"height":12}},{"id":"d7d91e6d-57ca-4eeb-90ba-9949cae24a36","block_type":"box","text":"on medium-term note programs and commercial paper programs). It takes into consideration the creditwor thiness of","page_number":190,"box":{"x":69,"y":98,"width":831,"height":11}},{"id":"ea8c70df-9919-49f0-8793-510a7bd91d33","block_type":"box","text":"guarantors, insurers, or other forms of credit enhancement on the obligation and takes into account the currency in","page_number":190,"box":{"x":68,"y":113,"width":823,"height":11}},{"id":"2aba5aab-ee48-4470-a193-77520181628c","block_type":"box","text":"which the obligation is denominated. The opinion reflects S&P’s view of the obligor’s capacity and willingness to meet","page_number":190,"box":{"x":68,"y":128,"width":841,"height":11}},{"id":"23ac0ee1-8b86-48c6-af4a-7257ea644f95","block_type":"box","text":"its financial commitments as they come due, and this opinion may assess terms, such as collateral security and","page_number":190,"box":{"x":70,"y":143,"width":801,"height":11}},{"id":"380d5f38-3155-42fa-a2c7-03dcd1e3438d","block_type":"box","text":"subordination, which could affect ultimate payment in the event of default.","page_number":190,"box":{"x":69,"y":158,"width":530,"height":11}},{"id":"53b839aa-cb31-44b8-b326-2b62fa3f9ff7","block_type":"box","text":"Issue credit ratings can be either long-term or shor t-term. Shor t-term issue credit ratings are generally assigned","page_number":190,"box":{"x":102,"y":181,"width":796,"height":11}},{"id":"b9dc0312-3aaa-4eb2-8cad-19d5ac96efe7","block_type":"box","text":"to those obligations considered shor t-term in the relevant market, typically with an original maturity of no more than","page_number":190,"box":{"x":68,"y":196,"width":825,"height":11}},{"id":"8e6234f9-a43e-4c28-8845-4d1c25ac5af3","block_type":"box","text":"365 days. Shor t-term issue credit ratings are also used to indicate the creditwor thiness of an obligor with respect to","page_number":190,"box":{"x":69,"y":211,"width":832,"height":11}},{"id":"13ec40b8-3875-4465-8bed-0c7d7172fc42","block_type":"box","text":"put features on long-term obligations. S&P would typically assign a long-term issue credit rating to an obligation with","page_number":190,"box":{"x":70,"y":226,"width":826,"height":11}},{"id":"b16ad9e0-e16b-4436-983a-621642fa9b98","block_type":"box","text":"an original maturity of greater than 365 days. However, the ratings S&P assigns to cer tain instruments may diverge","page_number":190,"box":{"x":69,"y":241,"width":823,"height":11}},{"id":"996d55f6-450f-4d72-8aee-68e47dbaf3a8","block_type":"box","text":"from these guidelines based on market practices. Medium-term notes are assigned long-term ratings.","page_number":190,"box":{"x":68,"y":256,"width":724,"height":12}},{"id":"a19f62f7-0294-4816-8619-bf60cbab521c","block_type":"box","text":"Issue credit ratings are based, in varying degrees, on S&P’s analysis of the following considerations:","page_number":190,"box":{"x":102,"y":279,"width":718,"height":11}},{"id":"e6c8cdd6-01c5-4235-b016-c857601f62ff","block_type":"box","text":"•","page_number":190,"box":{"x":69,"y":302,"width":6,"height":5}},{"id":"75424030-3c21-4aaa-b48a-d4d09b33b297","block_type":"box","text":"The likelihood of payment—the capacity and willingness of the obligor to meet its financial commitments on an","page_number":190,"box":{"x":101,"y":299,"width":790,"height":11}},{"id":"8d5e0c62-e67a-411e-a6e8-058503eba682","block_type":"box","text":"obligation in accordance with the terms of the obligation;","page_number":190,"box":{"x":102,"y":314,"width":404,"height":12}},{"id":"66986304-c3ee-41e0-8f74-9e5bf5225390","block_type":"box","text":"•","page_number":190,"box":{"x":69,"y":337,"width":6,"height":5}},{"id":"885d52a8-1ac5-4332-bb6b-98c694f5a501","block_type":"box","text":"The nature and provisions of the financial obligation, and the promise S&P imputes; and","page_number":190,"box":{"x":101,"y":334,"width":629,"height":12}},{"id":"8097c3df-d704-45a4-9c8d-4aa252b52582","block_type":"box","text":"•","page_number":190,"box":{"x":69,"y":357,"width":6,"height":5}},{"id":"f8fa2363-38f8-49b4-a33c-c8afaddfff80","block_type":"box","text":"The protection afforded by, and relative position of, the financial obligation in the event of a bankruptcy,","page_number":190,"box":{"x":101,"y":355,"width":738,"height":11}},{"id":"a73153e6-f7c1-4e55-a70a-2b27fb83eba1","block_type":"box","text":"reorganization, or other arrangement under the laws of bankruptcy and other laws affecting creditors’ rights.","page_number":190,"box":{"x":102,"y":370,"width":770,"height":11}},{"id":"d8286be3-dc2a-4f05-b6c2-ab714cc1e285","block_type":"box","text":"An issue rating is an assessment of default risk but may incorporate an assessment of relative seniority or","page_number":190,"box":{"x":101,"y":392,"width":763,"height":12}},{"id":"4b0a3a57-9dbd-4c8c-8b4c-713e1cf0cfad","block_type":"box","text":"ultimate recovery in the event of default. Junior obligations are typically rated lower than senior obligations, to reflect","page_number":190,"box":{"x":69,"y":407,"width":833,"height":12}},{"id":"6d3836d5-4e7a-468b-8aa5-4fd38ca1893a","block_type":"box","text":"lower priority in bankruptcy, as noted above. (Such differentiation may apply when an entity has both senior and","page_number":190,"box":{"x":70,"y":423,"width":794,"height":11}},{"id":"5639945e-3ca6-4860-bfa6-0340a60be372","block_type":"box","text":"subordinated obligations, secured and unsecured obligations, or operating company and holding company","page_number":190,"box":{"x":69,"y":438,"width":754,"height":11}},{"id":"fe44334a-ec7a-40cf-a2b0-cc736939ad65","block_type":"box","text":"obligations.)","page_number":190,"box":{"x":69,"y":453,"width":86,"height":11}},{"id":"96c273f0-9d4b-43b7-9cee-158d99c63f49","block_type":"box","text":"Long-Term Issue Credit Ratings*","page_number":190,"box":{"x":69,"y":483,"width":236,"height":11}},{"id":"414cd940-d39c-41c1-9718-6f0ae5602351","block_type":"box","text":"AAA An obligation rated ‘AAA’ has the highest rating assigned by S&P. The obligor’s capacity to meet its","page_number":190,"box":{"x":68,"y":511,"width":833,"height":11}},{"id":"31580835-dfc4-4475-a765-baab4e55c405","block_type":"box","text":"financial commitments on the obligation is extremely strong.","page_number":190,"box":{"x":196,"y":526,"width":429,"height":11}},{"id":"eac6a5ca-76f4-4e19-9bbb-43318a41f172","block_type":"box","text":"AA An obligation rated ‘AA’ differs from the highest-rated obligations only to a small degree. The","page_number":190,"box":{"x":68,"y":546,"width":788,"height":11}},{"id":"08f5ecd3-8f19-44e8-8c4a-e974632e98ee","block_type":"box","text":"obligor’s capacity to meet its financial commitments on the obligation is very strong.","page_number":190,"box":{"x":196,"y":561,"width":602,"height":11}},{"id":"3b1e1eca-b784-4be4-b910-54ae69ffa2c9","block_type":"box","text":"A An obligation rated ‘A’ is somewhat more susceptible to the adverse effects of changes in","page_number":190,"box":{"x":68,"y":581,"width":770,"height":12}},{"id":"2ca3b316-683b-40f3-867c-b0d90da574d7","block_type":"box","text":"circumstances and economic conditions than obligations in higher-rated categories. However, the","page_number":190,"box":{"x":196,"y":597,"width":692,"height":11}},{"id":"509e8745-59a4-4c03-b06d-c06c12b080db","block_type":"box","text":"obligor’s capacity to meet its financial commitments on the obligation is still strong.","page_number":190,"box":{"x":196,"y":612,"width":598,"height":11}},{"id":"40442583-44fc-4a32-a3ee-dc7d520b6dc3","block_type":"box","text":"BBB An obligation rated ‘BBB’ exhibits adequate protection parameters. However, adverse economic","page_number":190,"box":{"x":70,"y":632,"width":806,"height":11}},{"id":"807bb66b-4c58-4aa2-ae3f-fd6f211d10c8","block_type":"box","text":"conditions or changing circumstances are more likely to weaken the obligor’s capacity to meet its","page_number":190,"box":{"x":196,"y":647,"width":694,"height":11}},{"id":"e7273866-9368-4fe8-a231-12314b072134","block_type":"box","text":"financial commitments on the obligation.","page_number":190,"box":{"x":196,"y":662,"width":289,"height":11}},{"id":"4697ff07-6722-43f0-bd5f-426a02e2ae5a","block_type":"box","text":"BB,","page_number":190,"box":{"x":70,"y":682,"width":22,"height":11}},{"id":"61f5c6ab-afaf-4349-b85b-ad3acea8f041","block_type":"box","text":"B,","page_number":190,"box":{"x":70,"y":697,"width":12,"height":11}},{"id":"29ecd0c1-60ff-48e0-beae-09c4bbc0b40b","block_type":"box","text":"CCC,","page_number":190,"box":{"x":69,"y":712,"width":33,"height":11}},{"id":"d09f136c-7116-4aad-b5f7-33853e99e8c9","block_type":"box","text":"CC,","page_number":190,"box":{"x":69,"y":728,"width":23,"height":10}},{"id":"219e90bf-9424-4146-bb8d-ca3c3e8d93e4","block_type":"box","text":"and C","page_number":190,"box":{"x":69,"y":743,"width":40,"height":9}},{"id":"0dcb8b00-79ed-4bcb-b8ef-6a811433f2aa","block_type":"box","text":"Obligations rated ‘BB’, ‘B’, ‘CCC’, ‘CC’, and ‘C’ are regarded as having significant speculative","page_number":190,"box":{"x":196,"y":682,"width":667,"height":11}},{"id":"952cb2f5-4d1f-4341-8b2b-6541de722b69","block_type":"box","text":"characteristics. ‘BB’ indicates the least degree of speculation and ‘C’ the highest. While such","page_number":190,"box":{"x":196,"y":697,"width":667,"height":12}},{"id":"190100c6-c690-4c8c-95f3-c47bd972e73d","block_type":"box","text":"obligations will likely have some quality and protective characteristics, these may be outweighed by","page_number":190,"box":{"x":196,"y":713,"width":707,"height":11}},{"id":"00208a56-4fe0-4f33-b6c3-bfe74fc43627","block_type":"box","text":"large uncer tainties or major exposure to adverse conditions.","page_number":190,"box":{"x":197,"y":728,"width":428,"height":11}},{"id":"227ea6ed-0e65-465b-b482-1ae874d847bc","block_type":"box","text":"BB An obligation rated ‘BB’ is less vulnerable to nonpayment than other speculative issues. However, it","page_number":190,"box":{"x":70,"y":763,"width":838,"height":11}},{"id":"f9ffb6e3-5969-426f-b56d-692a545bc8b3","block_type":"box","text":"faces major ongoing uncer tainties or exposure to adverse business, financial, or economic","page_number":190,"box":{"x":196,"y":778,"width":646,"height":11}},{"id":"fc2f88c0-aaed-42f5-96f1-de2d9608b46d","block_type":"box","text":"conditions that could lead to the obligor’s inadequate capacity to meet its financial commitments","page_number":190,"box":{"x":196,"y":793,"width":692,"height":11}},{"id":"231b8499-723e-4486-8f7e-c162aa600da7","block_type":"box","text":"on the obligation.","page_number":190,"box":{"x":196,"y":808,"width":122,"height":11}},{"id":"9ee5a5c4-b300-4f8f-8c35-10f2a5eb4a4d","block_type":"box","text":"B An obligation rated ‘B’ is more vulnerable to nonpayment than obligations rated ‘BB’, but the obligor","page_number":190,"box":{"x":70,"y":828,"width":840,"height":12}},{"id":"d43ea4af-8865-4602-8a40-1a8f5f638833","block_type":"box","text":"currently has the capacity to meet its financial commitments on the obligation. Adverse business,","page_number":190,"box":{"x":196,"y":843,"width":695,"height":12}},{"id":"3b3b2564-79e2-468c-89a5-938885b57d5b","block_type":"box","text":"financial, or economic conditions will likely impair the obligor’s capacity or willingness to meet its","page_number":190,"box":{"x":196,"y":858,"width":691,"height":12}},{"id":"6929515c-1b2a-4b73-bb1f-06a5e42bb0c7","block_type":"box","text":"financial commitments on the obligation.","page_number":190,"box":{"x":196,"y":874,"width":289,"height":11}},{"id":"2f5c3465-7e2c-482f-944d-47ca8d67635b","block_type":"box","text":"A-4","page_number":190,"box":{"x":477,"y":943,"width":24,"height":9}},{"id":"b76662b0-d040-41c3-a383-22bef6f5a7ec","block_type":"box","text":"NM1026U-6033063-190/246","page_number":190,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"2494b205-7eb4-4692-890d-b47bf65195e5","block_type":"box","text":"CCC An obligation rated ‘CCC’ is currently vulnerable to nonpayment and is dependent upon favorable","page_number":191,"box":{"x":69,"y":48,"width":816,"height":12}},{"id":"707e4c3b-f3c2-499f-acc8-7a5a869a0374","block_type":"box","text":"business, financial, and economic conditions for the obligor to meet its financial commitments on","page_number":191,"box":{"x":196,"y":63,"width":695,"height":12}},{"id":"7abf56fc-260a-40be-a85c-bb8f3c2c104e","block_type":"box","text":"the obligation. In the event of adverse business, financial, or economic conditions, the obligor is","page_number":191,"box":{"x":195,"y":79,"width":687,"height":11}},{"id":"9c13b5f7-0f24-4c2e-b029-53634114e101","block_type":"box","text":"not likely to have the capacity to meet its financial commitments on the obligation.","page_number":191,"box":{"x":197,"y":94,"width":586,"height":11}},{"id":"2ccc046f-4abe-4312-958f-d0792e23946e","block_type":"box","text":"CC An obligation rated ‘CC’ is currently highly vulnerable to nonpayment. The ‘CC’ rating is used when","page_number":191,"box":{"x":69,"y":114,"width":826,"height":11}},{"id":"41da75a3-189f-4317-b425-98dfd2847a6d","block_type":"box","text":"a default has not yet occurred but S&P expects default to be a vir tual cer tainty, regardless of the","page_number":191,"box":{"x":196,"y":129,"width":692,"height":11}},{"id":"e78d8291-6dc0-475e-9e48-16a09d1a4ae0","block_type":"box","text":"anticipated time to default.","page_number":191,"box":{"x":196,"y":144,"width":191,"height":11}},{"id":"c1831f40-c5ed-4b95-9b0e-2797eeb65eaf","block_type":"box","text":"C An obligation rated ‘C’ is currently highly vulnerable to nonpayment, and the obligation is expected","page_number":191,"box":{"x":69,"y":164,"width":826,"height":12}},{"id":"bfd7596a-11fd-43b4-91a0-4a002ab1cb5c","block_type":"box","text":"to have lower relative seniority or lower ultimate recovery compared with obligations that are rated","page_number":191,"box":{"x":195,"y":180,"width":700,"height":11}},{"id":"dd8954ae-1d73-4bb3-81a3-5f05d12f405e","block_type":"box","text":"higher.","page_number":191,"box":{"x":197,"y":195,"width":45,"height":11}},{"id":"47efa4dc-464e-434c-98b6-7a472ffa7a50","block_type":"box","text":"D An obligation rated ‘D’ is in default or in breach of an imputed promise. For non-hybrid capital","page_number":191,"box":{"x":70,"y":215,"width":789,"height":11}},{"id":"91988ef3-954a-46e1-a109-e8fe0011e5ec","block_type":"box","text":"instruments, the ‘D’ rating category is used when payments on an obligation are not made on the","page_number":191,"box":{"x":197,"y":230,"width":695,"height":11}},{"id":"6b83ea63-8116-483a-a1bf-ec9311e1e8d2","block_type":"box","text":"date due, unless S&P believes that such payments will be made within five business days in the","page_number":191,"box":{"x":196,"y":245,"width":686,"height":11}},{"id":"9468a7da-e00e-428d-a1ff-700f58535da1","block_type":"box","text":"absence of a stated grace period or within the earlier of the stated grace period or 30 calendar","page_number":191,"box":{"x":196,"y":260,"width":676,"height":11}},{"id":"e991bd30-7a38-48ab-80b1-aff1f054c5a0","block_type":"box","text":"days. The ‘D’ rating also will be used upon the filing of a bankruptcy petition or the taking of similar","page_number":191,"box":{"x":196,"y":275,"width":708,"height":11}},{"id":"baa537a7-8c86-449c-b6b4-74eb064e2e43","block_type":"box","text":"action and where default on an obligation is a vir tual cer tainty, for example due to automatic stay","page_number":191,"box":{"x":196,"y":290,"width":694,"height":12}},{"id":"7eb3d647-177d-4c73-8525-3f8cdced981d","block_type":"box","text":"provisions. A rating on an obligation is lowered to ‘D’ if it is subject to a distressed debt","page_number":191,"box":{"x":197,"y":305,"width":626,"height":12}},{"id":"d00cca10-561f-4f57-80d6-0e6407c40fc6","block_type":"box","text":"restructuring.","page_number":191,"box":{"x":197,"y":321,"width":92,"height":11}},{"id":"3121e325-ee88-430d-a80e-2dfd847d27d2","block_type":"box","text":"*Ratings from ‘AA’ to ‘CCC’ may be modified by the addition of a plus (+) or minus (-) sign to show relative","page_number":191,"box":{"x":103,"y":341,"width":756,"height":11}},{"id":"f841d7d6-79dd-4d0d-a05a-f9b384f35bdc","block_type":"box","text":"standing within the rating categories.","page_number":191,"box":{"x":69,"y":356,"width":262,"height":11}},{"id":"e23d611b-de59-43d6-aece-6ffaacf2a354","block_type":"box","text":"Short-Term Issue Credit Ratings","page_number":191,"box":{"x":68,"y":386,"width":233,"height":11}},{"id":"889f8916-61ab-4da9-a15a-af14a175e476","block_type":"box","text":"A-1 A shor t-term obligation rated ‘A-1’ is rated in the highest category by S&P. The obligor’s capacity to","page_number":191,"box":{"x":68,"y":414,"width":833,"height":11}},{"id":"e8e9caa9-06cc-4025-9c30-90f75a27af2d","block_type":"box","text":"meet its financial commitments on the obligation is strong. Within this category, cer tain obligations","page_number":191,"box":{"x":197,"y":429,"width":707,"height":11}},{"id":"4a4091cb-5f05-4bd5-abbe-7b81918fc74c","block_type":"box","text":"are designated with a plus sign (+). This indicates that the obligor’s capacity to meet its financial","page_number":191,"box":{"x":196,"y":444,"width":691,"height":11}},{"id":"8b4a21de-891c-493f-8b02-2ad0f7cfa42d","block_type":"box","text":"commitments on these obligations is extremely strong.","page_number":191,"box":{"x":196,"y":459,"width":390,"height":11}},{"id":"83c61f41-59f4-4fe2-968a-c761a704b362","block_type":"box","text":"A-2 A shor t-term obligation rated ‘A-2’ is somewhat more susceptible to the adverse effects of changes","page_number":191,"box":{"x":68,"y":479,"width":837,"height":12}},{"id":"7fad72b1-eeb6-4e66-8354-ad15f01f4f8c","block_type":"box","text":"in circumstances and economic conditions than obligations in higher rating categories. However,","page_number":191,"box":{"x":197,"y":495,"width":684,"height":11}},{"id":"d79046c4-33c1-49bf-b5c7-f79a3ed50efd","block_type":"box","text":"the obligor’s capacity to meet its financial commitments on the obligation is satisfactory.","page_number":191,"box":{"x":195,"y":509,"width":634,"height":12}},{"id":"b64ada26-3bc6-491b-a7c2-a11987a48ff9","block_type":"box","text":"A-3 A shor t-term obligation rated ‘A-3’ exhibits adequate protection parameters. However, adverse","page_number":191,"box":{"x":68,"y":530,"width":798,"height":11}},{"id":"b2fc1012-d58f-46ee-bdf6-d87b233ed007","block_type":"box","text":"economic conditions or changing circumstances are more likely to weaken an obligor’s capacity to","page_number":191,"box":{"x":196,"y":545,"width":699,"height":11}},{"id":"4ccc5ab1-46dc-4e88-9b63-991e1edb0b6e","block_type":"box","text":"meet its financial commitments on the obligation.","page_number":191,"box":{"x":197,"y":560,"width":351,"height":11}},{"id":"8b040401-7d08-4d08-9b7c-80df71c5f61b","block_type":"box","text":"B A shor t-term obligation rated ‘B’ is regarded as vulnerable and has significant speculative","page_number":191,"box":{"x":70,"y":580,"width":765,"height":11}},{"id":"2d58acc6-8d9e-44f1-9833-7820b31b5e10","block_type":"box","text":"characteristics. The obligor currently has the capacity to meet its financial commitments; however,","page_number":191,"box":{"x":196,"y":595,"width":700,"height":11}},{"id":"b4ab5718-2a0f-4375-a6d8-4aa92bd8b1b2","block_type":"box","text":"it faces major ongoing uncer tainties that could lead to the obligor’s inadequate capacity to meet its","page_number":191,"box":{"x":197,"y":610,"width":708,"height":12}},{"id":"57c97ab9-590c-46d9-9aaf-59d50d7ec53e","block_type":"box","text":"financial commitments.","page_number":191,"box":{"x":196,"y":625,"width":165,"height":9}},{"id":"f00ef5f0-a7b3-436c-b881-36389c3dc212","block_type":"box","text":"C A shor t-term obligation rated ‘C’ is currently vulnerable to nonpayment and is dependent upon","page_number":191,"box":{"x":69,"y":646,"width":796,"height":11}},{"id":"ea2eb412-51cd-4c94-8ce3-f0f3d3d83f20","block_type":"box","text":"favorable business, financial, and economic conditions for the obligor to meet its financial","page_number":191,"box":{"x":196,"y":661,"width":641,"height":11}},{"id":"4aed2d6c-f9fb-4ace-a3c0-7abfb12b91dd","block_type":"box","text":"commitments on the obligation.","page_number":191,"box":{"x":196,"y":676,"width":224,"height":11}},{"id":"1e837ca8-5802-41d1-8552-1d869a7fa20a","block_type":"box","text":"D A shor t-term obligation rated ‘D’ is in default or in breach of an imputed promise. For non-hybrid","page_number":191,"box":{"x":70,"y":696,"width":808,"height":11}},{"id":"82ea9648-1aed-4b70-81e0-fd8137faa1cc","block_type":"box","text":"capital instruments, the ‘D’ rating category is used when payments on an obligation are not made","page_number":191,"box":{"x":196,"y":711,"width":698,"height":11}},{"id":"0e0db9e9-e028-4f60-a996-47d9d7005071","block_type":"box","text":"on the date due, unless S&P believes that such payments will be made within any stated grace","page_number":191,"box":{"x":196,"y":726,"width":678,"height":12}},{"id":"ba489c5c-83b9-4806-94cf-3516e67b6eb6","block_type":"box","text":"period. However, any stated grace period longer than five business days will be treated as five","page_number":191,"box":{"x":197,"y":741,"width":669,"height":12}},{"id":"2789e5ff-495b-4d92-8368-3ad07c3629bc","block_type":"box","text":"business days. The ‘D’ rating also will be used upon the filing of a bankruptcy petition or the taking","page_number":191,"box":{"x":196,"y":756,"width":707,"height":12}},{"id":"89cf0fce-bb39-4062-b7a7-817c6fbd7d7a","block_type":"box","text":"of a similar action and where default on an obligation is a vir tual cer tainty, for example due to","page_number":191,"box":{"x":196,"y":772,"width":669,"height":11}},{"id":"d0b753be-b6b1-487c-9b2e-85796a8af918","block_type":"box","text":"automatic stay provisions. A rating on an obligation is lowered to ‘D’ if it is subject to a distressed","page_number":191,"box":{"x":196,"y":787,"width":700,"height":11}},{"id":"e6a699f6-6331-4b7b-a44d-163adb927697","block_type":"box","text":"debt restructuring.","page_number":191,"box":{"x":196,"y":802,"width":130,"height":11}},{"id":"551b95b4-5762-4258-8f76-53f484f7fc13","block_type":"box","text":"Description of S&P’s Municipal Short-Term Note Ratings","page_number":191,"box":{"x":69,"y":830,"width":411,"height":11}},{"id":"c4ba9671-1113-4d58-a600-92c835ce1d88","block_type":"box","text":"An S&P U.S. municipal note rating reflects S&P’s opinion about the liquidity factors and market access risks","page_number":191,"box":{"x":101,"y":852,"width":772,"height":11}},{"id":"4ae4605f-f288-4ba9-91b0-5647035a8abd","block_type":"box","text":"unique to the notes. Notes due in three years or less will likely receive a note rating. Notes with an original maturity","page_number":191,"box":{"x":69,"y":868,"width":823,"height":11}},{"id":"162d9bc7-3726-46f3-91d4-94ff96cdd2b8","block_type":"box","text":"of more than three years will most likely receive a long-term debt rating. In determining which type of rating, if any, to","page_number":191,"box":{"x":69,"y":882,"width":832,"height":12}},{"id":"4f4f9450-7779-4a54-b4d8-3ca1da96c4b4","block_type":"box","text":"assign, S&P’s analysis will review the following considerations:","page_number":191,"box":{"x":69,"y":898,"width":447,"height":11}},{"id":"746a5dfe-bdb2-4d15-b27b-65b6fac782b0","block_type":"box","text":"A-5","page_number":191,"box":{"x":477,"y":943,"width":24,"height":9}},{"id":"f561e6a0-f7b0-4538-8946-79f4c9b3ce76","block_type":"box","text":"NM1026U-6033063-191/246","page_number":191,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"0fee2b42-ea65-4b2b-8d1a-a1ded078893d","block_type":"box","text":"•","page_number":192,"box":{"x":69,"y":48,"width":6,"height":4}},{"id":"5041b3d0-61b9-4e11-9afc-be873dcfcb95","block_type":"box","text":"Amor tization schedule—the larger the final maturity relative to other maturities, the more likely it will be treated","page_number":192,"box":{"x":101,"y":45,"width":796,"height":11}},{"id":"8e4b5c77-42d6-4533-bce5-4a4bac3fbb84","block_type":"box","text":"as a note; and","page_number":192,"box":{"x":102,"y":60,"width":101,"height":10}},{"id":"adf98d78-8da5-4e34-a319-5232b71642c1","block_type":"box","text":"•","page_number":192,"box":{"x":69,"y":83,"width":6,"height":4}},{"id":"09609d5d-cc16-437a-bd78-98d31b8cd5e2","block_type":"box","text":"Source of payment—the more dependent the issue is on the market for its refinancing, the more likely it will be","page_number":192,"box":{"x":102,"y":80,"width":794,"height":11}},{"id":"8b103a83-f874-4dd6-8b91-f8c12e558f56","block_type":"box","text":"treated as a note.","page_number":192,"box":{"x":101,"y":95,"width":127,"height":9}},{"id":"b93cf8c8-461c-4bc5-9c2a-2d510ab5cd71","block_type":"box","text":"S&P’s municipal shor t-term note rating symbols are as follows:","page_number":192,"box":{"x":102,"y":118,"width":448,"height":11}},{"id":"949c2cd3-c1bf-48f4-a924-c47eb0e36045","block_type":"box","text":"SP-1 Strong capacity to pay principal and interest. An issue determined to possess a very strong","page_number":192,"box":{"x":69,"y":146,"width":779,"height":11}},{"id":"88cceb05-9854-4f1a-99cf-d03df090f840","block_type":"box","text":"capacity to pay debt service is given a plus (+) designation.","page_number":192,"box":{"x":196,"y":161,"width":422,"height":11}},{"id":"16fdb07d-7cfb-4928-9429-06ed591efea1","block_type":"box","text":"SP-2 Satisfactory capacity to pay principal and interest, with some vulnerability to adverse financial and","page_number":192,"box":{"x":69,"y":181,"width":825,"height":11}},{"id":"8a48a573-e42b-4f47-b76e-37fce3c6b49d","block_type":"box","text":"economic changes over the term of the notes.","page_number":192,"box":{"x":196,"y":196,"width":327,"height":11}},{"id":"2ad544df-4e2a-4a6a-80bc-4d2e36e4e7b1","block_type":"box","text":"SP-3 Speculative capacity to pay principal and interest.","page_number":192,"box":{"x":69,"y":216,"width":479,"height":11}},{"id":"7cf100d7-555f-41bc-a32d-95964d627bb4","block_type":"box","text":"D ‘D’ is assigned upon failure to pay the note when due, completion of a distressed debt","page_number":192,"box":{"x":70,"y":236,"width":745,"height":11}},{"id":"4019d6e8-421f-4c59-8efd-c14d396ce68a","block_type":"box","text":"restructuring, or the filing of a bankruptcy petition or the taking of similar action and where default","page_number":192,"box":{"x":197,"y":251,"width":699,"height":12}},{"id":"6d5d56f6-ecba-4417-bb8e-115cbb8c3e66","block_type":"box","text":"on an obligation is a vir tual cer tainty, for example due to automatic stay provisions.","page_number":192,"box":{"x":196,"y":266,"width":594,"height":12}},{"id":"ec93cd60-d5f4-468e-b920-37e9bba104dc","block_type":"box","text":"Description of Fitch Ratings’ (“Fitch’s”) Credit Ratings Scales","page_number":192,"box":{"x":69,"y":294,"width":455,"height":11}},{"id":"41b56b2f-35c1-4289-99b9-364b6848e8a8","block_type":"box","text":"Fitch Ratings publishes opinions on a variety of scales. The most common of these are credit ratings, but the","page_number":192,"box":{"x":102,"y":317,"width":778,"height":11}},{"id":"fa08c1fe-d4ff-45e4-b141-38ed657983cf","block_type":"box","text":"agency also publishes ratings, scores and other relative opinions relating to financial or operational strength. For","page_number":192,"box":{"x":69,"y":332,"width":804,"height":11}},{"id":"ed0f08b8-4b9e-4889-b14b-a7c26ff3df4a","block_type":"box","text":"example, Fitch also provides specialized ratings of servicers of residential and commercial mor tgages, asset","page_number":192,"box":{"x":69,"y":347,"width":776,"height":11}},{"id":"25ad5652-b058-4233-a8c5-58bad9092b94","block_type":"box","text":"managers and funds. In each case, users should refer to the definitions of each individual scale for guidance on the","page_number":192,"box":{"x":69,"y":362,"width":827,"height":11}},{"id":"bd2d9d77-b6e5-4c58-b4ad-932dffc02cd8","block_type":"box","text":"dimensions of risk covered in each assessment.","page_number":192,"box":{"x":69,"y":377,"width":344,"height":9}},{"id":"7b57273b-6a69-4463-8b02-3282098d7cd2","block_type":"box","text":"Fitch’s credit ratings relating to issuers are an opinion on the relative ability of an entity to meet financial","page_number":192,"box":{"x":102,"y":400,"width":747,"height":11}},{"id":"976f73e6-d9e5-4769-8132-f7b2b275017d","block_type":"box","text":"commitments, such as interest, preferred dividends, repayment of principal, insurance claims or counterpar ty","page_number":192,"box":{"x":69,"y":415,"width":782,"height":11}},{"id":"d05afbf8-bcae-4394-981d-05da3ffe28a5","block_type":"box","text":"obligations. Credit ratings relating to securities and obligations of an issuer can include a recovery expectation.","page_number":192,"box":{"x":69,"y":430,"width":793,"height":11}},{"id":"8cbb1b4d-a45f-4fee-af0a-15894524d007","block_type":"box","text":"Credit ratings are used by investors as indications of the likelihood of receiving the money owed to them in","page_number":192,"box":{"x":69,"y":445,"width":761,"height":12}},{"id":"47458421-3ad1-4fbb-aa3c-88571b7b50ee","block_type":"box","text":"accordance with the terms on which they invested. The agency’s credit ratings cover the global spectrum of","page_number":192,"box":{"x":69,"y":460,"width":766,"height":12}},{"id":"330a5eb9-3346-426e-8ba7-ec5155113d00","block_type":"box","text":"corporate, sovereign financial, bank, insurance, and public finance entities (including supranational and sub-national","page_number":192,"box":{"x":69,"y":475,"width":827,"height":12}},{"id":"57a0639d-9e93-4f2f-aa3b-82d92731127e","block_type":"box","text":"entities) and the securities or other obligations they issue, as well as structured finance securities backed by","page_number":192,"box":{"x":69,"y":491,"width":779,"height":11}},{"id":"d49756fe-0ae6-46fe-a102-270f759c59cf","block_type":"box","text":"receivables or other financial assets.","page_number":192,"box":{"x":69,"y":506,"width":262,"height":9}},{"id":"a4850eba-ff2f-4912-9e08-abe2683e4c0e","block_type":"box","text":"The terms “investment grade” and “speculative grade” have established themselves over time as shor thand to","page_number":192,"box":{"x":101,"y":529,"width":794,"height":11}},{"id":"9b788edd-9d7a-4470-97ea-01500e869420","block_type":"box","text":"describe the categories ‘AAA’ to ‘BBB’ (investment grade) and ‘BB’ to ‘D’ (speculative grade). The terms investment","page_number":192,"box":{"x":69,"y":544,"width":826,"height":11}},{"id":"11165e49-73c8-4c60-a416-b5e9bb5cc8a6","block_type":"box","text":"grade and speculative grade are market conventions and do not imply any recommendation or endorsement of a","page_number":192,"box":{"x":68,"y":559,"width":800,"height":11}},{"id":"889c1a89-1aa9-4d20-be38-c96b5707c84d","block_type":"box","text":"specific security for investment purposes. Investment grade categories indicate relatively low to moderate credit risk,","page_number":192,"box":{"x":69,"y":574,"width":832,"height":11}},{"id":"12821df5-82db-4bb0-bb6d-d0de7135973f","block_type":"box","text":"while ratings in the speculative categories either signal a higher level of credit risk or that a default has already","page_number":192,"box":{"x":68,"y":589,"width":793,"height":11}},{"id":"406600bc-2fbc-4bdd-87b1-40ea7d4898ae","block_type":"box","text":"occurred.","page_number":192,"box":{"x":69,"y":604,"width":65,"height":9}},{"id":"b28dbbdf-5b15-4675-a851-22c9097577af","block_type":"box","text":"For the convenience of investors, Fitch may also include issues relating to a rated issuer that are not and have","page_number":192,"box":{"x":102,"y":627,"width":788,"height":11}},{"id":"834a6b10-6440-4c1b-952e-4f280079df2a","block_type":"box","text":"not been rated on its web page. Such issues are also denoted as ‘NR’.","page_number":192,"box":{"x":69,"y":642,"width":506,"height":11}},{"id":"b6b1ca45-2730-4ab3-a774-0b88d389d0ca","block_type":"box","text":"Credit ratings express risk in relative rank order, which is to say they are ordinal measures of credit risk and are","page_number":192,"box":{"x":102,"y":664,"width":797,"height":12}},{"id":"904c6087-1bb2-4d25-bed7-4bd75a06cef5","block_type":"box","text":"not predictive of a specific frequency of default or loss. For information about the historical per formance of ratings","page_number":192,"box":{"x":69,"y":680,"width":815,"height":11}},{"id":"44db2ef3-a7ab-44bd-ac5d-340bcb4a13ee","block_type":"box","text":"please refer to Fitch’s Ratings Transition and Default studies which detail the historical default rates and their","page_number":192,"box":{"x":70,"y":695,"width":783,"height":11}},{"id":"5a85f9a7-8b52-455c-9258-d74f9688d8e5","block_type":"box","text":"meaning. The European Securities and Markets Authority also maintains a central repository of historical default","page_number":192,"box":{"x":69,"y":710,"width":801,"height":11}},{"id":"441ea9e3-0af1-459f-b4ea-34a652fc972a","block_type":"box","text":"rates.","page_number":192,"box":{"x":69,"y":726,"width":39,"height":8}},{"id":"b9653d32-6c2e-47b8-adf2-ebfd4c8a6b23","block_type":"box","text":"Fitch’s credit ratings do not directly address any risk other than credit risk. In par ticular, ratings do not deal with","page_number":192,"box":{"x":102,"y":748,"width":798,"height":11}},{"id":"06fc9fa9-0fa5-4310-9492-7bbee255127e","block_type":"box","text":"the risk of a market value loss on a rated security due to changes in interest rates, liquidity and other market","page_number":192,"box":{"x":68,"y":763,"width":780,"height":11}},{"id":"a414f175-1ee9-4fef-ba78-2e011c7fdbeb","block_type":"box","text":"considerations. However, in terms of payment obligation on the rated liability, market risk may be considered to the","page_number":192,"box":{"x":69,"y":778,"width":821,"height":11}},{"id":"95742838-705e-4398-ac5b-d31a4974feed","block_type":"box","text":"extent that it influences the ability of an issuer to pay upon a commitment.","page_number":192,"box":{"x":69,"y":793,"width":531,"height":11}},{"id":"5a1db34b-0170-4a6b-a1b3-6bc28d2eb75d","block_type":"box","text":"Ratings nonetheless do not reflect market risk to the extent that they influence the size or other conditionality of","page_number":192,"box":{"x":102,"y":816,"width":801,"height":11}},{"id":"9da64749-1a18-4e8d-933c-dee0e042137c","block_type":"box","text":"the obligation to pay upon a commitment (for example, in the case of index-linked bonds).","page_number":192,"box":{"x":68,"y":831,"width":639,"height":11}},{"id":"818152d2-4559-45ec-a7b2-12bb3b889248","block_type":"box","text":"In the default components of ratings assigned to individual obligations or instruments, the agency typically rates","page_number":192,"box":{"x":102,"y":853,"width":799,"height":12}},{"id":"e41243f2-56c1-4c1a-9b23-9e86a8e703bc","block_type":"box","text":"to the likelihood of non-payment or default in accordance with the terms of that instrument’s documentation. In","page_number":192,"box":{"x":68,"y":869,"width":794,"height":11}},{"id":"c0a753ac-3158-40ab-9027-5a38f444697d","block_type":"box","text":"limited cases, Fitch may include additional considerations (","page_number":192,"box":{"x":70,"y":884,"width":420,"height":11}},{"id":"377b2334-4897-4424-897f-a4ebec05f90b","block_type":"box","text":"i.e.","page_number":192,"box":{"x":492,"y":884,"width":20,"height":9}},{"id":"84641146-eef7-4849-8e10-84d0ce3f9771","block_type":"box","text":"rate to a higher or lower standard than that implied in","page_number":192,"box":{"x":519,"y":884,"width":380,"height":11}},{"id":"2e96951b-817b-40f1-ade8-210302ce9b32","block_type":"box","text":"the obligation’s documentation).","page_number":192,"box":{"x":68,"y":899,"width":230,"height":11}},{"id":"74337b13-91ae-4a2a-b0b4-e77faa799283","block_type":"box","text":"A-6","page_number":192,"box":{"x":477,"y":943,"width":23,"height":9}},{"id":"20dd2bf6-5497-4c21-9a3c-4d5da5face38","block_type":"box","text":"NM1026U-6033063-192/246","page_number":192,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"9deb188e-a85c-4cd1-8987-fd63dc64f0b1","block_type":"box","text":"The primary credit rating scales can be used to provide a rating of privately issued obligations or cer tain note","page_number":193,"box":{"x":101,"y":45,"width":779,"height":11}},{"id":"a4883ec0-08a3-4dd5-9fcc-f23459c24ac4","block_type":"box","text":"issuance programs or for private ratings. In this case the rating is not published, but only provided to the issuer or its","page_number":193,"box":{"x":70,"y":60,"width":835,"height":11}},{"id":"f54b6a78-ac76-4530-abab-cce3017cf19c","block_type":"box","text":"agents in the form of a rating letter.","page_number":193,"box":{"x":69,"y":75,"width":253,"height":11}},{"id":"d2201573-007d-4c32-97a3-a8bcf39970d5","block_type":"box","text":"The primary credit rating scales may also be used to provide ratings for a more narrow scope, including interest","page_number":193,"box":{"x":101,"y":98,"width":797,"height":11}},{"id":"4f99c73f-b03e-48c3-9a47-6de19532d90f","block_type":"box","text":"strips and return of principal or in other forms of opinions such as credit opinions or rating assessment services.","page_number":193,"box":{"x":69,"y":113,"width":806,"height":11}},{"id":"1694a2e0-a095-43d2-8cd1-3632afa07af0","block_type":"box","text":"Credit opinions are either a notch- or category-specific view using the primary rating scale and omit one or more","page_number":193,"box":{"x":69,"y":128,"width":796,"height":11}},{"id":"d536aa8b-f248-4190-bfc3-26ef2b576939","block_type":"box","text":"characteristics of a full rating or meet them to a different standard. Credit opinions will be indicated using a lower","page_number":193,"box":{"x":69,"y":143,"width":811,"height":11}},{"id":"b797179a-5034-4fa6-a40d-153a4f41d577","block_type":"box","text":"case letter symbol combined with either an ‘*’ (","page_number":193,"box":{"x":69,"y":158,"width":340,"height":11}},{"id":"f107b28a-10dc-4be1-9ce1-e9802c0c7f09","block_type":"box","text":"e.g.","page_number":193,"box":{"x":410,"y":160,"width":25,"height":9}},{"id":"8bcefa2f-eed6-437b-a7a2-e5e3b61d6389","block_type":"box","text":"‘bbb+*’) or (cat) suffix to denote the opinion status. Credit","page_number":193,"box":{"x":443,"y":158,"width":418,"height":11}},{"id":"9253ea3f-dd1b-4bbf-9913-1a9a2624b64d","block_type":"box","text":"opinions will be point-in-time typically but may be monitored if the analytical group believes information will be","page_number":193,"box":{"x":69,"y":173,"width":780,"height":11}},{"id":"a61f56b4-95e4-40f7-b5f0-313461f8f008","block_type":"box","text":"sufficiently available. Rating assessment services are a notch-specific view using the primary rating scale of how an","page_number":193,"box":{"x":69,"y":188,"width":827,"height":12}},{"id":"5075f7d0-7fca-4699-b3e6-422c58622bda","block_type":"box","text":"existing or potential rating may be changed by a given set of hypothetical circumstances. While credit opinions and","page_number":193,"box":{"x":69,"y":203,"width":816,"height":12}},{"id":"c1c5b7bb-6354-44c9-8152-3c5db4195519","block_type":"box","text":"rating assessment services are point-in-time and are not monitored, they may have a directional watch or outlook","page_number":193,"box":{"x":69,"y":219,"width":808,"height":11}},{"id":"bb92d9e4-4d87-487a-8925-bc643114bee4","block_type":"box","text":"assigned, which can signify the trajectory of the credit profile.","page_number":193,"box":{"x":69,"y":234,"width":437,"height":11}},{"id":"2f0c411b-0afd-4880-b62d-6c6c75acb55c","block_type":"box","text":"Description of Fitch’s Long-Term Corporate Finance Obligations Rating Scales","page_number":193,"box":{"x":69,"y":264,"width":567,"height":11}},{"id":"8deea2a5-bd82-4307-ad66-749ccc13b950","block_type":"box","text":"Ratings of individual securities or financial obligations of a corporate issuer address relative vulnerability to","page_number":193,"box":{"x":102,"y":286,"width":763,"height":12}},{"id":"8cb8266c-198c-44c5-a17e-54c46b679ef4","block_type":"box","text":"default on an ordinal scale. In addition, for financial obligations in corporate finance, a measure of recovery given","page_number":193,"box":{"x":69,"y":302,"width":807,"height":11}},{"id":"87360a56-4a2d-4627-b175-34cf1070c387","block_type":"box","text":"default on that liability is also included in the rating assessment. This notably applies to covered bonds ratings, which","page_number":193,"box":{"x":69,"y":317,"width":840,"height":11}},{"id":"d258a4c1-f411-49f8-bd63-04e7fe66c75a","block_type":"box","text":"incorporate both an indication of the probability of default and of the recovery given a default of this debt instrument.","page_number":193,"box":{"x":70,"y":332,"width":833,"height":11}},{"id":"2819a779-6310-425f-b2a1-4792ba6c68e5","block_type":"box","text":"On the contrary, Ratings of debtor-in-possession (“DIP”) obligations incorporate the expectation of full repayment.","page_number":193,"box":{"x":69,"y":347,"width":807,"height":11}},{"id":"aa0f6ec2-837b-4956-9206-e5433da56bd0","block_type":"box","text":"The relationship between the issuer scale and obligation scale assumes a generic historical average recovery.","page_number":193,"box":{"x":101,"y":370,"width":784,"height":11}},{"id":"35ca3284-c033-432b-a3cb-73c7425afafc","block_type":"box","text":"Individual obligations can be assigned ratings higher, lower, or the same as that entity’s issuer rating or issuer","page_number":193,"box":{"x":70,"y":385,"width":787,"height":11}},{"id":"0b7efd45-d263-4608-aa00-fb29d9aa70aa","block_type":"box","text":"default rating (“IDR”), based on their relative ranking, relative vulnerability to default or based on explicit Recovery","page_number":193,"box":{"x":69,"y":400,"width":813,"height":11}},{"id":"3882ce77-7980-4585-8e3b-4d8176620efc","block_type":"box","text":"Ratings.","page_number":193,"box":{"x":70,"y":415,"width":55,"height":11}},{"id":"e44e4151-b28f-44af-b9ff-95f7bdedf9f6","block_type":"box","text":"As a result, individual obligations of entities, such as corporations, are assigned ratings higher, lower, or the","page_number":193,"box":{"x":101,"y":438,"width":772,"height":11}},{"id":"764afb0d-754e-44a6-ad1a-e8a6e52fc5f5","block_type":"box","text":"same as that entity’s issuer rating or IDR, except DIP obligation ratings that are not based off an IDR. At the lower","page_number":193,"box":{"x":69,"y":453,"width":815,"height":11}},{"id":"13790add-16dd-4c67-bc85-82d8de38f7f6","block_type":"box","text":"end of the ratings scale, Fitch publishes explicit Recovery Ratings in many cases to complement issuer and","page_number":193,"box":{"x":69,"y":468,"width":766,"height":11}},{"id":"59486551-0934-42b9-af2e-b107a988c1cc","block_type":"box","text":"obligation ratings.","page_number":193,"box":{"x":69,"y":483,"width":125,"height":11}},{"id":"d2770c0e-44e4-470c-8662-399dca0f8c18","block_type":"box","text":"Fitch long-term obligations rating scales are as follows:","page_number":193,"box":{"x":102,"y":506,"width":390,"height":11}},{"id":"b05705e0-2b31-487f-af22-09ad65d77bb1","block_type":"box","text":"AAA Highest Credit Quality. ‘AAA’ ratings denote the lowest expectation of credit risk. They are assigned","page_number":193,"box":{"x":68,"y":533,"width":833,"height":12}},{"id":"54bd49c3-9ccb-4772-89fe-00a65632baae","block_type":"box","text":"only in cases of exceptionally strong capacity for payment of financial commitments. This capacity","page_number":193,"box":{"x":196,"y":549,"width":697,"height":11}},{"id":"65a2cebf-ee2d-4d26-9646-48614221e1f1","block_type":"box","text":"is highly unlikely to be adversely affected by foreseeable events.","page_number":193,"box":{"x":197,"y":564,"width":457,"height":11}},{"id":"d9ba23c0-3812-4f0a-b433-031bcf951503","block_type":"box","text":"AA Very High Credit Quality. ‘AA’ ratings denote expectations of very low credit risk. They indicate very","page_number":193,"box":{"x":68,"y":584,"width":829,"height":11}},{"id":"dfd6ef10-1966-4f77-a904-b351f4bbcb1a","block_type":"box","text":"strong capacity for payment of financial commitments. This capacity is not significantly vulnerable","page_number":193,"box":{"x":196,"y":599,"width":694,"height":11}},{"id":"c2816064-0b6f-47e9-b012-acd069559140","block_type":"box","text":"to foreseeable events.","page_number":193,"box":{"x":195,"y":614,"width":159,"height":9}},{"id":"cddd8ad5-f0b0-4cb2-8f32-df41c2ccbf59","block_type":"box","text":"A High Credit Quality. ‘A’ ratings denote expectations of low credit risk. The capacity for payment of","page_number":193,"box":{"x":68,"y":634,"width":819,"height":12}},{"id":"e8818782-1d16-4c98-b443-faa8daef5710","block_type":"box","text":"financial commitments is considered strong. This capacity may, never theless, be more vulnerable","page_number":193,"box":{"x":196,"y":649,"width":695,"height":12}},{"id":"af31bc38-4713-4ccf-8c3d-c514fb6c6e60","block_type":"box","text":"to adverse business or economic conditions than is the case for higher ratings.","page_number":193,"box":{"x":195,"y":664,"width":565,"height":12}},{"id":"c4545def-5796-47f9-9eef-af82f0fd2bf3","block_type":"box","text":"BBB Good Credit Quality. ‘BBB’ ratings indicate that expectations of credit risk are currently low. The","page_number":193,"box":{"x":70,"y":685,"width":805,"height":11}},{"id":"829f1307-183c-42a8-8243-8905f2874ff6","block_type":"box","text":"capacity for payment of financial commitments is considered adequate, but adverse business or","page_number":193,"box":{"x":196,"y":700,"width":686,"height":11}},{"id":"48d47fe7-d19e-4b8f-8d0b-aa8cd4186fa3","block_type":"box","text":"economic conditions are more likely to impair this capacity.","page_number":193,"box":{"x":196,"y":715,"width":420,"height":11}},{"id":"4e5d0f99-dee1-435b-b1c0-dd32cba41214","block_type":"box","text":"BB Speculative. ‘BB’ ratings indicate an elevated vulnerability to credit risk, par ticularly in the event of","page_number":193,"box":{"x":70,"y":735,"width":830,"height":11}},{"id":"9c13d605-a316-4241-bf1a-900f5f8779ef","block_type":"box","text":"adverse changes in business or economic conditions over time; however, business or financial","page_number":193,"box":{"x":196,"y":750,"width":672,"height":11}},{"id":"2bc7aaf1-e29f-404b-bceb-a2e5e113096c","block_type":"box","text":"alternatives may be available to allow financial commitments to be met.","page_number":193,"box":{"x":196,"y":765,"width":511,"height":11}},{"id":"26adf693-f313-47c0-9ff6-8af3813437ee","block_type":"box","text":"B Highly Speculative. ‘B’ ratings indicate that material credit risk is present.","page_number":193,"box":{"x":70,"y":786,"width":650,"height":11}},{"id":"70168817-9655-430f-962f-61e90e081027","block_type":"box","text":"CCC Substantial Credit Risk. ‘CCC’ ratings indicate that substantial credit risk is present.","page_number":193,"box":{"x":69,"y":806,"width":727,"height":11}},{"id":"d15fac2f-77bc-4486-a274-9f7d071c04a6","block_type":"box","text":"CC Very High Levels of Credit Risk. ‘CC’ ratings indicate very high levels of credit risk.","page_number":193,"box":{"x":69,"y":826,"width":712,"height":11}},{"id":"7c4df0c5-2ebc-4d39-82ea-fb345cce8b92","block_type":"box","text":"C Exceptionally High Levels of Credit Risk. ‘C’ indicates exceptionally high levels of credit risk.","page_number":193,"box":{"x":69,"y":846,"width":780,"height":11}},{"id":"72df174a-593b-49af-865b-dbfdf22d1d05","block_type":"box","text":"Within rating categories, Fitch may use modifiers. The modifiers “+” or “-” may be appended to a rating to denote","page_number":193,"box":{"x":101,"y":866,"width":808,"height":11}},{"id":"4116915f-aca7-4d59-9f24-607383a9221b","block_type":"box","text":"relative status within major rating categories.","page_number":193,"box":{"x":69,"y":881,"width":320,"height":11}},{"id":"5f7571d1-c081-4706-9ff6-196f955013be","block_type":"box","text":"A-7","page_number":193,"box":{"x":477,"y":943,"width":23,"height":9}},{"id":"41c91040-b105-4a44-aff3-55f253e000af","block_type":"box","text":"NM1026U-6033063-193/246","page_number":193,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"f898e062-c1d7-4e0a-b874-830f9a5a0a5f","block_type":"box","text":"For example, the rating category ‘AA’ has three notch-specific rating levels (‘AA+’; ‘AA’; ‘AA–’; each a rating","page_number":194,"box":{"x":102,"y":45,"width":761,"height":11}},{"id":"df2c99ee-fd24-4a93-be67-b65832af06c0","block_type":"box","text":"level). Such suffixes are not added to ‘AAA’ ratings and ratings below the ‘CCC’ category. For the shor t-term rating","page_number":194,"box":{"x":70,"y":60,"width":813,"height":11}},{"id":"72e557f7-d037-455c-ab72-e93eb2f95f32","block_type":"box","text":"category of ‘F1’, a ‘+’ may be appended.","page_number":194,"box":{"x":69,"y":75,"width":289,"height":11}},{"id":"ea5551ee-04fd-4ded-9a18-c467d1507492","block_type":"box","text":"Description of Fitch’s Short-Term Ratings Assigned to Issuers and Obligations","page_number":194,"box":{"x":69,"y":105,"width":568,"height":11}},{"id":"f52314af-1f30-427d-b49b-d0e2d18d426b","block_type":"box","text":"A shor t-term issuer or obligation rating is based in all cases on the shor t-term vulnerability to default of the rated","page_number":194,"box":{"x":101,"y":128,"width":806,"height":11}},{"id":"55d324d0-8cf1-4b2b-88b3-052ab91c3a21","block_type":"box","text":"entity and relates to the capacity to meet financial obligations in accordance with the documentation governing the","page_number":194,"box":{"x":69,"y":143,"width":817,"height":11}},{"id":"331178ca-12fe-4356-9f2a-a96bd9837d63","block_type":"box","text":"relevant obligation. Shor t-term deposit ratings may be adjusted for loss severity. Shor t-term ratings are assigned to","page_number":194,"box":{"x":69,"y":158,"width":822,"height":11}},{"id":"78776a10-d383-4ac8-94a6-456900c375d1","block_type":"box","text":"obligations whose initial maturity is viewed as “shor t term” based on market convention. Typically, this means up to","page_number":194,"box":{"x":69,"y":173,"width":827,"height":11}},{"id":"5f43ae56-1c11-4a48-b7ad-e9e10d9e1b25","block_type":"box","text":"13 months for corporate, sovereign, and structured obligations and up to 36 months for obligations in U.S. public","page_number":194,"box":{"x":70,"y":188,"width":808,"height":12}},{"id":"1449c31d-71b2-4bf4-b79a-7f155e542dd1","block_type":"box","text":"finance markets.","page_number":194,"box":{"x":68,"y":203,"width":118,"height":9}},{"id":"aee14100-5ba5-44c8-b3f2-a9e9b8bcb4bf","block_type":"box","text":"Fitch shor t-term ratings are as follows:","page_number":194,"box":{"x":102,"y":226,"width":273,"height":11}},{"id":"9e6c7b5a-6e7d-40be-a4e2-6a782f09fb65","block_type":"box","text":"F1 Highest Shor t-Term Credit Quality. Indicates the strongest intrinsic capacity for timely payment of","page_number":194,"box":{"x":70,"y":254,"width":816,"height":11}},{"id":"daedc079-22f9-4830-97d2-2a61dab2bbc4","block_type":"box","text":"financial commitments; may have an added “+” to denote any exceptionally strong credit feature.","page_number":194,"box":{"x":196,"y":269,"width":692,"height":11}},{"id":"43b11c53-7ce5-47a3-8f86-7cc6ebdd62a2","block_type":"box","text":"F2 Good Shor t-Term Credit Quality. Good intrinsic capacity for timely payment of financial","page_number":194,"box":{"x":70,"y":289,"width":734,"height":11}},{"id":"22264c5c-793a-4557-ade6-d3fe4340182e","block_type":"box","text":"commitments.","page_number":194,"box":{"x":196,"y":304,"width":100,"height":9}},{"id":"aa264c23-4e05-4a5e-98b9-682b59b2a756","block_type":"box","text":"F3 Fair Shor t-Term Credit Quality. The intrinsic capacity for timely payment of financial commitments is","page_number":194,"box":{"x":70,"y":324,"width":831,"height":11}},{"id":"fd787b91-eafe-45b7-8e36-3cecbc3485bf","block_type":"box","text":"adequate.","page_number":194,"box":{"x":196,"y":340,"width":70,"height":10}},{"id":"0fcdd785-ff58-4633-8839-be2abf6a9d4e","block_type":"box","text":"B Speculative Shor t-Term Credit Quality. Minimal capacity for timely payment of financial","page_number":194,"box":{"x":70,"y":360,"width":737,"height":11}},{"id":"d6bc3fae-d44a-4567-af79-5c8cfb53144d","block_type":"box","text":"commitments, plus heightened vulnerability to near term adverse changes in financial and","page_number":194,"box":{"x":196,"y":375,"width":641,"height":11}},{"id":"2ce82bfa-5db2-4a5c-ad88-23be7c1891d7","block_type":"box","text":"economic conditions.","page_number":194,"box":{"x":196,"y":390,"width":149,"height":9}},{"id":"25461a96-83e2-418f-9f80-4668593c3256","block_type":"box","text":"C High Shor t-Term Default Risk. Default is a real possibility.","page_number":194,"box":{"x":69,"y":410,"width":535,"height":11}},{"id":"18c02463-a781-4d2a-87aa-be3290bfaf5a","block_type":"box","text":"RD Restricted Default. Indicates an entity that has defaulted on one or more of its financial","page_number":194,"box":{"x":70,"y":430,"width":749,"height":11}},{"id":"22057d45-8fd7-4ab6-8d32-aba158354430","block_type":"box","text":"commitments, although it continues to meet other financial obligations. Typically applicable to entity","page_number":194,"box":{"x":196,"y":445,"width":714,"height":12}},{"id":"6f12b840-1065-4408-817e-4b116347355c","block_type":"box","text":"ratings only.","page_number":194,"box":{"x":197,"y":461,"width":83,"height":11}},{"id":"3730dd5c-3010-453b-bff6-3711f0e2adfb","block_type":"box","text":"D Default. 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subject to the","page_number":195,"box":{"x":101,"y":408,"width":763,"height":11}},{"id":"e8e4ac7b-f599-4bcc-89c3-4b8581bf2d54","block_type":"box","text":"principles outlined in this Policy, as par t of BlackRock’s authority to manage, acquire and dispose of account","page_number":195,"box":{"x":102,"y":423,"width":775,"height":12}},{"id":"3bcb647d-6bb4-47e7-92ec-bb8d0668b2b4","block_type":"box","text":"assets, all as contemplated by the Funds’ respective investment management agreements.","page_number":195,"box":{"x":102,"y":439,"width":651,"height":11}},{"id":"d292eff4-a911-4110-a311-60d6a505ccea","block_type":"box","text":"BlackRock has adopted the BlackRock Active Investment Stewardship Global Engagement and Voting","page_number":195,"box":{"x":135,"y":461,"width":718,"height":11}},{"id":"67bcf0ee-7b6f-4308-af98-f68b584480de","block_type":"box","text":"Guidelines (as from time to time amended, the “Guidelines”) governing proxy voting by active and fixed 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The Guidelines include “climate and decarbonization” guidelines which","page_number":195,"box":{"x":102,"y":491,"width":766,"height":12}},{"id":"27672984-8fb1-4a37-bb51-ecf2121763ab","block_type":"box","text":"apply to the Funds listed in Appendix A, if any.","page_number":195,"box":{"x":102,"y":506,"width":325,"height":12}},{"id":"2a79b54a-d961-4e69-90ed-ff7da893765c","block_type":"box","text":"BlackRock will cast votes on behalf of each of the Funds covered by this policy on specific proxy issues in","page_number":195,"box":{"x":135,"y":529,"width":751,"height":11}},{"id":"f41acfee-5cb0-477e-82fd-5cb9272c56d3","block_type":"box","text":"respect of securities held by each such Fund (or may refrain from voting) in accordance with the Guidelines.","page_number":195,"box":{"x":102,"y":544,"width":765,"height":11}},{"id":"ee4210df-2836-4128-9799-ffd3fb9eeb17","block_type":"box","text":"Conflicts Management","page_number":195,"box":{"x":101,"y":567,"width":165,"height":11}},{"id":"17dfaca7-c174-405c-abd0-988f88856bdd","block_type":"box","text":"BlackRock Active Investment Stewardship (“BAIS”) maintains policies and procedures that seek to prevent","page_number":195,"box":{"x":135,"y":590,"width":758,"height":11}},{"id":"fc4a9df0-1f6e-4f37-b072-157bedccde2e","block_type":"box","text":"undue influence on BlackRock’s proxy voting activity and to mitigate material conflicts of interest in the exercise","page_number":195,"box":{"x":102,"y":605,"width":797,"height":11}},{"id":"fd57dd36-19eb-4ab0-900f-bacc1295113b","block_type":"box","text":"of proxy voting responsibilities. Potential material conflicts, and the resultant potential for undue influence, might","page_number":195,"box":{"x":102,"y":620,"width":805,"height":11}},{"id":"d0694ae1-482f-4425-a253-c0eea2fa3e0b","block_type":"box","text":"be due to a relationship between the investee company (or any shareholder proponent or dissident shareholder)","page_number":195,"box":{"x":102,"y":635,"width":797,"height":11}},{"id":"5c56372a-b16f-4cfe-b977-0ff3f0579279","block_type":"box","text":"and BlackRock, BlackRock’s affiliates or employees, or a Fund or a Fund’s affiliates. BlackRock has taken","page_number":195,"box":{"x":102,"y":650,"width":756,"height":11}},{"id":"149431ae-dcbe-4116-be0c-cd5319425c39","block_type":"box","text":"cer tain steps to mitigate potential conflicts, which are outlined in detail in the Guidelines. In mitigating conflicts,","page_number":195,"box":{"x":101,"y":665,"width":800,"height":11}},{"id":"efe386e8-5d9f-40d4-bede-6785e897b1fd","block_type":"box","text":"BAIS will adhere to the Guidelines.","page_number":195,"box":{"x":102,"y":680,"width":244,"height":9}},{"id":"42a6db15-6261-4816-a3f7-327b50c8e327","block_type":"box","text":"In cer tain instances, BAIS will engage an independent third-par ty voting service provider to make proxy","page_number":195,"box":{"x":135,"y":703,"width":731,"height":11}},{"id":"9a24c2b3-0e74-4396-99f6-3a68300c87fc","block_type":"box","text":"voting recommendations as a fur ther safeguard to avoid potential conflicts of interest, to satisfy regulatory","page_number":195,"box":{"x":101,"y":718,"width":763,"height":11}},{"id":"6ab6a3c3-7a3d-4a26-a58e-c40fec2f6fce","block_type":"box","text":"compliance requirements, or as may be otherwise required by applicable law.","page_number":195,"box":{"x":101,"y":733,"width":550,"height":11}},{"id":"10c407c0-abfc-4041-9089-7bbc2c666180","block_type":"box","text":"With respect to the relationship between securities lending and proxy voting, shares on loan cannot be voted","page_number":195,"box":{"x":134,"y":756,"width":774,"height":11}},{"id":"2f8e11e3-1c41-40d9-8333-1c17a908fc88","block_type":"box","text":"and BlackRock may determine to recall them for voting, as guided by BlackRock’s fiduciary responsibility to act","page_number":195,"box":{"x":102,"y":771,"width":791,"height":11}},{"id":"f362a2bb-2ffa-4a9e-8d05-2d7816a51d67","block_type":"box","text":"in clients’ financial interests. The Guidelines set for th BlackRock’s approach to recalling securities on loan in","page_number":195,"box":{"x":102,"y":786,"width":778,"height":11}},{"id":"98db9680-a855-4c0b-a356-8d05e56f712f","block_type":"box","text":"connection with proxy voting.","page_number":195,"box":{"x":101,"y":801,"width":203,"height":11}},{"id":"afef5ecb-642f-4af5-a9a4-c2f17d255fb1","block_type":"box","text":"Reports to the Board","page_number":195,"box":{"x":102,"y":824,"width":153,"height":11}},{"id":"2c3f39e2-9406-458f-bef5-f326c5ea0f9a","block_type":"box","text":"BlackRock will repor t on an annual basis to the Directors on (1) a summary of the proxy voting process as","page_number":195,"box":{"x":135,"y":846,"width":755,"height":12}},{"id":"675356b1-54b1-4c32-b942-50253df712cf","block_type":"box","text":"applicable to the Funds covered by this policy in the preceding year together with a representation that all 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. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14","page_number":198,"box":{"x":234,"y":330,"width":670,"height":9}},{"id":"3631f56d-219d-4695-8af1-4232c28bd232","block_type":"box","text":"CLIMATE AND DECARBONIZATION INVESTMENT OBJECTIVES","page_number":198,"box":{"x":74,"y":346,"width":448,"height":9}},{"id":"db7e038d-36b7-4006-bfd3-e51e4ad4d13c","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14","page_number":198,"box":{"x":528,"y":347,"width":376,"height":8}},{"id":"a3743b9e-707c-4c05-a79b-b43f9612008c","block_type":"box","text":"APPENDIX 1: HOW WE FULFILL AND OVERSEE OUR INVESTMENT STEWARDSHIP RESPONSIBILITIES FOR","page_number":198,"box":{"x":73,"y":363,"width":771,"height":9}},{"id":"2802002b-2188-42c2-a7eb-80855587f40c","block_type":"box","text":"NON-INDEX EQUITY INVESTMENT 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with","page_number":199,"box":{"x":69,"y":83,"width":785,"height":11}},{"id":"eaeacfb2-9885-4c8e-8d63-c2384cce41ac","block_type":"box","text":"issuers.","page_number":199,"box":{"x":70,"y":98,"width":54,"height":9}},{"id":"c9608cde-136d-4190-9cfd-74b351f31c60","block_type":"box","text":"1","page_number":199,"box":{"x":131,"y":94,"width":4,"height":4}},{"id":"e27e003e-c8d4-4357-bd03-bcb7bca5dcd9","block_type":"box","text":"BAIS works in par tnership with BlackRock’s investment teams, excluding index equity","page_number":199,"box":{"x":141,"y":98,"width":606,"height":11}},{"id":"c7cd9bc6-59f5-429b-bf09-56dc8ff3956f","block_type":"box","text":"2","page_number":199,"box":{"x":747,"y":98,"width":4,"height":4}},{"id":"d212b2eb-f818-441e-863f-dd2783355c31","block_type":"box","text":", providing exper tise","page_number":199,"box":{"x":753,"y":98,"width":143,"height":11}},{"id":"5a179955-3844-4051-8819-718a1e4beec2","block_type":"box","text":"on investment stewardship and engaging with companies alongside and on behalf of those teams when appropriate.","page_number":199,"box":{"x":69,"y":113,"width":828,"height":11}},{"id":"a480d62b-ee35-408a-8aca-d70a6c79d32d","block_type":"box","text":"The team is responsible for establishing voting guidelines for the active equity platform, providing vote","page_number":199,"box":{"x":68,"y":128,"width":729,"height":11}},{"id":"668ca5ad-20d7-4343-94fe-864677d1cd2d","block_type":"box","text":"recommendations and operationalizing voting decisions. The guidance informs the voting recommendations BAIS","page_number":199,"box":{"x":69,"y":143,"width":803,"height":11}},{"id":"732d6805-ab50-401a-8f6f-c6a984194e1b","block_type":"box","text":"makes to BlackRock’s active por tfolio managers. It applies to active equity holdings in BlackRock’s fundamental","page_number":199,"box":{"x":69,"y":158,"width":800,"height":11}},{"id":"7fbc26bb-c011-4e05-baf7-174cfb0f4d47","block_type":"box","text":"equity, systematic equity and multi-asset solutions strategies. It also may apply to holdings in BlackRock’s index and","page_number":199,"box":{"x":69,"y":173,"width":831,"height":11}},{"id":"1e218d51-6b58-4ef5-b566-fb8c5f54fbfc","block_type":"box","text":"active fixed income strategies, to the extent those strategies hold voting securities or conduct issuer engagements.","page_number":199,"box":{"x":69,"y":188,"width":823,"height":12}},{"id":"92052954-96db-4d53-9d92-f56bdfdf6c00","block_type":"box","text":"The guidelines are not prescriptive as active por tfolio managers have discretion as to how they integrate these","page_number":199,"box":{"x":68,"y":203,"width":789,"height":12}},{"id":"bfe9270b-85fe-45e1-b76a-2e8bd2a7d694","block_type":"box","text":"guidelines within their investment processes in light of their clients’ or funds’ investment objectives. There are","page_number":199,"box":{"x":68,"y":218,"width":788,"height":12}},{"id":"242f2c6f-8014-4eb1-af86-9d301725c8b0","block_type":"box","text":"separate, independently developed principles and voting policies that are applied to BlackRock’s index equity","page_number":199,"box":{"x":69,"y":234,"width":778,"height":11}},{"id":"e7d76503-fefe-4fa7-b0e4-83c346c3658f","block_type":"box","text":"investments by a distinct and independent function, BlackRock Investment Stewardship.","page_number":199,"box":{"x":70,"y":249,"width":627,"height":11}},{"id":"b5d8b756-22de-41b7-9b6c-4fdb3b5fe8da","block_type":"box","text":"1","page_number":199,"box":{"x":69,"y":294,"width":4,"height":4}},{"id":"2c544861-3538-4d01-8849-f251d971aeed","block_type":"box","text":"This document includes BAIS’ benchmark policy, which covers nearly all active equity holdings in BlackRock’s","page_number":199,"box":{"x":78,"y":293,"width":777,"height":11}},{"id":"b4c945d7-86eb-4b6c-a0eb-2f377f9e2605","block_type":"box","text":"fundamental equity, systematic equity and multi-asset solutions strategies. The benchmark policy also may apply to","page_number":199,"box":{"x":68,"y":308,"width":823,"height":11}},{"id":"504b6e02-0c27-41df-ab5c-caf535de0b9c","block_type":"box","text":"holdings in BlackRock’s index and active fixed income strategies, to the extent those strategies hold voting securities","page_number":199,"box":{"x":69,"y":323,"width":837,"height":12}},{"id":"1096656a-ed2b-4eef-902b-cd1ef6110639","block_type":"box","text":"or conduct issuer engagements. This document also includes BAIS’ decarbonization policy, which covers holdings in","page_number":199,"box":{"x":69,"y":339,"width":824,"height":11}},{"id":"1d6dbb3c-dbea-4277-8544-b9c5628d686d","block_type":"box","text":"BlackRock active funds that have climate and decarbonization objectives in addition to financial objectives.","page_number":199,"box":{"x":70,"y":354,"width":759,"height":11}},{"id":"48007d34-222a-4b96-877c-20c611011370","block_type":"box","text":"2","page_number":199,"box":{"x":69,"y":372,"width":4,"height":4}},{"id":"eb37b89b-46dc-4b2c-92af-2a9154324ef0","block_type":"box","text":"BlackRock segmented active and index equity investment functions, including stewardship, in January 2025 as par t","page_number":199,"box":{"x":79,"y":371,"width":825,"height":11}},{"id":"8008e01b-73a2-40aa-a628-925033b23cff","block_type":"box","text":"of a strategic initiative to unlock the full breadth of the firm’s active and private markets capabilities for clients. As a","page_number":199,"box":{"x":69,"y":386,"width":830,"height":12}},{"id":"5575b838-9ed3-43e7-b54b-666c2dce3060","block_type":"box","text":"result, there are two stewardship teams, which operate independently of one another and have separate voting","page_number":199,"box":{"x":69,"y":401,"width":792,"height":12}},{"id":"9937fa35-a503-43bf-b355-f31850b3bf28","block_type":"box","text":"policies.","page_number":199,"box":{"x":70,"y":417,"width":56,"height":11}},{"id":"1352ae18-a94f-4950-b00d-7505ebe3f585","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":199,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"6ae8f352-8b9d-4229-af3c-d1793a8e52e5","block_type":"box","text":"Global Engagement and Voting Guidelines | 3","page_number":199,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"01b2591f-7dcf-4b37-888a-4c0284d2a498","block_type":"box","text":"NM1026U-6033063-199/246","page_number":199,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"64a856ce-c9c0-45b8-b8a1-662571a839b8","block_type":"box","text":"INTRODUCTION TO BLACKROCK","page_number":200,"box":{"x":372,"y":45,"width":235,"height":9}},{"id":"630836e3-63c8-4eca-a6b3-37daa3e2632e","block_type":"box","text":"BlackRock’s mission is to help more people invest better. The money BlackRock manages is not its own — it","page_number":200,"box":{"x":102,"y":64,"width":777,"height":11}},{"id":"5b3542b2-6648-46d9-a1bb-d0f0eb9447b4","block_type":"box","text":"belongs to BlackRock’s clients, many of whom make their own asset allocation and por tfolio construction decisions.","page_number":200,"box":{"x":69,"y":78,"width":828,"height":12}},{"id":"f8469dcb-d1e9-4894-b2c1-a99744d6c957","block_type":"box","text":"As a fiduciary, BlackRock invests on clients’ behalf to help them meet their investment objectives. The firm does this","page_number":200,"box":{"x":68,"y":93,"width":835,"height":11}},{"id":"22b38640-eedb-48f9-8f53-fa16ef2aa342","block_type":"box","text":"by understanding clients’ long-term investment objectives and offering choice on how and where they wish to invest","page_number":200,"box":{"x":69,"y":108,"width":823,"height":11}},{"id":"aa5fd4eb-f156-4cfb-86ff-f67d17062170","block_type":"box","text":"their money. BlackRock then helps clients seek the best risk-adjusted returns based on those choices, underpinning","page_number":200,"box":{"x":68,"y":123,"width":830,"height":11}},{"id":"a6a5827f-ae72-44fa-93f8-b12bafcaea3d","block_type":"box","text":"this work with research, data and analytics.","page_number":200,"box":{"x":68,"y":138,"width":309,"height":11}},{"id":"76393169-6361-4479-b884-4876b3c622d2","block_type":"box","text":"At BlackRock, investment stewardship is core to our role as an asset manager and a fiduciary to our clients. As","page_number":200,"box":{"x":101,"y":156,"width":796,"height":12}},{"id":"4da21542-d0e8-431d-ab7e-ca693a30e616","block_type":"box","text":"stewards of our clients’ assets, we engage with companies to discuss the corporate governance and business","page_number":200,"box":{"x":69,"y":171,"width":787,"height":12}},{"id":"bde092ce-9a17-4115-a348-b293254d66a9","block_type":"box","text":"practices that, in our experience, suppor t companies in delivering durable, risk-adjusted financial returns over time.","page_number":200,"box":{"x":70,"y":186,"width":820,"height":12}},{"id":"45dbaaab-99f6-4678-a2f9-ef6e6230ba42","block_type":"box","text":"We are committed to building strong relationships through constructive, ongoing dialogue with the boards and","page_number":200,"box":{"x":68,"y":201,"width":782,"height":11}},{"id":"4077b2b2-26df-4068-a1c6-1500d537ca3d","block_type":"box","text":"executive management of the companies in which our clients are invested.","page_number":200,"box":{"x":69,"y":216,"width":531,"height":11}},{"id":"271f63a6-571f-452f-9c18-74bd2f46db58","block_type":"box","text":"ABOUT BLACKROCK ACTIVE INVESTMENT STEWARDSHIP","page_number":200,"box":{"x":277,"y":246,"width":424,"height":9}},{"id":"1e5371aa-7e5f-4eba-8c57-31d0639b693a","block_type":"box","text":"BlackRock Active Investment Stewardship (BAIS) is a specialist team within the Por tfolio Management Group and","page_number":200,"box":{"x":102,"y":265,"width":804,"height":11}},{"id":"99cbed8e-21a4-4025-9dfd-5a1d8fec80ba","block_type":"box","text":"manages BlackRock’s stewardship engagement and voting on behalf of clients invested in active strategies globally.","page_number":200,"box":{"x":69,"y":280,"width":826,"height":11}},{"id":"64255e2d-eedb-4cec-bfae-4645cd5af72a","block_type":"box","text":"BAIS is also responsible for engagement with issuers in index fixed income strategies, where appropriate. Our","page_number":200,"box":{"x":70,"y":295,"width":783,"height":11}},{"id":"afcd4760-6fa4-4efc-b66e-1e0fc2e811a0","block_type":"box","text":"activities are informed by these Global Engagement and Voting Guidelines (the “Guidelines”) and insights from active","page_number":200,"box":{"x":69,"y":309,"width":834,"height":12}},{"id":"c120830f-ab61-4f88-8398-4c55e4b7c4c4","block_type":"box","text":"investment analysts and por tfolio managers, with whom we work closely in engaging companies and voting at","page_number":200,"box":{"x":70,"y":324,"width":779,"height":12}},{"id":"e4346fbf-d845-42ae-a1fa-31d12be22777","block_type":"box","text":"shareholder meetings.","page_number":200,"box":{"x":69,"y":339,"width":158,"height":11}},{"id":"0c92a7be-fdbc-4621-9408-338f8cd7572a","block_type":"box","text":"Engagement with public companies is the foundation of our approach to stewardship within fundamental active","page_number":200,"box":{"x":102,"y":358,"width":789,"height":11}},{"id":"79a85709-218a-4e39-a89c-77308687e471","block_type":"box","text":"investing.","page_number":200,"box":{"x":70,"y":373,"width":65,"height":11}},{"id":"bca13f65-140a-44e1-86d9-3666a3fb081d","block_type":"box","text":"3","page_number":200,"box":{"x":137,"y":373,"width":4,"height":5}},{"id":"7481aeeb-8861-471e-8419-d2f9a1e1bdca","block_type":"box","text":"Through direct dialogue with company leadership, we seek to understand their businesses and how they","page_number":200,"box":{"x":146,"y":373,"width":744,"height":11}},{"id":"b47d7095-9a2e-497d-b3e9-ea7915c17890","block_type":"box","text":"manage risks and oppor tunities to deliver durable, risk-adjusted financial returns. Por tfolio managers and","page_number":200,"box":{"x":69,"y":387,"width":751,"height":12}},{"id":"20e256e8-7d6a-4673-8628-05846d3ef341","block_type":"box","text":"stewardship specialists may engage jointly or independently on material corporate governance matters. Our","page_number":200,"box":{"x":69,"y":402,"width":765,"height":12}},{"id":"8d3184bb-3b8c-4488-b7ee-b73976e2cf61","block_type":"box","text":"discussions focus on topics relevant to a company’s success over time, including governance and leadership,","page_number":200,"box":{"x":69,"y":417,"width":782,"height":12}},{"id":"1dc86931-a48b-446e-94ec-85fb96e9f7f2","block_type":"box","text":"corporate strategy, capital structure and financial per formance, operations and material sustainability-related risks,","page_number":200,"box":{"x":69,"y":432,"width":820,"height":11}},{"id":"de03fa66-3b57-4ce0-8c68-82c62c4bad61","block_type":"box","text":"as well as macro-economic, geopolitical and sector dynamics. We aim to be constructive investors and are generally","page_number":200,"box":{"x":69,"y":447,"width":828,"height":11}},{"id":"e58bde46-af57-4a95-873e-4b91be51fbde","block_type":"box","text":"suppor tive of management teams that have a track record of financial value creation. We aim to build and maintain","page_number":200,"box":{"x":69,"y":462,"width":821,"height":11}},{"id":"cad39234-1156-430e-bc11-d93ae597d04b","block_type":"box","text":"strong relationships with company leadership based on open dialogue and mutual respect.","page_number":200,"box":{"x":69,"y":477,"width":645,"height":11}},{"id":"7acbb612-83b0-497b-bfda-5f0fc7075357","block_type":"box","text":"Different active equity strategies may implement these voting guidelines differently, as a result of the latitude","page_number":200,"box":{"x":102,"y":495,"width":780,"height":12}},{"id":"a488b6fd-5706-45c6-ad56-5eee96358516","block_type":"box","text":"each por tfolio manager has to make independent voting decisions on their holdings. For example, BAIS will generally","page_number":200,"box":{"x":69,"y":510,"width":831,"height":11}},{"id":"8cc01b12-c006-4115-af41-cf31583bd7be","block_type":"box","text":"vote the holdings in Systematic Active Equity por tfolios in accordance with these guidelines. We provide voting","page_number":200,"box":{"x":68,"y":525,"width":787,"height":11}},{"id":"2a46f7f5-9d87-43c3-832b-ff3802810e79","block_type":"box","text":"recommendations to fundamental equity por tfolio managers, who may determine to vote differently based on each","page_number":200,"box":{"x":69,"y":540,"width":816,"height":11}},{"id":"35c62f90-0f9a-4dbd-8104-dcb2dc227db8","block_type":"box","text":"por tfolio’s investment objectives and strategy.","page_number":200,"box":{"x":70,"y":555,"width":327,"height":11}},{"id":"98d58c82-dca0-465b-a2eb-24637a736b1b","block_type":"box","text":"These guidelines discuss BAIS’ views on corporate governance topics on which we may engage with","page_number":200,"box":{"x":101,"y":574,"width":711,"height":11}},{"id":"d56b9af5-27fa-4611-8130-bb6daa61b3d2","block_type":"box","text":"management teams and board directors","page_number":200,"box":{"x":69,"y":589,"width":285,"height":11}},{"id":"ae29a504-c38e-412a-9aba-2afa658bc322","block_type":"box","text":"4","page_number":200,"box":{"x":355,"y":589,"width":5,"height":4}},{"id":"c7c4a8d3-3c48-4f55-915e-57e9afab9a1a","block_type":"box","text":"and on matters that routinely come to a shareholder vote. We recognize that","page_number":200,"box":{"x":366,"y":589,"width":544,"height":11}},{"id":"5fe2fcda-fbbb-44c6-9695-4d0c94f544b4","block_type":"box","text":"accepted corporate governance norms can differ across markets, and believe these guidelines represent globally","page_number":200,"box":{"x":69,"y":603,"width":807,"height":11}},{"id":"11ef0c0c-21d0-4073-9607-58a50aea813b","block_type":"box","text":"applicable elements of governance that suppor t a company’s ability to manage material risks and oppor tunities and","page_number":200,"box":{"x":69,"y":618,"width":827,"height":11}},{"id":"5b635e9a-2a58-40b4-be21-83415208d1a7","block_type":"box","text":"deliver financial returns to investors. Generally, we believe companies should observe accepted corporate governance","page_number":200,"box":{"x":69,"y":633,"width":840,"height":11}},{"id":"49c57ca5-4028-4362-a5fa-02573d4359eb","block_type":"box","text":"norms within their local markets or, par ticularly in markets without well-established norms, aspire to widely","page_number":200,"box":{"x":69,"y":648,"width":762,"height":11}},{"id":"594f454a-d868-432d-a138-acb5880726d6","block_type":"box","text":"recognized international best practices. As one of many minority shareholders, BlackRock cannot – and does not try","page_number":200,"box":{"x":69,"y":663,"width":827,"height":11}},{"id":"d79f9f20-9946-49e5-9a90-f24ecbf8214a","block_type":"box","text":"to – direct a company’s strategy or its implementation. We look to companies to provide disclosures that explain how","page_number":200,"box":{"x":68,"y":678,"width":837,"height":11}},{"id":"cc469e04-1c81-422a-ac94-6c6d468c11a5","block_type":"box","text":"their approach to corporate governance best aligns with the financial interests of their investors.","page_number":200,"box":{"x":68,"y":692,"width":687,"height":12}},{"id":"d5d60464-5359-41b4-8894-c5b968ed3920","block_type":"box","text":"OUR APPROACH TO STEWARDSHIP WITHIN ACTIVE EQUITIES","page_number":200,"box":{"x":263,"y":722,"width":451,"height":11}},{"id":"a47a2c98-112e-436d-9253-6cffe4943b88","block_type":"box","text":"Voting at a company’s shareholder meeting is a right of share ownership and a core principle of corporate","page_number":200,"box":{"x":101,"y":741,"width":753,"height":12}},{"id":"f88b34f4-5d0c-46bd-8213-83c08f7a6b20","block_type":"box","text":"governance. The voting rights attached to clients’ holdings are an impor tant mechanism for investors to express","page_number":200,"box":{"x":68,"y":756,"width":801,"height":11}},{"id":"c5aef2ab-7ba9-4b18-afdf-1818b7c9e96a","block_type":"box","text":"suppor t for, or concern about, a company’s per formance. As a fiduciary, BlackRock is legally required to make proxy","page_number":200,"box":{"x":69,"y":771,"width":829,"height":11}},{"id":"a4ca6b96-6f83-4e92-8148-1aa64fb757b0","block_type":"box","text":"voting determinations, on behalf of clients who have delegated voting authority to us, in a manner consistent with","page_number":200,"box":{"x":68,"y":786,"width":809,"height":11}},{"id":"2eb9e8ec-bf90-43f6-b562-ea694c516404","block_type":"box","text":"BlackRock’s contractual arrangements with clients and funds.","page_number":200,"box":{"x":70,"y":801,"width":438,"height":11}},{"id":"128b8753-842c-4e45-a67f-87ab807b8426","block_type":"box","text":"3","page_number":200,"box":{"x":69,"y":830,"width":4,"height":5}},{"id":"e6f50aa8-8d71-4388-96c8-05117ce58b9e","block_type":"box","text":"On February 11, 2025, the U.S. Securities and Exchange Commission (SEC) staff issued updated guidance for","page_number":200,"box":{"x":79,"y":830,"width":790,"height":11}},{"id":"a13ebbf0-2d45-48b7-b910-2dc22610adf5","block_type":"box","text":"shareholders to maintain their eligibility to repor t their beneficial ownership under Schedule 13G of the Exchange Act.","page_number":200,"box":{"x":69,"y":845,"width":836,"height":11}},{"id":"cd0b0da3-675e-48ca-a6a4-dfa125723b5a","block_type":"box","text":"We comply fully with these requirements and do not engage with por tfolio companies for the purpose, or with the","page_number":200,"box":{"x":68,"y":860,"width":805,"height":11}},{"id":"5b610a32-76ab-4fd0-b144-00dc445f7948","block_type":"box","text":"effect, of changing or influencing control of the company.","page_number":200,"box":{"x":69,"y":875,"width":403,"height":12}},{"id":"163ea7c8-7fe3-4427-a18c-7e7d42af2b98","block_type":"box","text":"4","page_number":200,"box":{"x":69,"y":893,"width":4,"height":5}},{"id":"480e0116-61ad-482c-9621-582418f5a27a","block_type":"box","text":"References to the board, board directors or non-executive directors should be understood to include supervisory","page_number":200,"box":{"x":79,"y":893,"width":801,"height":11}},{"id":"b514aafc-76dc-4d44-a990-0c5192d34491","block_type":"box","text":"boards and their members, where relevant.","page_number":200,"box":{"x":69,"y":908,"width":306,"height":11}},{"id":"9d446c4d-292c-4b53-ae6f-80b2e3a3979c","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":200,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"46ae651a-b9ef-444b-996d-7fac69e5e1e7","block_type":"box","text":"Global Engagement and Voting Guidelines | 4","page_number":200,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"910819e3-a33e-4dd7-b76a-baceb9bb64c0","block_type":"box","text":"NM1026U-6033063-200/246","page_number":200,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"0c43d919-51bf-4a51-b539-54befca3621c","block_type":"box","text":"In general, we tend to suppor t the recommendations of the board of directors and management. As indicated","page_number":201,"box":{"x":102,"y":45,"width":778,"height":11}},{"id":"8ca7fd2b-d1dd-45e4-ad29-f6ffc34104f1","block_type":"box","text":"below, we may vote against management recommendations when we have concerns about how companies are","page_number":201,"box":{"x":69,"y":60,"width":788,"height":11}},{"id":"1d9c3258-67b5-458c-b416-2a8f03cc2e87","block_type":"box","text":"serving the financial interests of our clients as their shareholders. BAIS takes a globally consistent approach to","page_number":201,"box":{"x":69,"y":74,"width":795,"height":12}},{"id":"ccb8c669-7ab3-4547-a138-8c371f9f6984","block_type":"box","text":"voting but considers the different corporate governance regulations and norms across markets. Votes are determined","page_number":201,"box":{"x":68,"y":89,"width":839,"height":12}},{"id":"1faa6bf6-31f9-4c77-9b36-abdca60af341","block_type":"box","text":"on a case-by-case basis, in the context of a company’s situation and the investment mandate we have from clients.","page_number":201,"box":{"x":69,"y":104,"width":823,"height":11}},{"id":"b9b02535-eaba-4d65-9075-90d00137f1b0","block_type":"box","text":"Please see page 19 for more information about how we fulfill and oversee our investment stewardship","page_number":201,"box":{"x":69,"y":119,"width":729,"height":11}},{"id":"78432375-052c-40aa-9672-e45790958136","block_type":"box","text":"responsibilities for BlackRock’s non-index equity strategies.","page_number":201,"box":{"x":69,"y":134,"width":423,"height":11}},{"id":"28ed09e1-858b-4636-91cd-80eae59507d3","block_type":"box","text":"5","page_number":201,"box":{"x":493,"y":134,"width":5,"height":5}},{"id":"436220cd-6266-44dd-a7b1-046cec9e4681","block_type":"box","text":"OUR APPROACH TO STEWARDSHIP WITHIN FIXED INCOME","page_number":201,"box":{"x":272,"y":164,"width":434,"height":9}},{"id":"81f5e558-5347-40cb-b7e7-649a5df76cda","block_type":"box","text":"Although fixed income investors do not have the right to vote at shareholder meetings, issuer engagement is a","page_number":201,"box":{"x":101,"y":183,"width":788,"height":11}},{"id":"59d61839-6afe-4536-8cdd-07534837736b","block_type":"box","text":"component of fixed income investment strategies at BlackRock, par ticularly for those with sustainability objectives in","page_number":201,"box":{"x":69,"y":198,"width":831,"height":11}},{"id":"03ea8390-deee-49ec-90ae-f39a9fdd15a3","block_type":"box","text":"addition to financial objectives. Most corporate governance-related fixed income engagements are under taken in","page_number":201,"box":{"x":69,"y":212,"width":801,"height":12}},{"id":"cf8a2b36-339a-4d84-91d9-e212e045b3e4","block_type":"box","text":"conjunction with the active investment stewardship team, and often active equity investors. In addition to the topics","page_number":201,"box":{"x":69,"y":227,"width":824,"height":11}},{"id":"ead66627-3d25-4281-a3a6-e2c09c50e078","block_type":"box","text":"listed below, engagement with fixed income investment teams may help inform an issuer’s approach to structuring","page_number":201,"box":{"x":70,"y":242,"width":816,"height":11}},{"id":"f520d150-25af-4044-a3da-15a89241b4a7","block_type":"box","text":"specialist issuances and the standard terms and information in bond documentation.","page_number":201,"box":{"x":69,"y":257,"width":608,"height":11}},{"id":"64612532-4234-4425-b6b7-52df9bf6d6f1","block_type":"box","text":"5","page_number":201,"box":{"x":69,"y":302,"width":4,"height":4}},{"id":"6f021f39-c57b-45fa-ac90-1063b47041d9","block_type":"box","text":"Non-index equity strategies include active equity holdings in BlackRock’s fundamental equity, systematic equity and","page_number":201,"box":{"x":79,"y":301,"width":820,"height":11}},{"id":"e87e0b13-ba0d-46e7-9ed1-221d35b3dbd1","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":201,"box":{"x":69,"y":316,"width":822,"height":12}},{"id":"3b16b193-ca17-43a6-a157-0ae508ee7b24","block_type":"box","text":"extent those strategies hold voting securities or conduct issuer engagements.","page_number":201,"box":{"x":69,"y":332,"width":554,"height":11}},{"id":"61a39c57-8793-4025-a92a-2be2b60cb3b1","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":201,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"b7f65c88-82a4-4e9d-bbed-601a3002156a","block_type":"box","text":"Global Engagement and Voting Guidelines | 5","page_number":201,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"4c018d78-3da0-490e-81a3-d456a70b3b00","block_type":"box","text":"NM1026U-6033063-201/246","page_number":201,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"e68e018e-1013-48d4-9af2-7b599cce7629","block_type":"box","text":"BOARDS OF DIRECTORS","page_number":202,"box":{"x":400,"y":45,"width":178,"height":9}},{"id":"a82068ee-d075-45bd-80e6-d87ea567fabb","block_type":"box","text":"Roles and responsibilities","page_number":202,"box":{"x":69,"y":67,"width":186,"height":11}},{"id":"eda1dfa9-be13-42d4-a909-1063bf6af382","block_type":"box","text":"There is widespread consensus that the foundation of good corporate governance is an effective board of","page_number":202,"box":{"x":101,"y":86,"width":754,"height":11}},{"id":"2bb7d16a-db66-4f08-afef-d5bfafd99482","block_type":"box","text":"directors that is able to advise and supervise management in an independent and objective manner.","page_number":202,"box":{"x":69,"y":101,"width":715,"height":11}},{"id":"cc35f0be-028c-4b78-a453-0ae63d3303d2","block_type":"box","text":"6","page_number":202,"box":{"x":786,"y":101,"width":4,"height":5}},{"id":"fba4434e-5d93-49db-bbca-35d3187ee226","block_type":"box","text":"We look to the board of directors (hereafter the “board”) to have an oversight role in the establishment and","page_number":202,"box":{"x":101,"y":119,"width":765,"height":12}},{"id":"b3234c2b-cc1c-4ae4-bf09-a297d606d8e2","block_type":"box","text":"realization of a company’s strategy, purpose and culture. These constructs are interdependent and, when aligned,","page_number":202,"box":{"x":69,"y":134,"width":811,"height":12}},{"id":"e52d864d-5aa9-4dd4-bcc6-2764fdc964a7","block_type":"box","text":"can better position a company to be resilient in the face of a changing business environment, help reduce the risks","page_number":202,"box":{"x":69,"y":149,"width":822,"height":11}},{"id":"c42cfd40-0878-4a80-be63-740344361962","block_type":"box","text":"of corporate or employee misconduct, and attract and retain the caliber of workers necessary to deliver financial","page_number":202,"box":{"x":69,"y":164,"width":799,"height":11}},{"id":"457148f4-a5c3-46b6-afa5-288f2c36ceca","block_type":"box","text":"per formance over time.","page_number":202,"box":{"x":70,"y":179,"width":164,"height":11}},{"id":"8e2c9b84-028d-465c-a585-1aaded7722cb","block_type":"box","text":"In overseeing the management of the company, the board ensures the necessary resources, policies and","page_number":202,"box":{"x":102,"y":198,"width":750,"height":11}},{"id":"c33f1b39-1941-4c40-a2ae-6544b5ceb6c7","block_type":"box","text":"procedures are in place to help management meet its strategic objectives within an agreed risk tolerance.","page_number":202,"box":{"x":70,"y":213,"width":753,"height":11}},{"id":"bf0e5d25-7736-4c05-a913-930edf743da9","block_type":"box","text":"One of the most impor tant responsibilities of the board is to appoint, and remove as necessary, the chief","page_number":202,"box":{"x":102,"y":231,"width":753,"height":11}},{"id":"8c43e7f5-754e-4c06-8153-0605a3840607","block_type":"box","text":"executive officer (“CEO”). In addition, the board plays a meaningful role in monitoring the per formance of the CEO","page_number":202,"box":{"x":69,"y":246,"width":811,"height":11}},{"id":"ba997dfc-83d3-4dde-bdbe-71654448a413","block_type":"box","text":"and other key executives, determining executive compensation, ensuring a rigorous audit, overseeing strategy","page_number":202,"box":{"x":69,"y":261,"width":783,"height":11}},{"id":"7c22aaaf-e160-42cb-8e01-edb2b5aabce0","block_type":"box","text":"execution and risk management and engaging with shareholders, and other stakeholders, as necessary.","page_number":202,"box":{"x":69,"y":276,"width":742,"height":11}},{"id":"4693ce5b-ffd6-4567-b3f1-7ea347a22689","block_type":"box","text":"Composition and effectiveness","page_number":202,"box":{"x":69,"y":298,"width":224,"height":11}},{"id":"d3f69e5e-7d17-43f2-ba5c-05f138d9c133","block_type":"box","text":"Appointment process","page_number":202,"box":{"x":68,"y":317,"width":152,"height":11}},{"id":"90703ed1-0faf-451c-ba52-cb6b016dd5c0","block_type":"box","text":"A formal and transparent process for identifying and appointing director candidates is critical to ensuring the","page_number":202,"box":{"x":101,"y":335,"width":773,"height":12}},{"id":"be4fc485-8e49-4a94-a379-8b0316aa0a4d","block_type":"box","text":"board is composed of directors with the appropriate mix of skills and experience. Generally, the board or a sub","page_number":202,"box":{"x":69,"y":350,"width":792,"height":11}},{"id":"322e0213-6407-4a16-bb46-5c694d4eb0e5","block_type":"box","text":"committee determines the general criteria given the company’s circumstances (","page_number":202,"box":{"x":69,"y":365,"width":568,"height":11}},{"id":"5cf43516-7d87-4e01-95b4-4541eb15cacf","block_type":"box","text":"e.g.","page_number":202,"box":{"x":638,"y":367,"width":25,"height":9}},{"id":"420824eb-1165-4a5f-85ec-73611485f53e","block_type":"box","text":", sector, maturity, geographic","page_number":202,"box":{"x":666,"y":365,"width":204,"height":11}},{"id":"c8a6cd3c-6b2d-440b-b142-8894e924b593","block_type":"box","text":"footprint) and any additional criteria for a specific role being filled (","page_number":202,"box":{"x":68,"y":380,"width":474,"height":11}},{"id":"f05d50e3-126a-4a3b-84a4-9bc60cc13d83","block_type":"box","text":"e.g.","page_number":202,"box":{"x":544,"y":381,"width":25,"height":10}},{"id":"73c3eacc-bca4-4387-b3c1-a1b2f423f588","block_type":"box","text":", financial exper tise, industry track record). To","page_number":202,"box":{"x":571,"y":380,"width":327,"height":11}},{"id":"db032e53-63aa-4b83-8d15-1eb0d0d79287","block_type":"box","text":"inform the process, we encourage companies to review the skills and experience of incumbent directors to identify","page_number":202,"box":{"x":70,"y":395,"width":815,"height":11}},{"id":"5f7c3189-c133-40cf-8b3b-9096a7b5b2c0","block_type":"box","text":"any gaps and whether the skills and experience of a director candidate would be additive. We welcome disclosures","page_number":202,"box":{"x":69,"y":410,"width":817,"height":11}},{"id":"5aff14b5-535a-489e-be15-61aeb51ffefc","block_type":"box","text":"that explain how the board considered different skills and experience to ensure that the directors collectively can be","page_number":202,"box":{"x":68,"y":425,"width":829,"height":11}},{"id":"a7fb2581-d7d4-47f8-8b0a-eff5f2843882","block_type":"box","text":"effective in fulfilling their responsibilities. We assess a company’s board composition against that of its peer group","page_number":202,"box":{"x":69,"y":439,"width":821,"height":12}},{"id":"d3481741-5af2-4d95-bb64-0b77f8fb1d9d","block_type":"box","text":"and local market requirements.","page_number":202,"box":{"x":69,"y":455,"width":221,"height":10}},{"id":"24d579db-41f2-418a-9f26-eae673a66e9c","block_type":"box","text":"Shareholders periodically vote to elect directors to serve on the board. We do not prescribe any par ticular board","page_number":202,"box":{"x":102,"y":473,"width":798,"height":11}},{"id":"6340bd49-cb99-4d81-8b02-78bce65829f4","block_type":"box","text":"composition in our engagements or voting but seek to understand how well placed a board is to act in investors’","page_number":202,"box":{"x":69,"y":488,"width":800,"height":11}},{"id":"927fa967-ef51-46ab-9f5a-728f8a7d1d5d","block_type":"box","text":"interests. We may vote against the election of the most senior independent director, or the chair of the relevant","page_number":202,"box":{"x":70,"y":503,"width":794,"height":11}},{"id":"dd553d6e-fb49-4de2-92b4-6367ac1adb77","block_type":"box","text":"committee, where a company has not demonstrated it has an appointment process that results in a high functioning","page_number":202,"box":{"x":69,"y":517,"width":830,"height":12}},{"id":"6ee2c65a-fb9f-4e39-a89a-03ecfe6080fb","block_type":"box","text":"board with the appropriate complement of skills and experience amongst the directors to suppor t strong financial","page_number":202,"box":{"x":69,"y":532,"width":808,"height":12}},{"id":"7d77ab07-6879-490a-aa49-5bc0f3bdc477","block_type":"box","text":"per formance over time. We may vote against newly nominated directors who do not seem to have the appropriate","page_number":202,"box":{"x":70,"y":547,"width":808,"height":12}},{"id":"34d95faf-94f1-4404-8aeb-a696c284a0da","block_type":"box","text":"skills or experience to contribute to the board’s effectiveness.","page_number":202,"box":{"x":69,"y":562,"width":442,"height":11}},{"id":"361ac2f4-9675-46ed-ace1-83c8de10863d","block_type":"box","text":"Independence","page_number":202,"box":{"x":70,"y":585,"width":99,"height":10}},{"id":"b2b28f32-0cc9-4991-96c8-325a31ce218c","block_type":"box","text":"Director independence from management, significant shareholders or other stakeholders (","page_number":202,"box":{"x":102,"y":603,"width":642,"height":11}},{"id":"51e2c1c2-9212-4819-9f2d-adce8ddc4988","block_type":"box","text":"e.g.","page_number":202,"box":{"x":746,"y":605,"width":25,"height":9}},{"id":"5cdcd186-b072-4fbd-ac78-b02c1dacfc1a","block_type":"box","text":", government or","page_number":202,"box":{"x":773,"y":604,"width":111,"height":10}},{"id":"5f5f6253-1a61-46d5-9915-0b1d67e5f8a6","block_type":"box","text":"employees) is of paramount impor tance to the protection of the interests of minority shareholders such as","page_number":202,"box":{"x":69,"y":618,"width":759,"height":11}},{"id":"831da96c-d0c0-4e44-80c7-27eec34f4a9a","block_type":"box","text":"BlackRock’s clients. We consider it good practice for at least half the directors to be independent and free from","page_number":202,"box":{"x":70,"y":633,"width":793,"height":11}},{"id":"8121f653-a963-484e-9ad8-44d6d4490e81","block_type":"box","text":"conflicts of interest or undue influence.","page_number":202,"box":{"x":69,"y":648,"width":278,"height":9}},{"id":"e990d856-da74-4521-940b-b36036aef390","block_type":"box","text":"7","page_number":202,"box":{"x":349,"y":648,"width":4,"height":5}},{"id":"a520be47-3d38-4572-bdb7-6f00ae816109","block_type":"box","text":"This also helps to ensure that board committees are composed of a","page_number":202,"box":{"x":358,"y":648,"width":486,"height":11}},{"id":"e5ec4bcf-981f-46fa-9060-a721daf8385a","block_type":"box","text":"sufficient number of independent directors. Companies domiciled in markets with a higher threshold for board","page_number":202,"box":{"x":69,"y":663,"width":783,"height":11}},{"id":"0512b915-5044-4b83-92d6-7784bdddca58","block_type":"box","text":"independence should meet those local requirements.","page_number":202,"box":{"x":70,"y":678,"width":378,"height":10}},{"id":"e5a717e6-0017-43b4-b310-08e837e709d2","block_type":"box","text":"We may vote against the election of non-independent directors if the board does not have a sufficient balance of","page_number":202,"box":{"x":101,"y":696,"width":803,"height":11}},{"id":"d3ded26d-95b6-4458-a83f-28214c4449ae","block_type":"box","text":"independence. We may also vote against the election of the chair of the committee responsible for board","page_number":202,"box":{"x":70,"y":711,"width":748,"height":11}},{"id":"b73a939a-f33a-4d2a-9512-a39343235720","block_type":"box","text":"composition if this is a perennial issue.","page_number":202,"box":{"x":69,"y":726,"width":280,"height":11}},{"id":"d2acc6ea-b6a5-4553-8e57-fe5e128f0b2b","block_type":"box","text":"6","page_number":202,"box":{"x":69,"y":756,"width":4,"height":4}},{"id":"50096cfb-7385-4ae7-923e-4a5a30f330a6","block_type":"box","text":"See the Corporate Governance Codes of Germany, Japan, and the UK, as well as the corporate governance","page_number":202,"box":{"x":93,"y":755,"width":763,"height":11}},{"id":"3b1aa4f4-ec9d-4efd-abc3-b30fbb4cc343","block_type":"box","text":"principles of the US Business Roundtable as examples.","page_number":202,"box":{"x":94,"y":770,"width":394,"height":11}},{"id":"72715526-ad51-45ec-8c89-2e16dbd03123","block_type":"box","text":"7","page_number":202,"box":{"x":69,"y":788,"width":4,"height":5}},{"id":"1beb4821-ae68-4f31-b2ee-6cc1b419f91b","block_type":"box","text":"Common impediments to independence may include but are not limited to: current or recent employment at the","page_number":202,"box":{"x":93,"y":788,"width":795,"height":11}},{"id":"7e7e9bdd-cd7d-4ed9-9343-a7d0716f2b5a","block_type":"box","text":"company or a subsidiary; being, or representing, a shareholder with a substantial shareholding in the company;","page_number":202,"box":{"x":93,"y":803,"width":793,"height":11}},{"id":"5db66a4a-3a42-49e3-a49c-d17af8dc10d6","block_type":"box","text":"interlocking directorships; lengthy tenure, and having any other interest, business, or other relationship which","page_number":202,"box":{"x":94,"y":818,"width":778,"height":11}},{"id":"0ffda938-948a-4e30-9ad1-bd18d607e75e","block_type":"box","text":"could, or could reasonably be perceived to, materially inter fere with a director’s ability to act in the best interests","page_number":202,"box":{"x":93,"y":833,"width":807,"height":11}},{"id":"3e0486c3-cb7b-4a5f-b2cf-8238d014f1c8","block_type":"box","text":"of the company and shareholders.","page_number":202,"box":{"x":93,"y":848,"width":242,"height":11}},{"id":"94b4e937-06fb-4a5b-b19e-0bb211fc4a01","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":202,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"c18a6409-b404-487b-9d6c-da91935eca6a","block_type":"box","text":"Global Engagement and Voting Guidelines | 6","page_number":202,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"85b78ba1-ad99-46cb-aaa8-1c976a730ee5","block_type":"box","text":"NM1026U-6033063-202/246","page_number":202,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"84b3741f-eb40-4a12-8a10-527f148d22ee","block_type":"box","text":"Independent board leadership","page_number":203,"box":{"x":70,"y":45,"width":212,"height":11}},{"id":"3276d11f-78af-457b-86b1-02e5e48b1757","block_type":"box","text":"Practices across markets differ, as do board structures, but we observe two main approaches to independent","page_number":203,"box":{"x":102,"y":63,"width":784,"height":11}},{"id":"7d13e067-e84a-4d14-b099-b078dfd2ee6b","block_type":"box","text":"board leadership. One is a non-executive, independent chair of the board who is responsible for leading the board in","page_number":203,"box":{"x":69,"y":78,"width":827,"height":11}},{"id":"936fa76e-182c-4a4d-9a28-b3a2d2e44db2","block_type":"box","text":"the effective exercise of its duties. The other is a lead or senior independent director, who is responsible for","page_number":203,"box":{"x":68,"y":93,"width":774,"height":11}},{"id":"9b9ac39e-1415-470b-b2c9-1685eee598c0","block_type":"box","text":"coordinating with the other non-executive directors and working closely with the executive chair on the board agenda","page_number":203,"box":{"x":69,"y":108,"width":826,"height":11}},{"id":"87b839bf-5c89-47bb-9947-e2a6f704ea87","block_type":"box","text":"and other board procedures. In this case, the executive chair and the lead independent director work together to","page_number":203,"box":{"x":69,"y":123,"width":801,"height":11}},{"id":"4c016070-72fc-431e-bbfe-89f1b8b0c33e","block_type":"box","text":"ensure the board is effectively fulfilling its responsibilities. In our view, the independent leader of the board, and/or","page_number":203,"box":{"x":69,"y":138,"width":823,"height":11}},{"id":"ed7ed750-e9ef-4d7e-bf97-1cd6598b23a0","block_type":"box","text":"the chair of a relevant committee, should be available to investors to discuss governance matters such as CEO","page_number":203,"box":{"x":68,"y":152,"width":793,"height":12}},{"id":"a74f441e-44c8-4ce2-b405-18c88e5a4890","block_type":"box","text":"succession, executive pay, and board per formance. We look to boards to explain their board leadership model and","page_number":203,"box":{"x":69,"y":167,"width":816,"height":11}},{"id":"c7abf435-259a-4c83-b97f-ecb757c04fae","block_type":"box","text":"how it serves the interests of shareholders.","page_number":203,"box":{"x":69,"y":182,"width":311,"height":9}},{"id":"cf03c9e5-d07c-4c29-bebc-b8cb4f1b9c75","block_type":"box","text":"We may vote against the election of the chair of the committee responsible for board composition if there is not","page_number":203,"box":{"x":101,"y":201,"width":798,"height":11}},{"id":"c7bf6807-75bb-413a-9a6a-b1b51c1b4de5","block_type":"box","text":"an identified independent leader of the board with clear responsibilities for board per formance. We may vote against","page_number":203,"box":{"x":69,"y":216,"width":831,"height":11}},{"id":"ed3a80db-5930-4522-96d6-2e40c6376ba8","block_type":"box","text":"the most senior independent director if the board has a policy of not engaging with shareholders.","page_number":203,"box":{"x":68,"y":231,"width":691,"height":11}},{"id":"f8f40274-df61-4ef8-950c-f503c5e38fc4","block_type":"box","text":"Tenure and succession","page_number":203,"box":{"x":70,"y":253,"width":162,"height":9}},{"id":"86cc2776-2750-42dd-81e5-af72c32938f5","block_type":"box","text":"In our view, it is good practice for boards to establish the length of time a director would normally be expected to","page_number":203,"box":{"x":102,"y":272,"width":803,"height":11}},{"id":"905836ba-1706-4a50-ae88-f0384ec55b25","block_type":"box","text":"serve, in line with market norms where those exist. We find it helpful when companies disclose their approach to","page_number":203,"box":{"x":69,"y":286,"width":805,"height":11}},{"id":"a9b72aa3-2a34-43d7-8bb3-fdb34192f260","block_type":"box","text":"director tenure par ticularly around the contributions of directors who have served for longer periods than typically","page_number":203,"box":{"x":69,"y":301,"width":806,"height":12}},{"id":"6592aff5-955d-46a3-b561-b14af8746d75","block_type":"box","text":"provided for under local practice. In our experience, long-serving directors could become less independent given their","page_number":203,"box":{"x":70,"y":316,"width":833,"height":12}},{"id":"bcd4a7e8-8d43-4918-b11c-ad9da963897c","block_type":"box","text":"long-term relationship with management and involvement in past board decisions.","page_number":203,"box":{"x":70,"y":331,"width":581,"height":11}},{"id":"ae1570e4-be0b-4a6f-819c-99111742b43f","block_type":"box","text":"Succession planning for board roles helps achieve the appropriate cadence of turnover that balances renewal","page_number":203,"box":{"x":102,"y":350,"width":779,"height":11}},{"id":"fb3d1247-7bc1-41b2-be8b-434c2f468bca","block_type":"box","text":"through the regular introduction of directors with fresh perspectives and exper tise with continuity through the","page_number":203,"box":{"x":68,"y":365,"width":777,"height":11}},{"id":"86b19de4-a1f1-40a3-9f81-4a23409d86e5","block_type":"box","text":"retention of directors with long-term knowledge of the board and company.","page_number":203,"box":{"x":69,"y":379,"width":528,"height":12}},{"id":"79bffe68-c1d8-4f1c-924c-72eb94ca5548","block_type":"box","text":"In markets where there is not specific director tenure guidance from regulation or corporate governance best","page_number":203,"box":{"x":102,"y":398,"width":774,"height":11}},{"id":"7ca27c63-170a-44cb-b172-7daa80597ee7","block_type":"box","text":"practices, we may vote against the election of the chair of the committee responsible for board composition if a","page_number":203,"box":{"x":70,"y":413,"width":795,"height":11}},{"id":"7ff6ff21-9491-4fdf-ab2d-71f836d9affd","block_type":"box","text":"company does not clearly disclose its approach to director tenure and board renewal. We may vote against the","page_number":203,"box":{"x":69,"y":428,"width":788,"height":11}},{"id":"5884b577-313c-4df1-8fad-58468573be49","block_type":"box","text":"election of directors who have served for more years than is typical in markets with specific guidance, where the case","page_number":203,"box":{"x":69,"y":443,"width":839,"height":11}},{"id":"948b8022-5814-407a-8280-418c25588ab4","block_type":"box","text":"for their continued service is not evident.","page_number":203,"box":{"x":68,"y":458,"width":292,"height":9}},{"id":"96985086-1279-44d4-ae83-35b3e27194c5","block_type":"box","text":"Capacity","page_number":203,"box":{"x":70,"y":480,"width":60,"height":11}},{"id":"3c85ff28-4564-4282-9b97-e3c640f46833","block_type":"box","text":"To be effective and engaged, directors need to have the time and energy to commit to the role. In our view, an","page_number":203,"box":{"x":101,"y":499,"width":784,"height":11}},{"id":"3bcdf536-530d-4637-a690-b97799b7b85c","block_type":"box","text":"effective board will assess the ability of its members to maintain an appropriate focus on board matters and the","page_number":203,"box":{"x":69,"y":513,"width":801,"height":12}},{"id":"f9381eb2-dcd2-4bac-b237-577dcc6c273c","block_type":"box","text":"company taking into consideration competing responsibilities. We recognize that board leadership roles vary across","page_number":203,"box":{"x":69,"y":529,"width":823,"height":11}},{"id":"2ea40ee4-853a-4048-a5a0-2188b218907f","block_type":"box","text":"markets in responsibilities and required time commitment but note that they are generally more intensive than a","page_number":203,"box":{"x":69,"y":543,"width":800,"height":11}},{"id":"794c13e8-6429-47e6-bdf8-ff599bea8227","block_type":"box","text":"standard directorship. We will take local norms and practices into consideration when making our voting","page_number":203,"box":{"x":69,"y":558,"width":741,"height":11}},{"id":"174a9fe9-36a0-49ca-b416-a7ee9128da0e","block_type":"box","text":"determinations across markets.","page_number":203,"box":{"x":69,"y":573,"width":226,"height":9}},{"id":"1e15b582-01b3-4889-a789-0469f3160f72","block_type":"box","text":"We may vote against the election of directors who do not seem to have sufficient capacity to effectively fulfill","page_number":203,"box":{"x":101,"y":592,"width":776,"height":11}},{"id":"ebc755d6-f619-4c8f-a41b-eb5326ac00fd","block_type":"box","text":"their duties to the board and company.","page_number":203,"box":{"x":68,"y":607,"width":275,"height":11}},{"id":"b1340f9a-c393-411a-97e1-d90822044bb4","block_type":"box","text":"Director elections","page_number":203,"box":{"x":70,"y":629,"width":124,"height":9}},{"id":"bf01027b-e4c2-4889-925b-839923d4c3f2","block_type":"box","text":"Regular election of directors, ideally annually, suppor ts director accountability to shareholders. A classified board","page_number":203,"box":{"x":102,"y":647,"width":805,"height":12}},{"id":"8801a62c-5fac-47c4-a771-43809b00b2a2","block_type":"box","text":"structure","page_number":203,"box":{"x":69,"y":663,"width":63,"height":8}},{"id":"34d8493a-fc73-4228-aa3d-9ab4ab96006c","block_type":"box","text":"8","page_number":203,"box":{"x":133,"y":663,"width":4,"height":4}},{"id":"1764d8c8-c760-4581-ab80-8f672af0b215","block_type":"box","text":"may be justified by a company when it needs consistency and stability during a time of transition, or on the","page_number":203,"box":{"x":144,"y":662,"width":761,"height":12}},{"id":"e9e74017-89af-464e-8dc8-0e700c73d560","block_type":"box","text":"basis of its business model (","page_number":203,"box":{"x":69,"y":677,"width":206,"height":11}},{"id":"77a5f6e6-454b-4385-b38a-e6757a0ee5a5","block_type":"box","text":"e.g.","page_number":203,"box":{"x":277,"y":679,"width":24,"height":10}},{"id":"2a667631-9a52-4609-afdb-17851e76cda8","block_type":"box","text":", a non-operating company such as closed-end funds).","page_number":203,"box":{"x":304,"y":677,"width":382,"height":12}},{"id":"6fd80365-5bf3-4628-a085-c6faa5955b3f","block_type":"box","text":"Shareholders should have the oppor tunity to evaluate nominated directors individually rather than in bundled","page_number":203,"box":{"x":102,"y":696,"width":774,"height":11}},{"id":"9afa594d-d9ef-48b7-8dc4-d9c8e3171c70","block_type":"box","text":"slates. We look to companies to provide sufficient information on each director standing for election so that","page_number":203,"box":{"x":69,"y":711,"width":770,"height":11}},{"id":"3934717c-80c1-48b1-a6fb-bb85bd79bad1","block_type":"box","text":"shareholders can assess their capabilities and suitability. We will generally not suppor t the election of directors","page_number":203,"box":{"x":69,"y":726,"width":794,"height":11}},{"id":"281f32e8-e9b9-4553-85fa-fbd11c65afc5","block_type":"box","text":"whose names and biographical details have not been disclosed sufficiently in advance of the shareholder meeting.","page_number":203,"box":{"x":68,"y":740,"width":818,"height":12}},{"id":"46e7c310-5f2e-4773-8e20-054dc9d05e44","block_type":"box","text":"Each director’s appointment should be dependent on receiving a simple majority of the votes cast at the","page_number":203,"box":{"x":102,"y":759,"width":743,"height":11}},{"id":"3920bc4c-3878-41b2-802b-8ae17515f3a0","block_type":"box","text":"shareholder meeting. Where a company’s practices differ, we look to the board to provide a detailed explanation as","page_number":203,"box":{"x":69,"y":774,"width":823,"height":11}},{"id":"e2f2f1ad-dc1a-4efc-a8af-594b0659930f","block_type":"box","text":"to how its approach best serves investors’ interests.","page_number":203,"box":{"x":68,"y":789,"width":377,"height":11}},{"id":"9c3bd6dd-2a46-4dcb-905e-be5184b99fbb","block_type":"box","text":"We may vote for shareholder or management proposals seeking to establish annual election of directors and/or","page_number":203,"box":{"x":101,"y":807,"width":798,"height":12}},{"id":"745e120c-e721-4cd3-9e4c-a8c41d9c37cc","block_type":"box","text":"a simple majority vote standard for director elections. We may vote against all the directors standing for election as","page_number":203,"box":{"x":69,"y":822,"width":822,"height":12}},{"id":"fa8abf35-ee93-4e20-825d-a6fdac7f6e41","block_type":"box","text":"par t of a single slate if we have concerns about the profile or per formance of an individual director.","page_number":203,"box":{"x":70,"y":837,"width":706,"height":12}},{"id":"a0c75e65-f8ac-448c-bbb6-3f77f51437c0","block_type":"box","text":"8","page_number":203,"box":{"x":69,"y":867,"width":4,"height":4}},{"id":"206782b8-42bb-40aa-955a-b17717a6ab3e","block_type":"box","text":"A classified board divides the directors into classes with different overlapping terms. As a result, only one class of","page_number":203,"box":{"x":78,"y":866,"width":818,"height":12}},{"id":"99d4e40d-aef7-4190-8bc9-f592454bc421","block_type":"box","text":"directors stands for election in any one year.","page_number":203,"box":{"x":69,"y":882,"width":315,"height":11}},{"id":"007d97cf-2609-44be-bcb1-e06b0a68a555","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":203,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"f2387345-7dff-402b-81b2-1da84fdb4df2","block_type":"box","text":"Global Engagement and Voting Guidelines | 7","page_number":203,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"ede2b221-4a6b-44fd-8ff8-60f79614c853","block_type":"box","text":"NM1026U-6033063-203/246","page_number":203,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"2f04f75b-bf65-43cd-bcc0-0d6e05ed8aa9","block_type":"box","text":"Committees","page_number":204,"box":{"x":70,"y":45,"width":84,"height":9}},{"id":"4cab6811-5651-45aa-a276-3eea263d41f4","block_type":"box","text":"Many boards establish committees to focus on specific responsibilities of the board such as audit and risk,","page_number":204,"box":{"x":102,"y":63,"width":766,"height":11}},{"id":"273bd1b6-9af3-4d8e-b197-d5960ea16084","block_type":"box","text":"governance and human capital, and executive compensation, amongst other matters. We do not prescribe to","page_number":204,"box":{"x":68,"y":78,"width":776,"height":11}},{"id":"3a4d7a58-56aa-414c-8c42-a9efe6c77610","block_type":"box","text":"companies what committees they should establish, but we seek to understand the board’s rationale for the","page_number":204,"box":{"x":69,"y":93,"width":766,"height":11}},{"id":"41c62c68-7d5c-48c1-a28c-3f5d7f17d0d1","block_type":"box","text":"committee structure it determines is appropriate. We note that, in some markets, regulation requires such","page_number":204,"box":{"x":69,"y":108,"width":759,"height":11}},{"id":"9c2a0820-e9e0-4792-bacc-edde907a54c0","block_type":"box","text":"committees. The responsibilities of each committee should be clear, and the board should ensure that all critical","page_number":204,"box":{"x":69,"y":123,"width":804,"height":11}},{"id":"7dc0da80-3932-42c5-af53-aceca94ddcfe","block_type":"box","text":"matters are assigned either to the full board or to one of the committees. It is helpful to investor understanding when","page_number":204,"box":{"x":69,"y":138,"width":837,"height":11}},{"id":"50244a7c-b57d-45ea-8221-f737f9505a36","block_type":"box","text":"the board discloses the structure, membership, propor tion of independent directors, and responsibilities of each","page_number":204,"box":{"x":68,"y":152,"width":806,"height":11}},{"id":"9912112c-a0e1-4c15-b29a-6934d8c170c6","block_type":"box","text":"committee. The responsibilities we typically see assigned to the three most common committees include:","page_number":204,"box":{"x":69,"y":168,"width":752,"height":11}},{"id":"87ddd389-5df9-4daa-b850-38e7a4ed4ec3","block_type":"box","text":"•","page_number":204,"box":{"x":69,"y":188,"width":6,"height":4}},{"id":"7f79d50f-30d4-4d7f-a7e9-edc3489966f2","block_type":"box","text":"Audit and risk – oversight responsibilities for the integrity of financial repor ting, risk management and","page_number":204,"box":{"x":101,"y":185,"width":722,"height":11}},{"id":"f3f101e8-e305-4616-8222-e1c54cd0f912","block_type":"box","text":"compliance with legal and regulatory requirements; may also play an oversight role in relation to the internal","page_number":204,"box":{"x":101,"y":200,"width":771,"height":11}},{"id":"133cb498-6ae8-413c-9b2f-2f9592997c74","block_type":"box","text":"audit function and whistleblowing mechanisms.","page_number":204,"box":{"x":102,"y":214,"width":335,"height":12}},{"id":"9b64a86e-baf5-4f96-9a71-8a563d6ae24d","block_type":"box","text":"•","page_number":204,"box":{"x":69,"y":235,"width":6,"height":4}},{"id":"07c3d0f9-3c7f-4097-a901-c5f92cf70146","block_type":"box","text":"Nominating, governance and human capital – oversight responsibilities for corporate governance principles and","page_number":204,"box":{"x":102,"y":232,"width":790,"height":11}},{"id":"5010071b-7a5c-42ee-b46a-9e5d41cfccaf","block_type":"box","text":"practices of the company, including the periodic review of board per formance; responsibility for succession","page_number":204,"box":{"x":102,"y":247,"width":761,"height":11}},{"id":"053dd82f-298f-44f3-9064-f1a9fc6fe91b","block_type":"box","text":"planning for CEO and key board roles, as well as the director appointment process; may also have oversight","page_number":204,"box":{"x":102,"y":262,"width":769,"height":11}},{"id":"3940f88b-3f3c-454a-be56-1813859c1bcd","block_type":"box","text":"responsibilities for human capital management strategies, including corporate culture and purpose.","page_number":204,"box":{"x":102,"y":276,"width":707,"height":12}},{"id":"2519ae04-8ee7-43d5-8ab1-198072b7158d","block_type":"box","text":"•","page_number":204,"box":{"x":69,"y":297,"width":6,"height":4}},{"id":"b2dca4d3-17db-4f88-97d4-191a3ae7e701","block_type":"box","text":"Executive compensation – determines the compensation policies and programs for the CEO and other executive","page_number":204,"box":{"x":102,"y":294,"width":796,"height":11}},{"id":"cf05a2c0-9ac9-410c-9052-55204d6e6db1","block_type":"box","text":"officers, approves annual awards and payments under the policies; may also have oversight responsibilities for","page_number":204,"box":{"x":102,"y":309,"width":793,"height":11}},{"id":"3e37625f-0e63-4d3e-975b-7d36b44c075c","block_type":"box","text":"firm-wide compensation policies.","page_number":204,"box":{"x":101,"y":323,"width":232,"height":11}},{"id":"d9ad806c-baff-4222-8be7-797886036f5a","block_type":"box","text":"We may vote against the election of the chair of the committee or other directors serving as committee members","page_number":204,"box":{"x":101,"y":342,"width":807,"height":11}},{"id":"8014dac8-7865-4144-8eed-d5f176ee3875","block_type":"box","text":"to convey concerns about how a committee has under taken its responsibilities. We may vote against the election of","page_number":204,"box":{"x":68,"y":357,"width":828,"height":11}},{"id":"36ec10ae-f856-4ebf-86b8-a44531f0cb06","block_type":"box","text":"the most senior non-executive director if there is not a clearly disclosed approach to board committees.","page_number":204,"box":{"x":68,"y":372,"width":738,"height":11}},{"id":"ca48daec-65e9-45e3-b600-a9c4a3689537","block_type":"box","text":"Board and director evaluation","page_number":204,"box":{"x":70,"y":395,"width":209,"height":8}},{"id":"fcf8c808-e307-4401-a3dc-9a5a51b47965","block_type":"box","text":"We consider it best practice for companies to conduct an annual review of the per formance of the board, the","page_number":204,"box":{"x":101,"y":413,"width":776,"height":11}},{"id":"c5bfa1ca-e7ac-4d61-ab54-fc0bcb52c723","block_type":"box","text":"committees, the chair and individual directors. Periodically, this review could be under taken by an independent third","page_number":204,"box":{"x":69,"y":428,"width":825,"height":11}},{"id":"d958e973-db60-48b5-a248-50217c8d952c","block_type":"box","text":"par ty able to bring objective perspectives to the board on governance and per formance. We encourage companies to","page_number":204,"box":{"x":70,"y":443,"width":831,"height":11}},{"id":"058e4032-81e6-40bc-a621-a5e2f60e5caa","block_type":"box","text":"disclose their approach to and the objectives of evaluations, including any changes made to the board’s approach as","page_number":204,"box":{"x":69,"y":458,"width":835,"height":11}},{"id":"0d7fc45b-1d16-4c07-926f-dce24b4280eb","block_type":"box","text":"a result.","page_number":204,"box":{"x":69,"y":473,"width":57,"height":8}},{"id":"3df5242e-e67d-4cb0-bfcf-7a35f1ce8a05","block_type":"box","text":"Access to independent advice","page_number":204,"box":{"x":68,"y":495,"width":214,"height":11}},{"id":"95654668-b620-4c68-8582-555f4cf1114f","block_type":"box","text":"To suppor t the directors in effectively fulfilling their duties to the company and shareholders, they should have","page_number":204,"box":{"x":101,"y":513,"width":786,"height":12}},{"id":"e6dc90a5-e33c-43fa-8fe8-8090f271bb06","block_type":"box","text":"access to independent advice. In cer tain circumstances, it may be helpful to boards to retain independent third","page_number":204,"box":{"x":69,"y":528,"width":793,"height":11}},{"id":"dfc413f9-1de6-43ce-b63c-af8ea5dc8354","block_type":"box","text":"par ties to advise on critical matters. These might include new industry developments such as emergent and","page_number":204,"box":{"x":70,"y":543,"width":770,"height":11}},{"id":"066f550e-65e0-4edb-ae5f-9610fb514f5f","block_type":"box","text":"disruptive technology, operating events with material consequences for the company’s reputation and/or","page_number":204,"box":{"x":69,"y":558,"width":746,"height":11}},{"id":"8ce23e1f-392e-4614-8993-0d28afe90900","block_type":"box","text":"per formance, or significant transactions. Board committees may similarly retain third par ties to advise them on","page_number":204,"box":{"x":70,"y":573,"width":793,"height":11}},{"id":"cdc6f8d9-b0e9-4327-b5b8-58038bb5baca","block_type":"box","text":"specialist matters such as audit, compensation and succession planning.","page_number":204,"box":{"x":69,"y":588,"width":524,"height":11}},{"id":"8d8c1642-668b-4938-836b-b129dcd16a78","block_type":"box","text":"EXECUTIVE COMPENSATION","page_number":204,"box":{"x":385,"y":618,"width":207,"height":9}},{"id":"9618d555-7fda-4ae6-8763-04bd59de2a5a","block_type":"box","text":"Boards play an impor tant role in establishing compensation arrangements that enable the company to recruit,","page_number":204,"box":{"x":102,"y":637,"width":784,"height":11}},{"id":"28cc7b6a-fc4d-477a-a946-a9ce317031d2","block_type":"box","text":"retain and reward the caliber of executive management necessary to lead and operate the company to deliver","page_number":204,"box":{"x":69,"y":652,"width":782,"height":11}},{"id":"70b3eded-f7e4-4a07-b80f-d9b88c724aab","block_type":"box","text":"superior financial returns over time. We focus on alignment between variable pay and a company’s financial","page_number":204,"box":{"x":69,"y":666,"width":766,"height":12}},{"id":"a224f45c-b0b1-4f1c-b288-3ecf5c84edc8","block_type":"box","text":"per formance.","page_number":204,"box":{"x":70,"y":681,"width":93,"height":11}},{"id":"cefd77f5-5b0f-4568-a1dd-c42da97e4f0b","block_type":"box","text":"Generally, executive compensation arrangements have four components: base salary, annual bonus that rewards","page_number":204,"box":{"x":102,"y":700,"width":805,"height":11}},{"id":"390c0793-ff80-4847-a10e-3eb4c877f364","block_type":"box","text":"per formance against shor t-term metrics, incentives – most often share-based that reward per formance against long","page_number":204,"box":{"x":70,"y":715,"width":831,"height":11}},{"id":"5ef4b236-2d24-40b5-91b5-73b4da8d0f47","block_type":"box","text":"term metrics, and pensions and benefits. In our observation, base salary, pensions and benefits are largely set","page_number":204,"box":{"x":68,"y":730,"width":798,"height":11}},{"id":"34377d5d-9dff-4316-b3a6-caad32fc132e","block_type":"box","text":"relative to market norms and benchmarks. The annual bonus and share-based incentive, or variable pay plans, tend","page_number":204,"box":{"x":69,"y":745,"width":824,"height":11}},{"id":"94c57cff-9faa-4e75-8b21-716d204e8095","block_type":"box","text":"to be tailored to the company, its sector and long-term strategy, as well as the individuals the board is seeking to","page_number":204,"box":{"x":68,"y":760,"width":807,"height":11}},{"id":"3e6a0138-f524-4cc4-b419-18f1410633b4","block_type":"box","text":"recruit and motivate.","page_number":204,"box":{"x":69,"y":774,"width":146,"height":9}},{"id":"4db853b2-d810-4271-845c-98aa881bffe0","block_type":"box","text":"Recognizing the unique circumstances of each company, we determine whether to suppor t a company’s","page_number":204,"box":{"x":102,"y":793,"width":739,"height":11}},{"id":"da903f5d-63fd-468c-b834-58dae4571c64","block_type":"box","text":"approach to executive compensation on a case-by-case basis. We rely on companies providing sufficient quantitative","page_number":204,"box":{"x":69,"y":808,"width":831,"height":11}},{"id":"7d831fec-8aa2-4684-85f2-bd91a4e9cc04","block_type":"box","text":"and qualitative information in their disclosures to enable shareholders to understand the compensation","page_number":204,"box":{"x":69,"y":823,"width":737,"height":11}},{"id":"903eb4f1-e8d9-4c25-a7a4-ae6d0abd32cd","block_type":"box","text":"arrangements and assess the alignment with investors’ interests. Features we look for in compensation","page_number":204,"box":{"x":69,"y":837,"width":741,"height":12}},{"id":"5d244ea5-48c7-4c00-a94f-2de32fdf1e70","block_type":"box","text":"arrangements include:","page_number":204,"box":{"x":69,"y":853,"width":157,"height":11}},{"id":"b46ef2c5-556e-432e-b7e8-7f2dcb10210d","block_type":"box","text":"•","page_number":204,"box":{"x":69,"y":873,"width":6,"height":4}},{"id":"5fd91f27-f5a8-4d36-96f7-1654733347ef","block_type":"box","text":"Fixed pay components, including base salary, benefits and prerequisites that are appropriate in the context of","page_number":204,"box":{"x":102,"y":870,"width":783,"height":11}},{"id":"35727cb3-b033-4599-b919-274eb6e3f52f","block_type":"box","text":"the company’s size, sector and market.","page_number":204,"box":{"x":101,"y":885,"width":280,"height":11}},{"id":"b90f6b02-7275-43bd-9b62-988de8155769","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":204,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"141f81df-6a39-4460-b232-7bcb701f6741","block_type":"box","text":"Global Engagement and Voting Guidelines | 8","page_number":204,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"6d5a7e50-05f6-47f1-83ff-51db6e1e9e0e","block_type":"box","text":"NM1026U-6033063-204/246","page_number":204,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"9d74291c-cea9-44d3-a064-98cf427342eb","block_type":"box","text":"•","page_number":205,"box":{"x":69,"y":48,"width":6,"height":4}},{"id":"acf01810-ca5b-4742-9d16-6a8ff32eb925","block_type":"box","text":"Variable pay subject to per formance metrics that are closely linked to the company’s shor t- and long-term","page_number":205,"box":{"x":101,"y":45,"width":752,"height":11}},{"id":"6f7cbdd5-0ec9-48dd-973b-bab141ec9368","block_type":"box","text":"strategic objectives.","page_number":205,"box":{"x":102,"y":60,"width":140,"height":11}},{"id":"2baf77be-8127-4b28-9b70-00b62a7fcc96","block_type":"box","text":"•","page_number":205,"box":{"x":69,"y":80,"width":6,"height":4}},{"id":"b2414251-960a-4ff1-a628-7e8897651a08","block_type":"box","text":"Long-term incentives that motivate sustained per formance across a multi-year period.","page_number":205,"box":{"x":102,"y":77,"width":609,"height":11}},{"id":"586581c4-50e5-4249-9896-44fff44f6f95","block_type":"box","text":"•","page_number":205,"box":{"x":69,"y":97,"width":6,"height":5}},{"id":"4de37439-a620-48b5-98b7-106b3e16574c","block_type":"box","text":"A balance between fixed and variable pay, shor t- and long-term incentives, and specific instruments (cash and","page_number":205,"box":{"x":101,"y":94,"width":784,"height":12}},{"id":"9b4a8ea9-0696-4045-b4d6-85b3010080e3","block_type":"box","text":"equity awards) that promotes pay program durability and seldom necessitates one-off, discretionary payments.","page_number":205,"box":{"x":101,"y":109,"width":790,"height":11}},{"id":"d5d332e6-5c7d-49d8-b318-1d22747d994c","block_type":"box","text":"•","page_number":205,"box":{"x":69,"y":129,"width":6,"height":5}},{"id":"81257639-d01e-4209-be1c-86318ae8900c","block_type":"box","text":"Pay outcomes that are consistent with the returns to investors over the relevant time period.","page_number":205,"box":{"x":102,"y":127,"width":658,"height":11}},{"id":"263e04ae-8151-4250-9028-065fe2dada4b","block_type":"box","text":"•","page_number":205,"box":{"x":69,"y":147,"width":6,"height":4}},{"id":"46a0fc4c-6a77-4388-92d2-6635857d9a3b","block_type":"box","text":"Board discretion, if allowed within the variable pay arrangements, to be used sparingly, responsibly and","page_number":205,"box":{"x":102,"y":144,"width":735,"height":11}},{"id":"1f6edb25-c319-45ba-8995-4e990ee656bd","block_type":"box","text":"transparently.","page_number":205,"box":{"x":101,"y":159,"width":95,"height":11}},{"id":"6470d268-f4b2-48eb-b631-d72f6901a2c2","block_type":"box","text":"•","page_number":205,"box":{"x":69,"y":179,"width":6,"height":5}},{"id":"f60d1f46-30bb-4a68-abc9-31a4d6c6cf1e","block_type":"box","text":"A requirement, that par ticipants in long-term share-based incentive plans build a meaningful shareholding in the","page_number":205,"box":{"x":101,"y":176,"width":798,"height":11}},{"id":"b6de4060-8270-4701-ad83-da1516b9e9a8","block_type":"box","text":"company within a defined time period, as determined by the board or relevant board committee.","page_number":205,"box":{"x":101,"y":191,"width":683,"height":11}},{"id":"18f36345-11cb-4a66-a940-e0c855a5ae40","block_type":"box","text":"•","page_number":205,"box":{"x":69,"y":211,"width":6,"height":5}},{"id":"f95ee1e7-600d-4211-8a2f-12a6ca9a13e5","block_type":"box","text":"Change of control provisions that appropriately balance the interests of executives and shareholders.","page_number":205,"box":{"x":102,"y":208,"width":720,"height":12}},{"id":"b73ca370-2d2d-4579-8b8c-ab3d8909764f","block_type":"box","text":"•","page_number":205,"box":{"x":69,"y":229,"width":6,"height":4}},{"id":"2293ab03-01fa-4adf-bfe1-28ebd09d7899","block_type":"box","text":"Clawback or malus provisions that allow the company to recoup or hold back variable compensation from","page_number":205,"box":{"x":102,"y":226,"width":747,"height":11}},{"id":"9392243f-46f0-4db8-9dd1-e6b3dfe26b94","block_type":"box","text":"individuals whose awards were based on fraudulent activities, misstated financial repor ts, or executive","page_number":205,"box":{"x":102,"y":241,"width":733,"height":11}},{"id":"59a7fb3f-ddce-4648-a287-32c8c82d1fe6","block_type":"box","text":"misconduct.","page_number":205,"box":{"x":102,"y":256,"width":84,"height":8}},{"id":"86a13438-03f8-416a-8a9c-d7d54cc2bc13","block_type":"box","text":"•","page_number":205,"box":{"x":69,"y":276,"width":6,"height":4}},{"id":"cc2cb8bf-698d-46e7-93b1-f4ae32aee788","block_type":"box","text":"Severance arrangements that protect the company’s interests but do not cost more than is contractual.","page_number":205,"box":{"x":102,"y":273,"width":738,"height":11}},{"id":"2df58fdd-62d8-4edc-b753-6f7afb918b62","block_type":"box","text":"We may vote against proposals to introduce new share-based incentives, approve existing policies or plans, or","page_number":205,"box":{"x":101,"y":292,"width":787,"height":11}},{"id":"7709e7dc-8be3-4e86-8602-a3eeb92e48de","block_type":"box","text":"approve the compensation repor t where we do not see alignment between executive compensation arrangements","page_number":205,"box":{"x":69,"y":307,"width":810,"height":11}},{"id":"6cd29ae4-2d04-40e4-a4dc-d3a94f73354d","block_type":"box","text":"and our clients’ financial interests. When there is not an alternative, or where there have been multi-year issues with","page_number":205,"box":{"x":69,"y":321,"width":831,"height":11}},{"id":"f1381277-97ce-46a8-a212-b18823fe68c1","block_type":"box","text":"compensation misaligned with per formance, we may vote against the election of the chair of the responsible","page_number":205,"box":{"x":69,"y":336,"width":775,"height":11}},{"id":"242e8ae9-1a08-440c-bab6-f02055686273","block_type":"box","text":"committee, or the most senior independent director.","page_number":205,"box":{"x":69,"y":351,"width":371,"height":11}},{"id":"dea0854c-7c15-4934-b777-b547f0871606","block_type":"box","text":"NON-EXECUTIVE DIRECTOR COMPENSATION","page_number":205,"box":{"x":326,"y":381,"width":325,"height":9}},{"id":"eb24ea34-c9ea-45ea-a106-49b427ffaefb","block_type":"box","text":"Companies generally pay non-executive directors an annual retainer or fee in cash, shares or a combination of","page_number":205,"box":{"x":102,"y":400,"width":785,"height":11}},{"id":"390c701b-e6b8-4208-a01b-a3aeb24d660c","block_type":"box","text":"the two. Some companies also pay additional fees for service on board committees or in board leadership roles. We","page_number":205,"box":{"x":68,"y":415,"width":831,"height":11}},{"id":"612d06b7-8a8d-4100-8ce5-d13a0e4472ca","block_type":"box","text":"do not suppor t non-executive directors par ticipating in per formance-based incentive plans as doing so may create a","page_number":205,"box":{"x":69,"y":430,"width":825,"height":11}},{"id":"a2041077-481a-443d-a0e4-6ac21785f57b","block_type":"box","text":"conflict of interest and undermine their independence from management, whom they oversee.","page_number":205,"box":{"x":69,"y":444,"width":668,"height":12}},{"id":"b047f318-956b-43b9-b651-3580369c6cea","block_type":"box","text":"CAPITAL STRUCTURE","page_number":205,"box":{"x":411,"y":475,"width":156,"height":8}},{"id":"0e6f6972-8dd3-4fec-8131-bdb5ad451896","block_type":"box","text":"Boards are responsible for ensuring senior executive leadership has established a capital strategy that achieves","page_number":205,"box":{"x":102,"y":493,"width":800,"height":12}},{"id":"5f49a91d-121f-4a0a-914d-3d480ec1dc5a","block_type":"box","text":"appropriate capital allocation in suppor t of long-term financial resilience.","page_number":205,"box":{"x":69,"y":508,"width":516,"height":11}},{"id":"12a70a16-2370-4952-98f9-d8d95b9b0d68","block_type":"box","text":"Where company practices diverge from those set out below, we look for companies to disclose why they view","page_number":205,"box":{"x":101,"y":527,"width":776,"height":11}},{"id":"5358b629-5dd5-44b2-922f-cdad555a9965","block_type":"box","text":"these practices to be aligned with shareholders’ interests. We may vote against management proposals seeking","page_number":205,"box":{"x":68,"y":542,"width":803,"height":11}},{"id":"ef9f3997-a8cd-496b-85ae-1464a319553a","block_type":"box","text":"capital-related authorities, or the election of the most senior independent director, if we have concerns about a","page_number":205,"box":{"x":69,"y":557,"width":790,"height":11}},{"id":"7d8740ae-bc9a-4a86-8625-d2a68c18de25","block_type":"box","text":"company’s approach. We may also suppor t a shareholder proposal seeking conversion of shares with differentiated","page_number":205,"box":{"x":69,"y":571,"width":825,"height":12}},{"id":"cd0b8261-728c-47ed-b6b7-17bf414a1a61","block_type":"box","text":"voting rights to a one-share, one-vote standard.","page_number":205,"box":{"x":68,"y":587,"width":336,"height":11}},{"id":"4f05af9b-ce6d-43ce-aa2f-382367520077","block_type":"box","text":"Share issuance","page_number":205,"box":{"x":68,"y":609,"width":111,"height":9}},{"id":"b9a53b87-627f-42db-a44c-8c5762724404","block_type":"box","text":"We assess requests for share issuance for par ticular transactions on a case-by-case basis. We will generally","page_number":205,"box":{"x":101,"y":627,"width":776,"height":12}},{"id":"00394ee2-e1f4-453c-b66d-89ae927ff7a0","block_type":"box","text":"suppor t authorities to issue shares when subject to pre-emptive rights, and up to 20% absent pre-emptive rights. We","page_number":205,"box":{"x":69,"y":642,"width":832,"height":12}},{"id":"6e15fc49-b0bf-495f-a060-33ab50a6cfbd","block_type":"box","text":"consider it good practice for companies to seek regular approval of these authorities to allow shareholders to take","page_number":205,"box":{"x":69,"y":657,"width":815,"height":11}},{"id":"c0290905-0b4b-4ae9-b48f-7b978ec82973","block_type":"box","text":"into consideration how prior authorities were used, as well as the current circumstances of the company and the","page_number":205,"box":{"x":70,"y":672,"width":802,"height":11}},{"id":"0ff044cf-0139-44a9-9105-3b22f8e7608e","block_type":"box","text":"market environment.","page_number":205,"box":{"x":69,"y":687,"width":145,"height":9}},{"id":"c4d54ce8-afee-4254-8992-67732929f010","block_type":"box","text":"Share buybacks","page_number":205,"box":{"x":68,"y":709,"width":116,"height":11}},{"id":"a086825f-e213-4f3c-ab46-14c5734e6d2b","block_type":"box","text":"We assess share buyback proposals in the context of the company’s disclosed capital management strategy and","page_number":205,"box":{"x":101,"y":728,"width":806,"height":11}},{"id":"5f82e0ec-e33b-47cd-92dc-1b9da40d9f63","block_type":"box","text":"management’s determination of the appropriate balance between investment that suppor ts the long-term growth of","page_number":205,"box":{"x":69,"y":743,"width":823,"height":11}},{"id":"c817fe94-c196-4fab-8b01-5c235898c87c","block_type":"box","text":"the company and returning cash to investors. We also take into consideration the effect of a buyback program on the","page_number":205,"box":{"x":68,"y":758,"width":836,"height":11}},{"id":"6698a0fa-6aee-4d15-8c81-baee1cb38f76","block_type":"box","text":"company’s balance sheet and executive compensation arrangements and the price at which shares are repurchased","page_number":205,"box":{"x":69,"y":773,"width":830,"height":11}},{"id":"ad0df87a-62b9-4ad4-a43c-9c5c6ed35f05","block_type":"box","text":"relative to market price. We consider it good practice for companies to seek regular approval of these authorities to","page_number":205,"box":{"x":69,"y":787,"width":822,"height":12}},{"id":"f34876d2-c71e-45c8-822c-024c4024f1ee","block_type":"box","text":"allow shareholders to take into consideration how prior authorities were used, as well as the current circumstances","page_number":205,"box":{"x":69,"y":802,"width":823,"height":11}},{"id":"1c95641e-8abd-4367-a1f9-c1bb7176c76f","block_type":"box","text":"of the company and the market environment.","page_number":205,"box":{"x":69,"y":817,"width":319,"height":11}},{"id":"a155131c-9109-4e2f-9e7c-25739586aa34","block_type":"box","text":"Dividends","page_number":205,"box":{"x":69,"y":840,"width":69,"height":8}},{"id":"2abc0360-7c45-43cc-8426-a8b9dcade663","block_type":"box","text":"We generally defer to management and the board on dividend policy but may engage to seek fur ther clarification","page_number":205,"box":{"x":101,"y":858,"width":799,"height":11}},{"id":"cdc9c327-a6bf-43ad-9d8c-2fdeb4c5156f","block_type":"box","text":"where a proposed dividend appears out of line with the company’s financial position.","page_number":205,"box":{"x":68,"y":873,"width":604,"height":11}},{"id":"31da06d9-17d0-4991-8801-ffbf94cc08af","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":205,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"86cf8e5e-4e1a-4f07-bfb9-d308b772d025","block_type":"box","text":"Global Engagement and Voting Guidelines | 9","page_number":205,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"20d8b3cb-089e-4684-8481-42f9ceca7d97","block_type":"box","text":"NM1026U-6033063-205/246","page_number":205,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"703ab524-24a4-4c2c-8beb-04f4968c5f92","block_type":"box","text":"Differentiated voting rights","page_number":206,"box":{"x":69,"y":45,"width":196,"height":11}},{"id":"1f0b9727-d3ad-4574-a316-0c64c466ea33","block_type":"box","text":"We prefer companies to adopt a one-share, one-vote structure for share classes with the same economic","page_number":206,"box":{"x":101,"y":63,"width":750,"height":11}},{"id":"b8290e9a-01e3-45df-86e9-4d23463b08f9","block_type":"box","text":"exposure. Cer tain companies, par ticularly those new to public markets, could make the case to adopt a","page_number":206,"box":{"x":69,"y":78,"width":740,"height":11}},{"id":"cd87f15d-4e09-4440-ad30-930fd182a7e3","block_type":"box","text":"differentiated voting rights structure, or dual class stock. In those situations, we encourage companies to evaluate","page_number":206,"box":{"x":69,"y":93,"width":819,"height":11}},{"id":"94aec34e-5c0f-4638-a5e7-19c7d12fd55d","block_type":"box","text":"and seek approval for their capital structure on a periodic basis.","page_number":206,"box":{"x":69,"y":108,"width":456,"height":11}},{"id":"3bd88c64-4f97-4270-80d3-5c054afec731","block_type":"box","text":"TRANSACTIONS AND SPECIAL SITUATIONS","page_number":206,"box":{"x":332,"y":138,"width":314,"height":9}},{"id":"418b107d-eeee-49c4-80a9-9aece20458eb","block_type":"box","text":"We monitor developments in transactions and special situations closely and under take our own detailed","page_number":206,"box":{"x":101,"y":157,"width":743,"height":11}},{"id":"6e3dec3a-8dca-48c4-b067-9072effe913d","block_type":"box","text":"analyses of proposals.","page_number":206,"box":{"x":69,"y":172,"width":159,"height":11}},{"id":"6ceae9d2-90af-465d-8029-bcc28c13bb14","block_type":"box","text":"Mergers and acquisitions","page_number":206,"box":{"x":69,"y":194,"width":184,"height":11}},{"id":"cfc4bedc-49aa-478a-b4d0-c3beff13cbee","block_type":"box","text":"We evaluate proposed mergers or acquisitions by assessing the financial outcome for our clients as minority","page_number":206,"box":{"x":101,"y":213,"width":775,"height":11}},{"id":"90e9d7e9-3a8d-44dc-9677-bc9462369840","block_type":"box","text":"shareholders. Management should provide an assessment of the proposed transaction’s strategic and financial","page_number":206,"box":{"x":69,"y":228,"width":797,"height":11}},{"id":"85d67718-83cf-4dab-a47d-f33a65d96cf6","block_type":"box","text":"rationale, along with its execution and operational risks. We review each transaction independently based on these","page_number":206,"box":{"x":69,"y":243,"width":819,"height":11}},{"id":"9ef34ebf-3aa4-459a-88ac-872c935f00dd","block_type":"box","text":"factors and the degree to which the transaction enhances shareholder value. The board might consider establishing","page_number":206,"box":{"x":68,"y":257,"width":827,"height":12}},{"id":"a048cd17-38ba-4b4b-aa40-a425e399071f","block_type":"box","text":"an ad hoc transaction committee to under take an independent assessment of a significant merger or acquisition, in","page_number":206,"box":{"x":69,"y":272,"width":827,"height":11}},{"id":"f97b4df2-7890-4231-840e-9b4b42e4e97e","block_type":"box","text":"advance of making its recommendation to shareholders.","page_number":206,"box":{"x":69,"y":287,"width":400,"height":11}},{"id":"42f691a8-fb77-4940-89b6-061ac9ce3623","block_type":"box","text":"We will vote against transactions that, in our assessment, do not advance our clients’ financial interests.","page_number":206,"box":{"x":101,"y":306,"width":749,"height":11}},{"id":"4d0feb3a-c686-4f6a-9315-815096898002","block_type":"box","text":"Anti-takeover defenses","page_number":206,"box":{"x":68,"y":328,"width":167,"height":9}},{"id":"9d3d7768-941f-4049-9969-a2cea1b6a189","block_type":"box","text":"In principle, we do not suppor t companies using anti-takeover defenses, also known as poison pills or","page_number":206,"box":{"x":102,"y":347,"width":727,"height":11}},{"id":"ac2318fa-bc0b-46f6-bf03-ee5c84dc8739","block_type":"box","text":"shareholder rights plans, as they can entrench management and boards which have not delivered long-term","page_number":206,"box":{"x":69,"y":362,"width":766,"height":11}},{"id":"d4e3ec57-8f53-42b6-aa3b-9cb2cf568921","block_type":"box","text":"shareholder value. By exception, a poison pill may be suppor ted if its purpose is to delay a takeover that is","page_number":206,"box":{"x":69,"y":376,"width":763,"height":12}},{"id":"b8d55983-7736-48ad-8d07-2135cbefdffb","block_type":"box","text":"considered sub-optimal and enable management to seek an improved offer. Similarly, management could make the","page_number":206,"box":{"x":69,"y":391,"width":821,"height":12}},{"id":"ab0794dc-b7ae-46c0-b55b-09c0969e1ea0","block_type":"box","text":"case to use a poison pill to block a shareholder activism campaign that may be counter to the interests of other","page_number":206,"box":{"x":69,"y":406,"width":799,"height":11}},{"id":"f776f8fb-2da4-4835-ba09-c9856853261d","block_type":"box","text":"investors. Defense mechanisms introduced in these circumstances should be limited in term and threshold, and also","page_number":206,"box":{"x":70,"y":421,"width":836,"height":11}},{"id":"f8df067b-da44-418b-9ef7-45d9eeacdaef","block_type":"box","text":"be closely monitored by the independent members of the board. We consider it good practice for companies to put to","page_number":206,"box":{"x":69,"y":436,"width":835,"height":11}},{"id":"c68cd2a9-a31f-480f-9cf1-0265ecc07260","block_type":"box","text":"a shareholder vote any mechanisms expected to be in place for more than 12 months.","page_number":206,"box":{"x":69,"y":451,"width":616,"height":11}},{"id":"4f4f991d-16bf-4cfd-817d-ff38cab48b44","block_type":"box","text":"Shareholder activism","page_number":206,"box":{"x":68,"y":473,"width":153,"height":9}},{"id":"949a6be7-f7df-4c63-8024-6a4fdb3ea36d","block_type":"box","text":"When companies are the focus of an activism campaign, we may communicate with the activist to understand","page_number":206,"box":{"x":101,"y":492,"width":783,"height":11}},{"id":"590e8350-d17c-46dd-9975-8a3c6e77fda2","block_type":"box","text":"their analysis and objectives, once they have publicly disclosed their campaign. We may also engage with company","page_number":206,"box":{"x":68,"y":507,"width":819,"height":11}},{"id":"29539767-3152-4a07-9bdc-56da58065155","block_type":"box","text":"management and possibly board members, especially those the activist may be seeking to replace. In our","page_number":206,"box":{"x":69,"y":522,"width":755,"height":11}},{"id":"c3571d61-89cc-420b-8de4-96b57476b986","block_type":"box","text":"assessment, we evaluate various factors, including the concerns raised by the activist and the case for change; the","page_number":206,"box":{"x":69,"y":536,"width":824,"height":12}},{"id":"32ac1431-78ca-4fc3-8e7c-53492f2a773f","block_type":"box","text":"quality of both the activist’s and management’s plans; and the qualifications of each par ty’s candidates. We evaluate","page_number":206,"box":{"x":69,"y":551,"width":839,"height":12}},{"id":"0660700c-9b9e-4514-8977-5a4ab32d2f11","block_type":"box","text":"each contested situation by assessing the potential financial outcome for our clients as minority shareholders.","page_number":206,"box":{"x":69,"y":566,"width":788,"height":11}},{"id":"ca2f495a-b7cb-4bba-89ae-9f9bcf3250f8","block_type":"box","text":"We may suppor t board candidates nominated by a shareholder activist if BAIS, in its independent judgment, or","page_number":206,"box":{"x":101,"y":585,"width":789,"height":11}},{"id":"971ab85f-cd00-4b3c-80fb-fd575d13c138","block_type":"box","text":"the relevant por tfolio manager has determined that there is a case for change to enhance shareholder value, or if the","page_number":206,"box":{"x":68,"y":600,"width":839,"height":11}},{"id":"5a5d53b3-c652-499b-bbad-ee9e984315ff","block_type":"box","text":"incumbent board members do not demonstrate the relevant skills and exper tise or have a poor track record of","page_number":206,"box":{"x":70,"y":614,"width":786,"height":11}},{"id":"fd9a8793-6244-46b8-af64-e1d0effa3fc8","block_type":"box","text":"protecting shareholders’ interests.","page_number":206,"box":{"x":70,"y":630,"width":244,"height":11}},{"id":"8fb1a775-1975-47fb-b241-dc15d13b6422","block_type":"box","text":"Significant shareholders and related party transactions","page_number":206,"box":{"x":68,"y":652,"width":403,"height":11}},{"id":"cdec059e-1feb-4319-9cac-42424b99189c","block_type":"box","text":"Boards of companies with affiliated shareholders or directors should give equitable consideration to the","page_number":206,"box":{"x":102,"y":670,"width":740,"height":12}},{"id":"01bb12e6-5aa5-4f48-8b75-001487413633","block_type":"box","text":"interests of all shareholders when evaluating related par ty transactions.","page_number":206,"box":{"x":70,"y":685,"width":511,"height":12}},{"id":"7f6013ad-37bc-4770-a9a5-a2ec28bf5b62","block_type":"box","text":"We consider it good practice for transactions with related par ties, such as significant shareholders or companies","page_number":206,"box":{"x":101,"y":704,"width":805,"height":11}},{"id":"ea4e7bca-f341-4892-bbc2-0447466c3298","block_type":"box","text":"affiliated with the public company, to be disclosed in detail and conducted on terms similar to what would objectively","page_number":206,"box":{"x":69,"y":719,"width":832,"height":11}},{"id":"b179dc1a-632e-4cc3-948e-048fe475a2a6","block_type":"box","text":"have been agreed with a non-related par ty. In our view, such transactions should be reviewed and approved by the","page_number":206,"box":{"x":69,"y":734,"width":812,"height":11}},{"id":"5e017f13-cefb-404f-bba8-45dafd05fe0c","block_type":"box","text":"independent members of the board, and if voted on, only disinterested shareholders should vote.","page_number":206,"box":{"x":70,"y":748,"width":692,"height":12}},{"id":"a8fc8b43-79d1-4c6a-9eda-86ce2ffbddfa","block_type":"box","text":"CORPORATE REPORTING, RISK MANAGEMENT AND AUDIT","page_number":206,"box":{"x":274,"y":779,"width":430,"height":10}},{"id":"f0657d03-09d9-4ee9-a612-cbaa382e70dc","block_type":"box","text":"Investors depend on corporate repor ting, both regulatory and voluntary, to understand a company’s strategy, its","page_number":206,"box":{"x":102,"y":798,"width":796,"height":11}},{"id":"654ffc9c-27c5-4245-8c7c-6ae5d098ee1b","block_type":"box","text":"implementation and financial per formance, as well as to assess the quality of management and operations and","page_number":206,"box":{"x":70,"y":812,"width":795,"height":12}},{"id":"2ac546de-f649-43f8-a9e2-5053bf6b561c","block_type":"box","text":"potential for the company to create shareholder value over time. We consider it good practice for the board to","page_number":206,"box":{"x":70,"y":827,"width":779,"height":11}},{"id":"0c6f372e-c6ec-4697-992e-c1ca66d8953a","block_type":"box","text":"oversee corporate repor ting and the policies and procedures underpinning the internal audit function and external","page_number":206,"box":{"x":69,"y":842,"width":809,"height":11}},{"id":"751826ed-7ed9-4309-b3de-6d40b570cbc4","block_type":"box","text":"audit.","page_number":206,"box":{"x":69,"y":857,"width":38,"height":9}},{"id":"b1909953-5bcb-489b-8913-36b1cabd1fbe","block_type":"box","text":"A company’s financial repor ting should provide decision-useful information for investors, and other stakeholders,","page_number":206,"box":{"x":101,"y":875,"width":803,"height":12}},{"id":"5ba6660e-9bc1-4743-b970-ec920939738c","block_type":"box","text":"on its financial per formance and position. It should provide an accurate and balanced assessment of the risks and","page_number":206,"box":{"x":69,"y":890,"width":819,"height":11}},{"id":"d839aa83-50a3-40b3-9d39-793c0d401e8d","block_type":"box","text":"oppor tunities the company faces in realizing its long-term strategy. Accordingly, the assumptions made by","page_number":206,"box":{"x":69,"y":905,"width":752,"height":12}},{"id":"35f28da2-7124-46cd-b31d-78f26f010d5b","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":206,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"2f0374f6-fb6f-48d6-8090-bc79905cc167","block_type":"box","text":"Global Engagement and Voting Guidelines | 10","page_number":206,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"9ba10472-12a5-4823-9c6c-2560cffa95e0","block_type":"box","text":"NM1026U-6033063-206/246","page_number":206,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"d81964a0-821b-4453-978d-2a5bbe6e40c9","block_type":"box","text":"management and reviewed by the auditor in preparing the financial statements should be reasonable and justified.","page_number":207,"box":{"x":69,"y":45,"width":817,"height":11}},{"id":"abad59e4-9a64-4c20-b11b-a3d8ff397602","block_type":"box","text":"Financial statements should be prepared in accordance with globally developed repor ting standards and any","page_number":207,"box":{"x":70,"y":60,"width":771,"height":11}},{"id":"a5ad277c-8edb-42a4-899a-932793714029","block_type":"box","text":"divergence from generally accepted accounting principles should be explained in detail and justified. Accounting","page_number":207,"box":{"x":69,"y":74,"width":796,"height":12}},{"id":"b93de7d2-1957-4067-bc2b-d07c5522a5c7","block_type":"box","text":"restatements should be explained in detail and any remedial actions, and the implications of these, disclosed.","page_number":207,"box":{"x":69,"y":89,"width":788,"height":11}},{"id":"eab97d48-31c5-4959-88ab-2dfca5af46e1","block_type":"box","text":"In this context, audit committees play a vital role in a company’s financial repor ting system by providing","page_number":207,"box":{"x":102,"y":108,"width":739,"height":11}},{"id":"8c0926eb-d875-4173-89dd-1f9f62943792","block_type":"box","text":"independent oversight of the accounts, material financial and, where appropriate to the jurisdiction, non-financial","page_number":207,"box":{"x":70,"y":123,"width":801,"height":11}},{"id":"e99cb245-71a4-4e51-a01a-9b3a4cec6ded","block_type":"box","text":"information, internal control frameworks and Enterprise Risk Management systems. In our view, effective audit","page_number":207,"box":{"x":70,"y":138,"width":787,"height":11}},{"id":"c7e92940-7cdf-465d-bae6-366dd9dea190","block_type":"box","text":"committee oversight strengthens the quality and reliability of a company’s financial statements and provides an","page_number":207,"box":{"x":69,"y":152,"width":795,"height":12}},{"id":"af4be573-9ba2-47a2-b35e-11f280ec07fe","block_type":"box","text":"impor tant level of reassurance to shareholders. Audit committees should have a procedure in place for assessing the","page_number":207,"box":{"x":70,"y":167,"width":838,"height":12}},{"id":"89d95194-9d93-4cb6-a85a-c8b8e1494b8e","block_type":"box","text":"independence of the auditor and the quality of the external audit process annually.","page_number":207,"box":{"x":70,"y":182,"width":585,"height":11}},{"id":"0f69428a-5e99-4603-a50b-bc6ffd0acd54","block_type":"box","text":"Similarly, we encourage companies to disclose material sustainability-related factors that are integral to how a","page_number":207,"box":{"x":102,"y":201,"width":784,"height":11}},{"id":"743ae857-5352-47de-a0e0-12ef9dd64c7e","block_type":"box","text":"company manages risks or generates revenue. BAIS finds it helpful to our understanding when companies provide","page_number":207,"box":{"x":69,"y":216,"width":812,"height":11}},{"id":"a12c47cf-9cbd-44e3-948a-2c477f752cb3","block_type":"box","text":"robust, standardized disclosures on their material sustainability-related risks and oppor tunities. The International","page_number":207,"box":{"x":69,"y":231,"width":806,"height":11}},{"id":"993ff261-6008-40e3-8ea7-bfd21d85d1f8","block_type":"box","text":"Sustainability Standards Board (ISSB) is one entity working to meet these objectives through its repor ting standards,","page_number":207,"box":{"x":69,"y":246,"width":832,"height":11}},{"id":"b4a9404b-d114-42e1-840c-5c52354df65d","block_type":"box","text":"which may be helpful to companies in preparing such repor ts.","page_number":207,"box":{"x":68,"y":260,"width":440,"height":12}},{"id":"b2cc3a00-c60b-45e3-9f11-5833dee2b2a7","block_type":"box","text":"9","page_number":207,"box":{"x":509,"y":261,"width":5,"height":4}},{"id":"e27d230b-d22b-4aa2-aeea-6b95dbd1052d","block_type":"box","text":"However, we do not mandate any specific disclosure","page_number":207,"box":{"x":520,"y":260,"width":372,"height":11}},{"id":"3f711b7e-b49c-4618-884c-ca227ae4f098","block_type":"box","text":"framework, and note that companies in cer tain jurisdictions are subject to mandatory repor ting requirements under","page_number":207,"box":{"x":68,"y":275,"width":824,"height":11}},{"id":"f8ddfb83-f23d-49e8-973b-709bcc706038","block_type":"box","text":"standards specified by policy makers.","page_number":207,"box":{"x":69,"y":290,"width":267,"height":11}},{"id":"6f646096-d204-41f1-b26f-f5dd29c4ff03","block_type":"box","text":"10","page_number":207,"box":{"x":338,"y":290,"width":9,"height":5}},{"id":"7297e296-55bd-4a4f-8a90-3ed05f494016","block_type":"box","text":"Companies should establish robust risk management and internal control processes appropriate to the","page_number":207,"box":{"x":102,"y":309,"width":735,"height":11}},{"id":"5a07070a-efdc-4035-b782-9c73b55078af","block_type":"box","text":"company’s business, risk tolerance, and regulatory environment. A credible whistleblowing system for employees,","page_number":207,"box":{"x":69,"y":323,"width":810,"height":12}},{"id":"826d17d5-156d-4ae8-9209-192b82929984","block_type":"box","text":"and potentially other stakeholders, can be a useful mechanism for ensuring that senior management and the board","page_number":207,"box":{"x":69,"y":338,"width":822,"height":12}},{"id":"42ae55bc-6ebe-40f4-b2a5-4d6482767a16","block_type":"box","text":"are aware of potential misconduct or breaches in risk management and internal control processes.","page_number":207,"box":{"x":69,"y":353,"width":704,"height":12}},{"id":"81b88c17-ba4f-4993-963c-5c183592a173","block_type":"box","text":"A comprehensive audit conducted by an independent audit firm contributes to investor confidence in the quality","page_number":207,"box":{"x":101,"y":372,"width":794,"height":11}},{"id":"b6a3bbea-6da4-4a75-8765-5478734eb443","block_type":"box","text":"of corporate repor ting. It is helpful when the audit repor t gives some insight into the scope and focus of the audit, as","page_number":207,"box":{"x":69,"y":387,"width":836,"height":11}},{"id":"61c7df71-7bd5-4732-9779-9c54a1924c46","block_type":"box","text":"well as any critical audit matters identified and how these were resolved. A comprehensive and effective audit is time","page_number":207,"box":{"x":68,"y":402,"width":838,"height":11}},{"id":"c967a3ba-1c37-45cf-8b35-5bd3d57a7f14","block_type":"box","text":"and resource intensive, and the audit fee should be commensurate. Fees paid to the audit firm for non-audit","page_number":207,"box":{"x":69,"y":416,"width":773,"height":11}},{"id":"583f9fe6-23a9-4cd3-bbcc-201f13a5efb8","block_type":"box","text":"consulting should not exceed the audit fee to a degree that may prompt concerns about the independence of the","page_number":207,"box":{"x":69,"y":431,"width":804,"height":12}},{"id":"71363472-25a2-4ed7-a7c9-15fb0fd7a34a","block_type":"box","text":"audit. The audit committee should explain its position on auditor tenure and how it confirmed that the auditor","page_number":207,"box":{"x":69,"y":446,"width":780,"height":11}},{"id":"c7860fa4-8683-4fae-8775-1facbc216083","block_type":"box","text":"remained independent.","page_number":207,"box":{"x":69,"y":461,"width":163,"height":11}},{"id":"ddc1f1f4-bd5b-4458-b6dd-f7166d9dcd86","block_type":"box","text":"We may vote against the election of the responsible directors if corporate repor ting is insufficient or there are","page_number":207,"box":{"x":101,"y":480,"width":783,"height":11}},{"id":"39b5fe32-85eb-42a5-93b3-dff49f67a962","block_type":"box","text":"material misstatements in financial repor ts. In markets where relevant, we may vote against a proposal to approve","page_number":207,"box":{"x":69,"y":495,"width":819,"height":11}},{"id":"65424d25-382a-48aa-b938-48698740aa09","block_type":"box","text":"the financial statements or the discharge of the board when we are concerned about the quality of corporate","page_number":207,"box":{"x":68,"y":509,"width":774,"height":12}},{"id":"f961a826-8d72-4689-949c-65b768ea9f1e","block_type":"box","text":"repor ting or the audit. We may vote against proposals to appoint the auditor, ratify the audit repor t, or approve the","page_number":207,"box":{"x":69,"y":524,"width":816,"height":12}},{"id":"8ee99845-cf31-4446-8ca2-bbf708786773","block_type":"box","text":"audit fee if we are concerned about the auditor’s independence, the quality of the audit, or there are material","page_number":207,"box":{"x":69,"y":539,"width":779,"height":11}},{"id":"79a3a04c-a535-4d65-a4c4-25176e9dfb8f","block_type":"box","text":"misstatements in financial repor ts and the board has not established reasonable remediation plans.","page_number":207,"box":{"x":69,"y":554,"width":718,"height":11}},{"id":"d59b274f-85ec-479b-8d7d-90bed3ee5816","block_type":"box","text":"SHAREHOLDER RIGHTS AND PROTECTIONS","page_number":207,"box":{"x":329,"y":584,"width":319,"height":9}},{"id":"ea7424e2-ef79-43ff-b10b-7c1194839812","block_type":"box","text":"General shareholder meetings","page_number":207,"box":{"x":69,"y":607,"width":217,"height":11}},{"id":"932b68e2-9352-48f3-97e0-43799a568cc4","block_type":"box","text":"Companies normally have an annual general meeting of shareholders at which routine and non-routine items of","page_number":207,"box":{"x":102,"y":625,"width":792,"height":12}},{"id":"a098eec3-0bf6-4ad0-a8f8-7787844c5720","block_type":"box","text":"business are discussed and voted on by shareholders in attendance or submitting proxy votes. Companies should","page_number":207,"box":{"x":69,"y":640,"width":812,"height":11}},{"id":"13a868d7-f7fa-4851-8c41-c99f77f59f9c","block_type":"box","text":"disclose materials relevant to the shareholder meeting sufficiently in advance so that shareholders can take them","page_number":207,"box":{"x":69,"y":655,"width":813,"height":11}},{"id":"c863f256-9f78-4940-913a-b01387197876","block_type":"box","text":"into consideration in their voting decisions. Many companies offer shareholders the option of par ticipating in the","page_number":207,"box":{"x":70,"y":670,"width":801,"height":11}},{"id":"7b120f22-19e5-40ad-b4b3-dd1a3d0d9d6e","block_type":"box","text":"meeting vir tually which, whilst welcome, should not limit the rights of shareholders to par ticipate as they would during","page_number":207,"box":{"x":69,"y":685,"width":841,"height":11}},{"id":"8a680d23-617c-46c7-9394-77242fdd97a7","block_type":"box","text":"an in-person meeting.","page_number":207,"box":{"x":69,"y":700,"width":152,"height":11}},{"id":"fe2e636a-1776-4a44-8bac-99a6cc532d67","block_type":"box","text":"We may vote against directors when materials related to the business of the shareholder meeting are not","page_number":207,"box":{"x":101,"y":718,"width":752,"height":12}},{"id":"77c1f082-3df6-4ba9-9bef-30d6c157fb8c","block_type":"box","text":"provided in a timely manner or do not provide sufficient information for us to make an informed voting decision. We","page_number":207,"box":{"x":70,"y":733,"width":821,"height":11}},{"id":"b925a995-a2a1-47b3-ac53-1b62fcc753f2","block_type":"box","text":"may vote against directors if the format of the shareholder meeting does not accommodate reasonable shareholder","page_number":207,"box":{"x":69,"y":748,"width":825,"height":11}},{"id":"babb353f-58cb-42ce-a82a-9f30b7406202","block_type":"box","text":"par ticipation.","page_number":207,"box":{"x":70,"y":763,"width":91,"height":11}},{"id":"642aa404-d9f0-41e5-922a-1e6123743331","block_type":"box","text":"9","page_number":207,"box":{"x":69,"y":793,"width":4,"height":4}},{"id":"6a600773-f2ff-477d-97e7-88e2870354f8","block_type":"box","text":"The ISSB is an independent standard-setting body within the International Financial Repor ting Standards","page_number":207,"box":{"x":93,"y":792,"width":744,"height":11}},{"id":"14133f6b-695d-4756-8af6-008e6d3f7153","block_type":"box","text":"(IFRS) Foundation. Please refer to the IFRS website to learn more about the framework and standards S1","page_number":207,"box":{"x":94,"y":807,"width":748,"height":11}},{"id":"01cd1ddd-a54a-48bb-84fb-11e17842374f","block_type":"box","text":"“General Requirements for Disclosure of Sustainability-related Financial Information” and S2 “Climate-related","page_number":207,"box":{"x":94,"y":822,"width":778,"height":12}},{"id":"79e53781-8132-44ea-8780-033a702d02b7","block_type":"box","text":"Disclosures.”","page_number":207,"box":{"x":94,"y":838,"width":93,"height":8}},{"id":"afc59696-7628-432c-a814-720b79f635c0","block_type":"box","text":"10","page_number":207,"box":{"x":69,"y":856,"width":9,"height":4}},{"id":"56516580-d514-4cdb-bf5f-220ca1ed5f26","block_type":"box","text":"See, for examples, https://www.ifrs.org/news-and-events/news/2025/06/ifrs-foundation-publishes-jurisdictional- profiles\r\nissbstandards/ and https//financeeceropae/capitalmarketsnionandfinancialmarkets/compan","page_number":207,"box":{"x":93,"y":858,"width":810,"height":11}},{"id":"790b9e6b-1600-4ba7-8f15-83ef8f7126c3","block_type":"box","text":"See, for examples, https://www.ifrs.org/newsandevents/news/2025/06/ifrsfoundationpublishesjurisdictional\r\nprofiles-issb-standards/ and https://finance.ec.europa.eu/capital-markets-union-and-financial-markets/companyrepor ting\r\nandaditing/companrepor ting/corporatesstainabilitrepor tingen","page_number":207,"box":{"x":94,"y":866,"width":804,"height":12}},{"id":"005c1d70-ad2f-4dc7-a0e2-889e547f0db0","block_type":"box","text":"p/ p//p/p\r\nrepor ting-and-auditing/company-repor ting/corporate-sustainability-repor ting_en.","page_number":207,"box":{"x":94,"y":876,"width":564,"height":11}},{"id":"467e610f-28d8-49fb-94f2-9db5092d5da6","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":207,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"f15067a0-0c18-4bc6-a620-970176ec952a","block_type":"box","text":"Global Engagement and Voting Guidelines | 11","page_number":207,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"de915b1c-9a53-4aa3-b38d-a8cfed42b515","block_type":"box","text":"NM1026U-6033063-207/246","page_number":207,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"75a9f784-3089-4967-8676-3cf259222539","block_type":"box","text":"Bylaw amendments","page_number":208,"box":{"x":69,"y":45,"width":141,"height":11}},{"id":"b5fe5e9a-2dd7-4b97-8b6a-2180bae2054c","block_type":"box","text":"We review bylaw amendments proposed by management on a case-by-case basis and will generally suppor t","page_number":208,"box":{"x":101,"y":64,"width":766,"height":11}},{"id":"b5dbb8f9-4ec9-4891-97f1-b55eb3196c55","block_type":"box","text":"those that are aligned with the interests of minority shareholders. Any material changes to the bylaws should be","page_number":208,"box":{"x":68,"y":78,"width":800,"height":11}},{"id":"31a6bbbc-f0e9-450e-a3d6-225d972afe4a","block_type":"box","text":"explained in detail and put to a shareholder vote.","page_number":208,"box":{"x":69,"y":93,"width":349,"height":11}},{"id":"3f3ee7ad-b607-43f9-b04e-9fbfab4bb04b","block_type":"box","text":"We may vote against bylaw amendments that reduce shareholder rights and protections or introduce additional","page_number":208,"box":{"x":101,"y":112,"width":790,"height":11}},{"id":"638e21f0-5521-4008-b70d-f947811d2381","block_type":"box","text":"burdens. We may vote against directors if material changes are made to the bylaws without shareholder approval.","page_number":208,"box":{"x":69,"y":126,"width":810,"height":12}},{"id":"f1c8e365-ad32-4f56-953f-c5d126905cc5","block_type":"box","text":"If not provided for in the relevant corporate law, company bylaws should allow shareholders, individually or as a","page_number":208,"box":{"x":102,"y":145,"width":790,"height":11}},{"id":"3e4d0206-97d3-40cd-b01c-c36dc2b0ead2","block_type":"box","text":"group, with a meaningful shareholding, the right to call a special meeting of shareholders. The shareholding required","page_number":208,"box":{"x":68,"y":160,"width":831,"height":11}},{"id":"1f58eddd-9bd6-464d-a2e0-d2f2b8ce5fb6","block_type":"box","text":"to exercise this right should balance its utility with the cost to the company of holding special meetings.","page_number":208,"box":{"x":68,"y":175,"width":740,"height":11}},{"id":"cff93979-1195-4a0d-a5ff-1f1a2defe866","block_type":"box","text":"If not provided for in the relevant corporate law, company bylaws should allow shareholders, individually or as a","page_number":208,"box":{"x":102,"y":193,"width":790,"height":12}},{"id":"f28dcb6b-355d-4270-bcf8-d9444635464e","block_type":"box","text":"group, with a meaningful shareholding, the right to nominate directors to the company’s board. The threshold for this","page_number":208,"box":{"x":68,"y":208,"width":834,"height":12}},{"id":"07464524-99d2-4169-95e3-e19b5d351933","block_type":"box","text":"right should be set so that shareholders can exercise it without being unduly disruptive to the board’s own","page_number":208,"box":{"x":69,"y":223,"width":758,"height":12}},{"id":"6ca98f39-4188-41d5-ae64-eee900eb8a06","block_type":"box","text":"nomination process.","page_number":208,"box":{"x":69,"y":238,"width":143,"height":11}},{"id":"b39ec454-4825-4266-9b85-6abf7ed8ec1a","block_type":"box","text":"Whilst we would not use either of these rights ourselves, we see them as impor tant accountability mechanisms.","page_number":208,"box":{"x":101,"y":257,"width":799,"height":11}},{"id":"3bac76f7-d218-4496-9360-06050c92c13b","block_type":"box","text":"We may vote for a shareholder proposal seeking the addition of either of these provisions to a company’s bylaws.","page_number":208,"box":{"x":68,"y":272,"width":810,"height":11}},{"id":"8f07125d-e679-445c-a105-bfb0082dfc7b","block_type":"box","text":"Change of domicile","page_number":208,"box":{"x":69,"y":294,"width":139,"height":11}},{"id":"45f9fa26-0b96-4943-8c75-aa987542d4a7","block_type":"box","text":"We generally defer to management on proposals to change a company’s domicile as long as the rationale for","page_number":208,"box":{"x":101,"y":313,"width":778,"height":11}},{"id":"9e2f9ca5-d2be-4b62-970b-6f68b1412f90","block_type":"box","text":"doing so is consistent with the company’s long-term strategy and business model and the related costs are","page_number":208,"box":{"x":69,"y":328,"width":766,"height":11}},{"id":"07945950-0794-44d8-8eee-6f8b2b3ef0bc","block_type":"box","text":"immaterial.","page_number":208,"box":{"x":70,"y":343,"width":77,"height":8}},{"id":"c1b3c397-c0b2-48fb-b16a-935c20527835","block_type":"box","text":"We may vote against directors or a proposal to change a company’s domicile where it does not seem aligned","page_number":208,"box":{"x":101,"y":361,"width":777,"height":11}},{"id":"4965051d-52ea-4c46-9f14-62f1f1f245af","block_type":"box","text":"with our clients’ financial interests.","page_number":208,"box":{"x":68,"y":376,"width":249,"height":9}},{"id":"f4e83d4f-ef66-4b68-a5e3-3acabb4ab544","block_type":"box","text":"Changes to a company’s purpose or the nature of its business","page_number":208,"box":{"x":69,"y":398,"width":452,"height":11}},{"id":"dacfcdc5-4600-4dab-bea8-b7790effaa84","block_type":"box","text":"Plans to materially change the nature of a company’s business or its purpose should be disclosed and explained","page_number":208,"box":{"x":102,"y":417,"width":803,"height":11}},{"id":"2b5e3988-e644-44bc-b995-7f34a56d60d3","block_type":"box","text":"in the context of long-term strategy and business dynamics. Such changes may significantly alter an investor’s views","page_number":208,"box":{"x":70,"y":432,"width":829,"height":11}},{"id":"52efdc89-bb47-4a95-8eb0-d4337fed3014","block_type":"box","text":"on the suitability of a company for their investment strategy or por tfolio.","page_number":208,"box":{"x":69,"y":447,"width":511,"height":11}},{"id":"ff1b1f99-ae48-477a-98fd-01e46d92439c","block_type":"box","text":"Where relevant, we may vote against proposals to change a company’s purpose or the nature of its business if","page_number":208,"box":{"x":101,"y":465,"width":792,"height":12}},{"id":"a487e947-c9fd-4b08-8f5f-5d51c6fa77f4","block_type":"box","text":"the board has not provided a credible argument for change.","page_number":208,"box":{"x":68,"y":480,"width":424,"height":12}},{"id":"34703fa5-9517-4d35-adad-79c2fe486349","block_type":"box","text":"SHAREHOLDER PROPOSALS","page_number":208,"box":{"x":385,"y":510,"width":207,"height":9}},{"id":"1635c13f-a94c-4e5a-a6c7-399b80a5f896","block_type":"box","text":"Shareholders in many markets, who meet cer tain eligibility criteria, have the right to submit proposals to the","page_number":208,"box":{"x":102,"y":529,"width":772,"height":11}},{"id":"df74c56c-a5c0-442e-a25c-94b03ba0f9f8","block_type":"box","text":"general shareholder meeting asking a company to take a par ticular course of action subject to the proposal being","page_number":208,"box":{"x":68,"y":544,"width":811,"height":11}},{"id":"04b80153-4c60-4196-bf20-261591e44ee6","block_type":"box","text":"suppor ted by a majority of votes cast at the meeting. The topics raised can address a range of matters that may be","page_number":208,"box":{"x":69,"y":559,"width":824,"height":11}},{"id":"0bd8bdb3-bd41-4437-b433-6bd045cbf0a5","block_type":"box","text":"relevant to a company’s business.","page_number":208,"box":{"x":69,"y":574,"width":243,"height":11}},{"id":"05eb6692-c422-4128-b91f-0b5f7f5a567f","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":208,"box":{"x":101,"y":592,"width":730,"height":11}},{"id":"a0107143-3c31-4b1c-a03d-1ffd865f1ce7","block_type":"box","text":"company’s business and its current approach, whether the actions sought are consistent with shareholders’","page_number":208,"box":{"x":69,"y":607,"width":772,"height":11}},{"id":"2fff63a5-0e68-47fc-b85b-0f55deb0d157","block_type":"box","text":"interests, and what impact the proposal being acted upon might have on financial per formance.","page_number":208,"box":{"x":70,"y":622,"width":681,"height":11}},{"id":"cb9ed577-3f4b-4947-adc4-575e35f9efb2","block_type":"box","text":"Our general approach where we have concerns about a company’s governance, disclosures or per formance is to","page_number":208,"box":{"x":102,"y":641,"width":801,"height":11}},{"id":"8b2a0ed6-d0ac-4f0a-984f-2217b32cc5b2","block_type":"box","text":"engage to understand the apparent difference in perspective. If we are concerned a company is not acting in","page_number":208,"box":{"x":69,"y":656,"width":774,"height":11}},{"id":"10b8240f-789b-40aa-8e08-d3e2a5743b5b","block_type":"box","text":"shareholders’ financial interests, we may vote against the election of directors. We may suppor t a relevant","page_number":208,"box":{"x":69,"y":670,"width":761,"height":12}},{"id":"6cfdfc26-7378-4b36-b6c9-2bdd614951e6","block_type":"box","text":"shareholder proposal if doing so is aligned with our clients’ financial interests. We generally do not suppor t","page_number":208,"box":{"x":69,"y":685,"width":764,"height":12}},{"id":"52df79ff-8baf-4e8e-8e85-bcc81f762ffa","block_type":"box","text":"shareholder proposals that are legally binding on the company, seek to alter a company’s strategy or direct its","page_number":208,"box":{"x":69,"y":700,"width":785,"height":11}},{"id":"a3ab8dfb-848a-4963-ada5-321ab71bf710","block_type":"box","text":"operations, or are unrelated to how a company manages risk or generates financial returns.","page_number":208,"box":{"x":69,"y":715,"width":653,"height":11}},{"id":"ef3a2706-e1ac-4388-bad2-c07e643ac2c7","block_type":"box","text":"BlackRock is subject to rules, regulations, agency guidance and contractual agreements that place restrictions","page_number":208,"box":{"x":102,"y":734,"width":788,"height":11}},{"id":"2e72a670-b3bf-425f-b320-a2bfe72612d2","block_type":"box","text":"and limitations on how we can interact with the companies in which we invest on behalf of our clients, including our","page_number":208,"box":{"x":69,"y":748,"width":822,"height":12}},{"id":"4a245f68-0b99-4b39-bb4d-71532367b3b5","block_type":"box","text":"ability to submit shareholder proposals. We do not submit shareholder proposals but can vote, on behalf of clients","page_number":208,"box":{"x":69,"y":763,"width":817,"height":12}},{"id":"5c857f31-4e75-40ef-8557-d25105a41589","block_type":"box","text":"who authorize us to do so, on proposals put for th by others.","page_number":208,"box":{"x":68,"y":778,"width":428,"height":11}},{"id":"419e6bbd-45b1-4ae6-bb3e-90382c1dc6b1","block_type":"box","text":"CORPORATE POLITICAL ACTIVITIES","page_number":208,"box":{"x":359,"y":808,"width":260,"height":9}},{"id":"c4779b5d-7d93-4cac-85f7-96d304834152","block_type":"box","text":"A corporation’s ability to engage in the policy process is subject to rules and regulations set by the jurisdictions","page_number":208,"box":{"x":101,"y":827,"width":795,"height":11}},{"id":"43a42efa-b25d-416c-b60e-f9c0771e30f4","block_type":"box","text":"in which they engage. When a corporation repor ts material financial risk related to policy and or regulatory changes,","page_number":208,"box":{"x":70,"y":842,"width":824,"height":11}},{"id":"27bc8767-1cad-4119-8838-c951e51f1187","block_type":"box","text":"BAIS may seek to understand how it is addressing the material risk identified. We seek to understand how","page_number":208,"box":{"x":70,"y":857,"width":757,"height":11}},{"id":"88508c62-a821-4f4c-9c47-607c5b38a247","block_type":"box","text":"companies engage in corporate political activities and ensure that their par ticipation is consistent with their public","page_number":208,"box":{"x":69,"y":872,"width":814,"height":11}},{"id":"2de7c57d-e1c4-459d-88b7-30bb5bc775dd","block_type":"box","text":"statements on policy matters material to the company’s long-term strategy. The board should be aware of the","page_number":208,"box":{"x":69,"y":887,"width":780,"height":11}},{"id":"1465a274-bf34-44a7-8022-a44e6cf1ee7e","block_type":"box","text":"approach taken by management on corporate political activities as there can be reputational risks arising from","page_number":208,"box":{"x":69,"y":901,"width":786,"height":12}},{"id":"331a5dd6-3489-410d-8c82-b912f94fbfe6","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":208,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"012028ec-dc41-4c98-8aa1-4f9b678d6726","block_type":"box","text":"Global Engagement and Voting Guidelines | 12","page_number":208,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"0fb82263-356f-4e95-a958-38ee15703ce7","block_type":"box","text":"NM1026U-6033063-208/246","page_number":208,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"08ce7c93-a246-4250-b2b7-4609ee147542","block_type":"box","text":"inconsistencies between a company’s policy engagement and stated policy positions. Companies should, as a","page_number":209,"box":{"x":70,"y":45,"width":786,"height":11}},{"id":"c248e3a6-78f5-4751-8fb6-624898b610b8","block_type":"box","text":"minimum, meet all regulatory disclosure requirements on political activities. We may engage a company where we","page_number":209,"box":{"x":69,"y":60,"width":812,"height":11}},{"id":"8c5b69a8-c769-4591-84f2-a542d5814027","block_type":"box","text":"would like to better understand its approach to policy engagement, where relevant.","page_number":209,"box":{"x":68,"y":75,"width":590,"height":11}},{"id":"258b2331-79ce-4bae-8ea1-20b7aef9b486","block_type":"box","text":"To mitigate the risk of inconsistencies, companies may wish to assess the alignment between their policy","page_number":209,"box":{"x":101,"y":93,"width":753,"height":11}},{"id":"381a799e-7e60-427c-a0e1-b03a7811433f","block_type":"box","text":"priorities and the policy positions of the trade associations of which they are active members and any engagements","page_number":209,"box":{"x":70,"y":108,"width":823,"height":11}},{"id":"79d30830-557c-4b17-85fb-276a13b1057f","block_type":"box","text":"under taken by trade associations on behalf of members.","page_number":209,"box":{"x":69,"y":123,"width":404,"height":11}},{"id":"48dd4f6d-ae93-42a9-a645-2ae35dd86e59","block_type":"box","text":"We may suppor t a relevant shareholder proposal, or vote against directors, where a company’s disclosures are","page_number":209,"box":{"x":101,"y":142,"width":793,"height":11}},{"id":"e0f1abbd-1cea-4bed-9616-0da6444fa753","block_type":"box","text":"insufficient to address the material risk it has identified.","page_number":209,"box":{"x":70,"y":156,"width":400,"height":9}},{"id":"c335cbf0-1791-4499-b8fe-b6313d941ff0","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":209,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"a0a0a351-9937-403e-9e54-81af9cbafc06","block_type":"box","text":"Global Engagement and Voting Guidelines | 13","page_number":209,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"076e9fd0-0341-4ac3-89c6-330c21ec8209","block_type":"box","text":"NM1026U-6033063-209/246","page_number":209,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"1f919760-2406-44e7-9052-d3e42c3122f5","block_type":"box","text":"MATERIAL SUSTAINABILITY- RELATED RISKS AND OPPORTUNITIES","page_number":210,"box":{"x":245,"y":45,"width":489,"height":9}},{"id":"bbcc18c1-4446-439c-8b24-66b7c5a62159","block_type":"box","text":"We seek to understand how companies manage the material risks and oppor tunities inherent in their business","page_number":210,"box":{"x":101,"y":64,"width":790,"height":11}},{"id":"42c3c0b0-5a97-4ab6-a85c-9a73031de2c3","block_type":"box","text":"operations. In our experience, sustainability-related factors","page_number":210,"box":{"x":69,"y":78,"width":418,"height":12}},{"id":"2e44ec3d-a6dd-4f1e-88f9-0f23b4176c20","block_type":"box","text":"11","page_number":210,"box":{"x":488,"y":79,"width":9,"height":4}},{"id":"6e06097e-bd1d-40f3-9b75-c9e5e0220aab","block_type":"box","text":"that are relevant to a company’s business or material to","page_number":210,"box":{"x":502,"y":79,"width":402,"height":11}},{"id":"83e47aee-0937-4c32-ac97-1186ce58831d","block_type":"box","text":"its financial per formance, are generally operational considerations embedded into day-to-day management systems.","page_number":210,"box":{"x":70,"y":93,"width":824,"height":12}},{"id":"22da883d-ef72-4fff-8a35-4ca8287ec57e","block_type":"box","text":"Cer tain sustainability issues may also inform long-term strategic planning, for example, investing in product","page_number":210,"box":{"x":69,"y":108,"width":766,"height":11}},{"id":"ff09b986-1d63-4e13-9b30-e64465eff787","block_type":"box","text":"innovation in anticipation of changing consumer demand or adapting supply chains in response to changing","page_number":210,"box":{"x":70,"y":123,"width":764,"height":11}},{"id":"aad82a29-555e-45a7-bb31-e3efad0ec163","block_type":"box","text":"regulatory requirements.","page_number":210,"box":{"x":69,"y":138,"width":174,"height":11}},{"id":"98e6b355-0c3f-4e39-a8ec-65aed37854cb","block_type":"box","text":"We recognize that the specific sustainability-related factors that may be financially material or business relevant","page_number":210,"box":{"x":101,"y":156,"width":798,"height":12}},{"id":"cc353275-1510-436f-a857-b490a421a090","block_type":"box","text":"will vary by company business model, sector, key markets, and time horizon, amongst other considerations. From","page_number":210,"box":{"x":68,"y":172,"width":809,"height":11}},{"id":"b68187ac-4086-4980-8bfd-846b9ddbfd59","block_type":"box","text":"company disclosures and our engagement, we aim to understand how management is identifying, assessing and","page_number":210,"box":{"x":69,"y":186,"width":803,"height":12}},{"id":"cd1088cb-c87d-40ca-9533-add1beb61996","block_type":"box","text":"integrating material sustainability-related risks and oppor tunities into their business decision-making and practices.","page_number":210,"box":{"x":70,"y":201,"width":820,"height":11}},{"id":"d0444201-021e-4096-9d42-ee24193c68ad","block_type":"box","text":"Doing so helps us under take a more holistic assessment of a company’s potential financial per formance and the","page_number":210,"box":{"x":70,"y":216,"width":808,"height":11}},{"id":"9ea4d075-4a9e-46c5-9f45-0b2bf9ed94eb","block_type":"box","text":"likely risk-adjusted returns of an investment.","page_number":210,"box":{"x":70,"y":231,"width":313,"height":11}},{"id":"f84a99a3-d16d-4ab6-a62a-4d4deaea4f7e","block_type":"box","text":"We may vote against directors or suppor t a relevant shareholder proposal if we have concerns about how a","page_number":210,"box":{"x":101,"y":249,"width":764,"height":12}},{"id":"b8ec34b8-55e1-4210-a368-5cef668e9dcc","block_type":"box","text":"company is managing or disclosing its approach to material sustainability-related risks that may impact financial","page_number":210,"box":{"x":69,"y":264,"width":798,"height":12}},{"id":"a9b3eb91-1e19-43a1-a75e-cd264219d54e","block_type":"box","text":"returns.","page_number":210,"box":{"x":69,"y":280,"width":54,"height":8}},{"id":"a4b6f481-8a75-43a3-af83-00a40edec6ac","block_type":"box","text":"KEY STAKEHOLDERS","page_number":210,"box":{"x":414,"y":309,"width":151,"height":9}},{"id":"723c1511-4c3c-4c23-983b-7caa4ba276a0","block_type":"box","text":"In our view, companies should understand and take into consideration the interests of the various par ties on","page_number":210,"box":{"x":102,"y":328,"width":774,"height":11}},{"id":"be0c05ab-2f0f-4967-ade2-8830d43c65a4","block_type":"box","text":"whom they depend for their success over time. It is for each company to determine their key stakeholders based on","page_number":210,"box":{"x":68,"y":343,"width":826,"height":11}},{"id":"f289aefc-9694-4e93-bd49-92fc44a7b244","block_type":"box","text":"what is material to their business and long-term financial per formance. For many companies, key stakeholders","page_number":210,"box":{"x":68,"y":358,"width":790,"height":11}},{"id":"a6d56d55-1065-4fac-ad56-576c7343f5ee","block_type":"box","text":"include employees, business par tners (such as suppliers and distributors), clients and consumers, regulators, and","page_number":210,"box":{"x":70,"y":373,"width":817,"height":11}},{"id":"cff26657-0f28-436c-9810-3d521d9a45e4","block_type":"box","text":"the communities in which they operate. Companies that appropriately balance the interests of investors and other","page_number":210,"box":{"x":68,"y":387,"width":813,"height":12}},{"id":"a6425c96-07a4-4cc9-b4c3-10cc648beef6","block_type":"box","text":"stakeholders are, in our experience, more likely to be financially resilient over time.","page_number":210,"box":{"x":69,"y":402,"width":592,"height":12}},{"id":"f3de5734-3437-46d3-831e-0cd9460533c1","block_type":"box","text":"CLIMATE AND DECARBONIZATION INVESTMENT OBJECTIVES","page_number":210,"box":{"x":265,"y":432,"width":448,"height":9}},{"id":"30c33735-dc3f-4bf3-9001-80f1b2d0eb5c","block_type":"box","text":"Cer tain active BlackRock funds have climate and decarbonization objectives in addition to financial objectives.","page_number":210,"box":{"x":102,"y":451,"width":784,"height":11}},{"id":"59636047-72d7-4548-b995-3d0f91ed1c8f","block_type":"box","text":"Consistent with the objectives of those investment strategies, our stewardship activity in relation to the holdings in","page_number":210,"box":{"x":69,"y":466,"width":818,"height":11}},{"id":"a7fb74c6-73ee-4b97-ae57-96b3c1246815","block_type":"box","text":"those funds differs in some respects from BAIS’ benchmark guidelines, which are described above. Specifically, for","page_number":210,"box":{"x":68,"y":481,"width":823,"height":11}},{"id":"3fd46f67-dc49-493a-85ef-d0a1ee0c26e7","block_type":"box","text":"those funds’ holdings, we look to investee companies to demonstrate that they are aligned with a decarbonization","page_number":210,"box":{"x":68,"y":496,"width":814,"height":11}},{"id":"c2979ccb-95b7-4d1d-ad8d-73114a96d3fa","block_type":"box","text":"pathway that means their business model would be viable in a low-carbon economy,","page_number":210,"box":{"x":70,"y":511,"width":594,"height":11}},{"id":"cd526ade-635c-469d-a291-f826eee22178","block_type":"box","text":"i.e.","page_number":210,"box":{"x":672,"y":511,"width":20,"height":9}},{"id":"82e7190b-3cac-43db-ab63-8f13d8e183b1","block_type":"box","text":", one in which global","page_number":210,"box":{"x":694,"y":511,"width":144,"height":11}},{"id":"bacbc0c0-a263-49c2-a42e-6e98d1a7914e","block_type":"box","text":"temperature rise is limited to 1.5°C above pre-industrial levels. In addition, clients in separately managed accounts","page_number":210,"box":{"x":68,"y":526,"width":821,"height":11}},{"id":"2cef8028-3049-43c9-af73-355670c81165","block_type":"box","text":"may instruct BlackRock to apply these guidelines to their holdings. Both in the case of funds and separately managed","page_number":210,"box":{"x":69,"y":540,"width":839,"height":12}},{"id":"642ccf19-7ca6-4dc0-9827-9a6f3214b7fb","block_type":"box","text":"accounts, these guidelines are only implemented upon explicit selection and approval by the applicable fund board or","page_number":210,"box":{"x":69,"y":555,"width":837,"height":12}},{"id":"fbe69157-9e8a-47b0-9a1f-20cd6bccbc9b","block_type":"box","text":"client.","page_number":210,"box":{"x":69,"y":570,"width":41,"height":9}},{"id":"a9bf70e3-b164-43f0-9a0f-8321dbb4eebf","block_type":"box","text":"These decarbonization stewardship guidelines focus on companies which produce goods and services that","page_number":210,"box":{"x":101,"y":589,"width":761,"height":11}},{"id":"74f9fe47-3e31-4938-a325-282c2c656483","block_type":"box","text":"contribute to real world decarbonization or have a carbon intensive business model and face outsized impacts from","page_number":210,"box":{"x":69,"y":604,"width":821,"height":11}},{"id":"78d66a55-16fb-4e96-8ff2-2e1d72731c26","block_type":"box","text":"the low carbon transition, based on repor ted and estimated scopes 1, 2, and 3 greenhouse gas emissions. These","page_number":210,"box":{"x":68,"y":619,"width":817,"height":11}},{"id":"abe51af3-8c9b-4967-99ad-c1e24813bea9","block_type":"box","text":"companies should provide disclosures that set out their governance, strategy, risk management processes and","page_number":210,"box":{"x":69,"y":634,"width":792,"height":11}},{"id":"3133b8a1-e7a7-4b29-939b-82c4e37d3854","block_type":"box","text":"metrics and targets relevant to decarbonization. It is helpful to investors’ understanding when these disclosures","page_number":210,"box":{"x":69,"y":648,"width":799,"height":12}},{"id":"06e76ec6-24a7-4b20-9f54-ea26ea22141e","block_type":"box","text":"include an explanation of the decarbonization scenarios a company is using in its near- and long-term planning, as","page_number":210,"box":{"x":70,"y":663,"width":812,"height":11}},{"id":"88eadd0e-b264-4f0a-a0d6-a9e413db37c5","block_type":"box","text":"well as its scope 1, scope 2 and material scope 3 greenhouse gas (GHG) emissions and reduction targets for scope","page_number":210,"box":{"x":68,"y":678,"width":831,"height":11}},{"id":"b10d129f-1b0a-41e0-8f70-67e59bbf5a3a","block_type":"box","text":"1 and 2 emissions.","page_number":210,"box":{"x":70,"y":693,"width":135,"height":9}},{"id":"c121953a-ae3c-49b8-b0cd-b876b904c3a1","block_type":"box","text":"Under these climate- and decarbonization-specific guidelines, BAIS may recommend a vote against directors or","page_number":210,"box":{"x":102,"y":711,"width":788,"height":12}},{"id":"9ffae378-b6f0-4641-b036-23fd09683d4c","block_type":"box","text":"suppor t for a relevant shareholder proposal if a company does not appear to be adequately acting to address or","page_number":210,"box":{"x":69,"y":726,"width":800,"height":12}},{"id":"82799414-ab51-4315-ba7d-0071220c81d0","block_type":"box","text":"disclosing material climate-related risks, consistent with the parameters set out in these climate-and decarbonization","page_number":210,"box":{"x":69,"y":741,"width":839,"height":12}},{"id":"99895094-dc94-4e71-a565-5b0e37224290","block_type":"box","text":"specific guidelines. We may recommend suppor ting shareholder proposals seeking information relevant to a","page_number":210,"box":{"x":69,"y":756,"width":771,"height":11}},{"id":"bb40a8d1-73b6-4783-84ef-fd7e4fefdea7","block_type":"box","text":"11","page_number":210,"box":{"x":69,"y":786,"width":9,"height":4}},{"id":"c3a84aef-c381-4a79-b1f5-4719c3849d71","block_type":"box","text":"By material sustainability-related risks and oppor tunities, we mean the drivers of risk and financial value creation in","page_number":210,"box":{"x":84,"y":785,"width":822,"height":11}},{"id":"952c942c-4649-4628-88a7-8370ab3dfc4a","block_type":"box","text":"a company’s business model that have an environmental or social dependency or impact. Examples of environmental","page_number":210,"box":{"x":69,"y":800,"width":835,"height":12}},{"id":"7b78d548-eebb-43d4-91a0-fcf114a1f8ac","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":210,"box":{"x":70,"y":816,"width":827,"height":11}},{"id":"c10e8bba-6141-4e2a-bd3d-000772994ccf","block_type":"box","text":"issues include, but are not limited to, human capital management, impacts on the communities in which a company","page_number":210,"box":{"x":70,"y":831,"width":826,"height":11}},{"id":"2a67e55d-e4d9-4072-b534-b3030b2c2b55","block_type":"box","text":"operates, customer loyalty, and relationships with regulators. It is our view that well-managed companies will","page_number":210,"box":{"x":69,"y":846,"width":773,"height":11}},{"id":"f7d9b13b-cb95-4f1b-8a97-e424af3e5280","block_type":"box","text":"effectively evaluate and manage material sustainability-related risks and oppor tunities relevant to their businesses.","page_number":210,"box":{"x":69,"y":861,"width":823,"height":11}},{"id":"29d3765f-09cb-4ffe-a56a-50949f1e3361","block_type":"box","text":"Governance is the core means by which boards can oversee the creation of durable financial value over time.","page_number":210,"box":{"x":69,"y":876,"width":777,"height":11}},{"id":"b15abafe-79cd-4753-a1d8-2a10d7639cbc","block_type":"box","text":"Appropriate risk oversight of business-relevant and material sustainability-related considerations is a component of a","page_number":210,"box":{"x":68,"y":891,"width":833,"height":11}},{"id":"96d40d95-7e72-4b1b-aae2-d9f3d80c9225","block_type":"box","text":"sound governance framework.","page_number":210,"box":{"x":69,"y":906,"width":212,"height":12}},{"id":"a68facb4-7859-49bc-9b74-7d707cb49cc4","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":210,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"afb8fb6b-6735-4b12-b4a7-d4632d116e44","block_type":"box","text":"Global Engagement and Voting Guidelines | 14","page_number":210,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"bc552c95-3bea-4733-b41c-b7728ec8d896","block_type":"box","text":"NM1026U-6033063-210/246","page_number":210,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"a5437422-ee5d-4924-a833-1f80ff17238e","block_type":"box","text":"company’s stated low-carbon transition strategy or targets that the company does not currently provide and that","page_number":211,"box":{"x":69,"y":45,"width":798,"height":11}},{"id":"34f3567d-56fa-4f5f-ad23-60e81c59fba9","block_type":"box","text":"would be helpful to investment decision-making. We would not recommend suppor t for shareholder proposals that","page_number":211,"box":{"x":68,"y":59,"width":814,"height":12}},{"id":"a6fb21c3-2932-46b1-b659-0ea0c4c90021","block_type":"box","text":"seek to constrain board or management decision-making or direct specific business or strategic decisions. As under","page_number":211,"box":{"x":69,"y":74,"width":828,"height":12}},{"id":"e9570faa-d1bb-4828-9752-65420001f6f5","block_type":"box","text":"the BAIS benchmark approach, the active por tfolio managers are ultimately responsible for voting consistent with","page_number":211,"box":{"x":68,"y":89,"width":807,"height":12}},{"id":"64d02771-c929-4ef7-802a-6781592bf012","block_type":"box","text":"their investment mandate and fund objectives. For the funds and accounts in scope, voting on matters not related to","page_number":211,"box":{"x":68,"y":104,"width":832,"height":11}},{"id":"351fa740-b1d6-443a-b768-d2cbc3b71772","block_type":"box","text":"climate risk and the energy transition is under taken in line with BAIS’ benchmark guidelines.","page_number":211,"box":{"x":69,"y":119,"width":658,"height":11}},{"id":"9f221fff-137b-49dc-bdec-6fcb0799ae0a","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":211,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"b03edcc6-3bd3-48e2-90ab-cc4a845130e1","block_type":"box","text":"Global Engagement and Voting Guidelines | 15","page_number":211,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"f5466bf1-4b44-40a4-a482-7301f338faec","block_type":"box","text":"NM1026U-6033063-211/246","page_number":211,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"c34052a2-43fa-4e8c-8d76-39e438a87d42","block_type":"box","text":"APPENDIX 1: HOW WE FULFILL AND OVERSEE OUR INVESTMENT STEWARDSHIP RESPONSIBILITIES FOR NON","page_number":212,"box":{"x":83,"y":45,"width":812,"height":9}},{"id":"a45ba172-0436-4430-9722-82a62cd05649","block_type":"box","text":"INDEX EQUITY INVESTMENT STRATEGIES","page_number":212,"box":{"x":338,"y":60,"width":302,"height":10}},{"id":"36255703-1dd7-4d41-ac24-b998c0ee8b3b","block_type":"box","text":"Oversight","page_number":212,"box":{"x":69,"y":83,"width":68,"height":11}},{"id":"b9fd7e03-b050-4f9a-98ab-020ca65524e7","block_type":"box","text":"The Global Head of BAIS has primary oversight of and responsibility for the team’s activities, including voting in","page_number":212,"box":{"x":101,"y":101,"width":793,"height":11}},{"id":"21f91478-2035-4b01-a0d5-82a66f518a3e","block_type":"box","text":"accordance with the BlackRock Active Investment Stewardship Global Engagement and Voting Guidelines (the","page_number":212,"box":{"x":69,"y":116,"width":778,"height":11}},{"id":"b89043a2-9677-46a7-a951-ce443a6d27dd","block_type":"box","text":"“Guidelines”), which require the application of professional judgment and consideration of each company’s unique","page_number":212,"box":{"x":70,"y":131,"width":814,"height":11}},{"id":"5684d614-92c9-417a-ac7d-bb71818b9183","block_type":"box","text":"circumstances, as well as input from active investors. BAIS is independent from BlackRock Investment Stewardship","page_number":212,"box":{"x":69,"y":146,"width":825,"height":11}},{"id":"9b06555c-e640-451e-9ea0-cb52643a1cd6","block_type":"box","text":"in our engagement and voting activities, repor ting lines, and oversight.","page_number":212,"box":{"x":70,"y":161,"width":500,"height":11}},{"id":"ff638f45-691a-4f0b-a201-16aab242838e","block_type":"box","text":"The Stewardship Leaders Group, comprised of senior active investors and other relevant stakeholders in","page_number":212,"box":{"x":101,"y":179,"width":744,"height":11}},{"id":"bd49517a-3007-440a-9969-6623a207be4d","block_type":"box","text":"BlackRock’s legal, public policy, sustainability and communications teams, helps shape the firm’s approach to","page_number":212,"box":{"x":70,"y":194,"width":786,"height":11}},{"id":"aa974171-715f-4bf3-bfa0-d68a2a76014a","block_type":"box","text":"investment stewardship on non-index equity investment strategies. The Group may advise on and review amendments","page_number":212,"box":{"x":70,"y":209,"width":839,"height":11}},{"id":"6c3a7bd0-1e27-4a5c-90a8-ec90f8ebb8fa","block_type":"box","text":"to BAIS’ policies and practices. It does not determine voting decisions, which are the responsibility of BAIS and the","page_number":212,"box":{"x":68,"y":224,"width":822,"height":11}},{"id":"4cc97e6a-1403-435b-a503-cb8b1cd1cbf7","block_type":"box","text":"relevant active equity investors.","page_number":212,"box":{"x":69,"y":239,"width":223,"height":11}},{"id":"f3a425bc-6052-448d-8a4f-22a0ec9d9cfc","block_type":"box","text":"BAIS carries out engagement with companies in collaboration with active investment colleagues, executes proxy","page_number":212,"box":{"x":102,"y":257,"width":797,"height":12}},{"id":"c6d4cbd1-c766-4dba-aa1c-70c85af9710f","block_type":"box","text":"votes, and conducts vote operations (including maintaining records of votes cast) in a manner consistent with the","page_number":212,"box":{"x":68,"y":272,"width":810,"height":11}},{"id":"4b98af78-94c9-4fb1-bc76-2e19bfeea4ef","block_type":"box","text":"Guidelines. BAIS also conducts research on corporate governance issues and par ticipates in industry discussions to","page_number":212,"box":{"x":69,"y":287,"width":832,"height":11}},{"id":"46288267-713c-4758-8733-bd6f518a477f","block_type":"box","text":"contribute to and keep abreast of impor tant developments in the corporate governance field. BAIS may use third","page_number":212,"box":{"x":69,"y":302,"width":801,"height":11}},{"id":"6c415e54-f986-4079-b670-d1d90ffc48a4","block_type":"box","text":"par ties for cer tain of the foregoing activities and per forms oversight of those third par ties (see “Use and oversight of","page_number":212,"box":{"x":70,"y":317,"width":836,"height":11}},{"id":"452152c8-ccab-4813-bfe3-2e205009dd57","block_type":"box","text":"third-par ty vote services providers” below).","page_number":212,"box":{"x":68,"y":332,"width":305,"height":11}},{"id":"b0a00b11-eee1-44ad-b740-77920584d05a","block_type":"box","text":"Voting guidelines and vote execution","page_number":212,"box":{"x":68,"y":354,"width":269,"height":11}},{"id":"cfac5e52-09d3-445e-95ee-cd7d94641485","block_type":"box","text":"BlackRock votes on proxy issues when our clients authorize us to do so. We carefully consider the voting items","page_number":212,"box":{"x":102,"y":373,"width":790,"height":11}},{"id":"0ed9f7de-e49a-4165-951d-8695985df588","block_type":"box","text":"submitted to funds and other fiduciary account(s) (Fund or Funds) for which we have voting authority. BlackRock votes","page_number":212,"box":{"x":69,"y":387,"width":838,"height":12}},{"id":"b7515d80-65b1-4a33-a463-cc2c8c0cf370","block_type":"box","text":"(or refrains from voting) for each Fund for which we have voting authority based on our evaluation of the alignment of","page_number":212,"box":{"x":69,"y":402,"width":831,"height":12}},{"id":"bc4e6f7c-b410-4d39-97f9-c70c786c1c2c","block_type":"box","text":"the voting items with the long-term economic interests of our clients, in the exercise of our independent business","page_number":212,"box":{"x":68,"y":417,"width":809,"height":12}},{"id":"64491f46-2530-43de-a972-be746585c758","block_type":"box","text":"judgment, and without regard to the relationship of the issuer (or any shareholder proponent or dissident","page_number":212,"box":{"x":67,"y":432,"width":749,"height":11}},{"id":"493b7200-a516-45f1-aabe-1187121043ef","block_type":"box","text":"shareholder) to the Fund, the Fund’s affiliates (if any), BlackRock or BlackRock’s affiliates, or BlackRock employees","page_number":212,"box":{"x":69,"y":447,"width":825,"height":11}},{"id":"e39f2c5b-6d9e-4480-b0f3-fcc3470d3bf0","block_type":"box","text":"(see “Conflicts management policies and procedures,” below).","page_number":212,"box":{"x":69,"y":462,"width":445,"height":11}},{"id":"548d8720-f657-4230-a181-1bd1ffdab345","block_type":"box","text":"When exercising voting rights, BAIS will normally vote on specific proxy issues in accordance with the Guidelines,","page_number":212,"box":{"x":101,"y":480,"width":803,"height":12}},{"id":"72d40257-ce12-410d-9d65-0a4d8d3b54dd","block_type":"box","text":"although por tfolio managers have the right to vote differently on their holdings if they determine doing so is more","page_number":212,"box":{"x":69,"y":495,"width":806,"height":12}},{"id":"b5d8d5fa-699a-4c80-90d5-d3e33d28f46d","block_type":"box","text":"aligned with the investment objective and financial interests of clients invested in the funds they manage.","page_number":212,"box":{"x":69,"y":510,"width":752,"height":11}},{"id":"45aaba76-dded-4f32-8461-98130f4c7945","block_type":"box","text":"The Guidelines are not intended to be exhaustive. 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The","page_number":212,"box":{"x":68,"y":574,"width":838,"height":11}},{"id":"115f5438-6f60-4f1c-8be7-c06fa86121c3","block_type":"box","text":"Guidelines are reviewed annually and updated as necessary to reflect changes in market practices, developments in","page_number":212,"box":{"x":69,"y":588,"width":829,"height":12}},{"id":"9d1fd757-4994-4a7a-885d-731643e3838d","block_type":"box","text":"corporate governance and feedback from companies and clients. In this way, BAIS aims to maintain policies that","page_number":212,"box":{"x":69,"y":603,"width":802,"height":11}},{"id":"7dae81ed-4229-48a8-93ec-883b3d2d78ec","block_type":"box","text":"explain our approach to governance practices most aligned with clients’ long-term financial interests.","page_number":212,"box":{"x":69,"y":618,"width":718,"height":11}},{"id":"3fb7db08-4f0b-468b-a091-3af37eb95c86","block_type":"box","text":"In cer tain markets, proxy voting involves logistical issues which can affect BAIS’ ability to vote such proxies, as","page_number":212,"box":{"x":102,"y":637,"width":792,"height":11}},{"id":"4ac7e101-dab5-4af1-938d-c255e8002d8d","block_type":"box","text":"well as the desirability of voting such proxies. 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We are not suppor tive of impediments to the","page_number":212,"box":{"x":70,"y":726,"width":806,"height":11}},{"id":"433b68cd-e133-4f6b-92e0-519ca0a8927a","block_type":"box","text":"exercise of voting rights such as share-blocking or overly burdensome administrative requirements.","page_number":212,"box":{"x":69,"y":741,"width":704,"height":11}},{"id":"a7f68013-ac61-42cf-b3e0-303fdfbc3eea","block_type":"box","text":"BlackRock votes proxies in these situations on a “best-effor ts” basis. 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In addition, institutional clients in","page_number":213,"box":{"x":70,"y":60,"width":834,"height":11}},{"id":"9e665f80-d56b-4e69-874f-88851e8f0c4a","block_type":"box","text":"separately managed accounts (SMAs) are eligible for BlackRock Voting Choice regardless of their investment","page_number":213,"box":{"x":69,"y":74,"width":774,"height":12}},{"id":"07f464e0-a841-4ed9-8146-774034d8c1bb","block_type":"box","text":"strategies.","page_number":213,"box":{"x":69,"y":89,"width":74,"height":12}},{"id":"e6b42bc2-63fb-4ff9-a7b9-168431e3bdc8","block_type":"box","text":"12","page_number":213,"box":{"x":145,"y":90,"width":9,"height":4}},{"id":"dc0fe6df-54ba-42eb-a512-2a58d1b6dca4","block_type":"box","text":"As a result, the shares attributed to BlackRock in company share registers may be voted differently depending","page_number":213,"box":{"x":101,"y":108,"width":788,"height":11}},{"id":"968ca9cf-d809-4ac5-8248-1e4ce8531a19","block_type":"box","text":"on whether our clients have authorized BAIS to vote on their behalf, have authorized BlackRock to vote in accordance","page_number":213,"box":{"x":69,"y":123,"width":834,"height":10}},{"id":"cdf72355-ab2c-45b6-9b00-2069a27f8225","block_type":"box","text":"with a third-par ty policy, or have elected to vote shares in accordance with their own policy. 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BlackRock contracts primarily with the vote services provider ISS and","page_number":213,"box":{"x":68,"y":208,"width":770,"height":12}},{"id":"e8ca5721-e5c3-481a-b6db-31938602de21","block_type":"box","text":"leverages its online platform to supply research and suppor t voting, record keeping, and repor ting processes. We","page_number":213,"box":{"x":70,"y":223,"width":807,"height":12}},{"id":"260bec54-05e0-47c3-b5b5-1fa8b843683f","block_type":"box","text":"also use Glass Lewis’ research and analysis as an input into our voting process. It is impor tant to note that, although","page_number":213,"box":{"x":69,"y":238,"width":839,"height":11}},{"id":"32e9ad29-b376-4b66-b44f-d1ea80b9dcda","block_type":"box","text":"proxy research firms provide impor tant data and analysis, BAIS does not rely solely on their information or follow their","page_number":213,"box":{"x":70,"y":253,"width":839,"height":11}},{"id":"d0f9b3e4-573d-4e68-8dd4-48b4c91f1b22","block_type":"box","text":"voting recommendations. A company’s disclosures, our engagements and voting, investment colleagues’ insights and","page_number":213,"box":{"x":68,"y":268,"width":840,"height":11}},{"id":"3090af9f-5d05-411e-8712-d353c0e94e54","block_type":"box","text":"our Guidelines are impor tant inputs into our voting decisions on behalf of clients.","page_number":213,"box":{"x":69,"y":283,"width":578,"height":11}},{"id":"eeee8d59-d47c-4630-85b9-6de32d84427c","block_type":"box","text":"Given the large universe of actively held companies, BAIS employs the proxy services provider to streamline the","page_number":213,"box":{"x":102,"y":301,"width":795,"height":12}},{"id":"fae25043-2f0b-4bd6-a2cb-c1b2b4c581cc","block_type":"box","text":"voting process by making voting recommendations based on BAIS’ Guidelines when the items on a shareholder","page_number":213,"box":{"x":68,"y":316,"width":795,"height":12}},{"id":"5f4d0da9-a3c0-41aa-aa90-a0a5178326a0","block_type":"box","text":"meeting agenda are routine. Agenda items that are not routine are referred back to BAIS to assess, escalate as","page_number":213,"box":{"x":69,"y":331,"width":799,"height":11}},{"id":"fb522075-8131-4edb-9657-b1a5c6cbc752","block_type":"box","text":"necessary to the relevant por tfolio managers and vote. BAIS reviews and can override the recommendations of the","page_number":213,"box":{"x":69,"y":346,"width":819,"height":11}},{"id":"9490dae1-310c-4d14-bb46-2b4ca0646b09","block_type":"box","text":"vote services provider at any time prior to the vote deadline. Both BAIS and the vote services provider actively","page_number":213,"box":{"x":68,"y":361,"width":785,"height":11}},{"id":"031c5976-fbc2-4c9c-8594-177cd87bd495","block_type":"box","text":"monitor securities filings, research repor ts, company announcements, and direct communications from companies to","page_number":213,"box":{"x":69,"y":376,"width":837,"height":11}},{"id":"0ca78085-a88e-453a-8e16-2fe8ffffbfb9","block_type":"box","text":"ensure awareness of supplemental disclosures and proxy materials that may require a modification of votes.","page_number":213,"box":{"x":69,"y":390,"width":775,"height":12}},{"id":"2db80a96-cf21-4134-aba9-7fd46b1f7c97","block_type":"box","text":"BAIS closely monitors the third-par ty vote services providers we contract with to ensure that they are meeting our","page_number":213,"box":{"x":102,"y":409,"width":807,"height":11}},{"id":"85568b2e-ae8a-4ccc-a563-f699b6176229","block_type":"box","text":"service level expectations and have effective policies and procedures in place to manage potential conflicts of","page_number":213,"box":{"x":69,"y":424,"width":788,"height":11}},{"id":"a162346c-c358-4751-a390-b40ee9761100","block_type":"box","text":"interest. 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In addition, BlackRock has adopted guidelines and procedures (as from time to","page_number":216,"box":{"x":101,"y":439,"width":793,"height":11}},{"id":"f9e604f7-088e-4598-994d-95d0eb2d8241","block_type":"box","text":"time amended, the “BlackRock Climate and Decarbonization Stewardship Guidelines”) governing proxy voting for","page_number":216,"box":{"x":101,"y":454,"width":801,"height":11}},{"id":"44046384-74fd-4628-bbe4-4cb48f2fa585","block_type":"box","text":"matters covered in the BlackRock Climate and Decarbonization Stewardship Guidelines by the Funds listed in","page_number":216,"box":{"x":102,"y":469,"width":777,"height":11}},{"id":"94cd87e0-82db-4c8a-8e90-d79f59053167","block_type":"box","text":"Appendix A.","page_number":216,"box":{"x":101,"y":484,"width":82,"height":10}},{"id":"c8afad28-0df9-4a7b-a49c-f6b4013e5626","block_type":"box","text":"BlackRock will cast votes on behalf of each of the Funds covered by this policy on specific proxy issues in","page_number":216,"box":{"x":135,"y":502,"width":751,"height":11}},{"id":"ff69a874-739d-4740-94e9-047af4151f45","block_type":"box","text":"respect of securities held by each such Fund (or may refrain from voting) in accordance with the Guidelines and","page_number":216,"box":{"x":102,"y":517,"width":791,"height":11}},{"id":"75554099-b8f4-4278-b366-9039864c7711","block_type":"box","text":"the BlackRock Climate and Decarbonization Stewardship Guidelines, as applicable.","page_number":216,"box":{"x":101,"y":532,"width":591,"height":11}},{"id":"ed8223c8-e0a3-4744-b67a-1585213c569e","block_type":"box","text":"Conflicts Management","page_number":216,"box":{"x":101,"y":550,"width":165,"height":11}},{"id":"043bb868-ce6c-457b-b40d-124cf0469d64","block_type":"box","text":"BlackRock Investment Stewardship (“BIS”) maintains policies and procedures that seek to prevent undue","page_number":216,"box":{"x":135,"y":569,"width":751,"height":11}},{"id":"6344a92e-ee60-4222-9044-95d56f46152f","block_type":"box","text":"influence on BlackRock’s proxy voting activity and to mitigate material conflicts of interest in the exercise of","page_number":216,"box":{"x":102,"y":584,"width":767,"height":11}},{"id":"59112999-f63c-44af-b3e4-23ec17c37d33","block_type":"box","text":"proxy voting responsibilities. 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In mitigating conflicts,","page_number":216,"box":{"x":101,"y":643,"width":800,"height":12}},{"id":"8e7211f4-8e65-45ae-ad91-19c6340d62c5","block_type":"box","text":"BIS will adhere to the Guidelines.","page_number":216,"box":{"x":102,"y":658,"width":235,"height":9}},{"id":"1c1d9bc2-401e-41f5-a661-01673977f4d0","block_type":"box","text":"In cer tain instances, BIS will engage an independent third-par ty voting service provider to make proxy voting","page_number":216,"box":{"x":135,"y":677,"width":769,"height":11}},{"id":"ba78ac44-9609-4b2a-aa93-e17f78edc73d","block_type":"box","text":"recommendations as a fur ther safeguard to avoid potential conflicts of interest, to satisfy regulatory compliance","page_number":216,"box":{"x":102,"y":692,"width":800,"height":11}},{"id":"e8e6e4b1-a79d-45e2-a6d3-acd50cb9c47a","block_type":"box","text":"requirements, or as may be otherwise required by applicable law.","page_number":216,"box":{"x":102,"y":707,"width":463,"height":11}},{"id":"034660cc-35d3-46e6-be4b-d363082f6e70","block_type":"box","text":"With respect to the relationship between securities lending and proxy voting, shares on loan cannot be voted","page_number":216,"box":{"x":134,"y":725,"width":774,"height":11}},{"id":"671f6d41-7809-41b6-9f9b-851865ade791","block_type":"box","text":"and BlackRock may determine to recall them for voting, as guided by BlackRock’s fiduciary responsibility to act","page_number":216,"box":{"x":102,"y":740,"width":791,"height":11}},{"id":"a7795488-3ba4-4024-8ccc-5267944452db","block_type":"box","text":"in clients’ financial interests. The Guidelines set for th BlackRock’s approach to recalling securities on loan in","page_number":216,"box":{"x":102,"y":755,"width":778,"height":11}},{"id":"f0558df7-4efd-4cf6-a488-75d608be1ef3","block_type":"box","text":"connection with proxy voting.","page_number":216,"box":{"x":101,"y":770,"width":203,"height":11}},{"id":"9937addf-facf-41a4-b5d6-18cdbda614e3","block_type":"box","text":"Reports to the Board","page_number":216,"box":{"x":102,"y":789,"width":153,"height":10}},{"id":"d0da91ce-9484-4089-9922-d192ea9054f4","block_type":"box","text":"BlackRock will repor t on an annual basis to the Directors on (1) a summary of the proxy voting process as","page_number":216,"box":{"x":135,"y":807,"width":755,"height":11}},{"id":"c8e0388f-a93c-429e-87a7-77a7ab53dd65","block_type":"box","text":"applicable to the Funds covered by this policy in the preceding year together with a representation that all 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As a fiduciary, BlackRock is legally required to make proxy voting determinations in a manner that is","page_number":221,"box":{"x":68,"y":60,"width":805,"height":11}},{"id":"dc9d33a6-9c43-45dc-95de-629a683ab576","block_type":"box","text":"consistent with the investment objectives of clients who have delegated voting authority to us. BIS’ Benchmark","page_number":221,"box":{"x":69,"y":75,"width":790,"height":11}},{"id":"977dcaa9-b715-46f2-8483-c971c44e3c89","block_type":"box","text":"Policies, and the vote decisions made consistent with those policies, reflect our reasonable and independent","page_number":221,"box":{"x":69,"y":90,"width":779,"height":11}},{"id":"747d6c82-05b3-479d-b0ce-c7c72b1ff141","block_type":"box","text":"judgment of what is in the long-term financial interests of clients. Our vote decisions are often informed by several","page_number":221,"box":{"x":67,"y":105,"width":816,"height":11}},{"id":"7a348c13-8426-4698-9727-74b5844ea312","block_type":"box","text":"factors, including in-depth analysis of company disclosures, comparisons against industry peers, third-par ty research,","page_number":221,"box":{"x":68,"y":120,"width":839,"height":12}},{"id":"5c1f75c0-3c42-40a2-ba3c-6b2b10c0dcf2","block_type":"box","text":"and, where appropriate, engagement with companies.","page_number":221,"box":{"x":69,"y":136,"width":381,"height":11}},{"id":"e36bd928-ec6d-4d25-8b1e-868bdc10c4e2","block_type":"box","text":"Generally, BIS suppor ts the vote recommendations of the board of directors and management at companies","page_number":221,"box":{"x":102,"y":158,"width":770,"height":11}},{"id":"392daff7-2471-49d1-8a73-34402635b967","block_type":"box","text":"which have sound corporate governance and deliver strong financial returns over time. 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These are topics that shareholders may have","page_number":221,"box":{"x":69,"y":475,"width":822,"height":12}},{"id":"3f88b9ff-be46-4bd2-a86b-ce061be4de57","block_type":"box","text":"the ability to vote on at shareholder meetings. These areas include:","page_number":221,"box":{"x":68,"y":491,"width":482,"height":11}},{"id":"5ef178f5-61a1-45f6-9bc4-d25fc9f7aed2","block_type":"box","text":"•","page_number":221,"box":{"x":69,"y":514,"width":6,"height":4}},{"id":"df349be0-123e-445b-8713-d257c6677005","block_type":"box","text":"Boards and directors","page_number":221,"box":{"x":102,"y":511,"width":147,"height":9}},{"id":"033fb030-0eb2-4bbf-8002-f0e22e071fa4","block_type":"box","text":"•","page_number":221,"box":{"x":69,"y":534,"width":6,"height":4}},{"id":"714ab4a5-a2e1-4fad-ae54-34a1d0081746","block_type":"box","text":"Auditors and audit-related issues","page_number":221,"box":{"x":101,"y":531,"width":234,"height":9}},{"id":"f96dd44a-3f7b-4add-9a1b-8c7e63ee9123","block_type":"box","text":"•","page_number":221,"box":{"x":69,"y":554,"width":6,"height":5}},{"id":"582e5258-e667-49bc-a632-046a76bb5262","block_type":"box","text":"Capital structure, mergers, acquisitions, asset sales, and other special situations","page_number":221,"box":{"x":102,"y":551,"width":583,"height":11}},{"id":"f67171ed-7bf3-46eb-bec9-a2ca05c4cc77","block_type":"box","text":"•","page_number":221,"box":{"x":69,"y":574,"width":6,"height":5}},{"id":"83f6a8cd-e8c3-4c07-9c2d-ef519ccc803c","block_type":"box","text":"Executive compensation","page_number":221,"box":{"x":102,"y":571,"width":170,"height":11}},{"id":"ca642622-463a-4ead-87c7-09f9ca3a3ef1","block_type":"box","text":"•","page_number":221,"box":{"x":69,"y":594,"width":6,"height":5}},{"id":"c62b727f-2966-45c8-b7cf-f425e66e7974","block_type":"box","text":"Shareholder protections and other significant corporate governance matters","page_number":221,"box":{"x":102,"y":591,"width":539,"height":12}},{"id":"c96d28c0-b2c0-4023-b659-398d2b68911e","block_type":"box","text":"•","page_number":221,"box":{"x":69,"y":614,"width":6,"height":5}},{"id":"8cb514f7-8549-43b6-ae9f-fdab5ce466bb","block_type":"box","text":"Shareholder proposals","page_number":221,"box":{"x":102,"y":612,"width":160,"height":11}},{"id":"c4ad404f-feef-4e97-b607-096ab9e9097b","block_type":"box","text":"The BIS Benchmark Policies are not prescriptive but rather are applied on a pragmatic basis, taking into","page_number":221,"box":{"x":101,"y":634,"width":740,"height":12}},{"id":"e895e851-51d1-4799-ada1-d600420fd687","block_type":"box","text":"consideration a number of company-specific factors, including the sector, market, and business environment within","page_number":221,"box":{"x":69,"y":649,"width":819,"height":12}},{"id":"099d9d09-8b56-4b16-ba9e-06ddd9b24b00","block_type":"box","text":"which companies operate.","page_number":221,"box":{"x":68,"y":665,"width":186,"height":10}},{"id":"e9381c31-170a-4a12-861e-a15403577df2","block_type":"box","text":"At the regional level, it is our view that companies should observe the accepted corporate governance standards","page_number":221,"box":{"x":101,"y":687,"width":803,"height":11}},{"id":"722e15fc-b83f-4c8c-bb55-262399d73247","block_type":"box","text":"in their domestic market at a minimum, and we ask that, if they do not, they explain how their approach better","page_number":221,"box":{"x":70,"y":702,"width":785,"height":11}},{"id":"a1e895fb-e82c-42c6-ba4e-587926686e63","block_type":"box","text":"suppor ts durable, long-term financial value creation. Our regional voting guidelines explain how the BIS Global","page_number":221,"box":{"x":69,"y":717,"width":781,"height":12}},{"id":"c6affb91-fd39-4b2b-8c21-00ef0080b7a2","block_type":"box","text":"Principles inform our voting decisions in relation to common ballot items for shareholder meetings in those markets.","page_number":221,"box":{"x":69,"y":732,"width":829,"height":12}},{"id":"2c746614-b21f-4b59-a5c3-ea09fec76cdf","block_type":"box","text":"4","page_number":221,"box":{"x":899,"y":733,"width":5,"height":4}},{"id":"00c00dff-09b1-48c5-b2db-bef3c6ab7298","block_type":"box","text":"3","page_number":221,"box":{"x":69,"y":762,"width":4,"height":5}},{"id":"9c0b7ff6-15ad-4fe0-92ed-2124e3915fdd","block_type":"box","text":"Examples include: Government of Canada, “Canada Business Corporations Act,” amended 2024; European Union,","page_number":221,"box":{"x":79,"y":762,"width":816,"height":11}},{"id":"a34bfda9-5391-4c2c-a9ab-f557d58a2973","block_type":"box","text":"“Shareholder Rights Directive II,” 2017; and the China Securities Regulatory Commission, “Code of Corporate","page_number":221,"box":{"x":70,"y":777,"width":784,"height":11}},{"id":"061de945-92fc-4a72-b209-89d8102dd4a0","block_type":"box","text":"Governance for Listed Companies in China,” 2001. Websites accessed in December 2025.","page_number":221,"box":{"x":69,"y":792,"width":650,"height":11}},{"id":"cee5937c-fe30-4bd9-b6e9-910b9fb8d5cc","block_type":"box","text":"4","page_number":221,"box":{"x":69,"y":810,"width":4,"height":4}},{"id":"1a43adbc-3b46-46dc-b24b-fea46efa95b6","block_type":"box","text":"Our regional voting guidelines reflect these different market standards and norms. Depending on the market,","page_number":221,"box":{"x":79,"y":810,"width":776,"height":11}},{"id":"860da1e1-61c4-43a2-89d6-ea1e96413d34","block_type":"box","text":"generally accepted practice is informed by corporate law, market regulation, best practices, and industry initiatives,","page_number":221,"box":{"x":68,"y":825,"width":821,"height":11}},{"id":"74551cd8-07dd-4d33-b788-bb8451ba2801","block_type":"box","text":"amongst other factors. BIS carries out engagement with companies, executes proxy votes, and conducts vote","page_number":221,"box":{"x":69,"y":840,"width":780,"height":11}},{"id":"6c6fc2c5-20ae-40ae-9360-3d89cfbe9a0a","block_type":"box","text":"operations (including maintaining records of votes cast) in a manner consistent with the relevant regional voting","page_number":221,"box":{"x":69,"y":855,"width":796,"height":11}},{"id":"8c1d18b9-e6b3-4a1f-b877-7f0ba5b0bc6b","block_type":"box","text":"guidelines.","page_number":221,"box":{"x":68,"y":870,"width":76,"height":11}},{"id":"04d530eb-0fbd-41d3-a3dc-f34b0f4a1a03","block_type":"box","text":"BlackRock Investment Stewardship","page_number":221,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"a8a1cd47-0ef9-4085-8cb1-4a8e7effb6fa","block_type":"box","text":"Global Principles | 4","page_number":221,"box":{"x":768,"y":942,"width":141,"height":13}},{"id":"7f30d73a-e6f3-4207-95bd-d782559de5e8","block_type":"box","text":"NM1026U-6033063-221/246","page_number":221,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"f116a607-faac-44a9-bfc2-8cdf7d0cf56e","block_type":"box","text":"BOARDS AND DIRECTORS","page_number":222,"box":{"x":394,"y":45,"width":190,"height":9}},{"id":"5660c3bf-0f4c-40cd-b2a4-803e7967252a","block_type":"box","text":"Oversight role of the board","page_number":222,"box":{"x":69,"y":75,"width":194,"height":11}},{"id":"5b2986af-3201-4c1f-a086-6d5ff2d0580f","block_type":"box","text":"Companies whose boards are comprised of appropriately qualified, engaged directors with professional","page_number":222,"box":{"x":102,"y":98,"width":734,"height":11}},{"id":"c3637d44-7084-40de-81a1-737900b53492","block_type":"box","text":"characteristics relevant to a company’s business enhance the board’s ability to add long-term financial value and","page_number":222,"box":{"x":69,"y":113,"width":806,"height":11}},{"id":"0c0fc015-9529-4b29-896a-bd3aedca5ef3","block_type":"box","text":"serve as the voice of shareholders in board discussions. In our view, a strong board gives a company a competitive","page_number":222,"box":{"x":69,"y":128,"width":822,"height":11}},{"id":"453c286a-ac10-46d0-85f9-d6b091492611","block_type":"box","text":"advantage, providing valuable oversight and contributing to the most impor tant management decisions that suppor t","page_number":222,"box":{"x":69,"y":143,"width":825,"height":11}},{"id":"6723ee4c-7adf-4205-a8e6-64087da29fe2","block_type":"box","text":"long-term financial per formance.","page_number":222,"box":{"x":70,"y":158,"width":229,"height":11}},{"id":"41a2fac5-e5a6-490b-b9a3-56c4b8de68d5","block_type":"box","text":"For this reason, our investment stewardship effor ts focus on the effectiveness of the board of directors. We","page_number":222,"box":{"x":102,"y":181,"width":771,"height":11}},{"id":"6bf6ba84-0c9a-4e8b-9e8d-a31e6525993f","block_type":"box","text":"engage, as necessary, with members of the board’s nominating and/or governance committee to assess whether","page_number":222,"box":{"x":69,"y":196,"width":811,"height":11}},{"id":"5434e837-5bbb-4ced-b9d1-0dde833639c2","block_type":"box","text":"governance practices and board composition are effective given a company’s business model, sector, market, and","page_number":222,"box":{"x":68,"y":211,"width":817,"height":11}},{"id":"3cc151b0-d8c4-455a-8e54-a431843c7e3a","block_type":"box","text":"the business environment in which a company is operating.","page_number":222,"box":{"x":68,"y":226,"width":422,"height":11}},{"id":"f7261bf4-86a1-4ccc-9b5c-05eb51c95683","block_type":"box","text":"We consider it good practice when the board establishes and maintains a framework of robust and effective","page_number":222,"box":{"x":101,"y":249,"width":770,"height":11}},{"id":"e6893331-e22a-455d-8eb2-aa466fab5716","block_type":"box","text":"governance mechanisms that suppor ts its oversight of the company’s strategy and operations, consistent with the","page_number":222,"box":{"x":68,"y":264,"width":817,"height":11}},{"id":"0ec57846-104c-49eb-be2f-2b0ba7b67fea","block_type":"box","text":"long-term financial interests of investors. This includes having clear descriptions of the role of the board and the","page_number":222,"box":{"x":70,"y":279,"width":799,"height":11}},{"id":"11fa69c0-30f9-4aa6-a236-09bb1a12df53","block_type":"box","text":"committees of the board and how directors engage with and oversee management, as well as disclosure of material","page_number":222,"box":{"x":69,"y":294,"width":827,"height":11}},{"id":"4e732c51-943a-416a-9ab4-504851dfa6c5","block_type":"box","text":"risks that may affect a company’s long-term strategy and how management is effectively identifying, managing, and","page_number":222,"box":{"x":69,"y":309,"width":822,"height":11}},{"id":"bdd927f6-2467-46f6-adf3-d5e649f32407","block_type":"box","text":"mitigating such risks.","page_number":222,"box":{"x":69,"y":325,"width":150,"height":11}},{"id":"0219bff2-9967-4182-9969-cff7b13898af","block_type":"box","text":"Understanding management’s long-term strategy and the milestones against which investors should assess its","page_number":222,"box":{"x":102,"y":347,"width":791,"height":11}},{"id":"fe6b8c7a-264e-4f9c-9116-007561fc3f36","block_type":"box","text":"implementation is central to our approach. If any strategic targets are significantly missed or materially restated, we","page_number":222,"box":{"x":70,"y":362,"width":826,"height":11}},{"id":"ff7dac2b-f66b-401c-b98f-68413841bfb7","block_type":"box","text":"find it helpful when company disclosures provide a detailed explanation of the changes and an indication of the","page_number":222,"box":{"x":68,"y":377,"width":793,"height":12}},{"id":"3f372954-d9f5-441d-80af-34abe56f50c8","block_type":"box","text":"board’s role in reviewing the revised targets. We look to the board to ar ticulate the effectiveness of these","page_number":222,"box":{"x":69,"y":392,"width":755,"height":12}},{"id":"6f8643f2-5e07-41aa-b361-a6848a3523a7","block_type":"box","text":"mechanisms in overseeing the management of business risks and oppor tunities and the fulfillment of the company’s","page_number":222,"box":{"x":69,"y":407,"width":835,"height":12}},{"id":"40e5e8b6-def0-438d-9094-c2d3de31f0e3","block_type":"box","text":"strategy.","page_number":222,"box":{"x":69,"y":423,"width":58,"height":11}},{"id":"8d3f9765-3c0a-418a-a604-2ce51808fadc","block_type":"box","text":"Where a company has not adequately disclosed or demonstrated that its board has fulfilled these corporate","page_number":222,"box":{"x":101,"y":445,"width":769,"height":11}},{"id":"720a5c98-5037-4d3a-9702-4a069ea7d9a5","block_type":"box","text":"governance and risk oversight responsibilities, we may consider not suppor ting the election of directors who, in our","page_number":222,"box":{"x":68,"y":460,"width":823,"height":12}},{"id":"9efceefb-fc14-4508-93fc-7508dab473e1","block_type":"box","text":"assessment, have par ticular responsibility for the issues.","page_number":222,"box":{"x":69,"y":475,"width":409,"height":12}},{"id":"98a2bb28-63d5-46d8-afd1-7d7e0403072c","block_type":"box","text":"When casting vote decisions on behalf of clients on the election of directors, some of the factors that speak to","page_number":222,"box":{"x":101,"y":498,"width":791,"height":11}},{"id":"dbe5937c-f2bd-42a0-8f5f-b0ce52ab696f","block_type":"box","text":"the board’s effectiveness as a group include the relevance of individual directors’ qualifications and skillsets, as well","page_number":222,"box":{"x":68,"y":513,"width":836,"height":12}},{"id":"d1684c73-5981-4231-910e-a9058322e8e0","block_type":"box","text":"as directors’ capacity and other time commitments, and how these factors may contribute to the company’s financial","page_number":222,"box":{"x":69,"y":528,"width":833,"height":12}},{"id":"0b8442b0-2f59-43bc-baa0-317fa5c60403","block_type":"box","text":"per formance. We look to boards to establish formal and transparent processes for nominating directors that reflect","page_number":222,"box":{"x":70,"y":543,"width":823,"height":12}},{"id":"895bf2cb-4c69-4a9d-8572-f69af5de759a","block_type":"box","text":"the company’s long-term strategy and business model.","page_number":222,"box":{"x":68,"y":559,"width":390,"height":11}},{"id":"cef1c6c9-ac1d-438d-92a0-a6768385719b","block_type":"box","text":"In the section titled “Board quality and effectiveness” below, we provide more detail about our approach to board","page_number":222,"box":{"x":102,"y":581,"width":807,"height":11}},{"id":"0d6b594f-a1ec-4e82-abd6-399202186c35","block_type":"box","text":"composition and how it underpins board effectiveness and long-term financial value creation.","page_number":222,"box":{"x":69,"y":596,"width":662,"height":12}},{"id":"c197475e-7545-4e59-ad42-99bca59c594b","block_type":"box","text":"Regular accountability through director elections","page_number":222,"box":{"x":69,"y":627,"width":358,"height":11}},{"id":"28bf2006-0e5d-49f0-8b23-67f9259dc182","block_type":"box","text":"The election of directors to the board is a right of shareholders and an impor tant signal of suppor t for, or","page_number":222,"box":{"x":101,"y":649,"width":750,"height":12}},{"id":"11bd8f41-6267-40ed-87e0-e9a03a5fb414","block_type":"box","text":"concern about, the per formance of the board in overseeing and advising management. To ensure accountability for","page_number":222,"box":{"x":69,"y":664,"width":819,"height":12}},{"id":"daef71b2-9675-4293-89f1-b4a34c5a6525","block_type":"box","text":"their decisions on behalf of shareholders, directors should stand for election on a regular basis, ideally annually.","page_number":222,"box":{"x":68,"y":680,"width":802,"height":11}},{"id":"c21a4256-7b18-4c92-a348-eb8b1a96724d","block_type":"box","text":"5","page_number":222,"box":{"x":872,"y":680,"width":4,"height":4}},{"id":"5478d4d2-af3f-4819-ab4f-7ded1b24ea84","block_type":"box","text":"Annual director elections allow shareholders to reaffirm their suppor t for, or concerns about, board members’","page_number":222,"box":{"x":68,"y":695,"width":782,"height":11}},{"id":"39f7d63b-15d9-4032-b38a-9fba088adbc9","block_type":"box","text":"decisions in a timely manner. When board members are not elected annually, we consider it good practice for boards","page_number":222,"box":{"x":69,"y":710,"width":832,"height":11}},{"id":"f3b67c52-cecb-4f3d-a652-a6c871ee17c1","block_type":"box","text":"to have a rotation policy to ensure that, through a board cycle, all directors have had their appointment re-confirmed,","page_number":222,"box":{"x":68,"y":725,"width":832,"height":11}},{"id":"a3fb8f43-0a87-4107-a98f-4ac080847487","block_type":"box","text":"with a propor tion of directors being put forward for election at each shareholder meeting.","page_number":222,"box":{"x":68,"y":740,"width":636,"height":11}},{"id":"473e11de-1d01-48bc-bb1c-1f9fd2633a22","block_type":"box","text":"BOARD QUALITY AND EFFECTIVENESS","page_number":222,"box":{"x":348,"y":770,"width":282,"height":11}},{"id":"c163c41a-5315-46b9-983a-2c539cee2e4a","block_type":"box","text":"Regular director elections also give boards the oppor tunity to adjust their composition in an orderly way to reflect","page_number":222,"box":{"x":102,"y":793,"width":805,"height":11}},{"id":"a17002b6-fe60-48b9-b109-2c8f0e29bcc4","block_type":"box","text":"developments in the company’s strategy and the market environment. In our view, it is beneficial for new directors to","page_number":222,"box":{"x":69,"y":808,"width":831,"height":11}},{"id":"9ccbef92-402b-4dfa-a1a3-076a67b991cc","block_type":"box","text":"be brought onto the board periodically to refresh the group’s thinking, while suppor ting both continuity and","page_number":222,"box":{"x":69,"y":823,"width":758,"height":12}},{"id":"63d0f0d2-7483-450a-b4a9-2692da1a6c67","block_type":"box","text":"5","page_number":222,"box":{"x":69,"y":853,"width":4,"height":4}},{"id":"162491b6-045b-406e-8069-3277f33edf10","block_type":"box","text":"In most markets, directors stand for re-election on an annual or triennial basis, as determined by corporate law,","page_number":222,"box":{"x":79,"y":852,"width":795,"height":12}},{"id":"9f758bdd-613c-403d-b037-66d325b02fa3","block_type":"box","text":"market regulation or voluntary best practice.","page_number":222,"box":{"x":69,"y":868,"width":314,"height":11}},{"id":"41796b44-faa0-4c16-ae78-a9d430ba21d5","block_type":"box","text":"BlackRock Investment Stewardship","page_number":222,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"809b0fd4-ff7e-4701-9b8a-8db300c34586","block_type":"box","text":"Global Principles | 5","page_number":222,"box":{"x":768,"y":942,"width":141,"height":13}},{"id":"5c631156-644d-4b7c-93f3-f5e062edd9ef","block_type":"box","text":"NM1026U-6033063-222/246","page_number":222,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"2fd81e9b-388f-48ae-8031-fb54a0187493","block_type":"box","text":"appropriate succession planning. We consider the average overall tenure of the board and seek a balance between","page_number":223,"box":{"x":69,"y":45,"width":819,"height":11}},{"id":"4fd0c47e-de75-4127-ab2e-738a4538ea39","block_type":"box","text":"the knowledge and experience of longer-serving directors and the fresh perspectives of directors who joined more","page_number":223,"box":{"x":68,"y":60,"width":809,"height":11}},{"id":"5098698b-774a-40cd-9f85-97cc04a6821f","block_type":"box","text":"recently.","page_number":223,"box":{"x":69,"y":75,"width":57,"height":11}},{"id":"d41bdb40-68b1-4f96-af1c-eab058da3592","block_type":"box","text":"We appreciate when companies regularly review and assess how directors nominated for election contribute to","page_number":223,"box":{"x":101,"y":98,"width":789,"height":11}},{"id":"a43655a7-d377-4698-a33a-3b65b1511efb","block_type":"box","text":"the effectiveness of the board. In our view, the company’s assessment should consider a number of factors,","page_number":223,"box":{"x":68,"y":113,"width":774,"height":11}},{"id":"44211b42-c8dc-4802-861f-7d48b9432772","block_type":"box","text":"including each director’s independence and time commitments, as well as the breadth and relevance of director","page_number":223,"box":{"x":70,"y":128,"width":798,"height":11}},{"id":"4dd28d79-0aca-4418-9197-315a41ec53ac","block_type":"box","text":"experiences and skillsets, and how these collectively contribute to the board’s effectiveness in advising and","page_number":223,"box":{"x":69,"y":143,"width":770,"height":11}},{"id":"cc1df605-ee4f-48ad-935e-8b7044f599b2","block_type":"box","text":"overseeing management in delivering long-term financial returns.","page_number":223,"box":{"x":69,"y":158,"width":459,"height":11}},{"id":"6091260e-4837-4d09-b919-c4dc990569f9","block_type":"box","text":"Director independence","page_number":223,"box":{"x":69,"y":188,"width":164,"height":11}},{"id":"a6d2c7c1-9c8e-430a-a7d1-2941cb87eb55","block_type":"box","text":"Director independence — from management, significant shareholders, or other related par ties — is a central","page_number":223,"box":{"x":102,"y":211,"width":777,"height":11}},{"id":"c04f665d-820e-41ce-95a1-67add0df405a","block_type":"box","text":"tenet of sound corporate governance across markets.","page_number":223,"box":{"x":68,"y":226,"width":382,"height":11}},{"id":"ae51cbac-45ec-45b0-97fa-ab15481651e9","block_type":"box","text":"6","page_number":223,"box":{"x":452,"y":226,"width":4,"height":5}},{"id":"7301c7a2-050e-4b0f-8de4-584e83476b40","block_type":"box","text":"We look to boards to have a sufficient number of independent","page_number":223,"box":{"x":462,"y":226,"width":442,"height":11}},{"id":"4fd125dc-5431-40a2-aab1-1af56dc026e1","block_type":"box","text":"directors, free from conflicts of interest or undue influence, to ensure objectivity in the decision-making of the board","page_number":223,"box":{"x":69,"y":241,"width":825,"height":11}},{"id":"cab14736-fcdc-4f87-b545-420dfb5eb282","block_type":"box","text":"and its ability to oversee management. We generally consider it good practice for independent directors to make a","page_number":223,"box":{"x":69,"y":256,"width":813,"height":12}},{"id":"b2c6cb5b-7af6-4b57-b851-41f56764e62b","block_type":"box","text":"majority of the board, or in the case of controlled companies, at least one-third.","page_number":223,"box":{"x":69,"y":271,"width":566,"height":12}},{"id":"b79bdee8-9cbe-400a-999f-1358621428cd","block_type":"box","text":"Common impediments to independence may include but are not limited to:","page_number":223,"box":{"x":102,"y":294,"width":531,"height":11}},{"id":"3d35a83e-62b3-46eb-870f-d613a678c578","block_type":"box","text":"•","page_number":223,"box":{"x":69,"y":317,"width":6,"height":5}},{"id":"dfac41dc-abe3-4431-8fca-72dcb19bd000","block_type":"box","text":"Current or recent employment at the company or a subsidiary","page_number":223,"box":{"x":102,"y":314,"width":438,"height":11}},{"id":"f391c338-d575-4a3d-9343-b524cfa46042","block_type":"box","text":"•","page_number":223,"box":{"x":69,"y":337,"width":6,"height":5}},{"id":"72a4a3a0-d1ff-4eb9-aa23-68ec4c1cddba","block_type":"box","text":"Being, or representing, a shareholder with a substantial shareholding in the company","page_number":223,"box":{"x":102,"y":335,"width":606,"height":11}},{"id":"c7e8cb0b-4034-4230-94ae-6005083eaa59","block_type":"box","text":"•","page_number":223,"box":{"x":69,"y":357,"width":6,"height":5}},{"id":"35e0010e-0db4-49f4-b43f-a1b090782a1a","block_type":"box","text":"Interlocking directorates","page_number":223,"box":{"x":102,"y":355,"width":170,"height":11}},{"id":"80cbf52b-d76e-4b0b-a31d-26cd256b5ab7","block_type":"box","text":"•","page_number":223,"box":{"x":69,"y":378,"width":6,"height":4}},{"id":"4aa795a4-bb3f-428c-b1e0-6a0378530e42","block_type":"box","text":"Having any other interest, business, or other relationship which could, or could reasonably be perceived to,","page_number":223,"box":{"x":102,"y":375,"width":761,"height":11}},{"id":"3279524d-602a-4b7f-9f1c-659b788c7527","block_type":"box","text":"materially inter fere with a director’s ability to act in the best interests of the company and shareholders","page_number":223,"box":{"x":102,"y":390,"width":738,"height":11}},{"id":"d89479be-733f-4f7b-ae4b-4874eb49adb8","block_type":"box","text":"In our experience, boards are most effective at overseeing and advising management when there is a senior,","page_number":223,"box":{"x":102,"y":412,"width":775,"height":12}},{"id":"db3d1d95-72d8-4ede-83b1-3517eace36c9","block_type":"box","text":"independent board leader. This director may chair the board, or, where the chair is also the CEO (or is otherwise not","page_number":223,"box":{"x":70,"y":428,"width":827,"height":11}},{"id":"49c9b9ab-433b-44ba-b02f-c0bc39c5339c","block_type":"box","text":"independent), be designated as a lead independent director. The role of this director is to suppor t independent board","page_number":223,"box":{"x":70,"y":443,"width":835,"height":11}},{"id":"d6c5c1aa-fca6-47f6-a48b-549f5457a3fb","block_type":"box","text":"members in fulfilling their oversight responsibilities effectively by shaping the agenda, ensuring adequate information","page_number":223,"box":{"x":69,"y":458,"width":834,"height":11}},{"id":"cbb45bb2-6855-4f21-8385-a9b717988ca4","block_type":"box","text":"is provided to the board, and encouraging independent director par ticipation in board deliberations. We appreciate","page_number":223,"box":{"x":70,"y":473,"width":813,"height":11}},{"id":"1c449e92-ec24-4a0c-8e63-28663e3a3b77","block_type":"box","text":"when the lead independent director or another appropriate director is available to meet with shareholders to explain","page_number":223,"box":{"x":68,"y":488,"width":826,"height":11}},{"id":"78d43955-b13e-429c-8122-e344c8ad6fb9","block_type":"box","text":"and contextualize a company’s approach as a situation warrants.","page_number":223,"box":{"x":69,"y":503,"width":463,"height":11}},{"id":"b6fb2f07-9692-42c9-af08-e111198ebaeb","block_type":"box","text":"Boards may face matters that could involve conflicts of interest for executives or affiliated directors, or that","page_number":223,"box":{"x":102,"y":526,"width":765,"height":11}},{"id":"ede3ec3a-773a-4d2a-be59-61f0c0a49411","block_type":"box","text":"require additional focus. It is our view that objective oversight of such matters is best achieved when the board forms","page_number":223,"box":{"x":69,"y":541,"width":837,"height":11}},{"id":"6a391564-c68b-4ca9-bc93-a45cdf67bf2c","block_type":"box","text":"committees with a majority of independent directors, depending on market norms and a company’s ownership","page_number":223,"box":{"x":69,"y":556,"width":784,"height":11}},{"id":"277fd974-bd5d-44e8-8cad-bd69dda2e1d3","block_type":"box","text":"structure. In many markets, these committees of the board specialize in audit, director nominations, and","page_number":223,"box":{"x":69,"y":571,"width":747,"height":11}},{"id":"ab5e398c-05c6-4df7-a8f4-c7db1c2133bc","block_type":"box","text":"compensation matters, among others. An ad hoc committee might also be formed to decide on a special transaction,","page_number":223,"box":{"x":69,"y":586,"width":836,"height":12}},{"id":"168b6631-794c-4190-ba44-b0606fc77a42","block_type":"box","text":"par ticularly one involving a related par ty, or to investigate a significant adverse event.","page_number":223,"box":{"x":70,"y":601,"width":607,"height":12}},{"id":"5fc1c532-0ef4-4ea5-9bbd-d23d0bc6e894","block_type":"box","text":"Sufficient capacity","page_number":223,"box":{"x":68,"y":632,"width":137,"height":11}},{"id":"3d26ec37-02dc-4d97-a920-f627d4847fc1","block_type":"box","text":"As the role and expectations of a director are increasingly demanding, directors must be able to commit an","page_number":223,"box":{"x":101,"y":654,"width":763,"height":12}},{"id":"c95a2ba0-b3d6-4235-898e-b827ce6c0363","block_type":"box","text":"appropriate amount of time to board and committee matters. It is impor tant that directors have the capacity to meet","page_number":223,"box":{"x":69,"y":669,"width":830,"height":12}},{"id":"029e0f46-0751-4162-b16f-2881387b04dd","block_type":"box","text":"all of their responsibilities — including when there are unforeseen events — and therefore, we consider it best","page_number":223,"box":{"x":69,"y":685,"width":791,"height":11}},{"id":"be89611e-bb50-40ec-a033-4bcbc9747d0c","block_type":"box","text":"practice when they don’t take on an excessive number of roles that would impair their ability to fulfill their duties.","page_number":223,"box":{"x":70,"y":700,"width":804,"height":11}},{"id":"945eec7f-f20b-4bed-ac61-7c1d1ec29494","block_type":"box","text":"Board composition","page_number":223,"box":{"x":69,"y":730,"width":135,"height":11}},{"id":"71d2b37f-109d-4da8-a129-763058c885e9","block_type":"box","text":"In assessing board composition, we take into account a company’s board size, business model, strategy, market","page_number":223,"box":{"x":102,"y":753,"width":806,"height":11}},{"id":"9734b8c2-2fb1-4ec2-80a5-ad33d077d48c","block_type":"box","text":"capitalization, and ownership structure, as well as the market in which the company operates. We find it helpful when","page_number":223,"box":{"x":69,"y":768,"width":836,"height":11}},{"id":"f25d5985-0057-4aa1-a675-73e9107c5ef1","block_type":"box","text":"companies explain how their approach to board composition suppor ts the company’s governance practices.","page_number":223,"box":{"x":69,"y":783,"width":767,"height":11}},{"id":"37f3a56c-24dd-45ad-b695-73667f631dc5","block_type":"box","text":"When nominating directors to the board, we look to companies to provide sufficient information on the individual","page_number":223,"box":{"x":101,"y":806,"width":802,"height":11}},{"id":"b60b9867-aa76-4986-ad6d-2e7d918eb640","block_type":"box","text":"candidates so that shareholders can assess the capabilities and suitability of each individual nominee and their fit","page_number":223,"box":{"x":69,"y":821,"width":818,"height":11}},{"id":"1c70f9c8-6550-4b8a-ab27-b4809b963e9e","block_type":"box","text":"within overall board composition. These disclosures should explain how the collective experience and exper tise of the","page_number":223,"box":{"x":68,"y":836,"width":840,"height":11}},{"id":"af7e703d-1abb-4849-b82d-403e7c4a7fb4","block_type":"box","text":"board, as well as the par ticular skillsets of individual directors, aligns with the company’s long-term strategy. Highly","page_number":223,"box":{"x":69,"y":851,"width":823,"height":11}},{"id":"c737cade-a1ed-4366-b853-5e5ef0fc9e67","block_type":"box","text":"6","page_number":223,"box":{"x":69,"y":881,"width":4,"height":4}},{"id":"fcf818dd-2462-431d-bea0-d93a1358ed4f","block_type":"box","text":"For example, please see: Tokyo Stock Exchange, “Japan’s Corporate Governance Code,” June 11, 2021; Financial","page_number":223,"box":{"x":79,"y":880,"width":813,"height":11}},{"id":"c9a9799c-2536-4553-bd06-4205980f792c","block_type":"box","text":"Repor ting Council, “UK Corporate Governance Code,” January 2024, accessed in December 2025.","page_number":223,"box":{"x":70,"y":895,"width":704,"height":12}},{"id":"8cf3d360-4d22-4639-a5a6-ed524ce68118","block_type":"box","text":"BlackRock Investment Stewardship","page_number":223,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"26d75861-a759-4bb5-b8ed-2ea399df09e4","block_type":"box","text":"Global Principles | 6","page_number":223,"box":{"x":768,"y":942,"width":141,"height":13}},{"id":"79f597da-b24d-4ca1-8d46-278569815eba","block_type":"box","text":"NM1026U-6033063-223/246","page_number":223,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"7d8e79fc-e7d0-456e-985f-1608989d6918","block_type":"box","text":"qualified, engaged directors with professional characteristics relevant to a company’s business and strategy enhance","page_number":224,"box":{"x":69,"y":45,"width":836,"height":11}},{"id":"f51deac4-163e-43a7-926a-2c020fa1b07d","block_type":"box","text":"the ability of the board to add value and be the voice of shareholders in board discussions.","page_number":224,"box":{"x":68,"y":60,"width":650,"height":11}},{"id":"5d4632e9-6b8a-44bc-97b9-19a7fefcf7c1","block_type":"box","text":"It is in this context that we are interested in a variety of experiences, perspectives, and skillsets in the board","page_number":224,"box":{"x":102,"y":82,"width":775,"height":12}},{"id":"6338ec87-8bc0-4e91-b360-dc800191d84a","block_type":"box","text":"room. We see it as a means of avoiding “group think” in the board’s exercise of its responsibilities to advise and","page_number":224,"box":{"x":69,"y":98,"width":806,"height":11}},{"id":"ca18874a-8fdc-43bf-a0b3-e72eba2b8953","block_type":"box","text":"oversee management. We note that in many markets, policymakers have set board gender diversity goals which we","page_number":224,"box":{"x":69,"y":113,"width":820,"height":11}},{"id":"934ae4a3-9b9e-476c-b28a-aca9eca9bdf2","block_type":"box","text":"may discuss with companies, par ticularly if there is a risk their board composition may be misaligned.","page_number":224,"box":{"x":69,"y":128,"width":726,"height":11}},{"id":"eb10bda8-4a8e-401e-9ba5-34f2fc358673","block_type":"box","text":"AUDITORS AND AUDIT-RELATED ISSUES","page_number":224,"box":{"x":342,"y":158,"width":293,"height":9}},{"id":"34bebfec-1033-4333-90dc-2175dc1bc39f","block_type":"box","text":"BIS recognizes the critical impor tance of financial statements to provide a complete and accurate por trayal of a","page_number":224,"box":{"x":102,"y":181,"width":795,"height":11}},{"id":"e1df8550-d79c-43e5-9462-93b3139f3abf","block_type":"box","text":"company’s financial condition. Accordingly, we look for the assumptions made by management, and reviewed by the","page_number":224,"box":{"x":69,"y":196,"width":825,"height":11}},{"id":"95e8b504-e132-4cb9-98e7-304834981577","block_type":"box","text":"auditor in preparing the financial statements, to be reasonable and justified.","page_number":224,"box":{"x":69,"y":211,"width":543,"height":11}},{"id":"51961db9-1489-4f91-acb6-3d9753428bb7","block_type":"box","text":"We view the audit committee, or its equivalent, as responsible for overseeing the management of the","page_number":224,"box":{"x":101,"y":234,"width":722,"height":11}},{"id":"df722472-cc3e-4e3c-abd9-20dc4ec8ffd0","block_type":"box","text":"independent auditor and the internal audit function at a company. The committee plays an impor tant role in a","page_number":224,"box":{"x":70,"y":249,"width":778,"height":11}},{"id":"98d7b2c4-540c-420b-b3c9-1a626eb4762b","block_type":"box","text":"company’s financial repor ting system by providing independent oversight of the accounts, material financial, and,","page_number":224,"box":{"x":69,"y":264,"width":806,"height":11}},{"id":"40506ed6-0a06-4185-8987-01e5274edc11","block_type":"box","text":"where appropriate to the jurisdiction, non-financial information and internal control frameworks. Moreover, in the","page_number":224,"box":{"x":68,"y":279,"width":799,"height":11}},{"id":"94977b35-1d2f-4bad-8486-c47dc602492a","block_type":"box","text":"absence of a dedicated risk committee, these committees can provide oversight of Enterprise Risk Management","page_number":224,"box":{"x":69,"y":294,"width":801,"height":11}},{"id":"bfbd9017-fe04-472a-a06e-bccb685478ea","block_type":"box","text":"systems.","page_number":224,"box":{"x":69,"y":310,"width":62,"height":10}},{"id":"64fdd826-c09c-4d0c-916b-d819b4b3399c","block_type":"box","text":"7","page_number":224,"box":{"x":133,"y":310,"width":4,"height":4}},{"id":"c957020d-2247-4978-b9af-ef919ac8f302","block_type":"box","text":"In our view, effective audit committee oversight strengthens the quality and reliability of a company’s","page_number":224,"box":{"x":144,"y":309,"width":717,"height":11}},{"id":"2a8e4cdf-70ac-41e5-b078-0092352b9499","block_type":"box","text":"financial statements and provides an impor tant level of reassurance to shareholders.","page_number":224,"box":{"x":68,"y":324,"width":609,"height":11}},{"id":"e93daadc-4348-4e88-9e87-534a85d490e7","block_type":"box","text":"We look to audit committees, or their equivalent, to have clearly ar ticulated char ters that set out their","page_number":224,"box":{"x":101,"y":347,"width":727,"height":11}},{"id":"5e880aba-8d33-4ca4-aa57-21b5a4c662a8","block_type":"box","text":"responsibilities. Additionally, having a rotation plan can periodically refresh the committee membership and introduce","page_number":224,"box":{"x":69,"y":362,"width":835,"height":11}},{"id":"1960148f-7eab-4c37-baf6-efc4836ec681","block_type":"box","text":"new perspectives. We recognize that audit committees will rely on management, internal audit, and the independent","page_number":224,"box":{"x":69,"y":377,"width":827,"height":12}},{"id":"8455fd43-efce-4a38-85ec-43a644156c68","block_type":"box","text":"auditor to fulfill their responsibilities. However, we look to committee members to demonstrate they have relevant","page_number":224,"box":{"x":69,"y":392,"width":810,"height":12}},{"id":"477ff7ed-c4f0-416a-954a-6dc5fcc1f63e","block_type":"box","text":"exper tise to monitor and oversee the audit process and related activities.","page_number":224,"box":{"x":69,"y":408,"width":523,"height":10}},{"id":"40ccf59c-7800-4260-8d54-6784f96c06b0","block_type":"box","text":"We take par ticular note of unexplained changes in repor ting methodology, cases involving significant financial","page_number":224,"box":{"x":101,"y":430,"width":780,"height":11}},{"id":"4eeaa504-7890-4efb-9a27-b73db4e3fa83","block_type":"box","text":"restatements, or ad hoc notifications of material financial weakness. In this respect, we look to audit committees to","page_number":224,"box":{"x":69,"y":445,"width":828,"height":11}},{"id":"a9482ba4-6b96-43b3-a850-e3c2776d8dec","block_type":"box","text":"provide timely disclosure on the remediation of key and critical audit matters identified either by the external auditor","page_number":224,"box":{"x":70,"y":460,"width":827,"height":12}},{"id":"fa2dc611-9c4d-4b98-b5bc-49757c058825","block_type":"box","text":"or internal audit function.","page_number":224,"box":{"x":69,"y":475,"width":178,"height":9}},{"id":"f68b7a02-30e8-4d09-90cd-b24099206561","block_type":"box","text":"The integrity of financial statements depends on the auditor being free of any impediments that could","page_number":224,"box":{"x":101,"y":498,"width":723,"height":11}},{"id":"8d4bf375-9696-4d12-a6ff-f500b4c22865","block_type":"box","text":"compromise its ability to serve as an effective check on management. To that end, it is impor tant that auditors are,","page_number":224,"box":{"x":69,"y":513,"width":825,"height":12}},{"id":"f92e7fc9-01e9-4067-94e4-1908d8ff6cf2","block_type":"box","text":"and are seen to be, independent. Where an audit firm provides services to the company in addition to the audit, we","page_number":224,"box":{"x":69,"y":528,"width":824,"height":12}},{"id":"1beb5d41-0a07-4f94-94aa-647f4800fdf8","block_type":"box","text":"look for the fees earned to be disclosed and explained. We look for audit committees to have in place a procedure for","page_number":224,"box":{"x":70,"y":543,"width":839,"height":11}},{"id":"6a1ec460-6b6a-4ca6-9ff7-2dab050ef129","block_type":"box","text":"assessing the independence of the auditor and the quality of the external audit process on an annual basis.","page_number":224,"box":{"x":69,"y":559,"width":770,"height":11}},{"id":"cc9b2338-ddca-4fc3-8269-0b516170a260","block_type":"box","text":"Comprehensive disclosure provides investors with an understanding of the company’s long-term operational risk","page_number":224,"box":{"x":102,"y":581,"width":799,"height":12}},{"id":"bfad58c3-a937-41df-936b-c64f3d9b8fdb","block_type":"box","text":"management practices and, more broadly, the quality of the board’s oversight. We look to the audit or risk committee","page_number":224,"box":{"x":69,"y":596,"width":836,"height":12}},{"id":"7c4b9360-ea1f-40b9-8e4f-5d0ad5ce1447","block_type":"box","text":"to periodically review the company’s risk assessment and risk management policies and the significant risks and","page_number":224,"box":{"x":68,"y":612,"width":806,"height":11}},{"id":"cd4fe4ad-e6ba-4a07-9f25-98cf94d37ef5","block_type":"box","text":"exposures identified by management, the internal auditors or the independent auditors, and management’s steps to","page_number":224,"box":{"x":69,"y":627,"width":829,"height":11}},{"id":"e1eebc2c-f51a-473d-a19f-25c6d06b1c78","block_type":"box","text":"address them. In the absence of detailed disclosures, we may conclude that companies are not adequately managing","page_number":224,"box":{"x":69,"y":642,"width":840,"height":11}},{"id":"ca2f9ff6-fdc8-48e8-9bc1-cdd9277c13d2","block_type":"box","text":"risk.","page_number":224,"box":{"x":69,"y":657,"width":28,"height":9}},{"id":"979d4c18-e11a-4a49-bc72-ec3e8f115653","block_type":"box","text":"CAPITAL STRUCTURE, MERGERS, ACQUISITIONS, ASSET SALES, AND OTHER SPECIAL SITUATIONS","page_number":224,"box":{"x":125,"y":687,"width":728,"height":11}},{"id":"94709bfa-af8f-4feb-afe5-266cc9236806","block_type":"box","text":"The capital structure of a company is critical to shareholders as it impacts the value of their investment and the","page_number":224,"box":{"x":101,"y":710,"width":798,"height":11}},{"id":"f5957fa0-8462-4927-9cee-86fbb123f0dc","block_type":"box","text":"priority of their interest in the company relative to that of other equity or debt investors. Pre-emptive rights are a key","page_number":224,"box":{"x":70,"y":725,"width":824,"height":11}},{"id":"019be7e9-fe7c-4511-8ac6-7982d01d4826","block_type":"box","text":"protection for shareholders against the dilution of their interests.","page_number":224,"box":{"x":70,"y":740,"width":460,"height":11}},{"id":"175386b8-c8fb-4eb8-8087-c2b7614207b2","block_type":"box","text":"In principle, we have concerns with the creation of a share class with equivalent economic exposure and","page_number":224,"box":{"x":102,"y":763,"width":743,"height":11}},{"id":"6f8c3ba8-fb6d-4236-bb92-1c4fcd9c6a91","block_type":"box","text":"differentiated voting rights. As a result, BIS generally suppor ts bylaw amendments that introduce the adoption of","page_number":224,"box":{"x":69,"y":778,"width":805,"height":11}},{"id":"77af189e-77e8-44ce-b77b-87794211e437","block_type":"box","text":"“one share, one vote” for registered shareholders.","page_number":224,"box":{"x":70,"y":793,"width":358,"height":11}},{"id":"24b0c7b7-49b1-4ae2-9170-01bdf48e1320","block_type":"box","text":"7","page_number":224,"box":{"x":69,"y":823,"width":4,"height":4}},{"id":"133aa4dc-ee8a-4f0d-9ae1-40321e79cf94","block_type":"box","text":"Enterprise Risk Management is a process, effected by the entity’s board of directors, management, and other","page_number":224,"box":{"x":79,"y":822,"width":784,"height":12}},{"id":"a92b11e5-c7a7-4fd9-b0ef-088c48704b7f","block_type":"box","text":"personnel, applied in strategy setting and across the enterprise, designed to identify potential events that may affect","page_number":224,"box":{"x":70,"y":837,"width":834,"height":12}},{"id":"8a8a529c-ee8a-46d2-a422-2b42cde87095","block_type":"box","text":"the entity, and manage risk to be within the risk appetite, to provide reasonable assurance regarding the achievement","page_number":224,"box":{"x":68,"y":853,"width":841,"height":11}},{"id":"3931a779-89bd-40a6-8d65-31c707327026","block_type":"box","text":"of objectives. Please see: The Committee of Sponsoring Organizations of the Treadway Commission (COSO),","page_number":224,"box":{"x":69,"y":868,"width":771,"height":11}},{"id":"c29135ad-1fef-4183-a9ea-fe4d6744190b","block_type":"box","text":"“Enterprise Risk Management,” 2023, accessed in December 2025.","page_number":224,"box":{"x":70,"y":883,"width":488,"height":11}},{"id":"aed623da-2b3c-4470-baaa-b5e80b1f9882","block_type":"box","text":"BlackRock Investment Stewardship","page_number":224,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"b93ba345-1ae3-4e1b-b1b6-41d0b9ac2fb1","block_type":"box","text":"Global Principles | 7","page_number":224,"box":{"x":768,"y":942,"width":140,"height":13}},{"id":"cd210c58-068c-421c-b9e0-fe637e19a5ab","block_type":"box","text":"NM1026U-6033063-224/246","page_number":224,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"6de4157e-e813-4142-9332-3f8a548a1456","block_type":"box","text":"However, we recognize that in cer tain markets, at least for a period of time, companies may have a valid reason","page_number":225,"box":{"x":102,"y":45,"width":798,"height":11}},{"id":"b19d1859-a35a-4b3f-846b-4b6c07cde20f","block_type":"box","text":"for listing dual classes of shares with differentiated voting rights. In our view, such companies should review these","page_number":225,"box":{"x":68,"y":60,"width":818,"height":11}},{"id":"ea863de4-504a-451e-9e7e-c9c80659f416","block_type":"box","text":"share class structures on a regular basis or as company circumstances change. Additionally, they should seek","page_number":225,"box":{"x":69,"y":75,"width":788,"height":11}},{"id":"10abbdc2-2d8e-43dc-9586-af2d9ae432b2","block_type":"box","text":"shareholder approval of their capital structure on a periodic basis via a management proposal at the company’s","page_number":225,"box":{"x":69,"y":90,"width":797,"height":11}},{"id":"0e9cbb2c-fd89-4f93-beb7-cc5614f439f5","block_type":"box","text":"shareholder meeting. The proposal should give unaffiliated shareholders the oppor tunity to affirm the current","page_number":225,"box":{"x":69,"y":105,"width":780,"height":11}},{"id":"5e3f2271-6a06-4d2d-97fd-7ea783933ea4","block_type":"box","text":"structure or establish mechanisms to end or phase out controlling structures at the appropriate time, while","page_number":225,"box":{"x":69,"y":120,"width":764,"height":12}},{"id":"0b9b1259-c4b2-4e19-8352-e93b3dc61ffa","block_type":"box","text":"minimizing costs to shareholders.","page_number":225,"box":{"x":69,"y":136,"width":238,"height":11}},{"id":"89384188-eefa-4fd6-bcfe-8126b8aa17cd","block_type":"box","text":"In assessing mergers, asset sales, or other special situations, BIS’ primary consideration is the long-term","page_number":225,"box":{"x":102,"y":158,"width":756,"height":11}},{"id":"f8b118fa-4eb0-4a89-ac45-9d81a334319f","block_type":"box","text":"financial interests of our clients as shareholders, and so we will review any proposed transaction with that objective","page_number":225,"box":{"x":68,"y":173,"width":826,"height":11}},{"id":"dbb53c01-83ab-4bae-a4eb-2a7af43ac1bc","block_type":"box","text":"in mind. Typically, we review factors such as whether the proposed transaction has the unanimous suppor t of the","page_number":225,"box":{"x":70,"y":188,"width":806,"height":11}},{"id":"d32c19f5-e546-4298-8372-d34e32e33255","block_type":"box","text":"board and has been negotiated at arm’s length, and whether the board or management has clearly explained its","page_number":225,"box":{"x":69,"y":204,"width":799,"height":11}},{"id":"68a36cb2-6d87-4384-84fa-0b277fc3141c","block_type":"box","text":"economic and strategic rationale. We may also seek reassurance from the board that the financial interests of","page_number":225,"box":{"x":69,"y":218,"width":788,"height":12}},{"id":"6994f226-4356-44fa-bad2-933b14ab2b38","block_type":"box","text":"executives and/or board members in a given transaction have not adversely affected their ability to place","page_number":225,"box":{"x":69,"y":234,"width":750,"height":11}},{"id":"7ae30999-203e-463c-8897-4e6bcffe7756","block_type":"box","text":"shareholders’ interests before their own. Where the transaction involves related par ties, the recommendation to","page_number":225,"box":{"x":69,"y":249,"width":801,"height":11}},{"id":"3b9b1790-89ea-496f-a063-eda127fbcd58","block_type":"box","text":"suppor t should come from the independent directors, a best practice in most markets, and ideally, the terms should","page_number":225,"box":{"x":69,"y":264,"width":830,"height":11}},{"id":"171ba1d2-c0f6-449a-a912-bba75dd21fe7","block_type":"box","text":"have been assessed through an independent appraisal process. In addition, it is good practice that it be approved by","page_number":225,"box":{"x":69,"y":279,"width":836,"height":11}},{"id":"1f0e4263-d538-40a3-b70f-3e21d328fe13","block_type":"box","text":"a separate vote of the non-conflicted par ties.","page_number":225,"box":{"x":69,"y":294,"width":320,"height":11}},{"id":"9e496a75-32ac-4d72-8dc8-cff57c5b6a75","block_type":"box","text":"As a matter of sound governance practice, shareholders should have a right to dispose of company shares in the","page_number":225,"box":{"x":101,"y":317,"width":806,"height":11}},{"id":"70721749-e27b-49fe-bdc9-dc65cae21324","block_type":"box","text":"open market without unnecessary restriction. In our view, corporate mechanisms designed to limit shareholders’","page_number":225,"box":{"x":69,"y":332,"width":801,"height":11}},{"id":"40eaff8c-7296-452c-8542-e3ea70baec2d","block_type":"box","text":"ability to sell their shares are contrary to basic proper ty rights. Such mechanisms can serve to protect and entrench","page_number":225,"box":{"x":69,"y":347,"width":829,"height":11}},{"id":"4bcb193f-5bb8-4104-bf25-f04226c234e8","block_type":"box","text":"interests other than those of the shareholders. In our view, shareholders are broadly capable of making decisions in","page_number":225,"box":{"x":70,"y":362,"width":826,"height":11}},{"id":"bdffb637-7833-4bc4-817f-51f6f1bb9a70","block_type":"box","text":"their own best interests. We encourage any shareholder rights plans proposed by a board to be subject to","page_number":225,"box":{"x":68,"y":377,"width":755,"height":12}},{"id":"d065f11c-1ad2-4357-b84c-e7299d208de6","block_type":"box","text":"shareholder approval upon introduction and periodically thereafter.","page_number":225,"box":{"x":69,"y":392,"width":472,"height":12}},{"id":"1dfdfeeb-e85e-4e7d-a1cc-9733addd4b8a","block_type":"box","text":"EXECUTIVE COMPENSATION AND BENEFITS","page_number":225,"box":{"x":328,"y":423,"width":322,"height":9}},{"id":"ff983c81-7ef6-46d2-ad9a-573c53cd7ba2","block_type":"box","text":"Executive compensation is an impor tant tool used by companies to suppor t long-term financial value creation. A","page_number":225,"box":{"x":102,"y":445,"width":799,"height":12}},{"id":"263ed5aa-1560-4c9b-94ac-9f9187f5b0da","block_type":"box","text":"well-structured compensation policy rewards the successful delivery of strategic, operational, and/or financial goals;","page_number":225,"box":{"x":68,"y":460,"width":830,"height":12}},{"id":"6aa83740-f8d9-4a92-aea3-756f4e200aad","block_type":"box","text":"encourages an appropriate risk appetite; and aligns the interests of shareholders and executives through equity","page_number":225,"box":{"x":69,"y":475,"width":797,"height":12}},{"id":"ed1b743d-e0b8-495d-8afb-74e90e001f50","block_type":"box","text":"ownership.","page_number":225,"box":{"x":69,"y":491,"width":75,"height":11}},{"id":"3c355540-891c-4bc3-a71c-0d2054c360e5","block_type":"box","text":"8","page_number":225,"box":{"x":146,"y":491,"width":4,"height":4}},{"id":"7ecc7312-3a4a-4f3b-89b8-36708ef48930","block_type":"box","text":"We look for a clear link between variable pay and operational and financial per formance that suppor t sustained","page_number":225,"box":{"x":101,"y":513,"width":793,"height":11}},{"id":"097649ed-f16f-4397-8af0-1abbf4648d0b","block_type":"box","text":"financial value creation for our clients as shareholders. We appreciate when per formance targets incorporate","page_number":225,"box":{"x":68,"y":528,"width":778,"height":12}},{"id":"2cf8ce34-16a2-44fd-b4fd-776f1f170aef","block_type":"box","text":"ambitious objectives, and the corresponding metrics are aligned with the company’s strategy and business model.","page_number":225,"box":{"x":69,"y":544,"width":815,"height":11}},{"id":"a49ce06d-ffe1-41d4-9de5-ae9cae627741","block_type":"box","text":"BIS does not have a position on whether companies choose to use sustainability-related criteria in compensation","page_number":225,"box":{"x":70,"y":559,"width":804,"height":11}},{"id":"8874a7ad-68ad-41d9-9642-606535676eb8","block_type":"box","text":"structures, but, where they are included, we look to companies to be as rigorous as they would be in setting other","page_number":225,"box":{"x":69,"y":574,"width":814,"height":11}},{"id":"40d63df1-ddee-4946-bb04-43eae19e756f","block_type":"box","text":"financial or operational targets. We appreciate when long-term incentive plans encompass timeframes that: 1) are","page_number":225,"box":{"x":68,"y":589,"width":813,"height":11}},{"id":"8c2571e0-f3dd-4782-accb-3a57b2e6e64a","block_type":"box","text":"distinct from annual executive compensation structures and metrics, and 2) encourage the delivery of strong financial","page_number":225,"box":{"x":69,"y":604,"width":839,"height":11}},{"id":"8748974a-e7ed-42c3-a870-3abe916f6341","block_type":"box","text":"results over a period of years.","page_number":225,"box":{"x":69,"y":619,"width":211,"height":11}},{"id":"8c0cabe5-f7aa-4474-8069-52be1e844fdf","block_type":"box","text":"We consider it best practice when board members responsible for designing and approving executive","page_number":225,"box":{"x":101,"y":642,"width":718,"height":11}},{"id":"cad7e58e-33d4-415e-bb2c-46a8ed8ca718","block_type":"box","text":"compensation carefully consider the company’s specific circumstances. Factors to consider may include the","page_number":225,"box":{"x":69,"y":657,"width":770,"height":11}},{"id":"1044d0c3-d8b7-4471-9176-c45c2b741ee4","block_type":"box","text":"company’s risk profile, the environment it operates in, and the individuals the board is trying to attract and retain. We","page_number":225,"box":{"x":69,"y":672,"width":838,"height":11}},{"id":"781a060b-9ab9-4a83-8156-0f5cc4fefc4a","block_type":"box","text":"look to the compensation committees to guard against contractual arrangements that would entitle executives to","page_number":225,"box":{"x":70,"y":687,"width":804,"height":11}},{"id":"4641787c-8b83-476f-ac2c-57303ca28d59","block_type":"box","text":"material compensation for early termination of their employment. Finally, we look for pension contributions and other","page_number":225,"box":{"x":69,"y":702,"width":831,"height":11}},{"id":"4a783ec4-f65b-46c9-8a42-517e0b9a3f95","block_type":"box","text":"deferred compensation arrangements to be reasonable in light of market practices or the company’s business and","page_number":225,"box":{"x":69,"y":717,"width":817,"height":12}},{"id":"8f8f4594-cbbe-4c9a-baaf-bea2a3bee99c","block_type":"box","text":"executive compensation strategies.","page_number":225,"box":{"x":69,"y":733,"width":250,"height":11}},{"id":"37140694-d49f-4beb-80f7-e3b5851cbeef","block_type":"box","text":"We are not suppor tive of one-off or special bonuses unrelated to company or individual per formance. Where","page_number":225,"box":{"x":101,"y":755,"width":772,"height":11}},{"id":"d4302e17-a1d7-47e2-ba59-d3ac489e787f","block_type":"box","text":"discretion has been used by the compensation committee, or its equivalent, we appreciate disclosure relating to how","page_number":225,"box":{"x":69,"y":771,"width":836,"height":11}},{"id":"b6926f3a-df69-4676-a971-80559192fdd2","block_type":"box","text":"and why the discretion was used, and how the adjusted outcome is aligned with the interests of shareholders. In","page_number":225,"box":{"x":69,"y":785,"width":803,"height":12}},{"id":"c2c1026c-0871-4aaf-863f-9d06568e8cf0","block_type":"box","text":"addition, we acknowledge that the use of peer group evaluation by compensation committees can help ensure","page_number":225,"box":{"x":69,"y":801,"width":785,"height":11}},{"id":"091862b5-d5ea-4991-83d4-33c1b000e150","block_type":"box","text":"competitive pay. However, we encourage companies to clearly explain how compensation outcomes have rewarded","page_number":225,"box":{"x":69,"y":816,"width":815,"height":11}},{"id":"1b3ee7e7-69a5-44c9-8821-f0171dc3734c","block_type":"box","text":"per formance rather than solely base increases in total compensation on peer benchmarking.","page_number":225,"box":{"x":70,"y":831,"width":659,"height":11}},{"id":"52f6e224-e5de-4522-b467-0a897332323d","block_type":"box","text":"8","page_number":225,"box":{"x":69,"y":860,"width":4,"height":5}},{"id":"f4194b6a-4f95-45ea-a501-3dd82921d1d8","block_type":"box","text":"The terms “compensation,” “remuneration,” and “pay” are used interchangeably to describe the same concept in","page_number":225,"box":{"x":78,"y":860,"width":811,"height":11}},{"id":"262b888a-4881-4c4a-8978-2d122c23c967","block_type":"box","text":"different markets.","page_number":225,"box":{"x":69,"y":875,"width":126,"height":9}},{"id":"1634c180-b4a9-445d-9c36-cc0f8b160fd2","block_type":"box","text":"BlackRock Investment Stewardship","page_number":225,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"4ca6889e-dfdf-4317-ac6f-2bed8b521b2e","block_type":"box","text":"Global Principles | 8","page_number":225,"box":{"x":768,"y":942,"width":141,"height":13}},{"id":"e92adec1-2e7e-44cf-837b-4ab8237be854","block_type":"box","text":"NM1026U-6033063-225/246","page_number":225,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"46d9e1a6-c7de-42a5-9198-ccf3b273e99f","block_type":"box","text":"We consider the inclusion of building clawback provisions into incentive plans as good practice. Such provisions","page_number":226,"box":{"x":101,"y":45,"width":797,"height":11}},{"id":"159abff3-d60e-46b7-9c64-b08e29ac9baa","block_type":"box","text":"could require executives to forgo awards when compensation was based on faulty financial statements or deceptive","page_number":226,"box":{"x":69,"y":60,"width":825,"height":11}},{"id":"ad9e80e4-96b1-4e8b-9bd7-2ed894d75639","block_type":"box","text":"business practices, or when their behavior caused material financial harm to shareholders, material reputational risk","page_number":226,"box":{"x":69,"y":75,"width":833,"height":11}},{"id":"c1dc054b-6978-4791-bccb-52c5ceaf2064","block_type":"box","text":"to the company, or resulted in a criminal investigation.","page_number":226,"box":{"x":68,"y":90,"width":386,"height":11}},{"id":"b1f72a3e-146c-46f4-af41-075168efc146","block_type":"box","text":"In our view, non-executive directors should be compensated in a manner that is commensurate with the time and","page_number":226,"box":{"x":102,"y":113,"width":803,"height":11}},{"id":"8912ea12-5557-4a0a-843f-988ca0bb5f27","block_type":"box","text":"effor t expended in fulfilling their professional responsibilities. Additionally, these compensation arrangements should","page_number":226,"box":{"x":69,"y":128,"width":834,"height":11}},{"id":"6718badb-ef2b-457f-8222-0744f83d5286","block_type":"box","text":"not risk compromising directors’ independence or aligning their interests too closely with those of the management,","page_number":226,"box":{"x":69,"y":143,"width":825,"height":11}},{"id":"1fcc6e46-47a7-41cc-996c-42518628adcb","block_type":"box","text":"whom they are charged with overseeing.","page_number":226,"box":{"x":68,"y":158,"width":285,"height":11}},{"id":"bdd2f36a-0b03-491c-a355-2ef8c575be16","block_type":"box","text":"When assessing compensation proposals, BIS reviews companies’ disclosures to determine whether the board’s","page_number":226,"box":{"x":101,"y":181,"width":807,"height":11}},{"id":"0aae3957-30ca-46e3-a877-effa25003f14","block_type":"box","text":"approach to executive compensation is rigorous in light of the company’s stated long-term corporate strategy and","page_number":226,"box":{"x":69,"y":196,"width":807,"height":11}},{"id":"37e52519-86dd-4169-baf5-f78a4482a2c2","block_type":"box","text":"specific circumstances, as well as local market and policy developments.","page_number":226,"box":{"x":69,"y":211,"width":521,"height":11}},{"id":"6286aa3b-8e16-4306-90ce-f22e40bf1ff4","block_type":"box","text":"When our analysis indicates that executive compensation is misaligned with company per formance, BIS may not","page_number":226,"box":{"x":101,"y":234,"width":802,"height":11}},{"id":"88a505e6-220b-4c23-b82b-3e630aa8f800","block_type":"box","text":"suppor t management’s proposals to approve compensation, where they are on the agenda. We may also not suppor t","page_number":226,"box":{"x":69,"y":249,"width":838,"height":11}},{"id":"5b22a80b-23ef-44a9-a8bb-e0ca63b94895","block_type":"box","text":"members of the compensation committee or equivalent board members for poor compensation practices or","page_number":226,"box":{"x":69,"y":264,"width":766,"height":11}},{"id":"315251fb-e0c3-4f59-a463-6ae196857b9f","block_type":"box","text":"structures.","page_number":226,"box":{"x":69,"y":280,"width":76,"height":8}},{"id":"948f589e-c5f5-416c-813b-7db7fe3bce70","block_type":"box","text":"SHAREHOLDER PROTECTIONS AND OTHER CORPORATE GOVERNANCE MATTERS","page_number":226,"box":{"x":191,"y":309,"width":595,"height":9}},{"id":"c9d0ca86-b43e-4cf5-aae5-19ba2a051f0b","block_type":"box","text":"Corporate form","page_number":226,"box":{"x":69,"y":339,"width":108,"height":11}},{"id":"f86c4f0c-46b9-4f13-9728-a782c8c5e680","block_type":"box","text":"In our view, it is the responsibility of the board to determine the corporate form that is most appropriate given","page_number":226,"box":{"x":102,"y":362,"width":781,"height":11}},{"id":"60543ed4-a649-4785-a703-6cf924d27864","block_type":"box","text":"the company’s purpose and business model.","page_number":226,"box":{"x":68,"y":377,"width":320,"height":11}},{"id":"683833db-4f96-46f7-bcba-bd134bb31d59","block_type":"box","text":"9","page_number":226,"box":{"x":390,"y":378,"width":4,"height":4}},{"id":"35fc8e8e-2757-41ec-9d0e-a89d28368ee2","block_type":"box","text":"We look to companies proposing to change their corporate form to a","page_number":226,"box":{"x":399,"y":377,"width":487,"height":12}},{"id":"775bcf72-b7c1-46a9-b43c-74fcc3a900de","block_type":"box","text":"public benefit corporation, or similar entity, to put it to a shareholder vote if not already required to do so under","page_number":226,"box":{"x":70,"y":392,"width":791,"height":12}},{"id":"6eb2219a-be0b-467c-a5f0-c5d0fd6b6cf4","block_type":"box","text":"applicable law. We appreciate when suppor ting documentation from companies or shareholders proposing to alter the","page_number":226,"box":{"x":69,"y":407,"width":839,"height":12}},{"id":"106b4a15-6a80-4258-ad46-003ec05212af","block_type":"box","text":"corporate form clearly explains how the interests of shareholders and different stakeholders would be impacted as","page_number":226,"box":{"x":69,"y":423,"width":818,"height":11}},{"id":"44a4ff23-6c5b-4c7f-8341-6bc7d375e55f","block_type":"box","text":"well as the accountability and voting mechanisms that would be available to shareholders. We generally suppor t","page_number":226,"box":{"x":68,"y":438,"width":800,"height":11}},{"id":"59e4b47d-7217-455c-9a72-1d6854f2dd3f","block_type":"box","text":"management proposals if our analysis indicates that shareholders’ financial interests are adequately protected.","page_number":226,"box":{"x":69,"y":453,"width":796,"height":11}},{"id":"4547b8b6-af42-4e5f-b4ed-e2fcafa49a1c","block_type":"box","text":"Corporate form shareholder proposals are evaluated on a case-by-case basis.","page_number":226,"box":{"x":69,"y":468,"width":552,"height":11}},{"id":"1071308a-3b46-498d-beb0-ae5459bf487e","block_type":"box","text":"SHAREHOLDER PROPOSALS","page_number":226,"box":{"x":385,"y":498,"width":207,"height":9}},{"id":"f9cefb1e-f4fe-4334-8568-ae77d59e2848","block_type":"box","text":"In most markets, shareholders can submit proposals to be voted on at a company’s shareholder meeting, as","page_number":226,"box":{"x":102,"y":521,"width":777,"height":11}},{"id":"00acd7c9-ce85-4c8c-b375-acb5ea698fb6","block_type":"box","text":"long as cer tain requirements are met. Shareholder proposals span a wide range of topics, including governance","page_number":226,"box":{"x":70,"y":536,"width":796,"height":11}},{"id":"77feb508-ddde-4ff8-a179-747568f64a21","block_type":"box","text":"reforms, capital management, and changes in the management or disclosure of sustainability-related risks. These","page_number":226,"box":{"x":69,"y":551,"width":813,"height":11}},{"id":"7ab83d19-9a35-4af7-b6d0-0caddbd9cd1e","block_type":"box","text":"proposals have a varying degree of relevance for companies across sectors, locations, and business models.","page_number":226,"box":{"x":70,"y":566,"width":779,"height":11}},{"id":"7a981efe-9e78-494b-9ad9-f0e291f13e32","block_type":"box","text":"BIS takes a case-by-case approach to voting on shareholder proposals and maintains a singular focus on the","page_number":226,"box":{"x":102,"y":589,"width":775,"height":11}},{"id":"4dd5614c-0171-43a6-a353-267387a073dd","block_type":"box","text":"proposal’s implications for long-term financial value creation for shareholders. Our analysis considers whether a","page_number":226,"box":{"x":70,"y":604,"width":796,"height":11}},{"id":"e5b22104-0853-4174-823a-d5c8ddf53d46","block_type":"box","text":"shareholder proposal addresses a material risk that may impact a company’s long-term financial per formance. BIS","page_number":226,"box":{"x":69,"y":619,"width":818,"height":11}},{"id":"ccefc502-b960-43a0-9a69-5f4d96c35234","block_type":"box","text":"may suppor t shareholder proposals that request disclosures that help us, as long-term investors on behalf of our","page_number":226,"box":{"x":69,"y":634,"width":809,"height":12}},{"id":"6f97f3a3-d3d5-4bc1-b832-686954e420b4","block_type":"box","text":"clients, better understand the material risks and oppor tunities companies face and how they are managing them,","page_number":226,"box":{"x":69,"y":649,"width":807,"height":12}},{"id":"a6101295-6148-44ef-a11c-173e5c8c2d73","block_type":"box","text":"especially where this information is additive given the company’s existing disclosures. We look for consistency","page_number":226,"box":{"x":69,"y":664,"width":787,"height":12}},{"id":"77f8a19d-9f38-47f6-8cef-6a5e9deb8f70","block_type":"box","text":"between the specific request formally made in the proposal, the suppor ting documentation, and the proponents’","page_number":226,"box":{"x":69,"y":680,"width":801,"height":11}},{"id":"76dc1a2b-8485-43d0-bc5b-239d35b90373","block_type":"box","text":"other communications on the issues. We also assess the company’s practices and disclosures and the costs and","page_number":226,"box":{"x":69,"y":695,"width":813,"height":11}},{"id":"4fe07351-8288-4cd5-8666-d238e0be2972","block_type":"box","text":"benefits to the company of meeting the request made in the proposal. We take into consideration a company’s","page_number":226,"box":{"x":69,"y":710,"width":791,"height":11}},{"id":"779b4110-9fdf-4d3d-8b9f-dcfc594ccce1","block_type":"box","text":"governance practices and disclosures against those of their peers.","page_number":226,"box":{"x":68,"y":725,"width":475,"height":11}},{"id":"fea277aa-2af9-46cd-8c2d-7edf5af123cd","block_type":"box","text":"BIS does not suppor t shareholder proposals that we view as inconsistent with long-term financial value or that","page_number":226,"box":{"x":102,"y":748,"width":787,"height":11}},{"id":"7d61901a-8101-45d2-bb0a-ba1b1350f981","block_type":"box","text":"seek to micromanage companies. We take into consideration the legal effect of the proposal, as shareholder","page_number":226,"box":{"x":69,"y":763,"width":778,"height":11}},{"id":"390fee34-0b41-4511-a537-3ea900316dbf","block_type":"box","text":"proposals may be advisory or legally binding depending on the jurisdiction, while others may make requests that","page_number":226,"box":{"x":70,"y":778,"width":799,"height":11}},{"id":"c085b962-1014-4f9a-b66c-9bb2c0841a60","block_type":"box","text":"would be deemed illegal in a given jurisdiction.","page_number":226,"box":{"x":68,"y":793,"width":331,"height":11}},{"id":"af51beee-4597-4bf7-849c-5f71f6f9facd","block_type":"box","text":"In our experience, it is helpful when companies disclose the names of the proponent or organization that has","page_number":226,"box":{"x":102,"y":816,"width":777,"height":11}},{"id":"b3c008bb-f0d8-4099-8a13-d68a392b4b31","block_type":"box","text":"submitted or advised on the proposal. We recognize that some shareholder proposals bundle topics and/or specific","page_number":226,"box":{"x":69,"y":831,"width":825,"height":11}},{"id":"1fe08443-511f-419c-90ab-42e946ea78da","block_type":"box","text":"requests. Fur ther, the proponent’s suppor ting statement may refer to topics that are not directly related to the","page_number":226,"box":{"x":69,"y":846,"width":788,"height":11}},{"id":"804a22fe-0c78-4d9c-9f52-ffeeb22a4507","block_type":"box","text":"request made in the proposal. In voting on behalf of clients, we must vote yes or no on the proposal as phrased by","page_number":226,"box":{"x":69,"y":861,"width":820,"height":11}},{"id":"e4dc0ae2-63c1-44c6-a274-8915beb09b10","block_type":"box","text":"the proponent. Therefore, when we vote in suppor t of a proposal, we are not necessarily endorsing every element of","page_number":226,"box":{"x":68,"y":876,"width":831,"height":11}},{"id":"7dc3b7d2-132c-41ab-965b-f4cbaddb960a","block_type":"box","text":"9","page_number":226,"box":{"x":69,"y":906,"width":4,"height":4}},{"id":"17d1489f-d587-4c7b-b06e-a39071e64a55","block_type":"box","text":"Corporate form refers to the legal structure by which a business is organized.","page_number":226,"box":{"x":79,"y":905,"width":550,"height":12}},{"id":"9ec653df-23fb-45b2-9e2d-19ef543a681f","block_type":"box","text":"BlackRock Investment Stewardship","page_number":226,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"fdb5f17d-9cef-4dd5-8370-74a48592440c","block_type":"box","text":"Global Principles | 9","page_number":226,"box":{"x":768,"y":942,"width":141,"height":13}},{"id":"8f0e477a-ae63-44aa-9a55-6e4980e2ba44","block_type":"box","text":"NM1026U-6033063-226/246","page_number":226,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"427dde99-8329-43c4-abf1-627f4f516c2b","block_type":"box","text":"the proposal or the reasoning, objectives, or suppor ting statement of the proponent. We may suppor t a proposal for","page_number":227,"box":{"x":68,"y":45,"width":829,"height":11}},{"id":"ba27442b-29b7-4d8f-913d-77a44767756d","block_type":"box","text":"different reasons than those put for th by the proponent, when we believe that overall it may advance our clients’","page_number":227,"box":{"x":69,"y":60,"width":802,"height":11}},{"id":"3daa0d8b-faca-4bbc-b444-3cb5bd43d311","block_type":"box","text":"long-term financial interests.","page_number":227,"box":{"x":70,"y":75,"width":201,"height":11}},{"id":"73c01270-ba44-4662-ad67-3184ea7988cd","block_type":"box","text":"BlackRock is subject to cer tain rules, regulations, agency guidance, and contractual agreements that place","page_number":227,"box":{"x":102,"y":98,"width":763,"height":11}},{"id":"3e33f935-6a03-4d28-a8b9-99b6de123f21","block_type":"box","text":"restrictions and limitations on how BlackRock can interact with the companies in which we invest on behalf of our","page_number":227,"box":{"x":69,"y":113,"width":809,"height":11}},{"id":"7324534a-b154-4222-a719-6d8bb5f86ec6","block_type":"box","text":"clients. BlackRock does not nominate directors for board elections or submit shareholder proposals to companies.","page_number":227,"box":{"x":69,"y":128,"width":817,"height":11}},{"id":"e7c7915e-996d-4c98-bdde-43bec7094659","block_type":"box","text":"Non-compliance with these requirements could adversely affect BlackRock’s ability to serve its clients’ interests.","page_number":227,"box":{"x":70,"y":143,"width":803,"height":11}},{"id":"1e119353-846f-4ffe-8dab-66c8aea22c53","block_type":"box","text":"MATERIAL SUSTAINABILITY-RELATED RISKS AND OPPORTUNITIES","page_number":227,"box":{"x":247,"y":173,"width":484,"height":9}},{"id":"2522aa8d-c770-48d9-9c58-3495865b8cb9","block_type":"box","text":"Appropriate oversight of material risks and oppor tunities, including material sustainability-related risks and","page_number":227,"box":{"x":101,"y":196,"width":760,"height":11}},{"id":"d7135369-6b30-47c8-8804-3790d4ca3e55","block_type":"box","text":"oppor tunities, is an impor tant component of having an effective governance framework that suppor ts durable, long","page_number":227,"box":{"x":69,"y":211,"width":824,"height":11}},{"id":"6f2260cf-e14b-49f1-bacc-588840893097","block_type":"box","text":"term financial value creation.","page_number":227,"box":{"x":68,"y":226,"width":206,"height":9}},{"id":"5aaa7c83-880b-4450-b6a6-82939a2c6652","block_type":"box","text":"10","page_number":227,"box":{"x":276,"y":226,"width":9,"height":5}},{"id":"8f386d27-6824-4a56-9421-371441560c47","block_type":"box","text":"We look to companies to provide robust disclosure that allows investors to effectively evaluate companies’","page_number":227,"box":{"x":101,"y":249,"width":761,"height":11}},{"id":"e04940d0-d6f3-4999-993a-0c80d44ae381","block_type":"box","text":"strategy and business practices related to material sustainability-related risks and oppor tunities. We find it helpful","page_number":227,"box":{"x":69,"y":264,"width":814,"height":11}},{"id":"ab033bb9-4086-4673-b072-4bc1ef9a73f2","block_type":"box","text":"when companies’ disclosures demonstrate that they have a resilient business model that integrates material","page_number":227,"box":{"x":68,"y":279,"width":777,"height":11}},{"id":"745bf8f1-0dfb-4477-b803-3b78ddf649a8","block_type":"box","text":"sustainability-related risks and oppor tunities into their strategy, risk management, and metrics and targets, including","page_number":227,"box":{"x":69,"y":294,"width":833,"height":11}},{"id":"e60c001b-2d6f-4ba8-93de-0e3aecd781ce","block_type":"box","text":"industry-specific metrics.","page_number":227,"box":{"x":70,"y":309,"width":175,"height":11}},{"id":"43266c0b-96b6-46e2-a28a-78f5623e6be0","block_type":"box","text":"Standardized disclosure of sustainability-related data suppor ts investors in making informed decisions. The","page_number":227,"box":{"x":102,"y":332,"width":765,"height":11}},{"id":"8b6776f5-ebff-4e83-9666-424d4078b2a1","block_type":"box","text":"International Sustainability Standards Board (ISSB) standards, IFRS S1 and S2, represent one such approach to","page_number":227,"box":{"x":70,"y":347,"width":800,"height":11}},{"id":"f1860521-4fc2-4c14-980c-06de5af0bb1e","block_type":"box","text":"standardization that we find useful in our analysis.","page_number":227,"box":{"x":69,"y":362,"width":358,"height":11}},{"id":"76ed38b0-f158-49e2-8b95-6b808e38381a","block_type":"box","text":"11","page_number":227,"box":{"x":429,"y":363,"width":9,"height":4}},{"id":"3c1bae8d-25e3-4239-a95a-48ba1a29ad13","block_type":"box","text":"However, we do not mandate any specific disclosure framework","page_number":227,"box":{"x":444,"y":362,"width":451,"height":11}},{"id":"a5e88a20-c29c-42c9-b464-36c0cd145490","block_type":"box","text":"companies should use, and recognize that companies may repor t using different standards, some of which may be","page_number":227,"box":{"x":69,"y":377,"width":821,"height":12}},{"id":"bd56d6cc-6e7d-4e11-b73d-25ce8e91575e","block_type":"box","text":"required by regulation. In such cases, we ask that companies highlight the metrics that are industry- or company","page_number":227,"box":{"x":69,"y":393,"width":806,"height":11}},{"id":"317ad9e3-7fbb-468c-bc09-82b551649033","block_type":"box","text":"specific.","page_number":227,"box":{"x":69,"y":407,"width":57,"height":11}},{"id":"bc79d5f6-f63f-4516-a951-8c4b01f5923f","block_type":"box","text":"We also recognize that companies may be phasing in repor ting over several years. We do not prescribe timelines","page_number":227,"box":{"x":101,"y":430,"width":805,"height":11}},{"id":"8dec22d9-b510-4ff1-b4b9-aa30ef2f064f","block_type":"box","text":"regarding when companies should make sustainability-related disclosures but appreciate it when companies produce","page_number":227,"box":{"x":69,"y":446,"width":833,"height":11}},{"id":"2bdd5298-82e1-4c26-9f49-29ac3963d620","block_type":"box","text":"them sufficiently in advance of their shareholder meeting, to the best of their abilities, to provide investors with time","page_number":227,"box":{"x":68,"y":460,"width":830,"height":12}},{"id":"e9253b41-3d77-419d-9f4e-171fe32160aa","block_type":"box","text":"to assess the data and make informed voting decisions.","page_number":227,"box":{"x":68,"y":475,"width":401,"height":12}},{"id":"99d632dd-943b-4003-af4e-33ae13f305be","block_type":"box","text":"Industry initiatives on managing specific operational risks may also provide useful guidance to companies on","page_number":227,"box":{"x":102,"y":498,"width":775,"height":11}},{"id":"fba75d69-bb47-4161-a9ac-9bac7e7f292f","block_type":"box","text":"best practices and disclosures. While not a voting item, we find it helpful to our understanding of investment risk","page_number":227,"box":{"x":69,"y":513,"width":804,"height":12}},{"id":"88ac4b5c-9e17-4adb-b2b7-5a3cb2093a4d","block_type":"box","text":"when companies disclose any relevant global sustainability-related standards adopted, the industry initiatives in","page_number":227,"box":{"x":68,"y":529,"width":799,"height":11}},{"id":"1b0d6be5-57f5-417c-b23b-b3758d2c6dbe","block_type":"box","text":"which they par ticipate, any peer group benchmarking under taken, and any assurance processes to help investors","page_number":227,"box":{"x":68,"y":544,"width":810,"height":11}},{"id":"163f088f-1d17-45be-83d5-d42dcd03088f","block_type":"box","text":"understand their approach to sustainable and responsible business practices.","page_number":227,"box":{"x":69,"y":559,"width":556,"height":11}},{"id":"028cd8ed-4a9e-4e39-be74-8eed460a9420","block_type":"box","text":"10","page_number":227,"box":{"x":69,"y":603,"width":9,"height":5}},{"id":"05b5b2a6-9ca3-401a-ab00-81cbae12db15","block_type":"box","text":"By material sustainability-related risks and oppor tunities, we mean the drivers of risk and financial value creation in","page_number":227,"box":{"x":84,"y":603,"width":822,"height":11}},{"id":"6cbd609a-2497-4679-84d0-317f04a2bf34","block_type":"box","text":"a company’s business model that have an environmental or social dependency or impact. Examples of environmental","page_number":227,"box":{"x":69,"y":618,"width":835,"height":11}},{"id":"f1969453-92b3-4b99-a225-5b6cd543717d","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":227,"box":{"x":70,"y":633,"width":827,"height":12}},{"id":"fcc3f5b1-3c37-489c-ab3d-0e5d2d7ce651","block_type":"box","text":"issues include, but are not limited to, human capital management, impacts on the communities in which a company","page_number":227,"box":{"x":70,"y":649,"width":826,"height":11}},{"id":"56cdecda-be31-4bde-8afd-e1fbfa98ca3b","block_type":"box","text":"operates, customer loyalty, and relationships with regulators.","page_number":227,"box":{"x":69,"y":664,"width":433,"height":11}},{"id":"5905b304-c2ad-483a-bbc1-1ca9b2a7c19f","block_type":"box","text":"11","page_number":227,"box":{"x":69,"y":682,"width":9,"height":4}},{"id":"fa9f30ac-94c1-4fcf-a253-4529793e3f98","block_type":"box","text":"The ISSB is an independent standard-setting body within the International Financial Repor ting Standards","page_number":227,"box":{"x":83,"y":681,"width":744,"height":11}},{"id":"13e1a969-ad30-4ce2-9781-258f0ca75b8c","block_type":"box","text":"(IFRS) Foundation. The standards build on the Task Force on Climate-related Financial Disclosures (TCFD) framework","page_number":227,"box":{"x":69,"y":696,"width":828,"height":11}},{"id":"d8e70103-a095-417c-a02c-b81fd7dfc699","block_type":"box","text":"and the standards and metrics developed by the Sustainability Accounting Standards Board (SASB), which have both","page_number":227,"box":{"x":69,"y":711,"width":830,"height":12}},{"id":"05372826-3d59-4b76-a3b8-b3de37e68892","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":227,"box":{"x":69,"y":726,"width":809,"height":12}},{"id":"9ea3c041-7238-4000-bb75-c6f7aae8c813","block_type":"box","text":"“General Requirements for Disclosure of Sustainability-related Financial Information” and S2 “Climate-related","page_number":227,"box":{"x":70,"y":742,"width":778,"height":11}},{"id":"6bf8e4c2-d657-48e6-8117-0ea53edddfa0","block_type":"box","text":"Disclosures.” Websites accessed in December 2025.","page_number":227,"box":{"x":70,"y":757,"width":380,"height":9}},{"id":"02380067-1399-4005-a20a-20c58d41e460","block_type":"box","text":"BlackRock Investment Stewardship","page_number":227,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"844ce90a-13a5-4670-8501-cf84c041197d","block_type":"box","text":"Global Principles | 10","page_number":227,"box":{"x":758,"y":942,"width":151,"height":13}},{"id":"b291bf09-71ec-4cfa-8f40-ebc665721ddf","block_type":"box","text":"NM1026U-6033063-227/246","page_number":227,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"ecbec744-0431-4ad4-aa78-a62fbffc8c96","block_type":"box","text":"CLIMATE AND NATURE-RELATED RISK","page_number":228,"box":{"x":351,"y":45,"width":277,"height":9}},{"id":"95d7283d-8e2b-4275-9b08-5d081f23e301","block_type":"box","text":"Many companies are assessing how to navigate the low-carbon transition while delivering long-term financial","page_number":228,"box":{"x":102,"y":67,"width":769,"height":12}},{"id":"cdba5710-e1d5-4e09-ae3b-32da03065bce","block_type":"box","text":"value to investors. For companies facing material climate-related risks, we find it helpful when they publicly disclose,","page_number":228,"box":{"x":68,"y":82,"width":829,"height":12}},{"id":"779b3d2a-93d8-405f-85b2-9779d4046956","block_type":"box","text":"consistent with their business model and sector, how they intend to deliver long-term financial per formance through","page_number":228,"box":{"x":69,"y":98,"width":824,"height":11}},{"id":"48aa30cd-c600-45e8-a3b0-3c96ba3dd97b","block_type":"box","text":"the low-carbon transition, including where available, their transition plan.","page_number":228,"box":{"x":68,"y":113,"width":514,"height":11}},{"id":"1e9ec997-559c-4b08-8443-8d4b23b84b7a","block_type":"box","text":"12, 13","page_number":228,"box":{"x":584,"y":113,"width":26,"height":5}},{"id":"239d9653-c5c5-4a06-b63a-901b4cf272b1","block_type":"box","text":"From company disclosures and","page_number":228,"box":{"x":617,"y":113,"width":218,"height":11}},{"id":"5c6a2f55-9663-4534-b28a-a4e706cde411","block_type":"box","text":"engagement, we seek to understand the strategies companies have in place to manage material risks to, and","page_number":228,"box":{"x":69,"y":128,"width":782,"height":11}},{"id":"2ee06a65-b5f6-4926-aba8-0ebb97f4dd46","block_type":"box","text":"oppor tunities for, their long-term business model associated with a range of climate-related scenarios.","page_number":228,"box":{"x":69,"y":143,"width":729,"height":11}},{"id":"6df9bad0-8c07-40c2-9f71-049e54a21117","block_type":"box","text":"Recognizing the value of these disclosures, cer tain markets such as the European Union mandate large","page_number":228,"box":{"x":102,"y":166,"width":740,"height":11}},{"id":"a10bdf7d-338a-4f53-98c2-6579e5d54df9","block_type":"box","text":"companies to disclose such climate-related financial information, while in other jurisdictions these disclosures are","page_number":228,"box":{"x":69,"y":181,"width":814,"height":11}},{"id":"d9d3f660-23e8-4240-a46b-5734ec8f6fe4","block_type":"box","text":"viewed as best practice in the market.","page_number":228,"box":{"x":68,"y":196,"width":271,"height":11}},{"id":"a10457fd-8665-4ece-85a9-4a4e86572b4e","block_type":"box","text":"The ISSB standards provide one such framework that can assist investors in assessing company-specific","page_number":228,"box":{"x":101,"y":218,"width":749,"height":12}},{"id":"5d8da6b8-614c-4c29-88a7-d7e13a37c4fb","block_type":"box","text":"climate-related risks and oppor tunities, and informing investment decisions. Such disclosures also provide investors","page_number":228,"box":{"x":69,"y":234,"width":831,"height":11}},{"id":"b074f813-a568-42bd-9c50-82b3afc27034","block_type":"box","text":"with insights into how companies are managing the risks associated with a transition to a low-carbon economy by","page_number":228,"box":{"x":68,"y":249,"width":809,"height":11}},{"id":"a6db0ba6-403a-4901-89f5-48cacd5b07c4","block_type":"box","text":"managing their own carbon emissions or emissions intensities to the extent financially practicable.","page_number":228,"box":{"x":69,"y":264,"width":702,"height":11}},{"id":"24a69248-92fe-494c-aad4-69e98e310f5e","block_type":"box","text":"The ISSB standards, for example, contemplate disclosures on how companies are setting shor t-, medium- and","page_number":228,"box":{"x":101,"y":286,"width":786,"height":12}},{"id":"9cb8217f-eab1-4e21-a14c-c306be2c174c","block_type":"box","text":"long-term targets, ideally science-based where these are available for their sector, for scope 1 and 2 greenhouse gas","page_number":228,"box":{"x":70,"y":302,"width":834,"height":11}},{"id":"7770eaa5-8982-4ac2-90b8-edb636a1ebda","block_type":"box","text":"emissions (GHG) reductions and to demonstrate how their targets are consistent with the long-term financial","page_number":228,"box":{"x":69,"y":317,"width":773,"height":11}},{"id":"0d088600-d887-41ce-8000-f706486ef26e","block_type":"box","text":"interests of their investors.","page_number":228,"box":{"x":70,"y":332,"width":190,"height":9}},{"id":"458ebf28-6a56-4894-911a-40dbd90cf0c6","block_type":"box","text":"While we recognize that regulators in some markets are moving to mandate cer tain disclosures, at this stage,","page_number":228,"box":{"x":101,"y":355,"width":784,"height":11}},{"id":"3e98d5de-c8ef-40c3-8b13-dbd310bfd847","block_type":"box","text":"we view scope 3 emissions differently from scopes 1 and 2, given methodological complexity, regulatory uncer tainty,","page_number":228,"box":{"x":68,"y":370,"width":832,"height":11}},{"id":"be96268b-98dd-40a3-9fc5-6ab1691026a7","block_type":"box","text":"concerns about double-counting, and lack of direct control by companies. We welcome disclosures and commitments","page_number":228,"box":{"x":69,"y":385,"width":834,"height":11}},{"id":"18d2cf77-b5b7-4d5c-9585-b68d004355b5","block_type":"box","text":"that companies choose to make regarding material scope 3 emissions and recognize that these are provided on a","page_number":228,"box":{"x":68,"y":400,"width":815,"height":11}},{"id":"33b5cec2-4d50-48ac-8811-e5cbbd8dc4e7","block_type":"box","text":"good-faith basis as methodology develops.","page_number":228,"box":{"x":68,"y":415,"width":303,"height":11}},{"id":"c23359a9-61ff-41ce-ace1-e3b5f836f555","block_type":"box","text":"In addition to climate-related risks and oppor tunities, for companies whose strategies, operations or supply","page_number":228,"box":{"x":102,"y":438,"width":766,"height":11}},{"id":"f4ee2bee-4980-4458-b813-a7342f5e793c","block_type":"box","text":"chains are materially reliant on natural capital, nature-related risks and oppor tunities may affect their ability to","page_number":228,"box":{"x":69,"y":453,"width":788,"height":11}},{"id":"dfc45bdf-2e96-48c2-868e-dd9a6b176e52","block_type":"box","text":"generate long-term financial returns.","page_number":228,"box":{"x":68,"y":468,"width":258,"height":11}},{"id":"0a419b68-e9a7-42a4-ad29-47a73dfab952","block_type":"box","text":"14","page_number":228,"box":{"x":328,"y":468,"width":9,"height":5}},{"id":"d6b0b029-b6d2-4762-978d-cd42e38008d1","block_type":"box","text":"For these companies, we rely on disclosures to understand how their","page_number":228,"box":{"x":344,"y":468,"width":490,"height":11}},{"id":"628517d4-7686-40de-8569-3be484d5b06b","block_type":"box","text":"strategies consider nature-related impacts and dependencies and to assess how the board oversees these risks.","page_number":228,"box":{"x":69,"y":483,"width":807,"height":11}},{"id":"07630405-c69a-45c6-b0fe-9be8460fc933","block_type":"box","text":"15","page_number":228,"box":{"x":878,"y":484,"width":9,"height":4}},{"id":"97fc1438-edb0-4cb2-86b5-e3480eeb944e","block_type":"box","text":"COMPANIES’ IMPACT ON THEIR WORKFORCE, SUPPLY CHAINS, AND COMMUNITIES","page_number":228,"box":{"x":179,"y":513,"width":620,"height":11}},{"id":"7f2ee13e-16d9-44e1-bf47-e2dfb8596499","block_type":"box","text":"Companies determine their key stakeholders based on what is material to their business and long-term financial","page_number":228,"box":{"x":102,"y":536,"width":799,"height":11}},{"id":"fbf22583-f946-44e4-9d4b-6dba29664572","block_type":"box","text":"per formance. For many companies, key stakeholders include employees, business supply chains, clients and","page_number":228,"box":{"x":70,"y":551,"width":778,"height":11}},{"id":"f2f74214-0fd4-4083-b185-9da03dd6126d","block_type":"box","text":"consumers, regulators, and the communities in which they operate.","page_number":228,"box":{"x":69,"y":566,"width":479,"height":11}},{"id":"97f8034f-09cc-40e5-9cc3-67c844f28104","block_type":"box","text":"In our experience, companies that invest in the relationships that are critical to their strategic objectives are","page_number":228,"box":{"x":102,"y":589,"width":770,"height":11}},{"id":"e97687d8-a825-45b7-af7b-f7be7ef65f3d","block_type":"box","text":"more likely to deliver durable, long-term financial per formance. By contrast, we have found that poor relationships","page_number":228,"box":{"x":69,"y":604,"width":810,"height":11}},{"id":"6a22f6ba-fbdf-4e17-84ef-4bbc25521aca","block_type":"box","text":"12","page_number":228,"box":{"x":69,"y":634,"width":9,"height":4}},{"id":"d9fbf7a5-e995-40d5-8cd4-d9282a578ffd","block_type":"box","text":"We have observed that more companies are developing such plans, and public policymakers in cer tain markets are","page_number":228,"box":{"x":83,"y":633,"width":823,"height":12}},{"id":"4281e647-c1ca-4f4e-b347-4e9c03340859","block_type":"box","text":"signaling their intentions to require them or already have requirements in place, such as Australia, Brazil, and the","page_number":228,"box":{"x":69,"y":649,"width":808,"height":11}},{"id":"f41d1c6b-8ab5-4405-92fb-babfedf630e6","block_type":"box","text":"European Union (please see the International Transition Plan Network for information). We view transition plans as a","page_number":228,"box":{"x":70,"y":663,"width":827,"height":11}},{"id":"045bbe93-ef9b-4cc0-b495-84e0101ab913","block_type":"box","text":"method for a company to both internally assess and externally communicate its long-term strategy, ambition,","page_number":228,"box":{"x":69,"y":679,"width":774,"height":11}},{"id":"77579537-b892-48e0-9118-7944e0e3f1c2","block_type":"box","text":"objectives, and actions to create financial value through the global transition towards a low-carbon economy. Across","page_number":228,"box":{"x":69,"y":694,"width":825,"height":11}},{"id":"622fbc02-50fe-4144-97fb-1997208f8306","block_type":"box","text":"the landscape there remains divergence on the objectives of such plans and the details they should contain. While","page_number":228,"box":{"x":68,"y":709,"width":819,"height":11}},{"id":"57f808c8-6cbf-4e6e-aa13-96c0670c666e","block_type":"box","text":"transition plans can be helpful disclosure, BIS does not make the preparation and production of transition plans a","page_number":228,"box":{"x":68,"y":724,"width":813,"height":11}},{"id":"37a26262-5542-4197-9616-4c49c976fea6","block_type":"box","text":"voting issue. BIS may engage companies that have chosen to publish a transition plan to understand their planned","page_number":228,"box":{"x":68,"y":739,"width":819,"height":11}},{"id":"823fbd3b-92dd-4db2-975d-302a278eaeab","block_type":"box","text":"actions and resource implications. Website accessed in December 2025.","page_number":228,"box":{"x":69,"y":754,"width":522,"height":11}},{"id":"13be30ec-ea41-47ba-b300-5e9efc781546","block_type":"box","text":"13","page_number":228,"box":{"x":69,"y":772,"width":9,"height":5}},{"id":"dfca7ef0-3386-45da-8a13-cf30fcf22a06","block_type":"box","text":"For more information, please see our commentary “Climate-related risks and a low-carbon transition,” December","page_number":228,"box":{"x":84,"y":772,"width":804,"height":11}},{"id":"7fee9529-a8d3-4145-b3be-c65a7635ef24","block_type":"box","text":"2025.","page_number":228,"box":{"x":69,"y":787,"width":42,"height":9}},{"id":"2c59fa1d-b124-4d76-975b-939db3c9a31c","block_type":"box","text":"14","page_number":228,"box":{"x":69,"y":805,"width":9,"height":4}},{"id":"12266b72-e9ec-465e-a19f-837bef0ba006","block_type":"box","text":"For more information, please see our commentary “Our approach to engagement on natural capital,” December","page_number":228,"box":{"x":84,"y":805,"width":796,"height":11}},{"id":"40331422-31f8-47bc-b521-3523c2591e13","block_type":"box","text":"2025.","page_number":228,"box":{"x":69,"y":820,"width":42,"height":9}},{"id":"708e3472-8d8b-4960-81ad-d891440d557a","block_type":"box","text":"15","page_number":228,"box":{"x":69,"y":838,"width":9,"height":4}},{"id":"ade31310-07b3-4b7b-8d17-091419b0eb0f","block_type":"box","text":"Given the growing awareness of the materiality of these issues for cer tain businesses, enhanced repor ting on a","page_number":228,"box":{"x":84,"y":837,"width":797,"height":12}},{"id":"016317cf-036e-45f1-8d09-bc5aa843d7f7","block_type":"box","text":"company’s natural capital dependencies and impacts would aid investors’ understanding. The recommendations of","page_number":228,"box":{"x":69,"y":852,"width":820,"height":12}},{"id":"939e5e6f-e5ab-4a87-83b1-258df287d837","block_type":"box","text":"the Taskforce on Nature-related Financial Disclosures (TNFD) may prove useful to some companies. We recognize that","page_number":228,"box":{"x":68,"y":868,"width":842,"height":11}},{"id":"f76d8dfc-f363-480a-977a-ba983ede7c11","block_type":"box","text":"some companies may repor t using different standards, which may be required by regulation, or one of a number of","page_number":228,"box":{"x":69,"y":883,"width":820,"height":11}},{"id":"f755e9bb-a850-4207-b7bf-321565eaa43b","block_type":"box","text":"other private sector standards. TNFD-aligned repor ting is not a voting issue. Website accessed in December 2025.","page_number":228,"box":{"x":69,"y":898,"width":817,"height":11}},{"id":"67f9875c-2a60-40bd-bf04-2acf637988f5","block_type":"box","text":"BlackRock Investment Stewardship","page_number":228,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"1fce351c-d2e6-4a87-9250-57da4622d015","block_type":"box","text":"Global Principles | 11","page_number":228,"box":{"x":758,"y":942,"width":151,"height":13}},{"id":"f02edf5e-62e6-462d-84ee-1db21a2d4e50","block_type":"box","text":"NM1026U-6033063-228/246","page_number":228,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"61454f16-e05f-4722-aa55-37a19cffb8cb","block_type":"box","text":"may create adverse impacts that could expose companies to legal, regulatory, operational, and reputational risks.","page_number":229,"box":{"x":69,"y":45,"width":811,"height":11}},{"id":"5a7facf5-7874-4375-87aa-fb22d5990b5a","block_type":"box","text":"This is par ticularly relevant to a company’s workforce, which is central to long-term financial value creation.","page_number":229,"box":{"x":68,"y":60,"width":764,"height":11}},{"id":"03d64d80-d278-4340-aade-6855d86e9ed7","block_type":"box","text":"16","page_number":229,"box":{"x":834,"y":60,"width":9,"height":5}},{"id":"25149b76-aa5a-4787-84b3-a1777a5cbf4a","block_type":"box","text":"As a long-term shareholder on behalf of our clients, we find it helpful when companies disclose how they have","page_number":229,"box":{"x":101,"y":82,"width":783,"height":12}},{"id":"967f35fe-54de-42e9-8d93-ec1788e48b00","block_type":"box","text":"identified their key stakeholders and considered their interests in business decision-making. In addition to","page_number":229,"box":{"x":70,"y":98,"width":755,"height":11}},{"id":"049efbc0-9406-4a14-a47b-46424975e220","block_type":"box","text":"understanding broader stakeholder relationships, BIS finds it helpful when companies discuss how they consider the","page_number":229,"box":{"x":69,"y":113,"width":831,"height":11}},{"id":"7beaf0e1-2bec-44a4-b7be-fcc8d5bf1f4d","block_type":"box","text":"needs of their workforce today, and the skills required for their future business strategy. We are also interested in","page_number":229,"box":{"x":69,"y":128,"width":809,"height":11}},{"id":"e01f0689-a1cc-485f-963e-a37beb5f29d2","block_type":"box","text":"understanding how the board monitors and engages on these matters, given it is well positioned to ensure that the","page_number":229,"box":{"x":69,"y":143,"width":821,"height":11}},{"id":"23cdcf08-6b29-4535-aeff-b953d6a1528f","block_type":"box","text":"approach taken by management is informed by and aligns with the company’s strategy. BIS does not direct a","page_number":229,"box":{"x":69,"y":158,"width":775,"height":11}},{"id":"1ec9d662-0333-47ed-a8a1-be9353727af0","block_type":"box","text":"company’s policies or practices, which are the responsibility of management and the board.","page_number":229,"box":{"x":69,"y":173,"width":653,"height":11}},{"id":"d7411974-993f-406e-85e8-a8da5116ec2d","block_type":"box","text":"In addition, we find it helpful when companies disclose their approach to addressing material adverse impacts","page_number":229,"box":{"x":102,"y":196,"width":784,"height":11}},{"id":"080a5bb9-6e4d-452c-b031-27f056596d40","block_type":"box","text":"that could arise from their business practices and affect critical relationships with their stakeholders. We encourage","page_number":229,"box":{"x":68,"y":211,"width":829,"height":11}},{"id":"181b6454-7716-4fc8-b17e-c195e0227b38","block_type":"box","text":"companies to implement, to the extent appropriate, monitoring processes (often referred to as due diligence) to","page_number":229,"box":{"x":69,"y":226,"width":797,"height":11}},{"id":"06433119-fec0-4ac7-88d7-c11083d2a051","block_type":"box","text":"identify and mitigate potential adverse impacts and grievance mechanisms to remediate any actual adverse material","page_number":229,"box":{"x":70,"y":241,"width":828,"height":11}},{"id":"9e103076-91ad-430e-beab-c99ae841123f","block_type":"box","text":"impacts.","page_number":229,"box":{"x":70,"y":257,"width":58,"height":10}},{"id":"0b0c46a5-245a-433c-be76-efdddf6eb85c","block_type":"box","text":"We look to boards to oversee management’s approach to addressing material risks related to key stakeholders","page_number":229,"box":{"x":101,"y":279,"width":794,"height":11}},{"id":"fbf71243-11c5-433c-85ec-708c8eb4d477","block_type":"box","text":"and may convey concerns about board oversight in our voting on director elections or suppor ting a business relevant","page_number":229,"box":{"x":69,"y":294,"width":831,"height":11}},{"id":"39972ad0-fab9-446c-b622-602b9445ee02","block_type":"box","text":"shareholder proposal when, in our assessment, the board is not acting in shareholders’ long-term financial interests.","page_number":229,"box":{"x":69,"y":309,"width":834,"height":11}},{"id":"bf8a5bc8-47a9-495d-b9e9-11854a2bf21c","block_type":"box","text":"BLACKROCK’S OVERSIGHT OF ITS INVESTMENT STEWARDSHIP ACTIVITIES","page_number":229,"box":{"x":213,"y":340,"width":553,"height":8}},{"id":"0520c515-ec21-42b1-9f59-b9cdd885554c","block_type":"box","text":"BIS’ governance structure suppor ts oversight and accountability of stewardship-related activities on behalf of","page_number":229,"box":{"x":102,"y":362,"width":778,"height":11}},{"id":"fc3fe137-ed67-4606-8d9b-cd5502dd6100","block_type":"box","text":"clients at the global and regional level.","page_number":229,"box":{"x":69,"y":377,"width":274,"height":12}},{"id":"71052abc-6d9b-4965-80c3-4c75c986b7e4","block_type":"box","text":"At the top of this governance structure, the risk-focused BIS Global Oversight Committee (the Committee)","page_number":229,"box":{"x":101,"y":400,"width":751,"height":11}},{"id":"09ee33b4-b0cc-4370-a774-1440d7a7051a","block_type":"box","text":"suppor ts BIS’ regulatory responsibilities in relation to proxy voting, including adherence to policies and procedures as","page_number":229,"box":{"x":69,"y":415,"width":840,"height":11}},{"id":"5166b39c-aa64-4a57-96d9-224ff269d699","block_type":"box","text":"well as market-level stewardship requirements. The Committee reviews and approves amendments to the Global","page_number":229,"box":{"x":68,"y":430,"width":802,"height":11}},{"id":"7f36dbc7-bb74-41c6-87b4-1906ef032c61","block_type":"box","text":"Principles and regional voting guidelines. The Committee also reviews periodic repor ts regarding the votes cast by","page_number":229,"box":{"x":69,"y":445,"width":813,"height":12}},{"id":"0eed0bde-c07e-4bbf-966c-819892784720","block_type":"box","text":"BIS on behalf of clients, as well as updates on material process issues, procedural changes, and other risk oversight","page_number":229,"box":{"x":70,"y":460,"width":835,"height":12}},{"id":"63accc2f-d449-4f96-b987-199d2d195130","block_type":"box","text":"considerations. The Committee is chaired by the Global Heads of the Investment Stewardship function and its","page_number":229,"box":{"x":69,"y":475,"width":783,"height":12}},{"id":"834d8702-3cce-4dd2-856f-57388ae9ea6b","block_type":"box","text":"members include senior BlackRock executives with legal, risk, and other experience relevant to team oversight who","page_number":229,"box":{"x":69,"y":491,"width":820,"height":11}},{"id":"436302da-c27f-4295-9572-0322a843f0d4","block_type":"box","text":"are independent from the investment stewardship function.","page_number":229,"box":{"x":69,"y":506,"width":421,"height":11}},{"id":"3897100e-b7b8-4542-9d55-98ab097226b3","block_type":"box","text":"The Global Heads have primary oversight of BIS’ activities globally, including voting in accordance with the Global","page_number":229,"box":{"x":101,"y":528,"width":804,"height":12}},{"id":"30c8ed81-8c17-4381-b958-fa890597dc89","block_type":"box","text":"Principles and regional voting guidelines. At the regional level, three regional Heads for the Americas, APAC, and","page_number":229,"box":{"x":69,"y":543,"width":798,"height":12}},{"id":"b6db40e0-2a49-4fbd-a855-cc6f5b223d3f","block_type":"box","text":"EMEA oversee BIS’ activities for their specific markets.","page_number":229,"box":{"x":70,"y":559,"width":389,"height":11}},{"id":"018f6c3a-97a2-41b4-8f26-b4e936eef38d","block_type":"box","text":"VOTE EXECUTION","page_number":229,"box":{"x":424,"y":589,"width":129,"height":9}},{"id":"c9769178-dd71-403d-b580-f2a98b363962","block_type":"box","text":"BIS votes proxies on behalf of index equity funds and accounts when authorized by our clients. We have","page_number":229,"box":{"x":102,"y":612,"width":739,"height":11}},{"id":"24ec5941-0a80-41e1-9474-d048b403209d","block_type":"box","text":"processes in place to consider all proxies for which we have voting authority, and submit voting decisions, or refrain","page_number":229,"box":{"x":70,"y":627,"width":822,"height":11}},{"id":"51ebb039-f017-49fc-bac2-91ba2218072b","block_type":"box","text":"from voting when logistical issues arise (see below). The BIS Benchmark Policies – and the vote decisions made","page_number":229,"box":{"x":68,"y":642,"width":801,"height":11}},{"id":"9091917f-de2f-437f-856e-e793291913be","block_type":"box","text":"consistent with those policies – reflect our reasonable and independent judgment and are made without regard to the","page_number":229,"box":{"x":69,"y":657,"width":838,"height":11}},{"id":"60245f14-f2b4-4e8d-907c-34e6bfa73ead","block_type":"box","text":"relationship between the issuer of the proxy (or any shareholder proponent or dissident shareholder) and the Fund,","page_number":229,"box":{"x":69,"y":672,"width":817,"height":11}},{"id":"aed52794-6973-45da-895e-41342111f8a9","block_type":"box","text":"the Fund’s affiliates (if any), BlackRock or BlackRock’s affiliates, or BlackRock employees (see “Conflicts","page_number":229,"box":{"x":68,"y":687,"width":751,"height":11}},{"id":"50a05be1-59cf-43e9-b0e2-e58a84a94aaf","block_type":"box","text":"management policies and procedures,” below).","page_number":229,"box":{"x":69,"y":703,"width":334,"height":11}},{"id":"7bc630c6-2fb9-4a66-9814-c3b42b597a97","block_type":"box","text":"In cer tain markets, proxy voting involves logistical issues which can affect BIS’ ability to vote, as well as the cost","page_number":229,"box":{"x":102,"y":725,"width":806,"height":11}},{"id":"4fe3e044-8e01-4b63-b10e-4208826ca01b","block_type":"box","text":"of voting such proxies on behalf of our clients. These issues include, but are not limited to: 1) untimely notice of","page_number":229,"box":{"x":69,"y":740,"width":801,"height":11}},{"id":"96307499-2b68-4a7b-b679-9130c4517cc2","block_type":"box","text":"shareholder meetings; 2) restrictions on a foreigner’s ability to exercise votes; 3) requirements to vote proxies in","page_number":229,"box":{"x":69,"y":755,"width":805,"height":11}},{"id":"a60f7c3a-561f-44ac-abf3-fc6436f34d21","block_type":"box","text":"person; 4) “share-blocking” (requirements that investors who exercise their voting rights surrender the right to","page_number":229,"box":{"x":70,"y":771,"width":783,"height":11}},{"id":"c968bc7c-e2b5-486f-8236-fb60ea800a8e","block_type":"box","text":"dispose of their holdings from the point at which votes are submitted until after the after the shareholder meeting","page_number":229,"box":{"x":69,"y":785,"width":811,"height":12}},{"id":"faa8b1ff-6d19-4f8e-889e-973cbbd084a0","block_type":"box","text":"has occurred); 5) potential difficulties in translating the proxy; 6) regulatory constraints; and 7) requirements to","page_number":229,"box":{"x":69,"y":801,"width":795,"height":11}},{"id":"7b40d218-7499-4e7c-bae5-d1e25487f5b8","block_type":"box","text":"provide local agents with powers of attorney to facilitate voting instructions. We are not suppor tive of impediments to","page_number":229,"box":{"x":70,"y":816,"width":835,"height":11}},{"id":"37421e2c-1365-4b3a-8545-6fe9180501c0","block_type":"box","text":"the exercise of voting rights such as share-blocking or overly burdensome administrative requirements.","page_number":229,"box":{"x":68,"y":831,"width":732,"height":11}},{"id":"2fa0de02-85b1-44c7-bb4a-c5015b669342","block_type":"box","text":"16","page_number":229,"box":{"x":69,"y":860,"width":9,"height":5}},{"id":"8f903078-31d0-4253-b45c-de97e242dd9d","block_type":"box","text":"For more information, please see our commentary “Our approach to engagement on human capital management,”","page_number":229,"box":{"x":84,"y":860,"width":814,"height":11}},{"id":"13065092-8fb1-42c0-b860-b0267b0bf887","block_type":"box","text":"December 2025.","page_number":229,"box":{"x":70,"y":875,"width":118,"height":9}},{"id":"1164ee43-5174-4c94-8a5e-197e40473095","block_type":"box","text":"BlackRock Investment Stewardship","page_number":229,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"c2668ec6-72e9-47d0-8a65-6d1589c1aa26","block_type":"box","text":"Global Principles | 12","page_number":229,"box":{"x":758,"y":942,"width":151,"height":13}},{"id":"2b668552-f8eb-4cfc-97d7-778d3ef13e7d","block_type":"box","text":"NM1026U-6033063-229/246","page_number":229,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"72e54455-b0a9-447f-b048-b641047598fa","block_type":"box","text":"BIS votes proxies in these situations on a “best-effor ts” basis. In addition, BIS may determine that it is generally","page_number":230,"box":{"x":102,"y":45,"width":807,"height":11}},{"id":"40788d16-abb3-49ca-8c9c-53f21989f49d","block_type":"box","text":"in the interests of BlackRock’s clients not to vote proxies (or not to vote our full allocation) if the costs (including but","page_number":230,"box":{"x":70,"y":60,"width":830,"height":11}},{"id":"edf5ed94-dadb-4d7e-b102-18af661c650d","block_type":"box","text":"not limited to oppor tunity costs associated with share-blocking constraints) associated with exercising a vote are","page_number":230,"box":{"x":69,"y":75,"width":805,"height":11}},{"id":"cf3f93ec-273b-4f78-b901-b0599f002837","block_type":"box","text":"expected to outweigh the benefit the client would derive by voting on the proposal.","page_number":230,"box":{"x":69,"y":90,"width":585,"height":11}},{"id":"452a623a-a58a-4e36-86e4-1cc297f2391d","block_type":"box","text":"CONFLICTS MANAGEMENT POLICIES AND PROCEDURES","page_number":230,"box":{"x":281,"y":120,"width":416,"height":9}},{"id":"056412d4-e6fc-4f10-871c-25e8e9d325dc","block_type":"box","text":"BIS is a dedicated function whose responsibilities are separate from BlackRock’s sales, business par tnership or","page_number":230,"box":{"x":102,"y":143,"width":804,"height":11}},{"id":"eec7c00f-1dd4-4b5f-94bf-1cafe1b0c0cc","block_type":"box","text":"enterprise-level vendor management activities.","page_number":230,"box":{"x":69,"y":158,"width":329,"height":11}},{"id":"081465e7-a8cb-4051-9818-2c7eb195767c","block_type":"box","text":"BlackRock maintains policies and procedures that are designed to prevent undue influence on BIS’ proxy voting","page_number":230,"box":{"x":102,"y":181,"width":794,"height":11}},{"id":"0e54658c-4a4a-40a3-8530-f85b12c0f1c7","block_type":"box","text":"activity. Such influence might stem from any relationship between the investee company (or any shareholder","page_number":230,"box":{"x":69,"y":196,"width":771,"height":11}},{"id":"4ab93d19-924e-4000-b645-8854d08d88b9","block_type":"box","text":"proponent or dissident shareholder) and BlackRock, BlackRock’s affiliates, a Fund or a Fund’s affiliates, or","page_number":230,"box":{"x":70,"y":211,"width":763,"height":11}},{"id":"6a3ef92e-865a-4bcc-8f6d-b42cccec3c69","block_type":"box","text":"BlackRock employees.","page_number":230,"box":{"x":70,"y":226,"width":157,"height":11}},{"id":"d8dce26d-83e8-4f42-a5a5-d6bd468537f6","block_type":"box","text":"For information on how BIS manages conflicts of interest, please see our disclosure.","page_number":230,"box":{"x":102,"y":249,"width":602,"height":11}},{"id":"a13646ae-3c69-4506-a9fe-61878fbb1263","block_type":"box","text":"SECURITIES LENDING","page_number":230,"box":{"x":409,"y":279,"width":159,"height":9}},{"id":"384efe3b-e3c9-4c75-8cad-7f1f915f310a","block_type":"box","text":"When authorized, BlackRock acts as a securities lending agent on behalf of its clients. Lending securities","page_number":230,"box":{"x":101,"y":302,"width":751,"height":11}},{"id":"9afe9a83-cc9f-4a8e-ba6e-53d8c75cedc6","block_type":"box","text":"enables BlackRock to increase the returns in clients’ por tfolios, and BlackRock’s lending agreements allow it to","page_number":230,"box":{"x":69,"y":317,"width":797,"height":11}},{"id":"d18da298-c540-43c0-be69-6819fd30bceb","block_type":"box","text":"recall securities out on loan at any time. BlackRock (or any other lender) does not retain voting rights for securities","page_number":230,"box":{"x":69,"y":332,"width":817,"height":11}},{"id":"403e92b9-bc51-40c0-a47c-58b8fb291187","block_type":"box","text":"out on loan. Entitlements associated with the lent securities (dividends, coupons, etc.), while on loan are paid back","page_number":230,"box":{"x":69,"y":347,"width":823,"height":11}},{"id":"a6bbfa0a-d7cc-4192-9f33-c90322be5533","block_type":"box","text":"to the lender of the security as stipulated in industry standard legal agreements.","page_number":230,"box":{"x":68,"y":362,"width":575,"height":11}},{"id":"ea537b62-4a67-4dc3-bcd1-a85724834722","block_type":"box","text":"With regard to the relationship between securities lending and proxy voting, BlackRock cannot vote shares on","page_number":230,"box":{"x":101,"y":385,"width":779,"height":11}},{"id":"555085bf-b7c5-4d7b-ab51-92ea89a9a2dc","block_type":"box","text":"loan and may determine to recall them for voting, as guided by our fiduciary duty as an asset manager to our clients","page_number":230,"box":{"x":70,"y":400,"width":827,"height":11}},{"id":"6484f322-a39e-41fc-9404-284e493890df","block_type":"box","text":"in helping them achieve their investment goals. While this has occurred in a limited number of cases, the decision to","page_number":230,"box":{"x":70,"y":415,"width":832,"height":11}},{"id":"3969f1cf-3d58-4a87-b278-a3ebb1ba531a","block_type":"box","text":"recall securities on loan as par t of BlackRock’s securities lending program in order to vote is based on an evaluation","page_number":230,"box":{"x":69,"y":430,"width":832,"height":11}},{"id":"87239850-3fc3-45c3-9ddd-a10de0b2d745","block_type":"box","text":"of various factors that include, but are not limited to, assessing potential securities lending revenue alongside the","page_number":230,"box":{"x":69,"y":445,"width":814,"height":12}},{"id":"370c86c1-f7ca-461a-8420-e43c38f560a3","block_type":"box","text":"potential long-term financial value to clients of voting those securities (based on the information available at the time","page_number":230,"box":{"x":70,"y":460,"width":834,"height":12}},{"id":"61c12973-b6e7-4889-a0f8-cfcff773e425","block_type":"box","text":"of recall consideration).","page_number":230,"box":{"x":69,"y":475,"width":166,"height":12}},{"id":"07d57205-23a9-42b1-bb88-59bdfabf21c0","block_type":"box","text":"17","page_number":230,"box":{"x":237,"y":476,"width":9,"height":4}},{"id":"04bf0410-dc74-439c-821f-c7d19d6a26be","block_type":"box","text":"BIS works with colleagues in the Securities Lending and Risk and Quantitative Analysis","page_number":230,"box":{"x":252,"y":476,"width":617,"height":11}},{"id":"6b215041-ac4c-43cf-9da8-a56441eb1109","block_type":"box","text":"teams to evaluate the costs and benefits to clients of recalling shares on loan.","page_number":230,"box":{"x":68,"y":491,"width":563,"height":11}},{"id":"d89e5ec4-a3be-4144-a608-9469abe6815b","block_type":"box","text":"In almost all instances, BlackRock anticipates that the potential long-term financial value to clients of voting","page_number":230,"box":{"x":102,"y":513,"width":770,"height":12}},{"id":"cda0a842-c26a-4fc8-8a70-1cf7d73efd09","block_type":"box","text":"shares would be less than the potential revenue the loan may provide clients. However, in cer tain instances,","page_number":230,"box":{"x":69,"y":529,"width":774,"height":11}},{"id":"d9362990-0169-4a91-961d-96b548caec7d","block_type":"box","text":"BlackRock may determine, in our independent business judgment as a fiduciary, that the value of voting outweighs","page_number":230,"box":{"x":70,"y":543,"width":816,"height":12}},{"id":"b921ca95-aa82-4300-8fad-fc00aef5611a","block_type":"box","text":"the securities lending revenue loss to clients and would therefore recall shares to be voted in those instances. It is","page_number":230,"box":{"x":68,"y":559,"width":822,"height":11}},{"id":"cbed5259-d9be-4077-a8d8-79e57d0eef0f","block_type":"box","text":"impor tant to note that the majority of lendable assets in the market at any given time are not out on loan.","page_number":230,"box":{"x":70,"y":574,"width":752,"height":11}},{"id":"530223c7-b978-44bf-8b93-782a531b6af5","block_type":"box","text":"Periodically, BlackRock reviews our process for determining whether to recall securities on loan in order to vote","page_number":230,"box":{"x":102,"y":596,"width":790,"height":12}},{"id":"3e49d334-7622-421f-bfb3-0ea6e3830a41","block_type":"box","text":"and may modify it as necessary.","page_number":230,"box":{"x":69,"y":612,"width":228,"height":11}},{"id":"6a7af693-9951-4f0c-876b-6a32ea46c37a","block_type":"box","text":"VOTING CHOICE","page_number":230,"box":{"x":430,"y":642,"width":117,"height":9}},{"id":"49b74924-fb73-4294-9017-e6965df75cc5","block_type":"box","text":"BlackRock offers Voting Choice, a program that provides eligible clients with more oppor tunities to par ticipate in","page_number":230,"box":{"x":102,"y":664,"width":800,"height":12}},{"id":"73459ff5-8f59-4c52-9626-134170290a1a","block_type":"box","text":"the proxy voting process, where legally and operationally viable.","page_number":230,"box":{"x":68,"y":680,"width":452,"height":11}},{"id":"e27c9a94-ac4d-4a4b-8251-316d801c8c7f","block_type":"box","text":"18","page_number":230,"box":{"x":522,"y":680,"width":9,"height":4}},{"id":"a37930dc-6295-4569-9109-8b04ddd21547","block_type":"box","text":"Voting Choice is currently available for eligible clients invested in cer tain institutional pooled funds in the U.S.,","page_number":230,"box":{"x":101,"y":702,"width":786,"height":12}},{"id":"d14aac51-12a9-4536-8f59-5b97bbcb4a69","block_type":"box","text":"UK, Ireland, Canada, and Switzerland that utilize index equity investment strategies, as well as eligible clients in","page_number":230,"box":{"x":70,"y":718,"width":797,"height":11}},{"id":"32227d76-7df5-4d11-8922-b996dcc18307","block_type":"box","text":"17","page_number":230,"box":{"x":69,"y":747,"width":8,"height":4}},{"id":"93881ccc-2891-4dc7-bef3-2a69a199d6a3","block_type":"box","text":"Recalling securities on loan can be impacted by the timing of record dates. In the U.S., for example, the record","page_number":230,"box":{"x":84,"y":747,"width":789,"height":11}},{"id":"f853f936-575d-4b11-a914-4690f66bbeca","block_type":"box","text":"date of a shareholder meeting typically falls before the proxy statements are released. Accordingly, it is not","page_number":230,"box":{"x":69,"y":762,"width":763,"height":11}},{"id":"9c7741a4-a2c7-46c2-a1de-488af94fc173","block_type":"box","text":"practicable to evaluate a proxy statement, determine that a vote has a material impact on a fund and recall any","page_number":230,"box":{"x":70,"y":777,"width":794,"height":11}},{"id":"e6087ec7-66ff-46c2-af5c-287ab882c1a0","block_type":"box","text":"shares on loan in advance of the record date for the annual meeting. As a result, managers must weigh independent","page_number":230,"box":{"x":69,"y":792,"width":833,"height":11}},{"id":"8d4b0a30-16ca-4f8c-8eac-99a4e980a111","block_type":"box","text":"business judgement as a fiduciary, the benefit to a fund’s shareholders of recalling loaned shares in advance of an","page_number":230,"box":{"x":69,"y":807,"width":821,"height":11}},{"id":"15ac4f12-5cb8-444b-b18a-8a29380845a2","block_type":"box","text":"estimated record date without knowing whether there will be a vote on matters which have a material impact on the","page_number":230,"box":{"x":69,"y":822,"width":823,"height":12}},{"id":"eacb8756-8228-4f6a-beef-5b5c642fe83b","block_type":"box","text":"fund (thereby forgoing potential securities lending revenue for the fund’s shareholders) or leaving shares on loan to","page_number":230,"box":{"x":68,"y":837,"width":822,"height":12}},{"id":"65722116-1ff5-47c3-9132-90792b92c359","block_type":"box","text":"potentially earn revenue for the fund (thereby forgoing the oppor tunity to vote).","page_number":230,"box":{"x":70,"y":852,"width":558,"height":12}},{"id":"1be03ac5-f195-47b8-acc8-5a5b51ad760a","block_type":"box","text":"18","page_number":230,"box":{"x":69,"y":870,"width":9,"height":5}},{"id":"b35641db-e3a7-4198-be4a-8e427a770e91","block_type":"box","text":"BlackRock will determine eligibility criteria under this program based upon, among other things, local market","page_number":230,"box":{"x":84,"y":870,"width":771,"height":11}},{"id":"70ca8a21-9a91-4498-bc1c-d2e4b2cdf982","block_type":"box","text":"regulation and practice, cost considerations, operational risk and/or complexity, and financial considerations,","page_number":230,"box":{"x":69,"y":885,"width":779,"height":11}},{"id":"2033210a-db51-400e-b427-ddb8c4d7ca94","block_type":"box","text":"including the decision to lend securities.","page_number":230,"box":{"x":70,"y":901,"width":285,"height":11}},{"id":"4d371144-1122-4edc-94ad-cbee1e06e8b6","block_type":"box","text":"BlackRock Investment Stewardship","page_number":230,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"6c21a255-20a1-4fc8-95d8-73dfa8284a9e","block_type":"box","text":"Global Principles | 13","page_number":230,"box":{"x":758,"y":942,"width":151,"height":13}},{"id":"5a37578c-4f01-43f7-96a6-cabaebee5c26","block_type":"box","text":"NM1026U-6033063-230/246","page_number":230,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"4ca6c1f3-8631-4572-95ad-dc4112792d4f","block_type":"box","text":"cer tain institutional pooled funds in the U.S., UK, Canada, and Switzerland that use systematic active equity","page_number":231,"box":{"x":69,"y":45,"width":772,"height":11}},{"id":"b14d2b88-005f-4d49-989f-63725672dcf1","block_type":"box","text":"(SAE) strategies. In addition, institutional clients in separately managed accounts (SMAs) continue to be eligible for","page_number":231,"box":{"x":69,"y":60,"width":822,"height":11}},{"id":"3ad5339a-ee8d-4d37-ba09-1c2d74d0b3b1","block_type":"box","text":"BlackRock Voting Choice regardless of their investment strategies.","page_number":231,"box":{"x":70,"y":75,"width":471,"height":11}},{"id":"3d0ab6d5-e32c-47ee-927c-54ca2449aa63","block_type":"box","text":"19","page_number":231,"box":{"x":543,"y":75,"width":9,"height":5}},{"id":"2e343001-43d5-4e5a-866b-c006b71ac2c9","block_type":"box","text":"Voting Choice is also available for eligible U.S.","page_number":231,"box":{"x":558,"y":75,"width":328,"height":11}},{"id":"95cd410c-67eb-4984-93df-a900b48e91f7","block_type":"box","text":"retail shareholder accounts invested in BlackRock’s largest U.S. exchange-traded fund.","page_number":231,"box":{"x":69,"y":90,"width":619,"height":11}},{"id":"8873b888-951c-4427-af4f-c8a8339ff556","block_type":"box","text":"20","page_number":231,"box":{"x":690,"y":90,"width":9,"height":5}},{"id":"84042456-3565-4a1a-bee2-4d5df7b58944","block_type":"box","text":"As a result, the shares attributed to BlackRock por tfolios in company share registers may be voted differently","page_number":231,"box":{"x":101,"y":113,"width":782,"height":11}},{"id":"c4d8db71-d889-4a54-b6bb-b90adf7df4ac","block_type":"box","text":"depending on whether our clients have authorized BIS to vote on their behalf, have authorized BIS to vote in","page_number":231,"box":{"x":69,"y":128,"width":767,"height":11}},{"id":"b137c7db-6f2c-495d-b620-bb1a34e88ec9","block_type":"box","text":"accordance with a third-par ty policy, or have elected to vote shares in accordance with their own policy. Our clients","page_number":231,"box":{"x":69,"y":143,"width":814,"height":11}},{"id":"bc57f795-f32d-47fb-bcf8-4215abde4bfc","block_type":"box","text":"have greater control over proxy voting because of Voting Choice.","page_number":231,"box":{"x":69,"y":158,"width":454,"height":11}},{"id":"0ae509fd-a94e-4b5f-97bb-6a32d8a8ba72","block_type":"box","text":"21","page_number":231,"box":{"x":525,"y":158,"width":9,"height":5}},{"id":"b6c94aa8-27c7-4dcc-afe8-9992646b83df","block_type":"box","text":"REPORTING AND VOTE TRANSPARENCY","page_number":231,"box":{"x":343,"y":188,"width":293,"height":9}},{"id":"8a4fa536-b93d-45c2-a36c-143f09e5a171","block_type":"box","text":"We are committed to transparency of the stewardship work we do on behalf of clients. We inform clients about","page_number":231,"box":{"x":101,"y":211,"width":789,"height":11}},{"id":"1d34b982-d517-41e2-ae79-c6f9fbf1fcce","block_type":"box","text":"our engagement and voting policies and activities through direct communication and through disclosure on our","page_number":231,"box":{"x":69,"y":226,"width":787,"height":11}},{"id":"b8c5f70d-7eca-4585-bce4-0822113aef4d","block_type":"box","text":"website. We make public our regional voting guidelines for the benefit of clients and the companies in which we","page_number":231,"box":{"x":68,"y":241,"width":795,"height":11}},{"id":"d5caa92e-541d-4454-928a-abc4902ff53d","block_type":"box","text":"invest on their behalf. We also publish commentaries to share our approach to engagement on our five engagement","page_number":231,"box":{"x":70,"y":256,"width":825,"height":12}},{"id":"c2be45c5-710d-4f26-8a75-2268f4e0c290","block_type":"box","text":"priorities, as well as quar terly repor ts detailing our proxy voting and engagement activities.","page_number":231,"box":{"x":70,"y":272,"width":644,"height":11}},{"id":"218230ad-7c53-4f6e-bf57-989307e062de","block_type":"box","text":"19","page_number":231,"box":{"x":69,"y":324,"width":9,"height":4}},{"id":"14b3c81f-2c11-421a-9eb5-94212b179272","block_type":"box","text":"With Voting Choice, SMA clients have the ability to select the policy that best aligns with their views and","page_number":231,"box":{"x":83,"y":323,"width":739,"height":12}},{"id":"009f3a54-ddff-44bb-b0a2-792c020f61eb","block_type":"box","text":"preferences from a set of voting policies from third-par ty proxy advisers. 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Fur ther, the Guidelines consider the","page_number":237,"box":{"x":102,"y":45,"width":751,"height":11}},{"id":"4f02b0dc-da84-479c-997b-d9ac9424ca3c","block_type":"box","text":"differences between the actions and outcomes over which company management has influence, and those it","page_number":237,"box":{"x":101,"y":60,"width":778,"height":11}},{"id":"1650a8dd-5822-43ed-8a1f-e71ae33822c1","block_type":"box","text":"does not.","page_number":237,"box":{"x":101,"y":75,"width":66,"height":9}},{"id":"39c95b6d-67f8-4f64-8c7f-93b93d8c237d","block_type":"box","text":"•","page_number":237,"box":{"x":69,"y":98,"width":6,"height":4}},{"id":"6ec8dce3-78d0-43a8-9774-0afaa0aea641","block_type":"box","text":"Focus on useful, contextualized disclosures that help inform investors views, while recognizing data","page_number":237,"box":{"x":102,"y":95,"width":729,"height":11}},{"id":"c8c3e22a-a64c-43c3-90ee-afa53bdb6f4c","block_type":"box","text":"limitations:","page_number":237,"box":{"x":102,"y":110,"width":80,"height":9}},{"id":"963dbe8b-fad8-4ba7-acdc-f07f9fb5b708","block_type":"box","text":"Under the Guidelines, the dedicated team looks for disclosures that outline key milestones and","page_number":237,"box":{"x":189,"y":110,"width":679,"height":11}},{"id":"bd5fc611-0acd-4dcf-a698-916b936ba5a5","block_type":"box","text":"dependencies underpinning the company’s low-carbon transition strategy, explain the trade-offs required to adapt","page_number":237,"box":{"x":101,"y":125,"width":807,"height":12}},{"id":"7f6766c0-e812-4989-8b63-35b92e741998","block_type":"box","text":"the business model, and include relevant data and narrative.","page_number":237,"box":{"x":101,"y":141,"width":433,"height":10}},{"id":"34454880-68e6-4eb0-bfb7-7c2b4e73d60a","block_type":"box","text":"•","page_number":237,"box":{"x":69,"y":163,"width":6,"height":5}},{"id":"02bba33a-8266-41c8-a716-423c9976f8b2","block_type":"box","text":"Consistency with the participating clients’ position as a minority investor:","page_number":237,"box":{"x":101,"y":161,"width":541,"height":11}},{"id":"3c446f5d-c0fe-4cd8-8754-aec8c27373b3","block_type":"box","text":"The boards and executive leadership","page_number":237,"box":{"x":648,"y":161,"width":261,"height":11}},{"id":"001c6b75-cea2-4311-9a81-32242c71f4d5","block_type":"box","text":"of companies determine a company’s strategy and its implementation. Under the Guidelines, the dedicated team","page_number":237,"box":{"x":102,"y":176,"width":805,"height":11}},{"id":"f6ea9ec3-950b-4e3a-8d44-077c9cb5974f","block_type":"box","text":"makes decisions on how to engage companies and vote proxies independently, based on its professional","page_number":237,"box":{"x":102,"y":191,"width":748,"height":11}},{"id":"1d34b91c-144d-41d5-9905-abe7a1db0e1c","block_type":"box","text":"judgment of the priorities and outcomes most aligned with par ticipating clients’ investment objectives.","page_number":237,"box":{"x":100,"y":206,"width":730,"height":11}},{"id":"c8e4afbd-eb72-465f-8895-ac0032667ad3","block_type":"box","text":"Voting approach under the Guidelines","page_number":237,"box":{"x":68,"y":236,"width":273,"height":11}},{"id":"9d1c061a-bc0c-4471-92dd-3040c72bc82e","block_type":"box","text":"12","page_number":237,"box":{"x":342,"y":237,"width":9,"height":4}},{"id":"555af1a3-0ddf-4390-a30b-834b1c4521f9","block_type":"box","text":"When evaluating each voting item across management or shareholder proposals, the dedicated team applies a","page_number":237,"box":{"x":101,"y":259,"width":791,"height":11}},{"id":"85d49cd3-7cca-4f5e-9e75-51f735fae8d8","block_type":"box","text":"case-by-case approach that reflects the uneven pace of the low-carbon transition across sectors and markets, and","page_number":237,"box":{"x":69,"y":274,"width":813,"height":11}},{"id":"38daed01-42bf-4006-8449-8cf3c44d8761","block_type":"box","text":"acknowledges the distinction between what company management can influence and what lies beyond its control. As","page_number":237,"box":{"x":69,"y":289,"width":833,"height":11}},{"id":"07f6ace7-b598-4d07-b5df-f3af25a545e5","block_type":"box","text":"a result, voting decisions — on behalf of in-scope funds and SMAs — on similar proposals included on different","page_number":237,"box":{"x":69,"y":304,"width":799,"height":11}},{"id":"091b0bed-efc4-4c3c-afa7-eb7810ff2b5f","block_type":"box","text":"companies’ shareholder meeting agendas may vary depending on company, sector, or market-specific circumstances.","page_number":237,"box":{"x":69,"y":319,"width":837,"height":12}},{"id":"50cd0813-99c4-4559-ac10-e62b98277496","block_type":"box","text":"Consistent with the investment objective of each fund or account that has selected these Guidelines, the","page_number":237,"box":{"x":102,"y":342,"width":748,"height":11}},{"id":"59ac0f3a-3c09-4ef4-b38a-378682f5af2c","block_type":"box","text":"dedicated team will look to the companies to demonstrate the following:","page_number":237,"box":{"x":69,"y":357,"width":513,"height":11}},{"id":"c6ce0695-5471-423a-9b3a-613b683094e0","block_type":"box","text":"Corporate Disclosures","page_number":237,"box":{"x":69,"y":387,"width":160,"height":11}},{"id":"8dfe96e1-6d7e-4cb2-adc3-94ed6ec6ab45","block_type":"box","text":"13","page_number":237,"box":{"x":230,"y":388,"width":9,"height":4}},{"id":"92b8f66f-3e72-4738-9318-a9fc65597f45","block_type":"box","text":"In the context of these Guidelines, the dedicated team looks for companies to provide sufficient disclosure to","page_number":237,"box":{"x":102,"y":410,"width":781,"height":11}},{"id":"a6b69ce2-4a60-4624-915b-765412bf6a06","block_type":"box","text":"assess whether the company’s strategy is aligned with the low-carbon transition. As a general point, the team looks","page_number":237,"box":{"x":69,"y":425,"width":825,"height":11}},{"id":"ac677530-cfab-4b4e-8779-934ccdb9353b","block_type":"box","text":"to companies that are impor tant to the transition to a low-carbon economy to explain the strategy and governance","page_number":237,"box":{"x":68,"y":440,"width":812,"height":12}},{"id":"75edc389-7541-4c39-8afb-e932860b5fbe","block_type":"box","text":"frameworks that they have determined most appropriate, which may include:","page_number":237,"box":{"x":68,"y":455,"width":545,"height":11}},{"id":"d5690063-db2a-4b26-bd29-2e9bf95ed084","block_type":"box","text":"(1) a low-carbon transition strategy to demonstrate their alignment with the ambition to limit average global","page_number":237,"box":{"x":69,"y":476,"width":769,"height":11}},{"id":"cc205936-5303-4bfc-a575-72a84d23adbc","block_type":"box","text":"temperature rise to 1.5°C above pre-industrial levels. This would typically include a long-term strategy to achieve","page_number":237,"box":{"x":101,"y":491,"width":800,"height":11}},{"id":"e27e70ff-8969-4830-ab9d-14409a75b24d","block_type":"box","text":"net-zero GHG emissions by 2050, with appropriate near- and medium-term milestones to assess their progress.","page_number":237,"box":{"x":102,"y":506,"width":796,"height":11}},{"id":"6a8296ff-5775-4cda-9802-d7ae1fee5d8c","block_type":"box","text":"(2) low-carbon transition-related repor ting. Standardized disclosure of sustainability-related data suppor ts investors","page_number":237,"box":{"x":69,"y":526,"width":828,"height":11}},{"id":"2493a552-1617-41c8-8fc2-fd6a850e2b7f","block_type":"box","text":"in making informed decisions. The International Sustainability Standards Board (ISSB) standards, IFRS S1 and","page_number":237,"box":{"x":102,"y":541,"width":787,"height":11}},{"id":"ceba534c-a30a-4e5a-be4b-1f5f65d4dc6c","block_type":"box","text":"S2, represent one such approach to standardization that the dedicated team finds useful in its analysis.","page_number":237,"box":{"x":102,"y":556,"width":741,"height":11}},{"id":"a1fb0022-e8b2-446f-a6b7-5b935bc1dcee","block_type":"box","text":"14, 15","page_number":237,"box":{"x":845,"y":557,"width":25,"height":5}},{"id":"f65ce3ba-2288-4986-af05-49cfc838d858","block_type":"box","text":"IFRS","page_number":237,"box":{"x":877,"y":556,"width":30,"height":9}},{"id":"9e8db4e6-d87a-4be6-ba65-74c822885c8f","block_type":"box","text":"S1 addresses the general requirements of sustainability repor ting and IFRS S2 sets out the disclosures that","page_number":237,"box":{"x":102,"y":571,"width":774,"height":12}},{"id":"e2817efb-450e-4abc-a2b4-799bb6135bc6","block_type":"box","text":"provide investors with decision-useful information about a company’s most significant climate- and low-carbon","page_number":237,"box":{"x":102,"y":586,"width":781,"height":12}},{"id":"c5b1b470-26ed-455e-a43f-8230cbcb9114","block_type":"box","text":"transition-related risks and oppor tunities. This includes receiving independent, third-par ty assurances, as audit","page_number":237,"box":{"x":101,"y":602,"width":792,"height":11}},{"id":"3021ea7c-df4f-4dd3-a26f-8e789aa34087","block_type":"box","text":"and assurance standards are developed.","page_number":237,"box":{"x":102,"y":617,"width":290,"height":11}},{"id":"96cb1cbe-cb42-428c-9d22-394414b0753c","block_type":"box","text":"12","page_number":237,"box":{"x":69,"y":646,"width":9,"height":5}},{"id":"8b60fb1b-389b-4cf0-b64f-9634355cb14b","block_type":"box","text":"These Guidelines are not intended to limit the analysis of individual issues at specific companies or provide a guide","page_number":237,"box":{"x":83,"y":646,"width":825,"height":11}},{"id":"5fc34168-3c3d-4741-a611-521a517597e6","block_type":"box","text":"as to how the dedicated team will engage and/or vote in every instance. The Guidelines are applied by the dedicated","page_number":237,"box":{"x":69,"y":661,"width":833,"height":11}},{"id":"d79ee732-c50d-4a18-8702-c2898e9220e9","block_type":"box","text":"team with discretion, on a case-by-case basis, taking into consideration the range of issues and facts specific to the","page_number":237,"box":{"x":68,"y":676,"width":830,"height":11}},{"id":"187e040e-2f8f-4038-98df-91d0b97e079f","block_type":"box","text":"company, as well as individual ballot items at shareholder meetings.","page_number":237,"box":{"x":69,"y":691,"width":486,"height":11}},{"id":"f1169f10-bfdd-49b8-b5ee-955c599df6ae","block_type":"box","text":"13","page_number":237,"box":{"x":69,"y":709,"width":9,"height":5}},{"id":"610d801b-138b-4c63-8b48-25c523842f3c","block_type":"box","text":"Given data and measurement limitations, companies may need to provide estimated GHG emissions where","page_number":237,"box":{"x":84,"y":709,"width":764,"height":11}},{"id":"72019e3d-562b-40ba-a71e-c55c01dceff2","block_type":"box","text":"repor ting methodologies are nascent. In addition, cer tain disclosures related to a company’s plans for adapting their","page_number":237,"box":{"x":69,"y":724,"width":834,"height":11}},{"id":"69d710fd-2b34-4f33-b0ce-f261e3f69da7","block_type":"box","text":"business models through the low-carbon transition may require forward-looking statements.","page_number":237,"box":{"x":69,"y":739,"width":651,"height":11}},{"id":"9b432122-d64b-4e6e-b88b-d61dc555a98f","block_type":"box","text":"14","page_number":237,"box":{"x":69,"y":757,"width":9,"height":4}},{"id":"4f8d0838-fc7a-412f-bcf8-53df1834aa1e","block_type":"box","text":"The ISSB is an independent standard-setting body within the International Financial Repor ting Standards","page_number":237,"box":{"x":83,"y":757,"width":744,"height":11}},{"id":"7c267287-c636-400a-823c-ccd5e62394e2","block_type":"box","text":"(IFRS) Foundation. The standards build on the Task Force on Climate-related Financial Disclosures (TCFD) framework","page_number":237,"box":{"x":69,"y":772,"width":828,"height":11}},{"id":"852a9b59-8208-4fc2-81e5-1a3bd5071f54","block_type":"box","text":"and the standards and metrics developed by the Sustainability Accounting Standards Board (SASB), which have both","page_number":237,"box":{"x":69,"y":787,"width":830,"height":11}},{"id":"31ff9548-d952-47b0-a7a8-79fc667805d1","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":237,"box":{"x":69,"y":802,"width":809,"height":11}},{"id":"6fcc0fb8-4242-49fc-8148-665a38c44f62","block_type":"box","text":"“General Requirements for Disclosure of Sustainability-related Financial Information” and S2 “Climate-related","page_number":237,"box":{"x":70,"y":817,"width":778,"height":11}},{"id":"daa84200-9a6f-4902-8339-2a774a989872","block_type":"box","text":"Disclosures.” Websites accessed in December 2025.","page_number":237,"box":{"x":70,"y":832,"width":380,"height":9}},{"id":"4352fc4b-fcf1-4e5f-bf4e-c62d54408557","block_type":"box","text":"15","page_number":237,"box":{"x":69,"y":850,"width":9,"height":5}},{"id":"22583f60-f636-48ad-a653-82e3d51d28c5","block_type":"box","text":"A number of jurisdictions are consulting on adopting the standards issued to date or have already committed to","page_number":237,"box":{"x":83,"y":850,"width":795,"height":11}},{"id":"9e15253b-3ed4-47b8-845d-62e379a45573","block_type":"box","text":"doing so. BIS does not mandate any specific disclosure framework companies should use, and recognize that some","page_number":237,"box":{"x":69,"y":865,"width":826,"height":11}},{"id":"2efd24e3-dfd7-442d-8660-2536c3f3f6c2","block_type":"box","text":"companies may repor t using different standards, some of which may be required by regulation. In such cases, we","page_number":237,"box":{"x":69,"y":880,"width":811,"height":11}},{"id":"ecb12df2-00f8-4c8e-9055-454f7ecd328e","block_type":"box","text":"ask that companies highlight the metrics that are industry- or company-specific. We also recognize that companies","page_number":237,"box":{"x":69,"y":895,"width":816,"height":12}},{"id":"6a85f1bb-5113-43ff-bb12-9e53abf8f187","block_type":"box","text":"may be phasing in repor ting over several years. We do not prescribe timelines regarding when companies should","page_number":237,"box":{"x":69,"y":911,"width":803,"height":11}},{"id":"fa1fbfc0-9c20-4332-983f-430f13e50eca","block_type":"box","text":"BlackRock Investment Stewardship","page_number":237,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"3b7443c4-0080-4b51-be6d-42a576de7549","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines | 5","page_number":237,"box":{"x":509,"y":942,"width":400,"height":13}},{"id":"b3bfd988-8352-4946-854c-80cba9333c24","block_type":"box","text":"NM1026U-6033063-237/246","page_number":237,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"979ae9ba-6363-4d36-aa51-baf9b6e2230e","block_type":"box","text":"(3) scope 1 and scope 2, and most significant scope 3 GHG emissions","page_number":238,"box":{"x":69,"y":45,"width":513,"height":11}},{"id":"ec0597ae-0d28-46aa-96ee-12caf657a627","block_type":"box","text":"16, 17","page_number":238,"box":{"x":583,"y":45,"width":26,"height":5}},{"id":"d1127fba-9353-4616-817a-94d6eb332eb2","block_type":"box","text":"In addition, the dedicated team looks to","page_number":238,"box":{"x":615,"y":45,"width":283,"height":10}},{"id":"d25086d0-4013-412a-8f2e-a6dbbcfd9159","block_type":"box","text":"companies to disclose their emissions reduction targets for scope 1 and 2 emissions, science-based where","page_number":238,"box":{"x":101,"y":60,"width":770,"height":11}},{"id":"b49e89a1-398a-40f1-8f30-596a2edf552f","block_type":"box","text":"possible. The team welcomes disclosure of targets or indicative goals, where companies have set them, for","page_number":238,"box":{"x":102,"y":75,"width":768,"height":11}},{"id":"fe313a78-7f9e-4db5-a4f6-7be8bf347cc7","block_type":"box","text":"scope 3 emissions reductions. 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For some companies that play an impor tant role in the low-carbon transition, scope","page_number":238,"box":{"x":101,"y":166,"width":807,"height":11}},{"id":"ece19d71-3d2b-4eb6-bee9-db659d989b37","block_type":"box","text":"3 may represent their only significant source of GHG emissions in the value chain. While we do not believe","page_number":238,"box":{"x":102,"y":181,"width":759,"height":11}},{"id":"1cf1bc06-8526-4419-bbae-b74b608ba0d2","block_type":"box","text":"companies should be required to enforce emissions reduction targets outside of their control, where relevant, we","page_number":238,"box":{"x":101,"y":196,"width":808,"height":11}},{"id":"37302a96-9343-471b-99ad-cdeadfb4e55a","block_type":"box","text":"look for disclosures on how the company approaches the low-carbon transition in these cases. 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As defined by the ISSB, a transition plan “lays out the entity’s targets, actions or resources for","page_number":238,"box":{"x":68,"y":375,"width":831,"height":11}},{"id":"ea49a56c-0050-4ba2-8439-6dd30a0cb0f1","block_type":"box","text":"its transition towards a lower-carbon economy, including actions such as reducing its greenhouse gas emissions”","page_number":238,"box":{"x":70,"y":390,"width":805,"height":11}},{"id":"ec56777a-307c-4c1e-bf26-7577238cf916","block_type":"box","text":"(see Appendix 1).","page_number":238,"box":{"x":69,"y":405,"width":122,"height":11}},{"id":"c2618255-3c0f-4126-b735-140a6e45356a","block_type":"box","text":"19","page_number":238,"box":{"x":193,"y":405,"width":9,"height":5}},{"id":"06bf4b9b-c1ef-4c05-814b-cd5282f58a18","block_type":"box","text":"Work is also underway in a number of jurisdictions on establishing a common approach in a market to corporate","page_number":238,"box":{"x":101,"y":428,"width":800,"height":11}},{"id":"27ebffb6-364f-4e2b-b109-9a7539821f3f","block_type":"box","text":"transition plans.","page_number":238,"box":{"x":68,"y":443,"width":115,"height":11}},{"id":"a524360f-1ac9-4257-8cf9-9f7ad2420fdd","block_type":"box","text":"20","page_number":238,"box":{"x":184,"y":443,"width":9,"height":5}},{"id":"cb704e4e-77d8-4089-a798-b233b212df3a","block_type":"box","text":"Recent guidance from the ISSB on disclosures about transition plans highlights the convergence of","page_number":238,"box":{"x":200,"y":443,"width":706,"height":11}},{"id":"db21e908-2631-4a8b-99aa-2750f4619e52","block_type":"box","text":"repor ting approaches.","page_number":238,"box":{"x":69,"y":458,"width":156,"height":11}},{"id":"bdaa6c8f-7f59-41f9-8dc0-3ac530eb24b9","block_type":"box","text":"While the preparation of a transition plan, or lack thereof, is not, in itself, a voting issue, these disclosures","page_number":238,"box":{"x":101,"y":481,"width":762,"height":11}},{"id":"bdc32032-a515-4f52-881d-38b56583cc55","block_type":"box","text":"typically provide valuable insights that inform the dedicated team’s approach to engaging and voting on matters","page_number":238,"box":{"x":68,"y":496,"width":796,"height":11}},{"id":"6f264ddf-44a3-4518-b475-97efb239b027","block_type":"box","text":"related to climate and transition risks on behalf of in-scope funds and accounts.","page_number":238,"box":{"x":69,"y":511,"width":570,"height":11}},{"id":"47a1b7dd-75f6-434e-83e8-bfa43bfcb9f7","block_type":"box","text":"make sustainability-related disclosures but appreciate it when companies produce them sufficiently in advance of","page_number":238,"box":{"x":69,"y":537,"width":810,"height":12}},{"id":"e5668330-98f9-4592-949a-7be6ecefccb0","block_type":"box","text":"their shareholder meeting, to the best of their abilities, to provide investors with time to assess the data and make","page_number":238,"box":{"x":68,"y":553,"width":822,"height":11}},{"id":"778aa9e6-c4e5-4f43-a23d-9f6dade6fe1a","block_type":"box","text":"informed voting decisions.","page_number":238,"box":{"x":70,"y":568,"width":184,"height":11}},{"id":"b67b2086-50a8-475f-9d59-369ea7511f60","block_type":"box","text":"16","page_number":238,"box":{"x":69,"y":586,"width":9,"height":4}},{"id":"a593c1ce-12fd-4076-a131-c98bd1f8fa32","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":238,"box":{"x":84,"y":585,"width":825,"height":12}},{"id":"87250238-4046-44c3-9387-8191fc89f687","block_type":"box","text":"paper: FTSE Russel, “Scope for improvement: Solving the Scope 3 conundrum,” January 2024, accessed in","page_number":238,"box":{"x":70,"y":600,"width":768,"height":12}},{"id":"880677c5-8a84-4b74-844b-2f125060d2ff","block_type":"box","text":"December 2025.","page_number":238,"box":{"x":70,"y":616,"width":118,"height":9}},{"id":"cc757d01-64be-4e8a-9e4c-12507d31c8df","block_type":"box","text":"17","page_number":238,"box":{"x":69,"y":634,"width":8,"height":4}},{"id":"506f69c2-eb6d-46cb-bcb2-46b57550ae32","block_type":"box","text":"Under this policy, the dedicated team looks for GHG emissions disclosures to be aligned with the Greenhouse Gas","page_number":238,"box":{"x":84,"y":633,"width":815,"height":12}},{"id":"14949623-d8d5-4551-ab65-bee8fdd9efb7","block_type":"box","text":"Protocol (GHG Protocol). The Protocol Standards and Guidance are currently being updated to ensure they continue to","page_number":238,"box":{"x":69,"y":648,"width":838,"height":12}},{"id":"3a9b2edd-1322-4415-af20-09e52d744cf5","block_type":"box","text":"provide “a rigorous and credible accounting foundation for businesses to measure, plan and track progress toward","page_number":238,"box":{"x":70,"y":663,"width":816,"height":12}},{"id":"958b0f5f-2c1b-48d7-9138-c879cbdcef74","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":238,"box":{"x":69,"y":679,"width":784,"height":11}},{"id":"611d5d11-e786-4941-bd49-b91fb6327102","block_type":"box","text":"18","page_number":238,"box":{"x":69,"y":697,"width":9,"height":4}},{"id":"c9166ba1-11ab-4a5b-8e77-e6e8185a1dd8","block_type":"box","text":"The dedicated team does not believe the purpose of scope 3 disclosure requirements should be to push publicly","page_number":238,"box":{"x":83,"y":696,"width":804,"height":11}},{"id":"62a8796d-0d54-488c-811a-06ed03ee10af","block_type":"box","text":"traded companies into the role of enforcing emission reduction targets outside of their control. Given methodological","page_number":238,"box":{"x":68,"y":711,"width":832,"height":12}},{"id":"81a9849f-0e28-4596-a24e-ceb921f0a451","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":238,"box":{"x":69,"y":726,"width":832,"height":12}},{"id":"b652d85c-09b1-4e49-98d7-4a9819f7a6c8","block_type":"box","text":"useful when companies focus their disclosures on those of the fifteen scope 3 GHG Protocol categories that are","page_number":238,"box":{"x":69,"y":742,"width":800,"height":11}},{"id":"fc47fdee-3276-4e11-9069-4ddffa0e7034","block_type":"box","text":"material to their business models.","page_number":238,"box":{"x":69,"y":757,"width":243,"height":9}},{"id":"7aa01ac4-bed7-44e5-8eb1-db010acc2cd1","block_type":"box","text":"19","page_number":238,"box":{"x":69,"y":775,"width":9,"height":4}},{"id":"90570f58-6810-4d1e-8967-c725d779b572","block_type":"box","text":"International Financial Repor ting Standards, “IFRS S2: Climate-related Disclosures,” June 2023, accessed in","page_number":238,"box":{"x":84,"y":774,"width":777,"height":12}},{"id":"0190d2bb-ccf9-4a44-bfcb-0143b5f1fb16","block_type":"box","text":"December 2025.","page_number":238,"box":{"x":70,"y":790,"width":118,"height":8}},{"id":"db6d1d2b-1cef-4300-91f0-72102b89d1db","block_type":"box","text":"20","page_number":238,"box":{"x":69,"y":807,"width":9,"height":5}},{"id":"c2e6c041-5307-413b-8aa8-420e32a63801","block_type":"box","text":"More companies are developing such plans, and public policymakers in cer tain markets are signaling their","page_number":238,"box":{"x":84,"y":807,"width":758,"height":11}},{"id":"04820cb0-2e95-4db9-8f43-13c73085c2b9","block_type":"box","text":"intentions to require them or already have requirements in place, such as Australia, Brazil, and the European Union","page_number":238,"box":{"x":70,"y":822,"width":820,"height":11}},{"id":"195c57e0-9058-45c0-ac3d-5ffc4209ea20","block_type":"box","text":"(please see the International Transition Plan Network for information). 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The directors most likely to be in focus are the chair of the board","page_number":239,"box":{"x":69,"y":629,"width":780,"height":11}},{"id":"2b8cb1ad-ea1e-4112-aa47-78c20dde43f9","block_type":"box","text":"committee with low-carbon transition, climate or sustainability risk oversight responsibilities, other members of the","page_number":239,"box":{"x":69,"y":644,"width":817,"height":12}},{"id":"4cb63935-e30e-4819-8559-22104fc1aeed","block_type":"box","text":"relevant committee, the lead independent director or the non-executive chair of the board. 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Similarly, the dedicated team generally suppor ts management’s proposal on a progress repor t if the","page_number":240,"box":{"x":68,"y":203,"width":792,"height":12}},{"id":"0b48b4ce-0d71-467f-b5d6-85e0c66ecc9e","block_type":"box","text":"company has clearly explained its progress against, and any deviations from or changes to, its stated low-carbon","page_number":240,"box":{"x":69,"y":218,"width":803,"height":12}},{"id":"ea4544c6-40b3-48a6-99f0-bc3d8678725b","block_type":"box","text":"transition plan and targets.","page_number":240,"box":{"x":68,"y":234,"width":193,"height":11}},{"id":"d0f305f1-459d-4bdc-b989-aae596cb7b54","block_type":"box","text":"Shareholder proposals on climate and low-carbon transition matters","page_number":240,"box":{"x":68,"y":264,"width":495,"height":11}},{"id":"30165231-3e8e-4a3f-bf8d-7dcb7953b276","block_type":"box","text":"In most markets, shareholders can submit proposals to be voted on at a company’s shareholder meeting, as","page_number":240,"box":{"x":102,"y":287,"width":777,"height":11}},{"id":"018cab38-baa8-49b3-b22f-9a9428b74de9","block_type":"box","text":"long as cer tain requirements are met. 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Under these Guidelines, the dedicated team engages,","page_number":240,"box":{"x":69,"y":670,"width":808,"height":11}},{"id":"77f1ab4e-cbc3-4e4b-bba4-710caf3e63d9","block_type":"box","text":"where appropriate, to enhance its understanding of a company’s approach. 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In such cases, the","page_number":240,"box":{"x":69,"y":783,"width":826,"height":11}},{"id":"fc1dc73f-76d9-47c8-8f3a-7c668d978f4b","block_type":"box","text":"dedicated team would engage to understand the alignment between those metrics and the company’s stated climate","page_number":240,"box":{"x":69,"y":798,"width":834,"height":11}},{"id":"bb6cc90a-d90f-4acb-a788-9394ffb99822","block_type":"box","text":"24","page_number":240,"box":{"x":69,"y":828,"width":9,"height":4}},{"id":"9c35d1fd-7db9-4506-a1aa-2b4b1767ce6a","block_type":"box","text":"While the dedicated team may escalate voting by not suppor ting additional management proposals, principally","page_number":240,"box":{"x":83,"y":827,"width":787,"height":12}},{"id":"8c4c178a-2cca-42ef-b184-863970201dea","block_type":"box","text":"director elections, the team does not consider filing shareholder proposals, preannouncing voting intentions or using","page_number":240,"box":{"x":69,"y":842,"width":832,"height":12}},{"id":"3a3c9b3f-f959-4b5f-b83e-9ca4630bbef8","block_type":"box","text":"the media to amplify concerns as appropriate courses of action. 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The team notes that assurance of corporate disclosures related to climate risk and the","page_number":241,"box":{"x":69,"y":158,"width":812,"height":11}},{"id":"56ff4a21-ae20-4e05-9fca-ab29d10938b4","block_type":"box","text":"transition to a low-carbon economy is still nascent.","page_number":241,"box":{"x":68,"y":173,"width":361,"height":11}},{"id":"f64d83af-836a-48ea-87dd-24cee3988ff6","block_type":"box","text":"Mergers, acquisitions, asset sales, and other special situations","page_number":241,"box":{"x":69,"y":203,"width":463,"height":11}},{"id":"c3e41bb7-53a6-4476-8259-5f9477cbc08f","block_type":"box","text":"Special situations will be considered on their financial merits, but the dedicated team may engage on climate","page_number":241,"box":{"x":102,"y":226,"width":783,"height":11}},{"id":"519e2790-782c-49dd-a9b1-fb4b3e19b456","block_type":"box","text":"related factors under these Guidelines where a transaction may significantly alter a company’s climate strategy or a","page_number":241,"box":{"x":69,"y":241,"width":824,"height":11}},{"id":"27ac8c51-5a4d-4180-807d-35a131005160","block_type":"box","text":"shareholder activist has proposed governance, strategic or operational changes that may impact its climate strategy.","page_number":241,"box":{"x":69,"y":257,"width":831,"height":11}},{"id":"3d105249-ba57-4176-ba00-85413ed64a32","block_type":"box","text":"The dedicated team does not promote changes in corporate control or engage in shareholder activism.","page_number":241,"box":{"x":68,"y":272,"width":731,"height":11}},{"id":"86abce4f-7b57-4e9c-8e08-557ba72072f8","block_type":"box","text":"Other business relevant sustainability-related risks and opportunities","page_number":241,"box":{"x":69,"y":302,"width":503,"height":11}},{"id":"51ad08a5-14dd-48bd-8f45-1fcceca25ece","block_type":"box","text":"Climate risk and the transition to a low-carbon economy are interconnected with a number of other material","page_number":241,"box":{"x":102,"y":324,"width":762,"height":11}},{"id":"ef3e0215-6c7e-4be7-b0c4-59f00c7d4200","block_type":"box","text":"sustainability-related risks and oppor tunities that may be relevant to a company’s business model and long-term","page_number":241,"box":{"x":69,"y":340,"width":802,"height":11}},{"id":"daaefdab-83e9-46e5-a064-df27d1da78c5","block_type":"box","text":"financial per formance. These include a company’s impacts or dependencies on natural capital and key","page_number":241,"box":{"x":68,"y":355,"width":734,"height":11}},{"id":"b15d0e0c-976d-42f9-9f83-51757bd7d0e4","block_type":"box","text":"stakeholders.","page_number":241,"box":{"x":69,"y":370,"width":95,"height":9}},{"id":"d67ab7a5-dca1-47ce-a782-6c732b4fc61a","block_type":"box","text":"26","page_number":241,"box":{"x":166,"y":370,"width":9,"height":5}},{"id":"ca8c07b8-8dfc-4a05-8188-389002f40eb3","block_type":"box","text":"In the context of these Guidelines, the dedicated team may engage companies to better understand","page_number":241,"box":{"x":182,"y":370,"width":710,"height":11}},{"id":"a3f277d3-f0b6-44f7-8c70-66c6fb0ff1a8","block_type":"box","text":"how they are managing the impact on people (e.g., employees, suppliers, customers and communities) of any","page_number":241,"box":{"x":69,"y":385,"width":783,"height":11}},{"id":"8d3c7c87-7a03-48cd-af4a-d8cce66d8bab","block_type":"box","text":"strategic or operational changes they are making in relation to their transition to a low-carbon economy. Similarly, the","page_number":241,"box":{"x":69,"y":400,"width":832,"height":11}},{"id":"9ba19a9a-4064-49dc-b19f-841a16e5a52c","block_type":"box","text":"team may engage companies that face risks and oppor tunities related to land use and deforestation, access to fresh","page_number":241,"box":{"x":68,"y":415,"width":838,"height":11}},{"id":"c0292e49-a2de-4fc0-8bcc-f8acf624e2ba","block_type":"box","text":"water, or the ability to secure scarce resources critical to the transition to a low-carbon economy.","page_number":241,"box":{"x":68,"y":430,"width":690,"height":11}},{"id":"d4ba9abd-a8dd-402c-8af6-864e0cf50181","block_type":"box","text":"26","page_number":241,"box":{"x":69,"y":475,"width":9,"height":4}},{"id":"2beb62ee-7ea9-47bc-9e64-1a0019d7e7db","block_type":"box","text":"Engagement with companies on these issues is informed by BIS’ commentaries on natural capital, human capital","page_number":241,"box":{"x":84,"y":474,"width":807,"height":12}},{"id":"0e0d1f21-9439-4891-8830-a09ebae24433","block_type":"box","text":"management, and corporate human rights risks, December 2025.","page_number":241,"box":{"x":69,"y":490,"width":468,"height":11}},{"id":"44ecd6f2-ebcc-4bc8-b958-e4e227cf9239","block_type":"box","text":"BlackRock Investment Stewardship","page_number":241,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"96f9d447-496e-4221-b8ae-cc3e6edea360","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines | 9","page_number":241,"box":{"x":509,"y":942,"width":400,"height":13}},{"id":"e27fa14e-e28d-4a5e-a09f-6a0bfb5e58b1","block_type":"box","text":"NM1026U-6033063-241/246","page_number":241,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"ae088d47-d79e-4216-9b95-55e1a5c64c3d","block_type":"box","text":"Appendix 1","page_number":242,"box":{"x":68,"y":45,"width":82,"height":11}},{"id":"103fba4d-c365-46b2-9d0f-3a2df1623e94","block_type":"box","text":"Terminology","page_number":242,"box":{"x":68,"y":75,"width":87,"height":11}},{"id":"792e43bb-ff71-4fce-a234-db4386645de9","block_type":"box","text":"We understand the key concepts referred to within these Guidelines as follows:","page_number":242,"box":{"x":101,"y":98,"width":565,"height":11}},{"id":"f5e8ef7c-7722-4d01-864f-8c1ae8a41a0e","block_type":"box","text":"Climate risk:","page_number":242,"box":{"x":101,"y":120,"width":92,"height":9}},{"id":"b5601075-1562-4ba1-8588-c8ac9709e3b3","block_type":"box","text":"Includes physical risk, the increased risk to companies’ assets and activities caused by the direct","page_number":242,"box":{"x":200,"y":120,"width":698,"height":11}},{"id":"ee7cda04-2051-4de4-b1df-a9c419d7553f","block_type":"box","text":"impact of changing weather patterns and natural catastrophes, and transition risk, the impact of the transition to a","page_number":242,"box":{"x":70,"y":135,"width":818,"height":12}},{"id":"51dc2d81-53d9-4112-943f-093d1cdcf885","block_type":"box","text":"low-carbon economy on a company’s long-term profitability.","page_number":242,"box":{"x":70,"y":150,"width":416,"height":12}},{"id":"412fcf47-094b-4484-bad7-bc3210ac7104","block_type":"box","text":"Transition to a low-carbon economy (“low-carbon transition”):","page_number":242,"box":{"x":101,"y":173,"width":449,"height":11}},{"id":"0f351b72-b423-4cf3-b9dd-53b94253d899","block_type":"box","text":"The global economic shift toward lower","page_number":242,"box":{"x":556,"y":173,"width":278,"height":11}},{"id":"b992b152-ad37-4f42-82b5-37ef152aa387","block_type":"box","text":"emissions across many sectors and business models. The economic transformation is being driven by changes in","page_number":242,"box":{"x":69,"y":188,"width":811,"height":12}},{"id":"dbd1d660-26d5-4c4e-938e-fe6a99adc7bb","block_type":"box","text":"government policy, technology, and consumer and investor preferences, as well as the physical effects of climate","page_number":242,"box":{"x":68,"y":203,"width":807,"height":12}},{"id":"4b1bcaa9-0fd3-49e5-a821-9b5ffa2d1ac9","block_type":"box","text":"change (e.g., extreme weather), and can potentially have a material impact on clients’ investments and por tfolios.","page_number":242,"box":{"x":69,"y":218,"width":812,"height":12}},{"id":"1a699461-2d45-40b4-af06-0a4d45611864","block_type":"box","text":"Decarbonization:","page_number":242,"box":{"x":102,"y":241,"width":120,"height":9}},{"id":"e5e1fd1c-721d-4dc8-a9b1-4349c77131b0","block_type":"box","text":"the process of reducing or eliminating emissions of carbon dioxide (CO2) from human activity","page_number":242,"box":{"x":228,"y":241,"width":664,"height":11}},{"id":"542009db-7b7a-4262-b5c7-08b60d6bdcf8","block_type":"box","text":"and removing carbon currently in the atmosphere. This can be carried out by countries, companies and even","page_number":242,"box":{"x":69,"y":257,"width":771,"height":11}},{"id":"351ad342-3b79-4bbb-81f3-ef5b05f20f75","block_type":"box","text":"individual consumers. Sometimes the concept is understood to include the reduction and elimination of other GHG,","page_number":242,"box":{"x":70,"y":271,"width":820,"height":11}},{"id":"7ff10977-6d53-4c3f-ac8c-56cd62306393","block_type":"box","text":"e.g., methane.","page_number":242,"box":{"x":69,"y":287,"width":102,"height":11}},{"id":"c28db9f1-82af-45d8-9752-45f1c1764edd","block_type":"box","text":"Climate-related risks and opportunities:","page_number":242,"box":{"x":101,"y":309,"width":289,"height":11}},{"id":"5f10b858-0486-43aa-822b-0efb4a15a4fe","block_type":"box","text":"The investment oppor tunities and risks associated with the transition","page_number":242,"box":{"x":396,"y":309,"width":495,"height":11}},{"id":"9d65b01b-b584-45a9-a7a5-84bda45952d2","block_type":"box","text":"to a low-carbon economy, including transition risks and oppor tunities and physical risks and oppor tunities in adapting","page_number":242,"box":{"x":68,"y":325,"width":838,"height":11}},{"id":"47f28fac-7cad-42e3-bdf1-d5c271d4bc03","block_type":"box","text":"to physical climate change.","page_number":242,"box":{"x":68,"y":340,"width":193,"height":11}},{"id":"a174c9a2-dbea-41a9-b1d7-a9e39a43e2be","block_type":"box","text":"Climate-related transition plan:","page_number":242,"box":{"x":101,"y":362,"width":226,"height":11}},{"id":"0613523d-db76-40b0-9630-92d2a5b44ca7","block_type":"box","text":"“An aspect of an entity’s overall strategy that lays out the entity’s targets,","page_number":242,"box":{"x":334,"y":362,"width":525,"height":11}},{"id":"06a501fd-f222-4118-bf7f-0da10d8c851c","block_type":"box","text":"actions or resources for its transition towards a lower-carbon economy, including actions such as reducing its","page_number":242,"box":{"x":69,"y":377,"width":778,"height":12}},{"id":"e3919dcd-d9c9-49d3-845e-2cd23abed700","block_type":"box","text":"greenhouse gas emissions.”","page_number":242,"box":{"x":68,"y":393,"width":203,"height":11}},{"id":"5b165afb-ddf0-40e2-99aa-ca4356f302e0","block_type":"box","text":"27","page_number":242,"box":{"x":273,"y":393,"width":9,"height":4}},{"id":"2cd0be55-5f2f-42f2-9fe8-6ed518faf626","block_type":"box","text":"Science-based GHG emissions reduction targets:","page_number":242,"box":{"x":101,"y":415,"width":356,"height":11}},{"id":"66bdbcc9-afe0-49c9-b8f0-65860eb8ed8b","block_type":"box","text":"Targets that “","page_number":242,"box":{"x":463,"y":415,"width":96,"height":11}},{"id":"9da465e4-2bfa-421e-9982-9a82775599d8","block_type":"box","text":"are in line with what the latest climate science","page_number":242,"box":{"x":569,"y":415,"width":331,"height":9}},{"id":"1b2173f5-7449-4ba5-a7b7-a6f1ee2d5807","block_type":"box","text":"deems necessary to meet the goals of the Paris Agreement — limiting global warming to 1.5°C above pre-industrial","page_number":242,"box":{"x":69,"y":430,"width":822,"height":11}},{"id":"b2a244af-2237-4553-8d7b-d727817cc778","block_type":"box","text":"levels. Science-based targets give companies a clearly defined path to reduce GHG emissions in line with limiting","page_number":242,"box":{"x":70,"y":445,"width":806,"height":12}},{"id":"be5b0717-52bf-450e-8cce-688e26b522b8","block_type":"box","text":"global warming to 1.5°C. They define how much and how quickly a business must reduce its emissions to be in line","page_number":242,"box":{"x":68,"y":460,"width":824,"height":12}},{"id":"e7d5a1f2-ed02-4ee1-8399-1602941e3443","block_type":"box","text":"with the Paris Agreement goals.”","page_number":242,"box":{"x":68,"y":476,"width":232,"height":11}},{"id":"307f860c-5e5c-46c5-a071-b3945756f073","block_type":"box","text":"28","page_number":242,"box":{"x":302,"y":476,"width":9,"height":4}},{"id":"a0f962f0-1ecf-4316-b290-bb4ae06134de","block_type":"box","text":"Scope 1:","page_number":242,"box":{"x":101,"y":498,"width":63,"height":11}},{"id":"60453870-a2de-42af-8d69-5685ba433b4f","block_type":"box","text":"Direct GHG emissions. Direct GHG emissions occur from sources that are owned or controlled by the","page_number":242,"box":{"x":172,"y":498,"width":718,"height":11}},{"id":"b4db7998-430e-4268-9502-a649e438114e","block_type":"box","text":"company, for example, emissions from combustion in owned or controlled boilers, furnaces, vehicles, etc.; emissions","page_number":242,"box":{"x":69,"y":513,"width":836,"height":11}},{"id":"21389ba0-3a4d-410b-8e3d-28616c078dd5","block_type":"box","text":"from chemical production in owned or controlled process equipment.","page_number":242,"box":{"x":68,"y":528,"width":489,"height":11}},{"id":"b4b450b1-b67c-4f21-8956-8dbca9cfff26","block_type":"box","text":"29","page_number":242,"box":{"x":559,"y":529,"width":9,"height":4}},{"id":"4e2b9654-29a7-46f5-90de-ae3d48bbdc2c","block_type":"box","text":"Scope 2","page_number":242,"box":{"x":101,"y":551,"width":59,"height":11}},{"id":"8f868f6b-d7d6-4bbe-918f-674bed53ea6d","block_type":"box","text":": Electricity indirect GHG emissions Scope 2 accounts for GHG emissions from the generation of","page_number":242,"box":{"x":162,"y":551,"width":685,"height":11}},{"id":"ccecbcde-d953-4664-ba86-b831ec36c180","block_type":"box","text":"purchased electricity [steam, and heating/cooling] consumed by the company. [It] is defined as electricity [steam,","page_number":242,"box":{"x":70,"y":566,"width":807,"height":11}},{"id":"1e32ee40-f900-485a-a4be-c2890da6f669","block_type":"box","text":"and heating/cooling] that is purchased or otherwise brought into the organizational boundary of the company.","page_number":242,"box":{"x":69,"y":581,"width":781,"height":12}},{"id":"6d13f731-d388-4471-b19f-a13566b0f6a7","block_type":"box","text":"30","page_number":242,"box":{"x":852,"y":582,"width":9,"height":4}},{"id":"40a64b19-b3f8-4908-8df5-ea435ae5c86a","block_type":"box","text":"Scope 3:","page_number":242,"box":{"x":101,"y":604,"width":63,"height":11}},{"id":"043cc13a-af67-4572-93a2-f76a9853792c","block_type":"box","text":"Other indirect GHG emissions. Scope 3 is an optional repor ting category that allows for the treatment","page_number":242,"box":{"x":171,"y":604,"width":725,"height":11}},{"id":"0b30a05f-425b-4071-9252-1f3ec651208f","block_type":"box","text":"of all other indirect emissions. Scope 3 emissions are a consequence of the activities of the company, but occur","page_number":242,"box":{"x":69,"y":619,"width":803,"height":11}},{"id":"3a53b88d-c9c9-4220-a274-567ab8bef55c","block_type":"box","text":"from sources not owned or controlled by the company.","page_number":242,"box":{"x":68,"y":634,"width":386,"height":11}},{"id":"58389aa5-91d8-4237-b0dd-9117a2f01ab0","block_type":"box","text":"31","page_number":242,"box":{"x":456,"y":635,"width":9,"height":4}},{"id":"7b85d20a-3679-463c-952d-6c33f3d53174","block_type":"box","text":"27","page_number":242,"box":{"x":69,"y":679,"width":8,"height":4}},{"id":"b8f56736-c86c-4199-88fd-a3361e7bcc00","block_type":"box","text":"As defined by the International Financial Repor ting Standards, “IFRS S2: Climate-related Disclosures,” June 2023..","page_number":242,"box":{"x":83,"y":679,"width":821,"height":11}},{"id":"a2fd39b3-a6df-4e90-b150-0a23402df96d","block_type":"box","text":"Several jurisdictions are basing their own transition plan disclosure frameworks on the IFRS S2 definition. We","page_number":242,"box":{"x":69,"y":694,"width":779,"height":11}},{"id":"0a58271f-79a7-44b3-8abb-13e87933d507","block_type":"box","text":"anticipate transition plan disclosure becoming mandatory in an increasing number of jurisdictions over the near term.","page_number":242,"box":{"x":69,"y":709,"width":836,"height":11}},{"id":"1fd2ede7-7875-42e3-8bba-ff2184f052ce","block_type":"box","text":"28","page_number":242,"box":{"x":69,"y":727,"width":9,"height":4}},{"id":"ff5d5b9b-3949-4920-84c9-7c5797106014","block_type":"box","text":"As defined by the Science Based Targets initiative (SBTi). SBTi “is a corporate climate action organization that","page_number":242,"box":{"x":83,"y":726,"width":785,"height":12}},{"id":"c209589f-967f-439e-9cf8-6ad17ffbfef0","block_type":"box","text":"enables companies and financial institutions worldwide to play their par t in combating the climate crisis. 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