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I-25","page_number":2,"box":{"x":358,"y":207,"width":551,"height":9}},{"id":"cdb5f3f6-639c-44c2-9663-a0498e2e8c5d","block_type":"box","text":"Additional Information. . . . . . . . . . . . . . . . . . .","page_number":2,"box":{"x":68,"y":223,"width":308,"height":9}},{"id":"deb09028-985e-4de2-8b7d-8050c0919caf","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-27","page_number":2,"box":{"x":382,"y":223,"width":526,"height":9}},{"id":"852532ea-3b62-498e-a48a-5ac23843ce35","block_type":"box","text":"Financial Statements","page_number":2,"box":{"x":70,"y":239,"width":148,"height":9}},{"id":"6d96fd63-60ba-45e5-ac70-43bcd29b80b7","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 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I","page_number":2,"box":{"x":195,"y":386,"width":676,"height":8}},{"id":"2f1438e5-e0e4-48a5-a7cc-c734b6a24cda","block_type":"box","text":"I-122","page_number":2,"box":{"x":874,"y":386,"width":35,"height":8}},{"id":"1c311caf-032b-4cfe-aa87-d7391263e251","block_type":"box","text":"Portfolio Transactions and Brokerage . .","page_number":2,"box":{"x":69,"y":402,"width":283,"height":11}},{"id":"9ad9c5bd-3ec3-4a79-a07c-1ccc8a1685f4","block_type":"box","text":".............................................................. 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As a matter of policy, however, the Fund will not purchase shares of any registered open-end","page_number":8,"box":{"x":69,"y":846,"width":759,"height":11}},{"id":"0332e918-b517-4fb4-8afc-e99190f82d3b","block_type":"box","text":"investment company or registered unit investment trust, in reliance on Section 12(d)(1)(F) or (G) (the “fund of funds”","page_number":8,"box":{"x":70,"y":861,"width":829,"height":11}},{"id":"11f34095-727a-47b2-a09c-6bc1dbb544d5","block_type":"box","text":"provisions) of the Investment Company Act, at any time the Fund has knowledge that its shares are purchased by","page_number":8,"box":{"x":70,"y":876,"width":808,"height":11}},{"id":"d36ebabd-993e-4859-898e-ecdf04f40394","block_type":"box","text":"another investment company investor in reliance on the provisions of subparagraph (G) of Section 12(d)(1).","page_number":8,"box":{"x":69,"y":891,"width":763,"height":12}},{"id":"52fbf260-f41e-45ef-8155-e5f3b8232469","block_type":"box","text":"I-6","page_number":8,"box":{"x":481,"y":943,"width":17,"height":9}},{"id":"ba962f55-6739-4d65-abe5-aaa2a0567533","block_type":"box","text":"NM0926U-5977317-8/232","page_number":8,"box":{"x":764,"y":970,"width":141,"height":7}},{"id":"818e6231-7155-47b6-8da6-664d54814954","block_type":"box","text":"(b) Make short sales of securities or maintain a short position, except to the extent permitted by the Fund’s","page_number":9,"box":{"x":102,"y":45,"width":770,"height":11}},{"id":"64fc7584-34b1-4f35-b62d-c6ceb307d5c4","block_type":"box","text":"Prospectus and Statement of Additional Information, as amended from time to time, and applicable law.","page_number":9,"box":{"x":69,"y":60,"width":741,"height":11}},{"id":"93fc963b-ef4e-4092-b329-8d79f37ef403","block_type":"box","text":"In addition, as a non-fundamental investment policy, which may be changed by the Fund’s Board of Directors","page_number":9,"box":{"x":102,"y":82,"width":772,"height":12}},{"id":"252c29bd-c2b1-45a1-9671-c51c309883e9","block_type":"box","text":"without shareholder approval, and to the extent required by the Commission or its staff, the Fund will, for purposes of","page_number":9,"box":{"x":68,"y":98,"width":841,"height":11}},{"id":"6fa0b67b-e022-4137-8b63-f304057c5fd0","block_type":"box","text":"investment restriction (2), treat securities issued or guaranteed by the government of any one foreign country as the","page_number":9,"box":{"x":70,"y":113,"width":828,"height":11}},{"id":"cd4d80aa-fb8f-44a5-b8d1-fdb81d159920","block_type":"box","text":"obligations of a single issuer.","page_number":9,"box":{"x":69,"y":128,"width":207,"height":11}},{"id":"7f8ad049-c3e4-4d24-8407-cbde5d0f6466","block_type":"box","text":"For purposes of investment restriction (2) above, with respect to the Fund’s industry classifications, the Fund","page_number":9,"box":{"x":102,"y":150,"width":778,"height":12}},{"id":"633014fb-0a2d-4a7a-821b-80bbc27a2cb7","block_type":"box","text":"currently utilizes any one or more of the industry sub-classifications used by one or more widely recognized market","page_number":9,"box":{"x":69,"y":166,"width":817,"height":11}},{"id":"3d54e19a-1117-4b11-9877-0f448eedf307","block_type":"box","text":"indexes or rating group indexes, and/or as defined by Fund management. The policy also will be interpreted to give","page_number":9,"box":{"x":70,"y":181,"width":817,"height":11}},{"id":"19f07a1a-989f-4192-9e01-e726f2e35be5","block_type":"box","text":"broad authority to the Fund as to how to classify issuers within or among industries.","page_number":9,"box":{"x":69,"y":196,"width":597,"height":11}},{"id":"3424ecea-59eb-429e-8119-f821da90c0eb","block_type":"box","text":"Except with respect to restriction (7) above or with respect to policies adopted pursuant to Rule 35d-1 under the","page_number":9,"box":{"x":102,"y":219,"width":799,"height":11}},{"id":"be682549-2e6a-4871-a3c3-0ca835ab1c53","block_type":"box","text":"Investment Company Act, all limitations under the Fund’s fundamental or non-fundamental investment restrictions","page_number":9,"box":{"x":70,"y":234,"width":810,"height":11}},{"id":"95c4d7c9-c83b-4904-a0ae-638783509188","block_type":"box","text":"apply only at the time that a transaction is undertaken. Any change in the percentage of the Fund’s assets invested","page_number":9,"box":{"x":69,"y":249,"width":824,"height":11}},{"id":"76622149-07f6-4df2-aee5-6b53d7f454d5","block_type":"box","text":"in certain securities or other instruments resulting from market fluctuations or other changes in the Fund’s total","page_number":9,"box":{"x":70,"y":264,"width":797,"height":11}},{"id":"e28db79f-dfb3-4dbb-b656-b7a10345a066","block_type":"box","text":"assets will not require the Fund to dispose of an investment until BlackRock determines that it is practicable to sell","page_number":9,"box":{"x":69,"y":279,"width":823,"height":11}},{"id":"021d039e-afd3-4da3-b3db-c4e142505fa6","block_type":"box","text":"or close out the investment without undue market or tax consequences.","page_number":9,"box":{"x":69,"y":294,"width":511,"height":11}},{"id":"72259144-1f06-4b56-979e-8fed31c7a8ad","block_type":"box","text":"III. Information on Directors and Officers","page_number":9,"box":{"x":69,"y":324,"width":294,"height":9}},{"id":"24151c6d-24df-4a3e-9b8c-5abc51255789","block_type":"box","text":"The Board consists of fifteen individuals (each, a “Director”), thirteen of whom are not “interested persons” of","page_number":9,"box":{"x":101,"y":347,"width":790,"height":11}},{"id":"a6cb5184-ac84-45d3-96fd-41fb9243169e","block_type":"box","text":"the Fund as defined in the Investment Company Act (the “Independent Directors”). The registered investment","page_number":9,"box":{"x":68,"y":362,"width":780,"height":11}},{"id":"f29c4896-34be-4023-9a77-795c610a1c8a","block_type":"box","text":"companies advised by the Manager or its affiliates (the “BlackRock-advised Funds”) are organized into the BlackRock","page_number":9,"box":{"x":69,"y":377,"width":837,"height":12}},{"id":"96cc8185-520a-465a-b1da-8354512e86d7","block_type":"box","text":"Multi-Asset Complex, the BlackRock Fixed-Income Complex, and the iShares Complex (each, a “BlackRock Fund","page_number":9,"box":{"x":70,"y":392,"width":793,"height":11}},{"id":"76170a1c-9b20-486f-a6a9-e3e63bd71de8","block_type":"box","text":"Complex”). The Fund is included in the BlackRock Fund Complex referred to as the BlackRock Multi-Asset Complex.","page_number":9,"box":{"x":69,"y":407,"width":820,"height":11}},{"id":"3fdd34cf-f494-45b3-ace3-e12221175eb1","block_type":"box","text":"The Directors also oversee as board members the operations of the other open-end registered investment companies","page_number":9,"box":{"x":68,"y":423,"width":839,"height":11}},{"id":"d1596659-5621-4e42-ae8e-f398db6f9951","block_type":"box","text":"included in the BlackRock Multi-Asset Complex.","page_number":9,"box":{"x":70,"y":438,"width":335,"height":11}},{"id":"874730aa-74f6-4b16-9d00-56682cf4c088","block_type":"box","text":"The Board has overall responsibility for the oversight of the Fund. The Chair of the Board is an Independent","page_number":9,"box":{"x":101,"y":460,"width":764,"height":12}},{"id":"4ac47a55-4127-4923-82a0-8682f0247aeb","block_type":"box","text":"Director, and the Chair of each Board committee (each, a “Committee”) is an Independent Director. The Board has","page_number":9,"box":{"x":70,"y":475,"width":815,"height":12}},{"id":"b0bafabd-d701-4cd2-ae48-eb3fc18ca36e","block_type":"box","text":"five standing Committees: an Audit Committee, a Governance and Nominating Committee, a Compliance Committee,","page_number":9,"box":{"x":68,"y":491,"width":832,"height":11}},{"id":"13aec7d8-651c-4623-8183-a06674f5537d","block_type":"box","text":"a Performance Oversight Committee and an Ad Hoc Topics Committee. The role of the Chair of the Board is to","page_number":9,"box":{"x":69,"y":506,"width":784,"height":11}},{"id":"10c01790-ab5b-463b-9d8f-9721650c7af8","block_type":"box","text":"preside at all meetings of the Board and to act as a liaison with service providers, officers, attorneys and other","page_number":9,"box":{"x":70,"y":521,"width":793,"height":11}},{"id":"735d5b1a-d0bc-48f3-ac4d-dbcc53244af8","block_type":"box","text":"Directors generally between meetings. The Chair of each Committee performs a similar role with respect to the","page_number":9,"box":{"x":70,"y":536,"width":790,"height":11}},{"id":"22e0648b-628f-4f66-88fe-c3fd2adaccd7","block_type":"box","text":"Committee. The Chair of the Board or the Chair of a Committee may also perform such other functions as may be","page_number":9,"box":{"x":69,"y":551,"width":810,"height":11}},{"id":"c2834034-edaa-4ea6-bf2a-7842767c4173","block_type":"box","text":"delegated by the Board or the Committee from time to time. The Independent Directors meet regularly outside the","page_number":9,"box":{"x":69,"y":566,"width":811,"height":11}},{"id":"59ea74eb-9cf1-41df-96c5-c2ecbe9b24c0","block_type":"box","text":"presence of Fund management, in executive session or with other service providers to the Fund. The Board has","page_number":9,"box":{"x":70,"y":581,"width":794,"height":12}},{"id":"39c87e30-44e4-4aaf-b5e2-a077d4bb7734","block_type":"box","text":"regular meetings five times a year, and may hold special meetings if required before its next regular meeting. Each","page_number":9,"box":{"x":69,"y":596,"width":816,"height":12}},{"id":"03fb9868-43a2-4909-bb84-acd641f61d25","block_type":"box","text":"Committee meets regularly to conduct the oversight functions delegated to that Committee by the Board and reports","page_number":9,"box":{"x":69,"y":612,"width":831,"height":11}},{"id":"421d9be3-d25e-4a79-820e-0c866f0fdf4e","block_type":"box","text":"its findings to the Board. The Board and each standing Committee conduct annual assessments of their oversight","page_number":9,"box":{"x":70,"y":627,"width":811,"height":11}},{"id":"1f052cf0-f58f-4060-bea5-69e52deea64a","block_type":"box","text":"function and structure. The Board has determined that the Board’s leadership structure is appropriate because it","page_number":9,"box":{"x":68,"y":642,"width":809,"height":11}},{"id":"6cacb1d1-733c-4d70-b292-0d2e79f6b64b","block_type":"box","text":"allows the Board to exercise independent judgment over management and to allocate areas of responsibility among","page_number":9,"box":{"x":69,"y":657,"width":825,"height":11}},{"id":"314f7b8e-d422-4d43-abca-b13d0919a464","block_type":"box","text":"Committees and the full Board to enhance effective oversight.","page_number":9,"box":{"x":69,"y":672,"width":441,"height":11}},{"id":"22059013-1cfd-452e-bb22-ea42cdc471a9","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":9,"box":{"x":101,"y":695,"width":777,"height":11}},{"id":"6ca3c2f5-c327-4106-ac68-53d7c6bcb60d","block_type":"box","text":"overseeing the Manager, other service providers, the operations of the Fund and associated risks in accordance with","page_number":9,"box":{"x":69,"y":710,"width":832,"height":11}},{"id":"e31f563b-89bb-46ab-a693-c66b5031d733","block_type":"box","text":"the provisions of the Investment Company Act, state law, other applicable laws, the Fund’s charter, and the Fund’s","page_number":9,"box":{"x":68,"y":725,"width":819,"height":11}},{"id":"0045ecbb-b852-44cf-819d-37db35205980","block_type":"box","text":"investment objective and strategies. The Board reviews, on an ongoing basis, the Fund’s performance, operations","page_number":9,"box":{"x":70,"y":740,"width":812,"height":11}},{"id":"7c71489d-cb04-4ec6-9a08-277aefc06065","block_type":"box","text":"and investment strategies and techniques. The Board also conducts reviews of the Manager and its role in running","page_number":9,"box":{"x":69,"y":755,"width":819,"height":11}},{"id":"287c8e87-5388-44d5-80a9-fe354ea89a33","block_type":"box","text":"the operations of the Fund.","page_number":9,"box":{"x":68,"y":770,"width":192,"height":11}},{"id":"616bebaf-0931-41d9-9698-48f6c1ca7787","block_type":"box","text":"Day-to-day risk management with respect to the Fund is the responsibility of the Manager or of sub-advisers or","page_number":9,"box":{"x":102,"y":793,"width":785,"height":11}},{"id":"0d871668-fb2c-4c09-8b8c-49e7b8d6ee26","block_type":"box","text":"other service providers (depending on the nature of the risk), subject to the supervision of the Manager. The Fund is","page_number":9,"box":{"x":69,"y":808,"width":828,"height":11}},{"id":"f00b3226-4023-431b-8d69-c673802dfae4","block_type":"box","text":"subject to a number of risks, including investment, compliance, operational and valuation risks, among others. While","page_number":9,"box":{"x":69,"y":823,"width":832,"height":12}},{"id":"5d20f484-b387-4a51-bf96-40e18547b85f","block_type":"box","text":"there are a number of risk management functions performed by the Manager and the sub-advisers or other service","page_number":9,"box":{"x":68,"y":838,"width":820,"height":12}},{"id":"23bb66bb-1b28-450e-acd6-51e8a973d655","block_type":"box","text":"providers, as applicable, it is not possible to eliminate all of the risks applicable to the Fund. Risk oversight forms","page_number":9,"box":{"x":70,"y":853,"width":811,"height":12}},{"id":"0e7edb59-4037-4552-981b-5b77198e83fd","block_type":"box","text":"part of the Board’s general oversight of the Fund and is addressed as part of various Board and Committee","page_number":9,"box":{"x":70,"y":869,"width":767,"height":11}},{"id":"ce365d0e-7881-438a-8746-a012cc4b415f","block_type":"box","text":"activities. The Board, directly or through a Committee, also reviews reports from, among others, management, the","page_number":9,"box":{"x":69,"y":884,"width":815,"height":11}},{"id":"9e6a9cc8-0800-4d6c-ab96-4c488703f840","block_type":"box","text":"independent registered public accounting firm for the Fund, sub-advisers and internal auditors for the investment","page_number":9,"box":{"x":70,"y":899,"width":803,"height":11}},{"id":"754d7df3-91f8-4b43-91bf-aaaa2b4adcdf","block_type":"box","text":"I-7","page_number":9,"box":{"x":481,"y":943,"width":16,"height":9}},{"id":"9fbd0a40-dcf2-4ffb-91f3-9f3c8d4b367a","block_type":"box","text":"NM0926U-5977317-9/232","page_number":9,"box":{"x":764,"y":970,"width":141,"height":7}},{"id":"2d3a7311-e7ea-4a4f-8eca-361b550d337c","block_type":"box","text":"adviser or its affiliates, as appropriate, regarding risks faced by the Fund and management’s or the service provider’s","page_number":10,"box":{"x":69,"y":45,"width":840,"height":11}},{"id":"831a8781-12fe-4621-aafd-0bb8ae231b53","block_type":"box","text":"risk functions. The Committee system facilitates the timely and efficient consideration of matters by the Directors,","page_number":10,"box":{"x":69,"y":60,"width":814,"height":11}},{"id":"780dbebd-f744-4e5a-b688-9a6b5d745e71","block_type":"box","text":"and facilitates effective oversight of compliance with legal and regulatory requirements and of the Fund’s activities","page_number":10,"box":{"x":69,"y":75,"width":817,"height":11}},{"id":"44eb8478-d004-42b1-95c0-47a077503794","block_type":"box","text":"and associated risks. The Board has appointed a Chief Compliance Officer, who oversees the implementation and","page_number":10,"box":{"x":69,"y":90,"width":812,"height":11}},{"id":"7df77324-cda4-460f-90b8-4fccc927e14e","block_type":"box","text":"testing of the Fund’s compliance program and reports to the Board regarding compliance matters for the Fund and its","page_number":10,"box":{"x":68,"y":105,"width":840,"height":11}},{"id":"8ccb99f0-ff7c-4d9a-a5ae-255494a8fe32","block_type":"box","text":"service providers. The Independent Directors have engaged independent legal counsel to assist them in performing","page_number":10,"box":{"x":69,"y":120,"width":824,"height":12}},{"id":"7bdd07e6-7d7e-4c92-82cd-e49f7fb5e3af","block_type":"box","text":"their oversight responsibilities.","page_number":10,"box":{"x":68,"y":136,"width":218,"height":11}},{"id":"a915a72e-5b60-4632-92f9-4180d775f99b","block_type":"box","text":"Audit Committee.","page_number":10,"box":{"x":101,"y":158,"width":122,"height":9}},{"id":"6458d762-94d9-4e35-a432-7584d23e42dc","block_type":"box","text":"The members of the Audit Committee (the “Audit Committee”) are Henry R. Keizer (Chair), Neil","page_number":10,"box":{"x":229,"y":158,"width":673,"height":11}},{"id":"c1e4b99c-eff5-433b-98c0-3239428ad5d2","block_type":"box","text":"A. Cotty, Jeffrey Jarczyk, Lori Richards, Kenneth L. Urish and Claire A. Walton, all of whom are Independent Directors.","page_number":10,"box":{"x":68,"y":173,"width":834,"height":11}},{"id":"cbfbd4c8-dff3-4660-8ca7-98f08fda61e3","block_type":"box","text":"The principal responsibilities of the Audit Committee are to approve, and recommend to the full Board for approval,","page_number":10,"box":{"x":68,"y":188,"width":820,"height":11}},{"id":"ab9ca945-4cd3-44fc-a28a-40a8e4c6bfe6","block_type":"box","text":"the selection, retention, termination and compensation of the Fund’s independent registered public accounting firm","page_number":10,"box":{"x":68,"y":203,"width":823,"height":12}},{"id":"dfadd4ee-0151-4d33-beca-71d73dda114b","block_type":"box","text":"(the “Independent Registered Public Accounting Firm”) and to oversee the Independent Registered Public Accounting","page_number":10,"box":{"x":69,"y":219,"width":830,"height":11}},{"id":"5d817383-3d98-411d-b0f3-4048f6925b3b","block_type":"box","text":"Firm’s work. The Audit Committee’s responsibilities include, without limitation, to (1) evaluate the qualifications and","page_number":10,"box":{"x":70,"y":234,"width":825,"height":11}},{"id":"78aa24d4-aeab-46b8-b9f9-6ff08c147d95","block_type":"box","text":"independence of the Independent Registered Public Accounting Firm; (2) approve all audit engagement terms and","page_number":10,"box":{"x":70,"y":249,"width":807,"height":11}},{"id":"eb19ae1f-0a17-4f4f-8414-a3cbab0c83e4","block_type":"box","text":"fees for the Fund; (3) review the conduct and results of each independent audit of the Fund’s annual financial","page_number":10,"box":{"x":68,"y":264,"width":781,"height":11}},{"id":"b9a2324c-651c-41ea-ae82-7f1dd12c5555","block_type":"box","text":"statements; (4) review any issues raised by the Independent Registered Public Accounting Firm or Fund management","page_number":10,"box":{"x":69,"y":279,"width":834,"height":11}},{"id":"03cf3b4a-5e46-4a1b-8e2c-c5d24f45070b","block_type":"box","text":"regarding the accounting or financial reporting policies and practices of the Fund and the internal controls of the Fund","page_number":10,"box":{"x":69,"y":294,"width":838,"height":11}},{"id":"b1f85856-c65c-48dd-9a5a-733adff844d7","block_type":"box","text":"and certain service providers; (5) oversee the performance of the Fund’s Independent Registered Public Accounting","page_number":10,"box":{"x":69,"y":309,"width":825,"height":11}},{"id":"6ad2ba30-9831-4738-bb86-4765f76c7d53","block_type":"box","text":"Firm; (6) review and discuss with management and the Fund’s Independent Registered Public Accounting Firm the","page_number":10,"box":{"x":70,"y":324,"width":809,"height":12}},{"id":"49252951-c998-4dbb-893a-7c586c14f41b","block_type":"box","text":"performance and findings of the Fund’s internal auditors; (7) discuss with Fund management its policies regarding","page_number":10,"box":{"x":70,"y":339,"width":815,"height":12}},{"id":"ab0dd45a-b314-43e0-b715-6d39e9917894","block_type":"box","text":"risk assessment and risk management as such matters relate to the Fund’s financial reporting and controls;","page_number":10,"box":{"x":69,"y":355,"width":774,"height":11}},{"id":"323e8ada-08de-4207-bbab-3f3497f5b533","block_type":"box","text":"(8) resolve any disagreements between Fund management and the Independent Registered Public Accounting Firm","page_number":10,"box":{"x":69,"y":370,"width":815,"height":11}},{"id":"d2187f6f-b045-4343-9191-1b262c687141","block_type":"box","text":"regarding financial reporting; and (9) undertake such other duties and responsibilities as may from time to time be","page_number":10,"box":{"x":69,"y":385,"width":819,"height":11}},{"id":"71196be1-24e8-49f5-ae03-224d7f0c60fb","block_type":"box","text":"delegated by the Board to the Audit Committee. The Board has adopted a written charter for the Audit Committee.","page_number":10,"box":{"x":69,"y":400,"width":812,"height":11}},{"id":"5a9ec88d-0a19-4d59-be8c-4d6ce22406f0","block_type":"box","text":"During the fiscal year ended May 31, 2026, the Audit Committee met four times.","page_number":10,"box":{"x":70,"y":415,"width":574,"height":11}},{"id":"e1c0361b-af45-4560-8e26-bc6b1469e8e1","block_type":"box","text":"Governance and Nominating Committee.","page_number":10,"box":{"x":102,"y":438,"width":286,"height":11}},{"id":"52fa51fa-2664-4b0f-a0cd-7c7781f23a7c","block_type":"box","text":"The members of the Governance and Nominating Committee (the","page_number":10,"box":{"x":394,"y":438,"width":464,"height":11}},{"id":"48fc7e18-7860-4e76-bce5-482fb8cdcdee","block_type":"box","text":"“Governance Committee”) are Cynthia A. Montgomery (Chair), Christopher J. Ailman, Susan J. Carter, Collette Chilton,","page_number":10,"box":{"x":70,"y":453,"width":838,"height":11}},{"id":"7923813c-9050-47d3-a751-5928f09e9b35","block_type":"box","text":"Henry R. Keizer and Marc D. Stern, all of whom are Independent Directors. The principal responsibilities of the","page_number":10,"box":{"x":70,"y":468,"width":786,"height":11}},{"id":"0459ca68-14a6-4885-b783-f8bbb4c30405","block_type":"box","text":"Governance Committee are to (1) identify individuals qualified to serve as Independent Directors of the Fund and","page_number":10,"box":{"x":69,"y":483,"width":804,"height":11}},{"id":"bd3c8d50-3783-4bbb-80b8-f7412442681a","block_type":"box","text":"recommend Independent Director nominees for election by shareholders or appointment by the Board; (2) advise the","page_number":10,"box":{"x":69,"y":498,"width":831,"height":11}},{"id":"838f7ec9-c392-4bf1-a729-9e632886344f","block_type":"box","text":"Board with respect to Board composition, procedures and committees (other than the Audit Committee); (3) oversee","page_number":10,"box":{"x":70,"y":513,"width":828,"height":11}},{"id":"eb3da2ee-a6ae-408c-93fe-0fc6f1bfad81","block_type":"box","text":"periodic self-assessments of the Board and committees of the Board (other than the Audit Committee); (4) review","page_number":10,"box":{"x":70,"y":528,"width":809,"height":11}},{"id":"6c461430-b873-41dd-ae2c-f9f84f425765","block_type":"box","text":"and make recommendations regarding Independent Director compensation; (5) monitor corporate governance","page_number":10,"box":{"x":69,"y":544,"width":780,"height":11}},{"id":"540a176a-d951-4fe2-93ae-7b882808a934","block_type":"box","text":"matters and develop appropriate recommendations to the Board; (6) act as the administrative committee with","page_number":10,"box":{"x":69,"y":559,"width":782,"height":11}},{"id":"4e21b87f-635c-40c3-a3a4-709137cc8276","block_type":"box","text":"respect to Board policies and procedures, committee policies and procedures (other than the Audit Committee) and","page_number":10,"box":{"x":69,"y":574,"width":824,"height":11}},{"id":"a54262b8-d931-4d39-94a9-ce6dc4d4b360","block_type":"box","text":"codes of ethics as they relate to Independent Directors; and (7) undertake such other duties and responsibilities as","page_number":10,"box":{"x":69,"y":589,"width":827,"height":11}},{"id":"57cb11c3-144c-4ece-9a43-a19f9f7ff921","block_type":"box","text":"may from time to time be delegated by the Board to the Governance Committee. The Governance Committee may","page_number":10,"box":{"x":69,"y":604,"width":809,"height":11}},{"id":"265f639e-9a64-469a-a4bf-49f6a6de4674","block_type":"box","text":"consider nominations for Directors made by the Fund’s shareholders as it deems appropriate. Under the Fund’s","page_number":10,"box":{"x":69,"y":619,"width":796,"height":11}},{"id":"cc1f125f-903f-42ea-9f65-4c8b56709bbf","block_type":"box","text":"Amended and Restated Bylaws, shareholders must follow certain procedures to nominate a person for election as a","page_number":10,"box":{"x":68,"y":634,"width":828,"height":11}},{"id":"acb81489-9d0c-47e7-b036-5b3dabdc5180","block_type":"box","text":"Director at a shareholder meeting at which Directors are to be elected. Under these advance notice procedures,","page_number":10,"box":{"x":70,"y":650,"width":795,"height":11}},{"id":"ef4e4e28-9392-4d4a-b46c-fcdc5e53dfb5","block_type":"box","text":"notice of the proposed nominee to the Secretary of the Fund must be delivered to or mailed and received at the","page_number":10,"box":{"x":69,"y":664,"width":797,"height":12}},{"id":"67aba1b3-d642-4143-adc1-869affc7993e","block_type":"box","text":"principal executive offices of the Fund not later than the close of business on the fifth day following the day on which","page_number":10,"box":{"x":70,"y":680,"width":831,"height":11}},{"id":"f8e79a86-39cc-4169-93e7-8eaf4612d68c","block_type":"box","text":"notice of the date of the meeting was mailed or public disclosure of the date of the meeting was made, whichever","page_number":10,"box":{"x":69,"y":695,"width":812,"height":11}},{"id":"3da4231c-33a1-4814-bb4e-06b77d031916","block_type":"box","text":"first occurs. The Fund’s Bylaws provide that notice of a proposed nomination must include certain information about","page_number":10,"box":{"x":68,"y":710,"width":830,"height":11}},{"id":"caf10dca-27d6-41f1-84bd-ebb4e2c0ebd8","block_type":"box","text":"the shareholder and the nominee, as well as certain other information, including a written consent of the proposed","page_number":10,"box":{"x":68,"y":725,"width":820,"height":11}},{"id":"8fca7db9-f721-489b-a6eb-a08d2cb71767","block_type":"box","text":"nominee to serve if elected. Reference is made to the Fund’s Bylaws for more details. The Board has adopted a","page_number":10,"box":{"x":69,"y":740,"width":799,"height":11}},{"id":"9c60103d-45d7-4d9a-8721-36afa5ee98bd","block_type":"box","text":"written charter for the Governance Committee. During the fiscal year ended May 31, 2026, the Governance","page_number":10,"box":{"x":68,"y":755,"width":765,"height":11}},{"id":"b62e0fdb-54ac-4130-a946-6fe097c8cddd","block_type":"box","text":"Committee met ten times.","page_number":10,"box":{"x":69,"y":770,"width":185,"height":9}},{"id":"01631bec-d868-4cfb-8178-934f5b0b6e8f","block_type":"box","text":"Compliance Committee.","page_number":10,"box":{"x":102,"y":793,"width":168,"height":11}},{"id":"bdb9ea24-05a0-4754-9630-533a18317bce","block_type":"box","text":"The members of the Compliance Committee (the “Compliance Committee”) are Claire A.","page_number":10,"box":{"x":276,"y":793,"width":629,"height":11}},{"id":"20b271a7-4094-4300-900e-a6c296720376","block_type":"box","text":"Walton (Chair), Jeffrey Jarczyk, Cynthia A. Montgomery, Donald C. Opatrny, Lori Richards and Kenneth L. Urish, all of","page_number":10,"box":{"x":68,"y":808,"width":828,"height":11}},{"id":"ea1ce640-3d23-4c29-b2c1-3049e762078d","block_type":"box","text":"whom are Independent Directors. The Compliance Committee’s purpose is to assist the Board in fulfilling its","page_number":10,"box":{"x":68,"y":823,"width":773,"height":12}},{"id":"d232fd24-22d3-48d6-af05-030870600378","block_type":"box","text":"responsibility to oversee regulatory and fiduciary compliance matters involving the Fund, the fund-related activities of","page_number":10,"box":{"x":69,"y":838,"width":834,"height":12}},{"id":"1a8040f6-8858-41d1-abcc-1f320a0e55ed","block_type":"box","text":"BlackRock and any sub-adviser and the Fund’s third-party service providers. The Compliance Committee’s","page_number":10,"box":{"x":70,"y":854,"width":753,"height":11}},{"id":"54ff2c67-6ecf-4509-8458-3ca23895b3a3","block_type":"box","text":"responsibilities include, without limitation, to (1) oversee the compliance policies and procedures of the Fund and its","page_number":10,"box":{"x":69,"y":869,"width":832,"height":11}},{"id":"ba00c5a5-0c8f-45e8-aa08-13f91cc70c97","block_type":"box","text":"service providers and recommend changes or additions to such policies and procedures; (2) review information on","page_number":10,"box":{"x":69,"y":884,"width":815,"height":11}},{"id":"a4ecbc2e-c585-4040-b1de-f74f85936c7c","block_type":"box","text":"and, where appropriate, recommend policies concerning the Fund’s compliance with applicable law; (3) review","page_number":10,"box":{"x":69,"y":899,"width":784,"height":11}},{"id":"31656e43-ced1-4fef-9cc2-7e52a8186cb8","block_type":"box","text":"I-8","page_number":10,"box":{"x":481,"y":943,"width":17,"height":9}},{"id":"7ca392cf-7f0d-44fc-8d4b-b8963a064eca","block_type":"box","text":"NM0926U-5977317-10/232","page_number":10,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"e4c68bf6-21cb-44b7-beef-6139dc99c03d","block_type":"box","text":"reports from, oversee the annual performance review of, and make certain recommendations and determinations","page_number":11,"box":{"x":69,"y":45,"width":811,"height":11}},{"id":"35c95af1-4fca-45da-94a4-5d630a2b2d32","block_type":"box","text":"regarding the Fund’s Chief Compliance Officer (the “CCO”), including determining the amount and structure of the","page_number":11,"box":{"x":69,"y":60,"width":811,"height":11}},{"id":"dec00437-481b-4cc1-bcfa-0b8d90a50dc2","block_type":"box","text":"CCO’s compensation and recommending such amount and structure to the full Board for approval and ratification;","page_number":11,"box":{"x":69,"y":75,"width":812,"height":11}},{"id":"ac4fd657-8ceb-4e34-8523-89f82de3f2e1","block_type":"box","text":"and (4) undertake such other duties and responsibilities as may from time to time be delegated by the Board to the","page_number":11,"box":{"x":69,"y":90,"width":825,"height":11}},{"id":"67c0830d-3205-4f51-a70c-b79b404feb04","block_type":"box","text":"Compliance Committee. The Board has adopted a written charter for the Compliance Committee. During the fiscal","page_number":11,"box":{"x":69,"y":105,"width":811,"height":11}},{"id":"4df51008-aed5-4869-b70d-d61858ae9a27","block_type":"box","text":"year ended May 31, 2026, the Compliance Committee met four times.","page_number":11,"box":{"x":68,"y":120,"width":502,"height":11}},{"id":"90f7432b-80d1-4086-a2ee-ac2ca03307ab","block_type":"box","text":"Per formance Oversight Committee.","page_number":11,"box":{"x":102,"y":143,"width":248,"height":11}},{"id":"4a6b6dde-cbba-4996-9e80-f92d33bc5d0c","block_type":"box","text":"The members of the Performance Oversight Committee (the “Performance","page_number":11,"box":{"x":356,"y":143,"width":531,"height":11}},{"id":"b61740b9-9706-461b-b96f-80f889129e9d","block_type":"box","text":"Oversight Committee”) are Donald C. Opatrny (Chair), Christopher J. Ailman, Susan J. Carter, Collette Chilton, Neil A.","page_number":11,"box":{"x":69,"y":158,"width":829,"height":11}},{"id":"9dc3dca1-8ac3-4146-a880-63caab730a66","block_type":"box","text":"Cotty and Marc D. Stern, all of whom are Independent Directors. The Performance Oversight Committee’s purpose is","page_number":11,"box":{"x":69,"y":173,"width":832,"height":11}},{"id":"5ca71136-bf30-4f14-8961-fcdab443f39f","block_type":"box","text":"to assist the Board in fulfilling its responsibility to oversee the Fund’s investment performance relative to its agreed","page_number":11,"box":{"x":68,"y":188,"width":832,"height":12}},{"id":"ad4c9cce-a45e-4061-9b23-cd007e77102c","block_type":"box","text":"upon performance objectives and to assist the Independent Directors in their consideration of investment advisory","page_number":11,"box":{"x":69,"y":203,"width":818,"height":12}},{"id":"7d30a782-6358-414e-9863-324ad4636879","block_type":"box","text":"agreements. The Performance Oversight Committee’s responsibilities include, without limitation, to (1) review","page_number":11,"box":{"x":69,"y":218,"width":782,"height":12}},{"id":"7b01bbe8-4de2-4383-a4f6-609723693d41","block_type":"box","text":"information on, and make recommendations to the full Board in respect of, the Fund’s investment objective, policies","page_number":11,"box":{"x":70,"y":234,"width":829,"height":11}},{"id":"e93114d5-b399-4bc1-85b8-17d8214f78cc","block_type":"box","text":"and practices; (2) review information on the Fund’s investment performance; (3) review information on appropriate","page_number":11,"box":{"x":69,"y":249,"width":816,"height":11}},{"id":"a0a0000e-a024-4a5a-bce3-a7f7d2a666ef","block_type":"box","text":"benchmarks and competitive universes and unusual or exceptional investment matters; (4) review personnel and","page_number":11,"box":{"x":69,"y":264,"width":803,"height":11}},{"id":"60fe4b0e-4403-44be-98a2-16a0382ba93d","block_type":"box","text":"other resources devoted to management of the Fund and evaluate the nature and quality of information furnished to","page_number":11,"box":{"x":69,"y":279,"width":827,"height":11}},{"id":"d682efbc-6774-4a0d-a7d8-a0794a8d7763","block_type":"box","text":"the Performance Oversight Committee; (5) recommend any required action regarding changes in fundamental and","page_number":11,"box":{"x":68,"y":294,"width":811,"height":11}},{"id":"7ef13095-284f-40dd-9a5e-95db48e32f3c","block_type":"box","text":"non-fundamental investment policies and restrictions, fund mergers or liquidations; (6) request and review","page_number":11,"box":{"x":69,"y":309,"width":757,"height":11}},{"id":"ca196d7f-e147-44d6-aeed-d0dbac9555d1","block_type":"box","text":"information on the nature, extent and quality of services provided to the shareholders; (7) make recommendations to","page_number":11,"box":{"x":70,"y":324,"width":835,"height":11}},{"id":"24bd6dbc-f787-45e3-8a96-b7b9595ced5d","block_type":"box","text":"the Board concerning the approval or renewal of investment advisory agreements; and (8) undertake such other","page_number":11,"box":{"x":68,"y":339,"width":800,"height":12}},{"id":"c245b747-2aaf-431e-b0a1-7eb2f0875c0f","block_type":"box","text":"duties and responsibilities as may from time to time be delegated by the Board to the Performance Oversight","page_number":11,"box":{"x":69,"y":355,"width":780,"height":11}},{"id":"43beeff6-2d81-4fe4-80ef-519d76ef516d","block_type":"box","text":"Committee. The Board has adopted a written charter for the Performance Oversight Committee. During the fiscal year","page_number":11,"box":{"x":69,"y":370,"width":838,"height":11}},{"id":"bbd5bdb1-7062-4caa-bde6-da84ba7d0cc7","block_type":"box","text":"ended May 31, 2026, the Performance Oversight Committee met five times.","page_number":11,"box":{"x":69,"y":385,"width":544,"height":11}},{"id":"182a93f4-4e8c-4113-8d73-87d5878430dd","block_type":"box","text":"Ad Hoc Topics Committee.","page_number":11,"box":{"x":101,"y":408,"width":186,"height":10}},{"id":"2e2b2370-6e84-446d-a53d-ee4a8db0f0fe","block_type":"box","text":"The members of the Ad Hoc Topics Committee (the “Ad Hoc Topics Committee”) are","page_number":11,"box":{"x":293,"y":407,"width":598,"height":11}},{"id":"ba9be534-e687-45dd-85a4-ebfecb3efae5","block_type":"box","text":"Mark Stalnecker (Chair) and Claire A. Walton, both of whom are Independent Directors, and John M. Perlowski, who","page_number":11,"box":{"x":70,"y":423,"width":819,"height":11}},{"id":"e04cd46f-d60d-4c64-bad9-595d596ff977","block_type":"box","text":"serves as an interested Director. The principal responsibilities of the Ad Hoc Topics Committee are to (1) act on","page_number":11,"box":{"x":69,"y":438,"width":796,"height":11}},{"id":"c20e4032-f459-4893-b2fd-25ff2b78b0a3","block_type":"box","text":"routine matters between meetings of the Board; (2) act on such matters as may require urgent action between","page_number":11,"box":{"x":69,"y":453,"width":788,"height":11}},{"id":"7ac17e0e-0880-4143-8b48-7b21d7c57c4f","block_type":"box","text":"meetings of the Board; and (3) exercise such other authority as may from time to time be delegated to the Ad Hoc","page_number":11,"box":{"x":69,"y":468,"width":813,"height":11}},{"id":"f8fbea6e-d899-4449-b046-d947962bf982","block_type":"box","text":"Topics Committee by the Board. The Board has adopted a written charter for the Ad Hoc Topics Committee. During","page_number":11,"box":{"x":68,"y":483,"width":816,"height":11}},{"id":"8f60c734-e1bb-4534-84f0-a9d441a3d034","block_type":"box","text":"the fiscal year ended May 31, 2026, the Ad Hoc Topics Committee did not meet.","page_number":11,"box":{"x":68,"y":498,"width":575,"height":11}},{"id":"9aaaabf3-85e7-423e-84d1-fd6111ff788e","block_type":"box","text":"The Governance Committee has adopted a statement of policy that describes the experience, qualifications,","page_number":11,"box":{"x":101,"y":521,"width":771,"height":11}},{"id":"42938b93-e8fa-4aec-aa8b-8d524a62499d","block_type":"box","text":"skills and attributes that are necessary and desirable for potential Independent Director candidates (the “Statement","page_number":11,"box":{"x":69,"y":536,"width":830,"height":11}},{"id":"e4bf60ad-1309-488a-ae1a-7e3a3713b6e9","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":11,"box":{"x":69,"y":551,"width":833,"height":11}},{"id":"e316928f-8523-4936-bd92-1502fd1e34a5","block_type":"box","text":"appointed a Director, and continues to satisfy, the standards contemplated by the Statement of Policy. Furthermore,","page_number":11,"box":{"x":69,"y":566,"width":827,"height":11}},{"id":"908f5603-e902-45f5-8444-eabc5412f304","block_type":"box","text":"in determining that a particular Independent Director was and continues to be qualified to serve as a Director, the","page_number":11,"box":{"x":70,"y":581,"width":811,"height":12}},{"id":"836be098-70d4-43f3-bdcf-7fb6ac5ca1e9","block_type":"box","text":"Board has considered a variety of criteria, none of which, in isolation, was controlling. The Board believes that,","page_number":11,"box":{"x":70,"y":596,"width":787,"height":12}},{"id":"f81d227f-b07c-45e4-8e42-905a81aa044d","block_type":"box","text":"collectively, the Independent Directors have balanced and diverse experience, skills, attributes and qualifications,","page_number":11,"box":{"x":69,"y":612,"width":807,"height":11}},{"id":"ad537eae-be48-49ce-8368-0d1290889dd0","block_type":"box","text":"which allow the Board to operate effectively in governing the Fund and protecting the interests of shareholders.","page_number":11,"box":{"x":68,"y":627,"width":792,"height":11}},{"id":"20362851-7dc9-4275-9559-2b7e6f611937","block_type":"box","text":"Among the attributes common to all Independent Directors are their ability to review critically, evaluate, question and","page_number":11,"box":{"x":68,"y":642,"width":832,"height":11}},{"id":"32e2f889-436f-4aac-91cb-627a29ae8067","block_type":"box","text":"discuss information provided to them, to interact effectively with the Fund’s investment adviser, sub-advisers, other","page_number":11,"box":{"x":69,"y":657,"width":823,"height":11}},{"id":"71619c53-7870-4b2c-8359-e7d5aa6576c5","block_type":"box","text":"service providers, counsel and the Independent Registered Public Accounting Firm, and to exercise effective","page_number":11,"box":{"x":69,"y":672,"width":771,"height":11}},{"id":"c11b8836-2948-4f94-b91d-661f7bad2dae","block_type":"box","text":"business judgment in the performance of their duties as Directors.","page_number":11,"box":{"x":69,"y":687,"width":475,"height":11}},{"id":"63202afd-d803-4db3-9c13-01692aaf3eb8","block_type":"box","text":"Each Director’s ability to perform his or her duties effectively is evidenced by his or her educational background","page_number":11,"box":{"x":102,"y":710,"width":794,"height":11}},{"id":"d11c7e22-a97e-4c89-9fe8-ef4022f823d3","block_type":"box","text":"or professional training; business, consulting, public service or academic positions; experience from service as a","page_number":11,"box":{"x":69,"y":725,"width":807,"height":11}},{"id":"3b8c132d-b828-4a6e-b51b-53ce96dec821","block_type":"box","text":"board member of the Fund and the other funds in the BlackRock Fund Complexes (and any predecessor funds), other","page_number":11,"box":{"x":69,"y":740,"width":835,"height":11}},{"id":"ddb6521e-fe94-46c1-92ba-7b041b827b97","block_type":"box","text":"investment funds, public companies, non-profit entities or other organizations; ongoing commitment to and","page_number":11,"box":{"x":70,"y":755,"width":759,"height":11}},{"id":"49ee05e6-80ad-4fce-a1bb-76b1a7ffe7e0","block_type":"box","text":"participation in Board and Committee meetings, as well as his or her leadership of standing and","page_number":11,"box":{"x":70,"y":770,"width":685,"height":12}},{"id":"5293a57e-81a3-4c0b-aa81-9e3170ffc36a","block_type":"box","text":"ad hoc","page_number":11,"box":{"x":762,"y":771,"width":47,"height":8}},{"id":"d93c016c-7aa9-4e98-8fbb-c8e03a37b341","block_type":"box","text":"committees","page_number":11,"box":{"x":814,"y":771,"width":82,"height":8}},{"id":"86f1f7fb-3625-4f1d-acb2-d9902443ffb5","block_type":"box","text":"throughout the years; or other relevant life experiences.","page_number":11,"box":{"x":68,"y":785,"width":395,"height":12}},{"id":"aae9cfaf-6731-4b52-8bde-fce972d8fa38","block_type":"box","text":"I-9","page_number":11,"box":{"x":481,"y":943,"width":17,"height":9}},{"id":"ffc86a86-4da5-4212-8bb5-912e76acf7d4","block_type":"box","text":"NM0926U-5977317-11/232","page_number":11,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"6bcd371e-7ed9-4050-bcc1-e8195335f17a","block_type":"box","text":"The table below discusses some of the experiences, qualifications and skills of each of the Directors that","page_number":12,"box":{"x":101,"y":45,"width":754,"height":11}},{"id":"ff510af8-6517-48c8-85cb-874ea835d123","block_type":"box","text":"support the conclusion that each Director should serve on the Board.","page_number":12,"box":{"x":69,"y":60,"width":494,"height":11}},{"id":"e582417c-8c29-4688-ab2e-86609e237ee8","block_type":"box","text":"Directors Experience, Qualifications and Skills","page_number":12,"box":{"x":69,"y":88,"width":408,"height":9}},{"id":"91797896-4e90-4074-bb80-e472b7d856c4","block_type":"box","text":"Independent Directors","page_number":12,"box":{"x":70,"y":105,"width":156,"height":10}},{"id":"2312d475-9bce-4618-bc03-9e9093d8ca7e","block_type":"box","text":"Christopher J. Ailman Christopher Ailman has more than 30 years of experience in the financial services","page_number":12,"box":{"x":69,"y":120,"width":781,"height":11}},{"id":"64d9dca0-9847-489b-a1dd-d0e0d1ef4686","block_type":"box","text":"industry, including most recently serving as Chief Investment Officer of the California","page_number":12,"box":{"x":265,"y":135,"width":604,"height":11}},{"id":"2f5aaeca-c811-45bc-94bf-85eec3a99884","block_type":"box","text":"State Teachers Retirement System (CalSTRS) from 2000 to June 2024 where he led its","page_number":12,"box":{"x":265,"y":150,"width":623,"height":11}},{"id":"3f3a6215-29ab-4793-a4d1-301d605f631c","block_type":"box","text":"investment program. Mr. Ailman currently is a principal at Ailman Advisers. In addition, he","page_number":12,"box":{"x":265,"y":165,"width":637,"height":11}},{"id":"3a16eb2d-c850-4214-8a30-b25e2edaa927","block_type":"box","text":"has held various roles in the industry, including as member and chair of the asset owner","page_number":12,"box":{"x":265,"y":180,"width":631,"height":11}},{"id":"4fdc4c83-20d0-48eb-9a14-96c75344a0a3","block_type":"box","text":"committee of the Kroner Center for Financial Research, chairman of the North American","page_number":12,"box":{"x":264,"y":195,"width":626,"height":11}},{"id":"96d98ace-6b3a-4409-a969-2822d41e1ce6","block_type":"box","text":"Chapter of the 300 Club of Global CIOs, and co-chair of the Milken Global Capital Markets","page_number":12,"box":{"x":265,"y":210,"width":639,"height":11}},{"id":"5af59d73-1dc3-4724-9974-35748ec04f83","block_type":"box","text":"Advisory Council. These positions have provided Mr. Ailman with considerable investment","page_number":12,"box":{"x":264,"y":226,"width":637,"height":11}},{"id":"c062b3ff-bd7e-4ab8-872a-7abf5a92e777","block_type":"box","text":"expertise across asset classes and strategies, and insight and perspective on the","page_number":12,"box":{"x":265,"y":241,"width":586,"height":11}},{"id":"f0f60fbc-27c4-4410-bdf8-271cd60e452e","block_type":"box","text":"markets and the economy. In addition, Mr. Ailman serves as a member of the Governance","page_number":12,"box":{"x":265,"y":256,"width":640,"height":11}},{"id":"b4d93029-50f4-445e-8725-3664dfa1cbd2","block_type":"box","text":"Committee and the Performance Oversight Committee.","page_number":12,"box":{"x":265,"y":271,"width":389,"height":11}},{"id":"fb7b6bdb-800b-416f-bffd-ffc93567243a","block_type":"box","text":"Susan J. Carter Susan J. Carter has over 35 years of experience in investment management. She has","page_number":12,"box":{"x":69,"y":293,"width":806,"height":12}},{"id":"ffaaf3d0-10f3-4544-a0f1-6f963a4135d5","block_type":"box","text":"served as President & Chief Executive Officer of Commonfund Capital, Inc. (“CCI”), a","page_number":12,"box":{"x":265,"y":309,"width":604,"height":11}},{"id":"c204e2e2-474b-45b6-9ea9-e8fa57bcbdf8","block_type":"box","text":"registered investment adviser focused on non-profit investors, from 1997 to 2013, Chief","page_number":12,"box":{"x":265,"y":324,"width":632,"height":11}},{"id":"35e34d61-c723-431e-a6a1-9da5cc8ef3b8","block_type":"box","text":"Executive Officer of CCI from 2013 to 2014 and Senior Advisor to CCI in 2015.","page_number":12,"box":{"x":265,"y":339,"width":562,"height":9}},{"id":"43f8a6b0-dfd4-44f3-b7a2-467ece3cca61","block_type":"box","text":"Ms. Carter also served as director of the Pacific Pension Institute from 2014 to 2018,","page_number":12,"box":{"x":265,"y":354,"width":616,"height":10}},{"id":"a344fada-9072-4e05-9471-fd39bcf76cf8","block_type":"box","text":"trustee to the Financial Accounting Foundation from 2017 to 2021, Advisory Board","page_number":12,"box":{"x":264,"y":369,"width":591,"height":11}},{"id":"1d6172de-2eba-4807-884c-4f75db7e169b","block_type":"box","text":"Member for the Center for Private Equity and Entrepreneurship at Tuck School of Business","page_number":12,"box":{"x":265,"y":384,"width":641,"height":11}},{"id":"d600ac5d-5d9d-4128-861a-7d3e16ad2283","block_type":"box","text":"from 1997 to 2021, Advisory Board Member for Bridges Fund Management from 2016 to","page_number":12,"box":{"x":264,"y":399,"width":638,"height":12}},{"id":"8dfc4177-496b-4c70-96d3-12b3cbd8af53","block_type":"box","text":"2018, Advisory Board Member for Girls Who Invest from 2015 to 2018 and Board","page_number":12,"box":{"x":265,"y":414,"width":584,"height":12}},{"id":"d818e044-be40-466c-b558-ff7807790bfd","block_type":"box","text":"Member thereof from 2018 to 2022, and Practitioner Advisory Board Member for Private","page_number":12,"box":{"x":265,"y":429,"width":630,"height":12}},{"id":"001e30d3-708a-4a12-b902-b65251b13fc8","block_type":"box","text":"Capital Research Institute (“PCRI”) from 2017 to 2024. She currently serves as Member","page_number":12,"box":{"x":265,"y":445,"width":634,"height":11}},{"id":"9b50533c-d2bb-4a82-b234-a2cba20dfdd0","block_type":"box","text":"of the President’s Counsel for Commonfund. These positions have provided her with","page_number":12,"box":{"x":265,"y":460,"width":599,"height":11}},{"id":"ccb310f8-0d02-44a2-910a-fcd6ad670c69","block_type":"box","text":"insight and perspective on the markets and the economy.","page_number":12,"box":{"x":265,"y":475,"width":407,"height":11}},{"id":"e3aecbc7-3520-4a16-a1cf-f92e1b5ee188","block_type":"box","text":"Collette Chilton Collette Chilton has over 20 years of experience in investment management. She held the","page_number":12,"box":{"x":69,"y":498,"width":837,"height":11}},{"id":"d73e11ec-40a0-4dd8-9467-2a83943e58e9","block_type":"box","text":"position of Chief Investment Officer of Williams College from October 2006 to June 2023.","page_number":12,"box":{"x":265,"y":513,"width":638,"height":11}},{"id":"ac56fd45-1ea0-49bf-b091-2b88e42f4c51","block_type":"box","text":"Prior to that she was President and Chief Investment Officer of Lucent Asset Management","page_number":12,"box":{"x":265,"y":528,"width":642,"height":11}},{"id":"a2da26b1-65da-475f-aa21-6fe3a4b486f2","block_type":"box","text":"Corporation, where she oversaw approximately $40 billion in pension and retirement","page_number":12,"box":{"x":265,"y":542,"width":601,"height":12}},{"id":"4bcb064c-1850-4266-9d71-36d0eaec457b","block_type":"box","text":"savings assets for the company. These positions have provided her with insight and","page_number":12,"box":{"x":265,"y":558,"width":595,"height":11}},{"id":"ca70e250-6c6d-420c-8be0-a63c4af9ae6c","block_type":"box","text":"perspective on the markets and the economy.","page_number":12,"box":{"x":265,"y":573,"width":323,"height":11}},{"id":"3f75eebb-9503-42b0-bb25-d1c34c73ece8","block_type":"box","text":"Neil A. Cotty Neil A. Cotty has more than 30 years of experience in the financial services industry,","page_number":12,"box":{"x":70,"y":596,"width":798,"height":11}},{"id":"4eebf375-dbed-46f3-bff5-7e30ce90c636","block_type":"box","text":"including 19 years at Bank of America Corporation and its affiliates, where he served, at","page_number":12,"box":{"x":265,"y":611,"width":631,"height":11}},{"id":"72450bdd-e567-4adc-94d1-92df1fb0e3e7","block_type":"box","text":"different times, as the Chief Financial Officer of various businesses including Investment","page_number":12,"box":{"x":265,"y":626,"width":633,"height":11}},{"id":"4a316a55-5e18-4ff6-95b8-578391c44e16","block_type":"box","text":"Banking, Global Markets, Wealth Management and Consumer and also served ten years","page_number":12,"box":{"x":265,"y":641,"width":628,"height":11}},{"id":"571d87ef-a155-4d1d-b664-c1cd712fae56","block_type":"box","text":"as the Chief Accounting Officer for Bank of America Corporation. Mr. Cotty has been","page_number":12,"box":{"x":265,"y":656,"width":596,"height":12}},{"id":"cdf929a8-af63-45aa-9a69-085b163d5ef0","block_type":"box","text":"determined by the Audit Committee to be an audit committee financial expert, as such","page_number":12,"box":{"x":265,"y":671,"width":616,"height":12}},{"id":"f2e83d31-074d-4e9a-a636-a608f0a6b01c","block_type":"box","text":"term is defined in the applicable Commission rules.","page_number":12,"box":{"x":264,"y":686,"width":368,"height":11}},{"id":"ab60d716-7d04-4f0b-82f7-d1231981ee6a","block_type":"box","text":"Jeffrey Jarczyk Jeffrey Jarczyk is a CPA and has more than 30 years of experience in the financial","page_number":12,"box":{"x":69,"y":709,"width":777,"height":11}},{"id":"8a1ec419-86da-432d-8784-ae348cee5c65","block_type":"box","text":"services industry, including over 19 years at Fidelity Investments, where he served, at","page_number":12,"box":{"x":265,"y":724,"width":613,"height":12}},{"id":"50b2edde-b067-40b6-89ee-a183061c6d30","block_type":"box","text":"different times, as the Chief Auditor and the Chief Accounting Officer of Fidelity","page_number":12,"box":{"x":265,"y":739,"width":563,"height":12}},{"id":"8690c7a0-7b4c-459b-9c87-ca50be8a0635","block_type":"box","text":"Investments’ parent company, FMR LLC. Prior to working at Fidelity, Mr. Jarczyk was a","page_number":12,"box":{"x":265,"y":755,"width":607,"height":11}},{"id":"f9574f5f-b18d-4f9c-b140-745e86855e59","block_type":"box","text":"partner at Deloitte and Arthur Andersen for approximately 17 years. These positions have","page_number":12,"box":{"x":265,"y":770,"width":638,"height":11}},{"id":"b02dd965-a1db-4b19-b0a9-2fe561a1b319","block_type":"box","text":"allowed him to work extensively with audit and risk committees and company executives","page_number":12,"box":{"x":265,"y":785,"width":626,"height":11}},{"id":"34ba90c5-17f2-4718-9ede-443cf18eaa43","block_type":"box","text":"helping to identify, manage and mitigate risks for financial services companies.","page_number":12,"box":{"x":265,"y":800,"width":563,"height":11}},{"id":"ee352123-3587-4e88-9d35-9b89a2d4cdea","block_type":"box","text":"Mr. Jarczyk also served as consultant to the Independent Directors prior to becoming an","page_number":12,"box":{"x":265,"y":815,"width":627,"height":11}},{"id":"a33e9949-da45-4dd2-b766-99fe3e630c5d","block_type":"box","text":"Independent Director. Mr. Jarczyk has been determined by the Audit Committee to be an","page_number":12,"box":{"x":265,"y":830,"width":627,"height":11}},{"id":"508e4304-57f3-44ed-96a6-fa0f7aed65f8","block_type":"box","text":"audit committee financial expert, as such term is defined in the applicable Commission","page_number":12,"box":{"x":265,"y":845,"width":623,"height":11}},{"id":"f346aa15-38f4-48c1-809e-0edd46e2aca1","block_type":"box","text":"rules.","page_number":12,"box":{"x":265,"y":861,"width":38,"height":8}},{"id":"2a5c8913-fb02-402e-8dcd-4ff94e010dc1","block_type":"box","text":"I-10","page_number":12,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"19dca0ec-2829-4831-bce1-050d6669f59c","block_type":"box","text":"NM0926U-5977317-12/232","page_number":12,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"062c5e20-59e1-4dd0-b602-e295b66bf878","block_type":"box","text":"Directors Experience, Qualifications and Skills","page_number":13,"box":{"x":69,"y":49,"width":408,"height":9}},{"id":"28a71702-5547-4f96-b0e8-d930743fe229","block_type":"box","text":"Henry R. Keizer Henry R. Keizer brings over 40 years of executive, financial, operational, strategic and","page_number":13,"box":{"x":70,"y":65,"width":806,"height":12}},{"id":"61397049-d80e-47ce-b548-34c2a57da044","block_type":"box","text":"global expertise gained through his 35 year career at KPMG, a global professional","page_number":13,"box":{"x":264,"y":81,"width":584,"height":11}},{"id":"631319ed-ebe9-40b6-9048-25db3070baa1","block_type":"box","text":"services organization and by his service as a director to both publicly and privately held","page_number":13,"box":{"x":265,"y":96,"width":622,"height":11}},{"id":"01fbc29c-d424-4f32-a1f2-6f9bb741165f","block_type":"box","text":"organizations. He has extensive experience with issues facing complex, global companies","page_number":13,"box":{"x":265,"y":111,"width":638,"height":11}},{"id":"a4fbdb4d-16e1-4b21-8682-99f076bfe387","block_type":"box","text":"and expertise in financial reporting, accounting, auditing, risk management, and","page_number":13,"box":{"x":265,"y":126,"width":570,"height":11}},{"id":"b7dd5865-4c0f-4182-9216-3224af504ecd","block_type":"box","text":"regulatory affairs for such companies. Mr. Keizer’s experience also includes service as an","page_number":13,"box":{"x":265,"y":141,"width":642,"height":11}},{"id":"578f0815-fe61-4064-971c-31f9179eb007","block_type":"box","text":"audit committee chair to both publicly and privately held organizations across numerous","page_number":13,"box":{"x":265,"y":156,"width":626,"height":11}},{"id":"15215b1b-a580-4251-986c-8a67ca05888c","block_type":"box","text":"industries including professional services, property and casualty reinsurance, insurance,","page_number":13,"box":{"x":265,"y":171,"width":630,"height":12}},{"id":"3bee6b96-e1c6-486f-99d2-d755e5dd8456","block_type":"box","text":"diversified financial services, banking, direct to consumer, business to business and","page_number":13,"box":{"x":265,"y":186,"width":602,"height":12}},{"id":"fd337e5f-b112-47ef-b58b-e5f0c6a6aa68","block_type":"box","text":"technology. Mr. Keizer is a certified public accountant and also served on the board of the","page_number":13,"box":{"x":264,"y":201,"width":643,"height":12}},{"id":"b2777565-19c7-465c-a33a-808bd44e2f46","block_type":"box","text":"American Institute of Certified Public Accountants. Mr. Keizer has been determined by the","page_number":13,"box":{"x":264,"y":217,"width":639,"height":11}},{"id":"ffd6f7bc-7a4b-477d-bc2f-54aeab6a216e","block_type":"box","text":"Audit Committee to be an audit committee financial expert, as such term is defined in the","page_number":13,"box":{"x":264,"y":232,"width":641,"height":11}},{"id":"3202cc8f-ec6f-4bc8-a7f0-96cbcc223a88","block_type":"box","text":"applicable Commission rules.","page_number":13,"box":{"x":265,"y":247,"width":208,"height":11}},{"id":"91fc25e4-b43f-4bc8-a13f-257bed4551fb","block_type":"box","text":"Cynthia A. Montgomery Cynthia A. Montgomery has served for over 20 years on the boards of registered","page_number":13,"box":{"x":69,"y":269,"width":769,"height":12}},{"id":"a77db77c-eef6-4fa8-8810-58325cc05270","block_type":"box","text":"investment companies, most recently as a member of the boards of certain BlackRock","page_number":13,"box":{"x":265,"y":285,"width":621,"height":11}},{"id":"d4b08181-296e-4217-845a-8de66d898e82","block_type":"box","text":"advised Funds and predecessor funds, including the legacy Merrill Lynch Investment","page_number":13,"box":{"x":265,"y":300,"width":599,"height":11}},{"id":"a1ebb581-29f9-4c1c-b679-1125f80a2f60","block_type":"box","text":"Managers, L.P. (“MLIM”) funds. The Board benefits from Ms. Montgomery’s more than 20","page_number":13,"box":{"x":265,"y":315,"width":641,"height":11}},{"id":"d970805f-ee9f-4e2c-9c46-ff2eddba3dc5","block_type":"box","text":"years of academic experience as a professor at Harvard Business School where she","page_number":13,"box":{"x":264,"y":330,"width":602,"height":11}},{"id":"e38558e1-6639-46cb-bdb8-b3bc27e2464c","block_type":"box","text":"taught courses on corporate strategy and corporate governance. Ms. Montgomery also","page_number":13,"box":{"x":264,"y":345,"width":617,"height":11}},{"id":"df509f1c-9d2d-40fe-874e-45601b9927c1","block_type":"box","text":"has business management and corporate governance experience through her service on","page_number":13,"box":{"x":265,"y":360,"width":629,"height":12}},{"id":"817e3e54-e188-447b-aa5d-cc0695730f57","block_type":"box","text":"the corporate boards of a variety of public companies. She has also authored numerous","page_number":13,"box":{"x":264,"y":375,"width":628,"height":11}},{"id":"b04142fc-5722-491d-b45d-973dfcac1f09","block_type":"box","text":"articles and books on these topics.","page_number":13,"box":{"x":265,"y":391,"width":251,"height":10}},{"id":"4ed87741-b0f0-4bcb-955c-e1ce7a9973b5","block_type":"box","text":"Donald C. Opatrny Donald C. Opatrny has more than 40 years of business, oversight and executive","page_number":13,"box":{"x":70,"y":413,"width":764,"height":11}},{"id":"cf26ac22-082e-4b0c-8396-5c2bade0c510","block_type":"box","text":"experience, including through his service as president, director and investment committee","page_number":13,"box":{"x":265,"y":428,"width":642,"height":12}},{"id":"279a5d4b-f92a-4b3e-b210-0984652cacbf","block_type":"box","text":"chair for academic and not-for-profit organizations, and his experience as a partner,","page_number":13,"box":{"x":264,"y":443,"width":593,"height":12}},{"id":"29272407-1e2d-42ab-b1ff-f914f594fbce","block_type":"box","text":"managing director and advisory director at Goldman Sachs for 32 years. 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None Over","page_number":19,"box":{"x":79,"y":674,"width":752,"height":11}},{"id":"d7bef314-6338-4011-aae2-c56a8e154385","block_type":"box","text":"$100,000","page_number":19,"box":{"x":837,"y":673,"width":72,"height":11}},{"id":"3925feb9-6b1c-40cf-b778-8cd9f7a38a83","block_type":"box","text":"Cynthia A. Montgomery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . None Over","page_number":19,"box":{"x":79,"y":689,"width":752,"height":11}},{"id":"3468e413-1929-45e7-862c-3aa6093271a0","block_type":"box","text":"$100,000","page_number":19,"box":{"x":837,"y":688,"width":72,"height":12}},{"id":"1590694c-875a-4a2b-8c1c-78fb3a623345","block_type":"box","text":"Donald C. Opatrny","page_number":19,"box":{"x":79,"y":704,"width":129,"height":11}},{"id":"9a4eed30-0248-44f1-87ad-a29b286d37c8","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . None Over","page_number":19,"box":{"x":215,"y":704,"width":616,"height":9}},{"id":"5ff4deee-d679-4d69-b24a-bffbae76366b","block_type":"box","text":"$100,000","page_number":19,"box":{"x":837,"y":704,"width":72,"height":11}},{"id":"427ad18d-55b7-4d58-a9b6-b7ff44b90597","block_type":"box","text":"Lori Richards. .","page_number":19,"box":{"x":79,"y":720,"width":105,"height":8}},{"id":"533ad5e0-2417-4761-a9a1-8b572084d26f","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . None None","page_number":19,"box":{"x":190,"y":720,"width":682,"height":8}},{"id":"ba5d08a5-9897-4aaa-ad5a-597f376e2f8c","block_type":"box","text":"Mark Stalnecker","page_number":19,"box":{"x":79,"y":735,"width":115,"height":8}},{"id":"1895c5c6-7016-4eed-a74f-6af53d90ea18","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . None Over","page_number":19,"box":{"x":198,"y":735,"width":633,"height":8}},{"id":"c502096e-71bd-417a-b1e7-f7c91706d0fe","block_type":"box","text":"$100,000","page_number":19,"box":{"x":837,"y":734,"width":72,"height":11}},{"id":"c944a0a8-dcc8-45d3-b735-5069903bce8a","block_type":"box","text":"Marc D. Stern*. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . None None","page_number":19,"box":{"x":79,"y":750,"width":793,"height":9}},{"id":"be5c60f7-fc86-4994-a9f4-f0f6ea746f83","block_type":"box","text":"Kenneth L. Urish .","page_number":19,"box":{"x":79,"y":765,"width":129,"height":9}},{"id":"0c62d6f7-d012-44b0-9392-a3ea1c75c882","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . None Over","page_number":19,"box":{"x":215,"y":765,"width":616,"height":9}},{"id":"5bb17c83-ab56-4ed6-a443-906a1f6a663c","block_type":"box","text":"$100,000","page_number":19,"box":{"x":837,"y":764,"width":72,"height":11}},{"id":"780e0849-8fe1-4a93-8a74-c1d7e8fc317d","block_type":"box","text":"Claire A. Walton . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . None Over","page_number":19,"box":{"x":79,"y":780,"width":752,"height":9}},{"id":"2917e2b8-d915-4395-b3ee-89ef551c9b47","block_type":"box","text":"$100,000","page_number":19,"box":{"x":837,"y":779,"width":72,"height":11}},{"id":"6a333d96-c825-4e9c-88bf-f20b80ac1e93","block_type":"box","text":"Interested Directors","page_number":19,"box":{"x":70,"y":795,"width":140,"height":9}},{"id":"f2bdba36-9b37-47d1-b340-ddf8c0f420a1","block_type":"box","text":"Robert Fairbairn","page_number":19,"box":{"x":79,"y":810,"width":113,"height":9}},{"id":"c4a3e5e3-9f8b-407f-b624-8325fa727460","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . None Over","page_number":19,"box":{"x":198,"y":810,"width":633,"height":9}},{"id":"a849dd17-2623-4766-9d98-ed52cfab0f02","block_type":"box","text":"$100,000","page_number":19,"box":{"x":837,"y":809,"width":72,"height":11}},{"id":"86e7f51e-186c-4c91-8b9e-93709c5c567d","block_type":"box","text":"John M. Perlowski","page_number":19,"box":{"x":78,"y":825,"width":127,"height":9}},{"id":"6b1f54b4-2a18-4f5d-8e40-64dfb20bcfc1","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . None Over","page_number":19,"box":{"x":215,"y":825,"width":616,"height":9}},{"id":"1ae464cd-024e-42c0-b5be-db26715c4541","block_type":"box","text":"$100,000","page_number":19,"box":{"x":837,"y":824,"width":72,"height":12}},{"id":"0eaabcda-456a-475c-a513-c42a3d35644a","block_type":"box","text":"* Information is provided as of April 1, 2026, the date Mr. Jarczyk and Mr. Stern first served as consultants to the Independent Directors.","page_number":19,"box":{"x":70,"y":850,"width":784,"height":8}},{"id":"bf6e3a65-af1e-4661-bcce-0211c9f9f22a","block_type":"box","text":"As of September 3, 2026, the Directors and officers of the Fund as a group directly or indirectly owned an","page_number":19,"box":{"x":101,"y":870,"width":756,"height":12}},{"id":"4562ea29-0e54-4e34-b1ea-3cd8d8a1fdf7","block_type":"box","text":"aggregate of less than 1% of any class of the outstanding shares of the Fund. As of December 31, 2025 (and, with","page_number":19,"box":{"x":69,"y":886,"width":820,"height":11}},{"id":"28a173ac-ef63-4d17-b958-3566945d36c2","block_type":"box","text":"respect to Mr. Jarczyk and Mr. Stern, as of April 1, 2026), none of the Independent Directors of the Fund or their","page_number":19,"box":{"x":69,"y":901,"width":802,"height":11}},{"id":"dd05b35a-85b7-4645-a8df-be67d827f833","block_type":"box","text":"I-17","page_number":19,"box":{"x":476,"y":943,"width":26,"height":9}},{"id":"d0782d6e-8a36-4f3a-adfe-84695941f069","block_type":"box","text":"NM0926U-5977317-19/232","page_number":19,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"77b9bf19-873d-47ce-a814-0a62fdc62bab","block_type":"box","text":"immediate family members owned beneficially or of record any securities of the Fund’s investment adviser, principal","page_number":20,"box":{"x":70,"y":45,"width":824,"height":11}},{"id":"7f7f2980-35c3-458d-83c8-efe1f5d718d0","block_type":"box","text":"underwriter, or any person directly or indirectly controlling, controlled by, or under common control with such entities.","page_number":20,"box":{"x":69,"y":60,"width":830,"height":11}},{"id":"9ae84d65-6b7b-4807-8e96-2a7963e34bf4","block_type":"box","text":"Compensation of Directors","page_number":20,"box":{"x":69,"y":90,"width":194,"height":11}},{"id":"00dc759c-dbaf-43db-b303-5c22768c5d39","block_type":"box","text":"Each Director who is an Independent Director is paid as compensation an annual retainer of $375,000 per year","page_number":20,"box":{"x":102,"y":112,"width":796,"height":12}},{"id":"880b71c3-8415-46be-968d-14f885b3168a","block_type":"box","text":"for his or her services as a board member of the BlackRock-advised Funds in the BlackRock Multi-Asset Complex,","page_number":20,"box":{"x":68,"y":128,"width":810,"height":11}},{"id":"37792594-7c08-4f27-909f-c71058e79f05","block_type":"box","text":"including the Fund, and a $20,000 board meeting fee to be paid for each in-person board meeting attended (and may","page_number":20,"box":{"x":70,"y":142,"width":837,"height":12}},{"id":"f35a65fe-3c57-4f59-9a27-98d12969d32d","block_type":"box","text":"receive a board meeting fee for telephonic attendance at board meetings), for up to five board meetings held in a","page_number":20,"box":{"x":69,"y":158,"width":807,"height":11}},{"id":"4301cf4d-26a1-417b-80e7-42438f642703","block_type":"box","text":"calendar year (compensation for meetings in excess of this number to be determined on a case-by-case basis),","page_number":20,"box":{"x":69,"y":173,"width":791,"height":11}},{"id":"d5fb2822-24cd-45d2-b97e-3b21011b2971","block_type":"box","text":"together with out-of-pocket expenses in accordance with a board policy on travel and other business expenses","page_number":20,"box":{"x":68,"y":188,"width":786,"height":12}},{"id":"24ab9846-21d3-457d-a56d-438c8834943e","block_type":"box","text":"relating to attendance at meetings. The Chairs of the Audit Committee, Compliance Committee, Governance","page_number":20,"box":{"x":69,"y":203,"width":769,"height":12}},{"id":"b2b9b61e-b3dd-4889-81ca-4b9c90268743","block_type":"box","text":"Committee and Performance Oversight Committee are paid as compensation an additional annual retainer of","page_number":20,"box":{"x":69,"y":218,"width":778,"height":12}},{"id":"0a812d0c-75aa-48f6-af75-d4ea490ea66a","block_type":"box","text":"$45,000, respectively. The Chair of the Board is paid an additional annual retainer of $150,000.","page_number":20,"box":{"x":69,"y":233,"width":689,"height":12}},{"id":"67e880ec-8a97-416d-a41a-94a1a735fce3","block_type":"box","text":"The following table sets forth the compensation the Fund paid to the Directors for the fiscal year ended","page_number":20,"box":{"x":101,"y":256,"width":736,"height":12}},{"id":"490a40af-a744-4de0-89c9-070df6570dcf","block_type":"box","text":"May 31, 2026, and the aggregate compensation paid to them by all BlackRock-advised Funds for the calendar year","page_number":20,"box":{"x":70,"y":271,"width":819,"height":12}},{"id":"baf7c517-c596-4090-ad52-e870f55ae254","block_type":"box","text":"ended December 31, 2025.","page_number":20,"box":{"x":69,"y":287,"width":197,"height":10}},{"id":"85eca177-a01c-41ec-be45-dca2d76a6b78","block_type":"box","text":"I-18","page_number":20,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"d6c4f09d-3eb3-492b-a46d-a7a1b12e932a","block_type":"box","text":"NM0926U-5977317-20/232","page_number":20,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"21759704-2a30-4969-aafb-485538cf4024","block_type":"box","text":"Name","page_number":21,"box":{"x":69,"y":108,"width":32,"height":7}},{"id":"45b96bf1-c259-4989-bf71-89bf75da0e14","block_type":"box","text":"Compensation","page_number":21,"box":{"x":577,"y":98,"width":82,"height":9}},{"id":"abd743c2-d95f-4f51-b142-c1dc0ad0368f","block_type":"box","text":"from the Fund","page_number":21,"box":{"x":577,"y":108,"width":81,"height":7}},{"id":"8ae6cb4d-ded3-4303-8f52-a7ac38e741c2","block_type":"box","text":"Estimated Annual","page_number":21,"box":{"x":690,"y":88,"width":101,"height":7}},{"id":"a6815267-c24f-4bbd-afb2-1f830d517637","block_type":"box","text":"Benefits upon","page_number":21,"box":{"x":701,"y":98,"width":79,"height":9}},{"id":"f10b41ef-f774-498f-8683-2e7a1f383968","block_type":"box","text":"Retirement","page_number":21,"box":{"x":709,"y":108,"width":64,"height":7}},{"id":"e8e9e566-4a5f-4f75-9b0c-9553f0c3c6a4","block_type":"box","text":"Aggregate","page_number":21,"box":{"x":835,"y":58,"width":61,"height":9}},{"id":"8eefaecc-0ed8-4d6f-b32a-5f713d25c8af","block_type":"box","text":"Compensation","page_number":21,"box":{"x":824,"y":68,"width":83,"height":9}},{"id":"bb7c4222-319a-49b0-82e9-6fe08a173dff","block_type":"box","text":"from the Fund","page_number":21,"box":{"x":825,"y":78,"width":80,"height":7}},{"id":"475c223e-a21a-4e48-a684-80ca35e7c6a9","block_type":"box","text":"and Other","page_number":21,"box":{"x":837,"y":88,"width":57,"height":7}},{"id":"4355c533-b3ca-4831-8dac-c2d8250d4938","block_type":"box","text":"BlackRock","page_number":21,"box":{"x":833,"y":98,"width":66,"height":7}},{"id":"2f1bd032-2d09-4e83-bb31-b3a7d14cf978","block_type":"box","text":"Advised Funds","page_number":21,"box":{"x":821,"y":108,"width":84,"height":7}},{"id":"606f6863-fb35-4b29-b982-e3fed4540c4a","block_type":"box","text":"1","page_number":21,"box":{"x":906,"y":108,"width":4,"height":4}},{"id":"98daffd7-3efd-47a3-996a-8fac46abdfd0","block_type":"box","text":"Independent Directors:","page_number":21,"box":{"x":70,"y":126,"width":161,"height":11}},{"id":"3b949f61-efcb-413c-816d-4bf3d61fa1f6","block_type":"box","text":"Christopher J. Ailman","page_number":21,"box":{"x":79,"y":141,"width":149,"height":11}},{"id":"877f0474-f32c-4257-89e1-0c12473be879","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,552 None","page_number":21,"box":{"x":234,"y":140,"width":524,"height":12}},{"id":"308cb5ec-3177-465f-9d2e-af27c9a93405","block_type":"box","text":"$445,000","page_number":21,"box":{"x":830,"y":140,"width":72,"height":12}},{"id":"c6b2d386-fbec-40e8-8c96-0e3d3ef35f72","block_type":"box","text":"Susan J. Carter","page_number":21,"box":{"x":79,"y":156,"width":110,"height":9}},{"id":"d5f540a3-26aa-4276-8ca0-03e636ad2b90","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,552 None","page_number":21,"box":{"x":193,"y":155,"width":565,"height":12}},{"id":"814bdf8e-338a-4fd9-a507-96d94c6c7d8b","block_type":"box","text":"$445,000","page_number":21,"box":{"x":830,"y":155,"width":72,"height":12}},{"id":"c7d08f08-1e4d-4b6e-ab7d-a1e2cddae31b","block_type":"box","text":"Collette Chilton . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,552 None","page_number":21,"box":{"x":79,"y":171,"width":679,"height":11}},{"id":"d0b23aca-8fe3-483b-8804-082c526e1e67","block_type":"box","text":"$445,000","page_number":21,"box":{"x":830,"y":171,"width":72,"height":11}},{"id":"0e7a66fe-ca73-4766-b414-f01ef123416f","block_type":"box","text":"Neil A. Cotty. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,611 None","page_number":21,"box":{"x":79,"y":186,"width":679,"height":12}},{"id":"c64f2140-466f-43ec-b8c0-a195f97cd458","block_type":"box","text":"$467,500","page_number":21,"box":{"x":830,"y":186,"width":72,"height":11}},{"id":"20da4753-7e92-4a79-b511-ba11d8a2b42e","block_type":"box","text":"Jeffrey Jarczyk","page_number":21,"box":{"x":78,"y":201,"width":103,"height":12}},{"id":"c49aa0d4-b170-41ca-8067-a35b6e8731e1","block_type":"box","text":"2","page_number":21,"box":{"x":181,"y":202,"width":4,"height":4}},{"id":"e6e310dd-4c3e-4448-8d78-db5f3ea2a026","block_type":"box","text":"............................................","page_number":21,"box":{"x":193,"y":209,"width":352,"height":1}},{"id":"e21fe033-4ff7-4686-a1f8-2447ed3701bf","block_type":"box","text":"$378 None None","page_number":21,"box":{"x":599,"y":201,"width":284,"height":10}},{"id":"03b13783-0199-461c-ae34-4686671bbeab","block_type":"box","text":"Henry R. Keizer","page_number":21,"box":{"x":79,"y":217,"width":109,"height":11}},{"id":"a4c91c1f-fcf5-4556-84c0-78fea8ff6294","block_type":"box","text":"3","page_number":21,"box":{"x":189,"y":217,"width":4,"height":4}},{"id":"bf90ed58-4445-40fe-873a-e573fc6c66e7","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,717 None","page_number":21,"box":{"x":201,"y":216,"width":557,"height":11}},{"id":"f846b093-5f94-49d0-af5d-459fb9c96764","block_type":"box","text":"$490,000","page_number":21,"box":{"x":830,"y":216,"width":72,"height":11}},{"id":"d5cfa25f-3417-4275-9d1d-d80401f1c021","block_type":"box","text":"Cynthia A. Montgomery","page_number":21,"box":{"x":79,"y":232,"width":164,"height":11}},{"id":"658cc9a6-faa0-4286-a3a5-453e07a3717f","block_type":"box","text":"4","page_number":21,"box":{"x":244,"y":232,"width":4,"height":5}},{"id":"c487d147-8ce9-447d-9d33-a9a9c16f261d","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,668 None","page_number":21,"box":{"x":250,"y":231,"width":508,"height":11}},{"id":"c9649c22-b60f-481c-b4a2-beb2e6ce3eb1","block_type":"box","text":"$490,000","page_number":21,"box":{"x":830,"y":231,"width":72,"height":11}},{"id":"19e7b875-41de-4753-ab10-e746d94d5f39","block_type":"box","text":"Donald C. Opatrny","page_number":21,"box":{"x":79,"y":247,"width":129,"height":11}},{"id":"f88d071e-b6cd-42b7-a609-bb931137e624","block_type":"box","text":"5","page_number":21,"box":{"x":208,"y":247,"width":4,"height":5}},{"id":"07981dfe-df3d-4c26-a5c8-9d6fd6e3ae1c","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,668 None","page_number":21,"box":{"x":218,"y":246,"width":540,"height":11}},{"id":"f8d5fbf1-b72d-4fbd-9746-3ca1895457bc","block_type":"box","text":"$490,000","page_number":21,"box":{"x":830,"y":246,"width":72,"height":11}},{"id":"5cbf1667-7755-4d20-a4df-39a59e789684","block_type":"box","text":"Lori Richards . . .","page_number":21,"box":{"x":79,"y":262,"width":116,"height":9}},{"id":"a3dc07b6-625c-44b3-b1af-6a72fa7ca1fb","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,552 None","page_number":21,"box":{"x":201,"y":261,"width":557,"height":11}},{"id":"f3319d0c-6b3a-4f71-bf1b-f6ce12b2de05","block_type":"box","text":"$445,000","page_number":21,"box":{"x":830,"y":261,"width":72,"height":11}},{"id":"6fa2828c-ac01-48ba-b991-4bf6f26d39bb","block_type":"box","text":"Mark Stalnecker","page_number":21,"box":{"x":79,"y":277,"width":115,"height":9}},{"id":"4a201858-1663-4919-ae7d-c8e1e12d6768","block_type":"box","text":"6","page_number":21,"box":{"x":194,"y":277,"width":5,"height":5}},{"id":"46619447-ecc1-4918-bcc6-6d8477a7328b","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,939 None","page_number":21,"box":{"x":201,"y":276,"width":557,"height":12}},{"id":"94cab537-96c4-4977-8c80-8150a670fece","block_type":"box","text":"$595,000","page_number":21,"box":{"x":830,"y":276,"width":72,"height":12}},{"id":"a4632a5f-930c-4c74-b430-8ce8f9934c89","block_type":"box","text":"Marc D. 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$0","page_number":22,"box":{"x":308,"y":698,"width":553,"height":8}},{"id":"8a192af3-b285-4412-9f6b-c03b55b617a0","block_type":"box","text":"Scott Radell 11 53 6 0 1 2","page_number":22,"box":{"x":74,"y":711,"width":783,"height":7}},{"id":"a2d05358-b6bd-43d6-811a-e56a6fe713b6","block_type":"box","text":"$29.03 Billion $20.26 Billion $5.10 Billion $0 $155.42 Million $425.21 Million","page_number":22,"box":{"x":308,"y":723,"width":591,"height":8}},{"id":"498bc289-2da8-4370-8759-5975568b2a34","block_type":"box","text":"Raffaele Savi 38 67 19 0 12 3","page_number":22,"box":{"x":74,"y":736,"width":783,"height":7}},{"id":"0da794cb-8da2-4c78-9c6d-b70f40c1c055","block_type":"box","text":"$54.23 Billion $58.02 Billion $42.55 Billion $0 $22.75 Billion $4.93 Billion","page_number":22,"box":{"x":308,"y":748,"width":582,"height":9}},{"id":"dc8c41d3-ad6f-4a47-b488-d3c6b4e24378","block_type":"box","text":"Por tfolio Manager Compensation Overview","page_number":22,"box":{"x":69,"y":783,"width":304,"height":11}},{"id":"a9babfdb-a917-479e-a49e-c303d99ade8b","block_type":"box","text":"The discussion below describes the portfolio managers’ compensation as of May 31, 2026.","page_number":22,"box":{"x":101,"y":806,"width":656,"height":11}},{"id":"01e3ff48-bf19-4174-8a9f-2734fd1d8b49","block_type":"box","text":"BlackRock’s financial arrangements with its portfolio managers, its competitive compensation and its career","page_number":22,"box":{"x":102,"y":828,"width":774,"height":12}},{"id":"f36a7780-7391-4b47-979a-685ff787ea09","block_type":"box","text":"path emphasis at all levels reflect the value senior management places on key resources. Compensation may include","page_number":22,"box":{"x":70,"y":843,"width":837,"height":12}},{"id":"456e97c1-96d4-47a4-93a0-4e047d6bc9e0","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":22,"box":{"x":69,"y":858,"width":823,"height":12}},{"id":"a2d1ff63-6660-4247-a925-191511beb180","block_type":"box","text":"compensation include a base salary, a performance-based discretionary bonus, participation in various benefits","page_number":22,"box":{"x":69,"y":874,"width":799,"height":11}},{"id":"5ee15c7a-1a92-44c3-bc17-888568b3de55","block_type":"box","text":"programs and one or more of the incentive compensation programs established by BlackRock.","page_number":22,"box":{"x":70,"y":889,"width":670,"height":11}},{"id":"2c1482b2-a6b5-440e-adae-35acb7a8d271","block_type":"box","text":"I-20","page_number":22,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"aed8a184-562f-4a62-8979-61cd4d48d479","block_type":"box","text":"NM0926U-5977317-22/232","page_number":22,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"c5f59ec8-6c40-4358-b8cc-5a754215b8e2","block_type":"box","text":"Base Compensation.","page_number":23,"box":{"x":102,"y":45,"width":148,"height":11}},{"id":"17db9545-9e68-4307-8df3-06c5ff827310","block_type":"box","text":"Generally, portfolio managers receive base compensation based on their position with the","page_number":23,"box":{"x":257,"y":45,"width":640,"height":11}},{"id":"fa39059b-353a-4f7e-b033-a2bf6f5ba3b1","block_type":"box","text":"firm.","page_number":23,"box":{"x":68,"y":60,"width":32,"height":9}},{"id":"c200525d-e79e-410d-ba02-078e90f6c8df","block_type":"box","text":"Discretionary Incentive Compensation — Messrs. Mathieson and Savi and Ms. Hawley","page_number":23,"box":{"x":69,"y":90,"width":631,"height":11}},{"id":"6735a0b9-ac47-4750-a2d0-36e5c4974ae8","block_type":"box","text":"Discretionary incentive compensation is a function of several components: the performance of BlackRock, Inc.,","page_number":23,"box":{"x":102,"y":113,"width":792,"height":11}},{"id":"ebcd6b11-6f2d-4914-81ee-f731cb13a37e","block_type":"box","text":"the performance of the portfolio manager’s group within BlackRock, the investment performance, including risk","page_number":23,"box":{"x":68,"y":128,"width":800,"height":11}},{"id":"fbab2517-22f9-4afe-a30d-b60b181573f8","block_type":"box","text":"adjusted returns, of the firm’s assets under management or supervision by that portfolio manager relative to","page_number":23,"box":{"x":69,"y":143,"width":777,"height":11}},{"id":"cd389ed9-71d5-4805-b505-573f87fc0a4e","block_type":"box","text":"predetermined benchmarks, and the individual’s performance and contribution to the overall performance of these","page_number":23,"box":{"x":70,"y":158,"width":817,"height":11}},{"id":"b650bea1-9958-4868-ba4c-c9591dcd8faa","block_type":"box","text":"portfolios and BlackRock. Among other things, BlackRock’s Chief Investment Officers make a subjective","page_number":23,"box":{"x":70,"y":173,"width":741,"height":11}},{"id":"314080d6-54bb-4289-8b6e-bf565d31266e","block_type":"box","text":"determination with respect to each portfolio manager’s compensation based on the performance of the Funds and","page_number":23,"box":{"x":69,"y":188,"width":818,"height":12}},{"id":"1fa23537-d548-4de4-9b3f-c471201a1a26","block_type":"box","text":"other accounts managed by each portfolio manager relative to the various benchmarks. Performance is generally","page_number":23,"box":{"x":69,"y":203,"width":806,"height":12}},{"id":"ce40bd5b-850c-470c-867b-3ea9dfc22532","block_type":"box","text":"assessed over trailing 1-,3-, and 5-year periods relative to applicable benchmarks. The performance of Messrs.","page_number":23,"box":{"x":69,"y":218,"width":791,"height":12}},{"id":"41350dc2-3a3f-4f16-ac81-d78748d35d50","block_type":"box","text":"Mathieson and Savi and Ms. Hawley is not measured against a specific benchmark.","page_number":23,"box":{"x":70,"y":234,"width":595,"height":11}},{"id":"41769f14-44be-4351-a971-3377bfb02c35","block_type":"box","text":"Discretionary Incentive Compensation — Messrs. Felder, Green and Pensky","page_number":23,"box":{"x":69,"y":264,"width":552,"height":11}},{"id":"0dd83cce-4fda-4ba2-a1a0-3e08f160083b","block_type":"box","text":"Discretionary incentive compensation is a function of several components: the commercial performance of","page_number":23,"box":{"x":102,"y":286,"width":762,"height":12}},{"id":"cb48b2fd-8332-40eb-b939-7a80901d3972","block_type":"box","text":"BlackRock, Inc., the commercial performance of the portfolio manager’s group, client investment performance","page_number":23,"box":{"x":70,"y":302,"width":787,"height":11}},{"id":"101895a5-f8d9-4bd6-9a05-bdfa285f94c7","block_type":"box","text":"relative to predetermined benchmarks for which the portfolio manager’s group is responsible, and the individual’s","page_number":23,"box":{"x":69,"y":317,"width":811,"height":11}},{"id":"005c406e-3c04-4764-b896-274ab9809a14","block_type":"box","text":"contribution to the overall performance of these portfolios and BlackRock. Commercial and investment performance","page_number":23,"box":{"x":69,"y":332,"width":829,"height":11}},{"id":"8d6f7758-a12d-4909-838e-8691fab2cdab","block_type":"box","text":"is generally assessed over trailing 1-,3-, and 5-year periods. The relative benchmarks for these portfolio managers","page_number":23,"box":{"x":70,"y":347,"width":811,"height":11}},{"id":"b50c7d05-8b9b-4d93-a051-c64847ca3e73","block_type":"box","text":"are a combination of market based indices (Russell 1000, MSCI All Country World Index, Bloomberg Global Agg","page_number":23,"box":{"x":69,"y":362,"width":795,"height":11}},{"id":"8ffda469-60ef-470d-a128-92985cdea812","block_type":"box","text":"Treasury Index, Bloomberg US Agg Index, ICE BofA 3-Month US T Bill), certain custom indices and certain fund","page_number":23,"box":{"x":68,"y":377,"width":788,"height":12}},{"id":"73deaec9-47a4-4b02-b5f2-b177c1f99abb","block_type":"box","text":"industry peer groups.","page_number":23,"box":{"x":70,"y":393,"width":149,"height":11}},{"id":"272bea33-9fba-463c-a52d-096c9091af0b","block_type":"box","text":"Discretionary Incentive Compensation — Mr. Radell and Ms. Mohan","page_number":23,"box":{"x":69,"y":423,"width":495,"height":11}},{"id":"b23fe55d-1c7b-40fc-9fd8-d3d51d210169","block_type":"box","text":"Discretionary incentive compensation is a function of several components: the performance of BlackRock, Inc.,","page_number":23,"box":{"x":102,"y":445,"width":792,"height":11}},{"id":"b48fa8ac-9e97-42bc-b818-93343de2e41f","block_type":"box","text":"the performance of the portfolio manager’s group within BlackRock, the investment performance, including risk","page_number":23,"box":{"x":68,"y":460,"width":800,"height":12}},{"id":"6749b91e-e24a-46e3-9756-f03db9a251d2","block_type":"box","text":"adjusted returns, of the firm’s assets under management or supervision by that portfolio manager relative to","page_number":23,"box":{"x":69,"y":475,"width":777,"height":12}},{"id":"1918db4c-c868-4615-b69f-70792199223b","block_type":"box","text":"predetermined benchmarks, and the individual’s performance and contribution to the overall performance of these","page_number":23,"box":{"x":70,"y":491,"width":817,"height":11}},{"id":"0b57e90b-4bf4-4478-ba5d-e112c61161b0","block_type":"box","text":"portfolios and BlackRock. In most cases, these benchmarks are the same as the benchmark or benchmarks against","page_number":23,"box":{"x":70,"y":506,"width":830,"height":11}},{"id":"69b8aaa2-e3d2-4886-9081-117f7ee782fe","block_type":"box","text":"which the performance of the Funds or other accounts managed by the portfolio managers are measured. Among","page_number":23,"box":{"x":68,"y":521,"width":809,"height":11}},{"id":"304a4c14-840f-4c74-bc23-514c5aa7b44f","block_type":"box","text":"other things, BlackRock’s Chief Investment Officers make a subjective determination with respect to each portfolio","page_number":23,"box":{"x":69,"y":536,"width":819,"height":11}},{"id":"6eb8503b-29a9-4245-a460-1e71de0832ca","block_type":"box","text":"manager’s compensation based on the performance of the Funds and other accounts managed by each portfolio","page_number":23,"box":{"x":69,"y":551,"width":805,"height":11}},{"id":"3dd5329b-5ded-48d5-9291-f568c485f0b7","block_type":"box","text":"manager relative to the various benchmarks. Performance of fixed-income funds is measured on a pre-tax and/or","page_number":23,"box":{"x":69,"y":566,"width":807,"height":11}},{"id":"19e35ed5-b33e-4b79-9099-ef7e6652913b","block_type":"box","text":"after-tax basis over various time periods including 1-, 3- and 5- year periods, as applicable. With respect to these","page_number":23,"box":{"x":69,"y":581,"width":803,"height":12}},{"id":"cc4c9f60-ee69-430e-a56f-199e10530db0","block_type":"box","text":"portfolio managers, such benchmarks for the Fund and other accounts are:","page_number":23,"box":{"x":70,"y":596,"width":534,"height":12}},{"id":"ffba6224-81b2-4e32-a987-261b8f7636c9","block_type":"box","text":"Portfolio Manager","page_number":23,"box":{"x":69,"y":625,"width":105,"height":9}},{"id":"66a68435-2f2f-473c-8689-1c819a821d7f","block_type":"box","text":"Benchmarks","page_number":23,"box":{"x":706,"y":625,"width":71,"height":7}},{"id":"d2c0464c-86c4-4106-9630-f03050d2fa27","block_type":"box","text":"Scott Radell. . .","page_number":23,"box":{"x":69,"y":643,"width":107,"height":8}},{"id":"375262a5-6800-4ea6-a525-d1b3de975da3","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A combination of market-","page_number":23,"box":{"x":182,"y":642,"width":578,"height":9}},{"id":"898fae34-11af-4413-a281-cd80a3a2e73c","block_type":"box","text":"based indices (e.g.,","page_number":23,"box":{"x":761,"y":643,"width":138,"height":11}},{"id":"32c1fc62-8a19-4ff0-9743-cff5e5436354","block_type":"box","text":"Bloomberg U.S. Aggregate Bond Index, the","page_number":23,"box":{"x":591,"y":657,"width":302,"height":11}},{"id":"a21d01c3-2a58-47c0-9803-2cdb6266243d","block_type":"box","text":"Bloomberg U.S. TIPS 0-5 Years Index), certain","page_number":23,"box":{"x":579,"y":672,"width":325,"height":11}},{"id":"ca05cb8a-7427-40b2-bdc9-08169fa961f3","block_type":"box","text":"customized indices and certain fund industry","page_number":23,"box":{"x":582,"y":686,"width":320,"height":11}},{"id":"2555b711-04e3-4b40-aece-65cfd309afb3","block_type":"box","text":"peer groups.","page_number":23,"box":{"x":698,"y":702,"width":87,"height":10}},{"id":"8c3a1a14-87af-4817-ad6a-8b510ba61b25","block_type":"box","text":"Jasmita Mohan . . .","page_number":23,"box":{"x":69,"y":716,"width":131,"height":8}},{"id":"7f6271c4-574c-4b21-b5dc-0c719f0cd6bf","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A combination of market-","page_number":23,"box":{"x":207,"y":715,"width":553,"height":9}},{"id":"5606a874-84aa-457b-9d14-0a85347d6779","block_type":"box","text":"based indices (e.g.,","page_number":23,"box":{"x":761,"y":716,"width":138,"height":11}},{"id":"a878d458-0f93-442d-9ad9-f962fc38e9dc","block_type":"box","text":"Bloomberg U.S. Aggregate Bond Index), certain","page_number":23,"box":{"x":575,"y":730,"width":334,"height":11}},{"id":"122f4593-24c8-42ff-9e7c-8efdaac0f1e3","block_type":"box","text":"customized indices and certain fund industry","page_number":23,"box":{"x":582,"y":744,"width":320,"height":12}},{"id":"4d6d769c-203e-4e20-9b43-a33b8cc17ebc","block_type":"box","text":"peer groups.","page_number":23,"box":{"x":698,"y":760,"width":87,"height":10}},{"id":"46a3800a-66df-4352-88df-d984367df073","block_type":"box","text":"Distribution of Discretionary Incentive Compensation.","page_number":23,"box":{"x":102,"y":783,"width":389,"height":11}},{"id":"8063dc19-595f-4465-9308-5c218a17aafb","block_type":"box","text":"Discretionary incentive compensation is distributed to","page_number":23,"box":{"x":499,"y":783,"width":383,"height":11}},{"id":"feb99ade-388e-4293-8a92-c1c786744491","block_type":"box","text":"portfolio managers in a combination of cash, deferred BlackRock, Inc. stock awards, and/or deferred cash awards","page_number":23,"box":{"x":70,"y":798,"width":815,"height":11}},{"id":"9976dbff-cdd4-449c-9050-8e843a275df4","block_type":"box","text":"that notionally track the return of certain BlackRock investment products.","page_number":23,"box":{"x":68,"y":813,"width":522,"height":11}},{"id":"53b744a6-de00-48a9-ae75-04c55dec18d9","block_type":"box","text":"Portfolio managers receive their annual discretionary incentive compensation in the form of cash. Portfolio","page_number":23,"box":{"x":102,"y":836,"width":760,"height":11}},{"id":"781b6287-e8e7-41a7-8709-d3fee5b3f9f7","block_type":"box","text":"managers whose total compensation is above a specified threshold also receive deferred BlackRock, Inc. stock","page_number":23,"box":{"x":69,"y":851,"width":795,"height":11}},{"id":"911d43ff-ab7d-4430-a92d-1455e662109b","block_type":"box","text":"awards annually as part of their discretionary incentive compensation. Paying a portion of discretionary incentive","page_number":23,"box":{"x":69,"y":866,"width":805,"height":11}},{"id":"07d21063-8be1-4fcd-9407-a92f464fb246","block_type":"box","text":"compensation in the form of deferred BlackRock, Inc. stock puts compensation earned by a portfolio manager for a","page_number":23,"box":{"x":69,"y":881,"width":822,"height":11}},{"id":"79ecfe0d-6059-4db8-9e05-a59b8ab62ddc","block_type":"box","text":"given year “at risk” based on BlackRock’s ability to sustain and improve its performance over future periods. In some","page_number":23,"box":{"x":68,"y":896,"width":839,"height":12}},{"id":"01c713ed-2d07-47cd-bad3-63ff8d477f5f","block_type":"box","text":"cases, additional deferred BlackRock, Inc. stock may be granted to certain key employees as part of a long-term","page_number":23,"box":{"x":69,"y":911,"width":802,"height":12}},{"id":"05eb131a-a0c6-485c-aa49-d18f3644e08b","block_type":"box","text":"I-21","page_number":23,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"0b79ecb3-ac89-4cc9-b604-874fc29352df","block_type":"box","text":"NM0926U-5977317-23/232","page_number":23,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"89259a3c-cc10-43fa-a238-e45938ead655","block_type":"box","text":"incentive award to aid in retention, align interests with long-term shareholders and motivate performance. Deferred","page_number":24,"box":{"x":70,"y":45,"width":820,"height":11}},{"id":"8fecee6c-2e6f-49b5-bdd5-20bb0f5e4bce","block_type":"box","text":"BlackRock, Inc. stock awards are generally granted in the form of BlackRock, Inc. restricted stock units that vest","page_number":24,"box":{"x":70,"y":60,"width":801,"height":11}},{"id":"fbdcaaac-0826-409d-b20f-512d89bfb9ad","block_type":"box","text":"pursuant to the terms of the applicable plan and, once vested, settle in BlackRock, Inc. common stock. The portfolio","page_number":24,"box":{"x":70,"y":75,"width":831,"height":11}},{"id":"8a047d27-a7d1-410c-82f1-589962eb5df5","block_type":"box","text":"managers of this Fund have deferred BlackRock, Inc. stock awards.","page_number":24,"box":{"x":69,"y":90,"width":479,"height":11}},{"id":"440d0c3f-f7f0-4298-a6e3-81ccf58b33d4","block_type":"box","text":"For certain portfolio managers, a portion of the discretionary incentive compensation is also distributed in the","page_number":24,"box":{"x":102,"y":113,"width":785,"height":11}},{"id":"074e67ce-294b-47ce-a1e2-3ff811f14be3","block_type":"box","text":"form of deferred cash awards that notionally track the returns of select BlackRock investment products they manage,","page_number":24,"box":{"x":68,"y":128,"width":836,"height":11}},{"id":"cec60993-e955-455a-812a-32d1a883526c","block_type":"box","text":"which provides direct alignment of portfolio manager discretionary incentive compensation with investment product","page_number":24,"box":{"x":68,"y":143,"width":821,"height":11}},{"id":"27d7b93a-ca28-481d-8166-8d5b9b81ce03","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":24,"box":{"x":69,"y":158,"width":829,"height":11}},{"id":"756ba954-87d4-4a2f-8ea8-fa6ba4154c50","block_type":"box","text":"portfolio managers who manage specified products and whose total compensation is above a specified threshold are","page_number":24,"box":{"x":70,"y":173,"width":835,"height":11}},{"id":"9b8bb14c-8eef-418c-a93a-d4be558f9801","block_type":"box","text":"eligible to participate in the deferred cash award program.","page_number":24,"box":{"x":69,"y":188,"width":414,"height":12}},{"id":"313aabbb-0514-41f6-9aa5-04a6e3b059a5","block_type":"box","text":"Other Compensation Benefits.","page_number":24,"box":{"x":101,"y":211,"width":218,"height":11}},{"id":"c0775141-4c7b-415d-b245-4498146cbeae","block_type":"box","text":"In addition to base salary and discretionary incentive compensation, portfolio","page_number":24,"box":{"x":327,"y":211,"width":552,"height":11}},{"id":"de3bcbf5-05ab-40ee-847d-582f3273a804","block_type":"box","text":"managers may be eligible to receive or participate in one or more of the following:","page_number":24,"box":{"x":69,"y":226,"width":582,"height":11}},{"id":"30f0538f-86b1-435d-9b36-4eae9a88d0c9","block_type":"box","text":"Incentive Savings Plans","page_number":24,"box":{"x":102,"y":249,"width":167,"height":11}},{"id":"946a5927-f41a-4a93-aa08-674522c00814","block_type":"box","text":"— BlackRock, Inc. has created a variety of incentive savings plans in which BlackRock","page_number":24,"box":{"x":274,"y":249,"width":614,"height":11}},{"id":"9c53ad50-963d-45a8-af2c-077324f03c93","block_type":"box","text":"employees are eligible to participate, including a 401(k) plan, the BlackRock Retirement Savings Plan (RSP), and the","page_number":24,"box":{"x":69,"y":264,"width":831,"height":11}},{"id":"da8408e5-962b-4df3-8329-dfea111ba338","block_type":"box","text":"BlackRock Employee Stock Purchase Plan (ESPP). The employer contribution components of the RSP include a","page_number":24,"box":{"x":70,"y":279,"width":785,"height":11}},{"id":"d06950cb-7e7f-4f71-8c62-958c1935bdf0","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":24,"box":{"x":69,"y":293,"width":830,"height":12}},{"id":"e4f25a76-65aa-488d-ba7e-2b9afc326268","block_type":"box","text":"company retirement contribution equal to 3-5% of eligible compensation up to the Internal Revenue Service limit","page_number":24,"box":{"x":69,"y":309,"width":799,"height":11}},{"id":"3907884a-860e-4856-a75d-e944c6c699f2","block_type":"box","text":"($360,000 for 2026). The RSP offers a range of investment options, including registered investment companies and","page_number":24,"box":{"x":69,"y":324,"width":831,"height":12}},{"id":"6f42b535-3a9e-482b-b5de-8b03fe23a04f","block_type":"box","text":"collective investment funds managed by the firm. BlackRock contributions follow the investment direction set by","page_number":24,"box":{"x":69,"y":339,"width":798,"height":12}},{"id":"f992cfad-2b26-4fec-8a52-b9570f28326c","block_type":"box","text":"participants for their own contributions or, absent participant investment direction, are invested into a target date","page_number":24,"box":{"x":70,"y":355,"width":809,"height":11}},{"id":"752dda92-9cd5-4f2f-b97a-2f3a32a7cdd0","block_type":"box","text":"fund that corresponds to, or is closest to, the year in which the participant attains age 65. The ESPP allows for","page_number":24,"box":{"x":68,"y":370,"width":793,"height":11}},{"id":"b1370ef1-b84c-41d3-b714-6196a0e8b4df","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":24,"box":{"x":70,"y":385,"width":832,"height":11}},{"id":"bbd4e898-05d1-4094-a8aa-db2294b1de36","block_type":"box","text":"Annual participation in the ESPP is limited to the purchase of 1,000 shares of common stock or a dollar value of","page_number":24,"box":{"x":68,"y":400,"width":805,"height":11}},{"id":"c652c2b0-583f-4703-b5b4-d67bdd98ab95","block_type":"box","text":"$25,000 based on its fair market value on the purchase date. All of the eligible portfolio managers are eligible to","page_number":24,"box":{"x":69,"y":414,"width":808,"height":12}},{"id":"a390e87c-f998-43ac-b149-2baafe7f100e","block_type":"box","text":"participate in these plans.","page_number":24,"box":{"x":70,"y":430,"width":185,"height":11}},{"id":"19524907-0cc6-440f-96eb-b4a179f554f4","block_type":"box","text":"Por tfolio Manager Beneficial Holdings","page_number":24,"box":{"x":69,"y":460,"width":268,"height":12}},{"id":"2a318b8a-03e4-437c-92c5-68a474a8cc45","block_type":"box","text":"As of May 31, 2026, the Fund’s most recently completed fiscal year end, the dollar range of securities","page_number":24,"box":{"x":101,"y":483,"width":731,"height":11}},{"id":"a7c965a3-d054-4baf-a0c8-5f20ee1bcf00","block_type":"box","text":"beneficially owned by the portfolio managers in the Fund is shown below:","page_number":24,"box":{"x":69,"y":498,"width":519,"height":11}},{"id":"f9329180-4a02-4d31-add1-c920a8c452cc","block_type":"box","text":"Portfolio Manager","page_number":24,"box":{"x":69,"y":537,"width":105,"height":8}},{"id":"f5a65141-ffed-4588-8a95-f4437f9e0640","block_type":"box","text":"Dollar Range of Equity","page_number":24,"box":{"x":759,"y":526,"width":129,"height":9}},{"id":"8980b895-126d-408e-836d-440771084aeb","block_type":"box","text":"Securities Beneficially Owned","page_number":24,"box":{"x":736,"y":537,"width":173,"height":8}},{"id":"1a804cda-4de6-4719-b2a4-f095c3f6eb3d","block_type":"box","text":"Philip Green","page_number":24,"box":{"x":69,"y":554,"width":84,"height":11}},{"id":"44b45449-8dc0-4780-9744-194e803022a8","block_type":"box","text":"....................................................................","page_number":24,"box":{"x":157,"y":562,"width":548,"height":1}},{"id":"369116fe-4636-47b0-8ec9-1a99af2dddc5","block_type":"box","text":"$500,001-$1,000,000","page_number":24,"box":{"x":741,"y":554,"width":164,"height":11}},{"id":"91d816ed-e5da-4d51-8928-59eda8c5332b","block_type":"box","text":"Michael Pensky, CFA","page_number":24,"box":{"x":70,"y":569,"width":144,"height":12}},{"id":"1acf0eb1-068c-40c0-a70a-a100fab57d2d","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 50,","page_number":24,"box":{"x":223,"y":569,"width":575,"height":11}},{"id":"e0aa7d46-db6e-4038-ba5d-cab493071765","block_type":"box","text":"001-$100,000","page_number":24,"box":{"x":800,"y":569,"width":105,"height":11}},{"id":"5acb79b8-1aab-4868-a87d-c218fe3934e8","block_type":"box","text":"Daniel Felder, CFA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 50,","page_number":24,"box":{"x":70,"y":584,"width":728,"height":11}},{"id":"edcf7c2c-a617-48bb-8c5a-e9666c4badc4","block_type":"box","text":"001-$100,000","page_number":24,"box":{"x":800,"y":584,"width":105,"height":11}},{"id":"b0f33de5-cd60-4cf0-8ba5-c5a3632cea7a","block_type":"box","text":"Raffaele Savi. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .","page_number":24,"box":{"x":70,"y":600,"width":635,"height":9}},{"id":"a4fe7749-62fd-4ccf-9dca-cda73ae2eee2","block_type":"box","text":"None","page_number":24,"box":{"x":870,"y":600,"width":35,"height":9}},{"id":"3bc8d551-91cb-4178-bea8-939040b5d60b","block_type":"box","text":"Richard Mathieson .","page_number":24,"box":{"x":70,"y":615,"width":138,"height":9}},{"id":"41079663-916a-4598-95d6-2c4e8f679837","block_type":"box","text":".............................................................","page_number":24,"box":{"x":214,"y":622,"width":491,"height":2}},{"id":"73378986-890e-4d6c-b542-54e4117b110d","block_type":"box","text":"None","page_number":24,"box":{"x":870,"y":615,"width":35,"height":9}},{"id":"14d9b5fd-b12b-4edd-8de6-971af8dbf41b","block_type":"box","text":"Anna Hawley, CFA. . .","page_number":24,"box":{"x":68,"y":630,"width":148,"height":11}},{"id":"65eeec53-a562-4ea7-9d15-15598cd57f18","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 10,","page_number":24,"box":{"x":223,"y":629,"width":584,"height":11}},{"id":"07661daa-0572-410f-9925-07d70aac89f4","block_type":"box","text":"001-$50,000","page_number":24,"box":{"x":809,"y":629,"width":96,"height":11}},{"id":"02b1b96f-dd1c-4ae1-b8ee-afc2ba4a8ea6","block_type":"box","text":"Scott Radell","page_number":24,"box":{"x":69,"y":645,"width":84,"height":9}},{"id":"9a23b751-d7a3-453f-a73d-1200e6fcfc77","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1-$10,000","page_number":24,"box":{"x":157,"y":644,"width":748,"height":11}},{"id":"9379b912-7fea-4fd4-a8cf-87d8cab7ca3b","block_type":"box","text":"Jasmita Mohan","page_number":24,"box":{"x":69,"y":660,"width":107,"height":9}},{"id":"e8da4ef9-059f-46ed-bad0-9c7680af9e87","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1-$10,000","page_number":24,"box":{"x":182,"y":659,"width":723,"height":12}},{"id":"74b50bd3-5397-4104-bacd-ce3d7789077f","block_type":"box","text":"Por tfolio Manager Potential Material Conflicts of Interest","page_number":24,"box":{"x":69,"y":692,"width":403,"height":11}},{"id":"5c3306e7-9fa5-40cd-a065-7835a5d04509","block_type":"box","text":"BlackRock has built a professional working environment, firm-wide compliance culture and compliance","page_number":24,"box":{"x":102,"y":714,"width":727,"height":12}},{"id":"f0a74b54-88e7-410e-a4ae-1bf8172eae0a","block_type":"box","text":"procedures and systems designed to protect against potential incentives that may favor one account over another.","page_number":24,"box":{"x":70,"y":729,"width":814,"height":12}},{"id":"091f7b60-7e25-4aa9-b5b6-3df982a690b7","block_type":"box","text":"BlackRock has adopted policies and procedures that address the allocation of investment opportunities, execution of","page_number":24,"box":{"x":70,"y":744,"width":837,"height":11}},{"id":"a628242d-dda8-4dd6-b138-0e695a35935d","block_type":"box","text":"portfolio transactions, personal trading by employees and other potential conflicts of interest that are designed to","page_number":24,"box":{"x":70,"y":760,"width":810,"height":11}},{"id":"91b8dedb-b930-4e28-9f1a-a39edda49fff","block_type":"box","text":"ensure that all client accounts are treated equitably over time. Nevertheless, BlackRock furnishes investment","page_number":24,"box":{"x":69,"y":775,"width":782,"height":11}},{"id":"6be2c064-7c9a-4077-840e-5849e96c81d5","block_type":"box","text":"management and advisory services to numerous clients in addition to the Fund, and BlackRock may, consistent with","page_number":24,"box":{"x":69,"y":790,"width":830,"height":11}},{"id":"3963d6d7-dbae-4117-acd3-364e1e1b1b32","block_type":"box","text":"applicable law, make investment recommendations to other clients or accounts (including accounts which are hedge","page_number":24,"box":{"x":69,"y":805,"width":828,"height":11}},{"id":"9f207966-dfbb-449f-88a5-6ca0e4bd3cbc","block_type":"box","text":"funds or have performance or higher fees paid to BlackRock, or in which portfolio managers have a personal interest","page_number":24,"box":{"x":68,"y":820,"width":834,"height":11}},{"id":"0af8ae6e-de2f-45b4-8ecf-076d92536a3d","block_type":"box","text":"in the receipt of such fees), which may be the same as or different from those made to the Fund. In addition,","page_number":24,"box":{"x":70,"y":835,"width":777,"height":11}},{"id":"f4bd276e-3a44-4589-80b5-b7d51d27c26d","block_type":"box","text":"BlackRock, its affiliates and significant shareholders and any officer, director, shareholder or employee may or may","page_number":24,"box":{"x":70,"y":850,"width":821,"height":12}},{"id":"d42baaa3-7d77-4a25-937f-a001081c539c","block_type":"box","text":"not have an interest in the securities whose purchase and sale BlackRock recommends to the Fund. BlackRock, or","page_number":24,"box":{"x":69,"y":866,"width":819,"height":10}},{"id":"fa40e20b-db83-4870-94d0-782db412acd2","block_type":"box","text":"any of its affiliates or significant shareholders, or any officer, director, shareholder, employee or any member of their","page_number":24,"box":{"x":69,"y":881,"width":832,"height":11}},{"id":"12968087-6891-43a7-99c1-1a4f4288ade9","block_type":"box","text":"families may take different actions than those recommended to the Fund by BlackRock with respect to the same","page_number":24,"box":{"x":68,"y":896,"width":804,"height":11}},{"id":"70d3b769-2aa1-4302-97f4-892013e8673f","block_type":"box","text":"securities. Moreover, BlackRock may refrain from rendering any advice or services concerning securities of","page_number":24,"box":{"x":69,"y":911,"width":760,"height":11}},{"id":"fc23d94e-f484-4c1e-a5b7-c29f0b8a86c6","block_type":"box","text":"I-22","page_number":24,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"a5f4615b-9743-4787-b855-9322b3135235","block_type":"box","text":"NM0926U-5977317-24/232","page_number":24,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"141e345a-c02e-45c1-b53a-3e85e1aa946e","block_type":"box","text":"companies of which any of BlackRock’s (or its affiliates’ or significant shareholders’) officers, directors or employees","page_number":25,"box":{"x":69,"y":45,"width":834,"height":11}},{"id":"dd446639-a85e-404b-b522-3eaae59c3036","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":25,"box":{"x":69,"y":60,"width":836,"height":11}},{"id":"390dffda-a801-4834-b647-1a14330632e6","block_type":"box","text":"officers, directors and employees of any of them has any substantial economic interest or possesses material non","page_number":25,"box":{"x":69,"y":75,"width":822,"height":11}},{"id":"50e9abce-ab3d-4ab0-928d-8e0ad2c86051","block_type":"box","text":"public information. Certain portfolio managers also may manage accounts whose investment strategies may at times","page_number":25,"box":{"x":70,"y":90,"width":835,"height":11}},{"id":"1cfa6c02-6407-4a4d-8119-00a787dcd7f2","block_type":"box","text":"be opposed to the strategy utilized for the Fund. It should also be noted that Messrs. Green, Mathieson, Radell and","page_number":25,"box":{"x":69,"y":105,"width":824,"height":11}},{"id":"19ac7f4e-432e-4a35-8bc2-7f72c97c7273","block_type":"box","text":"Savi and Mses. Hawley and Mohan may be managing hedge fund and/or long only accounts, or may be part of a","page_number":25,"box":{"x":69,"y":120,"width":801,"height":12}},{"id":"9d32c60c-2875-48b0-b8ae-fe1cdb6b04f7","block_type":"box","text":"team managing hedge fund and/or long only accounts, subject to incentive fees. Messrs. Green, Mathieson, Radell","page_number":25,"box":{"x":68,"y":135,"width":822,"height":12}},{"id":"eed3e2ab-45a9-4c44-ae00-598795a20d32","block_type":"box","text":"and Savi and Mses. Hawley and Mohan may therefore be entitled to receive a portion of any incentive fees earned on","page_number":25,"box":{"x":69,"y":150,"width":837,"height":12}},{"id":"3ccbb0ec-5357-42fc-9bf0-92154b35ac65","block_type":"box","text":"such accounts.","page_number":25,"box":{"x":69,"y":166,"width":106,"height":9}},{"id":"f671e473-73de-4ae9-9bce-d906844938aa","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":25,"box":{"x":101,"y":188,"width":788,"height":11}},{"id":"dd781f43-2840-4362-bed3-44f863871210","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":25,"box":{"x":70,"y":203,"width":839,"height":11}},{"id":"da95dc57-a6c2-4c08-af50-d9426923888b","block_type":"box","text":"fiduciary duties. BlackRock attempts to allocate investments in a fair and equitable manner among client accounts,","page_number":25,"box":{"x":68,"y":218,"width":823,"height":12}},{"id":"6b054852-2533-4b70-91e1-8eea2913e670","block_type":"box","text":"with no account receiving preferential treatment. To this end, BlackRock has adopted policies that are intended to","page_number":25,"box":{"x":68,"y":234,"width":812,"height":11}},{"id":"aade5796-6677-4afa-9b84-f737b3d7bbe6","block_type":"box","text":"ensure reasonable efficiency in client transactions and provide BlackRock with sufficient flexibility to allocate","page_number":25,"box":{"x":69,"y":249,"width":777,"height":11}},{"id":"0b8332cd-4ce3-4ba4-9173-19643b239e5c","block_type":"box","text":"investments in a manner that is consistent with the particular investment discipline and client base, as appropriate.","page_number":25,"box":{"x":70,"y":264,"width":826,"height":11}},{"id":"7bbcbbd4-4e29-4bf0-9aef-291bdc2fca11","block_type":"box","text":"Accounting Services","page_number":25,"box":{"x":68,"y":294,"width":150,"height":11}},{"id":"26036e72-82ff-432c-bf87-922a6268b96e","block_type":"box","text":"The Bank of New York Mellon (“BNY Mellon”) provides certain accounting services to the Fund. BNY Mellon","page_number":25,"box":{"x":101,"y":317,"width":763,"height":11}},{"id":"506078fe-62be-4909-bf9d-733ea57902d7","block_type":"box","text":"records investment, capital share and income and expense activities; verifies and transmits trade tickets; maintains","page_number":25,"box":{"x":69,"y":332,"width":828,"height":11}},{"id":"bfdd053b-2abe-4ab1-a9b0-01b386c92741","block_type":"box","text":"accounting ledgers for investment securities; maintains tax lots; reconciles cash with the Fund’s custodian; reports","page_number":25,"box":{"x":69,"y":347,"width":823,"height":11}},{"id":"eebff7a2-5a9a-43fd-9a5b-5e5833009b57","block_type":"box","text":"cash balances to the Manager; prepares certain financial statements; calculates expenses, gains, losses and","page_number":25,"box":{"x":69,"y":362,"width":785,"height":11}},{"id":"60ffbb05-3284-40c8-b252-23c27a341b4c","block_type":"box","text":"income; controls disbursements; works with independent pricing sources; and computes and reports net asset value.","page_number":25,"box":{"x":70,"y":377,"width":837,"height":12}},{"id":"fe28fbf5-2e57-4de9-82b2-af0eaaf6478f","block_type":"box","text":"In connection with its accounting services, BNY Mellon also provides certain administration services.","page_number":25,"box":{"x":70,"y":393,"width":719,"height":11}},{"id":"4b57daf5-d582-4e4a-a978-5749f5cae98a","block_type":"box","text":"The table below shows the amounts paid by the Fund to BNY Mellon and the Manager for accounting services for","page_number":25,"box":{"x":101,"y":415,"width":806,"height":11}},{"id":"af47ca93-e7ce-4208-bc6a-fdeb83d4132d","block_type":"box","text":"the fiscal years shown:","page_number":25,"box":{"x":68,"y":430,"width":163,"height":11}},{"id":"1fbf5f6b-0974-402a-bef1-8de6f9f3a9b9","block_type":"box","text":"Fees Paid","page_number":25,"box":{"x":720,"y":458,"width":56,"height":8}},{"id":"f9850334-8c53-4a54-ac07-575e3494ab1f","block_type":"box","text":"to BNY Mellon","page_number":25,"box":{"x":706,"y":469,"width":83,"height":7}},{"id":"1c4212e0-0d75-4160-bd6e-5eb5cf8f1736","block_type":"box","text":"Fees Paid","page_number":25,"box":{"x":837,"y":458,"width":55,"height":8}},{"id":"e00d2074-cad4-446a-9185-ec6c41110940","block_type":"box","text":"to the Manager","page_number":25,"box":{"x":819,"y":469,"width":90,"height":8}},{"id":"4d41e47b-beef-418f-a927-6cb3b2640e93","block_type":"box","text":"Fiscal Year Ended May 31, 2026 . . .","page_number":25,"box":{"x":70,"y":486,"width":254,"height":11}},{"id":"1b021fcf-c767-43e5-a07f-861fb384cf6f","block_type":"box","text":"...........................................","page_number":25,"box":{"x":331,"y":494,"width":344,"height":1}},{"id":"7bb69134-7da3-4fb0-85f2-8f05772e4140","block_type":"box","text":"$129,641 $0","page_number":25,"box":{"x":712,"y":486,"width":162,"height":11}},{"id":"9fa8f0ad-920b-4cf9-9663-4cd389995adf","block_type":"box","text":"Fiscal Year Ended May 31, 2025 . . .","page_number":25,"box":{"x":70,"y":501,"width":254,"height":11}},{"id":"3e860dea-9521-4b86-84c7-ef4b25ed1848","block_type":"box","text":"...........................................","page_number":25,"box":{"x":331,"y":509,"width":344,"height":1}},{"id":"00d1cdf3-e8df-40d0-bc34-96c9ca14eb79","block_type":"box","text":"$125,466 $0","page_number":25,"box":{"x":712,"y":501,"width":162,"height":11}},{"id":"3ced7ab5-01b1-4745-a6ac-78f887c0cb4a","block_type":"box","text":"Fiscal Year Ended May 31, 2024 . . .","page_number":25,"box":{"x":70,"y":517,"width":254,"height":11}},{"id":"ff780ebf-f975-4693-a8b4-6f743d50f4cc","block_type":"box","text":"...........................................","page_number":25,"box":{"x":331,"y":524,"width":344,"height":1}},{"id":"d05020e8-9954-4949-99a7-df89546f3cca","block_type":"box","text":"$119,868 $0","page_number":25,"box":{"x":712,"y":516,"width":162,"height":11}},{"id":"42f516fc-9be3-4cde-b4b1-a8589c9df9e6","block_type":"box","text":"Custodian","page_number":25,"box":{"x":69,"y":548,"width":72,"height":9}},{"id":"cbba2d0c-9394-41fa-8841-9e73f2500efd","block_type":"box","text":"BNY Mellon, which has its principal offices at 240 Greenwich Street, New York, New York 10286, serves as the","page_number":25,"box":{"x":102,"y":571,"width":794,"height":11}},{"id":"0644ddbc-9487-4da4-b935-32d2bc33c51e","block_type":"box","text":"custodian for the Fund (the “Custodian”). The Custodian, among other responsibilities, maintains a custody account","page_number":25,"box":{"x":69,"y":586,"width":828,"height":11}},{"id":"ba4e0c34-03ff-4d3f-8d78-4b52dc45d1a5","block_type":"box","text":"or accounts in the name of the Fund, receives and delivers all assets for the Fund upon purchase and upon sale or","page_number":25,"box":{"x":69,"y":601,"width":820,"height":11}},{"id":"9ddc781c-cc1e-42f8-99ab-7ecd41843898","block_type":"box","text":"maturity, and collects and receives all income and other payments and distributions on account of the assets of the","page_number":25,"box":{"x":69,"y":616,"width":825,"height":11}},{"id":"8702e79c-a1e4-41b2-b3f0-01d2b7040b34","block_type":"box","text":"Fund.","page_number":25,"box":{"x":70,"y":631,"width":36,"height":9}},{"id":"e71a3ee4-b497-4bc5-9466-e4a4f01dbabc","block_type":"box","text":"Transfer Agency and Shareholders’ Administrative Services","page_number":25,"box":{"x":68,"y":661,"width":432,"height":11}},{"id":"7321a35d-735a-4267-976a-7109fe654a17","block_type":"box","text":"BNY Mellon Investment Servicing (US) Inc., which has its principal place of business at 118 Flanders Road,","page_number":25,"box":{"x":102,"y":684,"width":764,"height":11}},{"id":"b8a49a4e-2b6a-4596-a14a-5a9772ebf2e3","block_type":"box","text":"Westborough, Massachusetts 01581, serves as the transfer and dividend disbursement agent for the Fund.","page_number":25,"box":{"x":68,"y":699,"width":771,"height":11}},{"id":"7a2c920d-25b7-4c15-bdf2-2b71926198a8","block_type":"box","text":"Pursuant to a Shareholders’ Administrative Services Agreement, the Manager provides certain shareholder","page_number":25,"box":{"x":102,"y":722,"width":762,"height":11}},{"id":"0bc788ed-0297-4282-87b4-16325e9e4c65","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":25,"box":{"x":70,"y":737,"width":834,"height":11}},{"id":"d51d98be-0a9f-4709-929a-bd064a07ae66","block_type":"box","text":"in maintaining the service center, which costs include, among other things, employee salaries, leasehold expenses,","page_number":25,"box":{"x":70,"y":752,"width":823,"height":11}},{"id":"d0600be9-6028-4ed8-8fe2-89b96733398d","block_type":"box","text":"and other out-of-pocket expenses which are a component of the transfer agency fees in the Fund’s annual report.","page_number":25,"box":{"x":69,"y":767,"width":807,"height":11}},{"id":"f2fe2c8f-5215-4dad-a53b-709dbd0135de","block_type":"box","text":"For the years shown, the Fund reimbursed to the Manager fees for shareholder liaison services pursuant to such","page_number":25,"box":{"x":102,"y":790,"width":803,"height":11}},{"id":"c79afb33-e392-4256-b31d-4a7ce4722f12","block_type":"box","text":"agreement as follows:","page_number":25,"box":{"x":69,"y":805,"width":156,"height":11}},{"id":"370578c7-64ad-46ac-b252-89be62c2c9e2","block_type":"box","text":"Fees Paid","page_number":25,"box":{"x":717,"y":833,"width":55,"height":7}},{"id":"36ea12d8-fada-40c4-b589-b6a6f89cd28c","block_type":"box","text":"to the Manager","page_number":25,"box":{"x":699,"y":843,"width":90,"height":9}},{"id":"ec558ba4-f98b-4c34-9a69-9f9da4358524","block_type":"box","text":"Fees Waived by","page_number":25,"box":{"x":820,"y":833,"width":89,"height":9}},{"id":"25e82626-f1a7-4aa5-a841-4daec6c8d2f4","block_type":"box","text":"the Manager","page_number":25,"box":{"x":827,"y":843,"width":74,"height":9}},{"id":"63c6abeb-3349-4710-8188-c5c458c2bfb9","block_type":"box","text":"Fiscal Year Ended May 31, 2026 . . . . . . . . . . . .","page_number":25,"box":{"x":70,"y":861,"width":329,"height":11}},{"id":"864a2d4c-d14c-48a4-9d2a-df3daa1f06ec","block_type":"box","text":".................................","page_number":25,"box":{"x":406,"y":868,"width":262,"height":2}},{"id":"796c63a0-5280-45be-b253-9b6e7dfed2f6","block_type":"box","text":"$60,072 $0","page_number":25,"box":{"x":713,"y":860,"width":160,"height":12}},{"id":"4f6edd2a-575e-429d-8823-be49c80ac732","block_type":"box","text":"Fiscal Year Ended May 31, 2025 . . . . . . . . . . . .","page_number":25,"box":{"x":70,"y":876,"width":329,"height":11}},{"id":"c72833ab-a187-4f69-a570-8bd770047459","block_type":"box","text":".................................","page_number":25,"box":{"x":406,"y":884,"width":262,"height":1}},{"id":"0f679a95-f1d2-49ba-96a6-3f1df9e03e8d","block_type":"box","text":"$55,333 $0","page_number":25,"box":{"x":713,"y":875,"width":160,"height":12}},{"id":"3c7be0da-cc62-4227-a6bf-d4cbb6203385","block_type":"box","text":"Fiscal Year Ended May 31, 2024 . . . . . . . . . . . .","page_number":25,"box":{"x":70,"y":891,"width":329,"height":11}},{"id":"37fab928-edc9-4dac-be45-214747af6046","block_type":"box","text":".................................","page_number":25,"box":{"x":406,"y":899,"width":262,"height":1}},{"id":"213a4423-b4cb-4b1e-b694-cca82e124c8e","block_type":"box","text":"$84,020 $0","page_number":25,"box":{"x":713,"y":891,"width":160,"height":11}},{"id":"9b92c7e1-21a5-4e7c-880a-49bd9b6270ef","block_type":"box","text":"I-23","page_number":25,"box":{"x":476,"y":943,"width":26,"height":9}},{"id":"d9f0d4ef-a38b-4958-8830-63cfd00e9bcd","block_type":"box","text":"NM0926U-5977317-25/232","page_number":25,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"f01d4fef-9404-46ff-9d6b-6e4336a3644a","block_type":"box","text":"Credit Agreement","page_number":26,"box":{"x":70,"y":45,"width":123,"height":11}},{"id":"d26922f9-17e6-4c6c-b6ec-0ff38163be38","block_type":"box","text":"The Fund, along with certain other funds managed by the Manager and its affiliates (“Participating Funds”), is a","page_number":26,"box":{"x":101,"y":67,"width":797,"height":12}},{"id":"5a0c1903-cf7a-4314-afff-5201504921a5","block_type":"box","text":"party to a 364-day $2.4 billion credit agreement with a group of lenders, which facility terminates on April 8, 2027,","page_number":26,"box":{"x":70,"y":82,"width":818,"height":12}},{"id":"09e0c43d-54bb-4caa-9d86-2dbdf748429b","block_type":"box","text":"unless otherwise extended or renewed (the “Credit Agreement”). Excluding commitments designated for certain","page_number":26,"box":{"x":69,"y":98,"width":796,"height":11}},{"id":"28287af1-2368-454b-9f98-e6645efdf21e","block_type":"box","text":"Participating Funds, the Participating Funds, including the Fund, can borrow up to an aggregate commitment amount","page_number":26,"box":{"x":69,"y":113,"width":830,"height":11}},{"id":"a71ad6f6-131b-4082-9679-41dadaf3fd05","block_type":"box","text":"of $1.75 billion at any time outstanding, subject to asset coverage and other limitations as specified in the Credit","page_number":26,"box":{"x":69,"y":127,"width":811,"height":12}},{"id":"1a940245-9f38-4f24-9619-33660a4de16b","block_type":"box","text":"Agreement. The Fund may borrow under the Credit Agreement to meet shareholder redemptions and for other lawful","page_number":26,"box":{"x":68,"y":143,"width":825,"height":11}},{"id":"0c818341-7b6c-437a-b04c-cc905a0b232a","block_type":"box","text":"purposes. However, the Fund may not borrow under the Credit Agreement for leverage. The Fund may borrow up to","page_number":26,"box":{"x":70,"y":158,"width":813,"height":11}},{"id":"4da59277-4820-446c-a950-e6cdef5d72f5","block_type":"box","text":"the maximum amount allowable under its current Prospectuses and SAI, subject to various other legal, regulatory or","page_number":26,"box":{"x":68,"y":173,"width":829,"height":11}},{"id":"68b1fc71-fdc3-4ca4-948d-bf32cb657b66","block_type":"box","text":"contractual limits. Borrowing results in interest expense and other fees and expenses for the Fund which may impact","page_number":26,"box":{"x":69,"y":188,"width":834,"height":12}},{"id":"9b4d8102-00d8-4092-a210-2c40fb79d7df","block_type":"box","text":"the Fund’s net expenses. The costs of borrowing may reduce the Fund’s return. The Fund is charged its pro rata","page_number":26,"box":{"x":68,"y":203,"width":800,"height":12}},{"id":"bd504cf1-2fad-45bb-badc-b7ffc623b9e9","block_type":"box","text":"share of upfront fees and commitment fees on the aggregate commitment amount based on its net assets. If the","page_number":26,"box":{"x":69,"y":218,"width":809,"height":12}},{"id":"abeae6c4-8c9d-48fc-843e-e11d26568c2c","block_type":"box","text":"Fund borrows pursuant to the Credit Agreement, the Fund will be charged interest at a variable rate.","page_number":26,"box":{"x":70,"y":234,"width":710,"height":11}},{"id":"a69bfc22-3a48-4fe7-a357-f0425661f02b","block_type":"box","text":"V. Information on Sales Charges and Distribution Related Expenses","page_number":26,"box":{"x":68,"y":264,"width":491,"height":11}},{"id":"08f73d0a-6db9-4862-a5ea-33ee359941ca","block_type":"box","text":"Set forth below is information on sales charges (including any contingent deferred sales charges (“CDSCs”))","page_number":26,"box":{"x":102,"y":286,"width":773,"height":12}},{"id":"f938054b-ff13-4fe0-a58a-7b502346df00","block_type":"box","text":"received by the Fund, including the amounts paid to affiliates of the Manager (“Affiliates”) for the periods shown.","page_number":26,"box":{"x":69,"y":302,"width":805,"height":11}},{"id":"0e8f2016-9793-4d19-9eb2-8d82f3cd1086","block_type":"box","text":"BlackRock Investments, LLC (“BRIL” or the “Distributor”), an affiliate of the Manager, acts as the Fund’s sole","page_number":26,"box":{"x":70,"y":317,"width":779,"height":11}},{"id":"645bb0e4-9e1c-4374-ac50-aabc38551025","block_type":"box","text":"distributor. Institutional Shares are not subject to a sales charge.","page_number":26,"box":{"x":69,"y":332,"width":465,"height":11}},{"id":"5640f3b9-4131-4439-9e85-6ca20b09cfc4","block_type":"box","text":"Investor A Shares","page_number":26,"box":{"x":645,"y":360,"width":102,"height":7}},{"id":"5270c15f-07ea-4bd9-93ec-b73f59b79f11","block_type":"box","text":"Gross Sales","page_number":26,"box":{"x":484,"y":386,"width":69,"height":7}},{"id":"9616ff69-5d9b-474f-be63-e6afd31f6f85","block_type":"box","text":"Charges","page_number":26,"box":{"x":495,"y":396,"width":47,"height":9}},{"id":"261e07f1-b619-48db-92f6-87e1ee937117","block_type":"box","text":"Collected","page_number":26,"box":{"x":491,"y":406,"width":55,"height":7}},{"id":"772e4548-f68e-4530-bba6-41efd8302eab","block_type":"box","text":"Sales Charges","page_number":26,"box":{"x":585,"y":386,"width":84,"height":9}},{"id":"8c67eb99-5f63-400a-8527-5cd7bc08de60","block_type":"box","text":"Retained by","page_number":26,"box":{"x":593,"y":396,"width":69,"height":9}},{"id":"c2c13ece-04f2-4e70-a5f2-d9e45180a3e0","block_type":"box","text":"the Distributor","page_number":26,"box":{"x":585,"y":406,"width":84,"height":7}},{"id":"ae8d11b8-7d7a-4e1b-8b0f-f0483ea21a59","block_type":"box","text":"Sales Charges","page_number":26,"box":{"x":699,"y":386,"width":83,"height":9}},{"id":"2c0b0207-fc6a-4a75-8105-f6983fd6474f","block_type":"box","text":"Paid to","page_number":26,"box":{"x":721,"y":396,"width":40,"height":7}},{"id":"2061642d-9700-44e9-8d00-547001efc782","block_type":"box","text":"Affiliates","page_number":26,"box":{"x":715,"y":406,"width":51,"height":7}},{"id":"a13c3e9c-0265-4d33-9d62-482aafdcd6d8","block_type":"box","text":"CDSCs Received","page_number":26,"box":{"x":812,"y":376,"width":97,"height":7}},{"id":"fa871edd-69cc-440c-8e38-a7d940da5767","block_type":"box","text":"on Redemption","page_number":26,"box":{"x":817,"y":386,"width":87,"height":9}},{"id":"7d50e22f-d2b0-42d6-b7bf-361897dd5929","block_type":"box","text":"of Load-Waived","page_number":26,"box":{"x":817,"y":396,"width":87,"height":7}},{"id":"db7a6923-7c7c-496a-99e0-5be64dcf0626","block_type":"box","text":"Shares","page_number":26,"box":{"x":841,"y":406,"width":39,"height":7}},{"id":"481411ab-98dc-42b2-ad3c-afa6b4dd9f3f","block_type":"box","text":"Fiscal Year Ended May 31, 2026. . . . . . . . . . . . . . . . . . . $279,045 $18,029 $18,029 $16,757","page_number":26,"box":{"x":70,"y":423,"width":821,"height":12}},{"id":"aafb7a74-10a2-4e7b-958b-3e66b3cb95e9","block_type":"box","text":"Fiscal Year Ended May 31, 2025. . . . . . . . . . . . . . . . . . . $220,791 $14,024 $14,024 $15,368","page_number":26,"box":{"x":70,"y":438,"width":822,"height":12}},{"id":"348e3d84-53ab-460c-9e0c-03754aef6b3c","block_type":"box","text":"Fiscal Year Ended May 31, 2024. . . . . . . . . . . . . . . . . . . $217,084 $13,597 $13,597 $22,270","page_number":26,"box":{"x":70,"y":453,"width":822,"height":12}},{"id":"8595ab62-37ce-4f63-ba80-5750809b8415","block_type":"box","text":"Investor C Shares","page_number":26,"box":{"x":775,"y":484,"width":102,"height":7}},{"id":"2bdb6dfe-5903-4e64-ab4d-fcf10d217bb1","block_type":"box","text":"CDSCs","page_number":26,"box":{"x":764,"y":499,"width":40,"height":8}},{"id":"f6c006c2-ea38-4d93-9769-cb250a4206ce","block_type":"box","text":"Received by","page_number":26,"box":{"x":750,"y":509,"width":69,"height":9}},{"id":"4bbc0f0e-d21b-4733-9764-a1d2ddd11906","block_type":"box","text":"the Distributor","page_number":26,"box":{"x":742,"y":520,"width":84,"height":7}},{"id":"730a0a4f-1535-4055-a716-a707b0083e2a","block_type":"box","text":"CDSCs","page_number":26,"box":{"x":863,"y":499,"width":39,"height":8}},{"id":"0d8cdd35-e9a6-48f6-b309-b2d3a7c9c843","block_type":"box","text":"Paid to","page_number":26,"box":{"x":863,"y":509,"width":40,"height":8}},{"id":"4fdd8385-81cb-4fb0-91c1-0efca76de61a","block_type":"box","text":"Affiliates","page_number":26,"box":{"x":856,"y":520,"width":52,"height":7}},{"id":"5e3cf42d-72bc-4371-bcca-5e70a5986b55","block_type":"box","text":"Fiscal Year Ended May 31, 2026","page_number":26,"box":{"x":70,"y":537,"width":230,"height":11}},{"id":"7bd54128-ca74-44bf-ba69-062b6e1e91d3","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $7,766 $7,766","page_number":26,"box":{"x":310,"y":537,"width":599,"height":11}},{"id":"ee34ae73-322a-44c5-a8c1-bfcf0af7b890","block_type":"box","text":"Fiscal Year Ended May 31, 2025","page_number":26,"box":{"x":70,"y":552,"width":230,"height":12}},{"id":"6e8e91ab-4b71-468e-ade7-6cf5cfc5fa9a","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $6,049 $6,049","page_number":26,"box":{"x":310,"y":552,"width":599,"height":11}},{"id":"f49a2503-693a-4cbb-b945-23f639c3fbbe","block_type":"box","text":"Fiscal Year Ended May 31, 2024","page_number":26,"box":{"x":70,"y":568,"width":230,"height":11}},{"id":"ee6a9f07-ea0c-4599-949c-3827df2f005c","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $9,598 $9,598","page_number":26,"box":{"x":310,"y":567,"width":599,"height":11}},{"id":"34b16165-e613-42af-aefd-176ea4fff59a","block_type":"box","text":"The table below provides information for the fiscal year ended May 31, 2026 about the 12b-1 fees the Fund paid","page_number":26,"box":{"x":101,"y":591,"width":805,"height":12}},{"id":"93af3be4-f8af-45c8-a261-d58e8a83a9b4","block_type":"box","text":"to the Distributor under the Fund’s 12b-1 plans. A portion of the fees collected by the Distributor were paid to","page_number":26,"box":{"x":68,"y":606,"width":782,"height":12}},{"id":"227f5d1b-01a5-4daa-8a99-e93e6f5c29cf","block_type":"box","text":"affiliates for providing shareholder servicing activities for Investor A Shares and for providing shareholder servicing","page_number":26,"box":{"x":69,"y":622,"width":818,"height":11}},{"id":"0b070294-db1f-49a5-b172-6b1273206fe5","block_type":"box","text":"and distribution-related activities and services for Investor C and Class R Shares.","page_number":26,"box":{"x":69,"y":637,"width":579,"height":9}},{"id":"b81bce82-d30f-4167-abd4-c57798de7f48","block_type":"box","text":"Class Name","page_number":26,"box":{"x":69,"y":675,"width":68,"height":7}},{"id":"99f3022c-dedf-406d-a7a8-04cbfecb433c","block_type":"box","text":"Fees Paid","page_number":26,"box":{"x":831,"y":665,"width":56,"height":7}},{"id":"e52ef625-2470-4fa1-8a35-3227ec538e00","block_type":"box","text":"to the Distributor","page_number":26,"box":{"x":809,"y":675,"width":100,"height":7}},{"id":"29b1a18d-8797-467d-bc7f-8c150953d8c9","block_type":"box","text":"Investor A Shares","page_number":26,"box":{"x":70,"y":693,"width":124,"height":9}},{"id":"8d46702e-a3c7-4151-9918-71586ba963f5","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $2,","page_number":26,"box":{"x":198,"y":692,"width":640,"height":11}},{"id":"e6597e0c-f26b-42a5-8501-7491eb05f7ba","block_type":"box","text":"377,310","page_number":26,"box":{"x":840,"y":693,"width":63,"height":10}},{"id":"d5b07bf7-6ee5-4d32-bc92-f6f3a91ddbd3","block_type":"box","text":"Investor C Shares. . .","page_number":26,"box":{"x":70,"y":708,"width":146,"height":9}},{"id":"6b92242c-c86d-455f-83a6-c1492deb4562","block_type":"box","text":"..................................................................... $","page_number":26,"box":{"x":222,"y":707,"width":602,"height":11}},{"id":"c796586e-d83b-468b-80d2-e23e2752da64","block_type":"box","text":"799,196","page_number":26,"box":{"x":841,"y":708,"width":62,"height":10}},{"id":"eb4c8fa6-7910-47d9-a84f-10aad94ba289","block_type":"box","text":"Class R Shares. . .","page_number":26,"box":{"x":69,"y":723,"width":130,"height":9}},{"id":"8c3b483e-aedb-42ce-9c25-076bc71dbba6","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 62,544","page_number":26,"box":{"x":206,"y":722,"width":697,"height":12}},{"id":"2e737847-a22a-487c-9c4a-b3ba4c01728b","block_type":"box","text":"I-24","page_number":26,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"ff6790d5-2769-4be6-9e74-4d0411a42e33","block_type":"box","text":"NM0926U-5977317-26/232","page_number":26,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"9d8409e3-712d-4c7c-a6d6-a013416a29b3","block_type":"box","text":"VI. Computation of Offering Price Per Share","page_number":27,"box":{"x":68,"y":45,"width":318,"height":11}},{"id":"2efe0a09-73b1-49cc-b2e2-25c1bfdf5e58","block_type":"box","text":"An illustration of the computation of the public offering price of the Investor A Shares of the Fund based on the","page_number":27,"box":{"x":101,"y":67,"width":790,"height":12}},{"id":"8d9a9e67-c764-4619-8447-d19687313df7","block_type":"box","text":"value of the Fund’s Investor A Shares’ net assets and number of Investor A Shares outstanding as of May 31, 2026,","page_number":27,"box":{"x":68,"y":82,"width":833,"height":12}},{"id":"cb353a77-1455-4f70-bd68-a62bd07f0d64","block_type":"box","text":"is set forth below.","page_number":27,"box":{"x":70,"y":98,"width":126,"height":9}},{"id":"6b1957a4-9a6e-42a0-b2d0-a948c4d242ed","block_type":"box","text":"Investor A Shares","page_number":27,"box":{"x":798,"y":126,"width":102,"height":7}},{"id":"bec179a8-68c1-4509-be6b-0c1d3a98a228","block_type":"box","text":"Net Assets . . .","page_number":27,"box":{"x":70,"y":144,"width":100,"height":9}},{"id":"e7626331-8965-4a36-a7b7-536480dee936","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,000,","page_number":27,"box":{"x":176,"y":143,"width":669,"height":11}},{"id":"cf4017ab-d68c-4ead-865c-c2be2ee6c388","block_type":"box","text":"502,314","page_number":27,"box":{"x":847,"y":144,"width":62,"height":10}},{"id":"167f613d-4c55-4332-839a-d5ed0fada31f","block_type":"box","text":"Number of Shares Outstanding . . . . . . . . . . . .","page_number":27,"box":{"x":70,"y":159,"width":320,"height":11}},{"id":"c8c58157-f6fe-421a-9cec-8c9d797dd94a","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33,","page_number":27,"box":{"x":396,"y":159,"width":449,"height":10}},{"id":"71490456-03ae-4ca3-a704-0f782258f0bc","block_type":"box","text":"810,799","page_number":27,"box":{"x":847,"y":159,"width":62,"height":10}},{"id":"7fa96348-a608-4c2f-bf77-7d2d0155b059","block_type":"box","text":"Net Asset Value Per Share (net assets divided by number of shares outstanding)","page_number":27,"box":{"x":70,"y":174,"width":571,"height":11}},{"id":"3c350d9b-f6aa-4b47-b59b-3d311d5cb3cb","block_type":"box","text":"..............","page_number":27,"box":{"x":649,"y":181,"width":108,"height":2}},{"id":"0b716d2b-899a-45c8-9ab7-17e7aa3c634e","block_type":"box","text":"$29.59","page_number":27,"box":{"x":857,"y":173,"width":52,"height":11}},{"id":"803407db-7f9d-4bbb-a40a-521c9919bcce","block_type":"box","text":"Sales Charge (5.25% of offering price; 5.54% of net asset value per share)","page_number":27,"box":{"x":69,"y":189,"width":534,"height":11}},{"id":"84da8cfc-3511-4e27-9bad-b430185a537b","block_type":"box","text":"1","page_number":27,"box":{"x":604,"y":189,"width":4,"height":5}},{"id":"3513e4c7-67f1-4db9-9c8e-0c8c4a8e8872","block_type":"box","text":". . . . . . . . . . . . . . . . . . $1.64","page_number":27,"box":{"x":616,"y":188,"width":293,"height":11}},{"id":"f6273c48-13f7-4286-9397-d3a2e3ed5d1e","block_type":"box","text":"Offering Price. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .","page_number":27,"box":{"x":69,"y":208,"width":687,"height":12}},{"id":"bdfcd1a1-93d4-4b04-b1de-6f9e2073a530","block_type":"box","text":"$31.23","page_number":27,"box":{"x":857,"y":208,"width":52,"height":10}},{"id":"efb73255-5e23-4703-b3bd-dec6f67f6727","block_type":"box","text":"1","page_number":27,"box":{"x":69,"y":241,"width":3,"height":3}},{"id":"fd22556e-f285-4223-ba3e-c991ed76ec6d","block_type":"box","text":"Rounded to the nearest one-hundredth percent; assumes maximum sales charge is applicable.","page_number":27,"box":{"x":94,"y":241,"width":541,"height":8}},{"id":"5516e788-9353-401e-a266-8a92b178477b","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":27,"box":{"x":101,"y":261,"width":787,"height":12}},{"id":"9df0344b-bc7e-4a44-a3d6-56612f0aa112","block_type":"box","text":"set forth above for Investor A Shares. Though not subject to a sales charge, certain share classes may be subject to","page_number":27,"box":{"x":69,"y":276,"width":833,"height":12}},{"id":"c2a55b46-8a9e-451c-b7b4-f8dc553c4256","block_type":"box","text":"a CDSC on redemption. For more information on the purchasing and valuation of shares, please see “Purchase of","page_number":27,"box":{"x":69,"y":292,"width":813,"height":11}},{"id":"8d22f7c3-ba15-4d6e-9a44-b24b5aba30a6","block_type":"box","text":"Shares” and “Pricing of Shares” in Part II of this Statement of Additional Information.","page_number":27,"box":{"x":69,"y":307,"width":607,"height":11}},{"id":"f178589a-5164-4fa6-8d9e-e9f6459ce92b","block_type":"box","text":"VII. Portfolio Transactions and Brokerage","page_number":27,"box":{"x":68,"y":337,"width":302,"height":11}},{"id":"eaceded8-0ec8-4167-8ed5-2adb35e74f05","block_type":"box","text":"See “Portfolio Transactions and Brokerage” in Part II of this Statement of Additional Information for more","page_number":27,"box":{"x":102,"y":360,"width":750,"height":11}},{"id":"5ba72a1a-2bda-46e9-9ff6-6d47efa729a2","block_type":"box","text":"information.","page_number":27,"box":{"x":70,"y":375,"width":83,"height":9}},{"id":"0d79874b-dc31-4afe-910f-deda9200b5e1","block_type":"box","text":"Information about the brokerage commissions paid by the Fund, including commissions paid to Affiliates, for the","page_number":27,"box":{"x":102,"y":397,"width":801,"height":12}},{"id":"8efbe881-375d-492f-96c5-f0de76b488df","block_type":"box","text":"periods shown is set forth in the following table:","page_number":27,"box":{"x":70,"y":412,"width":342,"height":12}},{"id":"c734b3a8-d834-4874-a61b-c8dc205cf1d2","block_type":"box","text":"Aggregate Brokerage","page_number":27,"box":{"x":613,"y":441,"width":125,"height":9}},{"id":"89db3306-4353-427f-9cb4-99a22ac65e17","block_type":"box","text":"Commissions Paid","page_number":27,"box":{"x":623,"y":451,"width":106,"height":7}},{"id":"307ae969-c2b2-4ba2-af24-3093f3063169","block_type":"box","text":"Brokerage Commissions","page_number":27,"box":{"x":769,"y":441,"width":140,"height":9}},{"id":"a6622de2-a707-4f80-8517-2835a5b71db0","block_type":"box","text":"Paid to Affiliates","page_number":27,"box":{"x":791,"y":451,"width":96,"height":7}},{"id":"970fb054-9a37-41bd-bb27-db3d2858bef4","block_type":"box","text":"Fiscal Year Ended May 31, 2026. . . . . . . .","page_number":27,"box":{"x":70,"y":469,"width":292,"height":11}},{"id":"0054243c-68c8-4f9e-8294-b8ac0daa4c46","block_type":"box","text":"...........................","page_number":27,"box":{"x":369,"y":476,"width":213,"height":1}},{"id":"9b724756-09b7-4a4a-bed2-ec242a301c4f","block_type":"box","text":"$250,725 $0","page_number":27,"box":{"x":640,"y":468,"width":208,"height":11}},{"id":"7bb97f5b-d41d-4acc-8f0e-8b077ff1109c","block_type":"box","text":"Fiscal Year Ended May 31, 2025. . . . . . . .","page_number":27,"box":{"x":70,"y":484,"width":292,"height":11}},{"id":"7406c77c-0244-4025-bea1-6cf1aeafd8dd","block_type":"box","text":"...........................","page_number":27,"box":{"x":369,"y":491,"width":213,"height":2}},{"id":"dbc2c70b-444d-41b9-9b80-e51c32a15ca1","block_type":"box","text":"$260,684 $0","page_number":27,"box":{"x":640,"y":483,"width":208,"height":11}},{"id":"2581e47a-be63-4feb-8aef-0603de0251e4","block_type":"box","text":"Fiscal Year Ended May 31, 2024. . . . . . . .","page_number":27,"box":{"x":70,"y":499,"width":292,"height":11}},{"id":"1f0aff6e-7f47-4b5d-bb6f-bd15cf0b9155","block_type":"box","text":"...........................","page_number":27,"box":{"x":369,"y":506,"width":213,"height":2}},{"id":"9c9d6e75-9488-4952-91ef-61dff9995fd0","block_type":"box","text":"$287,290 $0","page_number":27,"box":{"x":640,"y":498,"width":208,"height":11}},{"id":"859a92ec-c0e4-4e5c-86be-eb63570b45ec","block_type":"box","text":"The following table shows the dollar amount of brokerage commissions paid to brokers for providing Section","page_number":27,"box":{"x":101,"y":523,"width":770,"height":11}},{"id":"540225ce-5db8-4148-af03-2c5e2f9df463","block_type":"box","text":"28(e) research/brokerage services under Section 28(e) of the Securities Exchange Act of 1934, as amended, and","page_number":27,"box":{"x":69,"y":538,"width":814,"height":11}},{"id":"f5b5da7e-1249-4f65-9a88-2940fc16d8e6","block_type":"box","text":"the approximate dollar amount of the transactions involved for the fiscal year ended May 31, 2026. The provision of","page_number":27,"box":{"x":68,"y":553,"width":829,"height":11}},{"id":"a306abbd-be2d-4cc8-9fd0-f8c77e3dd150","block_type":"box","text":"Section 28(e) research/brokerage services was not necessarily a factor in the placement of all brokerage business","page_number":27,"box":{"x":69,"y":568,"width":822,"height":11}},{"id":"706264f8-bc9a-469a-b8f4-a29596ead016","block_type":"box","text":"with such brokers.","page_number":27,"box":{"x":68,"y":583,"width":130,"height":9}},{"id":"7353038e-3d9a-4273-8036-7228681d90d8","block_type":"box","text":"Amount of Commissions","page_number":27,"box":{"x":264,"y":611,"width":141,"height":8}},{"id":"796cf449-11f6-47b6-8e6a-ebc8d8439b93","block_type":"box","text":"Paid to Brokers for","page_number":27,"box":{"x":280,"y":622,"width":110,"height":7}},{"id":"2de7ff31-2dbc-4b3a-9235-763f8b36fe16","block_type":"box","text":"Providing 28(e) Eligible","page_number":27,"box":{"x":267,"y":632,"width":136,"height":9}},{"id":"97ac9e01-adb4-4b80-a8be-d8e8c210bd25","block_type":"box","text":"Research Services","page_number":27,"box":{"x":281,"y":642,"width":108,"height":7}},{"id":"32371e61-3cfa-479f-a049-6a88cfc0c6a6","block_type":"box","text":"Amount of Brokerage","page_number":27,"box":{"x":588,"y":632,"width":124,"height":9}},{"id":"4e68f8e3-fcc9-4f7e-acb6-b33020775881","block_type":"box","text":"Transactions Involved","page_number":27,"box":{"x":587,"y":642,"width":126,"height":7}},{"id":"4c9653ff-fc59-4e43-b2fd-102f31745c53","block_type":"box","text":"$73,007 $337,946,379","page_number":27,"box":{"x":304,"y":659,"width":400,"height":11}},{"id":"bf4ae5ac-c7a4-42b1-b4f8-ff76d5c31053","block_type":"box","text":"As of May 31, 2026, the value of the Fund’s aggregate holdings of the securities of its regular brokers or dealers","page_number":27,"box":{"x":101,"y":683,"width":807,"height":12}},{"id":"ca4ea3d0-0f36-420f-a1bb-4320ebab94a2","block_type":"box","text":"(as defined in Rule 10b-1 of the Investment Company Act), if any portion of such holdings were purchased during the","page_number":27,"box":{"x":69,"y":698,"width":832,"height":12}},{"id":"88599806-65c8-45f5-b36d-ea7e2ee22d16","block_type":"box","text":"fiscal year ended May 31, 2026 is as follows:","page_number":27,"box":{"x":68,"y":714,"width":326,"height":11}},{"id":"535ed799-1f8b-4692-8e0f-46bcd2afee44","block_type":"box","text":"Regular Broker/Dealer Debt (D)/Equity (E) Aggregate Holdings (000s)","page_number":27,"box":{"x":69,"y":742,"width":840,"height":9}},{"id":"bc6cfb43-be56-453a-8ea2-ddf35912dccc","block_type":"box","text":"Morgan Stanley & CO. LLC. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E $9,476","page_number":27,"box":{"x":70,"y":759,"width":786,"height":12}},{"id":"2aa711ea-c0e3-4fda-968d-f47c3bb28a44","block_type":"box","text":"Morgan Stanley & CO. LLC. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . D $8,100","page_number":27,"box":{"x":70,"y":774,"width":786,"height":12}},{"id":"ea0923a2-9e1a-4905-9f2c-b9d39bf96f23","block_type":"box","text":"BOFA Securities, Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E $8,344","page_number":27,"box":{"x":70,"y":789,"width":786,"height":11}},{"id":"fb25ef35-0d24-477e-8c9a-846271f3352c","block_type":"box","text":"BOFA Securities, Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . D $4,943","page_number":27,"box":{"x":70,"y":804,"width":786,"height":11}},{"id":"e46688a2-36d8-4b08-85ce-ccdc6fa8c185","block_type":"box","text":"J.P. Morgan Securities LLC . .","page_number":27,"box":{"x":69,"y":820,"width":209,"height":11}},{"id":"472fb37a-93da-4b54-a1cd-91b3f8f5d182","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . D $7,857","page_number":27,"box":{"x":284,"y":819,"width":572,"height":12}},{"id":"840b13f7-238b-445f-9d57-76d48dd355c3","block_type":"box","text":"J.P. Morgan Securities LLC . .","page_number":27,"box":{"x":69,"y":835,"width":209,"height":11}},{"id":"d2dea6b7-3ef8-46e6-a38e-e55d7bb1cc9c","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E $6,141","page_number":27,"box":{"x":284,"y":835,"width":572,"height":11}},{"id":"7dc54555-838a-4186-a1ac-c74f64542f47","block_type":"box","text":"Citigroup Global Markets, Inc. . . . . . . . . .","page_number":27,"box":{"x":69,"y":850,"width":282,"height":12}},{"id":"0c04734c-9045-4f66-b48d-ff346330e019","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . D $4,849","page_number":27,"box":{"x":357,"y":850,"width":499,"height":11}},{"id":"9bb5ac2d-6772-4830-a484-d4d8008ff374","block_type":"box","text":"Citigroup Global Markets, Inc. . . . . . . . . .","page_number":27,"box":{"x":69,"y":866,"width":282,"height":11}},{"id":"b3142900-64a6-49c2-bae8-00d9567d3b32","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . E $3,428","page_number":27,"box":{"x":357,"y":865,"width":499,"height":11}},{"id":"7ed0da3e-6712-4bcd-8504-2d03ed846ee3","block_type":"box","text":"Goldman Sachs & Co. LLC.","page_number":27,"box":{"x":69,"y":881,"width":192,"height":9}},{"id":"b230fd69-23b9-4c33-8e83-b114f534dd65","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . D $5,871","page_number":27,"box":{"x":268,"y":880,"width":588,"height":11}},{"id":"678bc1ae-4790-42da-a371-93c16a722842","block_type":"box","text":"Goldman Sachs & Co. LLC.","page_number":27,"box":{"x":69,"y":896,"width":192,"height":9}},{"id":"e7dbd192-fe67-465a-b2ca-1bf0e66efeb6","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E $3,226","page_number":27,"box":{"x":268,"y":895,"width":588,"height":11}},{"id":"90ce3418-10e4-42d9-85ec-1997f1b8eedd","block_type":"box","text":"I-25","page_number":27,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"760c9d1e-08fd-47c8-aed8-d85ab08a081e","block_type":"box","text":"NM0926U-5977317-27/232","page_number":27,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"14fa9b2d-5694-4023-9764-0bcf422983f6","block_type":"box","text":"Regular Broker/Dealer Debt (D)/Equity (E) Aggregate Holdings (000s)","page_number":28,"box":{"x":69,"y":49,"width":840,"height":9}},{"id":"56d6ac56-e287-43d5-a089-7934d15fa300","block_type":"box","text":"MacQuarie Capital (USA), Inc. . . . . . .","page_number":28,"box":{"x":70,"y":67,"width":256,"height":11}},{"id":"fb5aab9f-8ebc-4adc-867f-fdcbd15896b6","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E $4,506","page_number":28,"box":{"x":333,"y":66,"width":523,"height":11}},{"id":"0bae04bb-73ff-4819-860c-5d6dea5069dc","block_type":"box","text":"BNP Paribas Securities Corp. .","page_number":28,"box":{"x":70,"y":82,"width":216,"height":11}},{"id":"6d5751bb-6a44-410e-9134-a98fb1a99894","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E $2,655","page_number":28,"box":{"x":292,"y":81,"width":564,"height":11}},{"id":"ebc7e1e9-990b-4ea7-93f6-0ff0721e4351","block_type":"box","text":"Mizuho Securities USA LLC","page_number":28,"box":{"x":70,"y":97,"width":190,"height":9}},{"id":"d91400ff-b65d-4406-b5a3-e66ec5ca8814","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . D $2,199","page_number":28,"box":{"x":268,"y":96,"width":588,"height":11}},{"id":"88db2457-08f3-4fbe-86ad-c487cd3cb087","block_type":"box","text":"Credit Agricole Securities (USA), Inc. . . . .","page_number":28,"box":{"x":69,"y":112,"width":290,"height":11}},{"id":"87c6fbca-eeef-4ec5-88c1-3bf5742fe43e","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . E $1,636","page_number":28,"box":{"x":365,"y":111,"width":491,"height":12}},{"id":"5626a63d-9211-4db5-82e8-2de96685dadb","block_type":"box","text":"Barclays Capital, Inc.","page_number":28,"box":{"x":70,"y":127,"width":147,"height":11}},{"id":"36ccacdc-31b2-4b43-a1dd-3e52513e26a7","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E $ 578","page_number":28,"box":{"x":227,"y":126,"width":629,"height":11}},{"id":"ca393651-e979-409a-96c5-695caef06a2a","block_type":"box","text":"Barclays Capital, Inc.","page_number":28,"box":{"x":70,"y":142,"width":147,"height":11}},{"id":"e973be1c-cd0a-49c6-9dc3-a933d5e0f3de","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . D $ 406","page_number":28,"box":{"x":227,"y":142,"width":629,"height":10}},{"id":"7f550beb-f979-456c-a95d-1ae2bb6ef965","block_type":"box","text":"Securities Lending","page_number":28,"box":{"x":68,"y":174,"width":135,"height":11}},{"id":"70afe034-e597-4b46-b8a2-a4cec77b1017","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":28,"box":{"x":101,"y":197,"width":807,"height":11}},{"id":"6317a27f-9213-4b87-9879-0a4a0982221b","block_type":"box","text":"exemptive order from the Commission permitting it to lend portfolio securities to borrowers affiliated with the Fund","page_number":28,"box":{"x":69,"y":212,"width":817,"height":11}},{"id":"57a991fb-336b-4ebc-9502-073a1d44857b","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":28,"box":{"x":69,"y":227,"width":813,"height":11}},{"id":"2fee3300-84b1-40e7-8999-04dfaf37a091","block_type":"box","text":"lending, BlackRock Investment Management, LLC (“BIM”) acts as securities lending agent for the Fund subject to the","page_number":28,"box":{"x":70,"y":242,"width":834,"height":11}},{"id":"480d9e0b-0e5c-4ad5-a313-4717972af802","block_type":"box","text":"overall supervision of the Manager, pursuant to a written agreement (the “Securities Lending Agency Agreement”).","page_number":28,"box":{"x":69,"y":257,"width":813,"height":11}},{"id":"e7395aaa-cf17-4e11-9157-5bf35c587951","block_type":"box","text":"BIM administers the lending program in accordance with guidelines approved by the Board of Directors.","page_number":28,"box":{"x":70,"y":272,"width":734,"height":11}},{"id":"cd15a062-3893-4c91-ae71-ee12286d8faf","block_type":"box","text":"The Fund retains a portion of the securities lending income and remits the remaining portion to BIM as","page_number":28,"box":{"x":101,"y":295,"width":735,"height":11}},{"id":"790e4762-a5ab-4c9c-8df0-ceed7158313b","block_type":"box","text":"compensation for its services as securities lending agent. Securities lending income is generally equal to the total of","page_number":28,"box":{"x":69,"y":310,"width":834,"height":11}},{"id":"6742aa46-d58d-4c18-b0db-dc5e42392e44","block_type":"box","text":"income earned from the reinvestment of cash collateral (and excludes collateral investment fees as defined below),","page_number":28,"box":{"x":70,"y":325,"width":822,"height":11}},{"id":"bda69e2c-b0b1-4175-90d9-f5b64aaf7d9a","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":28,"box":{"x":69,"y":340,"width":787,"height":11}},{"id":"a443e243-1546-4481-b771-ef1344ab1175","block_type":"box","text":"operational costs directly related to securities lending. The Fund is responsible for fees in connection with the","page_number":28,"box":{"x":69,"y":355,"width":783,"height":11}},{"id":"cb37c2f8-baf1-4958-a52b-592a519b9186","block_type":"box","text":"investment of cash collateral received for securities on loan in a money market fund managed by BlackRock (the","page_number":28,"box":{"x":70,"y":370,"width":800,"height":12}},{"id":"f5377cf8-73ee-4b8b-9d07-a16a3a44bedd","block_type":"box","text":"“collateral investment fees”); however, the securities lending agent has agreed to reduce the amount of securities","page_number":28,"box":{"x":70,"y":385,"width":813,"height":12}},{"id":"7aaf50e0-88c5-4e8f-a020-93c34043243c","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":28,"box":{"x":70,"y":401,"width":836,"height":11}},{"id":"c2436b2a-c4b1-41bf-8bdd-cb2672d41d1c","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":28,"box":{"x":69,"y":416,"width":755,"height":11}},{"id":"63048d19-7225-4a6c-8bed-971b76432e57","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":28,"box":{"x":101,"y":438,"width":776,"height":12}},{"id":"030663bb-3049-47dd-9c9a-719d27aceb98","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":28,"box":{"x":69,"y":453,"width":831,"height":12}},{"id":"98a26661-7e9e-4c65-9573-b70df1f154ff","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":28,"box":{"x":68,"y":469,"width":812,"height":11}},{"id":"c1b6a751-e886-491b-9f04-781899fa15f2","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":28,"box":{"x":69,"y":484,"width":799,"height":11}},{"id":"abf06f98-c965-4b55-b5f3-e89d1b220816","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":28,"box":{"x":68,"y":499,"width":835,"height":11}},{"id":"c32db6c8-22fd-49fa-bdbc-6a536fab356d","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":28,"box":{"x":69,"y":514,"width":818,"height":11}},{"id":"164c68a7-f486-4d29-9de3-f9b257f1f79c","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":28,"box":{"x":68,"y":529,"width":789,"height":11}},{"id":"9f660f81-f858-4f67-aa44-e775480a8e66","block_type":"box","text":"making a good faith estimate of certain costs the money market fund would incur if it were to sell a pro rata amount","page_number":28,"box":{"x":69,"y":544,"width":829,"height":11}},{"id":"7d3ab006-2ed5-4032-a713-485cc74371b4","block_type":"box","text":"of each security in the portfolio to satisfy the amount of net redemptions on that day. There is no limit to the size of a","page_number":28,"box":{"x":69,"y":559,"width":839,"height":11}},{"id":"e355e8e5-fc71-4a09-a1c9-3d7a2d61069c","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":28,"box":{"x":69,"y":574,"width":802,"height":12}},{"id":"837c30f0-d4ff-4edb-9b3b-430370e2247c","block_type":"box","text":"portfolio security in good faith and supported by data, it is required to apply a default liquidity fee of 1% on the value","page_number":28,"box":{"x":70,"y":589,"width":830,"height":12}},{"id":"782f9bef-d159-4c78-a602-95d4659c6414","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":28,"box":{"x":69,"y":605,"width":838,"height":11}},{"id":"8b404e41-0647-444c-ad13-32fb09548566","block_type":"box","text":"Fund’s returns on securities lending.","page_number":28,"box":{"x":70,"y":620,"width":258,"height":11}},{"id":"d0bb8089-5435-4a69-8861-d753e5e409cb","block_type":"box","text":"Under the securities lending program, the Fund is categorized into one of several specific asset classes. The","page_number":28,"box":{"x":102,"y":642,"width":774,"height":12}},{"id":"d28c385d-f119-45db-978c-5508dd4233e6","block_type":"box","text":"determination of the Fund’s asset class category (fixed-income, domestic equity, international equity or fund of","page_number":28,"box":{"x":69,"y":658,"width":790,"height":11}},{"id":"c7b6094e-b009-4f23-be58-7450455c21d7","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":28,"box":{"x":68,"y":673,"width":809,"height":11}},{"id":"68d86cf4-fa22-44df-b96e-8aef006d1a25","block_type":"box","text":"Fund and BIM.","page_number":28,"box":{"x":70,"y":688,"width":100,"height":9}},{"id":"860afac9-26df-473a-8d2c-b6db2e840d67","block_type":"box","text":"Pursuant to the securities lending agreement effective January 1, 2026: (i) the Fund retains 82% of securities","page_number":28,"box":{"x":102,"y":710,"width":783,"height":12}},{"id":"f2c02c98-4342-4193-8d11-ff33e373086d","block_type":"box","text":"lending income (which excludes collateral investment fees); and (ii) this amount can never be less than 70% of the","page_number":28,"box":{"x":70,"y":726,"width":815,"height":11}},{"id":"8a3c7f2d-72c0-4172-9805-8b2c6f1d6335","block_type":"box","text":"sum of securities lending income plus collateral investment fees.","page_number":28,"box":{"x":69,"y":741,"width":463,"height":11}},{"id":"f62fba95-3ddd-4f49-b267-aa3346dffced","block_type":"box","text":"In addition, commencing the business day following the date that the aggregate securities lending income","page_number":28,"box":{"x":102,"y":763,"width":753,"height":12}},{"id":"8fa7ede0-480d-4bc0-935f-44c18ac51330","block_type":"box","text":"earned across the BlackRock Multi-Asset Complex in a calendar year exceeds specified thresholds, the Fund,","page_number":28,"box":{"x":69,"y":778,"width":778,"height":12}},{"id":"34de361b-4e03-4e34-abf1-493df8e08c81","block_type":"box","text":"pursuant to the current securities lending agreement, will receive for the remainder of that calendar year securities","page_number":28,"box":{"x":70,"y":794,"width":817,"height":11}},{"id":"9dc4f45a-74f7-475f-9e81-4f7f91daac09","block_type":"box","text":"lending income as follows: (i) 85% of securities lending income (which excludes collateral investment fees); and","page_number":28,"box":{"x":70,"y":809,"width":794,"height":11}},{"id":"a2f3c4fc-2fb5-4540-ae47-e81e4bc31a75","block_type":"box","text":"(ii) this amount can never be less than 70% of the sum of securities lending income plus collateral investment fees.","page_number":28,"box":{"x":69,"y":824,"width":825,"height":11}},{"id":"79497988-db0a-42e9-969d-0b8c01c1978c","block_type":"box","text":"Prior to January 1, 2026, the Fund was subject to the same securities lending fee arrangement.","page_number":28,"box":{"x":102,"y":846,"width":683,"height":12}},{"id":"6d0826bd-853d-45f3-be87-c0a5ba9018eb","block_type":"box","text":"I-26","page_number":28,"box":{"x":476,"y":943,"width":27,"height":9}},{"id":"db42b0de-d81f-48bc-8777-0dae3178792d","block_type":"box","text":"NM0926U-5977317-28/232","page_number":28,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"d94ed4f9-f8b6-4328-a9c2-664efe91f3a5","block_type":"box","text":"The services provided to the Fund by BIM, in the most recent fiscal year ended May 31, 2026 primarily included","page_number":29,"box":{"x":101,"y":45,"width":798,"height":11}},{"id":"7656cb8d-fab5-410e-b0f6-d93b015cb808","block_type":"box","text":"the following:","page_number":29,"box":{"x":68,"y":60,"width":93,"height":11}},{"id":"a285cf2a-f620-42ad-97dc-fec7dbd0a9d5","block_type":"box","text":"(1) selecting borrowers from an approved list of borrowers and executing a securities lending agreement as agent","page_number":29,"box":{"x":69,"y":80,"width":818,"height":11}},{"id":"dcb7d53f-7e80-4324-ace0-d7639a12f933","block_type":"box","text":"on behalf of the Fund with each such borrower;","page_number":29,"box":{"x":102,"y":95,"width":333,"height":11}},{"id":"61d7b2cd-a970-4b05-9255-c1a59e3ac203","block_type":"box","text":"(2) negotiating the terms of securities loans, including the amount of fees;","page_number":29,"box":{"x":69,"y":115,"width":538,"height":11}},{"id":"ed4dc9ae-d334-4867-86cb-3d4e9da83e1b","block_type":"box","text":"(3) directing the delivery of loaned securities;","page_number":29,"box":{"x":69,"y":135,"width":330,"height":12}},{"id":"22e76e57-e572-4404-be81-58974ca7caec","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":29,"box":{"x":69,"y":155,"width":834,"height":12}},{"id":"fddde464-f4c9-4bb7-874c-3a52cb3dabf0","block_type":"box","text":"of excess collateral, as necessary;","page_number":29,"box":{"x":102,"y":171,"width":246,"height":11}},{"id":"762caa11-03b6-49ad-87b8-a0088aa21f65","block_type":"box","text":"(5) investing cash collateral received in connection with any loaned securities;","page_number":29,"box":{"x":69,"y":191,"width":562,"height":11}},{"id":"c6bbb73d-04ac-49a3-9884-cfc295bdc4fc","block_type":"box","text":"(6) monitoring distributions on loaned securities (for example, interest and dividend activity);","page_number":29,"box":{"x":69,"y":211,"width":665,"height":11}},{"id":"9522c08e-0923-4d5d-85f7-aabf374eb296","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":29,"box":{"x":69,"y":231,"width":822,"height":11}},{"id":"dba2266b-8eb3-4222-9f3e-93198712911d","block_type":"box","text":"the liquidation of collateral to purchase replacement securities of the same issue, type, class and series as that","page_number":29,"box":{"x":101,"y":246,"width":803,"height":11}},{"id":"b4a3f0c5-1909-4758-aac7-8ebadb326113","block_type":"box","text":"of the loaned securities; and","page_number":29,"box":{"x":102,"y":261,"width":203,"height":11}},{"id":"ebcc940e-9acd-45da-8eee-595f37a3dff9","block_type":"box","text":"(8) terminating securities loans and arranging for the return of loaned securities to the Fund at loan termination.","page_number":29,"box":{"x":69,"y":281,"width":808,"height":12}},{"id":"579b19ab-af65-4a14-bf2b-a27e18f50204","block_type":"box","text":"The following table shows the dollar amounts of income and fees/compensation related to the securities lending","page_number":29,"box":{"x":101,"y":304,"width":805,"height":11}},{"id":"8ebba913-d939-4b26-ab84-22f1e6a0963f","block_type":"box","text":"activities of the Fund during its most recent fiscal year ended May 31, 2026.","page_number":29,"box":{"x":69,"y":319,"width":546,"height":12}},{"id":"d4637b4f-ec56-4c57-96ca-35c6707a663f","block_type":"box","text":"Gross income from securities lending activities","page_number":29,"box":{"x":69,"y":347,"width":343,"height":11}},{"id":"16fde9cd-ad05-463b-80da-d4cc05dc90c9","block_type":"box","text":"...................................................","page_number":29,"box":{"x":416,"y":354,"width":409,"height":2}},{"id":"dfc254b5-8fcb-4b7f-90dc-7e45f0f40e00","block_type":"box","text":"$79,245","page_number":29,"box":{"x":847,"y":346,"width":62,"height":12}},{"id":"37e49009-aac4-43db-b51e-c5812a08e0f2","block_type":"box","text":"Fees and/or compensation for securities lending activities and related services","page_number":29,"box":{"x":70,"y":366,"width":565,"height":12}},{"id":"4d11604a-7406-4813-a8f7-7295b859b2da","block_type":"box","text":"Securities lending income paid to BIM for services as securities lending agent . . . . .","page_number":29,"box":{"x":79,"y":382,"width":599,"height":11}},{"id":"e5271ef3-ab3c-4b62-abcb-05f42e948913","block_type":"box","text":". . . . . . . . . . . . . . . . . . $ 2,851","page_number":29,"box":{"x":685,"y":381,"width":224,"height":11}},{"id":"54ac3b37-989d-4b3c-b37d-a8054fe49a58","block_type":"box","text":"Cash collateral management expenses not included in securities lending income paid to BIM. .","page_number":29,"box":{"x":79,"y":397,"width":673,"height":11}},{"id":"80468ae6-af52-494b-9b95-61ba84eba70e","block_type":"box","text":". . . . . . . . . $ 711","page_number":29,"box":{"x":758,"y":396,"width":151,"height":11}},{"id":"a7c88a79-d0a0-4105-8756-28c99ef1936b","block_type":"box","text":"Administrative fees not included in securities lending income paid to BIM . . . .","page_number":29,"box":{"x":78,"y":412,"width":551,"height":11}},{"id":"8d46f2da-a70c-4b49-8002-fa7eb2f08d61","block_type":"box","text":"........................ $ 0","page_number":29,"box":{"x":636,"y":411,"width":273,"height":11}},{"id":"2b087e05-197d-45f0-9f0a-e94d1acb2256","block_type":"box","text":"Indemnification fees not included in securities lending income paid to BIM . . . . .","page_number":29,"box":{"x":79,"y":427,"width":567,"height":11}},{"id":"5357be86-5d07-4256-a7fb-27338a4c785d","block_type":"box","text":"...................... $ 0","page_number":29,"box":{"x":652,"y":426,"width":257,"height":11}},{"id":"467048fd-83ce-4bec-9957-6ad68e0bd161","block_type":"box","text":"Rebates (paid to borrowers) . . . . . . . . . . .","page_number":29,"box":{"x":79,"y":442,"width":289,"height":11}},{"id":"afd63532-95b9-48ad-8c06-06b9d739de67","block_type":"box","text":"........................................................","page_number":29,"box":{"x":375,"y":450,"width":450,"height":1}},{"id":"04acb7e6-ede5-4f87-8e77-f2def14bb091","block_type":"box","text":"$62,060","page_number":29,"box":{"x":847,"y":441,"width":62,"height":12}},{"id":"007ea943-25a8-4196-ab56-b84e83897325","block_type":"box","text":"Other fees not included in securities lending income paid to BIM. . . . . . . . . . .","page_number":29,"box":{"x":79,"y":457,"width":542,"height":12}},{"id":"e999e397-0743-499a-b810-6bc86a7a382a","block_type":"box","text":"......................... $ 0","page_number":29,"box":{"x":628,"y":457,"width":281,"height":10}},{"id":"fa7feb8e-c865-4323-8d51-641336adad4b","block_type":"box","text":"Aggregate fees/compensation for securities lending 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In each jurisdiction, nomenclature varies. 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Only information that","page_number":32,"box":{"x":69,"y":611,"width":840,"height":11}},{"id":"b6c7dd7d-b3d9-4adf-ab71-c8e471fcc115","block_type":"box","text":"is clearly identified as applicable to a Covered Fund is considered to form a part of that Covered Fund’s SAI.","page_number":32,"box":{"x":70,"y":626,"width":770,"height":11}},{"id":"cd008596-142c-4fb2-a2f4-d5c36cf7307d","block_type":"box","text":"Asset-Backed Securities.","page_number":32,"box":{"x":101,"y":649,"width":183,"height":9}},{"id":"327f7a26-e765-4d15-8117-b56310b6f599","block_type":"box","text":"Asset-backed securities are securities backed by home equity loans, installment sale","page_number":32,"box":{"x":290,"y":649,"width":607,"height":11}},{"id":"293b2921-3685-400f-9540-82acf141a9d4","block_type":"box","text":"contracts, credit card receivables or other assets. Asset-backed securities are “pass-through” securities, meaning","page_number":32,"box":{"x":69,"y":664,"width":814,"height":11}},{"id":"65c404ee-3a63-4e9c-8331-21b5ff579c14","block_type":"box","text":"that principal and interest payments — net of expenses — made by the borrower on the underlying assets (such as","page_number":32,"box":{"x":68,"y":679,"width":825,"height":11}},{"id":"fd696431-4f8b-49e9-8a84-bbbda629b9a6","block_type":"box","text":"credit card receivables) are passed through to a Fund. The value of asset-backed securities, like that of traditional","page_number":32,"box":{"x":69,"y":694,"width":813,"height":11}},{"id":"42afa53c-8bab-4b30-9c75-d690f5ade9fe","block_type":"box","text":"fixed-income securities, typically increases when interest rates fall and decreases when interest rates rise. However,","page_number":32,"box":{"x":68,"y":709,"width":830,"height":11}},{"id":"87a2f41c-2fd5-4b48-a1ea-40e25f18a568","block_type":"box","text":"asset-backed securities differ from traditional fixed-income securities because of their potential for prepayment. The","page_number":32,"box":{"x":69,"y":724,"width":827,"height":11}},{"id":"ef54bb6d-6419-483f-8ce1-a6f730d63d1d","block_type":"box","text":"price paid by a Fund for its asset-backed securities, the yield the Fund expects to receive from such securities and","page_number":32,"box":{"x":70,"y":739,"width":813,"height":12}},{"id":"38ae1d97-0da4-4573-b916-2a908c0b1d95","block_type":"box","text":"the average life of the securities are based on a number of factors, including the anticipated rate of prepayment of","page_number":32,"box":{"x":68,"y":755,"width":818,"height":11}},{"id":"45d11404-19a4-4fa6-a502-8725f92c35cb","block_type":"box","text":"the underlying assets. In a period of declining interest rates, borrowers may prepay the underlying assets more","page_number":32,"box":{"x":68,"y":770,"width":792,"height":11}},{"id":"da0676b8-0575-4311-a36e-b8763bea3e08","block_type":"box","text":"quickly than anticipated, thereby reducing the yield to maturity and the average life of the asset-backed securities.","page_number":32,"box":{"x":69,"y":785,"width":811,"height":11}},{"id":"34b42982-60f6-48cc-b995-2ab094b3d123","block_type":"box","text":"Moreover, when a Fund reinvests the proceeds of a prepayment in these circumstances, it will likely receive a rate of","page_number":32,"box":{"x":70,"y":800,"width":832,"height":11}},{"id":"342f0899-ee93-4a02-89d6-ff41ca09c3aa","block_type":"box","text":"interest that is lower than the rate on the security that was prepaid. To the extent that a Fund purchases asset","page_number":32,"box":{"x":70,"y":815,"width":792,"height":11}},{"id":"fce4f632-0d6b-4e4c-abbe-2c9ba8a18efa","block_type":"box","text":"backed securities at a premium, prepayments may result in a loss to the extent of the premium paid. If a Fund buys","page_number":32,"box":{"x":69,"y":830,"width":825,"height":11}},{"id":"878627cd-2e05-4d48-8416-3c3451293ebb","block_type":"box","text":"such securities at a discount, both scheduled payments and unscheduled prepayments will increase current and total","page_number":32,"box":{"x":69,"y":846,"width":838,"height":10}},{"id":"441c0f2d-6bd5-4684-997e-34c6ddc78332","block_type":"box","text":"returns and unscheduled prepayments will also accelerate the recognition of income which, when distributed to","page_number":32,"box":{"x":69,"y":860,"width":793,"height":12}},{"id":"430adea0-a7ff-415e-ae67-7f463fc5ebb1","block_type":"box","text":"shareholders, will be taxable as ordinary income. In a period of rising interest rates, prepayments of the underlying","page_number":32,"box":{"x":69,"y":875,"width":819,"height":12}},{"id":"f0ae6c94-5a89-41f6-93cb-2b7a44bcd6d7","block_type":"box","text":"assets may occur at a slower than expected rate, creating maturity extension risk. This particular risk may effectively","page_number":32,"box":{"x":69,"y":891,"width":834,"height":11}},{"id":"07253b1d-5df3-499b-a4c3-17665bddea2a","block_type":"box","text":"change a security that was considered short- or intermediate-term at the time of purchase into a longer term security.","page_number":32,"box":{"x":69,"y":906,"width":837,"height":11}},{"id":"555625c3-8630-4f7a-902a-f42ba2dfa42c","block_type":"box","text":"II-1","page_number":32,"box":{"x":478,"y":943,"width":23,"height":9}},{"id":"99621e80-f8c6-44d9-b850-de4599339e2d","block_type":"box","text":"NM0926U-5977317-32/232","page_number":32,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"510be3fa-f7ca-45e3-87ef-8dcbed5f5530","block_type":"box","text":"Since the value of longer-term securities generally fluctuates more widely in response to changes in interest rates","page_number":33,"box":{"x":69,"y":45,"width":810,"height":11}},{"id":"406a8129-b5e3-48fd-992b-1626fd2180f5","block_type":"box","text":"than does the value of shorter-term securities, maturity extension risk could increase the volatility of the Fund. When","page_number":33,"box":{"x":68,"y":60,"width":833,"height":11}},{"id":"71d2af8a-2eb5-4abb-bf82-bbac657d97b7","block_type":"box","text":"interest rates decline, the value of an asset-backed security with prepayment features may not increase as much as","page_number":33,"box":{"x":70,"y":75,"width":827,"height":11}},{"id":"35619c96-d3a6-43df-92b3-cf0d417dcba3","block_type":"box","text":"that of other fixed-income securities, and, as noted above, changes in market rates of interest may accelerate or","page_number":33,"box":{"x":68,"y":90,"width":805,"height":11}},{"id":"bd97f2d3-6eb1-43a8-b793-e7608c761696","block_type":"box","text":"retard prepayments and thus affect maturities.","page_number":33,"box":{"x":69,"y":105,"width":333,"height":11}},{"id":"5dd87b20-d971-463f-8021-f368a01b4e7a","block_type":"box","text":"Asset-Based Securities.","page_number":33,"box":{"x":101,"y":128,"width":173,"height":9}},{"id":"7f5bbe97-671b-4690-9747-57a76f5a9c58","block_type":"box","text":"Certain Funds may invest in debt, preferred or convertible securities, the principal","page_number":33,"box":{"x":281,"y":128,"width":582,"height":11}},{"id":"9b12773c-69b6-485a-9fd7-a4bb30380ad6","block_type":"box","text":"amount, redemption terms or conversion terms of which are related to the market price of some natural resource","page_number":33,"box":{"x":69,"y":143,"width":808,"height":11}},{"id":"3bcb02d0-e397-4b34-8840-822d8823bc65","block_type":"box","text":"asset such as gold bullion. These securities are referred to as “asset-based securities.” A Fund will purchase only","page_number":33,"box":{"x":69,"y":158,"width":815,"height":11}},{"id":"c18f12e7-1085-4296-861f-659120be0692","block_type":"box","text":"asset-based securities that are rated, or are issued by issuers that have outstanding debt obligations rated,","page_number":33,"box":{"x":69,"y":173,"width":769,"height":11}},{"id":"66941058-7860-4458-813a-c79c99a379d8","block_type":"box","text":"investment grade (for example, AAA, AA, A or BBB by S&P Global Ratings (“S&P”) or Fitch Ratings (“Fitch”), or Baa by","page_number":33,"box":{"x":70,"y":188,"width":833,"height":12}},{"id":"881b54f9-72c6-47c8-bc9c-7ba37a028827","block_type":"box","text":"Moody’s Investors Service, Inc. (“Moody’s”) or commercial paper rated A-1 by S&P or Prime-1 by Moody’s) or by","page_number":33,"box":{"x":70,"y":203,"width":795,"height":12}},{"id":"ca56b389-142d-49ea-a491-c6d59ee4c3cb","block_type":"box","text":"issuers that the Manager has determined to be of similar creditworthiness. Obligations ranked in the fourth highest","page_number":33,"box":{"x":70,"y":218,"width":824,"height":12}},{"id":"f352102c-281d-4350-a3aa-850cd5b3ced8","block_type":"box","text":"rating category, while considered “investment grade,” may have certain speculative characteristics and may be more","page_number":33,"box":{"x":69,"y":234,"width":832,"height":11}},{"id":"d577b73f-a896-4bb4-9f68-bff666749ed9","block_type":"box","text":"likely to be downgraded than securities rated in the three highest rating categories. If an asset-based security is","page_number":33,"box":{"x":70,"y":249,"width":797,"height":11}},{"id":"fdfc75ca-3231-4bd4-ac70-0de6a4ce8efa","block_type":"box","text":"backed by a bank letter of credit or other similar facility, the Manager may take such backing into account in","page_number":33,"box":{"x":69,"y":264,"width":768,"height":11}},{"id":"deae80d1-c066-4cf3-af1c-3803efe02be0","block_type":"box","text":"determining the creditworthiness of the issuer. While the market prices for an asset-based security and the related","page_number":33,"box":{"x":69,"y":279,"width":819,"height":11}},{"id":"efd253ed-e09d-4491-afd9-8118a1f22454","block_type":"box","text":"natural resource asset generally are expected to move in the same direction, there may not be perfect correlation in","page_number":33,"box":{"x":69,"y":294,"width":829,"height":11}},{"id":"5b35e1ec-ef5a-4935-b458-78a1837ae99f","block_type":"box","text":"the two price movements. Asset-based securities may not be secured by a security interest in or claim on the","page_number":33,"box":{"x":68,"y":309,"width":780,"height":11}},{"id":"4e071ae6-5336-4ab8-990e-67835e4e03e1","block_type":"box","text":"underlying natural resource asset. The asset-based securities in which a Fund may invest may bear interest or pay","page_number":33,"box":{"x":69,"y":325,"width":815,"height":11}},{"id":"eb7b4a97-ed1c-4b07-b0b9-509fca87a76a","block_type":"box","text":"preferred dividends at below market (or even relatively nominal) rates. Certain asset-based securities may be payable","page_number":33,"box":{"x":70,"y":339,"width":837,"height":12}},{"id":"668e1c19-7f99-4d1f-8f74-691c09e28d35","block_type":"box","text":"at maturity in cash at the stated principal amount or, at the option of the holder, directly in a stated amount of the","page_number":33,"box":{"x":69,"y":355,"width":812,"height":11}},{"id":"47e1883b-d9ff-405c-8599-1c07162fc242","block_type":"box","text":"asset to which it is related. In such instance, because no Fund presently intends to invest directly in natural resource","page_number":33,"box":{"x":69,"y":370,"width":836,"height":11}},{"id":"e5de4fe1-4e07-427a-8fd7-c4eec774c790","block_type":"box","text":"assets, a Fund would sell the asset-based security in the secondary market, to the extent one exists, prior to","page_number":33,"box":{"x":69,"y":385,"width":778,"height":11}},{"id":"0e4dd954-9ae9-4be0-9cf2-bb21acc190b6","block_type":"box","text":"maturity if the value of the stated amount of the asset exceeds the stated principal amount and thereby realize the","page_number":33,"box":{"x":69,"y":400,"width":819,"height":11}},{"id":"31e3c051-a329-461a-bfe0-4c5079a13308","block_type":"box","text":"appreciation in the underlying asset.","page_number":33,"box":{"x":69,"y":415,"width":258,"height":11}},{"id":"21b313be-e380-4f84-9742-36a90b35830b","block_type":"box","text":"Precious Metal-Related Securities.","page_number":33,"box":{"x":102,"y":438,"width":243,"height":9}},{"id":"45645cf8-78cc-4d0b-8dd9-d76170801297","block_type":"box","text":"A Fund may invest in the equity and other securities of companies that","page_number":33,"box":{"x":351,"y":438,"width":503,"height":11}},{"id":"35d323e3-bc91-4707-aeb2-d7d2b0ebc4bc","block_type":"box","text":"explore for, extract, process or deal in precious metals (","page_number":33,"box":{"x":69,"y":453,"width":398,"height":11}},{"id":"97c792dd-082e-4ade-9e33-e1676e546bc2","block_type":"box","text":"e.g.","page_number":33,"box":{"x":469,"y":454,"width":25,"height":10}},{"id":"618ce4a8-9754-44dd-a93f-6f1e74484fae","block_type":"box","text":", gold, silver and platinum), and in asset-based securities","page_number":33,"box":{"x":497,"y":453,"width":407,"height":11}},{"id":"385c21a0-41ce-4d87-9713-b44c3187f6d6","block_type":"box","text":"indexed to the value of such metals. Such securities may be purchased when they are believed to be attractively","page_number":33,"box":{"x":70,"y":468,"width":801,"height":11}},{"id":"598a527a-38d7-43e3-b40e-62a0b4cd1ae5","block_type":"box","text":"priced in relation to the value of a company’s precious metal-related assets or when the values of precious metals","page_number":33,"box":{"x":70,"y":483,"width":815,"height":11}},{"id":"94ed9182-4a27-41e7-ab59-454090a91605","block_type":"box","text":"are expected to benefit from inflationary pressure or other economic, political or financial uncertainty or instability.","page_number":33,"box":{"x":69,"y":498,"width":815,"height":11}},{"id":"13f95cfa-57ac-424d-8a37-b7755c2a2a44","block_type":"box","text":"Based on historical experience, during periods of economic or financial instability the securities of companies","page_number":33,"box":{"x":70,"y":513,"width":779,"height":12}},{"id":"0779dab2-e112-4be2-b816-6aa88e3c3dc6","block_type":"box","text":"involved in precious metals may be subject to extreme price fluctuations, reflecting the high volatility of precious","page_number":33,"box":{"x":70,"y":528,"width":799,"height":12}},{"id":"cdb1e18a-9374-4c56-b460-4cb3d51ec835","block_type":"box","text":"metal prices during such periods. In addition, the instability of precious metal prices may result in volatile earnings of","page_number":33,"box":{"x":69,"y":543,"width":838,"height":12}},{"id":"536f4504-d5c5-4d03-a020-b92360828006","block_type":"box","text":"precious metal-related companies, which may, in turn, adversely affect the financial condition of such companies. The","page_number":33,"box":{"x":70,"y":559,"width":838,"height":11}},{"id":"e1e41738-1713-4026-b823-0b7c4870723f","block_type":"box","text":"major producers of gold include the Republic of South Africa, Russia, Canada, the United States, Brazil and Australia.","page_number":33,"box":{"x":69,"y":574,"width":835,"height":11}},{"id":"3482a759-7f34-4b3e-a4f2-4c26690bcc77","block_type":"box","text":"Sales of gold by Russia are largely unpredictable and often relate to political and economic considerations rather","page_number":33,"box":{"x":69,"y":589,"width":806,"height":11}},{"id":"6f8582f3-dc91-4578-a5da-49942934ce12","block_type":"box","text":"than to market forces. Economic, financial, social and political factors within South Africa may significantly affect","page_number":33,"box":{"x":68,"y":604,"width":805,"height":11}},{"id":"f7f99bab-4861-42d0-97f1-1b4e5a25df4f","block_type":"box","text":"South African gold production.","page_number":33,"box":{"x":69,"y":619,"width":213,"height":11}},{"id":"1258e70b-c1b8-4cb0-b980-9f0aca9f9592","block_type":"box","text":"Borrowing and Leverage.","page_number":33,"box":{"x":102,"y":642,"width":179,"height":11}},{"id":"da2b29ab-8e6a-4a8e-a145-f9553a5a5ec5","block_type":"box","text":"Each Fund may borrow as a temporary measure for extraordinary or emergency","page_number":33,"box":{"x":288,"y":642,"width":563,"height":11}},{"id":"41b49488-4f34-498f-8442-44118cc89294","block_type":"box","text":"purposes, including to meet redemptions or to settle securities transactions. Certain Funds will not purchase","page_number":33,"box":{"x":70,"y":657,"width":777,"height":11}},{"id":"f76ee8c2-2460-4cf8-a7c8-73e9410b6b30","block_type":"box","text":"securities at any time when borrowings exceed 5% of their total assets, except (a) to honor prior commitments or","page_number":33,"box":{"x":69,"y":672,"width":806,"height":11}},{"id":"c371704a-7b6b-4195-a2b2-15461ebfacd1","block_type":"box","text":"(b) to exercise subscription rights when outstanding borrowings have been obtained exclusively for settlements of","page_number":33,"box":{"x":69,"y":687,"width":810,"height":11}},{"id":"7096ce30-c0ba-48ea-ad61-4ad9b58a8e8d","block_type":"box","text":"other securities transactions.","page_number":33,"box":{"x":69,"y":703,"width":207,"height":8}},{"id":"e0f56b69-be17-423a-ae8d-bdbe2ad22651","block_type":"box","text":"Certain Funds may also borrow in order to make investments, to the extent disclosed in such Fund’s Prospectus.","page_number":33,"box":{"x":102,"y":725,"width":806,"height":11}},{"id":"c60eba81-da66-4205-83e0-3b2b5b63016c","block_type":"box","text":"The purchase of securities while borrowings are outstanding will have the effect of leveraging the Fund. Such","page_number":33,"box":{"x":68,"y":740,"width":776,"height":11}},{"id":"05cebed2-30ee-4968-b378-0850023e8df7","block_type":"box","text":"leveraging increases the Fund’s exposure to capital risk, and borrowed funds are subject to interest costs that will","page_number":33,"box":{"x":70,"y":755,"width":813,"height":11}},{"id":"6f3bf8cd-f948-4fa9-b6b0-72e85515f74e","block_type":"box","text":"reduce net income. The use of leverage by a Fund creates an opportunity for greater total return, but, at the same","page_number":33,"box":{"x":69,"y":770,"width":813,"height":12}},{"id":"dc99c570-0744-452e-b757-5a67e0a48923","block_type":"box","text":"time, creates special risks. For example, leveraging may exaggerate changes in the net asset value (“NAV”) of Fund","page_number":33,"box":{"x":68,"y":785,"width":823,"height":12}},{"id":"ebebd8ae-5835-429e-95c5-45666f90342e","block_type":"box","text":"shares and in the yield on the Fund’s portfolio. Although the principal of such borrowings will be fixed, the Fund’s","page_number":33,"box":{"x":69,"y":801,"width":806,"height":11}},{"id":"9fdfaf75-a263-4767-965b-7157158b1701","block_type":"box","text":"assets may change in value during the time the borrowings are outstanding. Borrowings will create interest expenses","page_number":33,"box":{"x":69,"y":816,"width":835,"height":11}},{"id":"d9980115-4556-4624-ba23-6c213306510c","block_type":"box","text":"for the Fund that can exceed the income from the assets purchased with the borrowings. To the extent the income or","page_number":33,"box":{"x":68,"y":831,"width":835,"height":11}},{"id":"c7ef636e-8dcf-4f0b-b4ff-967c8eb15699","block_type":"box","text":"capital appreciation derived from securities purchased with borrowed funds exceeds the interest the Fund will have to","page_number":33,"box":{"x":69,"y":846,"width":838,"height":11}},{"id":"6dcbfa26-9006-49af-a1bc-0675dca2d3e9","block_type":"box","text":"pay on the borrowings, the Fund’s return will be greater than if leverage had not been used. Conversely, if the income","page_number":33,"box":{"x":70,"y":861,"width":835,"height":11}},{"id":"59f07699-8560-4443-a346-f8c1e04b9d8d","block_type":"box","text":"or capital appreciation from the securities purchased with such borrowed funds is not sufficient to cover the cost of","page_number":33,"box":{"x":69,"y":876,"width":825,"height":11}},{"id":"58138034-5128-46f7-86fb-f997d6684345","block_type":"box","text":"borrowing, the return to the Fund will be less than if leverage had not been used and, therefore, the amount available","page_number":33,"box":{"x":69,"y":891,"width":837,"height":12}},{"id":"1e282e7e-3105-4991-bb38-ca37c6f04d52","block_type":"box","text":"for distribution to shareholders as dividends will be reduced. In the latter case, the Manager in its best judgment","page_number":33,"box":{"x":68,"y":906,"width":805,"height":12}},{"id":"876e9a37-fb25-4f54-8b57-2be27dd44494","block_type":"box","text":"II-2","page_number":33,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"5bd4c3d2-0566-425a-b8f0-0bd1081932d7","block_type":"box","text":"NM0926U-5977317-33/232","page_number":33,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"cd1cbb24-9786-4065-bf3b-8cda38b8bda3","block_type":"box","text":"nevertheless may determine to maintain the Fund’s leveraged position if it expects that the benefits to the Fund’s","page_number":34,"box":{"x":69,"y":45,"width":813,"height":11}},{"id":"e3517fa5-fffb-4ff6-8adc-7e5f51c94844","block_type":"box","text":"shareholders of maintaining the leveraged position will outweigh the current reduced return.","page_number":34,"box":{"x":69,"y":60,"width":653,"height":11}},{"id":"157a05f0-9d7d-4457-bd8e-7fad03df5ab6","block_type":"box","text":"Certain types of borrowings by a Fund may result in the Fund being subject to covenants in credit agreements","page_number":34,"box":{"x":102,"y":82,"width":780,"height":12}},{"id":"042c3fc5-98c7-47f4-a8ec-6ca3bb8fcf18","block_type":"box","text":"relating to asset coverage, portfolio composition requirements and other matters. It is not anticipated that","page_number":34,"box":{"x":69,"y":98,"width":759,"height":11}},{"id":"fd014ccd-2b4f-484a-9550-752aa70527ca","block_type":"box","text":"observance of such covenants would impede the Manager from managing a Fund’s portfolio in accordance with the","page_number":34,"box":{"x":69,"y":113,"width":822,"height":11}},{"id":"03189b88-5a04-4f73-aa9f-f9326ab49c76","block_type":"box","text":"Fund’s investment objectives and policies. However, a breach of any such covenants not cured within the specified","page_number":34,"box":{"x":70,"y":128,"width":816,"height":11}},{"id":"234dca35-7a2f-4226-b83d-3257e7974425","block_type":"box","text":"cure period may result in acceleration of outstanding indebtedness and require the Fund to dispose of portfolio","page_number":34,"box":{"x":69,"y":143,"width":792,"height":11}},{"id":"c15cbd08-53de-4e19-971b-df95fbcf140f","block_type":"box","text":"investments at a time when it may be disadvantageous to do so.","page_number":34,"box":{"x":70,"y":158,"width":459,"height":11}},{"id":"75aaf9d6-5156-4ab6-9f69-b9c039bcc532","block_type":"box","text":"Each Fund may at times borrow from affiliates of the Manager, provided that the terms of such borrowings are","page_number":34,"box":{"x":102,"y":181,"width":786,"height":11}},{"id":"ecdc860d-7b08-4f56-9d50-38811bf17903","block_type":"box","text":"no less favorable than those available from comparable sources of funds in the marketplace.","page_number":34,"box":{"x":69,"y":196,"width":663,"height":11}},{"id":"745913e7-8f34-4008-854b-8b6648eea715","block_type":"box","text":"Cash Management.","page_number":34,"box":{"x":102,"y":219,"width":140,"height":11}},{"id":"a980056a-c3d3-43b4-8a77-5b13c6c9d855","block_type":"box","text":"Generally, the Manager will employ futures and options on futures to provide liquidity","page_number":34,"box":{"x":249,"y":218,"width":603,"height":12}},{"id":"afe6d316-48a6-4403-a54d-5891f8837d4c","block_type":"box","text":"necessary to meet anticipated redemptions or for day-to-day operating purposes. However, if considered appropriate","page_number":34,"box":{"x":69,"y":234,"width":828,"height":11}},{"id":"86c97590-a0f5-4436-a5cc-7d5199d2a88b","block_type":"box","text":"in the opinion of the Manager, a portion of a Fund’s assets may be invested in certain types of instruments with","page_number":34,"box":{"x":70,"y":249,"width":799,"height":11}},{"id":"c4242556-09c4-4f45-bc46-6c1cb778d1e6","block_type":"box","text":"remaining maturities of 397 days or less for liquidity purposes. Such instruments would consist of: (i) obligations of","page_number":34,"box":{"x":69,"y":264,"width":826,"height":11}},{"id":"975c8971-25d2-4f2c-a86d-19914e7fe180","block_type":"box","text":"the U.S. Government, its agencies, instrumentalities, authorities or political subdivisions (“U.S. Government","page_number":34,"box":{"x":68,"y":279,"width":772,"height":11}},{"id":"68223bbe-e65f-4b44-9d6b-3d8408011d99","block_type":"box","text":"Securities”); (ii) other fixed-income securities rated Aa or higher by Moody’s or AA or higher by S&P or, if unrated, of","page_number":34,"box":{"x":69,"y":294,"width":823,"height":11}},{"id":"cd257e0c-c053-41c6-911c-9c00095276c3","block_type":"box","text":"comparable quality in the opinion of the Manager; (iii) commercial paper; (iv) bank obligations, including negotiable","page_number":34,"box":{"x":69,"y":309,"width":816,"height":11}},{"id":"66c4afd1-4a92-4cd9-aef5-dff0868666a1","block_type":"box","text":"certificates of deposit, time deposits and bankers’ acceptances; and (v) repurchase agreements. At the time the","page_number":34,"box":{"x":69,"y":324,"width":804,"height":12}},{"id":"fd5af33d-c8f2-4c3b-802b-c335131a9825","block_type":"box","text":"Fund invests in commercial paper, bank obligations or repurchase agreements, the issuer or the issuer’s parent must","page_number":34,"box":{"x":70,"y":340,"width":839,"height":11}},{"id":"3b456c3b-272b-4a1d-b4c2-57c22e68bb2b","block_type":"box","text":"have outstanding debt rated Aa or higher by Moody’s or AA or higher by S&P or outstanding commercial paper, bank","page_number":34,"box":{"x":69,"y":355,"width":824,"height":11}},{"id":"304c03b7-e98c-44dd-ace7-ea2db1502914","block_type":"box","text":"obligations or other short-term obligations rated Prime-1 by Moody’s or A-1 by S&P; or, if no such ratings are","page_number":34,"box":{"x":69,"y":370,"width":771,"height":11}},{"id":"74fb33bb-00e3-4775-997c-8800f76bc5c2","block_type":"box","text":"available, the instrument must be of comparable quality in the opinion of the Manager. For more information on","page_number":34,"box":{"x":69,"y":385,"width":793,"height":11}},{"id":"bea87d21-a364-457d-9afa-00b36cc34e97","block_type":"box","text":"money market instruments, see “Money Market Securities” below.","page_number":34,"box":{"x":69,"y":400,"width":472,"height":11}},{"id":"974170ea-faab-4d5f-b7fd-fda19622bb23","block_type":"box","text":"Collateralized Debt Obligations.","page_number":34,"box":{"x":102,"y":423,"width":229,"height":11}},{"id":"e9ed5bd7-541b-4ed2-9ba0-d4a2f72871b0","block_type":"box","text":"Certain Funds may invest in collateralized debt obligations (“CDOs”), which","page_number":34,"box":{"x":337,"y":423,"width":534,"height":11}},{"id":"1ad60e73-5010-48c1-b321-6150277293b0","block_type":"box","text":"include collateralized bond obligations (“CBOs”), collateralized loan obligations (“CLOs”) and other similarly","page_number":34,"box":{"x":70,"y":438,"width":764,"height":11}},{"id":"5d39dfdf-74cc-48a5-8af1-5e9a8c20c049","block_type":"box","text":"structured securities. CDOs are types of asset-backed securities. A CBO is ordinarily issued by a trust or other","page_number":34,"box":{"x":69,"y":453,"width":787,"height":11}},{"id":"b5fdb5eb-0cb1-4b45-b3b0-e9ebf4d0db48","block_type":"box","text":"special purpose entity (“SPE”) and is typically backed by a diversified pool of fixed-income securities (which may","page_number":34,"box":{"x":69,"y":468,"width":797,"height":11}},{"id":"720f3893-8e4e-4fff-9a94-2461c8576f61","block_type":"box","text":"include high risk, below investment grade securities) held by such issuer. A CLO is ordinarily issued by a trust or","page_number":34,"box":{"x":70,"y":483,"width":798,"height":11}},{"id":"020eac27-ae55-4264-a607-bb2d53c797fd","block_type":"box","text":"other SPE and is typically collateralized by a pool of loans, which may include, among others, domestic and non-U.S.","page_number":34,"box":{"x":69,"y":498,"width":827,"height":11}},{"id":"f14702aa-ff28-4494-895f-e7882c3f9cc8","block_type":"box","text":"senior secured loans, senior unsecured loans, and subordinate corporate loans, including loans that may be rated","page_number":34,"box":{"x":69,"y":514,"width":814,"height":11}},{"id":"556e4fc6-6edb-40f7-9c58-f5e5632459e3","block_type":"box","text":"below investment grade or equivalent unrated loans, held by such issuer. Investments in a CLO organized outside of","page_number":34,"box":{"x":69,"y":528,"width":828,"height":12}},{"id":"251ce7e8-d9cc-4c68-8550-b3e29cde3c41","block_type":"box","text":"the United States may not be deemed to be foreign securities if the CLO is collateralized by a pool of loans, a","page_number":34,"box":{"x":68,"y":543,"width":782,"height":12}},{"id":"46034d70-da83-46d8-bac9-ac2ef15681bc","block_type":"box","text":"substantial portion of which are U.S. loans. Although certain CDOs may benefit from credit enhancement in the form","page_number":34,"box":{"x":69,"y":559,"width":830,"height":11}},{"id":"f462c329-0601-40fa-951a-e8d55d634ac7","block_type":"box","text":"of a senior-subordinate structure, over-collateralization or bond insurance, such enhancement may not always be","page_number":34,"box":{"x":69,"y":574,"width":803,"height":11}},{"id":"6ecf51c6-a61c-41f3-a6a6-dbbdf14c8bd7","block_type":"box","text":"present, and may fail to protect a Fund against the risk of loss on default of the collateral. Certain CDO issuers may","page_number":34,"box":{"x":70,"y":589,"width":827,"height":11}},{"id":"2fb4e45b-df59-41a3-b41a-2d23acde843a","block_type":"box","text":"use derivatives contracts to create “synthetic” exposure to assets rather than holding such assets directly, which","page_number":34,"box":{"x":69,"y":604,"width":807,"height":11}},{"id":"c72ecc76-7053-47fd-9be1-165f5840c4dd","block_type":"box","text":"entails the risks of derivative instruments described elsewhere in this SAI. CDOs may charge management fees and","page_number":34,"box":{"x":69,"y":619,"width":826,"height":11}},{"id":"3855a40a-392a-42d4-a21d-ea431a47b34f","block_type":"box","text":"administrative expenses, which are in addition to those of a Fund.","page_number":34,"box":{"x":69,"y":634,"width":469,"height":11}},{"id":"ca6f4d30-5eea-44c1-b8e4-2c6178b3bb52","block_type":"box","text":"For both CBOs and CLOs, the cash flows from the SPE are split into two or more portions, called tranches,","page_number":34,"box":{"x":102,"y":657,"width":758,"height":11}},{"id":"eda23582-441e-4c9b-95a1-d2faeac40671","block_type":"box","text":"varying in risk and yield. The riskiest portion is the “equity” tranche, which bears the first loss from defaults from the","page_number":34,"box":{"x":68,"y":672,"width":836,"height":11}},{"id":"04576a36-6415-4ade-ac6b-ec5074f7f30c","block_type":"box","text":"bonds or loans in the SPE and serves to protect the other, more senior tranches from default (though such protection","page_number":34,"box":{"x":69,"y":687,"width":838,"height":11}},{"id":"c774d07e-1727-4323-8358-91ccdad71920","block_type":"box","text":"is not complete). Since it is partially protected from defaults, a senior tranche from a CBO or CLO typically has higher","page_number":34,"box":{"x":70,"y":702,"width":835,"height":12}},{"id":"4eccf7a6-b528-4fa4-82cc-bed335393f04","block_type":"box","text":"ratings and lower yields than its underlying securities, and may be rated investment grade. Despite the protection","page_number":34,"box":{"x":69,"y":718,"width":808,"height":11}},{"id":"b3d44706-720d-4e5c-8881-a8ff72ba990f","block_type":"box","text":"from the equity tranche, CBO or CLO tranches can experience substantial losses due to actual defaults, downgrades","page_number":34,"box":{"x":68,"y":732,"width":830,"height":12}},{"id":"d5032121-b2a8-4974-a441-4ec7f2e9cb6a","block_type":"box","text":"of the underlying collateral by rating agencies, forced liquidation of the collateral pool due to a failure of coverage","page_number":34,"box":{"x":69,"y":748,"width":806,"height":11}},{"id":"9f308489-e11b-4ffe-b9e1-8e8e1960aaf7","block_type":"box","text":"tests, increased sensitivity to defaults due to collateral default and disappearance of protecting tranches, market","page_number":34,"box":{"x":68,"y":763,"width":809,"height":11}},{"id":"aceefb60-ce8c-47c8-b904-b4fda179d4e8","block_type":"box","text":"anticipation of defaults as well as investor aversion to CBO or CLO securities as a class. Interest on certain tranches","page_number":34,"box":{"x":69,"y":778,"width":835,"height":11}},{"id":"9270055a-21c0-418e-a7c9-d40871fd38d2","block_type":"box","text":"of a CDO may be paid in kind or deferred and capitalized (paid in the form of obligations of the same type rather than","page_number":34,"box":{"x":69,"y":793,"width":835,"height":11}},{"id":"75bf9f7a-db98-4143-b427-7a5b68700a34","block_type":"box","text":"cash), which involves continued exposure to default risk with respect to such payments.","page_number":34,"box":{"x":69,"y":808,"width":625,"height":11}},{"id":"c97afa53-6df2-46ed-92e1-7b71ce3b5cbf","block_type":"box","text":"The risks of an investment in a CDO depend largely on the type of the collateral securities and the class of the","page_number":34,"box":{"x":101,"y":831,"width":789,"height":11}},{"id":"0f492354-35c7-4aaa-baab-a9c3c840999c","block_type":"box","text":"CDO in which a Fund invests. Normally, CBOs, CLOs and other CDOs are privately offered and sold, and thus are not","page_number":34,"box":{"x":69,"y":846,"width":830,"height":11}},{"id":"0be1e14e-4c01-485a-a8d8-dd5a1d68dfd5","block_type":"box","text":"registered under the securities laws. However, an active dealer market may exist for CDOs, allowing a CDO to qualify","page_number":34,"box":{"x":69,"y":861,"width":830,"height":11}},{"id":"93469942-ae29-4e84-912b-861bee456935","block_type":"box","text":"for Rule 144A transactions. In addition to the normal risks associated with fixed-income securities and asset-backed","page_number":34,"box":{"x":68,"y":876,"width":831,"height":9}},{"id":"eaa9108d-5c00-48b9-b1b3-73a239fc8c2f","block_type":"box","text":"securities generally discussed elsewhere in this SAI, CDOs carry additional risks including, but not limited to: (i) the","page_number":34,"box":{"x":69,"y":891,"width":824,"height":12}},{"id":"55aca582-a1b9-4037-9ffd-69ecd3a8c4fd","block_type":"box","text":"possibility that distributions from collateral securities will not be adequate to make interest or other payments; (ii) the","page_number":34,"box":{"x":70,"y":906,"width":838,"height":12}},{"id":"1c04a475-25f4-4e3f-83d2-f005a6239e22","block_type":"box","text":"II-3","page_number":34,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"e994dbfc-c8ad-4c29-8dc7-1b390e784d89","block_type":"box","text":"NM0926U-5977317-34/232","page_number":34,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"1e332b49-18af-4ceb-97ce-13ac33b22fae","block_type":"box","text":"risk that the collateral may default or decline in value or be downgraded, if rated by a nationally recognized statistical","page_number":35,"box":{"x":69,"y":45,"width":832,"height":11}},{"id":"fe8d2db4-778a-4bb4-af30-e4f78e5695f0","block_type":"box","text":"rating organization (“NRSRO”); (iii) a Fund may invest in tranches of CDOs that are subordinate to other tranches;","page_number":35,"box":{"x":69,"y":60,"width":807,"height":11}},{"id":"4a6ae458-2b31-4ba0-a9e8-6101b39c3ebc","block_type":"box","text":"(iv) the structure and complexity of the transaction and the legal documents could lead to disputes among investors","page_number":35,"box":{"x":69,"y":75,"width":826,"height":11}},{"id":"8e3ba8bf-1841-422d-bcb5-6d688ffb0e11","block_type":"box","text":"regarding the characterization of proceeds; (v) the investment return achieved by the Fund could be significantly","page_number":35,"box":{"x":69,"y":90,"width":795,"height":11}},{"id":"6e8a6fd0-f3ea-44ca-a6e5-4656be28f720","block_type":"box","text":"different than those predicted by financial models; (vi) the lack of a readily available secondary market for CDOs;","page_number":35,"box":{"x":69,"y":105,"width":804,"height":11}},{"id":"fc02af65-3c8b-4db6-b7a5-93b70d25c882","block_type":"box","text":"(vii) the risk of forced “fire sale” liquidation due to technical defaults such as coverage test failures; and (viii) the","page_number":35,"box":{"x":69,"y":120,"width":805,"height":12}},{"id":"00b9c24e-9c08-463b-888b-dc031923f691","block_type":"box","text":"CDO’s manager may perform poorly.","page_number":35,"box":{"x":69,"y":135,"width":257,"height":12}},{"id":"4953b265-d719-4189-ab6a-12f2a9771b8d","block_type":"box","text":"Commercial Paper.","page_number":35,"box":{"x":102,"y":158,"width":136,"height":11}},{"id":"cbb4c351-2476-484a-b2bb-3a105173da56","block_type":"box","text":"Certain Funds may purchase commercial paper. Commercial paper purchasable by each","page_number":35,"box":{"x":244,"y":158,"width":626,"height":11}},{"id":"4326075a-479e-41f7-93a2-a902fa37dabb","block_type":"box","text":"Fund includes “Section 4(a)(2) paper,” a term that includes debt obligations issued in reliance on the “private","page_number":35,"box":{"x":70,"y":173,"width":781,"height":11}},{"id":"cef71c1b-3013-4c22-b260-753a373c433c","block_type":"box","text":"placement” exemption from registration afforded by Section 4(a)(2) of the Securities Act. Section 4(a)(2) paper is","page_number":35,"box":{"x":70,"y":188,"width":806,"height":12}},{"id":"6f94a2af-b4af-41f8-ac66-e4b75656e3b8","block_type":"box","text":"restricted as to disposition under the Federal securities laws, and is frequently sold (and resold) to institutional","page_number":35,"box":{"x":69,"y":203,"width":792,"height":12}},{"id":"f43dd671-2c38-4e58-bf83-8176ca87d114","block_type":"box","text":"investors such as the Fund through or with the assistance of investment dealers who make a market in the Section","page_number":35,"box":{"x":70,"y":218,"width":820,"height":12}},{"id":"5891d487-3b04-4e51-8d17-4887b54f4f3b","block_type":"box","text":"4(a)(2) paper, thereby providing liquidity. Certain transactions in Section 4(a)(2) paper may qualify for the registration","page_number":35,"box":{"x":69,"y":234,"width":831,"height":11}},{"id":"7177c229-a20b-4018-99ce-0cd3838b1f78","block_type":"box","text":"exemption provided in Rule 144A under the Securities Act. Most Funds can purchase commercial paper rated (at the","page_number":35,"box":{"x":69,"y":249,"width":831,"height":11}},{"id":"c8f9ed57-7bfd-43ab-81c3-57c6f57e8179","block_type":"box","text":"time of purchase) “A-1” by S&P or “Prime-1” by Moody’s or when deemed advisable by a Fund’s Manager or sub","page_number":35,"box":{"x":68,"y":264,"width":805,"height":11}},{"id":"4e02e4fb-d12c-4147-8f45-d91506668b0d","block_type":"box","text":"adviser, “high quality” issues rated “A-2”, “Prime-2” or “F-2” by S&P, Moody’s or Fitch, respectively.","page_number":35,"box":{"x":69,"y":279,"width":707,"height":11}},{"id":"9a117262-68b5-4644-9dcd-1f3b8404276c","block_type":"box","text":"Commercial paper is generally considered to be short-term unsecured debt of corporations. Like all fixed income","page_number":35,"box":{"x":102,"y":302,"width":801,"height":11}},{"id":"e9e886a5-ca6a-4673-9426-a04e24f6294b","block_type":"box","text":"securities, commercial paper prices are susceptible to fluctuations in interest rates. If interest rates rise, commercial","page_number":35,"box":{"x":69,"y":317,"width":836,"height":11}},{"id":"8e950346-aea1-4a81-8752-09d81a54a2e3","block_type":"box","text":"paper prices will decline and vice versa. However, the short-term nature of a commercial paper investment generally","page_number":35,"box":{"x":70,"y":332,"width":826,"height":11}},{"id":"ac03fa54-bc10-46f7-baa7-765f63f3d6d9","block_type":"box","text":"makes it less susceptible to volatility than many other fixed income securities because interest rate risk typically","page_number":35,"box":{"x":69,"y":347,"width":803,"height":11}},{"id":"59f432a6-530b-4070-92d9-7a30714fb437","block_type":"box","text":"increases as maturity lengths increase. Commercial paper tends to yield smaller returns than longer-term corporate","page_number":35,"box":{"x":70,"y":362,"width":822,"height":11}},{"id":"94e8bc43-d93a-4808-be8f-6bcdd0bf19b2","block_type":"box","text":"debt because securities with shorter maturities typically have lower effective yields than those with longer maturities.","page_number":35,"box":{"x":69,"y":377,"width":835,"height":12}},{"id":"a2b3b532-cea1-446b-9516-c7bfef87a2ba","block_type":"box","text":"Commodity-Linked Derivative Instruments and Hybrid Instruments.","page_number":35,"box":{"x":102,"y":400,"width":483,"height":11}},{"id":"707b6191-bbc3-4a4e-b12e-2b69856a3faf","block_type":"box","text":"Certain Funds seek to gain exposure to the","page_number":35,"box":{"x":591,"y":400,"width":308,"height":11}},{"id":"f612190e-14f9-4d0b-ace6-454482a7d323","block_type":"box","text":"commodities markets primarily through investments in hybrid instruments. Hybrid instruments are either equity or","page_number":35,"box":{"x":69,"y":415,"width":809,"height":11}},{"id":"d65999c6-0f37-4863-a056-084a92c6ec72","block_type":"box","text":"debt derivative securities with one or more commodity-dependent components that have payment features similar to","page_number":35,"box":{"x":69,"y":430,"width":828,"height":11}},{"id":"316ec0f0-9e46-450b-a2b4-0165f0171e99","block_type":"box","text":"a commodity futures contract, a commodity option contract, or a combination of both. Therefore, these instruments","page_number":35,"box":{"x":69,"y":445,"width":822,"height":11}},{"id":"4aef07f3-3316-4006-939d-a282156759e4","block_type":"box","text":"are “commodity-linked.” They are considered “hybrid” instruments because they have both commodity-like and","page_number":35,"box":{"x":69,"y":461,"width":787,"height":11}},{"id":"717721ca-0023-4c70-a803-6fffdad3b454","block_type":"box","text":"security-like characteristics. Hybrid instruments are derivative instruments because at least part of their value is","page_number":35,"box":{"x":69,"y":475,"width":801,"height":12}},{"id":"e7cdbe94-4911-4909-9a71-a2c77b7dc7fc","block_type":"box","text":"derived from the value of an underlying commodity, futures contract, index or other readily measurable economic","page_number":35,"box":{"x":69,"y":491,"width":800,"height":11}},{"id":"4ba0b130-32d1-4e7f-8d2b-1a3109017f1c","block_type":"box","text":"variable.","page_number":35,"box":{"x":68,"y":506,"width":59,"height":9}},{"id":"0d8f2f50-5cc2-4104-a5c1-bdcc3fb21066","block_type":"box","text":"The prices of commodity-linked derivative instruments may move in different directions than investments in","page_number":35,"box":{"x":101,"y":528,"width":763,"height":12}},{"id":"31b13e69-4e3c-4d65-aaaf-0e081bd96d95","block_type":"box","text":"traditional equity and debt securities when the value of those traditional securities is declining due to adverse","page_number":35,"box":{"x":68,"y":543,"width":783,"height":12}},{"id":"b3d967b0-af3c-4f0c-82e5-5d4118593ecc","block_type":"box","text":"economic conditions. As an example, during periods of rising inflation, debt securities have historically tended to","page_number":35,"box":{"x":69,"y":559,"width":802,"height":11}},{"id":"62ef5c21-834e-4336-8eca-c3a2eee8f8ea","block_type":"box","text":"decline in value due to the general increase in prevailing interest rates. Conversely, during those same periods of","page_number":35,"box":{"x":69,"y":574,"width":808,"height":11}},{"id":"5f643b27-5f5f-4d94-b4fb-526b608bb587","block_type":"box","text":"rising inflation, the prices of certain commodities, such as oil and metals, have historically tended to increase. Of","page_number":35,"box":{"x":69,"y":589,"width":811,"height":11}},{"id":"e74ec94b-0d3b-495d-99b5-50cbfe3000eb","block_type":"box","text":"course, there cannot be any guarantee that these investments will perform in that manner in the future, and at","page_number":35,"box":{"x":69,"y":604,"width":791,"height":11}},{"id":"579c5e40-4462-4a13-99b7-e90b4b996ae9","block_type":"box","text":"certain times the price movements of commodity-linked instruments have been parallel to those of debt and equity","page_number":35,"box":{"x":69,"y":619,"width":819,"height":11}},{"id":"10301440-c9cc-43b1-a8b1-48841e71f930","block_type":"box","text":"securities. Commodities have historically tended to increase and decrease in value during different parts of the","page_number":35,"box":{"x":69,"y":634,"width":795,"height":12}},{"id":"45874cbc-60ef-4e2e-9854-d6f2729e4d52","block_type":"box","text":"business cycle than financial assets. Nevertheless, at various times, commodities prices may move in tandem with","page_number":35,"box":{"x":69,"y":649,"width":822,"height":12}},{"id":"24308ba4-a372-4549-ab5b-efb62aa84243","block_type":"box","text":"the prices of financial assets and thus may not provide overall portfolio diversification benefits. Under favorable","page_number":35,"box":{"x":68,"y":664,"width":797,"height":12}},{"id":"17e6f7d0-9bfa-41c3-85ee-7343f5a4cbd7","block_type":"box","text":"economic conditions, the Fund’s investments may be expected to under-perform an investment in traditional","page_number":35,"box":{"x":69,"y":680,"width":772,"height":11}},{"id":"054f4c32-0d85-4fe2-8402-343c3a309850","block_type":"box","text":"securities. Over the long term, the returns on the Fund’s investments are expected to exhibit low or negative","page_number":35,"box":{"x":69,"y":695,"width":773,"height":11}},{"id":"04d3b156-2f67-4feb-b7de-f3855804e53d","block_type":"box","text":"correlation with stocks and bonds.","page_number":35,"box":{"x":69,"y":710,"width":244,"height":9}},{"id":"400a1f3e-46a5-4e7d-a281-6fe00e4ab01e","block_type":"box","text":"Qualifying Hybrid Instruments.","page_number":35,"box":{"x":102,"y":732,"width":212,"height":12}},{"id":"25381d27-e535-48f6-ae54-e38c36b32966","block_type":"box","text":"Certain Funds may invest in hybrid instruments that qualify for exclusion from","page_number":35,"box":{"x":320,"y":732,"width":552,"height":12}},{"id":"3b18088e-870b-4faf-962e-3890a254f634","block_type":"box","text":"regulation under the Commodity Exchange Act and the regulations adopted thereunder. A hybrid instrument that","page_number":35,"box":{"x":69,"y":748,"width":795,"height":11}},{"id":"47275bf7-8268-4360-8820-2c86b11f8284","block_type":"box","text":"qualifies for this exclusion from regulation must be “predominantly a security.” A hybrid instrument is considered to","page_number":35,"box":{"x":69,"y":763,"width":822,"height":11}},{"id":"65571b03-1c77-4aa3-b800-133d43469424","block_type":"box","text":"be predominantly a security if (a) the issuer of the hybrid instrument receives payment in full of the purchase price of","page_number":35,"box":{"x":69,"y":778,"width":834,"height":11}},{"id":"d332a554-7e00-4a2c-8663-10461b24083a","block_type":"box","text":"the hybrid instrument, substantially contemporaneously with delivery of the hybrid instrument; (b) the purchaser or","page_number":35,"box":{"x":68,"y":793,"width":816,"height":11}},{"id":"06b18afd-3fd8-48ab-8508-14d96dba75f9","block_type":"box","text":"holder of the hybrid instrument is not required to make any payment to the issuer in addition to the purchase price","page_number":35,"box":{"x":69,"y":808,"width":817,"height":11}},{"id":"abe20b60-bc7e-4aa8-9660-ce25691c3e2a","block_type":"box","text":"paid under subparagraph (a), whether as margin, settlement payment, or otherwise, during the life of the hybrid","page_number":35,"box":{"x":70,"y":823,"width":793,"height":12}},{"id":"44988589-8210-491e-80b5-08baa7597377","block_type":"box","text":"instrument or at maturity; (c) the issuer of the hybrid instrument is not subject by the terms of the instrument to","page_number":35,"box":{"x":70,"y":838,"width":798,"height":11}},{"id":"96d36af1-6d58-42cc-909f-5b0e81cf052e","block_type":"box","text":"mark-to-market margining requirements; and (d) the hybrid instrument is not marketed as a contract of sale of a","page_number":35,"box":{"x":69,"y":853,"width":797,"height":12}},{"id":"2ec11d58-629e-4003-bcc0-bac18dfbce87","block_type":"box","text":"commodity for future delivery (or option on such a contract) subject to applicable provisions of the Commodity","page_number":35,"box":{"x":69,"y":869,"width":783,"height":11}},{"id":"a2953d66-c783-4012-a611-c32aa13d0624","block_type":"box","text":"Exchange Act. Hybrid instruments may be principal protected, partially protected, or offer no principal protection. A","page_number":35,"box":{"x":70,"y":884,"width":816,"height":11}},{"id":"d85872fc-6a36-4eb1-849b-e493e1db8170","block_type":"box","text":"principal protected hybrid instrument means that the issuer will pay, at a minimum, the par value of the note at","page_number":35,"box":{"x":70,"y":899,"width":791,"height":11}},{"id":"00bb5923-9458-4ee0-8c76-62315750b5a7","block_type":"box","text":"II-4","page_number":35,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"21384601-4fbd-49dc-a6a0-7d7a69b7abf9","block_type":"box","text":"NM0926U-5977317-35/232","page_number":35,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"c33159c0-9aa0-442f-ad71-18266b2aa6ce","block_type":"box","text":"maturity. Therefore, if the commodity value to which the hybrid instrument is linked declines over the life of the note,","page_number":36,"box":{"x":69,"y":45,"width":829,"height":11}},{"id":"af00f845-e497-4d20-a7bc-ac19b6dc63de","block_type":"box","text":"the Fund will receive at maturity the face or stated value of the note. With a principal protected hybrid instrument, the","page_number":36,"box":{"x":68,"y":60,"width":837,"height":11}},{"id":"9c5927c5-b9d5-48df-a32a-50f396c9678a","block_type":"box","text":"Fund will receive at maturity the greater of the par value of the note or the increase in its value based on the","page_number":36,"box":{"x":70,"y":75,"width":772,"height":11}},{"id":"f311311d-799e-464e-82ae-3ca57ff1a8c3","block_type":"box","text":"underlying commodity or index. This protection is, in effect, an option whose value is subject to the volatility and price","page_number":36,"box":{"x":69,"y":90,"width":839,"height":11}},{"id":"db9a24df-0807-4789-a952-0077a024092b","block_type":"box","text":"level of the underlying commodity. The Manager’s decision whether to use principal protection depends in part on the","page_number":36,"box":{"x":70,"y":105,"width":835,"height":11}},{"id":"df28bd10-9c7a-4d0d-9abf-d46cc6cd1430","block_type":"box","text":"cost of the protection. In addition, the protection feature depends upon the ability of the issuer to meet its obligation","page_number":36,"box":{"x":69,"y":120,"width":833,"height":12}},{"id":"1b360511-d70e-48e6-8344-0ebf79132a84","block_type":"box","text":"to buy back the security, and, therefore, depends on the creditworthiness of the issuer. With full principal protection,","page_number":36,"box":{"x":68,"y":135,"width":831,"height":11}},{"id":"af985404-b938-45b7-bcd3-0f151ffe6099","block_type":"box","text":"the Fund will receive at maturity of the hybrid instrument either the stated par value of the hybrid instrument, or","page_number":36,"box":{"x":68,"y":150,"width":795,"height":12}},{"id":"6a30be7b-38a9-4549-9536-92b6605c206d","block_type":"box","text":"potentially, an amount greater than the stated par value if the underlying commodity, index, futures contract or","page_number":36,"box":{"x":70,"y":166,"width":784,"height":11}},{"id":"a5253cb1-ea19-4b7c-bb27-8e3548f31def","block_type":"box","text":"economic variable to which the hybrid instrument is linked has increased in value. Partially protected hybrid","page_number":36,"box":{"x":69,"y":181,"width":765,"height":11}},{"id":"ee8676a5-76c9-4c3d-96f1-937f02498f0f","block_type":"box","text":"instruments may suffer some loss of principal if the underlying commodity, index, futures contract or economic","page_number":36,"box":{"x":70,"y":196,"width":788,"height":11}},{"id":"76430a33-c45f-4db4-aabc-3d17dbac4312","block_type":"box","text":"variable to which the hybrid instrument is linked declines in value during the term of the hybrid instrument. However,","page_number":36,"box":{"x":68,"y":211,"width":828,"height":11}},{"id":"56f51d5f-8707-449d-bbae-5131b95b2f06","block_type":"box","text":"partially protected hybrid instruments have a specified limit as to the amount of principal that they may lose.","page_number":36,"box":{"x":70,"y":226,"width":773,"height":11}},{"id":"318b1b62-d447-40da-a1ef-7e7c543033a8","block_type":"box","text":"Hybrid Instruments Without Principal Protection.","page_number":36,"box":{"x":102,"y":249,"width":339,"height":11}},{"id":"22e83927-e759-4f89-a9d0-1ebca51f91ef","block_type":"box","text":"Certain Funds may invest in hybrid instruments that offer no","page_number":36,"box":{"x":448,"y":249,"width":429,"height":11}},{"id":"cd827eb6-5e79-4bbf-b893-ad3e12df0f24","block_type":"box","text":"principal protection. At maturity, there is a risk that the underlying commodity price, futures contract, index or other","page_number":36,"box":{"x":70,"y":264,"width":818,"height":11}},{"id":"0c1c04f7-1eef-4d36-992b-10495bdda5a1","block_type":"box","text":"economic variable may have declined sufficiently in value such that some or all of the face value of the hybrid","page_number":36,"box":{"x":69,"y":279,"width":780,"height":11}},{"id":"f2ff226b-974a-4a8a-a4d1-b48e116c5393","block_type":"box","text":"instrument might not be returned. The Manager, at its discretion, may invest in a partially protected principal","page_number":36,"box":{"x":70,"y":294,"width":773,"height":11}},{"id":"5669962e-29a6-4017-914c-5ac0407ea600","block_type":"box","text":"structured note or a note without principal protection. In deciding to purchase a note without principal protection, the","page_number":36,"box":{"x":69,"y":309,"width":832,"height":11}},{"id":"88e47598-d569-42b2-906c-a0459df59092","block_type":"box","text":"Manager may consider, among other things, the expected performance of the underlying commodity futures contract,","page_number":36,"box":{"x":70,"y":324,"width":831,"height":12}},{"id":"810d7b7c-7a6a-4d56-961f-09013a619b66","block_type":"box","text":"index or other economic variable over the term of the note, the cost of the note, and any other economic factors that","page_number":36,"box":{"x":70,"y":339,"width":831,"height":12}},{"id":"fc0e8928-4db1-43e2-8f56-503876828da8","block_type":"box","text":"the Manager believes are relevant.","page_number":36,"box":{"x":68,"y":355,"width":247,"height":11}},{"id":"ee2a8d5f-e180-4a62-88fd-5b3442a3b992","block_type":"box","text":"Limitations on Leverage.","page_number":36,"box":{"x":102,"y":377,"width":173,"height":12}},{"id":"02d64f70-5ad9-46e8-85c1-c1693d58b3d3","block_type":"box","text":"Some of the hybrid instruments in which a Fund may invest may involve leverage. To","page_number":36,"box":{"x":281,"y":377,"width":598,"height":12}},{"id":"f5f0d3ed-4ce5-447f-b3eb-1f1579e3b0aa","block_type":"box","text":"avoid being subject to undue leverage risk, a Fund will seek to limit the amount of economic leverage it has under any","page_number":36,"box":{"x":69,"y":392,"width":840,"height":12}},{"id":"e6967d56-970e-4798-bbdf-f435619420b2","block_type":"box","text":"one hybrid instrument that it buys and the leverage of the Fund’s overall portfolio. A Fund will not invest in a hybrid","page_number":36,"box":{"x":69,"y":407,"width":816,"height":12}},{"id":"89c84145-222d-4fe8-bae7-2c681859ff2f","block_type":"box","text":"instrument if, at the time of purchase: (i) that instrument’s “leverage ratio” exceeds 300% of the price increase in","page_number":36,"box":{"x":70,"y":423,"width":812,"height":11}},{"id":"3178c17f-19c8-42f4-93b2-f19a3c519052","block_type":"box","text":"the underlying commodity, futures contract, index or other economic variable or (ii) the Fund’s “portfolio leverage","page_number":36,"box":{"x":68,"y":438,"width":803,"height":11}},{"id":"5451f6e3-c9ea-4979-ab67-c1bb8c86d497","block_type":"box","text":"ratio” exceeds 150%, measured at the time of purchase. “Leverage ratio” is the expected increase in the value of a","page_number":36,"box":{"x":69,"y":453,"width":826,"height":11}},{"id":"2b46f97e-d172-4886-b4a1-e665b54ae395","block_type":"box","text":"hybrid instrument, assuming a one percent price increase in the underlying commodity, futures contract, index or","page_number":36,"box":{"x":69,"y":468,"width":803,"height":11}},{"id":"1a61dc46-9193-48df-89b6-f98f0b30c49e","block_type":"box","text":"other economic factor. In other words, for a hybrid instrument with a leverage factor of 150%, a 1% gain in the","page_number":36,"box":{"x":69,"y":483,"width":783,"height":11}},{"id":"34803bd3-7e21-40d9-b0ee-2be77ef7fa10","block_type":"box","text":"underlying economic variable would be expected to result in a 1.5% gain in value for the hybrid instrument.","page_number":36,"box":{"x":69,"y":498,"width":758,"height":11}},{"id":"ec45bf51-28b1-4a37-9178-aef5a0f84b8e","block_type":"box","text":"Conversely, a hybrid instrument with a leverage factor of 150% would suffer a 1.5% loss if the underlying economic","page_number":36,"box":{"x":69,"y":513,"width":818,"height":12}},{"id":"cf76060b-f685-4627-a5e3-1838909c304e","block_type":"box","text":"variable lost 1% of its value. “Portfolio leverage ratio” is defined as the average (mean) leverage ratio of all","page_number":36,"box":{"x":68,"y":528,"width":763,"height":12}},{"id":"eded2e3e-c5f7-42ea-8870-f302e20f39c6","block_type":"box","text":"instruments in a Fund’s portfolio, weighted by the market values of such instruments or, in the case of futures","page_number":36,"box":{"x":70,"y":543,"width":787,"height":12}},{"id":"c0084804-6585-45f5-b017-75cace72fee5","block_type":"box","text":"contracts, their notional values. A Fund may at times or from time to time decide not to use leverage in its","page_number":36,"box":{"x":69,"y":559,"width":757,"height":11}},{"id":"8f66a070-719a-4bc1-837b-38444f27d297","block_type":"box","text":"investments or use less leverage than may otherwise be allowable.","page_number":36,"box":{"x":70,"y":574,"width":477,"height":11}},{"id":"984a24fc-5c7e-44dc-b5a5-e2fd61238ed5","block_type":"box","text":"Counterpar ty Risk.","page_number":36,"box":{"x":102,"y":597,"width":130,"height":11}},{"id":"f78fcdad-fe83-4c25-a448-208d82dc5323","block_type":"box","text":"A significant risk of hybrid instruments is counterparty risk. Unlike exchange-traded futures","page_number":36,"box":{"x":238,"y":596,"width":646,"height":12}},{"id":"25039931-7374-4a5e-8f8a-d7948e499414","block_type":"box","text":"and options, which are standard contracts, hybrid instruments are customized securities, tailor-made by a specific","page_number":36,"box":{"x":69,"y":612,"width":813,"height":11}},{"id":"584ad213-dbba-47d1-91bc-f5734044607d","block_type":"box","text":"issuer. With a listed futures or options contract, an investor’s counterparty is the exchange clearinghouse. Exchange","page_number":36,"box":{"x":70,"y":627,"width":829,"height":11}},{"id":"982e22ab-fabb-43c3-a572-0430f32dc396","block_type":"box","text":"clearinghouses are capitalized by the exchange members and typically have high investment grade ratings (","page_number":36,"box":{"x":69,"y":642,"width":763,"height":11}},{"id":"7f777665-064b-41f0-a1b8-6a7b510f53f9","block_type":"box","text":"e.g.","page_number":36,"box":{"x":834,"y":643,"width":25,"height":10}},{"id":"71ec6f6c-02e8-4ada-9423-4db3e409b777","block_type":"box","text":",","page_number":36,"box":{"x":861,"y":649,"width":2,"height":3}},{"id":"acb2313d-73e0-4cd0-b4e5-310ecd542f8a","block_type":"box","text":"ratings of AAA or AA by S&P). Therefore, the risk is small that an exchange clearinghouse might be unable to meet its","page_number":36,"box":{"x":69,"y":657,"width":836,"height":11}},{"id":"fcdfb195-632a-4e71-8e0d-35cfbf5832f9","block_type":"box","text":"obligations at maturity. However, with a hybrid instrument, a Fund will take on the counterparty credit risk of the","page_number":36,"box":{"x":69,"y":672,"width":795,"height":11}},{"id":"45e99236-22f9-4fb7-b7f4-95c210248c12","block_type":"box","text":"issuer. That is, at maturity of the hybrid instrument, there is a risk that the issuer may be unable to perform its","page_number":36,"box":{"x":70,"y":687,"width":791,"height":11}},{"id":"85f58ce3-32d2-4fd9-80c9-37ba1c98abc1","block_type":"box","text":"obligations under the structured note.","page_number":36,"box":{"x":69,"y":703,"width":268,"height":11}},{"id":"482b369e-3494-4173-a6f6-1949b465225d","block_type":"box","text":"Convertible Securities.","page_number":36,"box":{"x":102,"y":725,"width":165,"height":9}},{"id":"7924d372-ff63-469b-8744-e1101228426f","block_type":"box","text":"A convertible security is a bond, debenture, note, preferred stock or other security that","page_number":36,"box":{"x":273,"y":725,"width":619,"height":11}},{"id":"f7108cea-7c14-4862-a9e2-4be4c72fe09a","block_type":"box","text":"may be converted into or exchanged for a prescribed amount of common stock or other equity security of the same or","page_number":36,"box":{"x":69,"y":740,"width":839,"height":11}},{"id":"d0a3b4dc-bdbd-4b6a-aea5-040e84e4e7b5","block_type":"box","text":"a different issuer within a particular period of time at a specified price or formula. A convertible security entitles the","page_number":36,"box":{"x":69,"y":755,"width":826,"height":11}},{"id":"212bc62f-871b-4dee-9db4-54ca08ca8f9b","block_type":"box","text":"holder to receive interest paid or accrued on debt or the dividend paid on preferred stock until the convertible","page_number":36,"box":{"x":69,"y":770,"width":781,"height":11}},{"id":"b54927a9-fc78-4895-ae95-72d2e025e10e","block_type":"box","text":"security matures or is redeemed, converted or exchanged. Before conversion, convertible securities have","page_number":36,"box":{"x":69,"y":785,"width":750,"height":12}},{"id":"7c32fa82-2c5a-4271-9cc1-ea5966f80c72","block_type":"box","text":"characteristics similar to nonconvertible income securities in that they ordinarily provide a stable stream of income","page_number":36,"box":{"x":69,"y":801,"width":819,"height":11}},{"id":"393ab8b9-f15d-46fd-a80d-231f68fc8794","block_type":"box","text":"with generally higher yields than those of common stocks of the same or similar issuers, but lower yields than","page_number":36,"box":{"x":68,"y":816,"width":784,"height":11}},{"id":"ef9a99a5-0057-4e62-bc49-f1e752ecce33","block_type":"box","text":"comparable nonconvertible securities. The value of a convertible security is influenced by changes in interest rates,","page_number":36,"box":{"x":69,"y":831,"width":823,"height":11}},{"id":"1fdd9506-c4d9-4908-97b6-e8c5c5f18927","block_type":"box","text":"with investment value declining as interest rates increase and increasing as interest rates decline. The credit","page_number":36,"box":{"x":68,"y":846,"width":780,"height":11}},{"id":"49e85c1a-e9a5-4e54-948a-e5be4bc30f55","block_type":"box","text":"standing of the issuer and other factors also may have an effect on the convertible security’s investment value.","page_number":36,"box":{"x":69,"y":861,"width":795,"height":11}},{"id":"7cacb430-75e5-443e-9973-49e491385e03","block_type":"box","text":"Convertible securities rank senior to common stock in a corporation’s capital structure but are usually subordinated","page_number":36,"box":{"x":69,"y":876,"width":826,"height":11}},{"id":"19deb3aa-60be-4e10-b959-80a7aaa43ad5","block_type":"box","text":"to comparable nonconvertible securities. Convertible securities may be subject to redemption at the option of the","page_number":36,"box":{"x":68,"y":891,"width":811,"height":11}},{"id":"d5a0fb08-59e8-48df-8efd-a1dbac48f3f8","block_type":"box","text":"issuer at a price established in the convertible security’s governing instrument.","page_number":36,"box":{"x":70,"y":907,"width":563,"height":11}},{"id":"3bf3451f-8064-4506-8959-3e08474f21b4","block_type":"box","text":"II-5","page_number":36,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"f30c1711-272d-44e6-845e-95bcdda30d57","block_type":"box","text":"NM0926U-5977317-36/232","page_number":36,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"5d06ff09-c5e3-4aad-909b-cfde718440bd","block_type":"box","text":"The characteristics of convertible securities make them potentially attractive investments for an investment","page_number":37,"box":{"x":101,"y":45,"width":767,"height":11}},{"id":"18231869-142e-4306-b365-5cef3e0b2c29","block_type":"box","text":"company seeking a high total return from capital appreciation and investment income. These characteristics include","page_number":37,"box":{"x":69,"y":60,"width":826,"height":11}},{"id":"4fb594e5-b267-4b3e-99c2-79fe45a62848","block_type":"box","text":"the potential for capital appreciation as the value of the underlying common stock increases, the relatively high yield","page_number":37,"box":{"x":68,"y":75,"width":829,"height":11}},{"id":"8f8122f3-7845-4417-a221-539665eb478c","block_type":"box","text":"received from dividend or interest payments as compared to common stock dividends and decreased risks of decline","page_number":37,"box":{"x":69,"y":90,"width":834,"height":11}},{"id":"f01897b7-4328-4270-a18a-45d8e4673645","block_type":"box","text":"in value relative to the underlying common stock due to their fixed-income nature. As a result of the conversion","page_number":37,"box":{"x":70,"y":105,"width":788,"height":11}},{"id":"6ad2a886-0858-44a6-9fc1-a96e8ae2e07f","block_type":"box","text":"feature, however, the interest rate or dividend preference on a convertible security is generally less than would be the","page_number":37,"box":{"x":68,"y":120,"width":839,"height":12}},{"id":"479043e9-e15d-47f1-afe6-ea4f95d64aa0","block_type":"box","text":"case if the securities were issued in nonconvertible form.","page_number":37,"box":{"x":69,"y":135,"width":409,"height":9}},{"id":"19a0511d-4c59-4770-9ab6-8160f7dd5adb","block_type":"box","text":"In analyzing convertible securities, the Manager will consider both the yield on the convertible security relative to","page_number":37,"box":{"x":102,"y":158,"width":802,"height":11}},{"id":"c8cbf9bb-075c-491d-8a56-2236a0cb7a99","block_type":"box","text":"its credit quality and the potential capital appreciation that is offered by the underlying common stock, among other","page_number":37,"box":{"x":70,"y":173,"width":824,"height":11}},{"id":"7cef832d-5832-4103-af40-5860dcb14124","block_type":"box","text":"things.","page_number":37,"box":{"x":68,"y":188,"width":47,"height":12}},{"id":"0775367b-00f4-421d-b9b2-3c9ce40c76d3","block_type":"box","text":"Convertible securities are issued and traded in a number of securities markets. Even in cases where a","page_number":37,"box":{"x":102,"y":211,"width":731,"height":9}},{"id":"3f902566-0edd-435b-8ded-4ed5745e1cb0","block_type":"box","text":"substantial portion of the convertible securities held by a Fund are denominated in U.S. dollars, the underlying equity","page_number":37,"box":{"x":69,"y":226,"width":836,"height":11}},{"id":"a9d013f4-59a4-45b3-b6a2-4a7dd701774f","block_type":"box","text":"securities may be quoted in the currency of the country where the issuer is domiciled. As a result, fluctuations in the","page_number":37,"box":{"x":69,"y":241,"width":832,"height":11}},{"id":"22af7355-5d72-40be-b4f8-fefb57ff58e7","block_type":"box","text":"exchange rate between the currency in which the debt security is denominated and the currency in which the share","page_number":37,"box":{"x":69,"y":257,"width":818,"height":11}},{"id":"7216bf57-cbb9-4161-851f-09540306a76e","block_type":"box","text":"price is quoted will affect the value of the convertible security. With respect to convertible securities denominated in","page_number":37,"box":{"x":70,"y":271,"width":828,"height":12}},{"id":"5d24d28b-33f6-47ad-b04b-d53fd0788e5a","block_type":"box","text":"a currency different from that of the underlying equity securities, the conversion price may be based on a fixed","page_number":37,"box":{"x":69,"y":286,"width":786,"height":12}},{"id":"ec7dec4a-76ac-48ac-9e5b-25e8bfeb102d","block_type":"box","text":"exchange rate established at the time the security is issued, which may increase the effects of currency risk. As","page_number":37,"box":{"x":69,"y":302,"width":800,"height":11}},{"id":"69c6111f-84ab-49f4-8a0a-fdd519d9ae7b","block_type":"box","text":"described below, a Fund is authorized to enter into foreign currency hedging transactions in which it may seek to","page_number":37,"box":{"x":69,"y":317,"width":800,"height":11}},{"id":"82f59dbd-8a7d-45cf-aa9d-83a7bb9760df","block_type":"box","text":"reduce the effect of exchange rate fluctuations.","page_number":37,"box":{"x":69,"y":332,"width":337,"height":11}},{"id":"fd356b01-1e41-41f6-b695-16e8e36b377b","block_type":"box","text":"Apart from currency considerations, the value of convertible securities is influenced by both the yield on","page_number":37,"box":{"x":101,"y":355,"width":741,"height":11}},{"id":"4be8a78d-ef77-44ed-8b06-d69b8ea6f4b7","block_type":"box","text":"nonconvertible securities of comparable issuers and by the value of the underlying common stock. The value of a","page_number":37,"box":{"x":69,"y":370,"width":806,"height":11}},{"id":"d939512e-15fb-40d1-ae36-0c8940b459f0","block_type":"box","text":"convertible security viewed without regard to its conversion feature (","page_number":37,"box":{"x":69,"y":385,"width":485,"height":11}},{"id":"3fe8031a-92fc-4141-99da-109203836d24","block_type":"box","text":"i.e.","page_number":37,"box":{"x":557,"y":385,"width":20,"height":9}},{"id":"c3040dab-418e-48a3-9bc0-bf70234ab8c9","block_type":"box","text":", strictly on the basis of its yield) is","page_number":37,"box":{"x":579,"y":385,"width":248,"height":11}},{"id":"122dd6fc-0f25-4c95-b0a2-6b92d1b88655","block_type":"box","text":"sometimes referred to as its “investment value.” To the extent interest rates change, the investment value of the","page_number":37,"box":{"x":69,"y":400,"width":808,"height":11}},{"id":"0a80549b-25a9-4f16-8013-f6aaf93c9b42","block_type":"box","text":"convertible security typically will fluctuate. At the same time, however, the value of the convertible security will be","page_number":37,"box":{"x":69,"y":415,"width":807,"height":11}},{"id":"2343d419-0c21-4623-9b46-02eef68f0f20","block_type":"box","text":"influenced by its “conversion value,” which is the market value of the underlying common stock that would be","page_number":37,"box":{"x":70,"y":430,"width":778,"height":11}},{"id":"238735a7-101e-412d-8cc1-17c6b4e91ec2","block_type":"box","text":"obtained if the convertible security were converted. Conversion value fluctuates directly with the price of the","page_number":37,"box":{"x":69,"y":445,"width":769,"height":11}},{"id":"9aae705a-9c21-4d35-afce-c9618381df41","block_type":"box","text":"underlying common stock. If the conversion value of a convertible security is substantially below its investment value,","page_number":37,"box":{"x":69,"y":460,"width":837,"height":12}},{"id":"f83a585b-26c1-479c-a4e6-4df1616c9198","block_type":"box","text":"the price of the convertible security is governed principally by its investment value. To the extent the conversion value","page_number":37,"box":{"x":68,"y":475,"width":837,"height":12}},{"id":"6cdc92e1-f749-42b3-95d0-d79c983f7b26","block_type":"box","text":"of a convertible security increases to a point that approximates or exceeds its investment value, the price of the","page_number":37,"box":{"x":69,"y":491,"width":800,"height":11}},{"id":"2c78f9be-dd78-4685-8fac-e1416444d1fe","block_type":"box","text":"convertible security will be influenced principally by its conversion value. A convertible security will sell at a premium","page_number":37,"box":{"x":69,"y":506,"width":828,"height":11}},{"id":"c34a4b0c-0da7-4044-a119-cdd6be387db1","block_type":"box","text":"over the conversion value to the extent investors place value on the right to acquire the underlying common stock","page_number":37,"box":{"x":69,"y":521,"width":808,"height":11}},{"id":"856774ee-ae5c-4827-b86a-8ef6f49424b4","block_type":"box","text":"while holding a fixed-income security. The yield and conversion premium of convertible securities issued in Japan and","page_number":37,"box":{"x":68,"y":536,"width":835,"height":11}},{"id":"93cf6dff-da4d-4c84-9703-52d793ccbbe5","block_type":"box","text":"the Euromarket are frequently determined at levels that cause the conversion value to affect their market value more","page_number":37,"box":{"x":68,"y":551,"width":836,"height":11}},{"id":"0187f694-a4b7-47e2-9c75-a1c025d9f1bc","block_type":"box","text":"than the securities’ investment value.","page_number":37,"box":{"x":68,"y":566,"width":268,"height":9}},{"id":"fc12ed35-8a92-4f7e-8e3a-3c7447c98341","block_type":"box","text":"Holders of convertible securities generally have a claim on the assets of the issuer prior to the common","page_number":37,"box":{"x":102,"y":589,"width":740,"height":11}},{"id":"540beb05-7a5d-4208-8ad5-fc13577f3b18","block_type":"box","text":"stockholders but may be subordinated to other debt securities of the same issuer. A convertible security may be","page_number":37,"box":{"x":69,"y":604,"width":801,"height":11}},{"id":"a14538ea-4e07-4106-82e3-fedd693f8ad2","block_type":"box","text":"subject to redemption at the option of the issuer at a price established in a charter provision, indenture or other","page_number":37,"box":{"x":69,"y":619,"width":800,"height":11}},{"id":"5c89d790-3c2d-4b1a-b091-a452a03cec0b","block_type":"box","text":"governing instrument pursuant to which the convertible security was issued. If a convertible security held by a Fund is","page_number":37,"box":{"x":68,"y":634,"width":840,"height":12}},{"id":"dc709f93-0aff-4f53-9079-38aace398d32","block_type":"box","text":"called for redemption, the Fund will be required to redeem the security, convert it into the underlying common stock","page_number":37,"box":{"x":69,"y":649,"width":823,"height":12}},{"id":"c6241541-b620-4b7b-ba8f-7c77bb3cda2c","block_type":"box","text":"or sell it to a third party. Certain convertible debt securities may provide a put option to the holder, which entitles the","page_number":37,"box":{"x":69,"y":665,"width":835,"height":11}},{"id":"c3a9ddeb-605e-4da1-80fb-d3d59d1a105f","block_type":"box","text":"holder to cause the security to be redeemed by the issuer at a premium over the stated principal amount of the debt","page_number":37,"box":{"x":69,"y":680,"width":832,"height":11}},{"id":"6acc26bb-0d22-4b3e-a8bb-6d67f5a59cf9","block_type":"box","text":"security under certain circumstances.","page_number":37,"box":{"x":69,"y":695,"width":267,"height":11}},{"id":"417aea56-5180-4b9c-8a48-45c20c4b0c59","block_type":"box","text":"A Fund may also invest in synthetic convertible securities. Synthetic convertible securities may include either","page_number":37,"box":{"x":101,"y":718,"width":777,"height":11}},{"id":"090fae44-1d33-4b98-bd25-d80a9541026c","block_type":"box","text":"Cash-Settled Convertibles or Manufactured Convertibles. “Cash-Settled Convertibles” are instruments that are","page_number":37,"box":{"x":69,"y":732,"width":789,"height":10}},{"id":"2c8f2c6f-a00e-4560-aca5-eb33a3ce7a0c","block_type":"box","text":"created by the issuer and have the economic characteristics of traditional convertible securities but may not actually","page_number":37,"box":{"x":69,"y":748,"width":831,"height":11}},{"id":"9395153d-3acf-4d7d-b0be-95f76d49c8f6","block_type":"box","text":"permit conversion into the underlying equity securities in all circumstances. As an example, a private company may","page_number":37,"box":{"x":70,"y":763,"width":819,"height":11}},{"id":"b644e469-6f65-442d-9dcc-18106150bb75","block_type":"box","text":"issue a Cash-Settled Convertible that is convertible into common stock only if the company successfully completes a","page_number":37,"box":{"x":70,"y":778,"width":833,"height":11}},{"id":"f0eed369-bc33-44ea-b9a5-5c1a670b354a","block_type":"box","text":"public offering of its common stock prior to maturity and otherwise pays a cash amount to reflect any equity","page_number":37,"box":{"x":70,"y":793,"width":769,"height":11}},{"id":"99eae0a1-82f9-4d8c-9d0f-eb5ed7d2a1b9","block_type":"box","text":"appreciation. “Manufactured Convertibles” are created by the Manager or another party by combining separate","page_number":37,"box":{"x":69,"y":808,"width":791,"height":11}},{"id":"0cbbd3db-da6d-40b4-afb0-e22b0ea38b6d","block_type":"box","text":"securities that possess one of the two principal characteristics of a convertible security,","page_number":37,"box":{"x":69,"y":823,"width":627,"height":11}},{"id":"12efa15f-220d-4db6-88d7-64e6e2340919","block_type":"box","text":"i.e.","page_number":37,"box":{"x":703,"y":823,"width":20,"height":9}},{"id":"613b70e0-8a3d-4a8c-aa1a-0a960aebcde3","block_type":"box","text":", fixed-income (“fixed","page_number":37,"box":{"x":726,"y":823,"width":151,"height":11}},{"id":"b12fa2cd-ec04-4f13-9145-a931a76b6205","block_type":"box","text":"income component”) or a right to acquire equity securities (“convertibility component”). The fixed-income component","page_number":37,"box":{"x":70,"y":838,"width":830,"height":12}},{"id":"e23002d0-d33d-48e1-a0ec-df5b72203f51","block_type":"box","text":"is achieved by investing in nonconvertible fixed-income securities, such as nonconvertible bonds, preferred stocks","page_number":37,"box":{"x":70,"y":853,"width":814,"height":12}},{"id":"4480416d-55e7-4690-8c8a-046bea346331","block_type":"box","text":"and money market instruments. The convertibility component is achieved by investing in call options, warrants, or","page_number":37,"box":{"x":69,"y":869,"width":811,"height":11}},{"id":"29859ae6-49fe-4916-9e7c-a40509204ede","block_type":"box","text":"other securities with equity conversion features (“equity features”) granting the holder the right to purchase a","page_number":37,"box":{"x":69,"y":884,"width":779,"height":11}},{"id":"56cb217e-de7b-4167-911d-6b0675cd0007","block_type":"box","text":"II-6","page_number":37,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"74f3522a-c11e-438a-a1ba-eea0dd9c2175","block_type":"box","text":"NM0926U-5977317-37/232","page_number":37,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"1889a46b-d1c3-4831-987d-dd721fcfd194","block_type":"box","text":"specified quantity of the underlying stocks within a specified period of time at a specified price or, in the case of a","page_number":38,"box":{"x":69,"y":45,"width":813,"height":11}},{"id":"3c50305c-1db7-4e12-a0ed-425b592ac03c","block_type":"box","text":"stock index option, the right to receive a cash payment based on the value of the underlying stock index.","page_number":38,"box":{"x":69,"y":60,"width":744,"height":11}},{"id":"21ef78fc-7365-4be9-af47-faa5db775381","block_type":"box","text":"A Manufactured Convertible differs from traditional convertible securities in several respects. Unlike a traditional","page_number":38,"box":{"x":101,"y":82,"width":804,"height":11}},{"id":"f1c777b1-6cb1-4c87-888f-8f86daf8eac5","block_type":"box","text":"convertible security, which is a single security that has a unitary market value, a Manufactured Convertible is","page_number":38,"box":{"x":69,"y":98,"width":777,"height":11}},{"id":"f9762ad7-62eb-4f84-95f2-cfe6fec5ef83","block_type":"box","text":"comprised of two or more separate securities, each with its own market value. Therefore, the total “market value” of","page_number":38,"box":{"x":69,"y":113,"width":832,"height":11}},{"id":"68ede842-a782-4fdd-9bae-fb5f854582ba","block_type":"box","text":"such a Manufactured Convertible is the sum of the values of its fixed-income component and its convertibility","page_number":38,"box":{"x":69,"y":128,"width":781,"height":11}},{"id":"0ee103fa-fc83-499b-9687-549482a2e7cb","block_type":"box","text":"component.","page_number":38,"box":{"x":69,"y":144,"width":82,"height":10}},{"id":"b568d3ff-1547-4eeb-b8a8-c6f2af907da1","block_type":"box","text":"More flexibility is possible in the creation of a Manufactured Convertible than in the purchase of a traditional","page_number":38,"box":{"x":102,"y":166,"width":773,"height":11}},{"id":"45df1201-19a4-4c8d-8ad2-950a7be0d7ca","block_type":"box","text":"convertible security. Because many corporations have not issued convertible securities, the Manager may combine a","page_number":38,"box":{"x":69,"y":181,"width":833,"height":11}},{"id":"bc40e639-be60-4d8f-9d7d-33155b1535e1","block_type":"box","text":"fixed-income instrument and an equity feature with respect to the stock of the issuer of the fixed-income instrument","page_number":38,"box":{"x":68,"y":196,"width":826,"height":11}},{"id":"894adcfd-c8ba-4060-af97-b1f818a405e5","block_type":"box","text":"to create a synthetic convertible security otherwise unavailable in the market. The Manager may also combine a","page_number":38,"box":{"x":68,"y":211,"width":800,"height":11}},{"id":"ac93aa16-efda-4d57-a516-ef7cf5dec063","block_type":"box","text":"fixed-income instrument of an issuer with an equity feature with respect to the stock of a different issuer when the","page_number":38,"box":{"x":68,"y":226,"width":817,"height":11}},{"id":"70bed741-269c-4868-9d46-4913aa816382","block_type":"box","text":"Manager believes such a Manufactured Convertible would better promote a Fund’s objective than alternative","page_number":38,"box":{"x":70,"y":241,"width":772,"height":11}},{"id":"37dc54b3-2d5d-4afa-9560-8c45680e9d5d","block_type":"box","text":"investments. For example, the Manager may combine an equity feature with respect to an issuer’s stock with a fixed","page_number":38,"box":{"x":70,"y":256,"width":833,"height":12}},{"id":"53292bf5-f4c9-4a5f-a43e-75be5333849f","block_type":"box","text":"income security of a different issuer in the same industry to diversify the Fund’s credit exposure, or with a U.S.","page_number":38,"box":{"x":70,"y":271,"width":790,"height":12}},{"id":"bd35aaee-0676-43db-bd4b-1056dac8df39","block_type":"box","text":"Treasury instrument to create a Manufactured Convertible with a higher credit profile than a traditional convertible","page_number":38,"box":{"x":68,"y":286,"width":815,"height":12}},{"id":"306efde9-6056-4d9a-a960-855d2dca8ea3","block_type":"box","text":"security issued by that issuer. A Manufactured Convertible also is a more flexible investment in that its two","page_number":38,"box":{"x":69,"y":302,"width":764,"height":11}},{"id":"78cf6a82-2774-4550-98eb-e67651d5ed53","block_type":"box","text":"components may be purchased separately and, upon purchasing the separate securities, “combined” to create a","page_number":38,"box":{"x":69,"y":317,"width":806,"height":11}},{"id":"00334dc6-7d0f-4e2b-96da-4e3bdff2c83f","block_type":"box","text":"Manufactured Convertible. For example, the Fund may purchase a warrant for eventual inclusion in a Manufactured","page_number":38,"box":{"x":70,"y":332,"width":818,"height":11}},{"id":"8cda3c9e-5b2e-4f69-b903-022b05ad523f","block_type":"box","text":"Convertible while postponing the purchase of a suitable bond to pair with the warrant pending development of more","page_number":38,"box":{"x":69,"y":347,"width":824,"height":11}},{"id":"2e5950c4-b466-4a17-8ea1-f01ba53ef26e","block_type":"box","text":"favorable market conditions.","page_number":38,"box":{"x":68,"y":362,"width":202,"height":9}},{"id":"efb7b298-5ad9-4e6f-8a50-0da0756b7315","block_type":"box","text":"The value of a Manufactured Convertible may respond to certain market fluctuations differently from a traditional","page_number":38,"box":{"x":101,"y":385,"width":805,"height":11}},{"id":"a7112b55-964a-449f-bac0-c5f9c9eaece6","block_type":"box","text":"convertible security with similar characteristics. For example, in the event a Fund created a Manufactured Convertible","page_number":38,"box":{"x":69,"y":400,"width":837,"height":11}},{"id":"51449ab3-941b-4b31-969b-6c70555b140e","block_type":"box","text":"by combining a short-term U.S. Treasury instrument and a call option on a stock, the Manufactured Convertible would","page_number":38,"box":{"x":69,"y":415,"width":839,"height":11}},{"id":"b064cfb0-07b6-4b23-b4a0-3b0ca5911099","block_type":"box","text":"be expected to outperform a traditional convertible of similar maturity that is convertible into that stock during","page_number":38,"box":{"x":69,"y":430,"width":787,"height":11}},{"id":"b6e12023-263b-46f0-82d5-8a7b7f63bb4a","block_type":"box","text":"periods when Treasury instruments outperform corporate fixed-income securities and underperform during periods","page_number":38,"box":{"x":70,"y":445,"width":815,"height":12}},{"id":"e97be252-a0fd-4020-8c1d-eb3fcdf58ad9","block_type":"box","text":"when corporate fixed-income securities outperform Treasury instruments.","page_number":38,"box":{"x":68,"y":460,"width":523,"height":12}},{"id":"6c1299f3-9157-4bc5-af56-1fd7763cbb4f","block_type":"box","text":"Corporate Loans.","page_number":38,"box":{"x":102,"y":483,"width":123,"height":11}},{"id":"1b88369f-e449-4422-b548-d78b6c57cbbf","block_type":"box","text":"Certain Funds may invest in corporate loans. Corporate loans are generally non-investment","page_number":38,"box":{"x":231,"y":483,"width":647,"height":11}},{"id":"82df9ba0-b619-4710-955a-3077b2987dcc","block_type":"box","text":"grade floating rate instruments. Usually, they are freely callable at the issuer’s option. Certain Funds may invest in","page_number":38,"box":{"x":68,"y":498,"width":817,"height":11}},{"id":"2ab66f9e-16da-4366-9688-8435638e3493","block_type":"box","text":"fixed and floating rate loans (“Loans”) arranged through private negotiations between a corporate borrower or a","page_number":38,"box":{"x":68,"y":513,"width":794,"height":12}},{"id":"924492f7-c6ac-4295-b16d-642a4c880765","block_type":"box","text":"foreign sovereign entity and one or more financial institutions or institutional investors (“Lenders”). A Fund may invest","page_number":38,"box":{"x":68,"y":528,"width":841,"height":12}},{"id":"4eae4106-edd9-4d42-a8d1-acd902d01e9d","block_type":"box","text":"in such Loans in the form of participations in Loans (“Participations”) and assignments of all or a portion of Loans","page_number":38,"box":{"x":70,"y":543,"width":818,"height":12}},{"id":"7519b443-78c0-4f66-9197-9133a4d1937c","block_type":"box","text":"from third parties (“Assignments”). A Fund considers these investments to be investments in debt securities for","page_number":38,"box":{"x":68,"y":559,"width":801,"height":11}},{"id":"39662b69-eeb5-4092-a7c1-f6def47a0c7a","block_type":"box","text":"purposes of its investment policies. Participations typically will result in the Fund having a contractual relationship","page_number":38,"box":{"x":70,"y":574,"width":811,"height":11}},{"id":"de07bac3-dadf-4352-9545-36184925a673","block_type":"box","text":"only with the Lender, not with the borrower. The Fund will have the right to receive payments of principal, interest and","page_number":38,"box":{"x":69,"y":589,"width":833,"height":11}},{"id":"311fc223-f12c-4897-b72b-7758941f1f40","block_type":"box","text":"any fees to which it is entitled only from the Lender selling the Participation and only upon receipt by the Lender of","page_number":38,"box":{"x":69,"y":604,"width":817,"height":11}},{"id":"3110b4ee-2750-4c57-bea4-8a88430fd953","block_type":"box","text":"the payments from the borrower. In connection with purchasing Participations, the Fund generally will have no right to","page_number":38,"box":{"x":68,"y":619,"width":836,"height":11}},{"id":"dcad61bb-6425-44b7-b032-234ef39e60a7","block_type":"box","text":"enforce compliance by the borrower with the terms of the loan agreement relating to the Loans, nor any rights of set","page_number":38,"box":{"x":69,"y":634,"width":833,"height":12}},{"id":"67f5354c-9611-4313-adb6-c25be139a6cc","block_type":"box","text":"off against the borrower, and the Fund may not benefit directly from any collateral supporting the Loan in which it has","page_number":38,"box":{"x":69,"y":649,"width":837,"height":12}},{"id":"135fad7e-d70e-4539-aa83-6f97f9c65523","block_type":"box","text":"purchased the Participation. As a result, the Fund will assume the credit risk of both the borrower and the Lender","page_number":38,"box":{"x":70,"y":664,"width":809,"height":11}},{"id":"f3603371-450b-4171-98b4-7f23a51df447","block_type":"box","text":"that is selling the Participation. In the event of the insolvency of the Lender selling the Participation, the Fund may be","page_number":38,"box":{"x":68,"y":680,"width":838,"height":11}},{"id":"2dfcfe73-fdef-44ab-94ff-8124dd6593fc","block_type":"box","text":"treated as a general creditor of the Lender and may not benefit from any set-off between the Lender and the","page_number":38,"box":{"x":68,"y":695,"width":772,"height":11}},{"id":"a5e924d4-e162-416c-b4e7-24f505e7461f","block_type":"box","text":"borrower. The Fund will acquire Participations only if the Lender interpositioned between the Fund and the borrower is","page_number":38,"box":{"x":69,"y":710,"width":837,"height":11}},{"id":"47a4344e-8910-45bb-b4a6-b8ea7d518df1","block_type":"box","text":"determined by the Fund’s manager to be creditworthy. When the Fund purchases Assignments from Lenders, the","page_number":38,"box":{"x":69,"y":725,"width":804,"height":11}},{"id":"eb18f80c-bf46-4b3d-9011-bc623a118681","block_type":"box","text":"Fund will acquire direct rights against the borrower on the Loan, and will not have exposure to a counterparty’s credit","page_number":38,"box":{"x":70,"y":740,"width":834,"height":11}},{"id":"6afb32f7-7993-4561-b834-724fdec4d455","block_type":"box","text":"risk. The Funds may enter into Participations and Assignments on a forward commitment or “when-issued” basis,","page_number":38,"box":{"x":69,"y":755,"width":809,"height":11}},{"id":"bc8a7290-585d-4590-9f7d-02a892b4a1fb","block_type":"box","text":"whereby a Fund would agree to purchase a Participation or Assignment at set terms in the future. For more","page_number":38,"box":{"x":68,"y":770,"width":764,"height":12}},{"id":"f182cbb2-7e16-478e-94ac-54c03b67e1d7","block_type":"box","text":"information on forward commitments and when-issued securities, see “When-Issued Securities, Delayed Delivery","page_number":38,"box":{"x":70,"y":785,"width":805,"height":12}},{"id":"991d55a6-ae3f-4777-94d1-31a50c9ce1a0","block_type":"box","text":"Securities and Forward Commitments” below.","page_number":38,"box":{"x":69,"y":801,"width":324,"height":9}},{"id":"81290aa7-2ea1-423d-b09c-e7897bc213ee","block_type":"box","text":"A Fund may have difficulty disposing of Assignments and Participations. In certain cases, the market for such","page_number":38,"box":{"x":101,"y":823,"width":782,"height":12}},{"id":"a66b3009-29cd-4a13-9f42-e569828e9c03","block_type":"box","text":"instruments may lack sufficient liquidity, and therefore the Fund anticipates that in such cases such instruments","page_number":38,"box":{"x":70,"y":838,"width":803,"height":11}},{"id":"056d0075-4a73-428c-9e4f-d3f960a0c97e","block_type":"box","text":"could be sold only to a limited number of institutional investors. The lack of a sufficiently liquid secondary market","page_number":38,"box":{"x":69,"y":853,"width":809,"height":12}},{"id":"26fde9c8-9493-4567-9dcd-1ddaa8fcd8ac","block_type":"box","text":"may have an adverse impact on the value of such instruments and on the Fund’s ability to dispose of particular","page_number":38,"box":{"x":69,"y":869,"width":795,"height":11}},{"id":"afffacfa-c371-4b3f-8537-8a0aa5855e8c","block_type":"box","text":"Assignments or Participations in response to a specific economic event, such as deterioration in the creditworthiness","page_number":38,"box":{"x":68,"y":884,"width":841,"height":11}},{"id":"1f55fe9a-6342-4bc8-92cb-75cbee281751","block_type":"box","text":"of the borrower.","page_number":38,"box":{"x":69,"y":899,"width":111,"height":9}},{"id":"1f553664-87d9-4c3d-a058-36244036c1f2","block_type":"box","text":"II-7","page_number":38,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"f802181d-9378-4094-91ce-4ca1acda7026","block_type":"box","text":"NM0926U-5977317-38/232","page_number":38,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"59343cad-ca35-41b4-88fb-4cbd681dd0e6","block_type":"box","text":"Leading financial institutions often act as agent for a broader group of Lenders, generally referred to as a","page_number":39,"box":{"x":102,"y":45,"width":750,"height":11}},{"id":"d2f544bd-3171-4c60-8ce6-df841d9b2f94","block_type":"box","text":"syndicate. The syndicate’s agent arranges the loans, holds collateral and accepts payments of principal and interest.","page_number":39,"box":{"x":69,"y":60,"width":834,"height":11}},{"id":"749ab602-bd54-494f-8b66-20cb7bb17dfe","block_type":"box","text":"Failure by the syndicate agent to fulfill its obligations may delay or adversely affect receipt of payment by the Fund.","page_number":39,"box":{"x":70,"y":75,"width":816,"height":11}},{"id":"65ae87f3-2546-42e1-a52b-09319bbf1c6d","block_type":"box","text":"The Loans in which the Fund may invest are subject to the risk of loss of principal and income. Although","page_number":39,"box":{"x":101,"y":98,"width":740,"height":11}},{"id":"28fdce1e-de8c-4f39-97db-73ae00b147a7","block_type":"box","text":"borrowers frequently provide collateral to secure repayment of these obligations they do not always do so. If they do","page_number":39,"box":{"x":69,"y":113,"width":827,"height":11}},{"id":"db7e640b-be9e-4271-8302-51e48dc7ce45","block_type":"box","text":"provide collateral, the value of the collateral may not completely cover the borrower’s obligations at the time of a","page_number":39,"box":{"x":70,"y":128,"width":802,"height":11}},{"id":"555d9c73-e499-4194-8942-6bab2d5d44ae","block_type":"box","text":"default. If a borrower files for protection from its creditors under the U.S. bankruptcy laws, these laws may limit a","page_number":39,"box":{"x":69,"y":143,"width":808,"height":11}},{"id":"752e80f3-baff-4d5a-917c-76841d944d19","block_type":"box","text":"Fund’s rights to its collateral. In addition, the value of collateral may erode during a bankruptcy case. In the event of","page_number":39,"box":{"x":70,"y":158,"width":827,"height":11}},{"id":"55141ced-9097-4413-bb90-7a5ec1ae144d","block_type":"box","text":"a bankruptcy, the holder of a Loan may not recover its principal, may experience a long delay in recovering its","page_number":39,"box":{"x":69,"y":173,"width":777,"height":11}},{"id":"849939e6-44b0-4805-9582-ac9effd5a879","block_type":"box","text":"investment and may not receive interest during the delay.","page_number":39,"box":{"x":70,"y":188,"width":406,"height":12}},{"id":"656d08c6-7590-45d4-bf61-e0d37b1d5669","block_type":"box","text":"Transactions in corporate loans may settle on a delayed basis. As a result, the proceeds from the sale of","page_number":39,"box":{"x":101,"y":211,"width":752,"height":11}},{"id":"0bc659e4-164e-48f0-8bc0-8c51f22f5ecf","block_type":"box","text":"corporate loans may not be readily available to make additional investments or to meet a Fund’s redemption","page_number":39,"box":{"x":69,"y":226,"width":773,"height":11}},{"id":"86514b96-8a4e-495a-bcfc-a5a963848b60","block_type":"box","text":"obligations. To the extent the extended settlement process gives rise to short-term liquidity needs, a Fund may hold","page_number":39,"box":{"x":69,"y":241,"width":824,"height":11}},{"id":"f4899285-df2a-4ff6-a56f-6e1a7183e1a8","block_type":"box","text":"additional cash, sell investments or temporarily borrow from banks and other lenders.","page_number":39,"box":{"x":69,"y":256,"width":610,"height":11}},{"id":"75af8989-bc5f-4429-b854-4a670279e390","block_type":"box","text":"In certain circumstances, Loans may not be deemed to be securities under certain federal securities laws.","page_number":39,"box":{"x":102,"y":279,"width":759,"height":11}},{"id":"453dfc06-0543-4fad-9d07-bea9c5766568","block_type":"box","text":"Therefore, in the event of fraud or misrepresentation by a borrower or an arranger, Lenders and purchasers of","page_number":39,"box":{"x":68,"y":294,"width":784,"height":11}},{"id":"84760a7b-ad5f-4545-9a0a-9d78e6eea603","block_type":"box","text":"interests in Loans, such as the Funds, may not have the protection of the anti-fraud provisions of the federal","page_number":39,"box":{"x":70,"y":309,"width":772,"height":11}},{"id":"81d1279e-65fc-4f52-a613-caf303daf61a","block_type":"box","text":"securities laws as would otherwise be available for bonds or stocks. Instead, in such cases, parties generally would","page_number":39,"box":{"x":69,"y":324,"width":827,"height":12}},{"id":"5a1dcc3d-e30f-4542-ab8d-4c1b2078fd83","block_type":"box","text":"rely on the contractual provisions in the Loan agreement itself and common-law fraud protections under applicable","page_number":39,"box":{"x":69,"y":339,"width":815,"height":12}},{"id":"e6af3190-b9ce-413b-89ab-092df89cc44d","block_type":"box","text":"state law.","page_number":39,"box":{"x":69,"y":355,"width":67,"height":9}},{"id":"65f2b81f-7d47-4ede-9c90-e60015b6698c","block_type":"box","text":"Direct Lending.","page_number":39,"box":{"x":102,"y":377,"width":105,"height":12}},{"id":"e64677db-ac35-4d69-8cdb-10f175505c6f","block_type":"box","text":"The Fund may act as the originator for direct loans and engage in direct lending. Direct loans","page_number":39,"box":{"x":213,"y":377,"width":660,"height":12}},{"id":"42cdc831-a7df-4835-94a8-ca5efbc72693","block_type":"box","text":"between the Fund and a borrower may not be administered by an underwriter or agent bank. The Fund may provide","page_number":39,"box":{"x":69,"y":393,"width":817,"height":11}},{"id":"8b377712-0a4c-4805-9bd1-0bef05b5dfcf","block_type":"box","text":"financing to commercial borrowers directly or through companies acquired (or created) and owned by or otherwise","page_number":39,"box":{"x":68,"y":407,"width":811,"height":12}},{"id":"3a9ae8e5-aa30-4b8f-b5ef-470e15b1c397","block_type":"box","text":"affiliated with the Fund. The terms of the direct loans are negotiated with borrowers in private transactions.","page_number":39,"box":{"x":69,"y":423,"width":764,"height":11}},{"id":"9681ec9a-552b-4489-9368-99b0ce0924ed","block_type":"box","text":"Furthermore, a direct loan may be secured or unsecured.","page_number":39,"box":{"x":70,"y":438,"width":405,"height":11}},{"id":"a8abb6c4-9b0d-4901-a854-c2a94d60e183","block_type":"box","text":"In determining whether to make a direct loan, the Fund will rely primarily upon the creditworthiness of the","page_number":39,"box":{"x":102,"y":460,"width":750,"height":12}},{"id":"e1430e93-5772-4da6-9f2f-ff1c9b366737","block_type":"box","text":"borrower and/or any collateral for payment of interest and repayment of principal. The risks associated with direct","page_number":39,"box":{"x":69,"y":475,"width":813,"height":12}},{"id":"15db1f84-9920-4cb5-9a39-471b1d6b67cf","block_type":"box","text":"loans are substantially similar to those associated with investing in corporate loans. In making a direct loan, the Fund","page_number":39,"box":{"x":70,"y":491,"width":838,"height":11}},{"id":"1dc84bfa-a29a-4a4a-9cc4-a96d5e7eb141","block_type":"box","text":"is exposed to the risk that the borrower may default or become insolvent and, consequently, that the Fund will lose","page_number":39,"box":{"x":70,"y":506,"width":818,"height":11}},{"id":"905946a2-ec39-4923-91f6-874ae77328c6","block_type":"box","text":"money on the loan. Furthermore, direct loans may subject the Fund to liquidity and interest rate risk and certain","page_number":39,"box":{"x":69,"y":521,"width":798,"height":11}},{"id":"8358afca-957e-4aac-a209-405355080c8b","block_type":"box","text":"direct loans may be deemed illiquid. Direct loans are not publicly traded and may not have a secondary market. The","page_number":39,"box":{"x":69,"y":536,"width":825,"height":11}},{"id":"727255be-3683-4af7-89d9-a0417754b718","block_type":"box","text":"lack of a secondary market for direct loans may have an adverse impact on the ability of the Fund to dispose of a","page_number":39,"box":{"x":70,"y":551,"width":807,"height":11}},{"id":"9e39ad0f-5c0d-4275-a1cb-b5dbb5c36126","block_type":"box","text":"direct loan and/or to value the direct loan.","page_number":39,"box":{"x":69,"y":566,"width":301,"height":11}},{"id":"57231a0f-5381-4a54-a567-bbf7284ac151","block_type":"box","text":"When engaging in direct lending, the Fund’s performance may depend, in part, on the ability of the Fund to","page_number":39,"box":{"x":101,"y":589,"width":762,"height":11}},{"id":"7b76ba3b-4a84-4259-b7c3-ea7e1e881fac","block_type":"box","text":"originate loans on advantageous terms. In originating loans, the Fund will compete with a broad spectrum of lenders.","page_number":39,"box":{"x":69,"y":604,"width":833,"height":11}},{"id":"f59a4389-d3e2-451a-9c66-3f133b4cac17","block_type":"box","text":"Increased competition for, or a diminishment in the available supply of, qualifying loans could result in lower yields on","page_number":39,"box":{"x":70,"y":619,"width":836,"height":11}},{"id":"0efcb749-b6dc-4e08-b8cb-e5d7401fc720","block_type":"box","text":"such loans, which could reduce Fund performance.","page_number":39,"box":{"x":69,"y":634,"width":362,"height":11}},{"id":"f647053d-4421-40d4-93e5-73edc1272ddc","block_type":"box","text":"As part of its lending activities, the Fund may originate loans to companies that are experiencing significant","page_number":39,"box":{"x":101,"y":657,"width":767,"height":11}},{"id":"48c45261-bd76-4dd3-ae65-c5e0779bb0ff","block_type":"box","text":"financial or business difficulties, including companies involved in bankruptcy or other reorganization and liquidation","page_number":39,"box":{"x":68,"y":672,"width":821,"height":11}},{"id":"440fb3bb-66d5-4faf-b9f9-0e50944799e8","block_type":"box","text":"proceedings. Although the terms of such financing may result in significant financial returns to the Fund, they involve","page_number":39,"box":{"x":70,"y":687,"width":830,"height":11}},{"id":"a6af3a93-ebfa-4584-8aac-78adf7dff833","block_type":"box","text":"a substantial degree of risk. The level of analytical sophistication, both financial and legal, necessary for successful","page_number":39,"box":{"x":69,"y":702,"width":826,"height":12}},{"id":"c833dd8d-6764-4141-89c1-0490ecb31800","block_type":"box","text":"financing to companies experiencing significant business and financial difficulties is unusually high.","page_number":39,"box":{"x":68,"y":717,"width":709,"height":12}},{"id":"3f81034b-c551-4d40-a957-87cb9239e7cf","block_type":"box","text":"Credit Linked Securities.","page_number":39,"box":{"x":102,"y":740,"width":179,"height":9}},{"id":"23318581-b643-4202-9dbf-74fb34eb1252","block_type":"box","text":"Among the income producing securities in which a Fund may invest are credit linked","page_number":39,"box":{"x":287,"y":740,"width":596,"height":11}},{"id":"7486e06a-0525-44a8-ae56-abb3158093e6","block_type":"box","text":"securities, which are issued by a limited purpose trust or other vehicle that, in turn, invests in a derivative instrument","page_number":39,"box":{"x":69,"y":755,"width":837,"height":11}},{"id":"18c7ecc1-714e-439e-a306-430397f1f8b8","block_type":"box","text":"or basket of derivative instruments, such as credit default swaps, interest rate swaps and other securities, in order","page_number":39,"box":{"x":69,"y":770,"width":823,"height":11}},{"id":"14f8d9ee-f62b-4c13-9198-193eafe07e5a","block_type":"box","text":"to provide exposure to certain fixed-income markets. For instance, a Fund may invest in credit linked securities as a","page_number":39,"box":{"x":68,"y":785,"width":827,"height":12}},{"id":"f4ee84fd-c8bc-4319-8c15-7aa429e9be2d","block_type":"box","text":"cash management tool in order to gain exposure to a certain market and/or to remain fully invested when more","page_number":39,"box":{"x":69,"y":801,"width":795,"height":11}},{"id":"6b2bb081-1155-4281-ae0c-a1e525835595","block_type":"box","text":"traditional income producing securities are not available.","page_number":39,"box":{"x":68,"y":816,"width":404,"height":11}},{"id":"1eddeced-4884-44b1-8da0-bf17171f11ab","block_type":"box","text":"Like an investment in a bond, investments in these credit linked securities represent the right to receive periodic","page_number":39,"box":{"x":102,"y":839,"width":804,"height":11}},{"id":"653b5a40-ebe5-40e2-8e3b-b0d920406752","block_type":"box","text":"income payments (in the form of distributions) and payment of principal at the end of the term of the security.","page_number":39,"box":{"x":70,"y":853,"width":780,"height":12}},{"id":"8d75730e-3ce3-4487-af94-432b05ab5747","block_type":"box","text":"However, these payments are conditioned on the issuer’s receipt of payments from, and the issuer’s potential","page_number":39,"box":{"x":102,"y":876,"width":785,"height":11}},{"id":"65e72310-10c0-4cdf-adf4-25b43bbaa2ea","block_type":"box","text":"obligations to, the counterparties to the derivative instruments and other securities in which the issuer invests. For","page_number":39,"box":{"x":69,"y":891,"width":821,"height":12}},{"id":"ea5d2bc8-9ce7-4e67-b17d-faedeb117977","block_type":"box","text":"instance, the issuer may sell one or more credit default swaps, under which the issuer would receive a stream of","page_number":39,"box":{"x":70,"y":906,"width":806,"height":12}},{"id":"fdce31c7-cf3f-4aa7-82b7-ecff2d7a7a52","block_type":"box","text":"II-8","page_number":39,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"3044137c-be75-4bdd-a654-9c8e80b118f7","block_type":"box","text":"NM0926U-5977317-39/232","page_number":39,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"1700daf0-fa8e-4cd4-ae3a-c80fde7ea311","block_type":"box","text":"payments over the term of the swap agreements provided that no event of default has occurred with respect to the","page_number":40,"box":{"x":70,"y":45,"width":819,"height":11}},{"id":"aefd4a34-fb0c-4b3f-825e-d2955f7ace97","block_type":"box","text":"referenced debt obligation upon which the swap is based. If a default occurs, the stream of payments may stop and","page_number":40,"box":{"x":69,"y":60,"width":826,"height":11}},{"id":"296d8191-8a93-44b3-8775-658c03ca061b","block_type":"box","text":"the issuer would be obligated to pay the counterparty the par (or other agreed upon value) of the referenced debt","page_number":40,"box":{"x":68,"y":75,"width":807,"height":11}},{"id":"0b374a23-b44c-41ea-b8c2-97a87f9c8653","block_type":"box","text":"obligation. This, in turn, would reduce the amount of income and principal that a Fund would receive. A Fund’s","page_number":40,"box":{"x":69,"y":90,"width":783,"height":11}},{"id":"a8adec2f-81a5-4fc7-a24d-f548721c6569","block_type":"box","text":"investments in these instruments are indirectly subject to the risks associated with derivative instruments, including,","page_number":40,"box":{"x":70,"y":105,"width":833,"height":11}},{"id":"089fdd46-38ee-460f-b39b-9d5b7c438208","block_type":"box","text":"among others, credit risk, default or similar event risk, counterparty risk, interest rate risk, leverage risk and","page_number":40,"box":{"x":69,"y":120,"width":771,"height":12}},{"id":"3e874bcf-661b-4c80-862e-29ef7a697e4c","block_type":"box","text":"management risk. It is also expected that the securities will be exempt from registration under the Securities Act.","page_number":40,"box":{"x":69,"y":135,"width":808,"height":12}},{"id":"4fa88386-5fa6-45c3-a14a-42a1e850e47f","block_type":"box","text":"Accordingly, there may be no established trading market for the securities and they may constitute illiquid","page_number":40,"box":{"x":68,"y":150,"width":752,"height":12}},{"id":"21277f91-9b6b-4cde-b1b4-9c83f147ce4d","block_type":"box","text":"investments.","page_number":40,"box":{"x":70,"y":166,"width":89,"height":9}},{"id":"2b3f6135-2758-4f82-bff7-afa43132751a","block_type":"box","text":"Debt Securities.","page_number":40,"box":{"x":102,"y":188,"width":116,"height":9}},{"id":"4bec1ec0-e000-401d-a1bf-718f207969ae","block_type":"box","text":"Debt securities, such as bonds, involve credit risk. This is the risk that the issuer will not make","page_number":40,"box":{"x":225,"y":188,"width":677,"height":11}},{"id":"577a6706-6095-448b-b54f-bd6e20a4fbf0","block_type":"box","text":"timely payments of principal and interest. The degree of credit risk depends on the issuer’s financial condition and on","page_number":40,"box":{"x":68,"y":203,"width":839,"height":12}},{"id":"334ebd37-5019-4b20-9512-0ed585ab0770","block_type":"box","text":"the terms of the debt securities. Changes in an issuer’s credit rating or the market’s perception of an issuer’s","page_number":40,"box":{"x":68,"y":218,"width":787,"height":12}},{"id":"90fde713-34e2-4384-8cd6-7670080e6b37","block_type":"box","text":"creditworthiness may also affect the value of a Fund’s investment in that issuer. Credit risk is reduced to the extent","page_number":40,"box":{"x":69,"y":234,"width":828,"height":11}},{"id":"24778014-46a3-491f-a367-3b67d5215416","block_type":"box","text":"a Fund limits its debt investments to U.S. Government Securities.","page_number":40,"box":{"x":69,"y":249,"width":466,"height":9}},{"id":"bb000595-f760-4d87-9ff5-5eceabc72fbf","block_type":"box","text":"All debt securities, however, are subject to interest rate risk. This is the risk that the value of the security may","page_number":40,"box":{"x":101,"y":271,"width":784,"height":12}},{"id":"c966978e-5a34-4131-9506-639a13862df6","block_type":"box","text":"fall when interest rates rise. If interest rates move sharply in a manner not anticipated by Fund management, a","page_number":40,"box":{"x":68,"y":286,"width":792,"height":12}},{"id":"e87b8d42-8240-4861-98ad-e9ca5abffe2d","block_type":"box","text":"Fund’s investments in debt securities could be adversely affected and the Fund could lose money. In general, the","page_number":40,"box":{"x":70,"y":302,"width":806,"height":11}},{"id":"d145e1ae-4010-4a7f-a9eb-452e6866fcfa","block_type":"box","text":"market price of debt securities with longer maturities will go up or down more in response to changes in interest","page_number":40,"box":{"x":69,"y":317,"width":800,"height":11}},{"id":"6736648a-4cd3-4683-9e5b-5c8bd7d1bd84","block_type":"box","text":"rates than will the market price of shorter-term debt securities.","page_number":40,"box":{"x":69,"y":332,"width":448,"height":11}},{"id":"c1899b44-3820-4ee7-9e3a-795b5733943a","block_type":"box","text":"During periods of rising interest rates, the average life of certain fixed-income securities is extended because of","page_number":40,"box":{"x":102,"y":355,"width":798,"height":11}},{"id":"8fe97990-fce9-4414-bae3-86ebc9963c41","block_type":"box","text":"slower than expected principal payments. This may lock in a below-market interest rate and extend the duration of","page_number":40,"box":{"x":69,"y":370,"width":813,"height":11}},{"id":"af2ccefc-c1fe-46e8-b2a3-fa1c6e526c73","block_type":"box","text":"these fixed-income securities, especially mortgage-related securities, making them more sensitive to changes in","page_number":40,"box":{"x":68,"y":385,"width":801,"height":11}},{"id":"9f80af80-d0bf-41b1-8d65-83e5c49ad75d","block_type":"box","text":"interest rates. As a result, in a period of rising interest rates, these securities may exhibit additional volatility and","page_number":40,"box":{"x":70,"y":400,"width":806,"height":11}},{"id":"5aba4825-5b8b-4db5-be94-984c01e10a50","block_type":"box","text":"lose value. This is known as extension risk.","page_number":40,"box":{"x":70,"y":415,"width":307,"height":9}},{"id":"20291764-3cb2-4194-83cb-afa7bdb189c0","block_type":"box","text":"The value of fixed-income securities in the Funds can be expected to vary inversely with changes in prevailing","page_number":40,"box":{"x":101,"y":438,"width":778,"height":11}},{"id":"0df05448-74f5-4d56-a3ee-5c2b70a4d10a","block_type":"box","text":"interest rates. Fixed-income securities with longer maturities, which tend to produce higher yields, are subject to","page_number":40,"box":{"x":70,"y":453,"width":798,"height":11}},{"id":"22916c93-4f56-467b-b851-1766affed878","block_type":"box","text":"potentially greater capital appreciation and depreciation than securities with shorter maturities. The Funds are not","page_number":40,"box":{"x":70,"y":468,"width":812,"height":11}},{"id":"a1c76995-8f9e-49c5-aa71-80ad3a4d7c8b","block_type":"box","text":"restricted to any maximum or minimum time to maturity in purchasing individual portfolio securities, and the average","page_number":40,"box":{"x":69,"y":483,"width":831,"height":11}},{"id":"f0020594-ed6f-426d-a01c-2a2e34655fa6","block_type":"box","text":"maturity of a Fund’s assets will vary.","page_number":40,"box":{"x":69,"y":498,"width":259,"height":11}},{"id":"91ea9a02-e1a2-4367-a126-8fd90ca70d3e","block_type":"box","text":"Floating and Variable Rate Securities","page_number":40,"box":{"x":102,"y":521,"width":260,"height":11}},{"id":"b0d01cc2-ec7e-428b-b03e-f1c4e30c2548","block_type":"box","text":". Certain Funds may invest in debt instruments that pay a variable coupon","page_number":40,"box":{"x":364,"y":521,"width":526,"height":11}},{"id":"51f24980-62f0-422e-968f-06c9b22acc15","block_type":"box","text":"rate. Securities with floating or variable interest rates can be less sensitive to interest rate changes than securities","page_number":40,"box":{"x":69,"y":536,"width":821,"height":11}},{"id":"c6d573e2-e8a9-4d2c-90a3-08006bdbb8df","block_type":"box","text":"with fixed interest rates, but may decline in value if their interest rates do not rise as much, or as quickly, as interest","page_number":40,"box":{"x":68,"y":551,"width":834,"height":11}},{"id":"2b71e38d-584d-4268-bf14-ea035e742535","block_type":"box","text":"rates in general. Conversely, floating rate securities will not generally increase in value if interest rates decline. The","page_number":40,"box":{"x":69,"y":566,"width":820,"height":11}},{"id":"b3c8a825-df76-4303-bea1-3b5620d95199","block_type":"box","text":"impact of interest rate changes on floating rate investments is typically mitigated by the periodic interest rate reset of","page_number":40,"box":{"x":70,"y":581,"width":838,"height":12}},{"id":"118decc6-c515-426e-a7c7-dd8967475159","block_type":"box","text":"the investments. Benchmark interest rates used for floating and variable rate securities may not accurately track","page_number":40,"box":{"x":68,"y":596,"width":804,"height":12}},{"id":"aa7cf908-6d67-41a4-bfa1-3a4988c4bf50","block_type":"box","text":"market interest rates.","page_number":40,"box":{"x":69,"y":612,"width":153,"height":9}},{"id":"25c08234-c1dc-47bc-9a67-66a11d384bf7","block_type":"box","text":"Inflation-Indexed Bonds.","page_number":40,"box":{"x":102,"y":634,"width":169,"height":9}},{"id":"4a15bbd6-a690-4d04-8405-fa2225cb9627","block_type":"box","text":"Certain Funds may invest in inflation-indexed bonds, which are fixed-income securities or","page_number":40,"box":{"x":278,"y":634,"width":632,"height":11}},{"id":"415d1cfa-07f1-4754-a352-d5dcb931e86d","block_type":"box","text":"other instruments whose principal value is periodically adjusted according to the rate of inflation. Two structures are","page_number":40,"box":{"x":69,"y":649,"width":828,"height":12}},{"id":"8113e421-01a7-4c2c-8845-99610e65b98c","block_type":"box","text":"common. The U.S. Treasury and some other issuers use a structure that accrues inflation into the principal value of","page_number":40,"box":{"x":69,"y":664,"width":827,"height":12}},{"id":"103519f7-5035-4f9b-a352-9160c956db4a","block_type":"box","text":"the bond. Most other issuers pay out the Consumer Price Index (“CPI”) accruals as part of a semi-annual coupon.","page_number":40,"box":{"x":68,"y":680,"width":810,"height":11}},{"id":"7e5df929-e532-4d0f-acc8-febb6d071025","block_type":"box","text":"Inflation-indexed securities issued by the U.S. Treasury have maturities of five, ten or thirty years, although it is","page_number":40,"box":{"x":102,"y":702,"width":792,"height":12}},{"id":"ac3573a9-41a3-4bb2-bfa3-ad2c33ecc849","block_type":"box","text":"possible that securities with other maturities will be issued in the future. The U.S. Treasury securities pay interest on","page_number":40,"box":{"x":70,"y":717,"width":833,"height":12}},{"id":"c1ed7806-6f94-4706-95c9-f9ff8e782098","block_type":"box","text":"a semi-annual basis, equal to a fixed percentage of the inflation-adjusted principal amount. For example, if a Fund","page_number":40,"box":{"x":69,"y":732,"width":810,"height":12}},{"id":"81784ed1-61c0-430a-8cd0-877ba0a35748","block_type":"box","text":"purchased an inflation-indexed bond with a par value of $1,000 and a 3% real rate of return coupon (payable 1.5%","page_number":40,"box":{"x":70,"y":747,"width":814,"height":12}},{"id":"cf3136c0-a75d-4aca-97a5-de061e5ab9a0","block_type":"box","text":"semi-annually), and inflation over the first six months was 1%, the mid-year par value of the bond would be $1,010","page_number":40,"box":{"x":69,"y":762,"width":816,"height":12}},{"id":"2d193aff-3bcb-4c33-8b7c-3e433d45358b","block_type":"box","text":"and the first semi-annual interest payment would be $15.15 ($1,010 times 1.5%). If inflation during the second half","page_number":40,"box":{"x":69,"y":777,"width":828,"height":12}},{"id":"1ae09ec1-1b55-4470-89e9-1debf1ee9211","block_type":"box","text":"of the year resulted in the whole year’s inflation equaling 3%, the end-of-year par value of the bond would be $1,030","page_number":40,"box":{"x":69,"y":792,"width":828,"height":12}},{"id":"58ca04b2-83ae-4350-9534-83cebb629f05","block_type":"box","text":"and the second semi-annual interest payment would be $15.45 ($1,030 times 1.5%).","page_number":40,"box":{"x":69,"y":807,"width":610,"height":12}},{"id":"589dcb37-750a-428d-8dd1-bd28a63da400","block_type":"box","text":"If the periodic adjustment rate measuring inflation falls, the principal value of inflation-indexed bonds will be","page_number":40,"box":{"x":102,"y":831,"width":767,"height":11}},{"id":"3d1fc66b-ecaa-4caf-a689-517ea64754d4","block_type":"box","text":"adjusted downward, and, consequently, the interest payable on these securities (calculated with respect to a smaller","page_number":40,"box":{"x":69,"y":846,"width":833,"height":11}},{"id":"eda949a5-2abc-4484-877d-0b58d36ac242","block_type":"box","text":"principal amount) will be reduced. Repayment of the original bond principal upon maturity (as adjusted for inflation) is","page_number":40,"box":{"x":70,"y":861,"width":834,"height":11}},{"id":"9c50251f-c9f8-4aca-8cad-4ffd3084854d","block_type":"box","text":"guaranteed in the case of U.S. Treasury inflation-indexed bonds, even during a period of deflation. However, the","page_number":40,"box":{"x":68,"y":876,"width":795,"height":11}},{"id":"2d439868-3299-4555-89fa-0516b2dcba52","block_type":"box","text":"current market value of the bonds is not guaranteed, and will fluctuate. Certain Funds may also invest in other","page_number":40,"box":{"x":69,"y":891,"width":788,"height":12}},{"id":"06606f97-7f47-4d95-8919-0b144a457ea6","block_type":"box","text":"inflation related bonds which may or may not provide a similar guarantee. If a guarantee of principal is not provided,","page_number":40,"box":{"x":70,"y":906,"width":823,"height":12}},{"id":"b22356b4-dc89-4c9d-a484-bd2ea5fe8617","block_type":"box","text":"II-9","page_number":40,"box":{"x":478,"y":943,"width":22,"height":9}},{"id":"033117b7-8862-4882-86c4-0faad7b3fcb1","block_type":"box","text":"NM0926U-5977317-40/232","page_number":40,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"423b3b97-946a-4fab-8b15-05645eede17a","block_type":"box","text":"the adjusted principal value of the bond repaid at maturity may be less than the original principal. In addition, if the","page_number":41,"box":{"x":68,"y":45,"width":821,"height":11}},{"id":"5dc782ce-0a49-4fc3-8e64-afd8cb416d16","block_type":"box","text":"Fund purchases inflation-indexed bonds offered by foreign issuers, the rate of inflation measured by the foreign","page_number":41,"box":{"x":70,"y":60,"width":792,"height":11}},{"id":"8ce220e9-bd6d-48d8-bb8f-50d0cdcabf8d","block_type":"box","text":"inflation index may not be correlated to the rate of inflation in the United States.","page_number":41,"box":{"x":70,"y":75,"width":570,"height":11}},{"id":"8948845c-3020-4070-8e76-5fe442f040b6","block_type":"box","text":"The value of inflation-indexed bonds is expected to change in response to changes in real interest rates. Real","page_number":41,"box":{"x":101,"y":98,"width":780,"height":11}},{"id":"22a608a4-326a-4111-ba5b-b6f61e431bd8","block_type":"box","text":"interest rates, in turn, are tied to the relationship between nominal interest rates and the rate of inflation. Therefore,","page_number":41,"box":{"x":70,"y":113,"width":831,"height":11}},{"id":"0ec8ca60-ec89-4f63-8781-925ac686b91a","block_type":"box","text":"if inflation were to rise at a faster rate than nominal interest rates, real interest rates might decline, leading to an","page_number":41,"box":{"x":70,"y":128,"width":808,"height":11}},{"id":"bf05c72e-0811-46af-9ec4-e9803929d360","block_type":"box","text":"increase in value of inflation-indexed bonds. In contrast, if nominal interest rates increased at a faster rate than","page_number":41,"box":{"x":70,"y":143,"width":796,"height":10}},{"id":"9d61a56d-e040-4f48-9cee-cd0677aa71be","block_type":"box","text":"inflation, real interest rates might rise, leading to a decrease in value of inflation-indexed bonds. There can be no","page_number":41,"box":{"x":70,"y":158,"width":805,"height":11}},{"id":"dad8274b-1519-4778-8dc3-66d73c608d64","block_type":"box","text":"assurance, however, that the value of inflation-indexed bonds will be directly correlated to changes in interest rates.","page_number":41,"box":{"x":69,"y":173,"width":824,"height":11}},{"id":"0683430a-1c6d-4f0c-a07b-4d3ec09b6ec1","block_type":"box","text":"While these securities are expected to be protected from long-term inflationary trends, short-term increases in","page_number":41,"box":{"x":101,"y":196,"width":788,"height":11}},{"id":"b401d490-db55-4437-9304-48be18d274e9","block_type":"box","text":"inflation may lead to a decline in value. If interest rates rise due to reasons other than inflation (for example, due to","page_number":41,"box":{"x":70,"y":211,"width":825,"height":11}},{"id":"c4b4a8c4-8b40-4306-96ab-cccec239c4d1","block_type":"box","text":"changes in currency exchange rates), investors in these securities may not be protected to the extent that the","page_number":41,"box":{"x":69,"y":226,"width":784,"height":11}},{"id":"def6e7b9-9c30-4fd6-9774-250980e299ca","block_type":"box","text":"increase is not reflected in the bond’s inflation measure.","page_number":41,"box":{"x":70,"y":241,"width":403,"height":9}},{"id":"5b00e8db-64bc-405d-ab6f-2ad7537a03c4","block_type":"box","text":"In general, the measure used to determine the periodic adjustment of U.S. inflation-indexed bonds is the","page_number":41,"box":{"x":102,"y":264,"width":746,"height":11}},{"id":"762fedf6-e6c6-4c47-899a-979c1d21a139","block_type":"box","text":"Consumer Price Index for Urban Consumers (“CPI-U”), which is calculated monthly by the U.S. Bureau of Labor","page_number":41,"box":{"x":69,"y":279,"width":786,"height":11}},{"id":"c9fbf49f-30cc-42ae-947f-3317d0541528","block_type":"box","text":"Statistics. The CPI-U is a measurement of changes in the cost of living, made up of components such as housing,","page_number":41,"box":{"x":69,"y":294,"width":810,"height":11}},{"id":"ae22203c-6702-44ad-a6e3-da60d0ea9ec9","block_type":"box","text":"food, transportation and energy. Inflation-indexed bonds issued by a foreign government are generally adjusted to","page_number":41,"box":{"x":68,"y":309,"width":809,"height":11}},{"id":"8d45acba-4384-4693-8b6e-d030f8aeb457","block_type":"box","text":"reflect a comparable inflation index, calculated by that government. There can be no assurance that the CPI-U or any","page_number":41,"box":{"x":69,"y":324,"width":830,"height":12}},{"id":"1e662aa0-1375-43e9-8610-25ad9aea0a73","block_type":"box","text":"foreign inflation index will accurately measure the real rate of inflation in the prices of goods and services. Moreover,","page_number":41,"box":{"x":68,"y":339,"width":833,"height":12}},{"id":"f95da601-9791-4e27-9920-bd8ba46efedc","block_type":"box","text":"there can be no assurance that the rate of inflation in a foreign country will be correlated to the rate of inflation in the","page_number":41,"box":{"x":68,"y":355,"width":840,"height":11}},{"id":"87ff1963-9a09-4189-938b-007ba5a4804f","block_type":"box","text":"United States.","page_number":41,"box":{"x":70,"y":370,"width":99,"height":9}},{"id":"f479d6e4-2614-406b-8872-2cf40cd80098","block_type":"box","text":"Any increase in the principal amount of an inflation-indexed bond will be considered taxable ordinary income,","page_number":41,"box":{"x":101,"y":392,"width":774,"height":12}},{"id":"5d028308-b349-457c-a0de-c4b8954d3de3","block_type":"box","text":"even though investors do not receive their principal until maturity.","page_number":41,"box":{"x":69,"y":408,"width":464,"height":11}},{"id":"d0e08cb5-822e-4af9-95a5-6854cc452838","block_type":"box","text":"Investment Grade Debt Obligations.","page_number":41,"box":{"x":102,"y":430,"width":252,"height":11}},{"id":"0d676704-15df-4fc1-b669-5ad64aa9e25e","block_type":"box","text":"Certain Funds may invest in “investment grade securities,” which are","page_number":41,"box":{"x":360,"y":430,"width":493,"height":11}},{"id":"8e1dfa8a-b8ad-4af4-ad17-b21466c66593","block_type":"box","text":"securities rated in the four highest rating categories of an NRSRO or deemed to be of equivalent quality by a Fund’s","page_number":41,"box":{"x":69,"y":445,"width":823,"height":12}},{"id":"8347d45d-be5c-4138-97fa-06691ee1b223","block_type":"box","text":"Manager. Certain Funds may invest in debt securities rated Aaa by Moody’s or AAA by S&P. It should be noted that","page_number":41,"box":{"x":70,"y":460,"width":815,"height":12}},{"id":"c3279bb5-fbf2-4774-85c9-99e7e7626b1f","block_type":"box","text":"debt obligations rated in the lowest of the top four ratings (","page_number":41,"box":{"x":69,"y":475,"width":420,"height":12}},{"id":"3b31c303-922b-4360-a566-8f77cea92921","block_type":"box","text":"i.e.","page_number":41,"box":{"x":492,"y":476,"width":20,"height":8}},{"id":"c3c2a53a-e3d9-4a77-aa4d-e68c9a87aeb0","block_type":"box","text":", “Baa” by Moody’s or “BBB” by S&P) are considered","page_number":41,"box":{"x":514,"y":476,"width":377,"height":11}},{"id":"435cac49-5b42-4ada-94bd-b7efc96035e4","block_type":"box","text":"to have some speculative characteristics and are more sensitive to economic change than higher rated securities. If","page_number":41,"box":{"x":68,"y":491,"width":829,"height":11}},{"id":"44fc383a-4e2f-43b8-8408-82b433cd9a8d","block_type":"box","text":"an investment grade security of a Fund is subsequently downgraded below investment grade, the Fund’s Manager will","page_number":41,"box":{"x":69,"y":506,"width":836,"height":11}},{"id":"763f38fe-6c84-4f66-b03d-e00fb077ab10","block_type":"box","text":"consider such an event in determining whether the Fund should continue to hold the security. Subject to its","page_number":41,"box":{"x":69,"y":521,"width":763,"height":11}},{"id":"d043e489-bbe0-4067-959d-f1ad301409e0","block_type":"box","text":"investment strategies, there is no limit on the amount of such downgraded securities a Fund may hold.","page_number":41,"box":{"x":70,"y":536,"width":731,"height":11}},{"id":"e9b54d88-6ef2-4f15-91ba-cc9f53f0bc1b","block_type":"box","text":"See Appendix A to this SAI for a description of applicable securities ratings.","page_number":41,"box":{"x":102,"y":559,"width":536,"height":11}},{"id":"83ae6b96-e4d3-4ef8-ac97-3617cda94aa2","block_type":"box","text":"High Yield Investments (“Junk Bonds”).","page_number":41,"box":{"x":102,"y":582,"width":278,"height":11}},{"id":"5e492588-4ee4-4dc2-873b-9c2b12164b05","block_type":"box","text":"Non-investment grade or “high yield” fixed-income or convertible securities commonly known to investors as","page_number":41,"box":{"x":102,"y":604,"width":767,"height":11}},{"id":"4627ec35-91b3-4407-9b1d-5181c4488778","block_type":"box","text":"“junk bonds” are debt securities that are rated below investment grade by the major rating agencies or are securities","page_number":41,"box":{"x":70,"y":619,"width":834,"height":11}},{"id":"388d0979-3c3d-4259-b141-50b3f05e23de","block_type":"box","text":"that Fund management believes are of comparable quality. While generally providing greater income and opportunity","page_number":41,"box":{"x":68,"y":634,"width":828,"height":12}},{"id":"a4a8b446-3cac-47e1-baa5-bab03b44e46e","block_type":"box","text":"for gain, non-investment grade debt securities may be subject to greater risks than securities which have higher credit","page_number":41,"box":{"x":68,"y":649,"width":841,"height":12}},{"id":"300d20a0-46e9-4c85-b066-f646449622cb","block_type":"box","text":"ratings, including a high risk of default, and their yields will fluctuate over time. High yield securities will generally be","page_number":41,"box":{"x":69,"y":664,"width":827,"height":12}},{"id":"99763a2d-6c14-42fe-bd16-7325ff40794e","block_type":"box","text":"in the lower rating categories of recognized rating agencies (rated “Ba” or lower by Moody’s or “BB” or lower by S&P)","page_number":41,"box":{"x":70,"y":680,"width":830,"height":11}},{"id":"54cb1f38-d615-44fd-8227-de5589ec86d9","block_type":"box","text":"or will be non-rated. The credit rating of a high yield security does not necessarily address its market value risk, and","page_number":41,"box":{"x":69,"y":695,"width":824,"height":11}},{"id":"ef2f1e0b-7b8d-4a83-8720-a13bb8b7cd82","block_type":"box","text":"ratings may from time to time change, positively or negatively, to reflect developments regarding the issuer’s financial","page_number":41,"box":{"x":69,"y":710,"width":838,"height":11}},{"id":"e601f970-4530-4f4a-9130-6665356fc567","block_type":"box","text":"condition. High yield securities are considered to be speculative with respect to the capacity of the issuer to timely","page_number":41,"box":{"x":69,"y":725,"width":817,"height":11}},{"id":"40aba9fb-99bc-42d5-93f5-14288d20c721","block_type":"box","text":"repay principal and pay interest or dividends in accordance with the terms of the obligation and may have more credit","page_number":41,"box":{"x":69,"y":740,"width":837,"height":11}},{"id":"540ed34b-921e-421d-85cb-d11d81eb9189","block_type":"box","text":"risk than higher rated securities.","page_number":41,"box":{"x":69,"y":755,"width":230,"height":11}},{"id":"8ff273a0-251e-4acd-81f5-3372f5d1933f","block_type":"box","text":"The major risks in junk bond investments include the following:","page_number":41,"box":{"x":101,"y":778,"width":447,"height":11}},{"id":"15fcb4d0-fd41-4d29-895f-bec1e2e38d8e","block_type":"box","text":"•","page_number":41,"box":{"x":69,"y":801,"width":6,"height":4}},{"id":"58eb3075-014d-4cbd-86c2-5c87d091031a","block_type":"box","text":"Junk bonds may be issued by less creditworthy companies. These securities are vulnerable to adverse changes","page_number":41,"box":{"x":101,"y":798,"width":796,"height":11}},{"id":"f6ae0526-67dd-489a-ade4-c933f0a98838","block_type":"box","text":"in the issuer’s industry and to general economic conditions. Issuers of junk bonds may be unable to meet their","page_number":41,"box":{"x":102,"y":813,"width":792,"height":11}},{"id":"61b5bc0a-e9f2-466b-b2bf-36b9fc0f4671","block_type":"box","text":"interest or principal payment obligations because of an economic downturn, specific issuer developments or the","page_number":41,"box":{"x":102,"y":828,"width":799,"height":12}},{"id":"d3dd6ce1-7018-47ee-8429-50176f33c204","block_type":"box","text":"unavailability of additional financing.","page_number":41,"box":{"x":102,"y":843,"width":256,"height":12}},{"id":"cb4ffd9e-a006-4040-a191-44ac37e2c2c5","block_type":"box","text":"•","page_number":41,"box":{"x":69,"y":866,"width":6,"height":5}},{"id":"adbc3b03-b037-4298-a613-05f3586fdfbd","block_type":"box","text":"The issuers of junk bonds may have a larger amount of outstanding debt relative to their assets than issuers of","page_number":41,"box":{"x":101,"y":863,"width":797,"height":12}},{"id":"f22e5951-6dad-4339-a96e-ecfa743fc010","block_type":"box","text":"investment grade bonds. If the issuer experiences financial stress, it may be unable to meet its debt obligations.","page_number":41,"box":{"x":102,"y":879,"width":804,"height":11}},{"id":"2a633b75-1641-4595-a6be-8b97da3876d1","block_type":"box","text":"The issuer’s ability to pay its debt obligations also may be lessened by specific issuer developments, or the","page_number":41,"box":{"x":101,"y":894,"width":769,"height":11}},{"id":"8683a3fc-460f-45e1-bb7d-14fdba6cd2bb","block_type":"box","text":"II-10","page_number":41,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"3462f474-a8c7-4c81-bcbf-9fba6e9d1ab7","block_type":"box","text":"NM0926U-5977317-41/232","page_number":41,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"934098e0-41b1-45ba-aa12-783ddca39db1","block_type":"box","text":"unavailability of additional financing. Issuers of high yield securities are often in the growth stage of their","page_number":42,"box":{"x":102,"y":45,"width":746,"height":11}},{"id":"16ef5136-5272-4d60-aaa9-b24b6da1b958","block_type":"box","text":"development and/or involved in a reorganization or takeover.","page_number":42,"box":{"x":101,"y":60,"width":432,"height":11}},{"id":"a95d17c8-2419-4f5c-b76d-a724aa90aefe","block_type":"box","text":"•","page_number":42,"box":{"x":69,"y":83,"width":6,"height":4}},{"id":"2be26f0a-47bc-4560-a3fb-840ac7ef08cd","block_type":"box","text":"Junk bonds are frequently ranked junior to claims by other creditors. If the issuer cannot meet its obligations, the","page_number":42,"box":{"x":101,"y":80,"width":808,"height":11}},{"id":"52ee3d05-f35c-4681-a60a-05b36b46cd92","block_type":"box","text":"senior obligations are generally paid off before the junior obligations, which will potentially limit a Fund’s ability","page_number":42,"box":{"x":102,"y":95,"width":789,"height":11}},{"id":"eecd27dc-e202-4904-bc89-58b330090dae","block_type":"box","text":"to fully recover principal or to receive interest payments when senior securities are in default. Thus, investors in","page_number":42,"box":{"x":101,"y":110,"width":796,"height":11}},{"id":"30b0e5af-3401-4d72-9d8e-1a77eb6096e5","block_type":"box","text":"high yield securities have a lower degree of protection with respect to principal and interest payments than do","page_number":42,"box":{"x":102,"y":125,"width":782,"height":12}},{"id":"988cef8c-dd0c-4f7a-b09a-2296132b051e","block_type":"box","text":"investors in higher rated securities.","page_number":42,"box":{"x":102,"y":141,"width":249,"height":11}},{"id":"c9072d5d-b2c2-4bca-a8cf-746ae3ec6cc6","block_type":"box","text":"•","page_number":42,"box":{"x":69,"y":163,"width":6,"height":5}},{"id":"fe10bf01-b8ea-45b5-b0b6-bea8a87c4229","block_type":"box","text":"Junk bonds frequently have redemption features that permit an issuer to repurchase the security from a Fund","page_number":42,"box":{"x":101,"y":161,"width":780,"height":11}},{"id":"0fda3b24-1652-4fb4-9170-864782feec87","block_type":"box","text":"before it matures. If an issuer redeems the junk bonds, a Fund may have to invest the proceeds in bonds with","page_number":42,"box":{"x":102,"y":176,"width":784,"height":11}},{"id":"3a25ea29-d6e6-4322-b245-56ac7734d7ce","block_type":"box","text":"lower yields and may lose income.","page_number":42,"box":{"x":102,"y":191,"width":242,"height":11}},{"id":"cd62d959-b69d-4d72-8927-89e740f66e8e","block_type":"box","text":"•","page_number":42,"box":{"x":69,"y":214,"width":6,"height":4}},{"id":"e337dc26-5499-41b7-9360-f621467bcc3a","block_type":"box","text":"Prices of junk bonds are subject to extreme price fluctuations. Negative economic developments may have a","page_number":42,"box":{"x":102,"y":211,"width":772,"height":11}},{"id":"b2ff6b0f-59e0-4313-9393-a1a179a14f0b","block_type":"box","text":"greater impact on the prices of junk bonds than on those of other higher rated fixed-income securities.","page_number":42,"box":{"x":101,"y":226,"width":729,"height":11}},{"id":"2828304e-9a6b-474d-afd1-520b8c57af83","block_type":"box","text":"•","page_number":42,"box":{"x":69,"y":249,"width":6,"height":5}},{"id":"a7e8c26a-17ab-4d72-8983-01b44be669f2","block_type":"box","text":"Junk bonds may be less liquid than higher rated fixed-income securities even under normal economic conditions.","page_number":42,"box":{"x":101,"y":246,"width":802,"height":11}},{"id":"09f221b8-24fe-4b4e-a64a-32c2275027db","block_type":"box","text":"Under certain economic and/or market conditions, a Fund may have difficulty disposing of certain high yield","page_number":42,"box":{"x":102,"y":261,"width":768,"height":12}},{"id":"51b9fc65-d194-4270-b437-d2c079c2b7f5","block_type":"box","text":"securities due to the limited number of investors in that sector of the market. There are fewer dealers in the junk","page_number":42,"box":{"x":102,"y":276,"width":805,"height":12}},{"id":"103c4cd1-3678-4d87-9214-f4a26d686ab2","block_type":"box","text":"bond market, and there may be significant differences in the prices quoted for junk bonds by the dealers, and","page_number":42,"box":{"x":102,"y":292,"width":781,"height":11}},{"id":"d5f71122-204f-435d-a419-04f6ac630a96","block_type":"box","text":"such quotations may not be the actual prices available for a purchase or sale. Because junk bonds are less","page_number":42,"box":{"x":102,"y":307,"width":767,"height":11}},{"id":"0927901c-f4e4-4f4d-9111-573873d8959b","block_type":"box","text":"liquid than higher rated bonds, judgment may play a greater role in valuing certain of a Fund’s portfolio securities","page_number":42,"box":{"x":102,"y":322,"width":806,"height":11}},{"id":"6c29eea5-c479-4726-8ea7-4253663df155","block_type":"box","text":"than in the case of securities trading in a more liquid market.","page_number":42,"box":{"x":101,"y":337,"width":436,"height":11}},{"id":"1e1da71f-4ffc-47c4-a443-2d232b4af04d","block_type":"box","text":"•","page_number":42,"box":{"x":69,"y":360,"width":6,"height":5}},{"id":"f0cb6af6-e4ce-46d6-8f7e-dde53395b0c6","block_type":"box","text":"The secondary markets for high yield securities are not as liquid as the secondary markets for higher rated","page_number":42,"box":{"x":101,"y":357,"width":763,"height":11}},{"id":"79151f50-96a7-4c5d-8165-d1e65d4ca085","block_type":"box","text":"securities. The secondary markets for high yield securities are concentrated in relatively few market makers and","page_number":42,"box":{"x":102,"y":372,"width":798,"height":11}},{"id":"0dea089e-7188-41cc-bc37-baf1548e9e27","block_type":"box","text":"participants in the markets are mostly institutional investors, including insurance companies, banks, other","page_number":42,"box":{"x":102,"y":388,"width":759,"height":11}},{"id":"9aaa4709-02f6-49dc-b073-38e76a3f7a34","block_type":"box","text":"financial institutions and mutual funds. In addition, the trading volume for high yield securities is generally lower","page_number":42,"box":{"x":101,"y":402,"width":798,"height":12}},{"id":"d4c19244-2332-460a-98ba-6a06d63f59f9","block_type":"box","text":"than that for higher rated securities and the secondary markets could contract under adverse market or","page_number":42,"box":{"x":101,"y":418,"width":739,"height":11}},{"id":"c3b55de3-46ca-4bd0-ba73-c5be74e61d29","block_type":"box","text":"economic conditions independent of any specific adverse changes in the condition of a particular issuer. Under","page_number":42,"box":{"x":101,"y":433,"width":792,"height":11}},{"id":"42c91544-ee13-4391-96ef-b462c985622e","block_type":"box","text":"certain economic and/or market conditions, a Fund may have difficulty disposing of certain high yield securities","page_number":42,"box":{"x":101,"y":448,"width":797,"height":11}},{"id":"a00e267a-8319-4dd8-b8db-e94bed888a99","block_type":"box","text":"due to the limited number of investors in that sector of the market. An illiquid secondary market may adversely","page_number":42,"box":{"x":101,"y":463,"width":791,"height":11}},{"id":"d215ac62-87c8-4eb7-8caa-4ad5a51cc594","block_type":"box","text":"affect the market price of the high yield security, which may result in increased difficulty selling the particular","page_number":42,"box":{"x":102,"y":478,"width":777,"height":11}},{"id":"1424d46c-204b-4022-9cf8-0681191a98de","block_type":"box","text":"issue and obtaining accurate market quotations on the issue when valuing a Fund’s assets. Market quotations","page_number":42,"box":{"x":102,"y":493,"width":788,"height":11}},{"id":"3a47133b-51be-4859-84ff-ef2cc2027477","block_type":"box","text":"on high yield securities are available only from a limited number of dealers, and such quotations may not be the","page_number":42,"box":{"x":102,"y":508,"width":797,"height":12}},{"id":"e281e1fb-7506-49a7-8466-33e16781b390","block_type":"box","text":"actual prices available for a purchase or sale. When the secondary market for high yield securities becomes","page_number":42,"box":{"x":102,"y":523,"width":769,"height":12}},{"id":"1168efba-29c0-419f-a30a-bd2dfec595be","block_type":"box","text":"more illiquid, or in the absence of readily available market quotations for such securities, the relative lack of","page_number":42,"box":{"x":102,"y":538,"width":772,"height":12}},{"id":"6da8e5ff-ae1a-49a0-aecc-66c1c1ad62e3","block_type":"box","text":"reliable objective data makes it more difficult to value a Fund’s securities, and judgment plays a more important","page_number":42,"box":{"x":102,"y":554,"width":801,"height":11}},{"id":"906ed402-50bb-4330-9017-b63648779010","block_type":"box","text":"role in determining such valuations.","page_number":42,"box":{"x":102,"y":569,"width":252,"height":11}},{"id":"d0710e5e-625f-4136-9c73-a5735c1314b2","block_type":"box","text":"•","page_number":42,"box":{"x":69,"y":592,"width":6,"height":4}},{"id":"bdddea2d-f3f9-4785-960b-5a1cdd0e69be","block_type":"box","text":"A Fund may incur expenses to the extent necessary to seek recovery upon default or to negotiate new terms with","page_number":42,"box":{"x":101,"y":589,"width":808,"height":11}},{"id":"7ec9cf5b-4dd5-445c-a881-836551a24436","block_type":"box","text":"a defaulting issuer.","page_number":42,"box":{"x":102,"y":604,"width":134,"height":11}},{"id":"01c02453-8774-4ff3-8fe1-144a4fd107ad","block_type":"box","text":"•","page_number":42,"box":{"x":69,"y":627,"width":6,"height":5}},{"id":"b8db1c2a-e598-49cd-bdba-f62b60636111","block_type":"box","text":"The junk bond markets may react strongly to adverse news about an issuer or the economy, or to the perception","page_number":42,"box":{"x":101,"y":624,"width":800,"height":11}},{"id":"ffc33af7-c29e-47b8-b069-ae31c07271b4","block_type":"box","text":"or expectation of adverse news, whether or not it is based on fundamental analysis. Additionally, prices for high","page_number":42,"box":{"x":102,"y":639,"width":793,"height":12}},{"id":"00cd7e18-de04-4460-a692-6d443e731f07","block_type":"box","text":"yield securities may be affected by legislative and regulatory developments. These developments could adversely","page_number":42,"box":{"x":101,"y":654,"width":808,"height":12}},{"id":"f157cf37-54af-49cd-add2-176f99936d5c","block_type":"box","text":"affect a Fund’s NAV and investment practices, the secondary market for high yield securities, the financial","page_number":42,"box":{"x":102,"y":669,"width":756,"height":12}},{"id":"5184839e-2725-4a53-8ce3-bc293a5b3045","block_type":"box","text":"condition of issuers of these securities and the value and liquidity of outstanding high yield securities, especially","page_number":42,"box":{"x":101,"y":685,"width":803,"height":11}},{"id":"bde8c06e-2cdb-4557-92ac-b0e5de2cfe91","block_type":"box","text":"in a thinly traded market. For example, federal legislation requiring the divestiture by federally insured savings","page_number":42,"box":{"x":102,"y":700,"width":781,"height":11}},{"id":"36c6fb1d-3569-42a5-9e96-185a2a27566f","block_type":"box","text":"and loan associations of their investments in high yield bonds and limiting the deductibility of interest by certain","page_number":42,"box":{"x":102,"y":715,"width":798,"height":11}},{"id":"4b3ff6e4-10fe-41a2-b785-8ef1d8a53009","block_type":"box","text":"corporate issuers of high yield bonds adversely affected the market in the past.","page_number":42,"box":{"x":101,"y":730,"width":566,"height":11}},{"id":"6be21cc5-4c58-46d8-9027-0879d26bd7e5","block_type":"box","text":"•","page_number":42,"box":{"x":69,"y":753,"width":6,"height":5}},{"id":"c2a3c508-2ce0-4284-928d-30b5e43bf909","block_type":"box","text":"The rating assigned by a rating agency evaluates the issuing agency’s assessment of the safety of a non","page_number":42,"box":{"x":101,"y":750,"width":751,"height":11}},{"id":"0485ce23-8d6c-4d60-b118-0c28282b064e","block_type":"box","text":"investment grade security’s principal and interest payments, but does not address market value risk. Because","page_number":42,"box":{"x":102,"y":766,"width":786,"height":11}},{"id":"5b69508e-8744-4098-8d97-a86d11962faa","block_type":"box","text":"such ratings of the ratings agencies may not always reflect current conditions and events, in addition to using","page_number":42,"box":{"x":102,"y":780,"width":782,"height":12}},{"id":"4ea8f821-b0fa-4c30-a786-b19bea1f2aaa","block_type":"box","text":"recognized rating agencies and other sources, the Manager or sub-adviser performs its own analysis of the","page_number":42,"box":{"x":102,"y":795,"width":762,"height":12}},{"id":"15dbca17-ee49-4463-aa26-743f15b10935","block_type":"box","text":"issuers whose non-investment grade securities a Fund holds. Because of this, the Fund’s performance may","page_number":42,"box":{"x":102,"y":811,"width":767,"height":11}},{"id":"ad9dcdeb-717b-443a-a7d9-708d67adc4c2","block_type":"box","text":"depend more on the Manager’s or sub-adviser’s own credit analysis than in the case of mutual funds investing in","page_number":42,"box":{"x":101,"y":826,"width":806,"height":11}},{"id":"47ac40c1-152f-4020-963e-fbe6c2d92183","block_type":"box","text":"higher-rated securities.","page_number":42,"box":{"x":102,"y":841,"width":161,"height":11}},{"id":"952ca85c-7993-48bf-b1dd-edef8c57dde3","block_type":"box","text":"In selecting non-investment grade securities, the Manager or sub-adviser considers factors such as those","page_number":42,"box":{"x":102,"y":863,"width":751,"height":12}},{"id":"2bd68339-7d07-4d26-b9ef-a9af74bc19d1","block_type":"box","text":"relating to the creditworthiness of issuers, the ratings and performance of the securities, the protections afforded","page_number":42,"box":{"x":69,"y":879,"width":814,"height":11}},{"id":"16aaa2b5-5d9e-4f42-aca0-c4cb353b66fd","block_type":"box","text":"the securities and the diversity of the Fund. The Manager or sub-adviser continuously monitors the issuers of non","page_number":42,"box":{"x":68,"y":894,"width":812,"height":11}},{"id":"e95ccab6-1751-4299-93fa-46d6bd5c12f9","block_type":"box","text":"investment grade securities held by the Fund for their ability to make required principal and interest payments, as","page_number":42,"box":{"x":70,"y":909,"width":808,"height":11}},{"id":"651b6d5b-4145-49ff-931b-ae02b69d0231","block_type":"box","text":"II-11","page_number":42,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"f803ef81-50a6-4101-920b-43c9d054e23e","block_type":"box","text":"NM0926U-5977317-42/232","page_number":42,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"1d30b65b-4e22-4245-8af5-dbc43736e3c2","block_type":"box","text":"well as in an effort to control the liquidity of the Fund so that it can meet redemption requests. If a security’s rating","page_number":43,"box":{"x":68,"y":45,"width":825,"height":11}},{"id":"57faea1d-847f-4ddd-bbfd-c6009d1826c7","block_type":"box","text":"is reduced below the minimum credit rating that is permitted for a Fund, the Fund’s adviser or sub-adviser will","page_number":43,"box":{"x":70,"y":60,"width":779,"height":11}},{"id":"cf47049e-7404-4fcf-972d-8d35a6657d72","block_type":"box","text":"consider whether the Fund should continue to hold the security.","page_number":43,"box":{"x":69,"y":75,"width":451,"height":11}},{"id":"0a21f9d5-a7aa-417b-89b7-46b9534f870a","block_type":"box","text":"In the event that a Fund investing in high yield securities experiences an unexpected level of net redemptions,","page_number":43,"box":{"x":102,"y":98,"width":782,"height":11}},{"id":"febd57e1-da77-46be-a350-7849693e7b80","block_type":"box","text":"the Fund could be forced to sell its holdings without regard to the investment merits, thereby decreasing the assets","page_number":43,"box":{"x":68,"y":113,"width":825,"height":11}},{"id":"044274eb-a7e1-4211-a85e-f8e34fc93e2f","block_type":"box","text":"upon which the Fund’s rate of return is based.","page_number":43,"box":{"x":69,"y":128,"width":328,"height":11}},{"id":"bed69b4b-cb75-488e-a9fd-ab1e66fe343f","block_type":"box","text":"The costs attributable to investing in the junk bond markets are usually higher for several reasons, such as","page_number":43,"box":{"x":101,"y":150,"width":764,"height":12}},{"id":"373382a7-6bb7-4064-824b-d6bc197dd713","block_type":"box","text":"higher investment research costs and higher commission costs.","page_number":43,"box":{"x":69,"y":166,"width":455,"height":11}},{"id":"2086009c-d72c-4b6d-b57c-ab3f7bd7ce6c","block_type":"box","text":"Mezzanine Investments.","page_number":43,"box":{"x":102,"y":188,"width":170,"height":9}},{"id":"4054e5fd-03db-4512-a1c9-607bf5714c73","block_type":"box","text":"Certain Funds, consistent with their restrictions on investing in securities of a specific","page_number":43,"box":{"x":279,"y":188,"width":612,"height":12}},{"id":"8884d4a2-7d82-4e57-b217-a4ddc4c4c4cf","block_type":"box","text":"credit quality, may invest in certain high yield securities known as mezzanine investments, which are subordinated","page_number":43,"box":{"x":69,"y":204,"width":813,"height":11}},{"id":"5cb0b564-431d-403e-861c-f51f1dc6f7ef","block_type":"box","text":"debt securities which are generally issued in private placements in connection with an equity security (","page_number":43,"box":{"x":69,"y":219,"width":729,"height":11}},{"id":"b08cb315-3edc-4ca8-ada1-da14ee431cca","block_type":"box","text":"e.g.","page_number":43,"box":{"x":800,"y":220,"width":24,"height":10}},{"id":"cb099970-feda-4780-ae66-eaf2edca673c","block_type":"box","text":", with","page_number":43,"box":{"x":827,"y":219,"width":36,"height":10}},{"id":"a91d4e06-22c4-49fd-8e54-bbc489777ec5","block_type":"box","text":"attached warrants). Such mezzanine investments may be issued with or without registration rights. Similar to other","page_number":43,"box":{"x":69,"y":234,"width":818,"height":11}},{"id":"0dac75c1-bc24-436b-b6f4-43d1dc9a3f38","block_type":"box","text":"high yield securities, maturities of mezzanine investments are typically seven to ten years, but the expected average","page_number":43,"box":{"x":69,"y":249,"width":827,"height":11}},{"id":"fd058a4d-a328-44ab-a2ac-c58007fed0f6","block_type":"box","text":"life is significantly shorter at three to five years. Mezzanine investments are usually unsecured and subordinate to","page_number":43,"box":{"x":70,"y":264,"width":813,"height":11}},{"id":"f956be85-59e9-4dc2-86ae-d7cb2fe26d40","block_type":"box","text":"other obligations of the issuer.","page_number":43,"box":{"x":69,"y":279,"width":216,"height":11}},{"id":"eb457267-e5b4-40ed-bbba-bcfbed0e9367","block_type":"box","text":"Pay-in-kind Bonds.","page_number":43,"box":{"x":102,"y":302,"width":127,"height":11}},{"id":"d1055ec4-95c2-4299-a248-dcdcde20427a","block_type":"box","text":"Certain Funds may invest in pay-in-kind, or PIK, bonds. PIK bonds are bonds which pay","page_number":43,"box":{"x":236,"y":302,"width":615,"height":11}},{"id":"d1959e18-7212-47ea-a3b7-f5c4e6cd623d","block_type":"box","text":"interest through the issuance of additional debt or equity securities. Similar to zero coupon obligations, pay-in-kind","page_number":43,"box":{"x":70,"y":317,"width":813,"height":11}},{"id":"db7d3d96-7591-47b4-8c57-0ae50494ab4f","block_type":"box","text":"bonds also carry additional risk as holders of these types of securities realize no cash until the cash payment date","page_number":43,"box":{"x":69,"y":332,"width":820,"height":11}},{"id":"27c3ae52-5b3f-4e3c-bcd0-32496647912c","block_type":"box","text":"unless a portion of such securities is sold and, if the issuer defaults, a Fund may obtain no return at all on its","page_number":43,"box":{"x":69,"y":347,"width":784,"height":11}},{"id":"cbb17be8-bc90-4866-b093-b90c3b182bbb","block_type":"box","text":"investment. The market price of pay-in-kind bonds is affected by interest rate changes to a greater extent, and","page_number":43,"box":{"x":70,"y":362,"width":783,"height":11}},{"id":"3f012912-e4b0-4157-9741-ad9fb00bde45","block_type":"box","text":"therefore tends to be more volatile, than that of securities which pay interest in cash. Additionally, current U.S.","page_number":43,"box":{"x":68,"y":377,"width":790,"height":11}},{"id":"396b4011-0365-4a27-8267-09b50e329df0","block_type":"box","text":"federal tax law requires the holder of pay-in-kind bonds to accrue income with respect to these securities prior to the","page_number":43,"box":{"x":68,"y":392,"width":831,"height":12}},{"id":"3c8a7cce-15e4-451f-bcdc-99c7ce28e990","block_type":"box","text":"receipt of cash payments. To maintain its qualification as a regulated investment company and avoid liability for U.S.","page_number":43,"box":{"x":69,"y":407,"width":830,"height":12}},{"id":"824a4552-7743-4481-ba56-927675f63d93","block_type":"box","text":"federal income and excise taxes, each Fund may be required to distribute income accrued with respect to these","page_number":43,"box":{"x":68,"y":423,"width":798,"height":11}},{"id":"bc951d33-2cf3-402e-ad62-2f34a90a3709","block_type":"box","text":"securities and may have to dispose of portfolio securities under disadvantageous circumstances in order to generate","page_number":43,"box":{"x":69,"y":438,"width":835,"height":11}},{"id":"92da3fb0-0b8a-4099-afee-eab267805d39","block_type":"box","text":"cash to satisfy these distribution requirements.","page_number":43,"box":{"x":69,"y":453,"width":336,"height":11}},{"id":"3b89df0d-38ed-45e7-95ea-a64bda76673f","block_type":"box","text":"Supranational Entities.","page_number":43,"box":{"x":102,"y":476,"width":160,"height":10}},{"id":"17e61f8a-5466-4173-ba21-672391605856","block_type":"box","text":"A Fund may invest in debt securities of supranational entities. Examples of such entities","page_number":43,"box":{"x":268,"y":475,"width":629,"height":12}},{"id":"75622807-399b-4b20-a08d-e5722f02d808","block_type":"box","text":"include the International Bank for Reconstruction and Development (the World Bank), the European Steel and Coal","page_number":43,"box":{"x":70,"y":491,"width":814,"height":11}},{"id":"1f40e587-90d1-4b6d-a1e9-47717ce05376","block_type":"box","text":"Community, the Asian Development Bank and the Inter-American Development Bank. The government members, or","page_number":43,"box":{"x":69,"y":506,"width":817,"height":11}},{"id":"fbb302fd-5290-4461-a9d5-288bb756bb46","block_type":"box","text":"“stockholders,” usually make initial capital contributions to the supranational entity and in many cases are","page_number":43,"box":{"x":70,"y":521,"width":759,"height":11}},{"id":"339109e4-5edb-42c9-8a4c-49f061a1007d","block_type":"box","text":"committed to make additional capital contributions if the supranational entity is unable to repay its borrowings. There","page_number":43,"box":{"x":69,"y":536,"width":836,"height":11}},{"id":"baef6872-83bc-4a61-84af-cae4028215d5","block_type":"box","text":"is no guarantee that one or more stockholders of a supranational entity will continue to make any necessary","page_number":43,"box":{"x":70,"y":551,"width":772,"height":11}},{"id":"7a9d3edb-9ddc-4400-91ad-3de5263e67c2","block_type":"box","text":"additional capital contributions. If such contributions are not made, the entity may be unable to pay interest or repay","page_number":43,"box":{"x":69,"y":566,"width":830,"height":11}},{"id":"dddda8ee-3e67-4e4a-9c4b-bba848ba25f9","block_type":"box","text":"principal on its debt securities, and a Fund may lose money on such investments.","page_number":43,"box":{"x":70,"y":582,"width":580,"height":10}},{"id":"10556c75-4726-4503-a013-85326154ca31","block_type":"box","text":"Depositary Receipts (ADRs, EDRs and GDRs).","page_number":43,"box":{"x":102,"y":604,"width":334,"height":11}},{"id":"005afbf1-b877-4ea4-9e91-dc9b8634f5f1","block_type":"box","text":"Certain Funds may invest in the securities of foreign issuers in","page_number":43,"box":{"x":442,"y":604,"width":446,"height":11}},{"id":"3109c850-54ed-4aa2-ab7d-c48e3d2156e4","block_type":"box","text":"the form of Depositary Receipts or other securities convertible into securities of foreign issuers. Depositary Receipts","page_number":43,"box":{"x":68,"y":619,"width":835,"height":11}},{"id":"8fbc5b5c-6a34-438c-87e8-4c69e31a467f","block_type":"box","text":"may not necessarily be denominated in the same currency as the underlying securities into which they may be","page_number":43,"box":{"x":69,"y":634,"width":784,"height":12}},{"id":"e5116dd9-2044-46ff-b6c1-c47e40c891f9","block_type":"box","text":"converted. The Fund may invest in both sponsored and unsponsored American Depositary Receipts (“ADRs”),","page_number":43,"box":{"x":69,"y":650,"width":781,"height":11}},{"id":"ca4a8734-1e73-4b71-b948-68a268ae47d4","block_type":"box","text":"European Depositary Receipts (“EDRs”), Global Depositary Receipts (“GDRs”) and other similar global instruments.","page_number":43,"box":{"x":70,"y":665,"width":823,"height":11}},{"id":"6dc557fe-e3f1-462d-a540-72d692315564","block_type":"box","text":"ADRs typically are issued by an American bank or trust company and evidence ownership of underlying securities","page_number":43,"box":{"x":68,"y":680,"width":804,"height":11}},{"id":"4bcc635d-4964-4b66-8ae9-49bbf85b2200","block_type":"box","text":"issued by a foreign corporation. EDRs, which are sometimes referred to as Continental Depositary Receipts, are","page_number":43,"box":{"x":70,"y":695,"width":799,"height":11}},{"id":"6c0d228d-9b4e-45d5-b5ad-7a1aaa07eebd","block_type":"box","text":"receipts issued in Europe, typically by foreign banks and trust companies, that evidence ownership of either foreign","page_number":43,"box":{"x":69,"y":710,"width":821,"height":11}},{"id":"ddb34479-643d-48b0-9c50-f1f2915c9b67","block_type":"box","text":"or domestic underlying securities. GDRs are depositary receipts structured like global debt issues to facilitate trading","page_number":43,"box":{"x":69,"y":725,"width":837,"height":11}},{"id":"3e9e5d9f-848e-48d9-8996-afa96bc922c2","block_type":"box","text":"on an international basis. In addition to investment risks associated with the underlying issuer, Depositary Receipts","page_number":43,"box":{"x":69,"y":740,"width":825,"height":11}},{"id":"5f7feae8-2653-4193-9d04-73693717c01e","block_type":"box","text":"expose a Fund to additional risks associated with the non-uniform terms that apply to Depositary Receipt programs,","page_number":43,"box":{"x":69,"y":755,"width":825,"height":11}},{"id":"bf885ff8-3cd8-4e44-ba67-10181f2532a0","block_type":"box","text":"credit exposure to the depository bank and to the sponsors and other parties with whom the depository bank","page_number":43,"box":{"x":69,"y":771,"width":780,"height":10}},{"id":"f1dc5400-be44-497c-887f-1c45ca233cee","block_type":"box","text":"establishes the programs, currency risk and the risk of an illiquid market for Depositary Receipts. Unsponsored ADR,","page_number":43,"box":{"x":69,"y":785,"width":833,"height":12}},{"id":"6f74afc8-9a98-4e64-80e5-711e103f91ee","block_type":"box","text":"EDR and GDR programs are organized independently and without the cooperation of the issuer of the underlying","page_number":43,"box":{"x":70,"y":801,"width":796,"height":11}},{"id":"cedcd5f7-41f5-4080-967a-fe157cf5c4fc","block_type":"box","text":"securities. Unsponsored programs generally expose investors to greater risks than sponsored programs and do not","page_number":43,"box":{"x":69,"y":816,"width":822,"height":11}},{"id":"582911e5-64b2-4465-9119-003209e6c6eb","block_type":"box","text":"provide holders with many of the shareholder benefits that come from investing in a sponsored Depositary Receipt.","page_number":43,"box":{"x":70,"y":831,"width":820,"height":11}},{"id":"471d9a63-bd9c-4f6e-9b06-8a438fb20ede","block_type":"box","text":"Available information concerning the issuer may not be as current as for sponsored ADRs, EDRs and GDRs, and the","page_number":43,"box":{"x":68,"y":846,"width":827,"height":11}},{"id":"b2d88c02-61ff-4346-a5f2-8c6e53eab07b","block_type":"box","text":"prices of unsponsored ADRs, EDRs and GDRs may be more volatile than if such instruments were sponsored by the","page_number":43,"box":{"x":70,"y":861,"width":825,"height":11}},{"id":"bf27d77c-94d8-4e20-897b-6c3a39d4d246","block_type":"box","text":"issuer. Depositary Receipts are generally subject to the same risks as the foreign securities that they evidence or","page_number":43,"box":{"x":70,"y":876,"width":810,"height":11}},{"id":"45ff2ea8-9078-47e7-9779-bac14cea191b","block_type":"box","text":"into which they may be converted. Investments in ADRs, EDRs and GDRs present additional investment","page_number":43,"box":{"x":70,"y":891,"width":737,"height":11}},{"id":"5567ab50-88fc-4012-9c97-7e090888dae7","block_type":"box","text":"considerations as described under “Foreign Investment Risks.”","page_number":43,"box":{"x":69,"y":907,"width":449,"height":11}},{"id":"600e60d9-d57b-4aac-abb3-122932046919","block_type":"box","text":"II-12","page_number":43,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"e8c62209-3864-4cba-9abd-55f8de0cd441","block_type":"box","text":"NM0926U-5977317-43/232","page_number":43,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"977be051-0cff-4316-b936-6437a6c754f6","block_type":"box","text":"Derivatives.","page_number":44,"box":{"x":102,"y":45,"width":84,"height":9}},{"id":"fd80255e-c801-40dd-b402-21a2b834ae51","block_type":"box","text":"General.","page_number":44,"box":{"x":102,"y":67,"width":58,"height":9}},{"id":"2d1fc5c7-6f6d-4191-82da-274a28876807","block_type":"box","text":"Each Fund may use instruments referred to as derivatives, which are financial instruments that derive","page_number":44,"box":{"x":167,"y":67,"width":725,"height":11}},{"id":"886927bd-46f8-43f5-81f5-38c2fccc87b6","block_type":"box","text":"their value from one or more securities, commodities (such as gold or oil), currencies, interest rates, credit events or","page_number":44,"box":{"x":68,"y":82,"width":836,"height":12}},{"id":"7debf3ba-0286-403c-9c23-749ca6c226b1","block_type":"box","text":"indices (a measure of value or rates, such as the S&P 500 Index or the prime lending rate) or other reference asset.","page_number":44,"box":{"x":70,"y":98,"width":829,"height":11}},{"id":"ca60125a-b613-4e60-b992-892a341383cd","block_type":"box","text":"Derivatives may allow a Fund to increase or decrease the level of risk to which the Fund is exposed more quickly and","page_number":44,"box":{"x":70,"y":113,"width":830,"height":11}},{"id":"af613ba6-804c-467a-9ebf-f471107c760e","block_type":"box","text":"efficiently than with other transactions. Certain Funds may use derivatives to maintain a portion of their long and","page_number":44,"box":{"x":69,"y":128,"width":804,"height":11}},{"id":"81fbe8d9-f9fd-4d04-9c11-095c2224c203","block_type":"box","text":"short positions. Unless otherwise permitted, no Fund may use derivatives to gain exposure to an asset or asset","page_number":44,"box":{"x":69,"y":143,"width":800,"height":11}},{"id":"7e0ed53f-fd99-47cd-9666-07dfd2f454e9","block_type":"box","text":"class it is prohibited by its investment restrictions from purchasing directly. As described below, derivatives can be","page_number":44,"box":{"x":69,"y":158,"width":816,"height":11}},{"id":"474c97d6-ccfe-4381-9cdc-b73f0dcd944f","block_type":"box","text":"used for hedging or speculative purposes. Funds will engage in transaction-level payment netting,","page_number":44,"box":{"x":69,"y":173,"width":691,"height":11}},{"id":"4ebb92c4-561d-44cd-b7f6-732c6500ae2a","block_type":"box","text":"i.e.","page_number":44,"box":{"x":768,"y":173,"width":20,"height":9}},{"id":"2a9d4e75-3152-4352-9727-03aee6005309","block_type":"box","text":", the payment","page_number":44,"box":{"x":791,"y":173,"width":96,"height":11}},{"id":"c6c86823-f195-487c-a3e6-c673ee108838","block_type":"box","text":"obligations of derivatives contracts are netted against one another with the Fund receiving or paying, as the case may","page_number":44,"box":{"x":69,"y":188,"width":839,"height":12}},{"id":"2d1ca1f4-bc5c-427d-827c-f8b69b81ef3a","block_type":"box","text":"be, only the net amount of the two payment streams.","page_number":44,"box":{"x":69,"y":203,"width":378,"height":12}},{"id":"20584c56-09cb-4f64-b2fb-04f90fa4e226","block_type":"box","text":"Hedging.","page_number":44,"box":{"x":102,"y":226,"width":60,"height":11}},{"id":"25d855b0-9f11-4141-b9b1-194cdddda4c5","block_type":"box","text":"Each Fund may use derivatives for hedging purposes, in which a derivative is used to offset the risks","page_number":44,"box":{"x":169,"y":226,"width":717,"height":11}},{"id":"85528248-76e8-4148-9aa9-1c79f04050ec","block_type":"box","text":"associated with other Fund holdings. Losses on other investments may be substantially reduced by gains on a","page_number":44,"box":{"x":69,"y":241,"width":786,"height":11}},{"id":"779d680f-1197-449d-ad83-f1879cac2e97","block_type":"box","text":"derivative that reacts in an opposite manner to market movements. Although hedging may reduce losses, it may also","page_number":44,"box":{"x":69,"y":257,"width":834,"height":11}},{"id":"d6fa77bb-07c4-4db7-b266-5b59c0d5712e","block_type":"box","text":"reduce or eliminate gains. In addition, hedging may cause losses if the market moves in an unanticipated manner, or","page_number":44,"box":{"x":69,"y":271,"width":834,"height":12}},{"id":"fe18b994-fa23-4aee-a6a4-680c91fd2375","block_type":"box","text":"if the cost of the derivative outweighs the benefit of the hedge. The effectiveness of hedging may be reduced by","page_number":44,"box":{"x":70,"y":286,"width":797,"height":12}},{"id":"31295b50-eefe-486e-b720-d3844b329f1d","block_type":"box","text":"correlation risk,","page_number":44,"box":{"x":69,"y":302,"width":109,"height":10}},{"id":"f84cc63c-15ca-43d4-b01a-988e36fc5d5a","block_type":"box","text":"i.e.","page_number":44,"box":{"x":186,"y":302,"width":20,"height":9}},{"id":"89efa19a-c6f6-42f2-a022-e828cce7a728","block_type":"box","text":", the risk that changes in the value of the derivative will not match those of the holdings being","page_number":44,"box":{"x":209,"y":302,"width":669,"height":11}},{"id":"06f96ba0-6f9b-496a-84cc-63e90551542a","block_type":"box","text":"hedged as expected by a Fund, which may result in additional losses to the Fund. The inability to close or offset","page_number":44,"box":{"x":69,"y":317,"width":797,"height":11}},{"id":"1c8c9d31-85ac-48f1-bd47-b314d8b48c43","block_type":"box","text":"derivatives could also reduce the effectiveness of a Fund’s hedging. There is no assurance that a Fund’s hedging will","page_number":44,"box":{"x":69,"y":332,"width":835,"height":11}},{"id":"dc295dca-4b84-488c-89a5-bba9e90074d7","block_type":"box","text":"be effective. No Fund is required to use derivatives to hedge.","page_number":44,"box":{"x":69,"y":347,"width":434,"height":11}},{"id":"7cb2e541-fbdf-43ad-abca-62dba303f64e","block_type":"box","text":"Speculation.","page_number":44,"box":{"x":102,"y":370,"width":86,"height":11}},{"id":"8d4b3fc5-b5ad-46fb-ba5c-01bea1209d9d","block_type":"box","text":"Certain Funds may also use derivatives for speculative purposes to seek to enhance returns. The","page_number":44,"box":{"x":195,"y":370,"width":694,"height":11}},{"id":"06509bb8-cf5b-4a64-aaf0-00a102d4cdef","block_type":"box","text":"use of a derivative is speculative if the Fund is primarily seeking to achieve gains, rather than offset the risk of other","page_number":44,"box":{"x":69,"y":385,"width":831,"height":11}},{"id":"91f3a953-b8c5-4524-866f-37825742fdf7","block_type":"box","text":"positions. To the extent a Fund invests in a derivative for speculative purposes, the Fund will be fully exposed to the","page_number":44,"box":{"x":70,"y":400,"width":824,"height":11}},{"id":"8fe26cda-bf1e-41fb-b08d-5a7afcc69271","block_type":"box","text":"risks of loss of that derivative, which may sometimes be greater than the derivative’s cost, and the potential for loss","page_number":44,"box":{"x":69,"y":415,"width":831,"height":11}},{"id":"30c1e759-bea5-4534-99ab-5a2fe857708b","block_type":"box","text":"in certain cases may be unlimited.","page_number":44,"box":{"x":70,"y":430,"width":243,"height":11}},{"id":"3080d93a-3d12-4d31-ab39-3112476248e7","block_type":"box","text":"Regulation of Derivatives.","page_number":44,"box":{"x":102,"y":453,"width":180,"height":11}},{"id":"fff0e9f4-0dae-46a0-abf5-b3ae59f009c6","block_type":"box","text":"Rule 18f-4 Under the Investment Company Act.","page_number":44,"box":{"x":102,"y":475,"width":333,"height":12}},{"id":"b774b549-0f0a-414d-b67b-2a5551153f10","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to","page_number":44,"box":{"x":442,"y":475,"width":458,"height":12}},{"id":"6377eedb-c85d-41c1-abbb-10996c9904a1","block_type":"box","text":"enter into Derivatives Transactions (as defined below) and certain other transactions notwithstanding the restrictions","page_number":44,"box":{"x":69,"y":491,"width":833,"height":11}},{"id":"9fbe9fba-acb9-4dd6-97a9-40c32e385af4","block_type":"box","text":"on the issuance of “senior securities” under Section 18 of the Investment Company Act. Section 18 of the","page_number":44,"box":{"x":69,"y":506,"width":759,"height":11}},{"id":"6b6154e1-312d-4971-9854-1ba553a50bbf","block_type":"box","text":"Investment Company Act, among other things, prohibits open-end funds, including the Funds, from issuing or selling","page_number":44,"box":{"x":70,"y":521,"width":825,"height":11}},{"id":"acfff6ed-0460-4b23-aa7f-ae3fc96829b6","block_type":"box","text":"any “senior security,” other than borrowing from a bank (subject to a requirement to maintain 300% “asset","page_number":44,"box":{"x":69,"y":536,"width":763,"height":11}},{"id":"79b0d741-950d-4457-aae9-93046ab8568a","block_type":"box","text":"coverage”).","page_number":44,"box":{"x":69,"y":551,"width":79,"height":11}},{"id":"b8c4209c-6114-4505-93da-7e73acf63f27","block_type":"box","text":"Under Rule 18f-4, “Derivatives Transactions” include the following: (1) any swap, security-based swap (including","page_number":44,"box":{"x":102,"y":574,"width":796,"height":11}},{"id":"6bd6a4ca-f5b0-4998-9b4e-37df50b1e123","block_type":"box","text":"a contract for differences), futures contract, forward contract, option (excluding purchased options), any combination","page_number":44,"box":{"x":69,"y":589,"width":832,"height":11}},{"id":"3145d66a-e540-47ae-b6d9-0ac9b3ee7c57","block_type":"box","text":"of the foregoing, or any similar instrument, under which a Fund is or may be required to make any payment or delivery","page_number":44,"box":{"x":69,"y":604,"width":840,"height":11}},{"id":"8736023a-d6d6-4bc1-a06b-34919142bfaa","block_type":"box","text":"of cash or other assets during the life of the instrument or at maturity or early termination, whether as margin or","page_number":44,"box":{"x":69,"y":619,"width":801,"height":11}},{"id":"1d3f91e4-331e-47a0-b4d9-e7760650fe28","block_type":"box","text":"settlement payment or otherwise; (2) any short sale borrowing; (3) reverse repurchase agreements and similar","page_number":44,"box":{"x":69,"y":634,"width":791,"height":12}},{"id":"bc02e8d7-4304-443f-986b-0c03e71ecd6f","block_type":"box","text":"financing transactions (","page_number":44,"box":{"x":68,"y":649,"width":166,"height":12}},{"id":"03457182-2d36-4a2d-895f-5c63989248c5","block_type":"box","text":"e.g.","page_number":44,"box":{"x":236,"y":651,"width":25,"height":10}},{"id":"d5b51391-3302-44a3-894b-e607272c8335","block_type":"box","text":", recourse and non-recourse tender option bonds, and borrowed bonds), if a Fund elects to","page_number":44,"box":{"x":263,"y":649,"width":646,"height":11}},{"id":"564f211f-7ecb-40f9-957e-3753db1ecc5a","block_type":"box","text":"treat all of these transactions as Derivatives Transactions under Rule 18f-4; and (4) when-issued or forward-settling","page_number":44,"box":{"x":68,"y":664,"width":825,"height":12}},{"id":"859ceed2-dd9f-41a3-b93a-88fe4b716b7a","block_type":"box","text":"securities (","page_number":44,"box":{"x":69,"y":680,"width":78,"height":11}},{"id":"a957d167-2879-4203-8c15-649f8d60d542","block_type":"box","text":"e.g.","page_number":44,"box":{"x":148,"y":681,"width":25,"height":10}},{"id":"398c519a-5e16-4a67-a7f3-55fa14e98d3d","block_type":"box","text":", firm and standby commitments, including to-be-announced (“TBA”) commitments, and dollar rolls)","page_number":44,"box":{"x":176,"y":680,"width":704,"height":11}},{"id":"7ea6586d-83cf-4e0b-952c-e91ead679449","block_type":"box","text":"and non-standard settlement cycle securities, unless such transactions meet the Delayed-Settlement Securities","page_number":44,"box":{"x":69,"y":695,"width":796,"height":11}},{"id":"f0076072-d2d5-476f-b17c-24441258612b","block_type":"box","text":"Provision (as defined below under “—When-Issued Securities, Delayed Delivery Securities and Forward","page_number":44,"box":{"x":69,"y":710,"width":732,"height":11}},{"id":"b9b5f4aa-5eef-434d-90a2-164052eba71b","block_type":"box","text":"Commitments”).","page_number":44,"box":{"x":69,"y":725,"width":115,"height":11}},{"id":"1be89ebb-914b-4e8b-be22-ea86e59e80cd","block_type":"box","text":"Unless a Fund is relying on the Limited Derivatives User Exception (as defined below), the Fund must comply with","page_number":44,"box":{"x":102,"y":748,"width":805,"height":11}},{"id":"c3b60844-f1f6-4838-843d-7dbbce298f37","block_type":"box","text":"Rule 18f-4 with respect to its Derivatives Transactions. Rule 18f-4, among other things, requires a Fund to adopt and","page_number":44,"box":{"x":70,"y":763,"width":832,"height":11}},{"id":"b18d00d5-a2aa-4c2e-9778-3e4f98eb4d2c","block_type":"box","text":"implement a comprehensive written derivatives risk management program (“DRMP”) and comply with a relative or","page_number":44,"box":{"x":70,"y":778,"width":808,"height":11}},{"id":"7f04ee56-a902-4e6e-92f4-5c80bcfa8b14","block_type":"box","text":"absolute limit on Fund leverage risk calculated based on value-at-risk (“VaR”). The DRMP is administered by a","page_number":44,"box":{"x":69,"y":793,"width":780,"height":11}},{"id":"b1ac703d-43c1-42a3-90ef-218e8887d16a","block_type":"box","text":"“derivatives risk manager,” who is appointed by the Fund’s Board, including a majority of the independent Directors,","page_number":44,"box":{"x":70,"y":808,"width":824,"height":11}},{"id":"527a3b81-b289-433b-a98d-8ba999232d29","block_type":"box","text":"and periodically reviews the DRMP and reports to the Fund’s Board.","page_number":44,"box":{"x":69,"y":823,"width":482,"height":11}},{"id":"46231161-067f-49ad-ac6b-0ac675915cc9","block_type":"box","text":"Rule 18f-4 provides an exception from the DRMP, VaR limit and certain other requirements if a Fund’s","page_number":44,"box":{"x":102,"y":846,"width":724,"height":11}},{"id":"dc013184-31b4-4c06-b173-ea7b43ed7665","block_type":"box","text":"“derivatives exposure” is limited to 10% of its net assets (as calculated in accordance with Rule 18f-4) and the Fund","page_number":44,"box":{"x":70,"y":861,"width":830,"height":11}},{"id":"33d05b85-8d3d-4392-8353-b4fe7c0d5e15","block_type":"box","text":"adopts and implements written policies and procedures reasonably designed to manage its derivatives risks (the","page_number":44,"box":{"x":69,"y":876,"width":803,"height":11}},{"id":"cdb27c2c-690c-4590-b73c-9ba5522cdb9b","block_type":"box","text":"“Limited Derivatives User Exception”).","page_number":44,"box":{"x":70,"y":891,"width":268,"height":11}},{"id":"60391943-84ac-43ac-8a8e-287040bd345f","block_type":"box","text":"II-13","page_number":44,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"f04deaf5-7c9a-44ba-9e4d-436fd944a95b","block_type":"box","text":"NM0926U-5977317-44/232","page_number":44,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"395d9273-30e5-497e-9ece-0b239f8fdb91","block_type":"box","text":"Dodd-Frank Regulations.","page_number":45,"box":{"x":102,"y":45,"width":171,"height":11}},{"id":"620a8464-998e-4c81-9d77-31446ef2bd29","block_type":"box","text":"The Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”),","page_number":45,"box":{"x":279,"y":45,"width":575,"height":11}},{"id":"d64cc322-830f-46b8-ab42-ca7c1edcaf80","block_type":"box","text":"enacted in July 2010, includes provisions that comprehensively regulate the over-the-counter (“OTC”) derivatives","page_number":45,"box":{"x":69,"y":60,"width":800,"height":11}},{"id":"3b4003d8-92a1-41e0-9596-76d357a69506","block_type":"box","text":"markets for the first time. While the Commodity Futures Trading Commission (“CFTC”) and other U.S. regulators have","page_number":45,"box":{"x":69,"y":75,"width":834,"height":11}},{"id":"8522d6a1-ae7f-4d60-8dd1-0a6914917977","block_type":"box","text":"adopted many of the required Dodd-Frank regulations, certain regulations have only recently become effective and","page_number":45,"box":{"x":69,"y":90,"width":813,"height":11}},{"id":"1ca845dc-88ae-4efe-af24-50ddd97b1c68","block_type":"box","text":"other regulations remain to be adopted. The full impact of Dodd-Frank on the Funds remains uncertain.","page_number":45,"box":{"x":69,"y":105,"width":733,"height":11}},{"id":"baf0fd28-07f5-4905-a56a-3b3f589be247","block_type":"box","text":"Many OTC derivatives dealers are required to register with the CFTC as “swap dealers” and/or with the SEC as","page_number":45,"box":{"x":102,"y":128,"width":789,"height":11}},{"id":"59e19d92-f032-40b4-a1ac-ffbfb8d7f8f0","block_type":"box","text":"“security-based swap dealers”. Registered swap dealers and security-based swap dealers are subject to various","page_number":45,"box":{"x":70,"y":143,"width":797,"height":11}},{"id":"98527d61-a088-4905-8fc6-bcd49d076b5d","block_type":"box","text":"regulatory requirements, including, but not limited to, margin, recordkeeping, reporting, transparency, position limits,","page_number":45,"box":{"x":69,"y":158,"width":833,"height":11}},{"id":"1474260d-209c-4e4a-a4fd-24c862c40f9c","block_type":"box","text":"limitations on conflicts of interest, business conduct standards, minimum capital requirements and other regulatory","page_number":45,"box":{"x":70,"y":173,"width":826,"height":11}},{"id":"1caf2ef5-dce4-434f-9c9e-74ac9de9bb00","block_type":"box","text":"requirements, which indirectly impact the Funds that enter into transactions with them.","page_number":45,"box":{"x":69,"y":188,"width":618,"height":11}},{"id":"69ad895e-a864-4ad8-8b52-a980b1503d77","block_type":"box","text":"The CFTC requires that certain interest rate swaps and certain credit default swaps must be executed in","page_number":45,"box":{"x":101,"y":211,"width":745,"height":11}},{"id":"05474601-0b75-4766-a26a-f8ae869a9059","block_type":"box","text":"regulated markets and be submitted for clearing to regulated clearinghouses. The SEC is also expected to impose","page_number":45,"box":{"x":69,"y":226,"width":813,"height":11}},{"id":"3ea35f9a-a78b-4bfa-bfd8-8009e22e9726","block_type":"box","text":"similar requirements on certain security-based derivatives in the future. OTC derivatives trades submitted for clearing","page_number":45,"box":{"x":69,"y":241,"width":835,"height":11}},{"id":"e177ada3-21e8-414d-9e5a-8f8272e85f49","block_type":"box","text":"are subject to minimum initial and variation margin requirements set by the relevant clearinghouse, as well as margin","page_number":45,"box":{"x":69,"y":257,"width":837,"height":11}},{"id":"76d8d084-a443-4cd5-816e-6d8520876c6a","block_type":"box","text":"requirements mandated by the CFTC, SEC and/or federal prudential regulators. In addition, futures commission","page_number":45,"box":{"x":69,"y":271,"width":794,"height":12}},{"id":"bca9222e-be0f-4a2d-9907-5619e57bf467","block_type":"box","text":"merchants (“FCMs”), who act as clearing members on behalf of customers for cleared OTC derivatives and futures","page_number":45,"box":{"x":69,"y":286,"width":815,"height":12}},{"id":"ee8ce836-7d17-40e5-a9f7-e79fb1d26a07","block_type":"box","text":"contracts, also have discretion to increase a Fund’s margin requirements for these transactions beyond any","page_number":45,"box":{"x":69,"y":302,"width":770,"height":11}},{"id":"39d0c546-3c39-48be-96b5-3c84e74efe02","block_type":"box","text":"regulatory and clearinghouse minimums subject to any restrictions on such discretion in the documentation between","page_number":45,"box":{"x":69,"y":317,"width":831,"height":11}},{"id":"cfdbfefa-9316-4628-b098-6204925a2abb","block_type":"box","text":"the FCM and the customer. These regulatory requirements may make it more difficult and costly for the Funds to","page_number":45,"box":{"x":68,"y":332,"width":804,"height":11}},{"id":"054d8e79-2f8a-41ba-acd7-8cd648a55ec8","block_type":"box","text":"enter into highly tailored or customized transactions, potentially rendering certain investment strategies impossible or","page_number":45,"box":{"x":69,"y":347,"width":839,"height":11}},{"id":"7484d310-cbbc-4762-8613-035edf06f4d8","block_type":"box","text":"not economically feasible. If a Fund decides to execute and clear cleared OTC derivatives and/or futures contracts","page_number":45,"box":{"x":69,"y":362,"width":814,"height":11}},{"id":"dfcaaffe-a54d-43c0-8de1-d4aa80f92382","block_type":"box","text":"through execution facilities, exchanges or clearinghouses, either indirectly through an executing broker, clearing","page_number":45,"box":{"x":68,"y":377,"width":796,"height":12}},{"id":"26465219-1a24-4863-89e3-b7c5ec7412d0","block_type":"box","text":"member FCM or as a direct member, a Fund would be required to comply with the rules of the execution facility,","page_number":45,"box":{"x":69,"y":392,"width":793,"height":12}},{"id":"f34cd467-58e7-4d19-847a-8b3da3a5a184","block_type":"box","text":"exchange or clearinghouse and other applicable law.","page_number":45,"box":{"x":69,"y":408,"width":370,"height":11}},{"id":"2d74bbe7-a230-4e6a-8d1c-0203b3a1e7d4","block_type":"box","text":"With respect to cleared OTC derivatives and futures contracts and options on futures, a Fund will not face a","page_number":45,"box":{"x":101,"y":430,"width":766,"height":11}},{"id":"5d67aae3-b12d-4db3-a357-bd630cdcad89","block_type":"box","text":"clearinghouse directly but rather will do so through a FCM that is registered with the CFTC and/or SEC and that acts","page_number":45,"box":{"x":69,"y":445,"width":826,"height":12}},{"id":"aef7fb3f-9f56-41c9-88b5-e9e67a61b16a","block_type":"box","text":"as a clearing member. A Fund may face the indirect risk of the failure of another clearing member customer to meet","page_number":45,"box":{"x":69,"y":460,"width":825,"height":12}},{"id":"7d7bd77d-97a5-4307-9b63-694a43c51223","block_type":"box","text":"its obligations to its clearing member. Such scenario could arise due to a default by the clearing member on its","page_number":45,"box":{"x":70,"y":475,"width":791,"height":12}},{"id":"b6082446-dfbc-4e6f-9867-caf8b3dee20d","block_type":"box","text":"obligations to the clearinghouse simultaneously with a customer’s failure to meet its obligations to the clearing","page_number":45,"box":{"x":69,"y":491,"width":793,"height":11}},{"id":"31032e5f-bca7-4c83-a932-59b0d7285554","block_type":"box","text":"member.","page_number":45,"box":{"x":69,"y":506,"width":60,"height":9}},{"id":"26351fb7-e1d2-4594-a852-698ac4d5925a","block_type":"box","text":"Clearing member FCMs are required to post initial margin to the clearinghouses through which they clear their","page_number":45,"box":{"x":102,"y":529,"width":782,"height":11}},{"id":"ac517437-80ae-48b8-b8b6-5d92e18701c9","block_type":"box","text":"customers’ cleared OTC derivatives and futures contracts, instead of using such initial margin in their businesses, as","page_number":45,"box":{"x":69,"y":543,"width":837,"height":12}},{"id":"ce3c9e42-5b1f-4db8-bc77-08cfd40efc39","block_type":"box","text":"was widely permitted for OTC derivatives before Dodd-Frank. While an FCM may require its customer to post initial","page_number":45,"box":{"x":68,"y":559,"width":811,"height":11}},{"id":"7fc2ff8e-f640-4595-9615-781ecfb82771","block_type":"box","text":"margin in excess of clearinghouse requirements, and certain clearinghouses may share a portion of their earnings on","page_number":45,"box":{"x":69,"y":574,"width":838,"height":11}},{"id":"2bab9ea7-27f0-4741-847f-1d0bfc2b0840","block_type":"box","text":"initial margin with their clearing members, some portion of the initial margin that is passed through to the","page_number":45,"box":{"x":70,"y":589,"width":754,"height":11}},{"id":"53533216-f76b-4e57-af8f-3b4003fad8ee","block_type":"box","text":"clearinghouse does not generate earnings for the FCM. The inability of FCMs to earn the same levels of returns on","page_number":45,"box":{"x":69,"y":604,"width":815,"height":11}},{"id":"dd9efbbd-efeb-49b1-a856-11213dc8396d","block_type":"box","text":"initial margin for cleared OTC derivatives as they could earn with respect to non-cleared OTC derivatives may cause","page_number":45,"box":{"x":70,"y":619,"width":817,"height":11}},{"id":"282359be-c938-487a-baea-1cdc1fc489ba","block_type":"box","text":"FCMs to charge higher fees, or provide less favorable pricing on cleared OTC derivatives than swap dealers will","page_number":45,"box":{"x":70,"y":634,"width":788,"height":12}},{"id":"c20753f3-fe39-487b-8429-8b886d569789","block_type":"box","text":"provide for non-cleared OTC derivatives. Furthermore, customers, including the Funds, are subject to additional fees","page_number":45,"box":{"x":70,"y":649,"width":825,"height":12}},{"id":"fc4ee8e5-757a-4acc-b855-eb68362eddce","block_type":"box","text":"payable to FCMs with respect to cleared OTC derivatives, which may raise the cost to Funds of clearing as compared","page_number":45,"box":{"x":70,"y":664,"width":829,"height":12}},{"id":"f3cfaf3d-593c-4353-a90b-ba4a0792ef51","block_type":"box","text":"to trading non-cleared OTC derivatives bilaterally.","page_number":45,"box":{"x":68,"y":680,"width":346,"height":11}},{"id":"0f4ddf32-7ee2-4908-8c0a-fe39c5360dd5","block_type":"box","text":"With respect to uncleared swaps, registered swap dealers and security-based swap dealers are required to","page_number":45,"box":{"x":101,"y":703,"width":762,"height":11}},{"id":"47838a5d-8a19-49b5-b2f6-ddf9232eeb1f","block_type":"box","text":"exchange variation margin with a Fund and may be required by applicable regulations to collect (and in some cases","page_number":45,"box":{"x":69,"y":718,"width":820,"height":11}},{"id":"57e9b7fc-75af-4a54-a7c7-78e0baf3642e","block_type":"box","text":"exchange) initial margin with a Fund. Both initial and variation margin may be comprised of cash and/or securities,","page_number":45,"box":{"x":69,"y":732,"width":816,"height":12}},{"id":"7f3ba734-7e88-4e5f-84e7-b3f266eba7b6","block_type":"box","text":"subject to applicable regulatory haircuts and other restrictions. Shares of investment companies (other than certain","page_number":45,"box":{"x":69,"y":748,"width":825,"height":11}},{"id":"b9de25b9-bbf6-40cc-b1d6-be0e45ce32df","block_type":"box","text":"money market funds) may not be posted as collateral under applicable regulations.","page_number":45,"box":{"x":69,"y":763,"width":590,"height":11}},{"id":"60fcb5a6-435c-4e58-a68a-ee2aa42a0492","block_type":"box","text":"The CFTC, certain foreign regulators, and many futures exchanges have established (and continue to evaluate","page_number":45,"box":{"x":101,"y":785,"width":783,"height":12}},{"id":"2e707731-dd8e-4428-ad8c-21a8c42b1730","block_type":"box","text":"and monitor) speculative position limits (“position limits”) on the maximum speculative position which any person, or","page_number":45,"box":{"x":69,"y":801,"width":833,"height":11}},{"id":"b713b19d-2054-46ba-8f8d-e825a072b092","block_type":"box","text":"group of persons acting in concert, may hold or control in particular contracts. In addition, U.S. federal position limits","page_number":45,"box":{"x":68,"y":816,"width":837,"height":11}},{"id":"7f25fba2-997e-498c-8eb2-a6b3bf2b0f49","block_type":"box","text":"apply to swaps that are economically equivalent to futures contracts on certain agricultural, metals and energy","page_number":45,"box":{"x":69,"y":831,"width":789,"height":11}},{"id":"1d033e8d-eb1f-46b6-a12a-56352d083974","block_type":"box","text":"commodities. All positions owned or controlled by the same person or entity, even if in different accounts, must be","page_number":45,"box":{"x":69,"y":846,"width":818,"height":11}},{"id":"11df61ed-46c9-4e02-a619-0cd554495783","block_type":"box","text":"aggregated for purposes of complying with the speculative limits. Thus, even if a Fund does not intend to exceed","page_number":45,"box":{"x":69,"y":861,"width":801,"height":11}},{"id":"3894cfd4-c846-4eae-b0d4-a039bf72f856","block_type":"box","text":"applicable position limits, it is possible that different clients managed by the Manager and its affiliates may be","page_number":45,"box":{"x":69,"y":876,"width":791,"height":11}},{"id":"cff8a803-4f72-4eff-84eb-f2dffd8f0769","block_type":"box","text":"aggregated for this purpose. Therefore, the trading decisions of the Manager may have to be modified and positions","page_number":45,"box":{"x":69,"y":891,"width":827,"height":12}},{"id":"4ed151fd-ad99-4c09-81dc-02077e57eefb","block_type":"box","text":"held by a Fund liquidated in order to avoid exceeding such limits. The modification of investment decisions or the","page_number":45,"box":{"x":69,"y":906,"width":805,"height":12}},{"id":"3e2c240c-6bb8-4891-9f43-c99e9fbcf622","block_type":"box","text":"II-14","page_number":45,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"450cec1c-3771-41f0-9ded-257fc5078100","block_type":"box","text":"NM0926U-5977317-45/232","page_number":45,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"dc217792-86c0-4f7d-9468-3afcdf74c34c","block_type":"box","text":"elimination of open positions, if it occurs, may adversely affect the profitability of a Fund. A violation of position limits","page_number":46,"box":{"x":69,"y":45,"width":837,"height":11}},{"id":"cc35cbd6-a225-4576-9024-e4db540715e8","block_type":"box","text":"could also lead to regulatory action materially adverse to a Fund’s investment strategy. A Fund may also be affected","page_number":46,"box":{"x":69,"y":60,"width":827,"height":11}},{"id":"6d19a7b3-86c4-453c-ab59-1485678e8903","block_type":"box","text":"by other regimes, including those of the European Union and United Kingdom, and trading venues that impose","page_number":46,"box":{"x":69,"y":75,"width":785,"height":11}},{"id":"451dd2cb-e808-4574-9b41-dd3e6d5b33be","block_type":"box","text":"position limits on commodity derivative contracts.","page_number":46,"box":{"x":70,"y":90,"width":350,"height":11}},{"id":"5fbf8e09-fa83-4643-a41b-b9adac1144e4","block_type":"box","text":"Additional Regulation of Derivatives.","page_number":46,"box":{"x":101,"y":113,"width":256,"height":11}},{"id":"b21e8fa4-fd16-4b57-8a80-55ac97c9310f","block_type":"box","text":"Regulatory bodies outside the U.S. have also passed, proposed, or may","page_number":46,"box":{"x":364,"y":113,"width":513,"height":11}},{"id":"1c9a18a0-fe4c-461d-94e8-771313fe58bd","block_type":"box","text":"propose in the future, legislation similar to Dodd-Frank or other legislation that could increase the costs of","page_number":46,"box":{"x":70,"y":128,"width":757,"height":11}},{"id":"ecc1f7c6-b7d4-482f-a9a6-9160f17e1127","block_type":"box","text":"participating in, or otherwise adversely impact the liquidity of, participating in the commodities markets. For example,","page_number":46,"box":{"x":70,"y":143,"width":836,"height":11}},{"id":"33ab511c-5924-4972-a0c4-8abd9e8b537a","block_type":"box","text":"the European Market Infrastructure Regulation (Regulation (EU) No 648/2012) (“EMIR”) introduced certain","page_number":46,"box":{"x":68,"y":158,"width":762,"height":11}},{"id":"cc1cadc2-8d4f-41b3-bb9e-3f8752dbd2d4","block_type":"box","text":"requirements in respect of OTC derivatives including: (i) the mandatory clearing of OTC derivative contracts declared","page_number":46,"box":{"x":69,"y":173,"width":825,"height":11}},{"id":"c22c8801-6dac-42dd-b8c0-ef58ac1c3416","block_type":"box","text":"subject to the clearing obligation; (ii) risk mitigation techniques in respect of uncleared OTC derivative contracts,","page_number":46,"box":{"x":69,"y":188,"width":798,"height":12}},{"id":"d5beed9a-e680-41d3-af91-e8e357d2245f","block_type":"box","text":"including the mandatory margining of uncleared OTC derivative contracts; and (iii) reporting and recordkeeping","page_number":46,"box":{"x":70,"y":203,"width":785,"height":12}},{"id":"f4105774-a6ea-467f-a0fe-6bdf5162c84a","block_type":"box","text":"requirements in respect of all derivatives contracts. By way of further example, the European Union Markets in","page_number":46,"box":{"x":69,"y":218,"width":787,"height":12}},{"id":"af1915b9-321b-4dff-b1ea-47b063e57612","block_type":"box","text":"Financial Instruments Directive (Directive 2014/65/EU) and Markets in Financial Instruments Regulation (Regulation","page_number":46,"box":{"x":70,"y":234,"width":830,"height":11}},{"id":"33134894-0de2-4825-ad8b-a628a168ac5e","block_type":"box","text":"(EU) No 600/2014) (together “MiFID II”), which have applied since January 3, 2018, govern the provision of","page_number":46,"box":{"x":69,"y":249,"width":771,"height":11}},{"id":"64c2e6b4-ee88-4258-a71c-898655f33e5b","block_type":"box","text":"investment services and activities in relation to, as well as the organized trading of, financial instruments such as","page_number":46,"box":{"x":70,"y":264,"width":812,"height":11}},{"id":"5fda40a8-7d49-443b-9f2c-0529c7730628","block_type":"box","text":"shares, bonds, units in collective investment schemes and derivatives. In particular, MiFID II requires European Union","page_number":46,"box":{"x":69,"y":279,"width":839,"height":11}},{"id":"f0dc842a-3c18-4bc9-9e49-f2e8c75d5d6a","block_type":"box","text":"Member States to apply position limits to the size of a net position a person can hold at any time in commodity","page_number":46,"box":{"x":70,"y":294,"width":793,"height":11}},{"id":"becdadb5-59ca-47a5-9135-917b17e91ab1","block_type":"box","text":"derivatives traded on European Union trading venues and in “economically equivalent” OTC contracts. If the","page_number":46,"box":{"x":69,"y":309,"width":765,"height":11}},{"id":"cd0ce46b-857c-45d3-9668-7b65fe9d7539","block_type":"box","text":"requirements of EMIR and MiFID II apply, the cost of derivatives transactions is expected to increase.","page_number":46,"box":{"x":69,"y":324,"width":720,"height":11}},{"id":"8ed2df9c-0fac-4e91-9970-93fbcc32a15e","block_type":"box","text":"In addition, regulations adopted by global prudential regulators that are now in effect require certain prudentially","page_number":46,"box":{"x":102,"y":347,"width":802,"height":11}},{"id":"99f261d3-d26d-47b4-98c4-a58ac2b66348","block_type":"box","text":"regulated entities and certain of their affiliates and subsidiaries (including swap dealers) to include in their","page_number":46,"box":{"x":69,"y":362,"width":762,"height":11}},{"id":"7c756a8b-ae22-4634-815a-7597e3492f5c","block_type":"box","text":"derivatives contracts and certain other financial contracts, terms that delay or restrict the rights of counterparties","page_number":46,"box":{"x":69,"y":377,"width":810,"height":12}},{"id":"131d4439-862a-4483-b231-2efc89f602d3","block_type":"box","text":"(such as the Funds) to terminate such contracts, foreclose upon collateral, exercise other default rights or restrict","page_number":46,"box":{"x":69,"y":392,"width":812,"height":12}},{"id":"ce05b3c8-119f-4281-8f8c-7756c92e5df5","block_type":"box","text":"transfers of credit support in the event that the prudentially regulated entity and/or its affiliates are subject to","page_number":46,"box":{"x":68,"y":407,"width":787,"height":12}},{"id":"52410f88-957d-4a41-a633-616376e484bd","block_type":"box","text":"certain types of resolution or insolvency proceedings. Similar regulations and laws have been adopted in non-U.S.","page_number":46,"box":{"x":69,"y":423,"width":810,"height":11}},{"id":"3ca9eeb5-6323-45b5-a455-c3bdf4f83360","block_type":"box","text":"jurisdictions that may apply to a Fund’s counterparties located in those jurisdictions. In particular, in the United","page_number":46,"box":{"x":67,"y":438,"width":795,"height":11}},{"id":"30553504-11eb-43a5-8568-79ce6f6a12bd","block_type":"box","text":"Kingdom and the European Union, governmental authorities could reduce, eliminate or convert to equity the liabilities","page_number":46,"box":{"x":70,"y":453,"width":835,"height":11}},{"id":"616eee2d-dddd-4ad3-b91b-93eaa4d3cf41","block_type":"box","text":"to a Fund of a counterparty experiencing financial difficulties (sometimes referred to as a “bail in”). It is possible that","page_number":46,"box":{"x":68,"y":468,"width":839,"height":11}},{"id":"d270bf3b-d1fd-4ef7-92aa-c3f8c0f24916","block_type":"box","text":"these requirements, as well as potential additional related government regulation, could adversely affect a Fund’s","page_number":46,"box":{"x":68,"y":483,"width":814,"height":11}},{"id":"1175b75e-5577-4556-8bac-a7ab1b8fd38c","block_type":"box","text":"ability to terminate existing derivatives contracts, exercise default rights or satisfy obligations owed to it with","page_number":46,"box":{"x":69,"y":498,"width":773,"height":11}},{"id":"563b796f-cabf-472b-bfb9-5bb291dd3fde","block_type":"box","text":"collateral received under such contracts.","page_number":46,"box":{"x":69,"y":514,"width":288,"height":8}},{"id":"a887589e-27cb-470a-8aaa-819ac03a1557","block_type":"box","text":"Risk Factors in Derivatives.","page_number":46,"box":{"x":102,"y":536,"width":191,"height":9}},{"id":"8a18e59a-2945-4e9e-9115-e13fc0012030","block_type":"box","text":"There are significant risks that apply generally to derivatives transactions, including:","page_number":46,"box":{"x":101,"y":559,"width":597,"height":11}},{"id":"7b3b3a71-feed-4c30-9ed2-73fee6648595","block_type":"box","text":"Correlation Risk","page_number":46,"box":{"x":102,"y":581,"width":114,"height":9}},{"id":"ba165ca8-d105-4701-a9b3-4286b7e59efa","block_type":"box","text":"— the risk that changes in the value of a derivative will not match the changes in the value of","page_number":46,"box":{"x":220,"y":581,"width":668,"height":12}},{"id":"8e74d891-0b14-4760-a4ad-5e7306e3d86c","block_type":"box","text":"the portfolio holdings that are being hedged or of the particular market or security to which the Fund seeks exposure.","page_number":46,"box":{"x":68,"y":596,"width":837,"height":12}},{"id":"87abc64c-e0ae-4975-8503-c6055e68f035","block_type":"box","text":"There are a number of factors which may prevent a derivative instrument from achieving the desired correlation (or","page_number":46,"box":{"x":68,"y":612,"width":818,"height":11}},{"id":"ce1b0b96-2b65-4be1-85d5-6666241fa582","block_type":"box","text":"inverse correlation) with an underlying asset, rate or index, such as the impact of fees, expenses and transaction","page_number":46,"box":{"x":70,"y":627,"width":806,"height":11}},{"id":"1bf1c095-7e11-428d-8b19-ae5e854e8dd2","block_type":"box","text":"costs, the timing of pricing, and disruptions or illiquidity in the markets for such derivative instrument.","page_number":46,"box":{"x":69,"y":642,"width":725,"height":11}},{"id":"d67d345c-3caf-4004-b58c-f41c37b810f6","block_type":"box","text":"Counterpar ty Risk","page_number":46,"box":{"x":102,"y":665,"width":128,"height":11}},{"id":"6ac09f67-691e-46aa-8cd6-e0a1605f4c02","block_type":"box","text":"— the risk that a derivatives transaction counterparty will be unable or unwilling to make","page_number":46,"box":{"x":233,"y":665,"width":632,"height":11}},{"id":"a0cef744-272f-4833-b848-a0102f54b170","block_type":"box","text":"payments or otherwise honor its obligations to a Fund and the related risks of having concentrated exposure to such","page_number":46,"box":{"x":70,"y":680,"width":830,"height":11}},{"id":"b4c83a11-c897-4f51-b1b7-d28a99f54210","block_type":"box","text":"a counterparty. In particular, derivatives traded in OTC markets often are not guaranteed by an exchange or clearing","page_number":46,"box":{"x":69,"y":695,"width":824,"height":11}},{"id":"73f7e86d-69aa-4b0d-9e7e-1880502f7a32","block_type":"box","text":"corporation and often do not require payment of margin, and to the extent that the Fund has unrealized gains in such","page_number":46,"box":{"x":69,"y":710,"width":834,"height":11}},{"id":"726902e0-846c-4718-be80-9106e9ebf8ce","block_type":"box","text":"instruments or has deposited collateral with its counterparties the Fund is at risk that its counterparties will become","page_number":46,"box":{"x":70,"y":725,"width":831,"height":11}},{"id":"8a8bf2c2-a92b-4ecf-8b88-e040ca5cd148","block_type":"box","text":"bankrupt or otherwise fail to honor their obligations. A Fund will typically attempt to minimize counterparty risk by","page_number":46,"box":{"x":69,"y":740,"width":806,"height":11}},{"id":"662cf419-c5b7-41e8-89a5-246855e6b978","block_type":"box","text":"engaging in OTC derivatives transactions only with creditworthy entities that have substantial capital or that have","page_number":46,"box":{"x":69,"y":755,"width":803,"height":11}},{"id":"8f619857-a2d4-49db-971c-4b2cd572e017","block_type":"box","text":"provided the Fund with a third-party guaranty or other credit support. When a Fund enters into a derivatives","page_number":46,"box":{"x":70,"y":771,"width":760,"height":11}},{"id":"a4864396-d637-4b58-8478-5c574eb6183f","block_type":"box","text":"transaction that is centrally cleared (whether mandatorily or voluntarily), the Fund is subject to the credit risk of the","page_number":46,"box":{"x":68,"y":785,"width":819,"height":12}},{"id":"818a8f23-bb7a-4abc-8302-42a4a080e16b","block_type":"box","text":"clearing house and the clearing member through which it holds its cleared position. Credit risk of market participants","page_number":46,"box":{"x":69,"y":801,"width":834,"height":11}},{"id":"c37c3e18-d08a-4fc9-a736-0360f7146c5d","block_type":"box","text":"with respect to derivatives that are centrally cleared is concentrated in a few clearing houses and increasingly fewer","page_number":46,"box":{"x":68,"y":816,"width":826,"height":11}},{"id":"c9598cb1-cd45-41e3-8764-06e0d1365d37","block_type":"box","text":"clearing members. It is not clear how an insolvency proceeding of a clearing house would be conducted and what","page_number":46,"box":{"x":69,"y":831,"width":805,"height":11}},{"id":"7cafb05b-cea7-43ba-921f-6407e6f99a35","block_type":"box","text":"impact an insolvency of a clearing house would have on the financial system. Also, a Fund will not be fully protected","page_number":46,"box":{"x":70,"y":846,"width":824,"height":11}},{"id":"67335dad-00e8-4291-81d9-596f0344f8f4","block_type":"box","text":"in the event of the bankruptcy of a Fund’s clearing member because the Fund would be limited to recovering only a","page_number":46,"box":{"x":70,"y":861,"width":816,"height":11}},{"id":"cdbff6d0-508b-445c-9fed-5a5ca84af036","block_type":"box","text":"pro rata share of the funds held by the clearing member on behalf of customers by account class for cleared","page_number":46,"box":{"x":70,"y":876,"width":771,"height":11}},{"id":"747ce596-9897-4d5f-a163-a58c504e1913","block_type":"box","text":"derivatives. Although a clearing member is required to segregate assets from customers with respect to cleared","page_number":46,"box":{"x":69,"y":891,"width":797,"height":12}},{"id":"b620f3f9-7705-4226-8e99-ff5ddc3550ce","block_type":"box","text":"derivatives positions from the clearing member’s proprietary assets, if a clearing member does not comply with the","page_number":46,"box":{"x":69,"y":906,"width":822,"height":12}},{"id":"307dbe8c-2b3c-413b-9fc8-5193ba92de5e","block_type":"box","text":"II-15","page_number":46,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"b6df8aeb-c86c-43a0-be7b-a3408aa7bde9","block_type":"box","text":"NM0926U-5977317-46/232","page_number":46,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"11b46771-6b8d-42cb-8317-1d989622d8b6","block_type":"box","text":"applicable regulations, or in the event of fraud or misappropriation of customer assets by a clearing member, a Fund","page_number":47,"box":{"x":69,"y":45,"width":829,"height":11}},{"id":"283f49f2-090b-4919-8b0d-cd4737c71c19","block_type":"box","text":"could have only an unsecured creditor claim in an insolvency of the clearing member with respect to the assets held","page_number":47,"box":{"x":69,"y":60,"width":827,"height":11}},{"id":"508444f1-21bf-4ed3-8fa1-94e275ee1112","block_type":"box","text":"by the clearing member.","page_number":47,"box":{"x":69,"y":75,"width":169,"height":11}},{"id":"583dd1b8-df2d-4dad-9f89-5baff611cbb3","block_type":"box","text":"Credit Risk","page_number":47,"box":{"x":102,"y":98,"width":78,"height":9}},{"id":"a94b8a1f-4c29-438b-863f-e6af835c4f9e","block_type":"box","text":"— the risk that the reference entity in a credit default swap or similar derivative will not be able to","page_number":47,"box":{"x":184,"y":98,"width":698,"height":11}},{"id":"42404241-9a62-4899-a4d6-a4e9fbed0938","block_type":"box","text":"honor its financial obligations.","page_number":47,"box":{"x":69,"y":113,"width":213,"height":11}},{"id":"5c61133c-1b60-42e9-adf5-21b7b4e05abf","block_type":"box","text":"Currency Risk","page_number":47,"box":{"x":102,"y":135,"width":98,"height":11}},{"id":"e6c82e51-3649-4b68-8254-2f472598a349","block_type":"box","text":"— the risk that changes in the exchange rate between two currencies will adversely affect the","page_number":47,"box":{"x":204,"y":135,"width":669,"height":12}},{"id":"b1aafabe-6022-4b63-a661-3080c9f5ea7e","block_type":"box","text":"value (in U.S. dollar terms) of a derivative.","page_number":47,"box":{"x":68,"y":150,"width":300,"height":11}},{"id":"8c8367d6-e372-4522-b10d-6f03e61c030e","block_type":"box","text":"Illiquidity Risk","page_number":47,"box":{"x":102,"y":173,"width":98,"height":11}},{"id":"b2d8433a-e7a5-40c6-9f62-fd0b5574dc5f","block_type":"box","text":"— the risk that certain securities or instruments may be difficult or impossible to sell at the time","page_number":47,"box":{"x":204,"y":173,"width":693,"height":11}},{"id":"d5a4c74a-c636-49e7-af7f-5f97888f5b39","block_type":"box","text":"or at the price desired by a Fund in connection with payments of margin, collateral, or settlement payments. There","page_number":47,"box":{"x":69,"y":188,"width":814,"height":12}},{"id":"043b76eb-4f76-4acf-a235-baf9e34b0a66","block_type":"box","text":"can be no assurance that a Fund will be able to unwind or offset a derivative at its desired price, in a secondary","page_number":47,"box":{"x":69,"y":203,"width":799,"height":12}},{"id":"5126c0bb-4d79-470f-bb2c-17d1190ed570","block_type":"box","text":"market or otherwise. It may, therefore, not be possible for the Fund to unwind its position in a derivative without","page_number":47,"box":{"x":69,"y":218,"width":799,"height":12}},{"id":"d549c60e-350a-4942-9466-2d9ec68725cb","block_type":"box","text":"incurring substantial losses (if at all). Certain OTC derivatives, including swaps and OTC options, involve substantial","page_number":47,"box":{"x":70,"y":234,"width":824,"height":11}},{"id":"592fea65-a10c-4f40-8cc1-1b3940acfe70","block_type":"box","text":"illiquidity risk. Illiquidity may also make it more difficult for a Fund to ascertain a market value for such derivatives. A","page_number":47,"box":{"x":70,"y":249,"width":830,"height":11}},{"id":"38e6afba-dc85-4e8f-ae51-41d4286e6dde","block_type":"box","text":"Fund will, therefore, acquire illiquid OTC derivatives (i) if the agreement pursuant to which the instrument is","page_number":47,"box":{"x":70,"y":264,"width":762,"height":11}},{"id":"b39037a8-54e3-48ba-bf56-39ebe17814b4","block_type":"box","text":"purchased contains a formula price at which the instrument may be terminated or sold, or (ii) for which the Manager","page_number":47,"box":{"x":70,"y":279,"width":827,"height":11}},{"id":"4b25ae34-f883-4cba-98c5-c9d89bc8a6f8","block_type":"box","text":"anticipates the Fund can receive on each business day at least two independent bids or offers, unless a quotation","page_number":47,"box":{"x":69,"y":294,"width":816,"height":11}},{"id":"1db7fbdc-056d-4ad8-b8c1-e7504e392f79","block_type":"box","text":"from only one dealer is available, in which case that dealer’s quotation may be used. The illiquidity of the derivatives","page_number":47,"box":{"x":68,"y":309,"width":831,"height":11}},{"id":"5e95e9c1-c0ac-4e07-a466-c946a0b43ca8","block_type":"box","text":"markets may be due to various factors, including congestion, disorderly markets, limitations on deliverable supplies,","page_number":47,"box":{"x":69,"y":324,"width":828,"height":12}},{"id":"a3c6d8fe-0d93-4818-9e35-79f803a2d67a","block_type":"box","text":"the participation of speculators, government regulation and intervention, and technical and operational or system","page_number":47,"box":{"x":68,"y":339,"width":809,"height":12}},{"id":"3f50dfdb-3b7a-4205-8312-aed76603fd93","block_type":"box","text":"failures. In addition, the liquidity of a market in an exchange-traded derivative contract may be adversely affected by","page_number":47,"box":{"x":68,"y":355,"width":826,"height":11}},{"id":"cfb38d6d-3d45-4cd8-a4db-89091aab953b","block_type":"box","text":"“daily price fluctuation limits” established by the exchanges which limit the amount of fluctuation in an exchange","page_number":47,"box":{"x":70,"y":370,"width":806,"height":11}},{"id":"82a243a2-2474-4715-b7a8-0aa43805ab3a","block_type":"box","text":"traded contract price during a single trading day. Once the daily limit has been reached in the contract, no trades may","page_number":47,"box":{"x":68,"y":385,"width":838,"height":11}},{"id":"1c38d978-5ae8-4184-8b21-ac309378dfb4","block_type":"box","text":"be entered into at a price beyond the limit, thus preventing the liquidation of open positions. Prices have in the past","page_number":47,"box":{"x":69,"y":400,"width":827,"height":11}},{"id":"db19ab15-7db9-4b5e-9d34-78dbd4cb9830","block_type":"box","text":"moved to the daily limit on a number of consecutive trading days with little to no trading. If it is not possible to close","page_number":47,"box":{"x":69,"y":415,"width":828,"height":11}},{"id":"3264e510-12e1-43c7-b24a-876b67ff4182","block_type":"box","text":"an open derivative position entered into by the Fund, the Fund would continue to be required to make daily cash","page_number":47,"box":{"x":69,"y":430,"width":796,"height":11}},{"id":"c30e7699-402c-4a4d-8496-014f6f8adda1","block_type":"box","text":"payments of variation margin in the event of adverse price movements. In such a situation, if the Fund has","page_number":47,"box":{"x":70,"y":445,"width":759,"height":12}},{"id":"3751c2e8-65a5-4fcc-ba69-c1b69c8d7053","block_type":"box","text":"insufficient cash, it may have to sell portfolio securities to meet daily variation margin requirements at a time when it","page_number":47,"box":{"x":70,"y":460,"width":837,"height":12}},{"id":"024c3a43-d58d-4b10-85f3-06eaf85e9735","block_type":"box","text":"may be disadvantageous to do so.","page_number":47,"box":{"x":69,"y":476,"width":243,"height":11}},{"id":"da26949c-3553-4b41-b9c9-d9cdda396a7d","block_type":"box","text":"Index Risk","page_number":47,"box":{"x":102,"y":498,"width":73,"height":9}},{"id":"d1d1bb42-86c4-4719-99a4-693e4bb8aad3","block_type":"box","text":"— if the derivative is linked to the performance of an index, it will be subject to the risks associated","page_number":47,"box":{"x":179,"y":498,"width":714,"height":11}},{"id":"a69767e4-a9c2-4426-ab4e-9e0a52a30ec5","block_type":"box","text":"with changes in that index. If the index changes, the Fund could receive lower interest payments or experience a","page_number":47,"box":{"x":68,"y":513,"width":800,"height":12}},{"id":"a8fc4a7e-ae91-4be5-8810-6d8890d71943","block_type":"box","text":"reduction in the value of the derivative to below the price that the Fund paid for such derivative.","page_number":47,"box":{"x":69,"y":528,"width":678,"height":11}},{"id":"09967d1d-d341-442c-b1e4-f76f658c7ebc","block_type":"box","text":"Legal Risk","page_number":47,"box":{"x":102,"y":551,"width":73,"height":11}},{"id":"52b8c242-141e-49b4-ac0e-52610ed716a0","block_type":"box","text":"— the risk of insufficient documentation, insufficient capacity or authority of counterparty, or legality","page_number":47,"box":{"x":179,"y":551,"width":717,"height":11}},{"id":"4069d1c6-168b-4b78-b543-babe29860f2d","block_type":"box","text":"or enforceability of a contract.","page_number":47,"box":{"x":69,"y":566,"width":211,"height":11}},{"id":"fcfb1594-f696-4640-b122-4f4d30b945b1","block_type":"box","text":"Leverage Risk","page_number":47,"box":{"x":102,"y":589,"width":99,"height":11}},{"id":"989b3bd2-17e8-4f77-87a7-3e6636659d5c","block_type":"box","text":"— the risk that a Fund’s derivatives transactions can magnify the Fund’s gains and losses.","page_number":47,"box":{"x":205,"y":589,"width":648,"height":11}},{"id":"72cb754e-9c90-4201-92cd-739d4a189a53","block_type":"box","text":"Relatively small market movements may result in large changes in the value of a derivatives position and can result","page_number":47,"box":{"x":70,"y":604,"width":823,"height":11}},{"id":"890bd58c-f182-40de-bc3b-cc0541ee94e9","block_type":"box","text":"in losses that greatly exceed the amount originally invested.","page_number":47,"box":{"x":70,"y":619,"width":425,"height":11}},{"id":"0c54a86e-bea1-4d00-8ef0-3c5c3b6cc0cc","block_type":"box","text":"Market Risk","page_number":47,"box":{"x":102,"y":642,"width":85,"height":9}},{"id":"c92206af-9b79-49cf-9ad9-46b5cd02cfbe","block_type":"box","text":"— the risk that changes in the value of one or more markets or changes with respect to the value of","page_number":47,"box":{"x":191,"y":642,"width":716,"height":11}},{"id":"00024a2c-fe04-473e-b3c6-b08ac38a2421","block_type":"box","text":"the underlying asset will adversely affect the value of a derivative. In the event of an adverse movement, a Fund may","page_number":47,"box":{"x":68,"y":657,"width":833,"height":11}},{"id":"789d4621-c484-465c-a03c-03a9949ad71c","block_type":"box","text":"be required to pay substantial additional margin to maintain its position or the Fund’s returns may be adversely","page_number":47,"box":{"x":69,"y":672,"width":794,"height":11}},{"id":"e819097b-e6f6-49ac-801a-ddfb969d96cc","block_type":"box","text":"affected.","page_number":47,"box":{"x":69,"y":687,"width":62,"height":9}},{"id":"419243fa-8c1c-4dd4-a6de-07baeaf928fc","block_type":"box","text":"Operational Risk","page_number":47,"box":{"x":102,"y":710,"width":117,"height":11}},{"id":"9226ea62-0c04-4f92-ba11-57c0a0f0c013","block_type":"box","text":"— the risk related to potential operational issues, including documentation issues, settlement","page_number":47,"box":{"x":223,"y":710,"width":674,"height":11}},{"id":"9e13113d-27a4-4dee-9a28-bd11a44e0693","block_type":"box","text":"issues, systems failures, inadequate controls and human error.","page_number":47,"box":{"x":70,"y":725,"width":451,"height":11}},{"id":"41b52359-31a8-4ba9-977a-9bb15e363578","block_type":"box","text":"Valuation Risk","page_number":47,"box":{"x":103,"y":748,"width":99,"height":9}},{"id":"e0b8cac7-c6c9-4623-826e-1fbe68e9179f","block_type":"box","text":"— the risk that valuation sources for a derivative will not be readily available in the market. This is","page_number":47,"box":{"x":206,"y":748,"width":701,"height":11}},{"id":"83861198-fa31-4d81-8a69-c30033a1e564","block_type":"box","text":"possible especially in times of market distress, since many market participants may be reluctant to purchase","page_number":47,"box":{"x":70,"y":763,"width":779,"height":11}},{"id":"5e01a44e-73b2-4476-8bb5-c42b88b64024","block_type":"box","text":"complex instruments or quote prices for them.","page_number":47,"box":{"x":69,"y":778,"width":329,"height":11}},{"id":"05a54ba1-0746-49f6-b0c2-65f40d6a2dab","block_type":"box","text":"Volatility Risk","page_number":47,"box":{"x":103,"y":801,"width":93,"height":11}},{"id":"7fef806f-277a-4520-99ea-72f1d04f330d","block_type":"box","text":"— the risk that the value of derivatives will fluctuate significantly within a short time period.","page_number":47,"box":{"x":200,"y":801,"width":652,"height":11}},{"id":"92c4c4f0-7342-4567-be2e-becf19d3ae19","block_type":"box","text":"Types of Derivatives Transactions.","page_number":47,"box":{"x":103,"y":823,"width":240,"height":11}},{"id":"94c6c872-0d5f-4805-9c68-85d21566f65d","block_type":"box","text":"A Fund may enter into derivatives transactions in accordance with its investment guidelines and restrictions,","page_number":47,"box":{"x":101,"y":846,"width":771,"height":11}},{"id":"04f0daa2-7b70-40dd-b5fd-2d4aefbd5c6d","block_type":"box","text":"including the following:","page_number":47,"box":{"x":70,"y":861,"width":159,"height":11}},{"id":"7fe42284-458f-48cf-9992-243c844e6819","block_type":"box","text":"Futures.","page_number":47,"box":{"x":102,"y":884,"width":56,"height":9}},{"id":"a87f34d2-9405-4991-b68c-ba04eb7e1551","block_type":"box","text":"II-16","page_number":47,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"80fec2a8-7950-4f6c-ab5c-e822fa99fdaf","block_type":"box","text":"NM0926U-5977317-47/232","page_number":47,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"a2baef1d-f84f-4631-8910-73ba5743eca7","block_type":"box","text":"A Fund may enter into futures contracts (“futures”) and options on futures contracts. Futures are standardized,","page_number":48,"box":{"x":101,"y":45,"width":791,"height":11}},{"id":"ed8e6ca7-8370-40fd-983a-9327100a6a3f","block_type":"box","text":"exchange-traded contracts that require a purchaser to take delivery, and a seller to make delivery, of a specified","page_number":48,"box":{"x":69,"y":60,"width":799,"height":11}},{"id":"1ddfdb82-645c-40f8-b61f-047746a4bdda","block_type":"box","text":"amount of an asset at a specified future date and price. Upon purchasing or selling a futures contract, a Fund is","page_number":48,"box":{"x":69,"y":75,"width":800,"height":11}},{"id":"2d0e8e3f-837f-4e81-96f3-e0fab72a6e7a","block_type":"box","text":"required to deposit initial margin equal to a percentage of the contract value. Futures contracts are marked to market","page_number":48,"box":{"x":69,"y":90,"width":838,"height":11}},{"id":"8ae7e4f2-cd2c-4cfe-9ae4-de657b59649f","block_type":"box","text":"daily for the duration of the contract, and the Fund will either post additional margin or be entitled to a payment, as","page_number":48,"box":{"x":69,"y":105,"width":820,"height":11}},{"id":"9224b402-0b3d-4933-808f-e5b4fbaecb29","block_type":"box","text":"applicable, based on the mark-to-market movement of the contract.","page_number":48,"box":{"x":69,"y":120,"width":478,"height":11}},{"id":"66cd5784-168a-4563-9f13-55457c03f826","block_type":"box","text":"A Fund may sell a futures contract prior to the completion of its term to limit its risk of loss from a decline in the","page_number":48,"box":{"x":101,"y":143,"width":801,"height":11}},{"id":"b73a668b-706e-475a-886a-01a6456ccbaa","block_type":"box","text":"market value of portfolio holdings correlated with the futures contract. However, in the event the market value of the","page_number":48,"box":{"x":69,"y":158,"width":829,"height":11}},{"id":"e164dd81-f9af-473d-b19e-e506a6048dfc","block_type":"box","text":"portfolio holdings correlated with the futures contract increases rather than decreases, a Fund will realize a loss on","page_number":48,"box":{"x":70,"y":173,"width":822,"height":11}},{"id":"f94c8ce0-5ccc-4e4a-bfb0-1fe97960b499","block_type":"box","text":"the futures position and a lower return on the portfolio holdings than would have been realized without the purchase","page_number":48,"box":{"x":68,"y":188,"width":830,"height":12}},{"id":"650d5148-113f-402d-b7e5-862f56f61fbc","block_type":"box","text":"of the futures contract.","page_number":48,"box":{"x":69,"y":203,"width":162,"height":9}},{"id":"7bdaeaa7-5e55-4983-94f0-d7086d50091b","block_type":"box","text":"The purchase of a futures contract may provide a Fund a lower cost alternative to purchasing securities or","page_number":48,"box":{"x":101,"y":226,"width":756,"height":11}},{"id":"26436c20-af29-4ee6-bbaa-2ffccce80b29","block_type":"box","text":"commodities directly. In the event that such securities or commodities decline in value or a Fund determines not to","page_number":48,"box":{"x":69,"y":241,"width":820,"height":11}},{"id":"9e869fd4-054d-4804-8c6e-65732fb98317","block_type":"box","text":"complete an anticipatory hedge transaction relating to a futures contract, however, the Fund may realize a loss","page_number":48,"box":{"x":69,"y":256,"width":789,"height":12}},{"id":"978949fb-4aed-4426-ad8a-47a8ea342719","block_type":"box","text":"relating to the futures position.","page_number":48,"box":{"x":69,"y":271,"width":219,"height":12}},{"id":"0ebcc282-35f2-48e2-a76f-b6ca98bc0bdc","block_type":"box","text":"Futures contracts are also subject to position limits. In order to comply with position limits, a Fund may be","page_number":48,"box":{"x":102,"y":294,"width":757,"height":11}},{"id":"a1c20c23-c48a-493b-b0e8-c80f54730008","block_type":"box","text":"required to liquidate positions or may not be able to fully implement trading instructions. Any such liquidation or","page_number":48,"box":{"x":69,"y":309,"width":797,"height":11}},{"id":"cb8f3406-bb2e-43bd-87c4-da1e7dc42017","block_type":"box","text":"limited implementation could result in substantial costs to a Fund. See “—Regulation of Derivatives — Dodd-Frank","page_number":48,"box":{"x":70,"y":324,"width":816,"height":12}},{"id":"d2d7c375-2db8-427f-8240-c028bb1d4ec6","block_type":"box","text":"Regulations” above.","page_number":48,"box":{"x":70,"y":340,"width":140,"height":11}},{"id":"e93d5fd8-c29a-43d4-8f36-9eb65799cec3","block_type":"box","text":"A Fund is also permitted to purchase or sell call and put options on futures contracts, including financial futures","page_number":48,"box":{"x":101,"y":362,"width":799,"height":11}},{"id":"0e986e39-a3e1-486f-840d-df3360fe5932","block_type":"box","text":"and stock indices. Generally, these strategies would be used under the same market and market sector conditions","page_number":48,"box":{"x":69,"y":377,"width":818,"height":12}},{"id":"1f574c65-091d-4642-839a-a321235728d7","block_type":"box","text":"(","page_number":48,"box":{"x":69,"y":393,"width":3,"height":10}},{"id":"ff8e3bd0-85e8-4b6f-b06e-f7b578372898","block_type":"box","text":"i.e.","page_number":48,"box":{"x":74,"y":393,"width":21,"height":8}},{"id":"d94276a4-e8e9-40ae-945a-d9e83ab9ec7b","block_type":"box","text":", conditions relating to specific types of investments) in which the Fund entered into futures transactions. A Fund","page_number":48,"box":{"x":97,"y":392,"width":803,"height":12}},{"id":"8bff50e0-608e-46bf-bff2-61aeed5644ba","block_type":"box","text":"may purchase put options or write call options on futures contracts and stock indices in lieu of selling the underlying","page_number":48,"box":{"x":69,"y":407,"width":830,"height":12}},{"id":"19ca5f55-3246-438e-ae68-916967d66ee1","block_type":"box","text":"futures contract in anticipation of a decrease in the market value of its securities. Similarly, a Fund can purchase call","page_number":48,"box":{"x":68,"y":423,"width":835,"height":11}},{"id":"1c070d69-b54e-49fa-a6d0-cd2da52bc521","block_type":"box","text":"options, or write put options on futures contracts and stock indices, as a substitute for the purchase of such futures","page_number":48,"box":{"x":69,"y":438,"width":831,"height":11}},{"id":"787aaf43-8635-46b6-bbaf-6942f11d12c7","block_type":"box","text":"contracts to hedge against the increased cost resulting from an increase in the market value of securities which the","page_number":48,"box":{"x":69,"y":453,"width":826,"height":11}},{"id":"12b944a9-db12-4643-9174-bdd502d2cf10","block_type":"box","text":"Fund intends to purchase.","page_number":48,"box":{"x":70,"y":468,"width":183,"height":11}},{"id":"e32ac3a1-4002-4e32-aca8-abab9cfb99bb","block_type":"box","text":"To maintain greater flexibility, a Fund may invest in instruments which have characteristics similar to futures","page_number":48,"box":{"x":101,"y":491,"width":768,"height":11}},{"id":"a9c80761-27d4-40e2-9153-8ccddae1118c","block_type":"box","text":"contracts. These instruments may take a variety of forms, such as debt securities with interest or principal payments","page_number":48,"box":{"x":69,"y":506,"width":835,"height":11}},{"id":"bbc9642a-c03e-42e0-9b7f-5cca083769fa","block_type":"box","text":"determined by reference to the value of a security, an index of securities or a commodity at a future point in time. The","page_number":48,"box":{"x":69,"y":521,"width":839,"height":11}},{"id":"73d5133b-f427-40a4-9249-ba2f810e3c1a","block_type":"box","text":"risks of such investments could reflect the risks of investing in futures and securities, including volatility and","page_number":48,"box":{"x":69,"y":536,"width":773,"height":11}},{"id":"3ec3c8e3-b650-4269-9733-efb19f1318f0","block_type":"box","text":"illiquidity.","page_number":48,"box":{"x":70,"y":551,"width":63,"height":11}},{"id":"0ff28c32-3475-4f49-b97c-c185520192f8","block_type":"box","text":"Futures contracts and options on futures contracts are subject to significant correlation risk, leverage risk,","page_number":48,"box":{"x":102,"y":574,"width":757,"height":11}},{"id":"d99f4549-4391-494f-b250-9453964b7828","block_type":"box","text":"illiquidity risk, market risk and counterparty risk with respect to a Fund’s futures broker or the clearinghouse. See","page_number":48,"box":{"x":70,"y":589,"width":807,"height":11}},{"id":"46470fa9-ab56-415a-ba03-dd9e292b40dd","block_type":"box","text":"“—Risk Factors in Derivatives” above.","page_number":48,"box":{"x":70,"y":604,"width":269,"height":9}},{"id":"e1c3be66-ca73-4b0c-82a8-c48b0625f63f","block_type":"box","text":"Certain Funds may invest in futures based on carbon “allowances.” Under certain regulatory regimes, a limit is","page_number":48,"box":{"x":102,"y":627,"width":791,"height":11}},{"id":"e3cffba5-625f-4d32-92b1-9a29a4e17db3","block_type":"box","text":"set by a regulator, such as a government entity, on the total amount of specific greenhouse gases, such as CO2, that","page_number":48,"box":{"x":69,"y":642,"width":838,"height":11}},{"id":"bc61ae68-438e-4e91-9556-7fc78df6435a","block_type":"box","text":"can be emitted by regulated entities, such as manufacturers or energy producers. The regulator then may issue or","page_number":48,"box":{"x":69,"y":657,"width":814,"height":11}},{"id":"c2d380d5-0dc3-42c5-b08e-b9f6a5e4cc84","block_type":"box","text":"sell individual “emission allowances” to regulated entities, which can then be traded on the open market. Commodity","page_number":48,"box":{"x":69,"y":672,"width":837,"height":11}},{"id":"5874e0be-ccbf-44e2-a589-c34c43ba2243","block_type":"box","text":"futures contracts linked to the value of emission allowances are known as “carbon futures.”","page_number":48,"box":{"x":68,"y":687,"width":657,"height":9}},{"id":"e7fdad40-4e98-45fc-b7cd-df642a20ca29","block_type":"box","text":"The price for carbon futures contracts is based on a number of factors, including the supply of and the demand","page_number":48,"box":{"x":101,"y":710,"width":792,"height":11}},{"id":"4d2bdc43-0617-46ee-9dd8-5dddb61d899d","block_type":"box","text":"for carbon futures contracts. Changes in law, market conditions and expectations, position limits, collateral","page_number":48,"box":{"x":68,"y":725,"width":764,"height":11}},{"id":"48885b36-83cc-413e-9b6e-8ee59cd66779","block_type":"box","text":"requirements, and other factors each can impact the supply of and demand for carbon futures contracts. The market","page_number":48,"box":{"x":69,"y":740,"width":832,"height":11}},{"id":"27eb80e8-e0da-4193-b088-2d24238cf68f","block_type":"box","text":"for carbon futures contracts is still developing and may be subject to periods of illiquidity. During such times it may be","page_number":48,"box":{"x":68,"y":755,"width":841,"height":11}},{"id":"20155b0d-2a9e-4b21-972e-f749f690a8c0","block_type":"box","text":"difficult or impossible to buy or sell a position at the desired price. Market disruptions or volatility can also make it","page_number":48,"box":{"x":69,"y":770,"width":819,"height":11}},{"id":"b08fd6ae-bbec-4195-aadc-6705c5b7832a","block_type":"box","text":"difficult to find a counterparty willing to transact at a reasonable price and sufficient size.","page_number":48,"box":{"x":69,"y":785,"width":637,"height":12}},{"id":"028e14ab-4dc4-4a1f-8b5b-b7faf90ef0a6","block_type":"box","text":"Swap Agreements.","page_number":48,"box":{"x":102,"y":808,"width":131,"height":11}},{"id":"d07b38a1-af9a-4056-9ca9-dae889652e69","block_type":"box","text":"A Fund may enter into swap agreements for hedging purposes or speculative purposes. Swap agreements are","page_number":48,"box":{"x":101,"y":831,"width":782,"height":11}},{"id":"79538f53-60e9-41cd-bbc5-e48da2eb94ec","block_type":"box","text":"OTC contracts entered into primarily by financial institutions and institutional investors which may or may not be","page_number":48,"box":{"x":69,"y":846,"width":796,"height":11}},{"id":"38454ef4-2d1a-4a6b-8140-a9c31c7e06f2","block_type":"box","text":"cleared by a central clearinghouse. In a standard “swap” transaction, two parties agree to exchange the returns","page_number":48,"box":{"x":69,"y":861,"width":799,"height":11}},{"id":"4f98d1a7-def0-412c-a649-8c8c3ce6b9d3","block_type":"box","text":"earned or realized from one or more underlying assets or rates of return, which may be adjusted for an interest","page_number":48,"box":{"x":69,"y":876,"width":792,"height":11}},{"id":"12e8d849-9ffe-4b7b-b9b4-e6e6a02b4849","block_type":"box","text":"factor. The gross returns to be exchanged or “swapped” between the parties are generally calculated with respect to","page_number":48,"box":{"x":68,"y":891,"width":832,"height":12}},{"id":"14f80898-472d-4111-ab8f-aa0d319aa0fc","block_type":"box","text":"a “notional amount,”","page_number":48,"box":{"x":69,"y":907,"width":147,"height":10}},{"id":"3a0b126f-7990-49a9-9a7d-27a0f6a3bb41","block_type":"box","text":"e.g.","page_number":48,"box":{"x":223,"y":908,"width":25,"height":10}},{"id":"0cf9574c-8fc2-4d33-9211-c1beaaa32ce9","block_type":"box","text":", the return or increase in value of a particular dollar amount invested at a particular","page_number":48,"box":{"x":251,"y":906,"width":602,"height":11}},{"id":"f8ad12fe-bc6c-462e-836c-4d254a7e328c","block_type":"box","text":"II-17","page_number":48,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"00b35900-9e91-4d37-b71a-4bebcd3338a4","block_type":"box","text":"NM0926U-5977317-48/232","page_number":48,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"5b67f8bb-2175-466d-9982-25f17da1fe3f","block_type":"box","text":"interest rate, in a particular foreign currency, or in a “basket” of securities representing a particular index. The","page_number":49,"box":{"x":70,"y":45,"width":787,"height":11}},{"id":"439fb2dc-9da6-44e8-8b91-d89fdd45ba99","block_type":"box","text":"notional amount of the swap agreement is only used to calculate the obligations that the parties to a swap","page_number":49,"box":{"x":69,"y":60,"width":762,"height":11}},{"id":"ebb6b76e-097b-4cfe-8aeb-d858c1b7dec8","block_type":"box","text":"agreement have agreed to exchange. A Fund’s obligations (or rights) under a swap agreement will generally be equal","page_number":49,"box":{"x":69,"y":75,"width":828,"height":11}},{"id":"73e36346-85dc-4044-b0b1-5c7f473b1570","block_type":"box","text":"only to the net amount to be paid or received under the agreement based on the relative values of the positions held","page_number":49,"box":{"x":69,"y":90,"width":832,"height":11}},{"id":"23a802ba-be92-4a8b-afc7-e386f88c71ff","block_type":"box","text":"by each party to the agreement. Swaps that are not cleared involve substantial counterparty risk. A Fund will typically","page_number":49,"box":{"x":69,"y":105,"width":835,"height":11}},{"id":"bfb562d6-a700-47ec-b3f4-5f4ac79d5d5e","block_type":"box","text":"attempt to mitigate this counterparty risk by entering into swap agreements only with creditworthy entities that have","page_number":49,"box":{"x":69,"y":120,"width":826,"height":12}},{"id":"88276cc4-2e7a-43a2-b2a0-c6b79d02a084","block_type":"box","text":"substantial capital or that have provided the Fund with a third-party guaranty or other credit support. A Fund’s ability","page_number":49,"box":{"x":69,"y":136,"width":827,"height":11}},{"id":"e06e2803-d77b-4c27-9f25-2f6526926bba","block_type":"box","text":"to use swap agreements may be restricted by the tax rules applicable to registered investment companies.","page_number":49,"box":{"x":68,"y":151,"width":763,"height":11}},{"id":"cd8f2e39-454f-4fdd-9f3f-6151a9e058f9","block_type":"box","text":"Credit Default Swaps and Similar Instruments.","page_number":49,"box":{"x":102,"y":173,"width":329,"height":11}},{"id":"a53e7e0a-4e4b-4cde-b8bd-d6b8e19b3c1b","block_type":"box","text":"Certain Funds may enter into credit default swaps and similar","page_number":49,"box":{"x":438,"y":173,"width":439,"height":11}},{"id":"6294696c-1548-4ea9-bf23-ad11c87424f6","block_type":"box","text":"instruments. Credit default swaps are standardized agreements in which the protection “buyer” pays the protection","page_number":49,"box":{"x":70,"y":188,"width":821,"height":12}},{"id":"2bc71dc8-c552-4902-a652-e3a2dd2491f2","block_type":"box","text":"“seller” an up-front payment, or a periodic stream of payments, over the term of the contract, provided generally that","page_number":49,"box":{"x":70,"y":203,"width":831,"height":12}},{"id":"ab0b79e2-e6c4-440c-994d-19a198e5f265","block_type":"box","text":"no credit event on a reference obligation has occurred. If a credit event occurs, the seller generally must pay the","page_number":49,"box":{"x":69,"y":218,"width":801,"height":12}},{"id":"8187993d-345d-4504-b844-5092bc73e14a","block_type":"box","text":"buyer the difference between the notional amount of the contract and the value of a portfolio of securities issued by","page_number":49,"box":{"x":69,"y":234,"width":829,"height":11}},{"id":"a8a57e48-ec92-4f2f-a15c-b4d052836c66","block_type":"box","text":"the reference entity. A Fund may be either the buyer or seller in the transaction. The Funds may enter into credit","page_number":49,"box":{"x":68,"y":249,"width":798,"height":11}},{"id":"a22533b7-3043-4c6c-a4d7-4a7661f27d46","block_type":"box","text":"default swaps that reference the obligations of a single entity (“single-name CDS”) or the obligations of entities that","page_number":49,"box":{"x":69,"y":264,"width":827,"height":11}},{"id":"d4bc252a-d332-4eb6-9028-b5f3c431e73b","block_type":"box","text":"make up an index (“index CDS”). References to “credit default swaps” shall collectively refer to single-name CDS and","page_number":49,"box":{"x":69,"y":279,"width":836,"height":11}},{"id":"83f5c2a6-660e-4575-8165-1a333d982018","block_type":"box","text":"index CDS.","page_number":49,"box":{"x":70,"y":294,"width":75,"height":9}},{"id":"594fd040-fd38-4692-9cef-67af9d1754f8","block_type":"box","text":"Credit default swaps have as reference obligations one or more securities or loans that are not currently held by","page_number":49,"box":{"x":102,"y":317,"width":800,"height":11}},{"id":"db4cd09c-0d01-4d0f-b7bd-7d0798fe0b14","block_type":"box","text":"a Fund. In circumstances in which a Fund does not own the securities or loans that are deliverable under a credit","page_number":49,"box":{"x":69,"y":332,"width":806,"height":9}},{"id":"91060301-6f39-42ca-bf06-d8933fd707aa","block_type":"box","text":"default swap, the Fund is exposed to the risk that deliverable securities will not be available in the market, or will be","page_number":49,"box":{"x":69,"y":347,"width":828,"height":11}},{"id":"3e1e38bb-c2d6-471b-90f2-d39bbb704972","block_type":"box","text":"available only at unfavorable prices, as would be the case in a so-called “short squeeze.” In certain instances of","page_number":49,"box":{"x":69,"y":362,"width":804,"height":11}},{"id":"d574985e-cf8b-4ae4-93a5-af53b16b0efd","block_type":"box","text":"issuer defaults or restructurings, it has been unclear under the standard industry documentation for credit default","page_number":49,"box":{"x":70,"y":377,"width":812,"height":12}},{"id":"d6415a5a-bb77-40fc-91ef-81cd7ec3a8e9","block_type":"box","text":"swaps whether or not a “credit event” triggering the seller’s payment obligation had occurred. Certain initiatives","page_number":49,"box":{"x":69,"y":392,"width":798,"height":12}},{"id":"c70b1227-2876-426a-8a29-346d5d6058cf","block_type":"box","text":"adopted by derivatives market participants, including the International Swaps and Derivatives Association (“ISDA”),","page_number":49,"box":{"x":69,"y":408,"width":819,"height":11}},{"id":"3543d080-aa8f-4223-ac47-296cb2079470","block_type":"box","text":"are designed to implement uniform settlement terms into standard credit default swap documentation, as well as","page_number":49,"box":{"x":69,"y":423,"width":810,"height":11}},{"id":"a648ebbf-a81c-46de-b1ae-eba858b3bc23","block_type":"box","text":"refine the practices for the transparent conduct of the credit default swap market generally. Among these initiatives","page_number":49,"box":{"x":69,"y":438,"width":821,"height":11}},{"id":"668dcae7-bb10-45c5-adca-febbd4d0f652","block_type":"box","text":"are the ISDA Credit Derivatives Determination Committee and the implementation of market-wide cash settlement","page_number":49,"box":{"x":69,"y":453,"width":811,"height":11}},{"id":"33fafd2e-d31e-4fa8-b7b3-cd2679bf4f49","block_type":"box","text":"protocols applicable to all market-standard credit default swaps. These initiatives are intended to reduce both the","page_number":49,"box":{"x":70,"y":468,"width":809,"height":11}},{"id":"2501574e-3257-440c-8017-f1999f3ea5a8","block_type":"box","text":"uncertainty as to the occurrence of credit events and the risk of a “short squeeze” by providing that the ISDA Credit","page_number":49,"box":{"x":69,"y":483,"width":827,"height":11}},{"id":"01eb2504-92d0-4c1f-b17b-289789ac1b66","block_type":"box","text":"Derivatives Determinations Committee will make determinations as to whether a credit event has occurred, establish","page_number":49,"box":{"x":70,"y":498,"width":834,"height":11}},{"id":"9a69af1b-43d5-46d9-ae26-67d689ea7d42","block_type":"box","text":"an auction to determine a settlement price and identify the deliverable securities for purposes of the auction,","page_number":49,"box":{"x":69,"y":513,"width":778,"height":11}},{"id":"8329594e-e90c-40cc-b188-40aaf782b999","block_type":"box","text":"although the ISDA Credit Derivatives Determinations Committee may in certain limited circumstances refrain from","page_number":49,"box":{"x":69,"y":528,"width":809,"height":12}},{"id":"4dcec927-ea8d-40d9-a443-dc80409ced47","block_type":"box","text":"doing so. In the event the ISDA Credit Derivatives Determinations Committee cannot reach a timely resolution with","page_number":49,"box":{"x":69,"y":544,"width":815,"height":11}},{"id":"9be07616-d03b-4b63-9775-c92ce08ee44f","block_type":"box","text":"respect to a “credit event” or otherwise does not establish a cash settlement auction, a Fund may not be able to","page_number":49,"box":{"x":69,"y":559,"width":807,"height":11}},{"id":"894f056d-44f6-4153-b062-7fdb6a2cbcf4","block_type":"box","text":"realize the full value of the credit default swap upon a default by the reference entity. Furthermore, a Fund may enter","page_number":49,"box":{"x":69,"y":574,"width":832,"height":11}},{"id":"f3817376-f216-41d5-b30a-44a5a4e53eff","block_type":"box","text":"into certain credit default swaps or similar instruments that may not be covered by these initiatives.","page_number":49,"box":{"x":70,"y":589,"width":711,"height":11}},{"id":"a29e9f3f-bca2-438e-8598-446e11c1cc57","block_type":"box","text":"If a Fund is a buyer, it will lose the payments made under the terms of the credit default swap and recover","page_number":49,"box":{"x":102,"y":612,"width":757,"height":11}},{"id":"ae1e0d1e-ef72-4007-b76b-1440d15ed177","block_type":"box","text":"nothing should no credit event occur. If a Fund is a seller and a credit event occurs, the value of any deliverable","page_number":49,"box":{"x":69,"y":627,"width":794,"height":11}},{"id":"fb86c9f9-e41d-434c-80f2-19d12a7dd67f","block_type":"box","text":"obligation received by the Fund or the amount of cash settlement received by the Fund pursuant to the relevant cash","page_number":49,"box":{"x":69,"y":642,"width":830,"height":11}},{"id":"4172fc7f-dd25-4bc4-9eba-0368b6bae29d","block_type":"box","text":"settlement auction, together with the up-front or periodic payments previously received, may be less than the amount","page_number":49,"box":{"x":69,"y":657,"width":835,"height":11}},{"id":"93768c6d-3e4b-4688-9193-bb826d9361f3","block_type":"box","text":"it pays to the buyer, resulting in a loss of value to the Fund. A Fund that sells credit default swaps incurs leveraged","page_number":49,"box":{"x":70,"y":672,"width":817,"height":11}},{"id":"538215ae-dca2-48f8-b791-e80a6869c1ed","block_type":"box","text":"exposure to the credit of one or more reference entities and is subject to many of the same risks it would incur if it","page_number":49,"box":{"x":69,"y":687,"width":820,"height":11}},{"id":"faf07c97-17e8-4f8f-b6a4-eea041cbfa89","block_type":"box","text":"were holding debt securities issued by the relevant reference entity. However, a Fund will not have any legal recourse","page_number":49,"box":{"x":68,"y":702,"width":833,"height":12}},{"id":"7f9706d0-a6cc-46f1-aff1-568641c93906","block_type":"box","text":"against any reference entity and will not benefit from any collateral securing the reference entity’s debt obligations. In","page_number":49,"box":{"x":69,"y":717,"width":837,"height":12}},{"id":"60fb3348-c0f8-4bdf-b368-fd37c4860cf9","block_type":"box","text":"the event the ISDA Credit Derivatives Determinations Committee does not establish a cash settlement auction and","page_number":49,"box":{"x":68,"y":733,"width":820,"height":9}},{"id":"c764cee3-3344-478a-887d-c621a45aa1dd","block_type":"box","text":"identify the relevant deliverable securities or loans, the credit default swap buyer will have broad discretion to select","page_number":49,"box":{"x":70,"y":748,"width":828,"height":11}},{"id":"e3b7c1ca-ffc7-448f-bc5a-1bdb5215e87b","block_type":"box","text":"which of the reference entity’s debt obligations to deliver to the Fund following a credit event and will likely choose","page_number":49,"box":{"x":68,"y":763,"width":815,"height":11}},{"id":"90ab8381-1205-486c-b5e1-6be3937b4e25","block_type":"box","text":"the obligations with the lowest market value in order to maximize the payment obligations of the Fund. In addition,","page_number":49,"box":{"x":68,"y":778,"width":814,"height":11}},{"id":"2b3d5ed0-d6e5-41ac-bc61-5787d1308bc5","block_type":"box","text":"credit default swaps generally trade on the basis of theoretical pricing and valuation models, which may not","page_number":49,"box":{"x":69,"y":793,"width":766,"height":11}},{"id":"2a020faf-f4ef-472d-acb2-3029e565b9da","block_type":"box","text":"accurately value such swap positions when established or when subsequently traded or unwound under actual market","page_number":49,"box":{"x":69,"y":808,"width":840,"height":11}},{"id":"02ff3b0f-9049-4cd2-97cd-171a4a99f7d2","block_type":"box","text":"conditions.","page_number":49,"box":{"x":69,"y":823,"width":76,"height":9}},{"id":"2cf5a50e-a736-4668-8156-f881eceba445","block_type":"box","text":"Dodd-Frank requires that certain index CDS be executed in regulated markets and submitted for clearing to","page_number":49,"box":{"x":102,"y":846,"width":762,"height":11}},{"id":"5cd4cb85-4818-4921-b739-3488f022ea35","block_type":"box","text":"regulated clearinghouses. See “—Derivatives — Regulation of Derivatives — Dodd-Frank Regulations” above. Other","page_number":49,"box":{"x":69,"y":861,"width":824,"height":11}},{"id":"b7810b94-12f0-4bac-aabf-cee765c345a2","block_type":"box","text":"single-name CDS and index CDS are permitted, although not required, to be cleared through regulated","page_number":49,"box":{"x":69,"y":876,"width":727,"height":11}},{"id":"aad6a65b-62ee-4c2b-91e3-c3915f83d443","block_type":"box","text":"clearinghouses. The Funds clear all credit default swaps that are subject to mandatory clearing and may voluntarily","page_number":49,"box":{"x":69,"y":891,"width":819,"height":12}},{"id":"57ba69b5-dbf2-4fb3-aacb-2c7a13bbde96","block_type":"box","text":"clear some, but not all, of the other credit default swaps not subject to mandatory clearing. The Funds face","page_number":49,"box":{"x":69,"y":906,"width":764,"height":12}},{"id":"57ddfa73-dbf5-463c-b914-2d34b2c5b4b8","block_type":"box","text":"II-18","page_number":49,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"2719245a-2f2a-4b7b-8fc5-5b42be3cae8b","block_type":"box","text":"NM0926U-5977317-49/232","page_number":49,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"501ff67d-12dd-48fd-932f-d61dd9c5d648","block_type":"box","text":"counterparty risk with respect to the clearinghouse when entering into cleared single-name CDS and cleared index","page_number":50,"box":{"x":69,"y":45,"width":813,"height":11}},{"id":"74b539b8-3b44-4c90-bfa1-d2edb610d199","block_type":"box","text":"CDS. The Funds face significant counterparty risk with respect to their counterparties to non-cleared credit default","page_number":50,"box":{"x":69,"y":60,"width":813,"height":11}},{"id":"2ab264a4-816e-47da-aa5a-0c298a8d4d41","block_type":"box","text":"swaps and similar instruments. A Fund typically will enter into non-cleared credit default swaps and similar","page_number":50,"box":{"x":69,"y":75,"width":759,"height":11}},{"id":"5e37ceae-3dc2-4516-a5c1-2b042b9d283d","block_type":"box","text":"instruments with swap dealers and creditworthy entities that have substantial capital or that have provided the Fund","page_number":50,"box":{"x":70,"y":90,"width":828,"height":11}},{"id":"867c0546-ce59-4e8b-ae95-260be90d2eed","block_type":"box","text":"with a third-party guaranty or other credit support.","page_number":50,"box":{"x":68,"y":105,"width":355,"height":11}},{"id":"fef1f0ed-1aba-42a5-a71c-d4c3bcc413eb","block_type":"box","text":"In certain instances, a Fund may enter into bespoke credit default swaps or similar instruments either as","page_number":50,"box":{"x":102,"y":128,"width":750,"height":11}},{"id":"dec9908f-c1de-43fa-ae4e-46afc3c964e9","block_type":"box","text":"protection buyer or protection seller. While these contracts are similar in their operation to the market-standard credit","page_number":50,"box":{"x":70,"y":143,"width":836,"height":11}},{"id":"242d4444-3034-49bb-8e6d-897426f75d22","block_type":"box","text":"default swaps described above, they are less standardized and instead have bespoke or tailored features. For","page_number":50,"box":{"x":69,"y":158,"width":785,"height":11}},{"id":"9f537151-499f-4d7f-8104-fd6bfa9207a4","block_type":"box","text":"example, as compared to market-standard credit defaults, the range of “credit events” triggering settlement of such","page_number":50,"box":{"x":69,"y":173,"width":825,"height":11}},{"id":"7b02f252-50ed-4781-92cf-1bd443b7d219","block_type":"box","text":"bespoke contracts may be narrower or broader, any such triggered contracts are settled by physical delivery of the","page_number":50,"box":{"x":69,"y":188,"width":814,"height":12}},{"id":"3e6ea899-5eec-4267-8839-d7be98d21cff","block_type":"box","text":"underlying security or loan to or by the Fund rather than by way of cash settlement, and there may be a wider range of","page_number":50,"box":{"x":69,"y":203,"width":839,"height":12}},{"id":"76967c1f-0982-4f99-885a-d77b5afaff4a","block_type":"box","text":"securities as the reference obligations and/or deliverable obligations.","page_number":50,"box":{"x":69,"y":218,"width":495,"height":12}},{"id":"02167359-4371-4ef6-b700-7bfb6895eb9a","block_type":"box","text":"In addition, credit default swaps and similar instruments generally involve greater risks than if a Fund had","page_number":50,"box":{"x":102,"y":241,"width":752,"height":11}},{"id":"9a636da4-aef2-43c7-af0c-cbfcf178f51a","block_type":"box","text":"invested in the reference obligation directly and are subject to significant credit risk, correlation risk, leverage risk,","page_number":50,"box":{"x":70,"y":256,"width":814,"height":12}},{"id":"00905d76-539a-4231-80d6-3855484b0d0c","block_type":"box","text":"illiquidity risk and market risk. See “—Risk Factors in Derivatives” above.","page_number":50,"box":{"x":70,"y":272,"width":520,"height":11}},{"id":"dac4296b-118c-47b3-ad1e-4b8f0b2adfa3","block_type":"box","text":"Interest Rate Swaps, Floors and Caps.","page_number":50,"box":{"x":102,"y":294,"width":273,"height":11}},{"id":"6e5c9c98-d160-4e92-8965-50a33c21df7f","block_type":"box","text":"Certain Funds may enter into OTC derivatives in the form of interest rate","page_number":50,"box":{"x":381,"y":294,"width":515,"height":11}},{"id":"98c8b7f6-a095-4c33-bb79-6cfd0f2eb577","block_type":"box","text":"swaps and interest rate caps and floors. As described in further detail below, a Fund may enter into these","page_number":50,"box":{"x":69,"y":309,"width":755,"height":11}},{"id":"40476572-f06f-4f87-96ca-5a9523914814","block_type":"box","text":"transactions primarily to preserve a return or spread on a particular investment or portion of its holdings, as a","page_number":50,"box":{"x":68,"y":324,"width":788,"height":12}},{"id":"feb16015-a7eb-4b96-a51a-f285a03ebeb7","block_type":"box","text":"duration management technique, to protect against an increase in the price of securities a Fund anticipates","page_number":50,"box":{"x":69,"y":339,"width":768,"height":12}},{"id":"cc6eee83-63d2-4f84-bf45-68d48fa205b5","block_type":"box","text":"purchasing at a later date, or for speculation to increase returns.","page_number":50,"box":{"x":70,"y":355,"width":461,"height":11}},{"id":"7d6886d7-95d6-45b7-aa7d-dd3c035b46bd","block_type":"box","text":"Dodd-Frank requires that certain interest rate swaps be executed in regulated markets and submitted for","page_number":50,"box":{"x":102,"y":377,"width":748,"height":12}},{"id":"4ef62006-4f3f-4851-9e0d-78f20592652a","block_type":"box","text":"clearing to regulated clearinghouses. See “—Regulation of Derivatives — Dodd-Frank Regulations” above. Other","page_number":50,"box":{"x":69,"y":392,"width":799,"height":12}},{"id":"5c6adea9-499c-40f7-aacd-3d042be364f9","block_type":"box","text":"interest rate swaps are permitted, although not required, to be cleared. Most of the interest rate swaps entered into","page_number":50,"box":{"x":70,"y":407,"width":829,"height":12}},{"id":"76ffa483-6bd7-4e3a-a19a-5b7ad1acbaa2","block_type":"box","text":"by the Funds are cleared. The Funds face counterparty risk with respect to the clearinghouse when entering into","page_number":50,"box":{"x":69,"y":423,"width":797,"height":11}},{"id":"c8d2e5c1-b270-4b03-a6a5-88ec63551121","block_type":"box","text":"cleared interest rate swaps.","page_number":50,"box":{"x":69,"y":438,"width":198,"height":11}},{"id":"818b20f8-6bbd-4689-8401-ec43773d28a7","block_type":"box","text":"The Funds face significant counterparty risk with respect to their counterparties to non-cleared interest rate","page_number":50,"box":{"x":101,"y":460,"width":766,"height":12}},{"id":"9b3ffced-57ab-41d6-9eaf-2cdb90bfa2bf","block_type":"box","text":"swaps and interest rate caps and floors. The typical counterparties for a Fund’s non-cleared interest rate derivatives","page_number":50,"box":{"x":69,"y":475,"width":829,"height":12}},{"id":"7f9613ac-dae6-4a9c-9f27-239ba60c2389","block_type":"box","text":"transactions are swap dealers and other creditworthy entities that have substantial capital or that have provided the","page_number":50,"box":{"x":68,"y":491,"width":830,"height":11}},{"id":"6e9d2c18-d790-4b91-a8ce-c55bad2774b6","block_type":"box","text":"Fund with a third-party guaranty or other credit support. If the Fund’s counterparty defaults on such a transaction, a","page_number":50,"box":{"x":70,"y":506,"width":822,"height":11}},{"id":"3871df4f-0664-4199-b6ce-274f24a01805","block_type":"box","text":"Fund will have contractual remedies with respect to the transaction but there can be no guarantee that the Fund will","page_number":50,"box":{"x":70,"y":521,"width":824,"height":11}},{"id":"dca4b2d4-b625-41a2-ace6-7583192ea31f","block_type":"box","text":"be successful in enforcing such remedies. The market for interest rate swaps is relatively liquid in comparison with","page_number":50,"box":{"x":69,"y":536,"width":819,"height":11}},{"id":"e138f457-ee8c-424d-bb80-93a383798556","block_type":"box","text":"other similar instruments traded in the interbank market. A Fund may be limited in its ability to enter into certain","page_number":50,"box":{"x":69,"y":551,"width":801,"height":11}},{"id":"65763b5a-975a-42c8-b727-fe13afd09e09","block_type":"box","text":"interest rate derivatives due to applicable income tax requirements.","page_number":50,"box":{"x":70,"y":566,"width":480,"height":11}},{"id":"5eefcf18-2049-476e-9a86-17542588e04d","block_type":"box","text":"Interest rate swaps are transactions in which each party makes periodic interest payments based on a fixed or","page_number":50,"box":{"x":102,"y":589,"width":790,"height":11}},{"id":"0ab802d0-ae57-4c98-bbf9-359343f2872a","block_type":"box","text":"variable interest rate, index or asset in return for periodic payments from its counterparty based on a different fixed","page_number":50,"box":{"x":68,"y":604,"width":825,"height":11}},{"id":"4b93dbf4-8769-42b5-a8ee-b1757bf3aa47","block_type":"box","text":"or variable interest rate, index or asset.","page_number":50,"box":{"x":69,"y":619,"width":280,"height":11}},{"id":"83e5a480-2a5c-4fae-9c75-030724371840","block_type":"box","text":"The purchase of an interest rate floor entitles the purchaser, to the extent that a specified index falls below a","page_number":50,"box":{"x":101,"y":642,"width":780,"height":11}},{"id":"247ea5c5-3109-4a87-985c-514d3948480a","block_type":"box","text":"predetermined interest rate, to receive payments of interest on a notional principal amount from the party selling","page_number":50,"box":{"x":70,"y":657,"width":805,"height":11}},{"id":"dc4bf1be-093f-42ab-8b82-62374e8bd4b1","block_type":"box","text":"such interest rate floor.","page_number":50,"box":{"x":69,"y":672,"width":165,"height":9}},{"id":"1dec683c-ac2d-4de0-a851-9a0d4f060cbd","block_type":"box","text":"The purchase of an interest rate cap entitles the purchaser, to the extent that a specified index rises above a","page_number":50,"box":{"x":101,"y":695,"width":780,"height":11}},{"id":"827168ae-c16d-4e09-a478-c8742f42e8e7","block_type":"box","text":"predetermined interest rate, to receive payments of interest on a notional principal amount from the party selling","page_number":50,"box":{"x":70,"y":710,"width":805,"height":11}},{"id":"f24235f6-1a72-4ad3-af84-63febd39f940","block_type":"box","text":"such interest rate cap.","page_number":50,"box":{"x":69,"y":725,"width":159,"height":11}},{"id":"8143b2b5-eb9e-4bad-be5b-2a9c3f40bfbd","block_type":"box","text":"A Fund may enter into an interest rate swap to effectively exchange with another party their respective","page_number":50,"box":{"x":101,"y":748,"width":729,"height":11}},{"id":"2d58a896-2135-4be7-91e8-4efbafb1249d","block_type":"box","text":"commitments to pay or receive interest,","page_number":50,"box":{"x":69,"y":763,"width":282,"height":11}},{"id":"225a9698-ef2c-4760-821b-30ecbf153ad8","block_type":"box","text":"e.g.","page_number":50,"box":{"x":359,"y":764,"width":24,"height":10}},{"id":"3d51e691-6518-42c8-90ea-884b84e0db84","block_type":"box","text":", an exchange of fixed rate payments for floating rate payments. For","page_number":50,"box":{"x":386,"y":763,"width":482,"height":11}},{"id":"f2b035c3-75da-4411-813f-2ede17bc2f37","block_type":"box","text":"example, if a Fund holds a mortgage-backed security with an interest rate that is reset only once each year, it may","page_number":50,"box":{"x":69,"y":778,"width":814,"height":11}},{"id":"323158a2-91b5-4329-afa0-017c28402558","block_type":"box","text":"swap the right to receive interest at this fixed rate for the right to receive interest at a rate that is reset every week.","page_number":50,"box":{"x":69,"y":793,"width":823,"height":11}},{"id":"4fd4d975-9375-4aed-8e80-7e30566990b0","block_type":"box","text":"This would enable a Fund to offset a decline in the value of the mortgage-backed security due to rising interest rates","page_number":50,"box":{"x":68,"y":808,"width":832,"height":11}},{"id":"cb030aa1-1b0a-4785-9834-e35cf0a3f8dd","block_type":"box","text":"but would also limit its ability to benefit from falling interest rates. Conversely, if a Fund holds a mortgage-backed","page_number":50,"box":{"x":69,"y":823,"width":807,"height":12}},{"id":"1859378a-3086-4993-8bfa-3c9351aa383a","block_type":"box","text":"security with an interest rate that is reset every week and it would like to lock in what it believes to be a high interest","page_number":50,"box":{"x":69,"y":839,"width":836,"height":11}},{"id":"f058103a-77fc-48c5-8460-53e3cf439069","block_type":"box","text":"rate for one year, it may swap the right to receive interest at this variable weekly rate for the right to receive interest","page_number":50,"box":{"x":69,"y":853,"width":826,"height":12}},{"id":"0abb79bd-34b1-4b32-9fa6-20c974c04585","block_type":"box","text":"at a rate that is fixed for one year. Such a swap would protect the Fund from a reduction in yield due to falling interest","page_number":50,"box":{"x":69,"y":869,"width":840,"height":11}},{"id":"1d68d4e1-9445-469a-977d-7016ec1ccee0","block_type":"box","text":"rates and may permit the Fund to enhance its income through the positive differential between one week and one","page_number":50,"box":{"x":69,"y":884,"width":810,"height":11}},{"id":"863c0bf9-9dcb-493c-99d7-c03bbd524d31","block_type":"box","text":"year interest rates, but would preclude it from taking full advantage of rising interest rates.","page_number":50,"box":{"x":68,"y":899,"width":646,"height":11}},{"id":"09b33218-5576-46ad-a09c-93a261e6493e","block_type":"box","text":"II-19","page_number":50,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"36967220-e12e-4bc5-b7fe-12ad98c703ca","block_type":"box","text":"NM0926U-5977317-50/232","page_number":50,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"9969829c-ab3b-4e6a-9f28-52d2c9f9509a","block_type":"box","text":"Gains from transactions in interest rate swaps distributed to shareholders will be taxable as ordinary income or,","page_number":51,"box":{"x":102,"y":45,"width":798,"height":11}},{"id":"ef269696-97c0-42f3-a8fa-9d89e229ec6b","block_type":"box","text":"in certain circumstances, as long term capital gains to shareholders.","page_number":51,"box":{"x":70,"y":60,"width":490,"height":11}},{"id":"7256ff66-f3fa-484a-9151-c03c8e53cfa9","block_type":"box","text":"Interest rate swaps and interest rate caps and floors may be subject to correlation risk, leverage risk, illiquidity","page_number":51,"box":{"x":102,"y":82,"width":791,"height":12}},{"id":"3844acf6-c34f-4871-bf34-e77c971fa6cf","block_type":"box","text":"risk and market risk. See “—Risk Factors in Derivatives” above.","page_number":51,"box":{"x":69,"y":98,"width":454,"height":9}},{"id":"83985641-6ed5-4810-b543-143b5f5a2a6f","block_type":"box","text":"Total Return Swaps.","page_number":51,"box":{"x":103,"y":120,"width":139,"height":11}},{"id":"38b1363c-d20d-493d-9244-c4f4aadf34c5","block_type":"box","text":"Total return swaps are contracts in which one party agrees to make periodic payments to","page_number":51,"box":{"x":249,"y":120,"width":634,"height":12}},{"id":"509ff049-3c4c-446d-8c31-bc6e0275e489","block_type":"box","text":"the other party based on the return of the assets underlying the contract in exchange for periodic payments based on","page_number":51,"box":{"x":68,"y":135,"width":838,"height":12}},{"id":"6f50b720-dfa7-4e9b-863f-aaab0043e8da","block_type":"box","text":"a fixed or variable interest rate or the total return from different underlying assets. The return of the assets","page_number":51,"box":{"x":69,"y":150,"width":764,"height":12}},{"id":"c3faf581-aa8d-4c0c-b97c-ab9520645be8","block_type":"box","text":"underlying the contract includes both the income generated by the asset and the change in market value of the","page_number":51,"box":{"x":69,"y":166,"width":791,"height":11}},{"id":"86afbcac-93c6-4370-b5d4-ae7a084bb719","block_type":"box","text":"asset. The asset underlying the contract may include a specified security, basket of securities or securities indices.","page_number":51,"box":{"x":69,"y":181,"width":821,"height":11}},{"id":"b4352296-8c2f-4561-9f16-374d7b94c0cd","block_type":"box","text":"Total return swaps on a specified security, basket of securities or securities indices may sometimes be referred to as","page_number":51,"box":{"x":68,"y":196,"width":838,"height":11}},{"id":"4c7d27a2-5630-4d05-8190-243451e8d3a5","block_type":"box","text":"“contracts for difference.”","page_number":51,"box":{"x":70,"y":211,"width":184,"height":9}},{"id":"fa156bf6-f90a-4d08-8018-61d6bd6b4dfc","block_type":"box","text":"Total return swaps may be used to obtain exposure to a security or market without owning or taking physical","page_number":51,"box":{"x":101,"y":234,"width":770,"height":11}},{"id":"7427990b-0ee4-45fb-9a5e-90644d972798","block_type":"box","text":"custody of such security or investing directly in such market. Upon entering into a total return swap, a Fund is","page_number":51,"box":{"x":69,"y":249,"width":780,"height":11}},{"id":"000a5d5a-4963-43d1-b1e7-a125a2abdf47","block_type":"box","text":"required to deposit initial margin but the parties do not exchange the notional amount. As a result, total return swaps","page_number":51,"box":{"x":69,"y":264,"width":839,"height":11}},{"id":"12fb6884-e8b0-4aa4-8922-a2f6713a71d7","block_type":"box","text":"may effectively add leverage to the Fund’s portfolio because the Fund would be subject to investment exposure on","page_number":51,"box":{"x":69,"y":279,"width":816,"height":11}},{"id":"a43ec39e-7c46-4099-849e-04946d8cae1d","block_type":"box","text":"the notional amount of the swap.","page_number":51,"box":{"x":68,"y":294,"width":235,"height":11}},{"id":"ef9f9c80-77b7-4784-b181-6868a3552b9e","block_type":"box","text":"Total return swaps are subject to significant correlation risk, leverage risk, illiquidity risk, market risk and","page_number":51,"box":{"x":101,"y":317,"width":746,"height":11}},{"id":"a60967b5-9e42-4ac2-a68d-f4444702ec44","block_type":"box","text":"counterparty risk. See “—Risk Factors in Derivatives” above.","page_number":51,"box":{"x":69,"y":332,"width":433,"height":11}},{"id":"41d63e20-1c57-4d8e-9cfa-1f0d895a1669","block_type":"box","text":"Options.","page_number":51,"box":{"x":102,"y":355,"width":57,"height":11}},{"id":"27f6c3c3-0997-4f3f-98ef-8254f0045a4b","block_type":"box","text":"Options on Securities and Securities Indices.","page_number":51,"box":{"x":102,"y":377,"width":319,"height":11}},{"id":"e459583a-c078-44e8-b8df-a7d3b553da4b","block_type":"box","text":"A Fund may engage in transactions in options on individual","page_number":51,"box":{"x":427,"y":377,"width":418,"height":12}},{"id":"a9f773c8-913e-4056-8adb-9da87b5a7e58","block_type":"box","text":"securities, baskets of securities or securities indices, or particular measurements of value or rates, such as an index","page_number":51,"box":{"x":69,"y":392,"width":838,"height":11}},{"id":"7f05f435-4690-4328-b371-63b93b061640","block_type":"box","text":"of the price of treasury securities or an index representative of short-term interest rates. Such investments may be","page_number":51,"box":{"x":69,"y":407,"width":820,"height":12}},{"id":"595ea4ca-08dd-4ae1-b778-93afe2d0e18b","block_type":"box","text":"made on exchanges and in the OTC markets. In general, exchange-traded options have standardized exercise prices","page_number":51,"box":{"x":69,"y":423,"width":826,"height":11}},{"id":"0b45f186-e8d1-4603-a6bb-8af66923dbbb","block_type":"box","text":"and expiration dates and require the parties to post margin against their obligations, and the performance of the","page_number":51,"box":{"x":69,"y":438,"width":806,"height":11}},{"id":"8e4e39ea-1f3f-489f-a25f-6b4d477d876b","block_type":"box","text":"parties’ obligations in connection with such options is guaranteed by the exchange or a related clearing corporation.","page_number":51,"box":{"x":70,"y":453,"width":825,"height":11}},{"id":"45b0dc02-275a-4d11-9415-b081fab9d43a","block_type":"box","text":"OTC options have more flexible terms negotiated between the buyer and the seller, but are subject to greater credit","page_number":51,"box":{"x":69,"y":468,"width":822,"height":11}},{"id":"7f5de6c2-f092-443d-b761-4a5df7283184","block_type":"box","text":"risk. OTC options also involve greater illiquidity risk.","page_number":51,"box":{"x":69,"y":483,"width":366,"height":11}},{"id":"4d29ca3e-0b95-4155-ac58-d1a8d28fb048","block_type":"box","text":"A Fund may also engage in transactions in options which have additional features that result in different","page_number":51,"box":{"x":101,"y":506,"width":743,"height":11}},{"id":"f9616715-723c-4f20-ba87-d478897c7a58","block_type":"box","text":"payment structures and/or expirations (commonly referred to as exotic options). For example, barrier options are","page_number":51,"box":{"x":70,"y":521,"width":804,"height":11}},{"id":"0f59f2aa-467d-42a4-8929-87638bd76c5f","block_type":"box","text":"exotic options that can only be exercised (or automatically expire) if the price of the underlying asset reaches one or","page_number":51,"box":{"x":69,"y":536,"width":827,"height":11}},{"id":"f3ecc3ec-8125-46f5-a95b-5299208589b6","block_type":"box","text":"more predetermined levels on or before expiration. Binary options are another example of exotic options which have","page_number":51,"box":{"x":69,"y":551,"width":827,"height":11}},{"id":"4eda63de-3f63-44a1-a397-3841e2e9e96e","block_type":"box","text":"a fixed all-or-nothing payout if one or more predetermined conditions are met. Exotic options are typically traded in","page_number":51,"box":{"x":69,"y":566,"width":812,"height":11}},{"id":"a4bfe06f-675f-48f3-9729-51315b1e99ee","block_type":"box","text":"OTC markets.","page_number":51,"box":{"x":69,"y":581,"width":95,"height":9}},{"id":"6a0e999a-3bb2-49e1-8392-83473e88671b","block_type":"box","text":"There are several risks associated with transactions in options on securities and indexes. For example, there are","page_number":51,"box":{"x":101,"y":604,"width":806,"height":11}},{"id":"3381402f-56ba-48c6-8f04-9a1be4938780","block_type":"box","text":"significant differences between the securities and options markets that could result in an imperfect correlation","page_number":51,"box":{"x":69,"y":619,"width":791,"height":11}},{"id":"5a4d80b5-6648-4ea5-b173-d417e416cd6d","block_type":"box","text":"between these markets, causing a given transaction not to achieve its objectives. In addition, a liquid market for","page_number":51,"box":{"x":69,"y":634,"width":801,"height":12}},{"id":"d1633b3a-4207-4d25-ae10-37abb07bdacb","block_type":"box","text":"particular options, whether traded OTC or on a national securities exchange (“Exchange”) may be absent for reasons","page_number":51,"box":{"x":70,"y":649,"width":831,"height":12}},{"id":"363f6536-8300-4a30-9b1b-cd2b5d27520a","block_type":"box","text":"which include the following: there may be insufficient trading interest in certain options; restrictions may be imposed","page_number":51,"box":{"x":68,"y":664,"width":833,"height":12}},{"id":"cab4271a-9e83-44a2-8dbd-87ca18713d1a","block_type":"box","text":"by an Exchange on opening transactions or closing transactions or both; trading halts, suspensions or other","page_number":51,"box":{"x":69,"y":680,"width":769,"height":11}},{"id":"a353d14e-507e-47b3-bdbc-a7117ca12e34","block_type":"box","text":"restrictions may be imposed with respect to particular classes or series of options or underlying securities; unusual","page_number":51,"box":{"x":69,"y":695,"width":824,"height":11}},{"id":"9d3b02cc-0539-4e5f-aedd-de6cf254bf39","block_type":"box","text":"or unforeseen circumstances may interrupt normal operations on an Exchange; the facilities of an Exchange or the","page_number":51,"box":{"x":69,"y":710,"width":816,"height":11}},{"id":"67761037-f491-419f-aee6-8123cc875a6f","block_type":"box","text":"Options Clearing Corporation may not at all times be adequate to handle current trading volume; or one or more","page_number":51,"box":{"x":69,"y":725,"width":796,"height":11}},{"id":"d3a361ca-8a15-4652-801b-dd3b58b0e573","block_type":"box","text":"Exchanges could, for economic or other reasons, decide or be compelled at some future date to discontinue the","page_number":51,"box":{"x":70,"y":740,"width":798,"height":11}},{"id":"d44e38d4-9287-4092-9ccb-b3fdd29c4bbc","block_type":"box","text":"trading of options (or a particular class or series of options), in which event the market on that Exchange (or in that","page_number":51,"box":{"x":68,"y":755,"width":822,"height":11}},{"id":"388f8133-717d-41f4-9d69-a106686ebf2a","block_type":"box","text":"class or series of options) would cease to exist, although outstanding options that had been issued by the Options","page_number":51,"box":{"x":69,"y":770,"width":818,"height":12}},{"id":"8c72b9f5-64d0-4bd7-bffc-3e4ff1a3a52b","block_type":"box","text":"Clearing Corporation as a result of trades on that Exchange would continue to be exercisable in accordance with their","page_number":51,"box":{"x":69,"y":785,"width":836,"height":12}},{"id":"6bd68cc1-3e08-4a7b-b4a3-2b462dd7939a","block_type":"box","text":"terms.","page_number":51,"box":{"x":68,"y":801,"width":45,"height":9}},{"id":"f2c7a58b-85df-4156-8df0-2867a659881e","block_type":"box","text":"Each of the options exchanges has established limitations governing the maximum number of call or put options","page_number":51,"box":{"x":102,"y":823,"width":801,"height":12}},{"id":"0d47c762-6280-4238-a1d9-7b3823b3e697","block_type":"box","text":"on the same asset that may be bought or written by a single investor, whether acting alone or in concert with others","page_number":51,"box":{"x":69,"y":839,"width":826,"height":11}},{"id":"be34d193-7acb-4146-ab5f-4f5aac85dce1","block_type":"box","text":"(regardless of whether such options are written on the same or different exchanges or are held or written on one or","page_number":51,"box":{"x":69,"y":853,"width":823,"height":12}},{"id":"a976e86f-f911-4e49-8914-8845206b9767","block_type":"box","text":"more accounts or through one or more brokers). Under these limitations, option positions of all investment","page_number":51,"box":{"x":69,"y":869,"width":762,"height":11}},{"id":"bc6a7c4c-a756-4e5d-bde5-1fa32c038a9f","block_type":"box","text":"companies advised by the Manager are combined for purposes of these limits. Pursuant to these limitations, an","page_number":51,"box":{"x":69,"y":884,"width":798,"height":11}},{"id":"5e993c6e-0bec-4d20-a0c5-5bb364d17c7b","block_type":"box","text":"II-20","page_number":51,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"af5743e6-e8a6-43ca-93e4-6410a5deae71","block_type":"box","text":"NM0926U-5977317-51/232","page_number":51,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"12755d3f-d376-4d52-888b-cb7651bf3741","block_type":"box","text":"exchange may order the liquidation of positions and may impose other sanctions or restrictions. These position limits","page_number":52,"box":{"x":69,"y":45,"width":837,"height":11}},{"id":"6385ab42-3460-46ce-9c47-377a96237b72","block_type":"box","text":"may restrict the number of listed options that a Fund may buy or sell.","page_number":52,"box":{"x":69,"y":60,"width":491,"height":11}},{"id":"64fe8437-5178-4f1a-8056-b236215fc0e6","block_type":"box","text":"Call Options.","page_number":52,"box":{"x":102,"y":83,"width":89,"height":10}},{"id":"15f98e5d-ebb5-4541-841b-023ffc8a9ab2","block_type":"box","text":"A Fund may purchase call options on any of the types of securities or instruments in which it may","page_number":52,"box":{"x":197,"y":82,"width":694,"height":12}},{"id":"91a45fca-6130-44da-9905-4cea43d51630","block_type":"box","text":"invest. A purchased call option gives a Fund the right to buy, and obligates the seller to sell, the underlying security at","page_number":52,"box":{"x":70,"y":98,"width":838,"height":11}},{"id":"17d9a724-e25f-4516-84b7-3e44ce463755","block_type":"box","text":"the exercise price at any time during the option period. A Fund also may purchase and sell call options on indices.","page_number":52,"box":{"x":68,"y":113,"width":813,"height":11}},{"id":"d17814af-55df-4ddc-8e85-baac0763dec2","block_type":"box","text":"Index options are similar to options on securities except that, rather than taking or making delivery of securities","page_number":52,"box":{"x":70,"y":128,"width":795,"height":11}},{"id":"586e0c71-ecb4-4a94-8aaf-b8efbeb5239a","block_type":"box","text":"underlying the option at a specified price upon exercise, an index option gives the holder the right to receive cash","page_number":52,"box":{"x":69,"y":143,"width":807,"height":11}},{"id":"630032d9-cffa-4639-b52c-aac56830bbca","block_type":"box","text":"upon exercise of the option if the level of the index upon which the option is based is greater than the exercise price","page_number":52,"box":{"x":69,"y":158,"width":830,"height":11}},{"id":"f8857da5-e2b8-4ae2-b8b7-a042979fc392","block_type":"box","text":"of the option.","page_number":52,"box":{"x":69,"y":173,"width":93,"height":11}},{"id":"865e3034-5407-4c3a-abcc-20850cc27e9b","block_type":"box","text":"A written call option is covered if a Fund holds a call on the same security or index as the call written where the","page_number":52,"box":{"x":101,"y":196,"width":794,"height":11}},{"id":"545c9ffc-7cf4-44bc-b2cc-0485f91fa0e5","block_type":"box","text":"exercise price of the call held is (i) equal to or less than the exercise price of the call written, or (ii) greater than the","page_number":52,"box":{"x":69,"y":211,"width":823,"height":11}},{"id":"98515809-c626-4acb-9db7-79ee13807fdd","block_type":"box","text":"exercise price of the call written provided the difference is maintained by the Fund in assets which are not considered","page_number":52,"box":{"x":69,"y":226,"width":839,"height":11}},{"id":"a687ed31-7902-49c9-bc12-9ffeff2b2c8b","block_type":"box","text":"illiquid investments under the Funds’ Liquidity Program (as defined below) (“liquid assets”) designated on the","page_number":52,"box":{"x":70,"y":241,"width":778,"height":11}},{"id":"72e1f0b2-0f99-4d56-abf9-472ac689cbe9","block_type":"box","text":"Manager’s or the sub-adviser’s books and records to the extent required by Commission guidelines.","page_number":52,"box":{"x":70,"y":256,"width":711,"height":12}},{"id":"4daf2b69-ff50-4022-b73f-7d4c569dece9","block_type":"box","text":"A Fund may write (","page_number":52,"box":{"x":101,"y":279,"width":130,"height":11}},{"id":"bbe59414-9cb3-4efb-8222-0150651b0eeb","block_type":"box","text":"i.e.","page_number":52,"box":{"x":233,"y":279,"width":20,"height":9}},{"id":"caee9b9c-2ec9-4aaf-aab2-2366cfaca5ac","block_type":"box","text":", sell) covered call options on the securities or instruments in which it may invest and to","page_number":52,"box":{"x":256,"y":279,"width":627,"height":11}},{"id":"ccb3ce83-cffb-4196-98b0-960c8042ae04","block_type":"box","text":"enter into closing purchase transactions with respect to certain of such options. A covered call option is an option in","page_number":52,"box":{"x":69,"y":294,"width":831,"height":11}},{"id":"aa8d1cdc-bdfb-4794-a385-72f7598c35d5","block_type":"box","text":"which a Fund, in return for a premium, gives another party a right to buy specified securities owned by the Fund at a","page_number":52,"box":{"x":68,"y":309,"width":827,"height":11}},{"id":"ff74abb2-75b7-4ba8-94c3-86855f6790e3","block_type":"box","text":"specified future date and price set at the time of the contract. The principal reason for writing call options is the","page_number":52,"box":{"x":69,"y":324,"width":797,"height":12}},{"id":"46bae5bd-4e8c-4245-8138-3f770544e153","block_type":"box","text":"attempt to realize, through the receipt of premiums, a greater return than would be realized on the securities alone.","page_number":52,"box":{"x":69,"y":339,"width":823,"height":12}},{"id":"de69cc8a-8364-46ea-a0a8-68eb9e1c4c57","block_type":"box","text":"By writing covered call options, a Fund gives up the opportunity, while the option is in effect, to profit from any price","page_number":52,"box":{"x":70,"y":355,"width":823,"height":11}},{"id":"0cf6f931-8473-4a3d-8404-d687c3f14324","block_type":"box","text":"increase in the underlying security above the option exercise price. In addition, a Fund’s ability to sell the underlying","page_number":52,"box":{"x":70,"y":370,"width":825,"height":11}},{"id":"e8baaffe-ff41-4fe1-8bbd-001caf1f5b54","block_type":"box","text":"security will be limited while the option is in effect unless the Fund enters into a closing purchase transaction. A","page_number":52,"box":{"x":69,"y":385,"width":800,"height":11}},{"id":"ecc3886e-2ab5-4286-bc37-f06d891d19d9","block_type":"box","text":"closing purchase transaction cancels out a Fund’s position as the writer of an option by means of an offsetting","page_number":52,"box":{"x":69,"y":400,"width":792,"height":11}},{"id":"15c82560-1d93-4472-be0f-4c28bf4d4e77","block_type":"box","text":"purchase of an identical option prior to the expiration of the option it has written. Covered call options also serve as","page_number":52,"box":{"x":70,"y":415,"width":826,"height":11}},{"id":"bdc6b075-a0e8-44ce-bcd7-e2352334b583","block_type":"box","text":"a partial hedge to the extent of the premium received against the price of the underlying security declining.","page_number":52,"box":{"x":69,"y":430,"width":760,"height":11}},{"id":"00af9fbf-adfc-4357-aab3-09c9ce71607e","block_type":"box","text":"A Fund may write","page_number":52,"box":{"x":101,"y":453,"width":120,"height":11}},{"id":"e704c808-ce9d-4445-9539-553c807c3e6d","block_type":"box","text":"(i.e.","page_number":52,"box":{"x":228,"y":453,"width":25,"height":11}},{"id":"c4e90c27-3e9e-4418-b483-b1e178780d7e","block_type":"box","text":", sell) uncovered call options on securities or instruments in which it may invest but that","page_number":52,"box":{"x":256,"y":453,"width":628,"height":11}},{"id":"2c8a4596-812d-4d4f-8ed1-271e93068817","block_type":"box","text":"are not currently held by the Fund. The principal reason for writing uncovered call options is to realize income without","page_number":52,"box":{"x":69,"y":468,"width":834,"height":11}},{"id":"6d404583-4d9c-447e-a83b-f064b59df4e2","block_type":"box","text":"committing capital to the ownership of the underlying securities or instruments. When writing uncovered call options,","page_number":52,"box":{"x":69,"y":483,"width":830,"height":11}},{"id":"9e5420ef-8e43-4425-9ae2-d0c36e5e23ba","block_type":"box","text":"a Fund must deposit and maintain sufficient margin with the broker-dealer through which it made the uncovered call","page_number":52,"box":{"x":69,"y":498,"width":825,"height":11}},{"id":"8fee8601-c229-4d7f-a5a1-af1aa432926d","block_type":"box","text":"option as collateral to ensure that the securities can be purchased for delivery if and when the option is exercised.","page_number":52,"box":{"x":69,"y":513,"width":818,"height":11}},{"id":"0b2594ef-cedb-4594-bdeb-362a5a6d6d80","block_type":"box","text":"During periods of declining securities prices or when prices are stable, writing uncovered calls can be a profitable","page_number":52,"box":{"x":70,"y":528,"width":806,"height":12}},{"id":"3b68548a-96ec-491b-9ecc-bbc24ba2be19","block_type":"box","text":"strategy to increase a Fund’s income with minimal capital risk. Uncovered calls are riskier than covered calls because","page_number":52,"box":{"x":69,"y":544,"width":839,"height":11}},{"id":"0284d4d5-a968-4062-acae-28e936894e76","block_type":"box","text":"there is no underlying security held by a Fund that can act as a partial hedge. Uncovered calls have speculative","page_number":52,"box":{"x":68,"y":559,"width":793,"height":11}},{"id":"82b59caa-a3dc-4836-978c-cc01668a64e0","block_type":"box","text":"characteristics and the potential for loss is unlimited. When an uncovered call is exercised, a Fund must purchase","page_number":52,"box":{"x":69,"y":574,"width":814,"height":11}},{"id":"da393c9d-cafb-4021-aa79-850a8783aafc","block_type":"box","text":"the underlying security to meet its call obligation. There is also a risk, especially with preferred and debt securities","page_number":52,"box":{"x":68,"y":589,"width":818,"height":11}},{"id":"628d50df-341e-4109-89f5-6084dd3a0705","block_type":"box","text":"that lack sufficient liquidity, that the securities may not be available for purchase. If the purchase price exceeds the","page_number":52,"box":{"x":68,"y":604,"width":825,"height":11}},{"id":"d29afefa-e0bc-4e0e-ae17-f33f81c23f21","block_type":"box","text":"exercise price, a Fund will lose the difference.","page_number":52,"box":{"x":69,"y":619,"width":326,"height":11}},{"id":"de6fd5ed-63b5-4ed1-b0ce-44f0236f3ce7","block_type":"box","text":"Put Options.","page_number":52,"box":{"x":102,"y":642,"width":85,"height":11}},{"id":"29a09c8d-c1fa-4e12-a0fe-fff6be36aefa","block_type":"box","text":"A Fund may purchase put options to seek to hedge against a decline in the value of its securities or","page_number":52,"box":{"x":194,"y":642,"width":712,"height":11}},{"id":"753788c0-25f2-4069-b6cc-683796e5996e","block_type":"box","text":"to enhance its return. By buying a put option, a Fund acquires a right to sell the underlying securities or instruments","page_number":52,"box":{"x":68,"y":657,"width":828,"height":11}},{"id":"ea055bc2-9cd3-423b-a70d-4e8fec11c1fa","block_type":"box","text":"at the exercise price, thus limiting the Fund’s risk of loss through a decline in the market value of the securities or","page_number":52,"box":{"x":69,"y":672,"width":816,"height":11}},{"id":"fa004901-b983-429e-a642-7ddc7a4d7b61","block_type":"box","text":"instruments until the put option expires. The amount of any appreciation in the value of the underlying securities or","page_number":52,"box":{"x":70,"y":687,"width":820,"height":11}},{"id":"f52f6e26-c55b-4d0b-a124-69b34f5e630e","block_type":"box","text":"instruments will be partially offset by the amount of the premium paid for the put option and any related transaction","page_number":52,"box":{"x":70,"y":702,"width":826,"height":11}},{"id":"7f7b0c62-685e-4f09-8311-8855c785480e","block_type":"box","text":"costs. Prior to its expiration, a put option may be sold in a closing sale transaction and profit or loss from the sale","page_number":52,"box":{"x":69,"y":717,"width":815,"height":12}},{"id":"f797acaa-95ff-425b-a542-2ca38873a55a","block_type":"box","text":"will depend on whether the amount received is more or less than the premium paid for the put option plus the related","page_number":52,"box":{"x":68,"y":732,"width":839,"height":11}},{"id":"f359c905-0686-4310-b25e-eda52f9133df","block_type":"box","text":"transaction costs. A closing sale transaction cancels out a Fund’s position as the purchaser of an option by means of","page_number":52,"box":{"x":68,"y":748,"width":841,"height":11}},{"id":"6dad648d-3e20-49c2-8efe-0167d83817ca","block_type":"box","text":"an offsetting sale of an identical option prior to the expiration of the option it has purchased. A Fund also may","page_number":52,"box":{"x":69,"y":763,"width":785,"height":11}},{"id":"643c9111-4c4b-49eb-9395-937f3ccf8c89","block_type":"box","text":"purchase uncovered put options.","page_number":52,"box":{"x":70,"y":778,"width":231,"height":11}},{"id":"e40b5a22-4562-45f2-ae09-9b2fb86696c7","block_type":"box","text":"A Fund also may write (","page_number":52,"box":{"x":101,"y":801,"width":165,"height":11}},{"id":"ef6e2098-fcc5-48b4-88d0-ddc2a5041825","block_type":"box","text":"i.e.","page_number":52,"box":{"x":268,"y":801,"width":20,"height":9}},{"id":"a852ee42-fc47-4074-8d01-ba6e13f3cf2b","block_type":"box","text":", sell) put options on the types of securities or instruments that may be held by the","page_number":52,"box":{"x":291,"y":801,"width":591,"height":11}},{"id":"0d06c37b-53dd-49b9-baca-6c04fd5a0e0e","block_type":"box","text":"Fund. A Fund will receive a premium for writing a put option, which increases the Fund’s return.","page_number":52,"box":{"x":70,"y":816,"width":675,"height":11}},{"id":"ccce5d47-5357-444f-9075-97a747ac6b54","block_type":"box","text":"A Fund also may write (","page_number":52,"box":{"x":101,"y":839,"width":165,"height":10}},{"id":"f32a01f9-2fc5-47ea-8edf-b56d70f55e30","block_type":"box","text":"i.e.","page_number":52,"box":{"x":268,"y":839,"width":20,"height":8}},{"id":"f0853fdf-b41e-468e-875d-5e420faa1e9f","block_type":"box","text":", sell) uncovered put options on securities or instruments in which it may invest but","page_number":52,"box":{"x":291,"y":839,"width":593,"height":10}},{"id":"5c129f4b-a4ab-4ad2-9771-50584b3f8682","block_type":"box","text":"with respect to which the Fund does not currently have a corresponding short position or has not deposited as","page_number":52,"box":{"x":68,"y":854,"width":789,"height":11}},{"id":"c6add0f0-ce18-4931-a91e-a97f3fb64778","block_type":"box","text":"collateral cash equal to the exercise value of the put option with the broker-dealer through which it made the","page_number":52,"box":{"x":69,"y":869,"width":773,"height":11}},{"id":"7b330be5-10b2-45d1-b9b9-8d8a83c418a1","block_type":"box","text":"uncovered put option. The principal reason for writing uncovered put options is to receive premium income and to","page_number":52,"box":{"x":69,"y":884,"width":807,"height":11}},{"id":"854dc7c9-f45a-4cb3-935c-24466d13c791","block_type":"box","text":"acquire such securities or instruments at a net cost below the current market value. A Fund has the obligation to buy","page_number":52,"box":{"x":69,"y":899,"width":835,"height":11}},{"id":"989a7948-33ca-4f52-acf5-cdc90196cddf","block_type":"box","text":"II-21","page_number":52,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"09b2aa60-7f4b-4edc-85d8-9c106c8e5ea8","block_type":"box","text":"NM0926U-5977317-52/232","page_number":52,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"336b6e8b-05b3-4db9-83a3-51106402a6b1","block_type":"box","text":"the securities or instruments at an agreed upon price if the price of the securities or instruments decreases below","page_number":53,"box":{"x":68,"y":45,"width":818,"height":11}},{"id":"ac3abacd-c3b3-4d20-a37a-3dfb2d15ab8e","block_type":"box","text":"the exercise price. If the price of the securities or instruments increases during the option period, the option will","page_number":53,"box":{"x":68,"y":60,"width":800,"height":11}},{"id":"120d934b-6080-4d15-9432-a47a73c762d3","block_type":"box","text":"expire worthless and a Fund will retain the premium and will not have to purchase the securities or instruments at","page_number":53,"box":{"x":69,"y":75,"width":814,"height":11}},{"id":"b5d513a0-bd59-453a-a730-273b5cf6724f","block_type":"box","text":"the exercise price.","page_number":53,"box":{"x":68,"y":90,"width":130,"height":11}},{"id":"b5caac1e-46bc-4f43-942f-0f15d78faffd","block_type":"box","text":"Options on Government National Mor tgage Association (“GNMA”) Cer tificates.","page_number":53,"box":{"x":102,"y":113,"width":556,"height":11}},{"id":"ef1edd15-2e64-48e8-94e1-7eb83d47b629","block_type":"box","text":"The following information relates","page_number":53,"box":{"x":664,"y":113,"width":232,"height":11}},{"id":"3f10158e-1918-4b96-84ae-8eef3c0b5091","block_type":"box","text":"to the unique characteristics of options on GNMA Certificates. Since the remaining principal balance of GNMA","page_number":53,"box":{"x":68,"y":128,"width":784,"height":11}},{"id":"ce256406-7ef8-4d78-b16c-3c015ffdf2d9","block_type":"box","text":"Certificates declines each month as a result of mortgage payments, a Fund, as a writer of a GNMA call holding GNMA","page_number":53,"box":{"x":69,"y":143,"width":840,"height":11}},{"id":"e064c6c6-4085-4339-b9fa-7e3d1e4f9f98","block_type":"box","text":"Certificates as “cover” to satisfy its delivery obligation in the event of exercise, may find that the GNMA Certificates","page_number":53,"box":{"x":69,"y":158,"width":827,"height":11}},{"id":"c042edfd-dcb1-41dc-9574-4ef2b0ef81e8","block_type":"box","text":"it holds no longer have a sufficient remaining principal balance for this purpose. Should this occur, a Fund will","page_number":53,"box":{"x":70,"y":173,"width":781,"height":11}},{"id":"8974192c-1ca3-48df-9a8a-91edd09a4573","block_type":"box","text":"purchase additional GNMA Certificates from the same pool (if obtainable) or other GNMA Certificates in the cash","page_number":53,"box":{"x":70,"y":188,"width":803,"height":11}},{"id":"4e3b7e65-6003-43cd-afc5-595863b93d68","block_type":"box","text":"market in order to maintain its “cover.”","page_number":53,"box":{"x":69,"y":204,"width":277,"height":8}},{"id":"77616ef1-b827-43b0-910e-589882bf1b1b","block_type":"box","text":"A GNMA Certificate held by a Fund to cover an option position in any but the nearest expiration month may cease","page_number":53,"box":{"x":101,"y":226,"width":807,"height":11}},{"id":"711f0228-ae10-423d-80b0-7ecaf263a826","block_type":"box","text":"to represent cover for the option in the event of a decline in the GNMA coupon rate at which new pools are originated","page_number":53,"box":{"x":68,"y":241,"width":835,"height":11}},{"id":"f5a44b02-930c-4a0e-996d-6bcf1de589a6","block_type":"box","text":"under the FHA/VA loan ceiling in effect at any given time. If this should occur, a Fund will no longer be covered, and","page_number":53,"box":{"x":69,"y":256,"width":821,"height":12}},{"id":"174eda66-1353-4ec4-a7a5-bdf86aed7838","block_type":"box","text":"the Fund will either enter into a closing purchase transaction or replace such Certificate with a certificate that","page_number":53,"box":{"x":68,"y":271,"width":784,"height":12}},{"id":"67562509-36d2-4dfd-a769-f4dbb8e34c79","block_type":"box","text":"represents cover. When a Fund closes its position or replaces such Certificate, it may realize an unanticipated loss","page_number":53,"box":{"x":69,"y":286,"width":820,"height":12}},{"id":"6da4aadc-ad85-4b58-a0c7-a5d2970ee84d","block_type":"box","text":"and incur transaction costs.","page_number":53,"box":{"x":69,"y":302,"width":197,"height":9}},{"id":"7d7f9a49-ac59-4bd2-8513-d0c6d30d9ff0","block_type":"box","text":"Options on Swaps (“Swaptions”).","page_number":53,"box":{"x":102,"y":324,"width":235,"height":11}},{"id":"ca1f1f9c-790d-415c-a556-14532611329d","block_type":"box","text":"A swaption gives a counterparty the option (but not the obligation) to enter into","page_number":53,"box":{"x":343,"y":325,"width":563,"height":11}},{"id":"7dae1c0a-a431-416d-8178-f54f47637337","block_type":"box","text":"a new swap agreement or to shorten, extend, cancel or otherwise modify an existing swap agreement, at a","page_number":53,"box":{"x":69,"y":339,"width":763,"height":12}},{"id":"cbcef385-0881-46b1-89dc-06a7a4c5e827","block_type":"box","text":"designated future time on specified terms. A Fund may write (","page_number":53,"box":{"x":69,"y":355,"width":439,"height":11}},{"id":"8e1c6b25-35e0-4e5b-abc6-61de34900c08","block_type":"box","text":"i.e.","page_number":53,"box":{"x":510,"y":355,"width":20,"height":9}},{"id":"23b6aecb-abda-4420-8d7f-629190ba4749","block_type":"box","text":", sell) and purchase put and call swaptions.","page_number":53,"box":{"x":533,"y":355,"width":309,"height":11}},{"id":"37c0c438-40e2-448e-b454-382989d01f57","block_type":"box","text":"Depending on the terms of the particular option agreement, a Fund will generally incur a greater degree of risk when","page_number":53,"box":{"x":70,"y":370,"width":826,"height":11}},{"id":"cfb2548d-9012-4290-9871-05291dc77787","block_type":"box","text":"it writes a swaption than it will incur when it purchases a swaption. When a Fund purchases a swaption, it risks","page_number":53,"box":{"x":70,"y":385,"width":793,"height":11}},{"id":"0862504b-f503-4396-be4d-b39013c4d20f","block_type":"box","text":"losing only the amount of the premium it has paid should it decide to let the option expire unexercised. However,","page_number":53,"box":{"x":70,"y":400,"width":802,"height":11}},{"id":"362f232d-b6d6-4d02-8aea-a74eabaa5caa","block_type":"box","text":"when a Fund writes a swaption, upon exercise of the option the Fund will become obligated according to the terms of","page_number":53,"box":{"x":68,"y":415,"width":836,"height":11}},{"id":"ef2a7be4-f428-4202-9033-3fc9da471d97","block_type":"box","text":"the underlying agreement and the potential for loss may be unlimited. Certain swaptions are permitted, although not","page_number":53,"box":{"x":68,"y":430,"width":832,"height":11}},{"id":"245d068e-2fa0-479c-ad01-e9fb1b082680","block_type":"box","text":"required, to be cleared.","page_number":53,"box":{"x":69,"y":446,"width":165,"height":10}},{"id":"5a5875e2-f5e5-4664-b2d2-5483111de94e","block_type":"box","text":"A Fund will likely enter into these transactions to preserve a return or spread on a particular investment or","page_number":53,"box":{"x":101,"y":468,"width":760,"height":11}},{"id":"aee92568-94d9-4c19-9703-fef6d7322333","block_type":"box","text":"portion of its portfolio or to protect against any increase in the price of securities the Fund anticipates purchasing at","page_number":53,"box":{"x":70,"y":483,"width":830,"height":11}},{"id":"7db76162-c92b-4172-bd8d-f3f556d8b685","block_type":"box","text":"a later date. A Fund generally will use these transactions for hedging purposes, not for speculation.","page_number":53,"box":{"x":69,"y":498,"width":706,"height":11}},{"id":"0a7ae2a8-d136-4894-a120-841b6970e1a6","block_type":"box","text":"Swaptions may be subject to correlation risk, leverage risk, illiquidity risk and market risk. See “—Risk Factors in","page_number":53,"box":{"x":102,"y":521,"width":805,"height":11}},{"id":"3ea39f6b-4758-4180-bab4-d5b6978077fe","block_type":"box","text":"Derivatives” above.","page_number":53,"box":{"x":70,"y":536,"width":135,"height":9}},{"id":"c5f47e2a-6c49-4ff0-a6cb-f5a5c40f325a","block_type":"box","text":"FLEX Options.","page_number":53,"box":{"x":102,"y":559,"width":96,"height":11}},{"id":"0556827d-583d-4909-a63b-f938c85a8f97","block_type":"box","text":"FLEX Options are customized option contracts available through national securities exchanges that","page_number":53,"box":{"x":206,"y":559,"width":702,"height":11}},{"id":"3e3b14dd-48c4-4bdd-be0c-bb1fdeada80b","block_type":"box","text":"are guaranteed for settlement by the Options Clearing Corporation (“OCC”). FLEX Options are listed on a U.S. national","page_number":53,"box":{"x":69,"y":574,"width":839,"height":11}},{"id":"290c481b-4d0b-4cb3-a393-38bfc4bdc74f","block_type":"box","text":"securities exchange. FLEX Options provide investors with the ability to customize assets referenced by the options,","page_number":53,"box":{"x":69,"y":589,"width":818,"height":11}},{"id":"b39f2315-cc5a-4a50-b566-1ffab08f32d2","block_type":"box","text":"exercise prices, exercise styles (","page_number":53,"box":{"x":69,"y":604,"width":231,"height":11}},{"id":"4e168020-37d4-46c8-9237-e763ebd81da9","block_type":"box","text":"i.e.","page_number":53,"box":{"x":302,"y":604,"width":20,"height":9}},{"id":"50cb92b9-477a-4763-beef-71633d9060ef","block_type":"box","text":", American-style, exercisable any time prior to the expiration date, or European","page_number":53,"box":{"x":325,"y":604,"width":561,"height":11}},{"id":"eb11ee47-d4b1-4391-a92b-a586990f42db","block_type":"box","text":"style, exercisable only on the option expiration date) and expiration dates, while achieving price discovery in","page_number":53,"box":{"x":69,"y":619,"width":768,"height":11}},{"id":"ae828968-eaa1-43ba-8748-6c549028bc13","block_type":"box","text":"competitive, transparent auctions markets and avoiding the counterparty exposure of OTC options positions. Each","page_number":53,"box":{"x":69,"y":634,"width":812,"height":12}},{"id":"50983ab7-0d8b-4c3a-a58f-ceb8ce76c7ba","block_type":"box","text":"option contract entitles the holder thereof to purchase (for the call options) or sell (for the put options) shares of the","page_number":53,"box":{"x":69,"y":649,"width":830,"height":11}},{"id":"46969668-38d1-44ad-8a54-98327ce5d248","block_type":"box","text":"reference asset at the strike price. A Fund’s portfolio may include several types of FLEX Options, including both","page_number":53,"box":{"x":69,"y":664,"width":792,"height":12}},{"id":"a078808e-9979-4430-bbd9-65848898b2d4","block_type":"box","text":"purchased and written put and call options (as further described below). The FLEX Options are all European style","page_number":53,"box":{"x":70,"y":680,"width":802,"height":11}},{"id":"8c66cf31-a4f2-430c-9e45-d8f53c15bfc1","block_type":"box","text":"options, which means that they are exercisable at a predetermined specified price (the “strike price”) only on the","page_number":53,"box":{"x":69,"y":695,"width":806,"height":11}},{"id":"e3b5e560-b374-40e6-a5f0-ff91d68fa2e0","block_type":"box","text":"FLEX Option’s expiration date.","page_number":53,"box":{"x":70,"y":710,"width":211,"height":11}},{"id":"1a7ebfe4-f176-4f88-a179-75615de0a002","block_type":"box","text":"The OCC guarantees performance by each of the counterparties to the FLEX Options, becoming the “buyer for","page_number":53,"box":{"x":101,"y":732,"width":783,"height":12}},{"id":"72b1c282-67c9-4173-b6d2-c1241d8acdd0","block_type":"box","text":"every seller and the seller for every buyer”, reducing counterparty risk for clearing members and options traders.","page_number":53,"box":{"x":69,"y":748,"width":802,"height":11}},{"id":"b98533b0-1c6d-4019-bf5a-05b29ed80044","block_type":"box","text":"Although guaranteed for settlement by the OCC, FLEX Options are still subject to counterparty risk with the OCC and","page_number":53,"box":{"x":68,"y":763,"width":826,"height":11}},{"id":"a9863d3e-2721-4aa2-9472-a51f30df6504","block_type":"box","text":"subject to the risk that the OCC may fail to perform the settlement of the FLEX Options due to bankruptcy or other","page_number":53,"box":{"x":69,"y":778,"width":814,"height":11}},{"id":"1ea27f12-8edf-4c81-8bdc-1376f9a175a4","block_type":"box","text":"adverse reasons. A Fund bears the risk that the OCC will be unable or unwilling to perform its obligations under the","page_number":53,"box":{"x":69,"y":793,"width":822,"height":11}},{"id":"0949d284-f44f-48db-9eef-ae3f13c8de5f","block_type":"box","text":"FLEX Options contracts.","page_number":53,"box":{"x":70,"y":808,"width":166,"height":11}},{"id":"61f3b6c9-75e2-4144-9536-b72c4a697506","block_type":"box","text":"Subject to determination by the Securities Committee of the OCC, adjustments may be made to the FLEX","page_number":53,"box":{"x":102,"y":831,"width":748,"height":11}},{"id":"c6754393-ad59-4ef7-be22-bab2d8f31116","block_type":"box","text":"Options for certain events (collectively, “Corporate Actions”) specified in the OCC’s by-laws and rules: certain stock","page_number":53,"box":{"x":69,"y":846,"width":822,"height":11}},{"id":"71cd550a-2fbf-484d-9052-195262c40558","block_type":"box","text":"dividends or distributions, stock splits, reverse stock splits, rights offerings, distributions, reorganizations,","page_number":53,"box":{"x":69,"y":861,"width":759,"height":11}},{"id":"e714c71d-6308-4522-9c8a-7cc80c67d33d","block_type":"box","text":"recapitalizations, or reclassifications with respect to an underlying security, or a merger, consolidation, dissolution or","page_number":53,"box":{"x":69,"y":876,"width":833,"height":11}},{"id":"57f36212-f86a-4d36-913f-11b56d76231d","block_type":"box","text":"liquidation of the issuer of the underlying security. According to the OCC’s by-laws, the nature and extent of any such","page_number":53,"box":{"x":70,"y":891,"width":829,"height":12}},{"id":"4c091595-c385-4e45-ad9a-b2104d386a91","block_type":"box","text":"adjustment is to be determined by the OCC’s Securities Committee, in light of the circumstances known to it at the","page_number":53,"box":{"x":69,"y":906,"width":821,"height":12}},{"id":"b622ffe2-f3a9-4f99-955e-8db8dd32dca7","block_type":"box","text":"II-22","page_number":53,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"80929c7f-896e-4009-865b-760d93e873dc","block_type":"box","text":"NM0926U-5977317-53/232","page_number":53,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"d87ed41f-4d82-4b23-b48f-cfcc6f0cd35a","block_type":"box","text":"time such determination is made, based on its judgment as to what is appropriate for the protection of investors and","page_number":54,"box":{"x":68,"y":45,"width":835,"height":11}},{"id":"28c73f76-e44e-4d3f-a7ac-1c7510a2d69a","block_type":"box","text":"the public interest, taking into account such factors as fairness to holders and writers (or purchasers and sellers) of","page_number":54,"box":{"x":68,"y":60,"width":829,"height":11}},{"id":"df9d761c-966d-4468-bc56-d962e9924c92","block_type":"box","text":"the affected options, the maintenance of a fair and orderly market in the affected options, consistency of","page_number":54,"box":{"x":68,"y":75,"width":753,"height":11}},{"id":"1209993c-7b8d-410c-92ea-82c33a482157","block_type":"box","text":"interpretation and practice, efficiency of exercise settlement procedures, and the coordination with other clearing","page_number":54,"box":{"x":70,"y":90,"width":806,"height":11}},{"id":"68a1ce8c-ee6c-4fe9-9a28-8b3b50edfb18","block_type":"box","text":"agencies of the clearance and settlement of transactions in the underlying interest.","page_number":54,"box":{"x":69,"y":105,"width":593,"height":11}},{"id":"f6593930-7b4b-40a7-90cf-3e3e5d4202b4","block_type":"box","text":"Cer tain Considerations Regarding Options","page_number":54,"box":{"x":135,"y":128,"width":298,"height":11}},{"id":"72b17979-b3ac-4ed8-93cd-c570d3e039d4","block_type":"box","text":". The FLEX Options in which each Fund may invest will be options","page_number":54,"box":{"x":435,"y":128,"width":461,"height":11}},{"id":"7260307f-d5cb-4d93-8855-c643e0ae0b00","block_type":"box","text":"on an exchange-traded fund (“ETF”) or the S&P 500 Index (together with such ETF, a “Reference Asset”). As","page_number":54,"box":{"x":102,"y":143,"width":768,"height":11}},{"id":"c6e9175b-a5d8-458c-b23d-eda755271cfa","block_type":"box","text":"such, the value of a Fund’s FLEX Options will fluctuate with changes in the value of the securities held by the","page_number":54,"box":{"x":102,"y":158,"width":775,"height":11}},{"id":"396ff290-1ad4-4821-ad12-35839e3b8fb2","block_type":"box","text":"ETF, and thus the ETF’s share price. In addition to the value of the ETF, the value of an option, in general, will","page_number":54,"box":{"x":102,"y":173,"width":777,"height":11}},{"id":"d0267214-c759-451f-9cb7-942fb421f7e8","block_type":"box","text":"reflect, among other things, the time remaining until expiration (the end of the Outcome Period), the relationship","page_number":54,"box":{"x":102,"y":188,"width":799,"height":12}},{"id":"8993e73a-0877-43fb-8abc-f69028963d92","block_type":"box","text":"of the exercise price to the market price of the Reference Asset, and general market conditions. Options that","page_number":54,"box":{"x":102,"y":203,"width":777,"height":12}},{"id":"b01fef9d-86b7-4dea-8669-2bc330139123","block_type":"box","text":"expire unexercised have no value.","page_number":54,"box":{"x":101,"y":219,"width":240,"height":10}},{"id":"0109c143-2330-4e97-934b-c849f212f725","block_type":"box","text":"The puts and calls on the Reference Asset entitle the purchaser of the option the right to purchase (for a","page_number":54,"box":{"x":134,"y":241,"width":747,"height":11}},{"id":"22704857-5f2e-442f-b21e-e142491c45b0","block_type":"box","text":"call option) or sell (for a put option) the Reference Asset at a predetermined specified price (the “strike price”).","page_number":54,"box":{"x":101,"y":256,"width":792,"height":11}},{"id":"935ef916-d0af-4154-a855-d95780af7e84","block_type":"box","text":"When a Fund writes a call on the Reference Asset, it receives a premium and agrees that the purchaser of the","page_number":54,"box":{"x":101,"y":271,"width":786,"height":12}},{"id":"3b2fbc11-58e2-487f-bdbf-a0111f2a361e","block_type":"box","text":"call, upon exercise of the call, will receive from the Fund the delivery of a specified number of shares of the ETF","page_number":54,"box":{"x":101,"y":286,"width":798,"height":12}},{"id":"e7f174d4-12b1-4bf9-9ded-8667a3ab60bd","block_type":"box","text":"in exchange for the strike price. When a Fund buys a call on the Reference Asset, it pays a premium and has the","page_number":54,"box":{"x":102,"y":302,"width":802,"height":11}},{"id":"5e6bb6f3-cb66-40ae-b2bb-6b7626d3634b","block_type":"box","text":"same rights to such call as indicated above. When a Fund buys a put on the Reference Asset, it pays a premium","page_number":54,"box":{"x":102,"y":317,"width":800,"height":11}},{"id":"213c4b0a-6a3f-4447-907d-5e3137cabcc3","block_type":"box","text":"and has the right to require the seller of the put, upon the Fund’s exercise of the put, to deliver the specified","page_number":54,"box":{"x":102,"y":332,"width":774,"height":11}},{"id":"cabd64bf-f502-4ed8-ad41-616d2e0587bb","block_type":"box","text":"number of shares of the ETF in exchange for the strike price. When a Fund writes a put on the Reference Asset,","page_number":54,"box":{"x":102,"y":347,"width":793,"height":11}},{"id":"caf3cc59-b653-45fa-9ca2-e4fb84937df5","block_type":"box","text":"it receives a premium and the purchaser of the put has the right to require the Fund to deliver the specified","page_number":54,"box":{"x":102,"y":362,"width":764,"height":11}},{"id":"21b71e3c-01c3-4983-858f-5e5cc56f9826","block_type":"box","text":"number of shares of the ETF in exchange for the strike price.","page_number":54,"box":{"x":102,"y":377,"width":430,"height":12}},{"id":"7dfd8035-cbd5-4ce0-9564-104c72ab69c3","block_type":"box","text":"Although each Fund will generally utilize FLEX Options that are physically settled, a Fund may also utilize","page_number":54,"box":{"x":134,"y":400,"width":740,"height":11}},{"id":"bad1ca69-7e60-4d72-99a3-1f642212719c","block_type":"box","text":"FLEX Options that are cash-settled. Cash-settled options give the holder the right to receive an amount (or owe","page_number":54,"box":{"x":102,"y":415,"width":787,"height":11}},{"id":"a4318e64-b4e4-4234-88d6-197f6fcc25f7","block_type":"box","text":"an amount) of cash upon the exercise of the option. Gain or loss depends on changes in the value of the ETF’s","page_number":54,"box":{"x":102,"y":430,"width":790,"height":11}},{"id":"d28ee366-eeb0-4f41-942d-1200ed8f3bd7","block_type":"box","text":"share price relative to the strike price for a given option contract. The amount of cash is equal to the difference","page_number":54,"box":{"x":102,"y":445,"width":793,"height":12}},{"id":"6625d1b3-eccb-40d2-8aa7-d7c54447f586","block_type":"box","text":"between the closing price of the ETF’s share price and the exercise price of the option contract times a specified","page_number":54,"box":{"x":102,"y":460,"width":802,"height":12}},{"id":"77f5df00-688d-484f-ab54-fe7e46270978","block_type":"box","text":"multiple (“multiplier”), which determines the total value for each point of such difference.","page_number":54,"box":{"x":102,"y":475,"width":635,"height":12}},{"id":"78cf13ce-50e7-4a7f-bcda-34681efb2f14","block_type":"box","text":"Risks of Options on the Reference Assets","page_number":54,"box":{"x":135,"y":498,"width":297,"height":11}},{"id":"85fc4c85-77a7-49cd-ad81-6a9346331ba2","block_type":"box","text":". If a Fund has purchased an option and exercises it before the","page_number":54,"box":{"x":433,"y":498,"width":448,"height":11}},{"id":"07a6af3c-8a6b-4c4c-ace5-b8f83c23ff33","block_type":"box","text":"closing value for that day is available, it runs the risk that the level of the Reference Asset may subsequently","page_number":54,"box":{"x":101,"y":513,"width":777,"height":12}},{"id":"35ab5701-d522-484b-812d-106e1b72289b","block_type":"box","text":"change. If such a change causes the exercised option to fall out of the money, the applicable Fund will be","page_number":54,"box":{"x":101,"y":528,"width":753,"height":12}},{"id":"4aa81201-5539-4639-a826-7901aedc3c4b","block_type":"box","text":"required to pay the difference between the closing Reference Asset value and the exercise price of the option","page_number":54,"box":{"x":102,"y":543,"width":780,"height":12}},{"id":"875fe17a-e972-4059-be6b-688ae1aebdbe","block_type":"box","text":"(times the applicable multiplier) to the assigned writer.","page_number":54,"box":{"x":102,"y":559,"width":387,"height":11}},{"id":"821d8420-a5eb-4414-aabf-0e2dd1f01a76","block_type":"box","text":"Foreign Exchange Transactions.","page_number":54,"box":{"x":102,"y":582,"width":222,"height":11}},{"id":"7e21e408-c1ef-4fe6-a254-746ae79573d5","block_type":"box","text":"A Fund may enter into spot foreign exchange transactions, forward foreign exchange transactions (“FX forwards”)","page_number":54,"box":{"x":101,"y":604,"width":807,"height":11}},{"id":"0c15bcf9-a902-442c-a52a-a5c9e9f501fa","block_type":"box","text":"and currency swaps, purchase and sell currency options, currency futures and related options thereon (collectively,","page_number":54,"box":{"x":69,"y":619,"width":818,"height":11}},{"id":"b3bf779d-7902-42d1-b2e0-aefa7e0b9ea2","block_type":"box","text":"“Currency Instruments”) for purposes of hedging against the decline in the value of currencies in which its portfolio","page_number":54,"box":{"x":70,"y":634,"width":821,"height":12}},{"id":"a550f3cf-7a32-4fe2-9f79-927c458e998f","block_type":"box","text":"holdings are denominated against the U.S. dollar or, with respect to certain Funds, to seek to enhance returns.","page_number":54,"box":{"x":69,"y":649,"width":792,"height":12}},{"id":"a8972fa4-2f5c-4348-a894-caef8a022096","block_type":"box","text":"Such transactions could be effected to hedge with respect to foreign dollar denominated securities owned by a","page_number":54,"box":{"x":102,"y":672,"width":790,"height":11}},{"id":"30fbdd1f-6ae5-490e-9d95-49034b3d4632","block_type":"box","text":"Fund, sold by a Fund but not yet delivered, or committed or anticipated to be purchased by a Fund. As an illustration,","page_number":54,"box":{"x":70,"y":687,"width":830,"height":11}},{"id":"9a25c116-509e-453f-b966-e3ba99b682f4","block_type":"box","text":"a Fund may use such techniques to hedge the stated value in U.S. dollars of an investment in a yen-denominated","page_number":54,"box":{"x":69,"y":702,"width":808,"height":12}},{"id":"e4e49904-0817-433b-a476-b000cb001d6b","block_type":"box","text":"security. For example, the Fund may purchase a foreign currency put option enabling it to sell a specified amount of","page_number":54,"box":{"x":69,"y":717,"width":824,"height":12}},{"id":"1b925249-535a-4bd6-8335-68cac71bdac2","block_type":"box","text":"yen for dollars at a specified price by a future date. To the extent the hedge is successful, a loss in the value of the","page_number":54,"box":{"x":68,"y":732,"width":823,"height":12}},{"id":"42099bc3-a5a7-44cb-8bc5-53370610d21a","block_type":"box","text":"yen relative to the dollar will tend to be offset by an increase in the value of the put option. To offset, in whole or in","page_number":54,"box":{"x":68,"y":748,"width":821,"height":11}},{"id":"75f724e8-30fe-40f7-83a3-e5adce7e9fdb","block_type":"box","text":"part, the cost of acquiring such a put option, the Fund may also sell a call option which, if exercised, requires it to","page_number":54,"box":{"x":70,"y":763,"width":813,"height":11}},{"id":"33fce99b-dce9-4796-8771-a69e40a189f7","block_type":"box","text":"sell a specified amount of yen for dollars at a specified price by a future date (a technique called a “straddle”). By","page_number":54,"box":{"x":69,"y":778,"width":813,"height":11}},{"id":"3536ebd5-657c-4d51-8811-05ecada3b6bb","block_type":"box","text":"selling such a call option in this illustration, the Fund gives up the opportunity to profit without limit from increases in","page_number":54,"box":{"x":69,"y":793,"width":835,"height":11}},{"id":"6d3e0d50-3c21-46d2-8c34-9929551cb6c8","block_type":"box","text":"the relative value of the yen to the dollar. “Straddles” of the type that may be used by a Fund are considered hedging","page_number":54,"box":{"x":68,"y":808,"width":836,"height":11}},{"id":"b6b1dee6-bad4-4e34-b777-922a180d87fb","block_type":"box","text":"transactions. Certain Funds have a fundamental investment restriction that restricts currency option strategies.","page_number":54,"box":{"x":68,"y":823,"width":794,"height":12}},{"id":"94244a10-bbad-4c22-ae5e-aa3388c550e8","block_type":"box","text":"Hedging transactions involving Currency Instruments involve substantial risks, including correlation risk. A Fund’s","page_number":54,"box":{"x":102,"y":846,"width":805,"height":11}},{"id":"f51898a4-5136-4f08-a350-224c3984f8c6","block_type":"box","text":"use of Currency Instruments to effect hedging strategies is intended to reduce the volatility of the NAV of the Fund’s","page_number":54,"box":{"x":69,"y":861,"width":828,"height":11}},{"id":"b9493df2-f742-4987-ac6e-4651170b8ef0","block_type":"box","text":"shares; however, the use of such hedging strategies will not prevent the NAV of the Fund’s shares from fluctuating.","page_number":54,"box":{"x":69,"y":876,"width":819,"height":11}},{"id":"28ed0f4c-755c-431f-97c2-ad0f603696e1","block_type":"box","text":"Moreover, although Currency Instruments will be used with the intention of hedging against adverse currency","page_number":54,"box":{"x":70,"y":891,"width":773,"height":12}},{"id":"cdb0cd67-a930-432b-8f01-5fb041437369","block_type":"box","text":"movements, transactions in Currency Instruments involve the risk that anticipated currency movements will not be","page_number":54,"box":{"x":69,"y":906,"width":814,"height":12}},{"id":"a047b0d6-07e3-455e-88e6-fb884bd527ab","block_type":"box","text":"II-23","page_number":54,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"ce561c5f-169e-4b21-b3ec-5b6e7d165025","block_type":"box","text":"NM0926U-5977317-54/232","page_number":54,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"9dadc7aa-a917-40ad-ae97-ff34bf4ea4c6","block_type":"box","text":"accurately predicted and that the Fund’s hedging strategies will be ineffective. To the extent that a Fund hedges","page_number":55,"box":{"x":69,"y":45,"width":796,"height":11}},{"id":"7ba00e46-8d8b-4930-9094-5431c97da015","block_type":"box","text":"against anticipated currency movements that do not occur, the Fund may realize losses and decrease its total return.","page_number":55,"box":{"x":69,"y":60,"width":835,"height":11}},{"id":"1d4e129c-cf58-4954-a796-67382bfeaf7d","block_type":"box","text":"Furthermore, a Fund will only engage in hedging activities from time to time and may not be engaging in hedging","page_number":55,"box":{"x":70,"y":75,"width":798,"height":11}},{"id":"dc75802a-75f7-4ac6-8c50-69d75d06434c","block_type":"box","text":"activities when movements in currency exchange rates actually occur.","page_number":55,"box":{"x":69,"y":90,"width":493,"height":11}},{"id":"62234886-658b-44c2-80e8-f4fd38fd002d","block_type":"box","text":"In connection with its trading in forward foreign currency contracts, a Fund will contract with a foreign or","page_number":55,"box":{"x":102,"y":113,"width":738,"height":11}},{"id":"9d62efaf-85a3-413d-994c-564d5b2bca73","block_type":"box","text":"domestic bank, or foreign or domestic securities dealer, to make or take future delivery of a specified amount of a","page_number":55,"box":{"x":69,"y":128,"width":814,"height":11}},{"id":"48aeaa2e-af71-4000-8b40-d3a9d123609f","block_type":"box","text":"particular currency. There are no limitations on daily price moves in such forward contracts, and banks and dealers","page_number":55,"box":{"x":70,"y":143,"width":819,"height":11}},{"id":"0461b4d3-f211-4e48-9cae-37f2f0067acd","block_type":"box","text":"are not required to continue to make markets in such contracts. There have been periods during which certain banks","page_number":55,"box":{"x":69,"y":158,"width":834,"height":11}},{"id":"3f915389-cc70-423b-bc67-7edfd91ef727","block_type":"box","text":"or dealers have refused to quote prices for such forward contracts or have quoted prices with an unusually wide","page_number":55,"box":{"x":69,"y":173,"width":797,"height":11}},{"id":"b8152dbb-0077-40b7-9f94-592e108bba8c","block_type":"box","text":"spread between the price at which the bank or dealer is prepared to buy and that at which it is prepared to sell.","page_number":55,"box":{"x":69,"y":188,"width":794,"height":11}},{"id":"05e48f45-0f44-471b-be86-bfc6f29e472b","block_type":"box","text":"Governmental imposition of currency controls might limit any such forward contract trading. With respect to its trading","page_number":55,"box":{"x":69,"y":203,"width":841,"height":12}},{"id":"e4972eef-cbed-447f-982e-756d139ef5a4","block_type":"box","text":"of forward contracts, if any, a Fund will be subject to counterparty risk. Any such failure to perform by a counterparty","page_number":55,"box":{"x":69,"y":218,"width":831,"height":12}},{"id":"7cf7c653-6414-49c8-b599-bb022bc3aba1","block_type":"box","text":"would deprive the Fund of any profit potential or force the Fund to cover its commitments for resale, if any, at the","page_number":55,"box":{"x":68,"y":234,"width":805,"height":11}},{"id":"14fcf948-63f6-4302-9533-9b20c040868c","block_type":"box","text":"then market price and could result in a loss to the Fund.","page_number":55,"box":{"x":68,"y":249,"width":401,"height":11}},{"id":"20330d2a-cf05-4d73-b367-66d6f99d4aaa","block_type":"box","text":"It may not be possible for a Fund to hedge against currency exchange rate movements, even if correctly","page_number":55,"box":{"x":102,"y":271,"width":738,"height":12}},{"id":"f9884b56-058b-4395-8a0c-5c88fda8c304","block_type":"box","text":"anticipated, in the event that (i) the currency exchange rate movement is so generally anticipated that the Fund is not","page_number":55,"box":{"x":69,"y":287,"width":837,"height":11}},{"id":"aab713b7-83e3-422e-855c-677cd6aba835","block_type":"box","text":"able to enter into a hedging transaction at an effective price, or (ii) the currency exchange rate movement relates to a","page_number":55,"box":{"x":69,"y":302,"width":837,"height":11}},{"id":"a75ec725-cfaa-4931-9444-f1948f435f2c","block_type":"box","text":"market with respect to which Currency Instruments are not available and it is not possible to engage in effective","page_number":55,"box":{"x":69,"y":317,"width":800,"height":11}},{"id":"8d43dbcd-ad6c-4309-81e3-35d4cdba811e","block_type":"box","text":"foreign currency hedging. The cost to a Fund of engaging in foreign currency transactions varies with such factors as","page_number":55,"box":{"x":68,"y":332,"width":829,"height":11}},{"id":"3ff0c1c1-dab1-46dc-9261-dbf85d085712","block_type":"box","text":"the currencies involved, the length of the contract period and the market conditions then prevailing. Since","page_number":55,"box":{"x":68,"y":347,"width":753,"height":11}},{"id":"b223df28-32c7-4aba-b803-c2c0d94fb7b4","block_type":"box","text":"transactions in foreign currency exchange usually are conducted on a principal basis, no fees or commissions are","page_number":55,"box":{"x":68,"y":362,"width":811,"height":11}},{"id":"600ae3dc-2afb-402c-912a-65d00bb97efd","block_type":"box","text":"involved.","page_number":55,"box":{"x":70,"y":377,"width":59,"height":9}},{"id":"e4f5bf02-dd9d-4bca-ae23-b3bcced69252","block_type":"box","text":"A Fund will not hedge a currency in excess of the aggregate market value of the securities that it owns (including","page_number":55,"box":{"x":101,"y":400,"width":803,"height":11}},{"id":"4bc1f1f2-fe8b-4174-85dc-93f36da981d0","block_type":"box","text":"receivables for unsettled securities sales), or has committed to purchase or anticipates purchasing, which are","page_number":55,"box":{"x":69,"y":415,"width":785,"height":11}},{"id":"3620d793-2bb4-4624-afc4-c182d577e328","block_type":"box","text":"denominated in such currency.","page_number":55,"box":{"x":69,"y":430,"width":216,"height":11}},{"id":"f137b105-97cb-4637-a31e-691f8a9d7570","block_type":"box","text":"Spot Transactions and FX Forwards.","page_number":55,"box":{"x":102,"y":453,"width":254,"height":11}},{"id":"41ca2b56-5cdd-4692-a843-d9d63a1501f7","block_type":"box","text":"FX forwards are OTC contracts to purchase or sell a specified amount of a","page_number":55,"box":{"x":364,"y":453,"width":527,"height":11}},{"id":"c77caeec-1a99-4c86-87bc-af8057018070","block_type":"box","text":"specified currency or multinational currency unit at a specified price and specified future date. Spot foreign exchange","page_number":55,"box":{"x":69,"y":468,"width":834,"height":11}},{"id":"c8639607-bd43-4d4c-b4b0-163a111f05ed","block_type":"box","text":"transactions are similar but are settled in the current, or “spot”, market. A Fund will enter into foreign exchange","page_number":55,"box":{"x":68,"y":483,"width":798,"height":11}},{"id":"19ac78dd-42a6-4bd0-a826-8c58ace0ab7e","block_type":"box","text":"transactions for purposes of hedging either a specific transaction or a portfolio position, or, with respect to certain","page_number":55,"box":{"x":68,"y":498,"width":817,"height":11}},{"id":"96cac95f-3025-4da9-a5b4-c003c06e25aa","block_type":"box","text":"Funds, to seek to enhance returns. FX forwards involve substantial currency risk, credit risk and liquidity risk. A Fund","page_number":55,"box":{"x":70,"y":513,"width":830,"height":11}},{"id":"552c8d9b-120f-4226-ba87-c56a0c796441","block_type":"box","text":"may enter into a foreign exchange transaction for purposes of hedging a specific transaction by, for example,","page_number":55,"box":{"x":69,"y":528,"width":774,"height":12}},{"id":"c5d47519-de12-490c-8b2e-edfd06a27147","block_type":"box","text":"purchasing a currency needed to settle a security transaction or selling a currency in which the Fund has received or","page_number":55,"box":{"x":70,"y":544,"width":828,"height":11}},{"id":"78e39e3c-1a95-458e-8a53-55b7b8f488e9","block_type":"box","text":"anticipates receiving a dividend or distribution. A Fund may enter into a foreign exchange transaction for purposes of","page_number":55,"box":{"x":69,"y":559,"width":830,"height":11}},{"id":"dc23ccf5-2725-4791-8cbf-2f9c58c36da2","block_type":"box","text":"hedging a portfolio position by selling forward a currency in which a portfolio position of the Fund is denominated or","page_number":55,"box":{"x":69,"y":574,"width":826,"height":11}},{"id":"201a1288-68e8-4143-8a17-8e84f41d4bf2","block_type":"box","text":"by purchasing a currency in which the Fund anticipates acquiring a portfolio position in the near future. A Fund may","page_number":55,"box":{"x":69,"y":589,"width":819,"height":11}},{"id":"3fae85cb-56d1-47df-bead-4f1ba2a033d2","block_type":"box","text":"also hedge a currency by entering into a transaction in a Currency Instrument denominated in a currency other than","page_number":55,"box":{"x":69,"y":604,"width":822,"height":11}},{"id":"b6296085-948a-4f7f-b1a5-b8a818f3fb7c","block_type":"box","text":"the currency being hedged (a “cross-hedge”). A Fund will only enter into a cross-hedge if the Manager believes that","page_number":55,"box":{"x":68,"y":619,"width":819,"height":11}},{"id":"dc457649-6b83-44f8-a924-3ca82b9e6a3b","block_type":"box","text":"(i) there is a demonstrably high correlation between the currency in which the cross-hedge is denominated and the","page_number":55,"box":{"x":69,"y":634,"width":814,"height":12}},{"id":"e7c7ef6b-7800-45d3-a56a-bcaf89465547","block_type":"box","text":"currency being hedged, and (ii) executing a cross-hedge through the currency in which the cross-hedge is","page_number":55,"box":{"x":69,"y":650,"width":745,"height":11}},{"id":"5ba2e348-ce61-4921-a21b-a174e071f7ec","block_type":"box","text":"denominated will be significantly more cost-effective or provide substantially greater liquidity than executing a similar","page_number":55,"box":{"x":69,"y":664,"width":832,"height":12}},{"id":"eda2f331-ccc5-4da0-b11b-63a6f7c72408","block_type":"box","text":"hedging transaction by means of the currency being hedged.","page_number":55,"box":{"x":69,"y":680,"width":428,"height":11}},{"id":"f018fc9d-23d0-4d67-aeb6-69cd33e1bf2b","block_type":"box","text":"A Fund may also engage in proxy hedging transactions to reduce the effect of currency fluctuations on the value","page_number":55,"box":{"x":101,"y":702,"width":797,"height":12}},{"id":"29a8f116-2549-4ce9-839f-0db69c1a3235","block_type":"box","text":"of existing or anticipated holdings of portfolio securities. Proxy hedging is often used when the currency to which the","page_number":55,"box":{"x":69,"y":717,"width":829,"height":12}},{"id":"1c65af29-dccf-411f-8d98-7e8b71d0520c","block_type":"box","text":"Fund is exposed is difficult to hedge, or to hedge against the U.S. dollar. Proxy hedging entails entering into a forward","page_number":55,"box":{"x":70,"y":732,"width":838,"height":12}},{"id":"e103a35b-3369-4f76-bbc5-c243ec94dabe","block_type":"box","text":"contract to sell a currency whose changes in value are generally considered to be linked to a currency or currencies","page_number":55,"box":{"x":69,"y":748,"width":823,"height":11}},{"id":"97e5c399-3b62-4f15-afea-54bfe6a1eafb","block_type":"box","text":"in which some or all of the Fund’s securities are, or are expected to be, denominated, and to buy U.S. dollars. Proxy","page_number":55,"box":{"x":70,"y":763,"width":827,"height":11}},{"id":"7f14e13f-6860-48d2-97d4-91f73c857f91","block_type":"box","text":"hedging involves some of the same risks and considerations as other transactions with similar instruments. Currency","page_number":55,"box":{"x":69,"y":778,"width":838,"height":11}},{"id":"b430db57-e597-4f30-ba24-63d939e0ca6d","block_type":"box","text":"transactions can result in losses to the Fund if the currency being hedged fluctuates in value to a degree or in a","page_number":55,"box":{"x":68,"y":793,"width":798,"height":11}},{"id":"ca9a0dbe-6bc8-49a0-8c13-b9edb507f479","block_type":"box","text":"direction that is not anticipated. In addition, there is the risk that the perceived linkage between various currencies","page_number":55,"box":{"x":69,"y":808,"width":819,"height":11}},{"id":"2375f277-78f9-41ed-9b8e-22ab017fb9a1","block_type":"box","text":"may not be present, including during the particular time that a Fund is engaging in proxy hedging.","page_number":55,"box":{"x":69,"y":823,"width":691,"height":12}},{"id":"7ebc5f17-3c56-4ae6-9c9f-ce2650b6871e","block_type":"box","text":"A Fund may also cross-hedge currencies by entering into forward contracts to sell one or more currencies that","page_number":55,"box":{"x":101,"y":846,"width":785,"height":11}},{"id":"22de8d91-328f-4f27-afe3-f8c440628cd1","block_type":"box","text":"are expected to decline in value relative to other currencies to which the Fund has or in which the Fund expects to","page_number":55,"box":{"x":69,"y":861,"width":811,"height":11}},{"id":"3663d503-9b3a-48c6-b7b4-32680be30455","block_type":"box","text":"have portfolio exposure. For example, a Fund may hold both Canadian government bonds and Japanese government","page_number":55,"box":{"x":69,"y":876,"width":828,"height":11}},{"id":"5d736d9a-a7e0-49c2-8f18-759f0212242b","block_type":"box","text":"bonds, and the Manager or sub-adviser may believe that Canadian dollars will deteriorate against Japanese yen. The","page_number":55,"box":{"x":69,"y":891,"width":829,"height":12}},{"id":"0bf63595-ebca-4c09-a3d4-3a3a431262b7","block_type":"box","text":"Fund would sell Canadian dollars to reduce its exposure to that currency and buy Japanese yen. This strategy would","page_number":55,"box":{"x":70,"y":906,"width":823,"height":12}},{"id":"738a42de-d994-496e-94c7-ac659820440e","block_type":"box","text":"II-24","page_number":55,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"d8fa9355-40ab-4a6e-8635-dbe213bf4893","block_type":"box","text":"NM0926U-5977317-55/232","page_number":55,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"8f7c6d37-9319-4da5-aa3d-c82820ed2145","block_type":"box","text":"be a hedge against a decline in the value of Canadian dollars, although it would expose the Fund to declines in the","page_number":56,"box":{"x":69,"y":45,"width":818,"height":11}},{"id":"d866e746-e8ee-4109-a914-df9a18d896fd","block_type":"box","text":"value of the Japanese yen relative to the U.S. dollar.","page_number":56,"box":{"x":68,"y":60,"width":372,"height":11}},{"id":"fdd258a1-65ec-42dc-8d97-91d1ccb89c09","block_type":"box","text":"Some of the forward non-U.S. currency contracts entered into by the Funds are classified as non-deliverable","page_number":56,"box":{"x":102,"y":82,"width":768,"height":12}},{"id":"729ae028-10cd-4a6b-b5b0-2e380828cff5","block_type":"box","text":"forwards (“NDFs”). NDFs are cash-settled, short-term forward contracts that may be thinly traded or are denominated","page_number":56,"box":{"x":68,"y":98,"width":838,"height":11}},{"id":"8648136c-fc2d-40d5-b9db-03847cd7f90b","block_type":"box","text":"in non-convertible foreign currency, where the profit or loss at the time at the settlement date is calculated by taking","page_number":56,"box":{"x":70,"y":113,"width":829,"height":11}},{"id":"fcd1bedf-b673-4b4b-87f8-62d4d0a1c514","block_type":"box","text":"the difference between the agreed upon exchange rate and the spot rate at the time of settlement, for an agreed","page_number":56,"box":{"x":68,"y":128,"width":806,"height":11}},{"id":"2770e383-8c58-48db-b6bf-31ee27f966a7","block_type":"box","text":"upon notional amount of funds. All NDFs have a fixing date and a settlement date. The fixing date is the date at which","page_number":56,"box":{"x":69,"y":143,"width":839,"height":11}},{"id":"4b6c8a1c-390f-437a-9540-23094518404e","block_type":"box","text":"the difference between the prevailing market exchange rate and the agreed upon exchange rate is calculated. The","page_number":56,"box":{"x":68,"y":158,"width":812,"height":11}},{"id":"eea2b9c3-4884-4160-9a29-85062f81b486","block_type":"box","text":"settlement date is the date by which the payment of the difference is due to the party receiving payment. NDFs are","page_number":56,"box":{"x":69,"y":173,"width":821,"height":11}},{"id":"0de8e30f-6f32-4998-9f08-8de4cda46dfe","block_type":"box","text":"commonly quoted for time periods of one month up to two years, and are normally quoted and settled in U.S. dollars.","page_number":56,"box":{"x":69,"y":188,"width":835,"height":11}},{"id":"0f4b2526-233b-491d-b389-95ba2d8f6c31","block_type":"box","text":"They are often used to gain exposure to and/or hedge exposure to foreign currencies that are not internationally","page_number":56,"box":{"x":68,"y":203,"width":802,"height":12}},{"id":"19d3e75c-ee2c-4c71-88d3-181bd6eb9ca7","block_type":"box","text":"traded.","page_number":56,"box":{"x":68,"y":219,"width":49,"height":8}},{"id":"20734bf7-6bc0-460a-9728-f216886d28d3","block_type":"box","text":"Currency Futures.","page_number":56,"box":{"x":102,"y":241,"width":123,"height":11}},{"id":"65c9b437-bcf9-416d-af0c-26e659873f10","block_type":"box","text":"A Fund may seek to enhance returns or hedge against the decline in the value of a currency","page_number":56,"box":{"x":232,"y":241,"width":654,"height":11}},{"id":"ac7e2e4a-ecdd-4723-a04d-eac47a299909","block_type":"box","text":"through use of currency futures or options on currency futures. Currency futures are similar to forward foreign","page_number":56,"box":{"x":68,"y":256,"width":782,"height":12}},{"id":"8dabc86d-57a9-4e0a-ab02-aa4b224eec80","block_type":"box","text":"exchange transactions except that futures are standardized, exchange-traded contracts while forward foreign","page_number":56,"box":{"x":69,"y":271,"width":774,"height":12}},{"id":"2c67cefe-1d82-4ee1-97e1-3563d0781a77","block_type":"box","text":"exchange transactions are traded in the OTC market. Currency futures involve substantial currency risk as well as the","page_number":56,"box":{"x":69,"y":286,"width":836,"height":12}},{"id":"79f9ded9-76eb-46be-a672-f6dd7ec9e0ef","block_type":"box","text":"risks discussed above in “—Futures.”","page_number":56,"box":{"x":69,"y":302,"width":269,"height":9}},{"id":"72a2a8fe-b836-43b9-b7d2-22db5f5f0875","block_type":"box","text":"Currency Options.","page_number":56,"box":{"x":102,"y":324,"width":125,"height":11}},{"id":"66f52d5e-1460-482b-ac49-ca9e24d4d1cb","block_type":"box","text":"A Fund may seek to enhance returns or hedge against the decline in the value of a currency","page_number":56,"box":{"x":233,"y":324,"width":654,"height":12}},{"id":"f7619a99-9469-4446-b869-bd5450094a56","block_type":"box","text":"through the use of currency options. Certain Funds have fundamental investment restrictions that permit the","page_number":56,"box":{"x":68,"y":339,"width":776,"height":12}},{"id":"81865cb6-1109-4059-87d0-77c669bdc349","block_type":"box","text":"purchase of currency options, but prohibit the writing of currency options. Currency options are similar to options on","page_number":56,"box":{"x":70,"y":355,"width":825,"height":11}},{"id":"fccac9c1-85f2-4e26-8cca-c8a8a4fbf211","block_type":"box","text":"securities. For example, in consideration for an option premium the writer of a currency option is obligated to sell (in","page_number":56,"box":{"x":69,"y":370,"width":827,"height":11}},{"id":"968dd54d-0d14-4884-b0d7-42cedf62d508","block_type":"box","text":"the case of a call option) or purchase (in the case of a put option) a specified amount of a specified currency on or","page_number":56,"box":{"x":68,"y":385,"width":820,"height":11}},{"id":"b938d7b5-b81c-4c65-aaaf-1b1959fb83ba","block_type":"box","text":"before the expiration date for a specified amount of another currency. A Fund may engage in transactions in options","page_number":56,"box":{"x":69,"y":400,"width":824,"height":11}},{"id":"cd154d8f-ecf6-45f5-b3c9-e376e973f7ef","block_type":"box","text":"on currencies either on exchanges or OTC markets. Such transactions in options may include exotic options on","page_number":56,"box":{"x":69,"y":415,"width":790,"height":11}},{"id":"659350e9-4523-48bd-856f-584a040e2841","block_type":"box","text":"currencies, which are typically traded in OTC markets and have additional features that result in different payment","page_number":56,"box":{"x":69,"y":430,"width":813,"height":11}},{"id":"8c3e25c8-4ead-441d-a628-0867b1a5212d","block_type":"box","text":"structures and/or expirations. Where a Fund is permitted to write currency options, it may write covered call options","page_number":56,"box":{"x":69,"y":446,"width":826,"height":10}},{"id":"00c94f80-2cf3-4675-ab6f-6d49243e4cab","block_type":"box","text":"on up to 100% of the currencies in its portfolio. See “—Options” above. Currency options involve substantial","page_number":56,"box":{"x":69,"y":460,"width":776,"height":12}},{"id":"3bfd5618-3d1d-4d33-814f-bacb456675fc","block_type":"box","text":"currency risk, and may also involve credit, leverage or illiquidity risk.","page_number":56,"box":{"x":69,"y":476,"width":483,"height":11}},{"id":"c40c33d5-937a-43ae-969e-03d91980f6f6","block_type":"box","text":"Currency Swaps.","page_number":56,"box":{"x":102,"y":498,"width":117,"height":11}},{"id":"9aa55d47-39c5-4923-a76c-e046fb4fb5f8","block_type":"box","text":"A Fund may enter into currency swaps in order to protect against currency fluctuations or to","page_number":56,"box":{"x":225,"y":498,"width":652,"height":11}},{"id":"0359133c-5e94-4c35-92ea-636582925379","block_type":"box","text":"hedge portfolio positions. Currency swaps are transactions in which one currency is simultaneously bought for a","page_number":56,"box":{"x":69,"y":513,"width":799,"height":12}},{"id":"7a7d0bf5-38ac-4838-92c0-ce7aed66f9b1","block_type":"box","text":"second currency on a spot basis and sold for the second currency on a forward basis. Currency swaps involve the","page_number":56,"box":{"x":69,"y":528,"width":812,"height":12}},{"id":"3e027423-a977-4f70-8f13-596c044a5d6c","block_type":"box","text":"exchange of the rights of a Fund and another party to make or receive payments in specified currencies, and typically","page_number":56,"box":{"x":69,"y":543,"width":836,"height":12}},{"id":"e326e904-5348-44c0-a1b9-16c87a81c671","block_type":"box","text":"require the delivery of the entire principal value of one designated currency in exchange for the other designated","page_number":56,"box":{"x":69,"y":559,"width":800,"height":11}},{"id":"d2949480-e5ee-4dff-84b3-c27a51c09f19","block_type":"box","text":"currency. As a result, the entire principal value of a currency swap is subject to the risk that the other party to the","page_number":56,"box":{"x":69,"y":574,"width":810,"height":11}},{"id":"4ea848de-ea9e-4691-aec4-6d58876d81df","block_type":"box","text":"swap will default on its contractual delivery obligations.","page_number":56,"box":{"x":69,"y":589,"width":393,"height":11}},{"id":"f74029f2-abe6-4051-b5bc-e465ece678de","block_type":"box","text":"Distressed Securities.","page_number":56,"box":{"x":102,"y":612,"width":159,"height":9}},{"id":"a97f8a14-7a12-4c26-99d3-57196e432668","block_type":"box","text":"A Fund may invest in securities, including loans purchased in the secondary market, that","page_number":56,"box":{"x":267,"y":612,"width":633,"height":11}},{"id":"69affa4a-3fe8-432a-8441-21d7f449ae0c","block_type":"box","text":"are the subject of bankruptcy proceedings or otherwise in default or in risk of being in default as to the repayment of","page_number":56,"box":{"x":69,"y":627,"width":834,"height":11}},{"id":"9e384881-1c11-408f-bdc4-6efd1dd9654e","block_type":"box","text":"principal and/or interest at the time of acquisition by the Fund or that are rated in the lower rating categories by one","page_number":56,"box":{"x":70,"y":642,"width":827,"height":11}},{"id":"5a6335be-03ea-495a-9a0c-dfbe6aa6522e","block_type":"box","text":"or more nationally recognized statistical rating organizations (for example, Ca or lower by Moody’s and CC or lower by","page_number":56,"box":{"x":69,"y":657,"width":835,"height":11}},{"id":"4681a503-175b-4db7-965f-814815e74928","block_type":"box","text":"S&P or Fitch) or, if unrated, are in the judgment of the Manager of equivalent quality (“Distressed Securities”).","page_number":56,"box":{"x":69,"y":672,"width":784,"height":11}},{"id":"8aa449fe-4dcc-43c2-810e-91ac534dfba5","block_type":"box","text":"Investment in Distressed Securities is speculative and involves significant risks.","page_number":56,"box":{"x":70,"y":687,"width":569,"height":11}},{"id":"ec315a91-760f-417f-86d6-f55debda0580","block_type":"box","text":"A Fund will generally make such investments only when the Manager believes it is reasonably likely that the","page_number":56,"box":{"x":101,"y":710,"width":766,"height":11}},{"id":"fd053728-0594-4615-b101-b0d02ce770f6","block_type":"box","text":"issuer of the Distressed Securities will make an exchange offer or will be the subject of a plan of reorganization","page_number":56,"box":{"x":70,"y":725,"width":795,"height":11}},{"id":"c65ebf60-33f3-4eef-96f3-c8b2f9e8dfa9","block_type":"box","text":"pursuant to which the Fund will receive new securities in return for the Distressed Securities. However, there can be","page_number":56,"box":{"x":70,"y":740,"width":826,"height":11}},{"id":"853b31f6-6335-4541-8944-36477d46cd0b","block_type":"box","text":"no assurance that such an exchange offer will be made or that such a plan of reorganization will be adopted. In","page_number":56,"box":{"x":69,"y":755,"width":794,"height":11}},{"id":"4d096070-5c3e-4ae2-96bd-1e84ebfce1b0","block_type":"box","text":"addition, a significant period of time may pass between the time at which a Fund makes its investment in Distressed","page_number":56,"box":{"x":69,"y":770,"width":832,"height":12}},{"id":"e90922be-9f9b-4bcf-aba2-c82b824a0f52","block_type":"box","text":"Securities and the time that any such exchange offer or plan of reorganization is completed. During this period, it is","page_number":56,"box":{"x":69,"y":785,"width":824,"height":12}},{"id":"864dfdbd-7d62-4ae4-96ce-6187737c9493","block_type":"box","text":"unlikely that a Fund will receive any interest payments on the Distressed Securities, the Fund will be subject to","page_number":56,"box":{"x":69,"y":801,"width":789,"height":11}},{"id":"5f347044-0780-4de3-aa7f-451b7190abd6","block_type":"box","text":"significant uncertainty as to whether or not the exchange offer or plan of reorganization will be completed and the","page_number":56,"box":{"x":69,"y":816,"width":810,"height":11}},{"id":"4bbc29d4-5bb3-4c7f-a841-ebc8c717a068","block_type":"box","text":"Fund may be required to bear certain extraordinary expenses to protect and recover its investment. Therefore, to the","page_number":56,"box":{"x":70,"y":831,"width":831,"height":11}},{"id":"ec16a4cc-e009-4243-b1c3-d0b25407b349","block_type":"box","text":"extent the Fund seeks capital appreciation through investment in distressed securities, the Fund’s ability to achieve","page_number":56,"box":{"x":69,"y":846,"width":826,"height":11}},{"id":"be09caf0-f8e9-4630-9b03-3468664af020","block_type":"box","text":"current income for its shareholders may be diminished. The Fund also will be subject to significant uncertainty as to","page_number":56,"box":{"x":69,"y":861,"width":827,"height":11}},{"id":"a7c99fe5-8ab2-445b-a726-d3024958258d","block_type":"box","text":"when and in what manner and for what value the obligations evidenced by the distressed securities will eventually be","page_number":56,"box":{"x":68,"y":876,"width":834,"height":11}},{"id":"1442d55c-783a-497a-9ad5-8c41a66273e0","block_type":"box","text":"satisfied (","page_number":56,"box":{"x":69,"y":891,"width":70,"height":11}},{"id":"5932a31d-220e-4e8a-a138-6e8a3e13c2d2","block_type":"box","text":"e.g.","page_number":56,"box":{"x":140,"y":893,"width":25,"height":10}},{"id":"a19a91f1-59b3-4413-bcee-6044129d33b1","block_type":"box","text":", through a liquidation of the obligor’s assets, an exchange offer or plan of reorganization involving the","page_number":56,"box":{"x":168,"y":891,"width":729,"height":12}},{"id":"5e70089f-dda1-4c62-ad50-4cd6af6c31ab","block_type":"box","text":"distressed securities or a payment of some amount in satisfaction of the obligation). Even if an exchange offer is","page_number":56,"box":{"x":69,"y":906,"width":807,"height":12}},{"id":"20f639bc-8ba4-4035-aaaa-3f2b7444d968","block_type":"box","text":"II-25","page_number":56,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"b496fad4-6433-48d2-8991-78db44c135db","block_type":"box","text":"NM0926U-5977317-56/232","page_number":56,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"5d804dad-551e-4ce5-8ab9-6ed30f7e3aeb","block_type":"box","text":"made or plan of reorganization is adopted with respect to Distressed Securities held by a Fund, there can be no","page_number":57,"box":{"x":69,"y":45,"width":797,"height":11}},{"id":"fa32906b-f047-4b30-9070-cbcca2836a1d","block_type":"box","text":"assurance that the securities or other assets received by a Fund in connection with such exchange offer or plan of","page_number":57,"box":{"x":69,"y":60,"width":816,"height":11}},{"id":"c6c6e1a6-2342-4c7b-a5bd-f604f03726c2","block_type":"box","text":"reorganization will not have a lower value or income potential than may have been anticipated when the investment","page_number":57,"box":{"x":69,"y":75,"width":821,"height":11}},{"id":"4d9fd04b-bc72-494a-a916-a826189819ab","block_type":"box","text":"was made or no value. Moreover, any securities received by a Fund upon completion of an exchange offer or plan of","page_number":57,"box":{"x":68,"y":90,"width":827,"height":11}},{"id":"48e490b8-5d4c-4a6e-8b92-0466611af029","block_type":"box","text":"reorganization may be restricted as to resale. Similarly, if a Fund participates in negotiations with respect to any","page_number":57,"box":{"x":69,"y":105,"width":800,"height":11}},{"id":"06601237-13ad-457c-9344-c75fce4117bf","block_type":"box","text":"exchange offer or plan of reorganization with respect to an issuer of Distressed Securities, the Fund may be","page_number":57,"box":{"x":69,"y":120,"width":770,"height":12}},{"id":"f6ba396f-05dd-43bb-8b7d-2165c7ff217b","block_type":"box","text":"restricted from disposing of such securities. To the extent that a Fund becomes involved in such proceedings, the","page_number":57,"box":{"x":69,"y":135,"width":809,"height":12}},{"id":"f23e6299-1768-4d69-84b8-1d82f60cf11b","block_type":"box","text":"Fund may have a more active participation in the affairs of the issuer than that assumed generally by an investor. The","page_number":57,"box":{"x":70,"y":150,"width":839,"height":12}},{"id":"cdb7b88d-ece1-41dd-bc73-5578447a845e","block_type":"box","text":"Fund, however, will not make investments for the purpose of exercising day-to-day management of any issuer’s","page_number":57,"box":{"x":70,"y":166,"width":787,"height":11}},{"id":"916a9503-1b92-4aa9-a128-9b85464de6c8","block_type":"box","text":"affairs.","page_number":57,"box":{"x":69,"y":181,"width":49,"height":9}},{"id":"e6754077-b369-467b-9705-621e81f81fc3","block_type":"box","text":"Environmental, Social and Governance (“ESG”) Integration","page_number":57,"box":{"x":102,"y":203,"width":428,"height":11}},{"id":"05a7d558-6c5b-4c9a-b4b4-17022a9bfded","block_type":"box","text":". Although a Fund does not seek to implement a","page_number":57,"box":{"x":531,"y":204,"width":341,"height":11}},{"id":"3d526359-82db-4e50-993e-5317cf6cc41b","block_type":"box","text":"specific sustainability objective, strategy or process unless disclosed in its Prospectus, Fund management will","page_number":57,"box":{"x":69,"y":218,"width":785,"height":12}},{"id":"4889239f-6cd3-48b7-b66c-8fdbc347e0b4","block_type":"box","text":"consider ESG factors as part of the investment process for the Fund. Fund management views ESG integration as the","page_number":57,"box":{"x":69,"y":234,"width":838,"height":11}},{"id":"dc0ab663-de54-440c-b665-93a727dd950c","block_type":"box","text":"practice of incorporating financially material ESG data or information into investment processes with the objective of","page_number":57,"box":{"x":70,"y":249,"width":827,"height":11}},{"id":"a3de867a-d303-4e7e-bab9-ad9b83f4f675","block_type":"box","text":"enhancing risk-adjusted returns. These ESG considerations will vary depending on a Fund’s particular investment","page_number":57,"box":{"x":69,"y":264,"width":806,"height":11}},{"id":"207212bf-c783-4ad3-933c-959d5d19c152","block_type":"box","text":"strategies and may include consideration of third-party research as well as consideration of proprietary BlackRock","page_number":57,"box":{"x":69,"y":279,"width":812,"height":11}},{"id":"1b7f638c-5c8e-47b6-94e3-605e23b51a1a","block_type":"box","text":"research across the ESG risks and opportunities regarding an issuer. The ESG characteristics utilized in a Fund’s","page_number":57,"box":{"x":69,"y":294,"width":807,"height":11}},{"id":"575f11e5-2c49-4bdb-9c49-7a61efcc64f2","block_type":"box","text":"investment process are anticipated to evolve over time and one or more characteristics may not be relevant with","page_number":57,"box":{"x":70,"y":309,"width":800,"height":11}},{"id":"f97ba108-37e8-47cd-b0ba-a7dcb79e874f","block_type":"box","text":"respect to all issuers that are eligible for investment.","page_number":57,"box":{"x":69,"y":324,"width":377,"height":12}},{"id":"6a5f319b-b780-42bc-9a3b-7c6a2ca5810e","block_type":"box","text":"Certain of these considerations may affect a Fund’s exposure to certain companies or industries. While Fund","page_number":57,"box":{"x":102,"y":347,"width":778,"height":11}},{"id":"e17feb7c-4b77-49bc-ad3f-a6773ad5f06b","block_type":"box","text":"management views ESG considerations as having the potential to contribute to a Fund’s long-term performance,","page_number":57,"box":{"x":69,"y":362,"width":800,"height":11}},{"id":"db67a54d-f49d-441d-8c71-74f2309c7cf7","block_type":"box","text":"there is no guarantee that such results will be achieved.","page_number":57,"box":{"x":68,"y":377,"width":400,"height":12}},{"id":"2f40f11e-ed98-4470-9f1b-ed532b864813","block_type":"box","text":"Equity Securities.","page_number":57,"box":{"x":102,"y":400,"width":127,"height":11}},{"id":"d9477f6e-f0bf-4575-b64c-71daf6573c91","block_type":"box","text":"Certain Funds may invest in equity securities, which include common stock and, for certain","page_number":57,"box":{"x":235,"y":400,"width":648,"height":11}},{"id":"cf807155-04d0-419d-8696-e3f7ff63caf0","block_type":"box","text":"Funds, preferred stock (including convertible preferred stock); bonds, stock purchase warrants and rights; equity","page_number":57,"box":{"x":70,"y":415,"width":802,"height":11}},{"id":"fd1556c7-155d-4f8b-9bb9-1b6b7a880c3f","block_type":"box","text":"interests in trusts; general and limited partnerships and limited liability companies; and depositary receipts. Stock","page_number":57,"box":{"x":70,"y":430,"width":817,"height":11}},{"id":"8124f7ea-cd68-4abb-a237-0e6db419abf3","block_type":"box","text":"markets are volatile. The price of equity securities will fluctuate and can decline and reduce the value of a portfolio","page_number":57,"box":{"x":69,"y":445,"width":819,"height":11}},{"id":"cef6b747-acff-49d7-bf1d-42c95d5677d2","block_type":"box","text":"investing in equities. The price of equity securities fluctuates based on changes in a company’s financial condition","page_number":57,"box":{"x":70,"y":460,"width":813,"height":12}},{"id":"295c7d8d-2fc5-4662-92ef-d21d4aa5721b","block_type":"box","text":"and overall market and economic conditions. The value of equity securities purchased by the Fund could decline if the","page_number":57,"box":{"x":69,"y":475,"width":839,"height":12}},{"id":"3c6698b9-ac3b-452b-9e05-e7cfe5302fcb","block_type":"box","text":"financial condition of the companies the Fund invests in decline or if overall market and economic conditions","page_number":57,"box":{"x":68,"y":491,"width":775,"height":11}},{"id":"6fea1d5c-ad2d-4d78-809b-315e8cab8734","block_type":"box","text":"deteriorate. They may also decline due to factors that affect a particular industry or industries, such as labor","page_number":57,"box":{"x":69,"y":506,"width":777,"height":11}},{"id":"e1357b6c-7508-4cb2-b5da-15246874766a","block_type":"box","text":"shortages or increase in production costs and competitive conditions within an industry. In addition, they may decline","page_number":57,"box":{"x":69,"y":521,"width":837,"height":11}},{"id":"4a4c6cd0-2cd2-458f-9fc6-5ad2e20fe537","block_type":"box","text":"due to general market conditions that are not specifically related to a company or industry, such as real or perceived","page_number":57,"box":{"x":69,"y":536,"width":831,"height":11}},{"id":"1f78ffcb-ace9-403f-8012-82fa49e4d843","block_type":"box","text":"adverse economic conditions, changes in the general outlook for corporate earnings, changes in interest or currency","page_number":57,"box":{"x":69,"y":551,"width":829,"height":11}},{"id":"22f997e9-80d8-4f98-83ab-ecad8ce63587","block_type":"box","text":"rates or generally adverse investor sentiment.","page_number":57,"box":{"x":69,"y":566,"width":325,"height":11}},{"id":"a2713629-303e-4b37-929a-1336731f38b2","block_type":"box","text":"From time to time certain of the Funds may invest in shares of companies through initial public offerings","page_number":57,"box":{"x":102,"y":589,"width":745,"height":11}},{"id":"e03666a6-cf57-479f-96dd-7cd904afb277","block_type":"box","text":"(“IPOs”). IPOs have the potential to produce, and have in fact produced, substantial gains for certain Funds. There is","page_number":57,"box":{"x":69,"y":604,"width":833,"height":11}},{"id":"27b0b3b7-11db-41a3-a36f-8c8f77c7e0f0","block_type":"box","text":"no assurance that any Fund will have continued access to profitable IPOs and therefore investors should not rely on","page_number":57,"box":{"x":69,"y":619,"width":824,"height":11}},{"id":"3d66cf8f-33c9-4b7c-adf8-81f6c57f7897","block_type":"box","text":"these past gains as an indication of future performance. The investment performance of a Fund during periods when","page_number":57,"box":{"x":68,"y":634,"width":834,"height":12}},{"id":"d11d58da-38a1-4981-8280-8336c1a6d8ad","block_type":"box","text":"it is unable to invest significantly or at all in IPOs may be lower than during periods when it is able to do so. In","page_number":57,"box":{"x":70,"y":649,"width":782,"height":12}},{"id":"329418ee-6ee9-42a1-bda8-1b366a3f8747","block_type":"box","text":"addition, as a Fund increases in size, the impact of IPOs on its performance will generally decrease. Securities","page_number":57,"box":{"x":69,"y":664,"width":790,"height":12}},{"id":"22ba5bbb-9a7c-4fbe-89da-aa774b3770d0","block_type":"box","text":"issued in IPOs are subject to many of the same risks as investing in companies with smaller market capitalizations.","page_number":57,"box":{"x":70,"y":680,"width":823,"height":11}},{"id":"248aef17-d525-4b1d-960c-d76f0055bf01","block_type":"box","text":"Securities issued in IPOs have no trading history, and information about the companies may be available for very","page_number":57,"box":{"x":69,"y":695,"width":805,"height":11}},{"id":"f910cc2f-a404-4850-b72a-4ccaddac6a8c","block_type":"box","text":"limited periods. In addition, the prices of securities sold in IPOs may be highly volatile or may decline shortly after the","page_number":57,"box":{"x":70,"y":710,"width":836,"height":11}},{"id":"392c6577-1bc3-46cd-872f-263c7b4f60d3","block_type":"box","text":"initial public offering.","page_number":57,"box":{"x":70,"y":725,"width":147,"height":11}},{"id":"fc15eacc-5abd-4358-b560-2d76b5976c9c","block_type":"box","text":"The Funds may invest in companies that have relatively small market capitalizations. These organizations will","page_number":57,"box":{"x":101,"y":748,"width":777,"height":11}},{"id":"84dc1d19-22c5-4d8a-8783-dc222aa8fef3","block_type":"box","text":"normally have more limited product lines, markets and financial resources and will be dependent upon a more limited","page_number":57,"box":{"x":69,"y":763,"width":838,"height":11}},{"id":"7f1bb0c6-64f4-48eb-83c0-2d05fa34462e","block_type":"box","text":"management group than larger capitalized companies. In addition, it is more difficult to get information on smaller","page_number":57,"box":{"x":69,"y":778,"width":815,"height":11}},{"id":"e4aa669e-5d42-4efb-bba6-8f57733ae925","block_type":"box","text":"companies, which tend to be less well known, have shorter operating histories, do not have significant ownership by","page_number":57,"box":{"x":69,"y":793,"width":829,"height":11}},{"id":"809747c7-9cfd-4b03-af08-328147f4d92b","block_type":"box","text":"large investors and are followed by relatively few securities analysts. The securities of smaller capitalized companies","page_number":57,"box":{"x":70,"y":808,"width":831,"height":11}},{"id":"13eb4919-1ad0-433a-8bb5-674341adfcd0","block_type":"box","text":"are often traded in the OTC markets and may have fewer market makers and wider price spreads. This may result in","page_number":57,"box":{"x":69,"y":823,"width":826,"height":11}},{"id":"c61c2a79-69cc-4ea9-af95-fd5d077237b6","block_type":"box","text":"greater price movements and less ability to sell a Fund’s investment than if the Fund held the securities of larger,","page_number":57,"box":{"x":68,"y":838,"width":810,"height":12}},{"id":"4d4ce85b-ed5a-4c4b-b425-3f2e97433a3d","block_type":"box","text":"more established companies.","page_number":57,"box":{"x":69,"y":854,"width":209,"height":10}},{"id":"08f165d7-668c-44f1-b0b4-c7303411e270","block_type":"box","text":"II-26","page_number":57,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"7f46c04f-07e3-428b-859a-930a5a9c981f","block_type":"box","text":"NM0926U-5977317-57/232","page_number":57,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"45dec8bd-41c0-4b9e-aa83-70bf55b5c798","block_type":"box","text":"For a discussion of the types of equity securities in which your Fund may invest and the risks associated with","page_number":58,"box":{"x":102,"y":45,"width":776,"height":11}},{"id":"481cd12a-f850-4df3-8d08-7e6507303d0d","block_type":"box","text":"investing in such equity securities, see your Fund’s Prospectus. Certain of the Funds may also invest in shares of","page_number":58,"box":{"x":70,"y":60,"width":810,"height":11}},{"id":"e82b112c-554d-476f-966b-26e27ff58b6a","block_type":"box","text":"private companies, which are subject to the risks of “Illiquid Investments” and “Restricted Securities” described","page_number":58,"box":{"x":70,"y":75,"width":799,"height":11}},{"id":"9f3832a3-06f6-4715-9b5b-d7b5f08cb57a","block_type":"box","text":"below.","page_number":58,"box":{"x":69,"y":90,"width":43,"height":9}},{"id":"0d20082a-94fc-4c54-9a83-6199631990be","block_type":"box","text":"Real Estate-Related Securities.","page_number":58,"box":{"x":102,"y":113,"width":219,"height":9}},{"id":"77ac5bd8-c141-41c2-8956-b31f26489b2a","block_type":"box","text":"Although no Fund may invest directly in real estate, certain Funds may invest in","page_number":58,"box":{"x":327,"y":113,"width":565,"height":11}},{"id":"2ea386ef-b9d2-4cfe-8cfa-5ab1a74c7700","block_type":"box","text":"equity securities of issuers that are principally engaged in the real estate industry. Such investments are subject to","page_number":58,"box":{"x":69,"y":128,"width":822,"height":11}},{"id":"4979308c-2f2f-4448-9674-55e7226117fd","block_type":"box","text":"certain risks associated with the ownership of real estate and with the real estate industry in general. These risks","page_number":58,"box":{"x":69,"y":143,"width":814,"height":11}},{"id":"d4d4eed6-a42f-471c-a6a6-41a8a5663568","block_type":"box","text":"include, among others: possible declines in the value of real estate; risks related to general and local economic","page_number":58,"box":{"x":70,"y":158,"width":796,"height":11}},{"id":"30a1a7db-1c5e-41f4-8952-c54f107d54d5","block_type":"box","text":"conditions; possible lack of availability of mortgage funds or other limitations on access to capital; overbuilding; risks","page_number":58,"box":{"x":69,"y":173,"width":836,"height":11}},{"id":"76b239d2-43b3-48bb-ba04-3e3adcb42f2f","block_type":"box","text":"associated with leverage; market illiquidity; extended vacancies of properties; increase in competition, property","page_number":58,"box":{"x":69,"y":188,"width":795,"height":12}},{"id":"0eb84180-114f-4828-b2af-dc5df6a0a94d","block_type":"box","text":"taxes, capital expenditures and operating expenses; changes in zoning laws or other governmental regulation; costs","page_number":58,"box":{"x":68,"y":204,"width":828,"height":11}},{"id":"4f942ddb-bf22-454e-b346-2c59e9aa0e4e","block_type":"box","text":"resulting from the clean-up of, and liability to third parties for damages resulting from, environmental problems;","page_number":58,"box":{"x":69,"y":218,"width":794,"height":12}},{"id":"f15e1d61-ff97-4861-9581-a3f8acb03ae7","block_type":"box","text":"tenant bankruptcies or other credit problems; casualty or condemnation losses; uninsured damages from floods,","page_number":58,"box":{"x":68,"y":234,"width":805,"height":11}},{"id":"dd7c7541-34f7-44b1-b3fc-48d3a7796953","block_type":"box","text":"earthquakes or other natural disasters; limitations on and variations in rents, including decreases in market rates for","page_number":58,"box":{"x":69,"y":249,"width":836,"height":11}},{"id":"6f6f3e03-9225-4cc0-bb9d-b9e61e56e9f2","block_type":"box","text":"rents; investment in developments that are not completed or that are subject to delays in completion; and changes in","page_number":58,"box":{"x":69,"y":264,"width":838,"height":11}},{"id":"3d8dbf55-1a79-43bc-8080-7a3ff72e9abd","block_type":"box","text":"interest rates. To the extent that assets underlying a Fund’s investments are concentrated geographically, by property","page_number":58,"box":{"x":70,"y":279,"width":838,"height":11}},{"id":"98e27d64-9adc-48e1-ae98-c431242b439f","block_type":"box","text":"type or in certain other respects, the Fund may be subject to certain of the foregoing risks to a greater extent.","page_number":58,"box":{"x":68,"y":294,"width":785,"height":11}},{"id":"46a61fab-8ac9-43a8-805d-4a099c83bd28","block_type":"box","text":"Investments by a Fund in securities of companies providing mortgage servicing will be subject to the risks associated","page_number":58,"box":{"x":70,"y":309,"width":836,"height":11}},{"id":"cbf909e0-5e8e-40b6-af61-d710b232c652","block_type":"box","text":"with refinancings and their impact on servicing rights.","page_number":58,"box":{"x":68,"y":324,"width":381,"height":12}},{"id":"7f96eb3a-57c9-4144-9397-a7ea60c23315","block_type":"box","text":"In addition, if a Fund receives rental income or income from the disposition of real property acquired as a result","page_number":58,"box":{"x":102,"y":347,"width":797,"height":11}},{"id":"7c9123ee-2d43-4e97-93bb-53d8dc4583c1","block_type":"box","text":"of a default on securities the Fund owns, the receipt of such income may adversely affect the Fund’s ability to retain","page_number":58,"box":{"x":69,"y":362,"width":829,"height":11}},{"id":"c9ad1e6b-9c9b-4ccd-9af3-74b34e06d9ed","block_type":"box","text":"its tax status as a regulated investment company because of certain income source requirements applicable to","page_number":58,"box":{"x":70,"y":377,"width":794,"height":12}},{"id":"32d41044-6eb9-469c-ab4c-c30b002f87d3","block_type":"box","text":"regulated investment companies under the Internal Revenue Code of 1986, as amended (the “Code”).","page_number":58,"box":{"x":69,"y":392,"width":730,"height":12}},{"id":"7d5b8444-2716-4794-8e8e-62fe6bd3ab1f","block_type":"box","text":"Securities of Smaller or Emerging Growth Companies.","page_number":58,"box":{"x":102,"y":415,"width":381,"height":11}},{"id":"288ad728-aeb4-4a4c-b7dc-f2790ac58fae","block_type":"box","text":"Investment in smaller or emerging growth companies","page_number":58,"box":{"x":490,"y":415,"width":376,"height":11}},{"id":"c72b04e5-df95-4165-b569-6dc705ac13d8","block_type":"box","text":"involves greater risk than is customarily associated with investments in more established companies. The securities","page_number":58,"box":{"x":70,"y":430,"width":828,"height":11}},{"id":"a0d24dd1-4749-4978-90da-6f6eea5abd69","block_type":"box","text":"of smaller or emerging growth companies may be subject to more abrupt or erratic market movements than larger,","page_number":58,"box":{"x":69,"y":445,"width":815,"height":12}},{"id":"6fd6cf7c-e257-4a75-8fdf-cfeef5542404","block_type":"box","text":"more established companies or the market average in general. These companies may have limited product lines,","page_number":58,"box":{"x":69,"y":461,"width":804,"height":11}},{"id":"d8015a0e-b86e-4295-9fc4-5b37a1956a97","block_type":"box","text":"markets or financial resources, or they may be dependent on a limited management group.","page_number":58,"box":{"x":69,"y":475,"width":647,"height":12}},{"id":"59873743-7383-4783-9707-5577f36617c8","block_type":"box","text":"Investments in smaller or emerging growth companies may involve greater risks and thus may be considered","page_number":58,"box":{"x":102,"y":498,"width":773,"height":11}},{"id":"405bb3e6-cca5-49a9-bec2-e75656da1991","block_type":"box","text":"speculative. Full development of these companies and trends frequently takes time.","page_number":58,"box":{"x":69,"y":513,"width":597,"height":11}},{"id":"7876f278-e9ef-4208-b3ef-980d67345e16","block_type":"box","text":"Small cap and emerging growth securities will often be traded only in the OTC market or on a regional securities","page_number":58,"box":{"x":102,"y":536,"width":797,"height":11}},{"id":"9781d078-7b78-4d5c-bbdc-73b3b69166e7","block_type":"box","text":"exchange and may not be traded every day or in the volume typical of trading on a national securities exchange. As a","page_number":58,"box":{"x":69,"y":551,"width":832,"height":11}},{"id":"f9424635-027f-488e-9549-2d203c7de8fe","block_type":"box","text":"result, the disposition by a Fund of portfolio securities to meet redemptions or otherwise may require the Fund to","page_number":58,"box":{"x":69,"y":566,"width":808,"height":11}},{"id":"a8d38a2e-c259-401e-bde8-327f85642be2","block_type":"box","text":"make many small sales over a lengthy period of time, or to sell these securities at a discount from market prices or","page_number":58,"box":{"x":69,"y":581,"width":825,"height":12}},{"id":"0218913a-121e-410c-8e4f-9a29073e30b8","block_type":"box","text":"during periods when, in Fund management’s judgment, such disposition is not desirable.","page_number":58,"box":{"x":69,"y":597,"width":631,"height":11}},{"id":"0e550ab1-5a24-4acf-86d0-6030a1feb1e1","block_type":"box","text":"The process of selection and continuous supervision by Fund management does not guarantee successful","page_number":58,"box":{"x":101,"y":619,"width":758,"height":11}},{"id":"5dd6db70-1fd0-498b-94b0-5ad7d4775836","block_type":"box","text":"investment results. Careful initial selection is particularly important in this area as many new enterprises have","page_number":58,"box":{"x":70,"y":634,"width":787,"height":11}},{"id":"f2be4a65-fca4-4418-972c-20ce4dbdf3c1","block_type":"box","text":"promise but lack certain of the fundamental factors necessary to prosper. Investing in small cap and emerging","page_number":58,"box":{"x":70,"y":649,"width":789,"height":12}},{"id":"408bcb4a-f078-4ecd-bdc0-305f4e06ae0b","block_type":"box","text":"growth companies requires specialized research and analysis.","page_number":58,"box":{"x":68,"y":665,"width":442,"height":11}},{"id":"3cfb5111-a76c-494e-b991-26c6be85f04a","block_type":"box","text":"Fund management believes that relatively small companies may have the opportunity to develop into significant","page_number":58,"box":{"x":102,"y":687,"width":795,"height":11}},{"id":"b18b5a6d-8852-48b5-9a17-2691924ecbd4","block_type":"box","text":"business enterprises. A Fund may invest in securities of small issuers in the relatively early stages of business","page_number":58,"box":{"x":69,"y":702,"width":791,"height":12}},{"id":"4283be1d-02ad-466e-90ac-b5909e4c070c","block_type":"box","text":"development that have a new technology, a unique or proprietary product or service, or a favorable market position.","page_number":58,"box":{"x":69,"y":717,"width":823,"height":12}},{"id":"ab1337ad-d08b-4aa5-a27c-96c6420442cc","block_type":"box","text":"Equity securities of specific small cap issuers may present different opportunities for long-term capital","page_number":58,"box":{"x":102,"y":740,"width":729,"height":11}},{"id":"ac743c9e-0492-4d93-90df-386d295dc6df","block_type":"box","text":"appreciation during varying portions of economic or securities market cycles, as well as during varying stages of their","page_number":58,"box":{"x":69,"y":755,"width":837,"height":11}},{"id":"7047f68d-cdbb-4ae6-ad22-58eae25c4888","block_type":"box","text":"business development. The market valuation of small cap issuers tends to fluctuate during economic or market","page_number":58,"box":{"x":69,"y":770,"width":794,"height":12}},{"id":"7d790111-76ba-4f22-b9d0-0d0fae91a444","block_type":"box","text":"cycles.","page_number":58,"box":{"x":69,"y":786,"width":46,"height":11}},{"id":"a9ca5a5a-aca9-4482-90ed-c1f344d90e5f","block_type":"box","text":"Tracking Stocks","page_number":58,"box":{"x":103,"y":808,"width":110,"height":11}},{"id":"649af173-d639-4fdb-9f7d-376556f0e7d1","block_type":"box","text":". A tracking stock is a separate class of common stock whose value is linked to a specific","page_number":58,"box":{"x":214,"y":808,"width":640,"height":11}},{"id":"9fd6e6f0-870e-410d-b2b3-eb5881fbdf50","block_type":"box","text":"business unit or operating division within a larger company and is designed to “track” the performance of such","page_number":58,"box":{"x":69,"y":823,"width":791,"height":12}},{"id":"9cd781d4-10a5-4f20-b340-866df0b2f250","block_type":"box","text":"business unit or division. The tracking stock may pay dividends to shareholders independent of the parent company.","page_number":58,"box":{"x":69,"y":838,"width":826,"height":12}},{"id":"c48347fa-37e0-4883-aeaf-bda6cd3c0e70","block_type":"box","text":"The parent company, rather than the business unit or division, generally is the issuer of tracking stock. However,","page_number":58,"box":{"x":68,"y":853,"width":801,"height":12}},{"id":"c3cb59e7-9d8f-458b-b71a-e3801960ac6c","block_type":"box","text":"holders of the tracking stock may not have the same rights as holders of the company’s common stock.","page_number":58,"box":{"x":69,"y":869,"width":740,"height":11}},{"id":"6cd1252f-9068-453b-b243-e3ccfc99822f","block_type":"box","text":"Exchange-Traded Notes (“ETNs”).","page_number":58,"box":{"x":102,"y":891,"width":245,"height":11}},{"id":"a8f93686-6ee0-47d2-a287-4f8442b2222b","block_type":"box","text":"Certain Funds may invest in ETNs. ETNs are generally notes representing","page_number":58,"box":{"x":354,"y":891,"width":521,"height":12}},{"id":"11c18679-45c0-4e91-a30f-6cc5916efd5d","block_type":"box","text":"debt of the issuer, usually a financial institution. ETNs combine aspects of both bonds and ETFs. An ETN’s returns","page_number":58,"box":{"x":69,"y":906,"width":814,"height":12}},{"id":"e7adf5a3-e896-4640-830f-c28c8316314e","block_type":"box","text":"II-27","page_number":58,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"771384dc-babb-429a-bb3b-2e514260331d","block_type":"box","text":"NM0926U-5977317-58/232","page_number":58,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"f773b2d4-7937-4831-a968-e543728ecc96","block_type":"box","text":"are based on the performance of one or more underlying assets, reference rates or indexes, minus fees and","page_number":59,"box":{"x":69,"y":45,"width":774,"height":11}},{"id":"6c509420-d032-422d-a269-9c9d28ee4900","block_type":"box","text":"expenses. Similar to ETFs, ETNs are listed on an exchange and traded in the secondary market. However, unlike an","page_number":59,"box":{"x":69,"y":60,"width":822,"height":11}},{"id":"063da801-28f3-4305-9777-37d0f9fcfb7f","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 performance","page_number":59,"box":{"x":70,"y":75,"width":831,"height":11}},{"id":"4c6c9560-d0fb-4de3-be62-934883f69ff8","block_type":"box","text":"of the specific asset, index or rate (“reference instrument”) to which the ETN is linked minus certain fees. Unlike","page_number":59,"box":{"x":69,"y":90,"width":805,"height":11}},{"id":"53625775-eac2-4508-add9-d182b4b95ecc","block_type":"box","text":"regular bonds, ETNs do not make periodic interest payments, and principal is not protected.","page_number":59,"box":{"x":69,"y":105,"width":654,"height":11}},{"id":"848ac64c-77eb-451f-8d2e-06fa01dc621c","block_type":"box","text":"The value of an ETN may be influenced by, among other things, time to maturity, level of supply and demand for","page_number":59,"box":{"x":101,"y":128,"width":794,"height":11}},{"id":"58e5e402-1c07-47fe-9d8a-e172eda9d7ed","block_type":"box","text":"the ETN, volatility and lack of liquidity in underlying markets, changes in the applicable interest rates, the","page_number":59,"box":{"x":68,"y":143,"width":748,"height":11}},{"id":"b4d0a9a6-44f0-486d-bd84-e3a3210ec5cc","block_type":"box","text":"performance of the reference instrument, changes in the issuer’s credit rating and economic, legal, political or","page_number":59,"box":{"x":70,"y":158,"width":789,"height":11}},{"id":"d0d67adb-c5f3-4b1a-acd9-9b326ea8407b","block_type":"box","text":"geographic events that affect the reference instrument. ETNs are subject to credit risk and the value of the ETN may","page_number":59,"box":{"x":68,"y":173,"width":831,"height":11}},{"id":"e3811afd-b27b-4826-8b32-76997b316c00","block_type":"box","text":"drop due to a downgrade in an issuer’s credit rating, despite the underlying reference instrument remaining","page_number":59,"box":{"x":69,"y":188,"width":766,"height":12}},{"id":"d2bde276-a955-4ac4-8395-f4cb8fa52c1a","block_type":"box","text":"unchanged. When a Fund invests in ETNs, it will bear its proportionate share of any fees and expenses borne by the","page_number":59,"box":{"x":69,"y":203,"width":828,"height":12}},{"id":"0fe390ae-d40a-45ff-b5bb-92a297326043","block_type":"box","text":"ETN.","page_number":59,"box":{"x":70,"y":219,"width":30,"height":8}},{"id":"b16167e6-fa3f-4477-959e-d923e960f1d7","block_type":"box","text":"An ETN that is tied to a reference instrument may not replicate the performance of the reference instrument.","page_number":59,"box":{"x":101,"y":241,"width":776,"height":11}},{"id":"9ec635e5-38be-4520-b8d7-12637a84f72d","block_type":"box","text":"ETNs also incur certain expenses not incurred by their applicable reference instrument. Some ETNs that use leverage","page_number":59,"box":{"x":70,"y":256,"width":837,"height":12}},{"id":"9229b582-6a40-49d2-ae9d-3a569a53a42e","block_type":"box","text":"may, at times, be illiquid and may be difficult to purchase or sell at a fair price. Levered ETNs are subject to the same","page_number":59,"box":{"x":69,"y":271,"width":840,"height":12}},{"id":"695b79ec-4804-42f4-a70d-2ac23d47eba9","block_type":"box","text":"risk as other instruments that use leverage in any form. While leverage allows for greater potential return, the","page_number":59,"box":{"x":69,"y":286,"width":781,"height":12}},{"id":"4d0adba5-e0b6-461c-bd3e-b72ab2fe2614","block_type":"box","text":"potential for loss is also greater. Finally, additional losses may be incurred if the investment loses value because, in","page_number":59,"box":{"x":70,"y":302,"width":827,"height":11}},{"id":"63cde5cd-ad66-4b74-8275-50c63cb17a17","block_type":"box","text":"addition to the money lost on the investment, the loan still needs to be repaid.","page_number":59,"box":{"x":69,"y":317,"width":560,"height":11}},{"id":"0d404a7a-f26c-4b2f-9bf9-470834d1c7d2","block_type":"box","text":"Because the return on the ETN is dependent on the issuer’s ability or willingness to meet its obligations, the","page_number":59,"box":{"x":102,"y":340,"width":774,"height":11}},{"id":"c87752b8-1166-48a1-8461-e911eeb62ff2","block_type":"box","text":"value of the ETN may change due to a change in the issuer’s credit rating, despite no change in the underlying","page_number":59,"box":{"x":68,"y":355,"width":788,"height":11}},{"id":"7e426fb7-0022-4954-8a83-551cea5b4528","block_type":"box","text":"reference instrument. The market value of ETN shares may differ from the value of the reference instrument. This","page_number":59,"box":{"x":69,"y":370,"width":810,"height":11}},{"id":"37a8a6fc-0519-4a26-bb9f-b2b1dce3d713","block_type":"box","text":"difference in price may be due to the fact that the supply and demand in the market for ETN shares at any point in","page_number":59,"box":{"x":69,"y":385,"width":815,"height":11}},{"id":"fe7e809b-442c-4cac-a195-ddc10f3a0638","block_type":"box","text":"time is not always identical to the supply and demand in the market for the assets underlying the reference","page_number":59,"box":{"x":68,"y":400,"width":766,"height":11}},{"id":"0be17c50-86e0-4023-86a9-2adb85d5770b","block_type":"box","text":"instrument that the ETN seeks to track.","page_number":59,"box":{"x":70,"y":415,"width":279,"height":9}},{"id":"dc06c8dd-dbf9-4191-ac58-481e9ac2c7b8","block_type":"box","text":"There may be restrictions on the Fund’s right to redeem its investment in an ETN, which are generally meant to","page_number":59,"box":{"x":101,"y":438,"width":791,"height":11}},{"id":"cbfcd92b-7fcf-43b7-b7d3-564a1b738552","block_type":"box","text":"be held until maturity. The Fund’s decision to sell its ETN holdings may be limited by the availability of a secondary","page_number":59,"box":{"x":69,"y":453,"width":818,"height":11}},{"id":"fd9c6cdf-b988-4a78-92ad-de1022b8b076","block_type":"box","text":"market. An investor in an ETN could lose some or all of the amount invested.","page_number":59,"box":{"x":69,"y":468,"width":547,"height":9}},{"id":"7badbe2d-18af-464b-8119-42478ff670e5","block_type":"box","text":"ETNs are also subject to tax risks. The Internal Revenue Service (the “IRS”) may not accept, and a court may not","page_number":59,"box":{"x":102,"y":491,"width":807,"height":11}},{"id":"8390cfe6-78a7-456d-beb4-4c8d62ce498c","block_type":"box","text":"uphold, how the Funds characterize and treat ETNs for tax purposes. The timing and character of income and gains","page_number":59,"box":{"x":69,"y":506,"width":819,"height":11}},{"id":"d09464ec-633b-49da-a726-ace46a716b05","block_type":"box","text":"derived by a Fund from investments in ETNs may be affected by future legislation.","page_number":59,"box":{"x":69,"y":521,"width":581,"height":11}},{"id":"7b9c0ac0-b579-485f-b25e-b95c1035212f","block_type":"box","text":"Foreign Investments.","page_number":59,"box":{"x":102,"y":544,"width":152,"height":11}},{"id":"58c65f52-74c5-484a-b3e1-c9a1ad4a411a","block_type":"box","text":"Foreign Investment Risks.","page_number":59,"box":{"x":102,"y":566,"width":182,"height":11}},{"id":"32fc787e-6bc1-4b78-a9bb-09a6c4852c4c","block_type":"box","text":"Certain Funds may invest in foreign securities, including securities from issuers","page_number":59,"box":{"x":291,"y":566,"width":567,"height":11}},{"id":"08033262-7870-4580-99d7-cb62f0d5b5e7","block_type":"box","text":"located in emerging market countries. These securities may be denominated in U.S. dollars or in a foreign currency.","page_number":59,"box":{"x":70,"y":581,"width":822,"height":12}},{"id":"986f7f9c-f232-4d65-9bff-930d65910cee","block_type":"box","text":"Investing in foreign securities involves risks not typically associated with investing in securities of companies","page_number":59,"box":{"x":70,"y":596,"width":774,"height":12}},{"id":"85946046-a28b-498b-8141-b6400e961b98","block_type":"box","text":"organized and operated in the United States that can increase the chances that a Fund will lose money.","page_number":59,"box":{"x":69,"y":612,"width":738,"height":11}},{"id":"fdb0d596-63ba-4fb6-9bc6-f50d349a9d16","block_type":"box","text":"Securities issued by certain companies organized outside the United States may not be deemed to be foreign","page_number":59,"box":{"x":102,"y":634,"width":782,"height":12}},{"id":"687e513e-3b7f-4e4a-b167-471ecfe531d0","block_type":"box","text":"securities (but rather deemed to be U.S. securities) if (i) the company’s principal operations are conducted from the","page_number":59,"box":{"x":69,"y":649,"width":824,"height":12}},{"id":"eaa8d7c3-7c43-4e33-b414-ba12b1bf13ea","block_type":"box","text":"U.S., (ii) the company’s equity securities trade principally on a U.S. stock exchange, (iii) the company does a","page_number":59,"box":{"x":70,"y":665,"width":771,"height":11}},{"id":"2126eb9c-b5c3-4886-91ca-f4629c8b6dce","block_type":"box","text":"substantial amount of business in the U.S. or (iv) the issuer of securities is included in the Fund’s primary U.S.","page_number":59,"box":{"x":69,"y":680,"width":792,"height":11}},{"id":"a2f1e2de-d82a-48d3-9895-5740095a38ad","block_type":"box","text":"benchmark index.","page_number":59,"box":{"x":69,"y":695,"width":124,"height":9}},{"id":"df43da40-a0f1-495b-9614-8c4a1326b8ec","block_type":"box","text":"In addition to equity securities, foreign investments of the Funds may include: (a) debt obligations issued or","page_number":59,"box":{"x":102,"y":717,"width":767,"height":12}},{"id":"766b7ccf-a1f6-4336-9a41-7304fe609926","block_type":"box","text":"guaranteed by foreign sovereign governments or their agencies, authorities, instrumentalities or political","page_number":59,"box":{"x":68,"y":732,"width":742,"height":12}},{"id":"2b4c90ea-6812-4014-82cc-381cf1eb7ddc","block_type":"box","text":"subdivisions, including a foreign state, province or municipality; (b) debt obligations of supranational organizations;","page_number":59,"box":{"x":69,"y":748,"width":818,"height":11}},{"id":"8e0dd6d2-8d75-4276-b580-c69f47f408f5","block_type":"box","text":"(c) debt obligations of foreign banks and bank holding companies; (d) debt obligations of domestic banks and","page_number":59,"box":{"x":69,"y":763,"width":780,"height":11}},{"id":"e33aebcb-9d11-49f4-b765-e05fb7c7e205","block_type":"box","text":"corporations issued in foreign currencies; (e) debt obligations denominated in the Euro; and (f) foreign corporate debt","page_number":59,"box":{"x":69,"y":778,"width":837,"height":11}},{"id":"cc1c6c9f-60d7-4628-8d81-70e7b6b579f1","block_type":"box","text":"securities and commercial paper. Such securities may include loan participations and assignments, convertible","page_number":59,"box":{"x":69,"y":793,"width":794,"height":11}},{"id":"d5564978-6f67-45f8-8b55-a27ccc6d80fe","block_type":"box","text":"securities and zero-coupon securities.","page_number":59,"box":{"x":69,"y":808,"width":268,"height":11}},{"id":"f8e94311-3809-497c-9de3-5ba4c27fb434","block_type":"box","text":"Dividends or interest on, or proceeds from the sale of, foreign securities may be subject to foreign withholding","page_number":59,"box":{"x":102,"y":831,"width":785,"height":11}},{"id":"47d7578a-542d-4391-b6a3-f2a9ce4e58be","block_type":"box","text":"taxes.","page_number":59,"box":{"x":68,"y":847,"width":42,"height":8}},{"id":"ff991921-7d6b-4c9c-9ed4-9332ef89fc90","block_type":"box","text":"To the extent that the underlying securities or other instruments held by a Fund trade on foreign exchanges or in","page_number":59,"box":{"x":101,"y":869,"width":798,"height":11}},{"id":"8610147b-ca71-40a8-b5b6-79b016c65bf1","block_type":"box","text":"foreign markets that are closed when the securities exchange on which the Fund’s shares trade is open, there are","page_number":59,"box":{"x":68,"y":884,"width":815,"height":11}},{"id":"26c31523-7c7d-482f-9b53-b9c242b39178","block_type":"box","text":"likely to be deviations between the current price of such an underlying security and the last quoted price for the","page_number":59,"box":{"x":70,"y":899,"width":792,"height":11}},{"id":"6014f48c-8da5-4eea-b5ce-1d89ada614db","block_type":"box","text":"II-28","page_number":59,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"67f3ab58-ecaa-4d34-9576-8b7e48417bcc","block_type":"box","text":"NM0926U-5977317-59/232","page_number":59,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"28622385-09b8-40c7-8166-4c2f1a950f49","block_type":"box","text":"underlying security (","page_number":60,"box":{"x":69,"y":45,"width":140,"height":11}},{"id":"8aa59dc8-6a10-42b9-ac8c-c3dc2685f30d","block_type":"box","text":"i.e.","page_number":60,"box":{"x":211,"y":45,"width":20,"height":9}},{"id":"22c708ba-1fa3-4d72-8682-4cad46226d58","block_type":"box","text":", the Fund’s quote from the closed foreign market). The impact of a closed foreign market on a","page_number":60,"box":{"x":234,"y":45,"width":675,"height":11}},{"id":"d8f937be-b8a6-46c9-976a-58f791eb3849","block_type":"box","text":"Fund is likely to be greater where a large portion of the Fund’s underlying securities or other instruments trade on","page_number":60,"box":{"x":70,"y":60,"width":809,"height":11}},{"id":"07a53948-d5a0-437d-9811-2e00fcfd7b9f","block_type":"box","text":"that closed foreign market or when the foreign market is closed for unscheduled reasons. These deviations may","page_number":60,"box":{"x":68,"y":75,"width":800,"height":11}},{"id":"daca83ab-c13f-4342-84fc-b2842f544261","block_type":"box","text":"result in premiums or discounts to certain Funds’ NAVs that may be greater than those experienced by other ETFs.","page_number":60,"box":{"x":69,"y":90,"width":815,"height":11}},{"id":"69d455d3-71de-49bb-88b8-333dba9e591b","block_type":"box","text":"Foreign Market Risk.","page_number":60,"box":{"x":102,"y":113,"width":144,"height":11}},{"id":"5f7b318f-7ce9-4da7-8c6c-f76a65677fab","block_type":"box","text":"Funds that may invest in foreign securities offer the potential for more diversification than a","page_number":60,"box":{"x":254,"y":113,"width":652,"height":11}},{"id":"18fc91df-3aab-400b-985f-cb7039f0c080","block_type":"box","text":"Fund that invests only in the United States because securities traded on foreign markets have often (though not","page_number":60,"box":{"x":70,"y":128,"width":797,"height":11}},{"id":"4990aa0d-dc32-415a-9d1c-eec703d76825","block_type":"box","text":"always) performed differently from securities traded in the United States. However, such investments often involve","page_number":60,"box":{"x":69,"y":143,"width":817,"height":11}},{"id":"45c5b5b4-9f60-4cdb-95cd-21bfd72e0a45","block_type":"box","text":"risks not present in U.S. investments that can increase the chances that a Fund will lose money. In particular, a Fund","page_number":60,"box":{"x":69,"y":158,"width":836,"height":11}},{"id":"edc61d1c-fbf6-432b-8f63-4e7ac0ae86ec","block_type":"box","text":"is subject to the risk that, because there are generally fewer investors on foreign exchanges and a smaller number of","page_number":60,"box":{"x":70,"y":173,"width":835,"height":11}},{"id":"7ac0c626-f814-4845-976e-4d1dce3b4c48","block_type":"box","text":"shares traded each day, it may be difficult for the Fund to buy and sell securities on those exchanges. In addition,","page_number":60,"box":{"x":69,"y":188,"width":810,"height":12}},{"id":"8bef0f94-3020-4a48-b536-cc8300669887","block_type":"box","text":"prices of foreign securities may fluctuate more than prices of securities traded in the United States. Investments in","page_number":60,"box":{"x":70,"y":203,"width":820,"height":12}},{"id":"f9046637-8b12-4e90-a83f-e6175e62ff42","block_type":"box","text":"foreign markets may also be adversely affected by governmental actions such as the imposition of punitive taxes or","page_number":60,"box":{"x":68,"y":218,"width":826,"height":12}},{"id":"c53b3532-eb1d-4f05-9a76-ad4eb46cd013","block_type":"box","text":"tariffs. In addition, economic conditions, such as volatile currency exchange rates and interest rates, political events,","page_number":60,"box":{"x":68,"y":234,"width":836,"height":11}},{"id":"baf27200-08e6-4b49-baa4-4a919e0b431f","block_type":"box","text":"military action and other conditions may, without prior warning, lead to the governments of certain countries, or the","page_number":60,"box":{"x":69,"y":249,"width":821,"height":11}},{"id":"07c53ae6-244e-4803-9320-1803386a052d","block_type":"box","text":"U.S. Government with respect to certain countries, prohibiting or imposing substantial restrictions through capital","page_number":60,"box":{"x":70,"y":264,"width":807,"height":11}},{"id":"3d7fe2fd-0e1d-4c0c-825f-9712e6a7bd85","block_type":"box","text":"controls and/or sanctions on foreign investing in the capital markets or certain industries in those countries. Capital","page_number":60,"box":{"x":69,"y":279,"width":830,"height":11}},{"id":"902e23ec-51a0-4011-a95b-7a3b43f8582c","block_type":"box","text":"controls and/or sanctions may include the prohibition of, or restrictions on, the ability to own or transfer currency,","page_number":60,"box":{"x":69,"y":294,"width":810,"height":11}},{"id":"fdb5ecb5-89be-4cdd-a287-4ee15059ebca","block_type":"box","text":"securities, derivatives or other assets and may also include retaliatory actions of one government against another","page_number":60,"box":{"x":69,"y":309,"width":813,"height":11}},{"id":"70498afd-7e39-4148-bc28-122f255eef34","block_type":"box","text":"government, such as seizure of assets. Any of these actions could severely impair a Fund’s ability to purchase, sell,","page_number":60,"box":{"x":68,"y":324,"width":828,"height":12}},{"id":"bee4394d-6573-4c4b-8d6d-95c09a1ed28d","block_type":"box","text":"transfer, receive, deliver or otherwise obtain exposure to foreign securities and assets, including the ability to","page_number":60,"box":{"x":68,"y":339,"width":782,"height":12}},{"id":"010318bd-9b31-489a-ad61-f041be9efa07","block_type":"box","text":"transfer the Fund’s assets or income back into the United States, and could negatively impact the value and/or","page_number":60,"box":{"x":68,"y":355,"width":796,"height":11}},{"id":"7128e1f8-f149-4cd8-991e-3a32d2c1eb2e","block_type":"box","text":"liquidity of such assets or otherwise adversely affect a Fund’s operations, causing the Fund to decline in value. Other","page_number":60,"box":{"x":70,"y":370,"width":837,"height":11}},{"id":"a7bf84dd-ed41-4780-ac7c-c412329a7b45","block_type":"box","text":"potential foreign market risks include exchange controls, difficulties in pricing securities, defaults on foreign","page_number":60,"box":{"x":70,"y":385,"width":768,"height":11}},{"id":"54c6517c-2eeb-47e0-abf8-1ad9ceea27a0","block_type":"box","text":"government securities, difficulties in enforcing favorable legal judgments in foreign courts, and political and social","page_number":60,"box":{"x":68,"y":400,"width":813,"height":11}},{"id":"f637563f-3794-4aa4-9cfa-517d94f19ae2","block_type":"box","text":"conditions, such as diplomatic relations, confiscatory taxation, expropriation, limitation on the removal of funds or","page_number":60,"box":{"x":69,"y":415,"width":814,"height":11}},{"id":"39c63692-ae43-48c8-a76e-b645ad50df86","block_type":"box","text":"assets, or imposition of (or change in) exchange control regulations. Legal remedies available to investors in certain","page_number":60,"box":{"x":69,"y":430,"width":828,"height":11}},{"id":"e851420c-4cd5-4371-8ff7-b8d6ff4ba339","block_type":"box","text":"foreign countries may be less extensive than those available to investors in the United States or other foreign","page_number":60,"box":{"x":68,"y":445,"width":782,"height":12}},{"id":"4cf19b5d-e1a4-4a41-85aa-53a9a98ab7ab","block_type":"box","text":"countries. In addition, changes in government administrations or economic or monetary policies in the United States","page_number":60,"box":{"x":69,"y":460,"width":830,"height":12}},{"id":"31611bfe-4e56-41d6-8064-2e2c00531ab0","block_type":"box","text":"or abroad could result in appreciation or depreciation of portfolio securities and could favorably or adversely affect a","page_number":60,"box":{"x":69,"y":475,"width":829,"height":12}},{"id":"6aeeca04-99e4-4c61-89a6-041812d894ce","block_type":"box","text":"Fund’s operations.","page_number":60,"box":{"x":70,"y":491,"width":130,"height":11}},{"id":"a7a260ef-9e06-46ca-b2a7-24215bb0f81a","block_type":"box","text":"Foreign Economy Risk.","page_number":60,"box":{"x":102,"y":514,"width":158,"height":11}},{"id":"f9e4d05b-0cfe-4106-bf6c-eb07fd4a2923","block_type":"box","text":"The economies of certain foreign markets often do not compare favorably with that of the","page_number":60,"box":{"x":267,"y":513,"width":636,"height":12}},{"id":"e965deb9-3730-48c4-a0a9-07a311e9c345","block_type":"box","text":"United States with respect to such issues as growth of gross national product, reinvestment of capital, resources,","page_number":60,"box":{"x":70,"y":528,"width":812,"height":12}},{"id":"26302b89-5772-4ccb-ad7e-4c4f717c4a0c","block_type":"box","text":"and balance of payments position. Certain such economies may rely heavily on particular industries or foreign capital","page_number":60,"box":{"x":69,"y":543,"width":835,"height":12}},{"id":"1ada5cc9-48b8-4c0e-9bad-e6ce97267fb3","block_type":"box","text":"and are more vulnerable to diplomatic developments, the imposition of economic sanctions against a particular","page_number":60,"box":{"x":69,"y":559,"width":795,"height":11}},{"id":"b9372f44-84ea-4839-8f8e-0156c3a48b68","block_type":"box","text":"country or countries, changes in international trading patterns, trade barriers, and other protectionist or retaliatory","page_number":60,"box":{"x":69,"y":574,"width":817,"height":11}},{"id":"ed46c64a-b972-4ec4-9a26-383882799cf3","block_type":"box","text":"measures.","page_number":60,"box":{"x":69,"y":591,"width":74,"height":7}},{"id":"691ee901-cb66-4b3f-b3fd-08d2bc133305","block_type":"box","text":"Currency Risk and Exchange Risk.","page_number":60,"box":{"x":102,"y":612,"width":240,"height":11}},{"id":"9485fdea-cbb0-45fd-acde-0ecd6922a795","block_type":"box","text":"Because foreign securities generally are denominated and pay dividends or","page_number":60,"box":{"x":349,"y":612,"width":534,"height":11}},{"id":"10a30ece-635e-4d20-9215-8e3ccc87b2c0","block_type":"box","text":"interest in foreign currencies, the value of a Fund that invests in foreign securities as measured in U.S. dollars will be","page_number":60,"box":{"x":70,"y":627,"width":838,"height":11}},{"id":"95a2e41a-02f3-464a-bbb1-3925202dd96f","block_type":"box","text":"affected favorably or unfavorably by changes in exchange rates. Generally, when the U.S. dollar rises in value against","page_number":60,"box":{"x":69,"y":642,"width":833,"height":11}},{"id":"837652eb-81ef-4820-a852-6658de79f63c","block_type":"box","text":"a foreign currency, a security denominated in that currency loses value because the currency is worth fewer U.S.","page_number":60,"box":{"x":69,"y":657,"width":801,"height":11}},{"id":"6194dbd4-7a3e-4e7f-8933-4dac8d52d838","block_type":"box","text":"dollars. Conversely, when the U.S. dollar decreases in value against a foreign currency, a security denominated in","page_number":60,"box":{"x":69,"y":672,"width":808,"height":11}},{"id":"077937a2-e732-41b1-9091-bf24d1bd8b93","block_type":"box","text":"that currency gains value because the currency is worth more U.S. dollars. This risk, generally known as “currency","page_number":60,"box":{"x":68,"y":687,"width":816,"height":11}},{"id":"bd6cdff6-2677-46e2-a252-6fd77970ab23","block_type":"box","text":"risk,” means that a stronger U.S. dollar will reduce returns for U.S. investors while a weak U.S. dollar will increase","page_number":60,"box":{"x":69,"y":702,"width":814,"height":12}},{"id":"4fbe7478-153a-47f6-a00c-48607e433de8","block_type":"box","text":"those returns. Currency exchange rates can also be affected unpredictably by intervention by U.S. or foreign","page_number":60,"box":{"x":68,"y":717,"width":771,"height":12}},{"id":"c58691b7-2de0-40e1-80e6-e5094d655ab4","block_type":"box","text":"governments or central banks, or the failure to intervene, or buy currency controls or political developments in the","page_number":60,"box":{"x":68,"y":732,"width":813,"height":12}},{"id":"cce6a665-d4bf-4027-8ecd-f048a2836922","block_type":"box","text":"United States or abroad.","page_number":60,"box":{"x":70,"y":748,"width":172,"height":9}},{"id":"93a0303b-0f79-4eab-91d8-c4ab6b49b033","block_type":"box","text":"Governmental Supervision and Regulation/Accounting Standards.","page_number":60,"box":{"x":102,"y":770,"width":466,"height":12}},{"id":"cfaf2fce-78b0-4870-b447-39d5e0296b94","block_type":"box","text":"Many foreign governments supervise and","page_number":60,"box":{"x":575,"y":770,"width":293,"height":12}},{"id":"519b0b58-7aaf-4a8e-b550-116cd3a66985","block_type":"box","text":"regulate stock exchanges, brokers and the sale of securities less than does the United States. Some countries may","page_number":60,"box":{"x":69,"y":785,"width":828,"height":12}},{"id":"66c45e94-ff67-40c5-8958-e3c45da3bee3","block_type":"box","text":"not have laws to protect investors comparable to the U.S. securities laws. For example, some foreign countries may","page_number":60,"box":{"x":69,"y":801,"width":826,"height":11}},{"id":"281e937b-e282-4a17-9515-27ae0ab2a2e4","block_type":"box","text":"have no laws or rules against insider trading. Insider trading occurs when a person buys or sells a company’s","page_number":60,"box":{"x":69,"y":816,"width":778,"height":11}},{"id":"dd75a5b7-1597-4f60-9d3e-c62122e5e901","block_type":"box","text":"securities based on nonpublic information about that company. Accounting standards in other countries are not","page_number":60,"box":{"x":69,"y":831,"width":794,"height":11}},{"id":"5475a3e8-2f89-4d3a-a9a0-a895224e90ac","block_type":"box","text":"necessarily the same as in the United States. If the accounting standards in another country do not require as much","page_number":60,"box":{"x":69,"y":846,"width":831,"height":11}},{"id":"8ed78301-168e-4751-919b-39b7ef8bbc94","block_type":"box","text":"detail as U.S. accounting standards, it may be harder for Fund management to completely and accurately determine a","page_number":60,"box":{"x":69,"y":861,"width":840,"height":11}},{"id":"25bc94b8-de02-402f-8973-d0ce5f050278","block_type":"box","text":"company’s financial condition. In addition, the U.S. Government has from time to time in the past imposed","page_number":60,"box":{"x":69,"y":876,"width":760,"height":11}},{"id":"8b22575a-7710-4bc7-aa83-cefbafc3108e","block_type":"box","text":"restrictions, through penalties and otherwise, on foreign investments by U.S. investors such as the Fund. If such","page_number":60,"box":{"x":69,"y":891,"width":803,"height":12}},{"id":"1a5db254-5d17-470f-9060-e471f8026128","block_type":"box","text":"restrictions should be reinstituted, it might become necessary for the Fund to invest all or substantially all of its","page_number":60,"box":{"x":69,"y":906,"width":798,"height":12}},{"id":"1749beb9-6aa2-435d-aadb-c4a56b15f791","block_type":"box","text":"II-29","page_number":60,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"e6c30e5f-fb47-4af2-8839-3749d22d9b90","block_type":"box","text":"NM0926U-5977317-60/232","page_number":60,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"91ae70fb-6a0b-4890-b5c6-12bdc3e61b19","block_type":"box","text":"assets in U.S. securities. Also, brokerage commissions and other costs of buying or selling securities often are","page_number":61,"box":{"x":69,"y":45,"width":793,"height":11}},{"id":"c0bbb5b0-c9a2-4f52-832f-85c788ecec73","block_type":"box","text":"higher in foreign countries than they are in the United States. This reduces the amount the Fund can earn on its","page_number":61,"box":{"x":69,"y":60,"width":797,"height":11}},{"id":"1b569fce-924b-48db-bfac-7f96169c7f99","block_type":"box","text":"investments.","page_number":61,"box":{"x":70,"y":75,"width":89,"height":9}},{"id":"1667c008-9f70-4d72-872d-01074f4b956f","block_type":"box","text":"Cer tain Risks of Holding Fund Assets Outside the United States.","page_number":61,"box":{"x":102,"y":98,"width":458,"height":11}},{"id":"019d538a-d826-4e5f-8080-328c1005ac06","block_type":"box","text":"A Fund generally holds its foreign securities and","page_number":61,"box":{"x":566,"y":98,"width":341,"height":11}},{"id":"3a88ea26-a321-4d85-b6be-815d7bb35853","block_type":"box","text":"cash in foreign banks and securities depositories. Some foreign banks and securities depositories may be recently","page_number":61,"box":{"x":69,"y":113,"width":819,"height":11}},{"id":"d12b2f7f-5385-4cd9-b093-a8275666cfae","block_type":"box","text":"organized or new to the foreign custody business. In addition, there may be limited or no regulatory oversight over","page_number":61,"box":{"x":69,"y":128,"width":813,"height":11}},{"id":"e8a8428b-6d30-42da-9f77-2bd603f691b9","block_type":"box","text":"their operations. Also, the laws of certain countries may put limits on a Fund’s ability to recover its assets if a foreign","page_number":61,"box":{"x":68,"y":143,"width":838,"height":11}},{"id":"0a9b8055-4ff2-49f6-a209-61d422863d4b","block_type":"box","text":"bank or depository or issuer of a security or any of their agents goes bankrupt. In addition, it is often more expensive","page_number":61,"box":{"x":69,"y":158,"width":835,"height":11}},{"id":"98c1076c-a316-4c88-b4a9-dc20a45d6b56","block_type":"box","text":"for a Fund to buy, sell and hold securities in certain foreign markets than in the United States. The increased","page_number":61,"box":{"x":68,"y":173,"width":777,"height":11}},{"id":"4e6a4b53-7ebd-45c6-b517-8ccab1806cfe","block_type":"box","text":"expense of investing in foreign markets reduces the amount a Fund can earn on its investments and typically results","page_number":61,"box":{"x":69,"y":188,"width":831,"height":12}},{"id":"ed84649f-a393-47ab-920a-852938744512","block_type":"box","text":"in a higher operating expense ratio for the Fund as compared to investment companies that invest only in the United","page_number":61,"box":{"x":70,"y":203,"width":828,"height":12}},{"id":"c1a094b4-7974-45be-a50e-f3de938f900d","block_type":"box","text":"States.","page_number":61,"box":{"x":69,"y":219,"width":49,"height":8}},{"id":"144d624b-3b83-489e-ab22-e1b5c31c99a5","block_type":"box","text":"Publicly Available Information.","page_number":61,"box":{"x":102,"y":241,"width":210,"height":11}},{"id":"4fe8bfda-16e0-4613-a83a-bf7b2631c4e9","block_type":"box","text":"In general, less information is publicly available with respect to foreign issuers","page_number":61,"box":{"x":319,"y":241,"width":558,"height":11}},{"id":"ae2e3102-1dd4-4562-b3cb-3bcbe36c6e96","block_type":"box","text":"than is available with respect to U.S. companies. Most foreign companies are also not subject to the uniform","page_number":61,"box":{"x":68,"y":256,"width":779,"height":12}},{"id":"484fd5ef-f109-495a-91e3-e56a7d5aca8e","block_type":"box","text":"accounting and financial reporting requirements applicable to issuers in the United States. While the volume of","page_number":61,"box":{"x":69,"y":271,"width":793,"height":12}},{"id":"c8fd5e56-2ead-4052-9f58-115bd3f409ce","block_type":"box","text":"transactions effected on foreign stock exchanges has increased in recent years, it remains appreciably below that of","page_number":61,"box":{"x":68,"y":286,"width":834,"height":12}},{"id":"7658fa0e-6fd9-42d6-b2f0-75998634be33","block_type":"box","text":"the New York Stock Exchange. Accordingly, a Fund’s foreign investments may be less liquid than, and their prices may","page_number":61,"box":{"x":68,"y":302,"width":841,"height":11}},{"id":"d669e886-7f09-4f8f-9180-6292601b1cff","block_type":"box","text":"be more volatile than, comparable investments in securities in U.S. companies. In addition, there is generally less","page_number":61,"box":{"x":69,"y":317,"width":813,"height":11}},{"id":"b416ba44-14a2-455f-88c8-77d3087838e5","block_type":"box","text":"government supervision and regulation of securities exchanges, brokers and issuers in foreign countries than in the","page_number":61,"box":{"x":68,"y":332,"width":827,"height":11}},{"id":"5d140770-7ea7-425f-b9e9-7af3643c88b2","block_type":"box","text":"United States.","page_number":61,"box":{"x":70,"y":347,"width":99,"height":9}},{"id":"6d1270dd-bde4-45a0-9e1b-678c55b552ae","block_type":"box","text":"Settlement Risk.","page_number":61,"box":{"x":102,"y":370,"width":116,"height":9}},{"id":"d60a7f81-f97d-4e5a-bff9-1eef69241c31","block_type":"box","text":"Settlement and clearance procedures in certain foreign markets differ significantly from those","page_number":61,"box":{"x":225,"y":370,"width":669,"height":11}},{"id":"0cfc9840-c838-4d6f-b34f-6a2c7c1015f8","block_type":"box","text":"in the United States. Supervisory authorities may also be unable to apply standards which are comparable with those","page_number":61,"box":{"x":70,"y":385,"width":837,"height":11}},{"id":"1ada703f-7fe4-4920-a05c-1a4f2563cf01","block_type":"box","text":"in the United States. Foreign settlement procedures and trade regulations also may involve certain risks (such as","page_number":61,"box":{"x":70,"y":400,"width":808,"height":11}},{"id":"29be90a7-4366-4fd3-ae40-9e7a68ecd287","block_type":"box","text":"delays in payment for or delivery of securities) not typically generated by the settlement of U.S. investments.","page_number":61,"box":{"x":69,"y":415,"width":772,"height":11}},{"id":"bc5b67ba-75da-498a-9037-542252de4112","block_type":"box","text":"Communications between the United States and emerging market countries may be unreliable, increasing the","page_number":61,"box":{"x":102,"y":438,"width":781,"height":11}},{"id":"c48f1040-cd75-4084-8469-0dc6260b8751","block_type":"box","text":"risk of delayed settlements or losses of security certificates in markets that still rely on physical settlement.","page_number":61,"box":{"x":69,"y":453,"width":771,"height":11}},{"id":"fec6ffd4-edaa-442e-a5c4-c065d6b51962","block_type":"box","text":"Settlements in certain foreign countries at times have not kept pace with the number of securities transactions;","page_number":61,"box":{"x":69,"y":468,"width":797,"height":11}},{"id":"b54bd28b-fb78-4cfa-a0ab-fe6c9d71b053","block_type":"box","text":"these problems may make it difficult for a Fund to carry out transactions. If a Fund cannot settle or is delayed in","page_number":61,"box":{"x":68,"y":483,"width":802,"height":11}},{"id":"73d8b975-ef9d-4f63-805b-4cf194147a10","block_type":"box","text":"settling a purchase of securities, it may miss attractive investment opportunities and certain of its assets may be","page_number":61,"box":{"x":69,"y":498,"width":812,"height":11}},{"id":"96859219-3a6e-4def-8fa9-24e794aeb851","block_type":"box","text":"uninvested with no return earned thereon for some period. If a Fund cannot settle or is delayed in settling a sale of","page_number":61,"box":{"x":69,"y":513,"width":821,"height":12}},{"id":"0cfcb1bf-677b-4ce0-91e0-6cda87c5b4ca","block_type":"box","text":"securities, it may lose money if the value of the security then declines or, if it has contracted to sell the security to","page_number":61,"box":{"x":69,"y":528,"width":816,"height":12}},{"id":"09ec5862-a1bd-48ae-ab3a-cc2d0a7ee87f","block_type":"box","text":"another party, the Fund could be liable to that party for any losses incurred.","page_number":61,"box":{"x":69,"y":543,"width":539,"height":12}},{"id":"32ffbe7e-ce02-41ed-83ef-3e1267d5e7a6","block_type":"box","text":"Because of uncertainties in the operation of settlement systems in individual markets, competing claims may","page_number":61,"box":{"x":102,"y":566,"width":781,"height":11}},{"id":"3c5a259c-2ee6-4132-8a8b-db33e68f9a31","block_type":"box","text":"arise in respect of securities held by or to be transferred to a Fund. Compensation schemes may not exist or may","page_number":61,"box":{"x":69,"y":581,"width":810,"height":11}},{"id":"16302980-b3be-4464-b619-8729d61898ee","block_type":"box","text":"otherwise be limited or inadequate to meet the Fund’s claims in case of such event.","page_number":61,"box":{"x":69,"y":596,"width":601,"height":11}},{"id":"294fb74f-dc59-48e8-9a08-a3a8c36463fc","block_type":"box","text":"Sovereign Debt.","page_number":61,"box":{"x":102,"y":619,"width":111,"height":11}},{"id":"eae44b75-e6f3-42b3-bbd2-eb35ac80da60","block_type":"box","text":"Investment in sovereign debt can involve a high degree of risk. The governmental entity that","page_number":61,"box":{"x":221,"y":619,"width":653,"height":11}},{"id":"fd837656-95a4-445d-b987-1c55be3a1ab8","block_type":"box","text":"controls the repayment of sovereign debt may not be able or willing to repay the principal and/or interest when due in","page_number":61,"box":{"x":69,"y":634,"width":837,"height":12}},{"id":"d8eac272-da95-4a86-aa0d-5c3f009198e1","block_type":"box","text":"accordance with the terms of such debt. A governmental entity’s willingness or ability to repay principal and interest","page_number":61,"box":{"x":69,"y":649,"width":826,"height":12}},{"id":"66d9a19b-30b3-413b-8866-ed4631cf8228","block_type":"box","text":"due in a timely manner may be affected by, among other factors, its cash flow situation, the extent of its foreign","page_number":61,"box":{"x":69,"y":664,"width":798,"height":12}},{"id":"e6691c72-b658-4ef7-a50a-567a10da52c9","block_type":"box","text":"reserves, the availability of sufficient foreign exchange on the date a payment is due, the relative size of the debt","page_number":61,"box":{"x":69,"y":680,"width":809,"height":11}},{"id":"3d0944e1-d0e6-4bd5-ac07-66973f923f16","block_type":"box","text":"service burden to the economy as a whole, the governmental entity’s policy towards the International Monetary Fund","page_number":61,"box":{"x":69,"y":695,"width":832,"height":11}},{"id":"a99ea1f5-c2fa-4cd1-a1e4-d43d59c1a5c4","block_type":"box","text":"and the political constraints to which a governmental entity may be subject. Governmental entities may also be","page_number":61,"box":{"x":69,"y":710,"width":790,"height":11}},{"id":"b31e6d33-00ac-4645-af31-dd1245486551","block_type":"box","text":"dependent on expected disbursements from foreign governments, multilateral agencies and others abroad to reduce","page_number":61,"box":{"x":69,"y":725,"width":831,"height":11}},{"id":"0b31a759-856a-4e57-899c-1b7d4db870b4","block_type":"box","text":"principal and interest arrearages on their debt. The commitment on the part of these governments, agencies and","page_number":61,"box":{"x":70,"y":740,"width":805,"height":11}},{"id":"8af6359f-c923-4b34-8402-693c3b2b5d40","block_type":"box","text":"others to make such disbursements may be conditioned on the implementation of economic reforms and/or","page_number":61,"box":{"x":69,"y":755,"width":772,"height":11}},{"id":"c094d8f9-29ac-49f4-a93f-89cb9849139d","block_type":"box","text":"economic performance and the timely service of such debtor’s obligations. Failure to implement such reforms,","page_number":61,"box":{"x":69,"y":770,"width":789,"height":12}},{"id":"b6f7f96a-7a6b-4290-aac3-548864614099","block_type":"box","text":"achieve such levels of economic performance or repay principal or interest when due may result in the cancellation of","page_number":61,"box":{"x":69,"y":785,"width":839,"height":12}},{"id":"c0b8daf1-595f-4138-8e1f-9b68277cfda2","block_type":"box","text":"such third parties’ commitments to lend funds to the governmental entity, which may further impair such debtor’s","page_number":61,"box":{"x":69,"y":801,"width":810,"height":11}},{"id":"3f229ffb-01c3-46f1-bcf0-8fc359b5846a","block_type":"box","text":"ability or willingness to timely service its debts. Consequently, governmental entities may default on their sovereign","page_number":61,"box":{"x":69,"y":816,"width":821,"height":11}},{"id":"2448486e-9891-42a2-9c5f-f026c467fa72","block_type":"box","text":"debt.","page_number":61,"box":{"x":69,"y":831,"width":34,"height":9}},{"id":"85c2fe64-50ee-4028-992a-f86d1ad1da76","block_type":"box","text":"Holders of sovereign debt may be requested to participate in the rescheduling of such debt and to extend further","page_number":61,"box":{"x":102,"y":853,"width":807,"height":12}},{"id":"949a01ef-124b-45ca-815e-438831ceb60a","block_type":"box","text":"loans to governmental entities. In the event of a default by a governmental entity, there may be few or no effective","page_number":61,"box":{"x":70,"y":869,"width":814,"height":11}},{"id":"336cb718-80d3-419c-8d9e-a063d855f6e2","block_type":"box","text":"legal remedies for collecting on such debt.","page_number":61,"box":{"x":70,"y":884,"width":300,"height":11}},{"id":"bb953255-8d07-481a-ad0b-6ba751e323c0","block_type":"box","text":"II-30","page_number":61,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"0fbe640a-75d7-4f5c-ab8a-a403d96cf16c","block_type":"box","text":"NM0926U-5977317-61/232","page_number":61,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"da5d1fec-3304-46d5-95f3-d995b3ef14d7","block_type":"box","text":"Withholding Tax Reclaims Risk","page_number":62,"box":{"x":103,"y":45,"width":215,"height":11}},{"id":"1e9ac964-568b-4b47-b896-015f8d38ed71","block_type":"box","text":". A Fund may file claims to recover foreign withholding taxes on dividend and","page_number":62,"box":{"x":318,"y":45,"width":542,"height":11}},{"id":"60ff5c59-c8fc-4549-aced-2fa84e6ed270","block_type":"box","text":"interest income (if any) received from issuers in certain countries and capital gains on the disposition of stocks or","page_number":62,"box":{"x":70,"y":60,"width":813,"height":11}},{"id":"973dce6a-7996-4825-b89d-57abd3718a96","block_type":"box","text":"securities where such withholding tax reclaim is possible. Whether or when a Fund will receive a withholding tax","page_number":62,"box":{"x":69,"y":75,"width":795,"height":11}},{"id":"ad97599b-5a2e-4365-aae6-1f7b7404f481","block_type":"box","text":"refund is within the control of the tax authorities in such countries. Where a Fund expects to recover withholding","page_number":62,"box":{"x":69,"y":90,"width":799,"height":11}},{"id":"e76fafec-1fa6-46be-914b-f1ff47457614","block_type":"box","text":"taxes, the net asset value of the Fund generally includes accruals for such tax refunds. Each Fund regularly evaluates","page_number":62,"box":{"x":68,"y":105,"width":838,"height":11}},{"id":"a344d59b-a4b3-4823-a2a8-5ceff2e6be15","block_type":"box","text":"the probability of recovery. If the likelihood of recovery materially decreases, due to, for example, a change in tax","page_number":62,"box":{"x":68,"y":120,"width":807,"height":12}},{"id":"13d20f03-95d9-4f58-938b-04bf6b2ee10d","block_type":"box","text":"regulation or approach in the foreign country, accruals in a Fund’s net asset value for such refunds may be written","page_number":62,"box":{"x":69,"y":135,"width":814,"height":12}},{"id":"bd644998-9e9e-4c5e-bcaf-5298738e2e73","block_type":"box","text":"down partially or in full, which will adversely affect the Fund’s net asset value. Shareholders in a Fund at the time an","page_number":62,"box":{"x":69,"y":150,"width":831,"height":12}},{"id":"8c46802a-cbe2-4137-8488-acadc8354b59","block_type":"box","text":"accrual is written down will bear the impact of the resulting reduction in net asset value regardless of whether they","page_number":62,"box":{"x":69,"y":166,"width":819,"height":11}},{"id":"ac1a7a71-e94f-4abd-853d-a87c14e0a5a0","block_type":"box","text":"were shareholders during the accrual period. Conversely, if a Fund receives a tax refund that has not been previously","page_number":62,"box":{"x":68,"y":181,"width":833,"height":11}},{"id":"c0c5444b-c5b5-4fbd-b7e1-6e48af7cc78b","block_type":"box","text":"accrued, shareholders in the Fund at the time of the successful recovery will benefit from the resulting increase in","page_number":62,"box":{"x":69,"y":196,"width":814,"height":11}},{"id":"3fa453a1-0476-4466-abab-bf48931f7a91","block_type":"box","text":"the Fund’s net asset value. Shareholders who sold their shares prior to such time will not benefit from such increase","page_number":62,"box":{"x":68,"y":211,"width":835,"height":11}},{"id":"7e4f12f5-7088-45cc-a706-e673ec9404df","block_type":"box","text":"in the Fund’s net asset value.","page_number":62,"box":{"x":70,"y":226,"width":209,"height":9}},{"id":"5f53098c-50c4-424e-8368-55dd5eee33c3","block_type":"box","text":"U.S. Economic Trading Par tners Risk.","page_number":62,"box":{"x":103,"y":249,"width":263,"height":11}},{"id":"be55c674-90fb-4c14-9c49-597675b405ab","block_type":"box","text":"The United States is a significant, and in some cases the most significant,","page_number":62,"box":{"x":372,"y":249,"width":532,"height":11}},{"id":"450dad31-9ae3-4626-9a6f-c1601879bfec","block_type":"box","text":"trading partner of, or foreign investor in, certain countries in which a Fund may invest. As a result, economic","page_number":62,"box":{"x":68,"y":264,"width":773,"height":11}},{"id":"ee1f780d-2cb0-4261-a11a-23f0c1cfb23c","block_type":"box","text":"conditions of such countries may be particularly affected by changes in the U.S. economy. A decrease in U.S. imports","page_number":62,"box":{"x":69,"y":279,"width":839,"height":11}},{"id":"bdfd10b4-7e37-41fd-b6f5-a3b5a2b4012e","block_type":"box","text":"or exports, new trade and financial regulations or tariffs, changes in the U.S. dollar exchange rate or an economic","page_number":62,"box":{"x":69,"y":294,"width":812,"height":11}},{"id":"0f95f7e8-a1ed-414d-b95d-4567130bead0","block_type":"box","text":"slowdown in the United States may have a material adverse effect on a country’s economic conditions and, as a","page_number":62,"box":{"x":69,"y":309,"width":803,"height":11}},{"id":"4532b378-1175-400e-a7e3-b4cbcc6acd93","block_type":"box","text":"result, securities to which the Fund has exposure. Circumstances could arise that could prevent the timely payment","page_number":62,"box":{"x":69,"y":324,"width":824,"height":11}},{"id":"051f90a5-9323-4831-a9ae-3ee18db5a984","block_type":"box","text":"of interest or principal on U.S. Government debt, such as reaching the legislative “debt ceiling.” Such non-payment","page_number":62,"box":{"x":69,"y":339,"width":819,"height":12}},{"id":"4db09920-9a51-4375-9ba6-aa2a0574c599","block_type":"box","text":"would result in substantial negative consequences for the U.S. economy and the global financial system.","page_number":62,"box":{"x":68,"y":355,"width":746,"height":11}},{"id":"74bc262e-af6c-47a0-8bea-6caf4e88aa6e","block_type":"box","text":"There are strained relations between the United States and a number of foreign countries, including traditional","page_number":62,"box":{"x":101,"y":377,"width":787,"height":12}},{"id":"3f931c45-13a7-4fe6-9ce2-f78e23e4a6dd","block_type":"box","text":"allies, such as certain European countries, and historical adversaries, such as North Korea, Iran, China and Russia.","page_number":62,"box":{"x":69,"y":392,"width":827,"height":11}},{"id":"99ac1cb4-c2b2-46f6-abca-4b2553842dfe","block_type":"box","text":"If these relations were to worsen, it could adversely affect U.S. issuers as well as non-U.S. issuers that rely on the","page_number":62,"box":{"x":70,"y":407,"width":817,"height":12}},{"id":"52116740-83c0-4676-895c-d78e323226e6","block_type":"box","text":"United States for trade. The United States has also experienced increased internal unrest and discord. If these","page_number":62,"box":{"x":70,"y":423,"width":791,"height":11}},{"id":"19e77eff-f288-4c3d-8f7c-2aeeab729918","block_type":"box","text":"trends were to continue, it may have an adverse impact on the U.S. economy and many of the issuers in which a","page_number":62,"box":{"x":68,"y":438,"width":803,"height":11}},{"id":"771f01ba-acee-4447-9585-86dfba6da986","block_type":"box","text":"Fund may invest.","page_number":62,"box":{"x":70,"y":453,"width":117,"height":11}},{"id":"2979d865-9142-4b5a-a3d2-bdc0ac90fcb8","block_type":"box","text":"Funding Agreements.","page_number":62,"box":{"x":102,"y":476,"width":154,"height":11}},{"id":"4feb5acd-a298-4ca4-9d1b-2f525342714f","block_type":"box","text":"Certain Funds may invest in Guaranteed Investment Contracts and similar funding","page_number":62,"box":{"x":262,"y":475,"width":584,"height":12}},{"id":"85c93a65-fe00-4da2-a935-0a56f3dee5a5","block_type":"box","text":"agreements. In connection with these investments, a Fund makes cash contributions to a deposit fund of an","page_number":62,"box":{"x":69,"y":491,"width":773,"height":11}},{"id":"f61f4a11-8e3d-4813-bcd7-bcac30ccc48d","block_type":"box","text":"insurance company’s general account. The insurance company then credits to the Fund on a monthly basis","page_number":62,"box":{"x":70,"y":506,"width":761,"height":11}},{"id":"e67a9a32-6a31-47c1-aabb-9722cf2461de","block_type":"box","text":"guaranteed interest, which is based on an index. The funding agreements provide that this guaranteed interest will","page_number":62,"box":{"x":68,"y":521,"width":817,"height":11}},{"id":"3dd95933-099b-4522-afbd-3395278e16b0","block_type":"box","text":"not be less than a certain minimum rate. The purchase price paid for a funding agreement becomes part of the","page_number":62,"box":{"x":69,"y":536,"width":794,"height":11}},{"id":"4c8255b9-f7a6-455a-ae35-e51db8c62b79","block_type":"box","text":"general assets of the insurance company, and the contract is paid from the general assets of the insurance company.","page_number":62,"box":{"x":68,"y":551,"width":839,"height":11}},{"id":"eb4cd7ac-f920-437a-baa2-27575ead3a2d","block_type":"box","text":"Generally, funding agreements are not assignable or transferable without the permission of the issuing insurance","page_number":62,"box":{"x":69,"y":566,"width":806,"height":11}},{"id":"abf34b87-a292-42cb-94e2-e4f65ed115de","block_type":"box","text":"companies, and an active secondary market in some funding agreements does not currently exist.","page_number":62,"box":{"x":69,"y":581,"width":700,"height":12}},{"id":"1289537f-fb60-47b7-b87f-c6993ef76d2e","block_type":"box","text":"Guarantees.","page_number":62,"box":{"x":102,"y":604,"width":87,"height":9}},{"id":"a0ed7f53-b99c-4af6-8989-4ea947ae24b9","block_type":"box","text":"A Fund may purchase securities which contain guarantees issued by an entity separate from the","page_number":62,"box":{"x":194,"y":604,"width":685,"height":11}},{"id":"b53fb290-2098-40f3-9845-f69e9574d6ce","block_type":"box","text":"issuer of the security. 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The Manager will make investment changes to a Fund’s portfolio to accommodate cash flow","page_number":63,"box":{"x":70,"y":135,"width":810,"height":12}},{"id":"1730d72b-5e33-4d2b-bca2-9eda93da7957","block_type":"box","text":"while continuing to seek to replicate the total return of the Fund’s target index. 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A Fund may be subject to tracking error, which is the divergence of the Fund’s performance","page_number":63,"box":{"x":236,"y":249,"width":658,"height":11}},{"id":"c66c3de3-5a71-4d3e-a7e8-5f537b943cd3","block_type":"box","text":"from that of the Underlying Index. Tracking error may occur because of differences between the securities and other","page_number":63,"box":{"x":68,"y":264,"width":827,"height":11}},{"id":"6af36ab7-6225-4759-9fa2-7be4bb0ba98f","block_type":"box","text":"instruments held in the Fund’s portfolio and those included in the Underlying Index, pricing differences (including, as","page_number":63,"box":{"x":70,"y":279,"width":830,"height":11}},{"id":"30c29f59-d2a9-4109-907b-c068870e9ef1","block_type":"box","text":"applicable, differences between a security’s price at the local market close and the Fund’s valuation of a security at","page_number":63,"box":{"x":69,"y":294,"width":827,"height":11}},{"id":"90284fde-a48e-4563-beb2-b558d9e1a3a9","block_type":"box","text":"the time of calculation of the Fund’s net asset value), differences in transaction costs incurred by the Fund, the","page_number":63,"box":{"x":68,"y":309,"width":797,"height":11}},{"id":"92ed5870-7580-404a-91df-71e095772762","block_type":"box","text":"Fund’s holding of uninvested cash, differences in timing of the accrual of or the valuation of dividends or other","page_number":63,"box":{"x":70,"y":324,"width":787,"height":12}},{"id":"6bc935ce-fac7-4f95-b89c-df9af0098428","block_type":"box","text":"distributions, interest, the requirements to maintain pass-through tax treatment, portfolio transactions carried out to","page_number":63,"box":{"x":69,"y":339,"width":830,"height":12}},{"id":"827374fa-eb92-442b-9bfe-9baa027ca117","block_type":"box","text":"minimize the distribution of capital gains to shareholders, changes to the Underlying Index or the costs to the Fund of","page_number":63,"box":{"x":69,"y":355,"width":838,"height":11}},{"id":"9af60eb8-7308-4a6e-a62a-3a3668ecd8e1","block_type":"box","text":"complying with various new or existing regulatory requirements. 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A Fund may also invest in so-called “inverse floating obligations”","page_number":65,"box":{"x":69,"y":339,"width":837,"height":12}},{"id":"2cbc3621-537b-4506-8468-1eb29b8a8149","block_type":"box","text":"or “residual interest bonds” on which the interest rates vary inversely with a floating rate (which may be reset","page_number":65,"box":{"x":69,"y":355,"width":781,"height":11}},{"id":"8e9d24e5-5bcb-4987-a1c6-2506f41501f9","block_type":"box","text":"periodically by a Dutch auction, a remarketing agent, or by reference to a short-term tax-exempt interest rate index). A","page_number":65,"box":{"x":70,"y":370,"width":838,"height":11}},{"id":"e5bac57b-d5c8-4352-9e7d-bad3e51c2a62","block_type":"box","text":"Fund may purchase synthetically-created inverse floating rate bonds evidenced by custodial or trust receipts.","page_number":65,"box":{"x":70,"y":385,"width":771,"height":11}},{"id":"a041edd7-59d4-4a9f-a1b2-4c2610653e30","block_type":"box","text":"Generally, income on inverse floating rate bonds will decrease when interest rates increase, and will increase when","page_number":65,"box":{"x":69,"y":400,"width":820,"height":11}},{"id":"6c6a94e7-8411-424f-a609-11c3e0b420da","block_type":"box","text":"interest rates decrease. Such securities have the effect of providing a degree of investment leverage, since they may","page_number":65,"box":{"x":70,"y":415,"width":835,"height":11}},{"id":"e4e06858-f115-4495-a94a-5ca7dcdc55f2","block_type":"box","text":"increase or decrease in value in response to changes, as an illustration, in market interest rates at a rate that is a","page_number":65,"box":{"x":70,"y":430,"width":817,"height":11}},{"id":"c8c0c9a0-a1ae-4fe2-a5e0-8a54a69275b5","block_type":"box","text":"multiple of the rate at which fixed-rate securities increase or decrease in response to such changes. As a result, the","page_number":65,"box":{"x":69,"y":445,"width":829,"height":12}},{"id":"21970da6-55f5-4e17-a862-ac3cfb3915f9","block_type":"box","text":"market values of such securities will generally be more volatile than the market values of fixed-rate securities. To","page_number":65,"box":{"x":69,"y":460,"width":804,"height":12}},{"id":"b3d73d1c-951d-4345-90ba-97553aca9534","block_type":"box","text":"seek to limit the volatility of these securities, a Fund may purchase inverse floating obligations that have shorter-term","page_number":65,"box":{"x":69,"y":475,"width":838,"height":12}},{"id":"21ae4455-3954-44eb-b953-56a3746a8e79","block_type":"box","text":"maturities or that contain limitations on the extent to which the interest rate may vary. Certain investments in such","page_number":65,"box":{"x":69,"y":491,"width":819,"height":11}},{"id":"8fcdee14-92d2-4297-aa38-16f1ad75df3e","block_type":"box","text":"obligations may be illiquid. The Manager believes that indexed and inverse floating obligations represent flexible","page_number":65,"box":{"x":69,"y":506,"width":798,"height":11}},{"id":"31a092da-0f4e-4e42-8608-cf917b92c307","block_type":"box","text":"portfolio management instruments for a Fund that allow the Fund to seek potential investment rewards, hedge other","page_number":65,"box":{"x":70,"y":521,"width":829,"height":11}},{"id":"738f4c47-dfac-4f61-ad9f-f7c908692cd6","block_type":"box","text":"portfolio positions or vary the degree of investment leverage relatively efficiently under different market conditions. A","page_number":65,"box":{"x":70,"y":536,"width":834,"height":11}},{"id":"b4021d4b-4a7f-4051-bf0f-d0f9a29bf6ec","block_type":"box","text":"Fund may invest in indexed and inverse securities for hedging purposes or to seek to increase returns. When used for","page_number":65,"box":{"x":70,"y":551,"width":839,"height":11}},{"id":"668699d5-8134-4050-9313-bd99886699a6","block_type":"box","text":"hedging purposes, indexed and inverse securities involve correlation risk. Furthermore, where such a security","page_number":65,"box":{"x":69,"y":566,"width":781,"height":11}},{"id":"674cac15-97ed-4d2e-a946-13d681fe5a27","block_type":"box","text":"includes a contingent liability, in the event of an adverse movement in the underlying index or interest rate, a Fund","page_number":65,"box":{"x":70,"y":581,"width":812,"height":12}},{"id":"03d58b7e-be30-4938-afef-de67da9d4002","block_type":"box","text":"may be required to pay substantial additional margin to maintain the position.","page_number":65,"box":{"x":69,"y":597,"width":553,"height":11}},{"id":"e42fbfb9-7c4f-450b-822d-b62eedee5f1a","block_type":"box","text":"The Funds may invest up to 10% of their total assets in leveraged inverse floating rate debt instruments","page_number":65,"box":{"x":101,"y":619,"width":741,"height":11}},{"id":"abb88786-33a0-46ed-bf95-7be1214b6fcc","block_type":"box","text":"(“inverse floaters”). Inverse floaters are securities the potential of which is inversely related to changes in interest","page_number":65,"box":{"x":69,"y":634,"width":815,"height":12}},{"id":"d69f9172-39e9-4a0e-932c-a4235d94e2a4","block_type":"box","text":"rates. In general, the return on inverse floaters will decrease when short-term interest rates increase and increase","page_number":65,"box":{"x":69,"y":649,"width":817,"height":12}},{"id":"e84e4633-116e-4bea-9309-965b57644481","block_type":"box","text":"when short-term rates decrease. Municipal tender option bonds, both taxable and tax-exempt, which may include","page_number":65,"box":{"x":68,"y":665,"width":805,"height":11}},{"id":"915b0c8f-2fa6-4d03-8d42-0a02e0db6e9e","block_type":"box","text":"inverse floating rate debt instruments, (including residual interests thereon) are excluded from this 10% limitation.","page_number":65,"box":{"x":70,"y":680,"width":813,"height":11}},{"id":"657366f3-e8c8-40b4-8391-61befe2493d5","block_type":"box","text":"Inflation Risk.","page_number":65,"box":{"x":102,"y":702,"width":100,"height":9}},{"id":"4279b8c8-07ae-48b4-82a4-3d676c85ec5d","block_type":"box","text":"Like all funds, the Funds are subject to inflation risk. Inflation risk is the risk that the present","page_number":65,"box":{"x":209,"y":702,"width":663,"height":11}},{"id":"3323771c-e71d-4ac4-a4df-10f748e150a3","block_type":"box","text":"value of assets or income from investments will be less in the future as inflation decreases the value of money. As","page_number":65,"box":{"x":68,"y":717,"width":820,"height":12}},{"id":"e48df434-b099-4948-8c42-32f594c8cdcd","block_type":"box","text":"inflation increases, the present value of a Fund’s assets can decline as can the value of a Fund’s distributions.","page_number":65,"box":{"x":70,"y":732,"width":792,"height":11}},{"id":"93b48c96-cc0e-4774-a3c6-f52ed6a0eacd","block_type":"box","text":"Inflation rates may change frequently and significantly due to a number of potential factors, including, among others,","page_number":65,"box":{"x":70,"y":748,"width":829,"height":11}},{"id":"706bf11e-9999-4c5c-872d-90df6bebb535","block_type":"box","text":"unexpected economic shifts or changes in fiscal or monetary policies.","page_number":65,"box":{"x":69,"y":763,"width":497,"height":11}},{"id":"4260f2f0-67c8-4262-9dce-fdb66547e220","block_type":"box","text":"Initial Public Offering (“IPO”) Risk.","page_number":65,"box":{"x":102,"y":785,"width":253,"height":12}},{"id":"5747813c-8331-4efa-8b5d-1fb7309fd0e4","block_type":"box","text":"The volume of IPOs and the levels at which the newly issued stocks trade in","page_number":65,"box":{"x":361,"y":785,"width":540,"height":12}},{"id":"e998ac24-8d78-4dc4-bd12-72ab7c2fcc51","block_type":"box","text":"the secondary market are affected by the performance of the stock market overall. If IPOs are brought to the market,","page_number":65,"box":{"x":68,"y":801,"width":836,"height":11}},{"id":"3ef0f7c3-d522-4b24-94ce-c4449c7759e5","block_type":"box","text":"availability may be limited and a Fund may not be able to buy any shares at the offering price, or if it is able to buy","page_number":65,"box":{"x":69,"y":816,"width":815,"height":11}},{"id":"dc481ba8-7f22-4fb6-ace9-20bbd72dfcdd","block_type":"box","text":"shares, it may not be able to buy as many shares at the offering price as it would like. In addition, the prices of","page_number":65,"box":{"x":69,"y":831,"width":795,"height":11}},{"id":"1777761b-7667-44dd-9f20-13938f6bff5f","block_type":"box","text":"securities involved in IPOs are often subject to greater and more unpredictable price changes than more established","page_number":65,"box":{"x":69,"y":846,"width":829,"height":11}},{"id":"7eedfd19-d3ab-4908-a7e2-7853d07568e1","block_type":"box","text":"stocks. IPOs have the potential to produce substantial gains. A Fund may hold shares from an IPO for only a short","page_number":65,"box":{"x":69,"y":861,"width":814,"height":11}},{"id":"36e0b3a9-dc47-4271-bca1-5f7d4674d898","block_type":"box","text":"period of time given possible price volatility. This may result in increased portfolio turnover and expenses, such as","page_number":65,"box":{"x":70,"y":876,"width":813,"height":11}},{"id":"53e3b56b-2a34-45db-beb2-9ad3eb8a9c6e","block_type":"box","text":"commissions and transaction costs, and potentially result in taxable gains that the Fund will subsequently distribute","page_number":65,"box":{"x":69,"y":891,"width":828,"height":12}},{"id":"84660191-c7f4-4df0-8a8f-b2f6f21d7c50","block_type":"box","text":"to shareholders. There is no assurance that any Fund will have access to profitable IPOs and therefore investors","page_number":65,"box":{"x":68,"y":906,"width":802,"height":12}},{"id":"903c5bd5-6dc8-435e-8d0e-b29b9f2cc1a7","block_type":"box","text":"II-34","page_number":65,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"af8142b9-1322-4b1a-9868-15e587cc9b1f","block_type":"box","text":"NM0926U-5977317-65/232","page_number":65,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"28398964-2cb9-42ff-a242-acb35d7a3626","block_type":"box","text":"should not rely on any past gains from IPOs as an indication of future performance. The investment performance of a","page_number":66,"box":{"x":69,"y":45,"width":837,"height":11}},{"id":"7b9aa8d0-f61a-427d-b0a5-89c7de47d5d9","block_type":"box","text":"Fund during periods when it is unable to invest significantly or at all in IPOs may be lower than during periods when it","page_number":66,"box":{"x":70,"y":60,"width":832,"height":11}},{"id":"ea813d1f-dea2-4c58-abf7-5749e86cfdde","block_type":"box","text":"is able to do so. In addition, as a Fund increases in size, the impact of IPOs on its performance will generally","page_number":66,"box":{"x":70,"y":75,"width":777,"height":11}},{"id":"1f6b35c5-92e6-4796-8e9a-a60a6a906a7b","block_type":"box","text":"decrease. Securities issued in IPOs are subject to many of the same risks as investing in companies with smaller","page_number":66,"box":{"x":69,"y":90,"width":810,"height":11}},{"id":"4c9de5fe-3a3f-4d8b-afe6-8bdf8e6affe4","block_type":"box","text":"market capitalizations. Securities issued in IPOs have no trading history, and information about the companies may","page_number":66,"box":{"x":69,"y":105,"width":823,"height":11}},{"id":"9efd9531-5cd8-4bd3-9759-e64e7d8e1b3c","block_type":"box","text":"be available for very limited periods.","page_number":66,"box":{"x":69,"y":120,"width":257,"height":11}},{"id":"e51e9d97-1d82-495d-b47b-c926dbd60ff4","block_type":"box","text":"Investment in Emerging Markets.","page_number":66,"box":{"x":102,"y":143,"width":242,"height":11}},{"id":"ed6ba5e7-4e19-46b4-bf16-0b0ebda2d61b","block_type":"box","text":"General.","page_number":66,"box":{"x":102,"y":166,"width":58,"height":9}},{"id":"b2181a4d-9201-4bf1-a833-12c0dec3ae77","block_type":"box","text":"Certain Funds may invest in the securities of issuers domiciled in various countries with emerging capital","page_number":66,"box":{"x":102,"y":188,"width":748,"height":12}},{"id":"dfc6716f-d67c-4d71-859f-d1e56abedf95","block_type":"box","text":"markets. Unless otherwise provided in a Fund’s Prospectus, a country with an emerging capital market is any country","page_number":66,"box":{"x":69,"y":204,"width":840,"height":11}},{"id":"837af859-e97b-434e-add7-4143f840dff7","block_type":"box","text":"that is (i) generally recognized to be an emerging market country by the international financial community, such as","page_number":66,"box":{"x":68,"y":218,"width":813,"height":12}},{"id":"0fcd115c-64cc-4696-aa89-19831bda5ac1","block_type":"box","text":"the International Finance Corporation, or determined by the World Bank to have a low, middle or middle upper income","page_number":66,"box":{"x":68,"y":234,"width":836,"height":11}},{"id":"23e85ce3-23cf-4c95-b8de-3a07b5ac04d4","block_type":"box","text":"economy; (ii) classified by the United Nations or its authorities to be developing; and/or (iii) included in a broad-based","page_number":66,"box":{"x":69,"y":249,"width":839,"height":11}},{"id":"9b8b4eb6-15ad-4452-a1e6-95f5a069c29b","block_type":"box","text":"index that is generally representative of emerging markets. Countries with emerging markets can be found in regions","page_number":66,"box":{"x":70,"y":264,"width":831,"height":11}},{"id":"90805dd9-4641-4e05-9fb4-4fb6e698d3ee","block_type":"box","text":"such as Asia, Latin America, Eastern Europe and Africa.","page_number":66,"box":{"x":69,"y":279,"width":396,"height":11}},{"id":"ed0764f6-b79d-4cbe-9aa4-e5ebb75053e1","block_type":"box","text":"Investments in the securities of issuers domiciled in countries with emerging capital markets involve certain","page_number":66,"box":{"x":102,"y":302,"width":770,"height":11}},{"id":"d81f00fd-0783-4b4e-8c4c-730e5f9b3631","block_type":"box","text":"additional risks that do not generally apply to investments in securities of issuers in more developed capital markets,","page_number":66,"box":{"x":69,"y":317,"width":835,"height":11}},{"id":"8299d613-9492-4325-9181-b9fdd1fb8a5a","block_type":"box","text":"such as (i) low or non-existent trading volume, resulting in market illiquidity and increased volatility in prices for such","page_number":66,"box":{"x":69,"y":332,"width":828,"height":11}},{"id":"ef192ed0-a01f-487e-8487-cf74fc3535d2","block_type":"box","text":"securities, as compared to securities of comparable issuers in more developed capital markets; (ii) uncertain","page_number":66,"box":{"x":69,"y":347,"width":779,"height":11}},{"id":"00e0b7be-c4d4-42e9-89ef-a3be825f5337","block_type":"box","text":"national policies and social, political and economic instability, increasing the potential for expropriation of assets,","page_number":66,"box":{"x":69,"y":362,"width":809,"height":11}},{"id":"1087939d-1b29-4f1e-af85-f76239c7b6bd","block_type":"box","text":"confiscatory taxation, high rates of inflation or unfavorable diplomatic developments; (iii) possible fluctuations in","page_number":66,"box":{"x":69,"y":377,"width":800,"height":12}},{"id":"67270863-3452-4a35-bdf7-acb4fc89dfc7","block_type":"box","text":"exchange rates, differing legal systems and the existence or possible imposition of exchange controls, custodial","page_number":66,"box":{"x":69,"y":392,"width":800,"height":12}},{"id":"82412270-3c38-4b12-9ab3-5cbe9692b1dc","block_type":"box","text":"restrictions or other foreign or U.S. Governmental laws or restrictions applicable to such investments; (iv) national","page_number":66,"box":{"x":69,"y":407,"width":811,"height":12}},{"id":"5bfd8116-5ba6-47a3-ab36-993134e5010e","block_type":"box","text":"policies that may limit a Fund’s investment opportunities such as restrictions on investment in issuers or industries","page_number":66,"box":{"x":70,"y":423,"width":824,"height":11}},{"id":"2b3d6d32-52f6-40f6-921d-8f3a08aeb3b2","block_type":"box","text":"deemed sensitive to national interests; and (v) the lack or relatively early development of legal structures governing","page_number":66,"box":{"x":69,"y":438,"width":823,"height":11}},{"id":"b45b1ea3-e205-4d2c-8596-6eb3996630c4","block_type":"box","text":"private and foreign investments and private property. In addition to withholding taxes on investment income, some","page_number":66,"box":{"x":70,"y":453,"width":813,"height":11}},{"id":"fbcd20dd-f39b-45f7-821b-1848c5d7fdd9","block_type":"box","text":"countries with emerging markets may impose differential capital gains taxes on foreign investors.","page_number":66,"box":{"x":69,"y":468,"width":694,"height":11}},{"id":"05896183-972d-4e9d-81c1-a80beb07e6e1","block_type":"box","text":"Political and economic structures in emerging market countries may be undergoing significant evolution and","page_number":66,"box":{"x":102,"y":491,"width":767,"height":11}},{"id":"d1066e0e-0802-4879-b614-0ee4ce0b9fc2","block_type":"box","text":"rapid development, and these countries may lack the social, political and economic stability characteristic of more","page_number":66,"box":{"x":69,"y":506,"width":814,"height":11}},{"id":"f1006945-0234-4aa6-98d6-c9708a1e0927","block_type":"box","text":"developed countries. In such a dynamic environment, there can be no assurance that any or all of these capital","page_number":66,"box":{"x":69,"y":521,"width":792,"height":11}},{"id":"d4d51322-2abd-4733-9e08-e30baebf50eb","block_type":"box","text":"markets will continue to present viable investment opportunities for a Fund. In the past, governments of such nations","page_number":66,"box":{"x":69,"y":536,"width":838,"height":11}},{"id":"8b2a8bf8-7d1f-4a63-8f59-7d64be476771","block_type":"box","text":"have expropriated substantial amounts of private property, and most claims of the property owners have never been","page_number":66,"box":{"x":69,"y":551,"width":828,"height":11}},{"id":"c348453a-13bb-4867-ae55-03eaa99570f6","block_type":"box","text":"fully settled. There is no assurance that such expropriations will not reoccur. In such an event, it is possible that a","page_number":66,"box":{"x":68,"y":566,"width":816,"height":11}},{"id":"91ae5d64-1b9b-4454-8f59-8f55998d3e04","block_type":"box","text":"Fund could lose the entire value of its investments in the affected market. As a result the risks described above,","page_number":66,"box":{"x":70,"y":581,"width":802,"height":11}},{"id":"7b2f0385-9090-4097-8fe6-039895fe38cb","block_type":"box","text":"including the risks of nationalization or expropriation of assets, may be heightened. In addition, unanticipated political","page_number":66,"box":{"x":70,"y":596,"width":838,"height":12}},{"id":"cd36a075-5106-421a-aead-527821ac74ac","block_type":"box","text":"or social developments may affect the value of investments in these countries and the availability to a Fund of","page_number":66,"box":{"x":69,"y":612,"width":788,"height":11}},{"id":"6efb49b4-60ba-4ede-9233-d0e054821b06","block_type":"box","text":"additional investments. The small size and inexperience of the securities markets in certain of these countries and","page_number":66,"box":{"x":69,"y":627,"width":819,"height":11}},{"id":"cc598676-f2a9-412a-bcc1-cb4e318f9bbe","block_type":"box","text":"the limited volume of trading in securities in these countries may make investments in the countries illiquid and more","page_number":66,"box":{"x":68,"y":642,"width":838,"height":11}},{"id":"9e839610-8522-471c-914c-a2c26dae7753","block_type":"box","text":"volatile than investments in more established markets.","page_number":66,"box":{"x":68,"y":657,"width":392,"height":9}},{"id":"a70b7989-0aff-4580-8847-5036b35155e4","block_type":"box","text":"Also, there may be less publicly available information about issuers in emerging markets than would be available","page_number":66,"box":{"x":101,"y":680,"width":805,"height":11}},{"id":"a04a7315-3c4f-4f3e-97fc-dbd2d1a08a8c","block_type":"box","text":"about issuers in more developed capital markets, and such issuers may not be subject to accounting, auditing and","page_number":66,"box":{"x":69,"y":695,"width":818,"height":11}},{"id":"11664426-ad77-41a6-b35a-846630f3c3b6","block_type":"box","text":"financial reporting standards and requirements comparable to those to which U.S. companies are subject. In certain","page_number":66,"box":{"x":68,"y":710,"width":831,"height":11}},{"id":"17e6739b-8f4a-4ac2-b889-65b7d189b9c2","block_type":"box","text":"countries with emerging capital markets, reporting standards vary widely. As a result, traditional investment","page_number":66,"box":{"x":69,"y":725,"width":768,"height":11}},{"id":"6538247e-4027-4514-9259-9f641d49d0e0","block_type":"box","text":"measurements used in the United States, such as price/earnings ratios, may not be applicable. Emerging market","page_number":66,"box":{"x":69,"y":740,"width":811,"height":11}},{"id":"1b1160a9-c660-42ad-8d20-dd57ffbfa4fa","block_type":"box","text":"securities may be substantially less liquid than, and more volatile than, those of mature markets, and company","page_number":66,"box":{"x":69,"y":755,"width":795,"height":11}},{"id":"2d5c7926-1c9b-48dd-96e9-d449a89f2f3a","block_type":"box","text":"shares may be held by a limited number of persons. This may adversely affect the timing and pricing of the Fund’s","page_number":66,"box":{"x":69,"y":770,"width":814,"height":12}},{"id":"4f9a29a0-d3c0-4bb4-9aac-d4b04a27f377","block_type":"box","text":"acquisition or disposal of securities.","page_number":66,"box":{"x":69,"y":785,"width":257,"height":11}},{"id":"76b2c554-629b-48a5-b4ce-350d0d604c6c","block_type":"box","text":"Practices in relation to settlement of securities transactions in emerging markets involve higher risks than those","page_number":66,"box":{"x":102,"y":808,"width":800,"height":11}},{"id":"7c5a23a4-6da0-497d-a55e-bd98e61f1606","block_type":"box","text":"in developed markets, in part because a Fund will need to use brokers and counterparties that are less well","page_number":66,"box":{"x":70,"y":823,"width":769,"height":11}},{"id":"cf8ba867-6123-4a9a-a0ea-69d841944ba5","block_type":"box","text":"capitalized, and custody and registration of assets in some countries may be unreliable. The possibility of fraud,","page_number":66,"box":{"x":69,"y":838,"width":798,"height":12}},{"id":"56431d64-d001-4d22-965a-37500f6a895e","block_type":"box","text":"negligence, undue influence being exerted by the issuer or refusal to recognize ownership exists in some emerging","page_number":66,"box":{"x":69,"y":853,"width":819,"height":12}},{"id":"12982e10-d334-4a98-b485-735e343b4e1c","block_type":"box","text":"markets, and, along with other factors, could result in ownership registration being completely lost. A Fund would","page_number":66,"box":{"x":69,"y":869,"width":804,"height":11}},{"id":"8019a711-77fd-425c-ab35-2bcce0537b74","block_type":"box","text":"absorb any loss resulting from such registration problems and may have no successful claim for compensation.","page_number":66,"box":{"x":69,"y":884,"width":794,"height":11}},{"id":"e9528f2c-d93a-4bfd-a96d-f1f36e46c891","block_type":"box","text":"II-35","page_number":66,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"1f585576-d1e8-4a67-b082-ae077db58efa","block_type":"box","text":"NM0926U-5977317-66/232","page_number":66,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"ebc3f8a9-1931-4e7f-8298-d75c63fcbe8d","block_type":"box","text":"Investment in non-dollar denominated securities including securities from issuers located in emerging market","page_number":67,"box":{"x":102,"y":45,"width":778,"height":11}},{"id":"ba967043-e8af-4bc3-9b98-cfbdd70907f8","block_type":"box","text":"countries may be on either a currency hedged or unhedged basis, and the Funds may hold from time to time various","page_number":67,"box":{"x":69,"y":60,"width":827,"height":11}},{"id":"8a17a713-6cd9-49e6-94c5-5af4f51b324b","block_type":"box","text":"foreign currencies pending investment or conversion into U.S. dollars. Some of these instruments may have the","page_number":67,"box":{"x":68,"y":75,"width":797,"height":11}},{"id":"d24526e2-3c74-4c87-89c3-033bfc9e4dc0","block_type":"box","text":"characteristics of futures contracts. In addition, certain Funds may engage in foreign currency exchange transactions","page_number":67,"box":{"x":69,"y":90,"width":832,"height":11}},{"id":"0247885a-2fea-4d02-9999-5bd19d30ec0d","block_type":"box","text":"to seek to protect against changes in the level of future exchange rates which would adversely affect the Fund’s","page_number":67,"box":{"x":68,"y":105,"width":799,"height":11}},{"id":"09598e8b-cd9e-4a63-abdc-8b81fd0acd7f","block_type":"box","text":"performance. These investments and transactions involving foreign securities, currencies, options (including options","page_number":67,"box":{"x":70,"y":120,"width":829,"height":12}},{"id":"8d43061e-d3c4-4a65-9d6a-299a27ac866a","block_type":"box","text":"that relate to foreign currencies), futures, hedging and cross-hedging are described under “Derivatives.”","page_number":67,"box":{"x":68,"y":135,"width":740,"height":12}},{"id":"ed0349bf-f2e5-4597-bd23-8ee01982bacb","block_type":"box","text":"Risks of Investing in Asia-Pacific Countries.","page_number":67,"box":{"x":102,"y":158,"width":305,"height":11}},{"id":"a7f6dda5-9b93-4905-9451-527befbda8ee","block_type":"box","text":"In addition to the risks of foreign investing and the risks of investing","page_number":67,"box":{"x":414,"y":158,"width":485,"height":11}},{"id":"00c851c6-c610-49d8-adac-fddb27da7382","block_type":"box","text":"in developing markets, the developing market Asia-Pacific countries in which a Fund may invest are subject to certain","page_number":67,"box":{"x":70,"y":173,"width":832,"height":11}},{"id":"6a635243-5e46-480a-9a1f-8312795dff8a","block_type":"box","text":"additional or specific risks. Certain Funds may make substantial investments in Asia-Pacific countries. In many of","page_number":67,"box":{"x":69,"y":188,"width":808,"height":11}},{"id":"617b3cd9-1bcd-43bf-a08f-354d2b9d7fe8","block_type":"box","text":"these markets, there is a high concentration of market capitalization and trading volume in a small number of issuers","page_number":67,"box":{"x":68,"y":203,"width":838,"height":12}},{"id":"1283a2ca-69e8-4656-aa18-d6d11b2f011d","block_type":"box","text":"representing a limited number of industries, as well as a high concentration of investors and financial intermediaries.","page_number":67,"box":{"x":69,"y":218,"width":834,"height":12}},{"id":"26cbac9e-bd16-4be4-88c9-d6ace7130da7","block_type":"box","text":"Many of these markets also may be affected by developments with respect to more established markets in the","page_number":67,"box":{"x":70,"y":234,"width":791,"height":11}},{"id":"c9eff488-5845-4506-b8e4-27333bb29e8f","block_type":"box","text":"region such as in Japan and Hong Kong. Brokers in developing market Asia-Pacific countries typically are fewer in","page_number":67,"box":{"x":69,"y":249,"width":804,"height":11}},{"id":"f14e0956-c71d-41b1-a4d4-6152556ef78e","block_type":"box","text":"number and less well capitalized than brokers in the United States. These factors, combined with the U.S. regulatory","page_number":67,"box":{"x":69,"y":264,"width":833,"height":11}},{"id":"a14917b8-3aa2-412f-9cdd-95d4e6ceec3e","block_type":"box","text":"requirements for open-end investment companies and the restrictions on foreign investment discussed below, result","page_number":67,"box":{"x":69,"y":279,"width":830,"height":11}},{"id":"0a7b7b77-ce40-421a-95d2-932afb9435c5","block_type":"box","text":"in potentially fewer investment opportunities for a Fund and may have an adverse impact on the investment","page_number":67,"box":{"x":70,"y":294,"width":766,"height":11}},{"id":"0897b763-487b-4630-84c4-895bd466e69d","block_type":"box","text":"performance of the Fund.","page_number":67,"box":{"x":70,"y":309,"width":179,"height":11}},{"id":"785df1c2-3da1-4e74-a9d4-4d12eb7bcdb2","block_type":"box","text":"Many of the developing market Asia-Pacific countries may be subject to a greater degree of economic, political","page_number":67,"box":{"x":102,"y":332,"width":784,"height":11}},{"id":"2e4674d0-6882-4e2a-9f72-466b5d0bbb2a","block_type":"box","text":"and social instability than is the case in the United States and Western European countries. Such instability may","page_number":67,"box":{"x":69,"y":347,"width":803,"height":11}},{"id":"95566d8e-7606-441a-b657-ab3598f291ff","block_type":"box","text":"result from, among other things: (i) authoritarian governments or military involvement in political and economic","page_number":67,"box":{"x":69,"y":362,"width":788,"height":11}},{"id":"019bfa4d-b68b-4c94-b2f7-fc00dea906c0","block_type":"box","text":"decision-making, including changes in government through extra-constitutional means; (ii) popular unrest associated","page_number":67,"box":{"x":69,"y":377,"width":827,"height":12}},{"id":"f773b0a9-4243-4a02-8250-7c69bace2c7b","block_type":"box","text":"with demands for improved political, economic and social conditions; (iii) internal insurgencies; (iv) hostile relations","page_number":67,"box":{"x":68,"y":392,"width":823,"height":12}},{"id":"0c454c23-3638-4008-a41a-7bb10e332742","block_type":"box","text":"with neighboring countries; and (v) ethnic, religious and racial disaffection. In addition, the governments of many of","page_number":67,"box":{"x":68,"y":407,"width":822,"height":12}},{"id":"b66395bf-7c21-48bd-9c4d-14c4a4c3943d","block_type":"box","text":"such countries, such as Indonesia, have a substantial role in regulating and supervising the economy. Another risk","page_number":67,"box":{"x":69,"y":423,"width":818,"height":11}},{"id":"9e11ff97-01b5-48b7-b447-a5a4fa5395d6","block_type":"box","text":"common to most such countries is that the economy is heavily export oriented and, accordingly, is dependent upon","page_number":67,"box":{"x":69,"y":438,"width":821,"height":11}},{"id":"58221957-1607-4a19-b66c-963e6706bd3d","block_type":"box","text":"international trade. The existence of overburdened infrastructure and obsolete financial systems also presents risks","page_number":67,"box":{"x":70,"y":453,"width":827,"height":11}},{"id":"27a8a54f-ca46-4bf5-b069-8f80f890e6f3","block_type":"box","text":"in certain countries, as do environmental problems. Certain economies also depend to a significant degree upon","page_number":67,"box":{"x":70,"y":468,"width":803,"height":11}},{"id":"11b2e4a3-8c1f-4476-91f5-f99e2d35e8a6","block_type":"box","text":"exports of primary commodities and, therefore, are vulnerable to changes in commodity prices that, in turn, may be","page_number":67,"box":{"x":69,"y":483,"width":824,"height":11}},{"id":"dfb35adf-9a58-4225-8a21-778d77b8c6ac","block_type":"box","text":"affected by a variety of factors.","page_number":67,"box":{"x":69,"y":498,"width":220,"height":11}},{"id":"b5412168-c14a-49c0-bf13-d4291fe507e9","block_type":"box","text":"The legal systems in certain developing market Asia-Pacific countries also may have an adverse impact on the","page_number":67,"box":{"x":101,"y":521,"width":785,"height":11}},{"id":"74e43c4e-5a9b-4466-8bf9-5b3f3e7206c9","block_type":"box","text":"Fund. For example, while the potential liability of a shareholder in a U.S. corporation with respect to acts of the","page_number":67,"box":{"x":70,"y":536,"width":789,"height":11}},{"id":"70fab6ce-db40-4022-b9fd-18af94adae70","block_type":"box","text":"corporation is generally limited to the amount of the shareholder’s investment, the notion of limited liability is less","page_number":67,"box":{"x":69,"y":551,"width":814,"height":11}},{"id":"f5d69036-13c4-41a4-a5e6-18fbe700345a","block_type":"box","text":"clear in certain emerging market Asia-Pacific countries. Similarly, the rights of investors in developing market Asia","page_number":67,"box":{"x":69,"y":566,"width":813,"height":11}},{"id":"ca3d1ff2-bf98-440a-84f0-c46158032e0c","block_type":"box","text":"Pacific companies may be more limited than those of shareholders of U.S. corporations. It may be difficult or","page_number":67,"box":{"x":69,"y":581,"width":777,"height":11}},{"id":"0ffa9abb-723d-4116-9f24-05cca8f5d448","block_type":"box","text":"impossible to obtain and/or enforce a judgment in a developing market Asia-Pacific country.","page_number":67,"box":{"x":70,"y":596,"width":652,"height":12}},{"id":"018dfe41-6a88-4ce7-9c7c-ccdcdc1c31b7","block_type":"box","text":"Governments of many developing market Asia-Pacific countries have exercised and continue to exercise","page_number":67,"box":{"x":102,"y":619,"width":737,"height":11}},{"id":"db5c03f0-c426-4a0c-8211-3f32c5329a81","block_type":"box","text":"substantial influence over many aspects of the private sector. In certain cases, the government owns or controls","page_number":67,"box":{"x":69,"y":634,"width":803,"height":12}},{"id":"457cf220-c07f-4673-b216-3187b6dab42d","block_type":"box","text":"many companies, including the largest in the country. Accordingly, government actions in the future could have a","page_number":67,"box":{"x":69,"y":649,"width":801,"height":12}},{"id":"e212b0bd-1b4f-4bdf-9191-8fea9862b7de","block_type":"box","text":"significant effect on economic conditions in developing market Asia-Pacific countries, which could affect private","page_number":67,"box":{"x":69,"y":664,"width":793,"height":12}},{"id":"d9c447c9-98bf-4baf-9cd6-281c625630cc","block_type":"box","text":"sector companies and a Fund itself, as well as the value of securities in the Fund’s portfolio. In addition, economic","page_number":67,"box":{"x":69,"y":680,"width":820,"height":11}},{"id":"3176fe7c-b3f2-4d3f-b3b0-89a6ae03201a","block_type":"box","text":"statistics of developing market Asia-Pacific countries may be less reliable than economic statistics of more developed","page_number":67,"box":{"x":69,"y":695,"width":839,"height":11}},{"id":"782519a1-d060-401b-863d-b3b8e26c7fe5","block_type":"box","text":"nations.","page_number":67,"box":{"x":69,"y":710,"width":56,"height":9}},{"id":"63ce0042-0e62-4567-b476-9a0cb8aff2ac","block_type":"box","text":"In addition to the relative lack of publicly available information about developing market Asia-Pacific issuers and","page_number":67,"box":{"x":102,"y":732,"width":794,"height":12}},{"id":"39a3e2be-6b09-4b78-9be3-b7dc1fd2ad85","block_type":"box","text":"the possibility that such issuers may not be subject to the same accounting, auditing and financial reporting","page_number":67,"box":{"x":68,"y":748,"width":773,"height":11}},{"id":"a30c9347-42c6-42b7-9597-9a747b4b2ed8","block_type":"box","text":"standards as U.S. companies, inflation accounting rules in some developing market Asia-Pacific countries require","page_number":67,"box":{"x":69,"y":763,"width":808,"height":11}},{"id":"6e3f7106-7721-45e2-b694-85658be48df2","block_type":"box","text":"companies that keep accounting records in the local currency, for both tax and accounting purposes, to restate","page_number":67,"box":{"x":69,"y":778,"width":791,"height":11}},{"id":"cc8a1fe8-0321-4d24-828d-1a461e7635f4","block_type":"box","text":"certain assets and liabilities on the company’s balance sheet in order to express items in terms of currency of","page_number":67,"box":{"x":69,"y":793,"width":790,"height":11}},{"id":"60765c48-3eab-468e-ac11-22b28f21349b","block_type":"box","text":"constant purchasing power. Inflation accounting may indirectly generate losses or profits for certain developing","page_number":67,"box":{"x":69,"y":808,"width":790,"height":11}},{"id":"15769131-c48d-47c3-9f66-91437bd94a01","block_type":"box","text":"market Asia-Pacific companies.","page_number":67,"box":{"x":69,"y":823,"width":220,"height":11}},{"id":"4218ab6d-e3d2-4962-8e2e-6378f3a23e98","block_type":"box","text":"Satisfactory custodial services for investment securities may not be available in some developing Asia-Pacific","page_number":67,"box":{"x":102,"y":846,"width":780,"height":11}},{"id":"352334e2-b826-46eb-9915-a2a82b18fe54","block_type":"box","text":"countries, which may result in the Fund incurring additional costs and delays in providing transportation and custody","page_number":67,"box":{"x":69,"y":861,"width":829,"height":11}},{"id":"a4196a93-9a35-4f96-912e-3a06185df18a","block_type":"box","text":"services for such securities outside such countries.","page_number":67,"box":{"x":69,"y":876,"width":367,"height":9}},{"id":"eb9b832d-72dc-4faf-b24a-9cc022ddc892","block_type":"box","text":"II-36","page_number":67,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"704acf41-d523-43b7-a8df-13f45a118a97","block_type":"box","text":"NM0926U-5977317-67/232","page_number":67,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"ac256ddc-cb7e-4fea-b739-94e08c2f942e","block_type":"box","text":"Certain developing Asia-Pacific countries, such as the Philippines, India and Turkey, are especially large debtors","page_number":68,"box":{"x":102,"y":45,"width":795,"height":11}},{"id":"7c78c9f5-75fc-4950-a249-f0e1a0f98494","block_type":"box","text":"to commercial banks and foreign governments.","page_number":68,"box":{"x":68,"y":60,"width":335,"height":11}},{"id":"a4a78f8f-0e5f-4302-b82e-c3f0978adf91","block_type":"box","text":"Natural disasters in Asia-Pacific countries, and the resulting damage, could have a severe and negative impact","page_number":68,"box":{"x":102,"y":82,"width":788,"height":12}},{"id":"fff683a2-1966-4d5f-af9e-605b3005dcf2","block_type":"box","text":"on a Fund’s investment portfolio and, in the longer term, could impair the ability of issuers in which the Fund invests","page_number":68,"box":{"x":69,"y":98,"width":830,"height":11}},{"id":"ffc3a652-88f1-47f1-85dd-15e364edb6fa","block_type":"box","text":"to conduct their businesses in the manner normally conducted.","page_number":68,"box":{"x":68,"y":113,"width":450,"height":11}},{"id":"62ddfbd1-5387-4bfd-895a-103901c33118","block_type":"box","text":"Fund management may determine that, notwithstanding otherwise favorable investment criteria, it may not be","page_number":68,"box":{"x":102,"y":135,"width":782,"height":12}},{"id":"83cc1db9-5c76-4e15-b787-9922eac60f9f","block_type":"box","text":"practicable or appropriate to invest in a particular developing Asia-Pacific country. A Fund may invest in countries in","page_number":68,"box":{"x":70,"y":150,"width":819,"height":12}},{"id":"768c1466-c9f7-4b79-812f-dece9ac4914e","block_type":"box","text":"which foreign investors, including management of the Fund, have had no or limited prior experience.","page_number":68,"box":{"x":68,"y":166,"width":711,"height":11}},{"id":"11c249c5-5125-4be3-a576-34282f4ef415","block_type":"box","text":"Restrictions on Foreign Investments in Asia-Pacific Countries.","page_number":68,"box":{"x":102,"y":188,"width":435,"height":12}},{"id":"fad6afc0-0a45-4587-9135-dd521f3c61fd","block_type":"box","text":"Some developing Asia-Pacific countries prohibit or","page_number":68,"box":{"x":543,"y":188,"width":355,"height":12}},{"id":"7656e4d4-eed0-4309-9676-6baaa5b08922","block_type":"box","text":"impose substantial restrictions on investments in their capital markets, particularly their equity markets, by foreign","page_number":68,"box":{"x":70,"y":203,"width":817,"height":12}},{"id":"2ad4302e-fbb6-4c2b-8a43-43c2823d8c3b","block_type":"box","text":"entities such as a Fund. As illustrations, certain countries may require governmental approval prior to investments by","page_number":68,"box":{"x":69,"y":219,"width":836,"height":11}},{"id":"1f2c6c2d-a154-45e9-b32e-adf941ab7a5e","block_type":"box","text":"foreign persons or limit the amount of investment by foreign persons in a particular company or limit the investment","page_number":68,"box":{"x":68,"y":234,"width":828,"height":11}},{"id":"bd8725fb-aa26-4e9d-9faf-1a135bf9f5da","block_type":"box","text":"by foreign persons to only a specific class of securities of a company which may have less advantageous terms","page_number":68,"box":{"x":69,"y":249,"width":794,"height":11}},{"id":"3c7bdf46-13d7-493e-9a11-de88d533b435","block_type":"box","text":"(including price and shareholder rights) than securities of the company available for purchase by nationals. There can","page_number":68,"box":{"x":69,"y":264,"width":835,"height":11}},{"id":"a79595c3-1803-4dfe-8a4b-80dd8cb0aa98","block_type":"box","text":"be no assurance that a Fund will be able to obtain required governmental approvals in a timely manner. In addition,","page_number":68,"box":{"x":69,"y":279,"width":820,"height":11}},{"id":"6e06c9bd-153a-496f-a9d0-e181b86fba01","block_type":"box","text":"changes to restrictions on foreign ownership of securities subsequent to a Fund’s purchase of such securities may","page_number":68,"box":{"x":69,"y":294,"width":820,"height":11}},{"id":"e1870e7a-ca53-4b71-8478-5299c54dd5d3","block_type":"box","text":"have an adverse effect on the value of such shares. Certain countries may restrict investment opportunities in","page_number":68,"box":{"x":69,"y":309,"width":788,"height":11}},{"id":"684693c7-a351-406c-9dd4-dd7e442ce7cb","block_type":"box","text":"issuers or industries deemed important to national interests.","page_number":68,"box":{"x":70,"y":325,"width":434,"height":10}},{"id":"77004c2f-5696-48d7-acd6-04ff0492b9f9","block_type":"box","text":"The manner in which foreign investors may invest in companies in certain developing Asia-Pacific countries, as","page_number":68,"box":{"x":101,"y":347,"width":787,"height":11}},{"id":"ef63d460-0029-4834-a336-ac6f08cefb3d","block_type":"box","text":"well as limitations on such investments, also may have an adverse impact on the operations of a Fund. For example,","page_number":68,"box":{"x":68,"y":362,"width":833,"height":11}},{"id":"1876874a-8443-4589-8daa-39d2c52eeb30","block_type":"box","text":"a Fund may be required in certain of such countries to invest initially through a local broker or other entity and then","page_number":68,"box":{"x":69,"y":377,"width":820,"height":12}},{"id":"8fb7452e-b4fa-4ac5-ac37-709c0f0c4a30","block_type":"box","text":"have the shares purchased re-registered in the name of the Fund. Re-registration may in some instances not be able","page_number":68,"box":{"x":69,"y":392,"width":831,"height":12}},{"id":"4541531e-8033-4da1-bb7a-ee64ceebe8e7","block_type":"box","text":"to occur on a timely basis, resulting in a delay during which a Fund may be denied certain of its rights as an investor,","page_number":68,"box":{"x":68,"y":407,"width":834,"height":12}},{"id":"91087c90-90d6-40a9-80e3-33cbce41272e","block_type":"box","text":"including rights as to dividends or to be made aware of certain corporate actions. There also may be instances where","page_number":68,"box":{"x":70,"y":423,"width":836,"height":11}},{"id":"3ce23f58-6297-4027-a50e-2892c038a6b5","block_type":"box","text":"a Fund places a purchase order but is subsequently informed, at the time of re-registration, that the permissible","page_number":68,"box":{"x":69,"y":438,"width":800,"height":11}},{"id":"52314b8d-f2ba-4f77-a0bb-f74cab830b3a","block_type":"box","text":"allocation of the investment to foreign investors has been filled, depriving the Fund of the ability to make its desired","page_number":68,"box":{"x":69,"y":453,"width":826,"height":11}},{"id":"d33cd7f1-4894-4446-af66-27f26cf5363b","block_type":"box","text":"investment at that time.","page_number":68,"box":{"x":70,"y":468,"width":168,"height":9}},{"id":"5f2e0375-c6b5-4a14-be40-042e3727f81f","block_type":"box","text":"Substantial limitations may exist in certain countries with respect to a Fund’s ability to repatriate investment","page_number":68,"box":{"x":102,"y":491,"width":774,"height":11}},{"id":"8fa3a285-ed80-40fd-b23b-f7184c07a261","block_type":"box","text":"income, capital or the proceeds of sales of securities by foreign investors. A Fund could be adversely affected by","page_number":68,"box":{"x":70,"y":506,"width":803,"height":11}},{"id":"7ae98d59-decf-400f-97eb-f0e0697413c8","block_type":"box","text":"delays in, or a refusal to grant, any required governmental approval for repatriation of capital, as well as by the","page_number":68,"box":{"x":69,"y":521,"width":789,"height":11}},{"id":"9616cd91-18fc-41fc-a9c2-cc8fc7abacb6","block_type":"box","text":"application to the Fund of any restrictions on investments. It is possible that certain countries may impose currency","page_number":68,"box":{"x":69,"y":536,"width":826,"height":11}},{"id":"6466c2b4-69ee-480d-aab1-d71dd28af03d","block_type":"box","text":"controls or other restrictions relating to their currencies or to securities of issuers in those countries. To the extent","page_number":68,"box":{"x":69,"y":551,"width":818,"height":11}},{"id":"298144ef-735d-442f-9d44-4a43cbb9802e","block_type":"box","text":"that such restrictions have the effect of making certain investments illiquid, securities may not be available for sale","page_number":68,"box":{"x":68,"y":566,"width":826,"height":11}},{"id":"a0abf767-6322-4a5b-9c64-1f98a300cff3","block_type":"box","text":"to meet redemptions. Depending on a variety of financial factors, the percentage of a Fund’s portfolio subject to","page_number":68,"box":{"x":68,"y":581,"width":800,"height":12}},{"id":"25e0a999-8805-4c78-9a86-a6e69f4fe114","block_type":"box","text":"currency controls may increase. In the event other countries impose similar controls, the portion of the Fund’s assets","page_number":68,"box":{"x":69,"y":596,"width":839,"height":12}},{"id":"a969a0e7-70ff-4f2f-8f9d-e82ec6b57687","block_type":"box","text":"that may be used to meet redemptions may be further decreased. Even where there is no outright restriction on","page_number":68,"box":{"x":68,"y":612,"width":798,"height":11}},{"id":"05012c36-ccc6-4721-b0d0-bddddf186878","block_type":"box","text":"repatriation of capital, the mechanics of repatriation may affect certain aspects of the operations of a Fund (for","page_number":68,"box":{"x":69,"y":627,"width":795,"height":11}},{"id":"e884d563-0076-4a7d-a322-7cbeef0b0653","block_type":"box","text":"example, if funds may be withdrawn only in certain currencies and/or only at an exchange rate established by the","page_number":68,"box":{"x":69,"y":642,"width":808,"height":11}},{"id":"d5439f97-45b7-4e12-aa76-63a80b6d9585","block_type":"box","text":"government).","page_number":68,"box":{"x":68,"y":657,"width":92,"height":11}},{"id":"789bf06b-cb41-4349-b590-76827a86069e","block_type":"box","text":"In certain countries, banks or other financial institutions may be among the leading companies or have actively","page_number":68,"box":{"x":102,"y":680,"width":790,"height":11}},{"id":"73da4ad9-e0a2-42a4-8dc5-2a1a2c2a9ccc","block_type":"box","text":"traded securities available for investment. The Investment Company Act restricts a Fund’s investments in any equity","page_number":68,"box":{"x":68,"y":695,"width":828,"height":11}},{"id":"dce6ecd6-4f81-4683-b319-9b6b4f43dac9","block_type":"box","text":"securities of an issuer that, in its most recent fiscal year, derived more than 15% of its revenues from “securities","page_number":68,"box":{"x":69,"y":710,"width":808,"height":11}},{"id":"c974475f-3adc-415a-8caf-8f3036689a6f","block_type":"box","text":"related activities,” as defined by the rules thereunder. These provisions may restrict a Fund’s investments in certain","page_number":68,"box":{"x":69,"y":725,"width":829,"height":11}},{"id":"73bdb53a-accf-482e-b2e7-5f02d0674e4e","block_type":"box","text":"foreign banks and other financial institutions.","page_number":68,"box":{"x":68,"y":740,"width":322,"height":11}},{"id":"6053ba06-881d-462a-aa09-50b74540f6fa","block_type":"box","text":"Political and economic structures in emerging market countries may be undergoing significant evolution and","page_number":68,"box":{"x":102,"y":763,"width":767,"height":11}},{"id":"443ae65c-c883-411f-8f92-85a7f03c8e5e","block_type":"box","text":"rapid development, and these countries may lack the social, political and economic stability characteristic of more","page_number":68,"box":{"x":69,"y":778,"width":814,"height":11}},{"id":"f2d9ccd6-4866-4594-89e6-c7266bb6c3a1","block_type":"box","text":"developed countries. Some of these countries may have in the past failed to recognize private property rights and","page_number":68,"box":{"x":69,"y":793,"width":809,"height":11}},{"id":"c21d6626-6543-4a9e-9373-337aa1cec44d","block_type":"box","text":"have at times nationalized or expropriated the assets of private companies. As a result the risks described above,","page_number":68,"box":{"x":69,"y":808,"width":812,"height":11}},{"id":"e0b6b980-80bd-4001-8a56-9336710769a6","block_type":"box","text":"including the risks of nationalization or expropriation of assets, may be heightened. In addition, unanticipated political","page_number":68,"box":{"x":70,"y":823,"width":838,"height":12}},{"id":"caac674c-69ee-446b-a8c7-b4014980b031","block_type":"box","text":"or social developments may affect the value of investments in these countries and the availability to a Fund of","page_number":68,"box":{"x":69,"y":838,"width":788,"height":11}},{"id":"7b1c4f56-00c2-4667-9b8a-df216238ef8a","block_type":"box","text":"additional investments in emerging market countries. The small size and inexperience of the securities markets in","page_number":68,"box":{"x":69,"y":853,"width":812,"height":12}},{"id":"5b5b1ebb-ed5d-4b92-a082-a2b9f2a2b240","block_type":"box","text":"certain of these countries and the limited volume of trading in securities in these countries may make investments in","page_number":68,"box":{"x":69,"y":869,"width":835,"height":11}},{"id":"f08a8eea-b66f-4f2b-959e-a6b9de7bd5df","block_type":"box","text":"the countries illiquid and more volatile than investments in Japan or most Western European countries. There may be","page_number":68,"box":{"x":68,"y":884,"width":837,"height":11}},{"id":"e1c09c26-18e0-45eb-a55f-e9939c5576da","block_type":"box","text":"II-37","page_number":68,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"5b78c16f-736b-450c-9d2d-552a27885960","block_type":"box","text":"NM0926U-5977317-68/232","page_number":68,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"7bb5e080-bac1-43e3-9f2a-6145fa79f268","block_type":"box","text":"little financial or accounting information available with respect to issuers located in certain emerging market","page_number":69,"box":{"x":70,"y":45,"width":771,"height":11}},{"id":"53887921-d1e3-4445-b317-fab9e5d3dec2","block_type":"box","text":"countries, and it may be difficult to assess the value or prospects of an investment in such issuers.","page_number":69,"box":{"x":69,"y":60,"width":711,"height":11}},{"id":"49676f03-c9de-4d53-ae7d-aed67bd0534c","block_type":"box","text":"The expense ratios of the Funds investing significantly in foreign securities can be expected to be higher than","page_number":69,"box":{"x":101,"y":82,"width":779,"height":12}},{"id":"125cacfc-6d17-4f25-b436-f4f59b8e9e16","block_type":"box","text":"those of Funds investing primarily in domestic securities. The costs attributable to investing abroad are usually higher","page_number":69,"box":{"x":68,"y":98,"width":840,"height":11}},{"id":"d7142135-64a4-45ae-a6de-ddd312b3d82d","block_type":"box","text":"for several reasons, such as the higher cost of custody of foreign securities, higher commissions paid on comparable","page_number":69,"box":{"x":68,"y":113,"width":838,"height":11}},{"id":"1bc0472a-e90e-40ca-a791-faede4172b2a","block_type":"box","text":"transactions on foreign markets and additional costs arising from delays in settlements of transactions involving","page_number":69,"box":{"x":68,"y":128,"width":802,"height":11}},{"id":"1d164801-262e-4738-9e34-7723285154a4","block_type":"box","text":"foreign securities.","page_number":69,"box":{"x":68,"y":143,"width":127,"height":11}},{"id":"24f0d391-4d92-4deb-8a43-592ab4ed4fb7","block_type":"box","text":"Risks of Investments in Russia.","page_number":69,"box":{"x":102,"y":166,"width":224,"height":9}},{"id":"891865c8-07d7-4f41-9922-c5bfbb8748e6","block_type":"box","text":"A Fund may invest a portion of its assets in securities issued by companies","page_number":69,"box":{"x":332,"y":166,"width":539,"height":11}},{"id":"19709f32-285e-4f52-9ddd-2085727339ee","block_type":"box","text":"located in Russia. The Russian securities market suffers from a variety of problems described above in “Investment","page_number":69,"box":{"x":70,"y":181,"width":826,"height":11}},{"id":"b237e578-2e5f-452a-8692-6f5bbdd94dcb","block_type":"box","text":"in Emerging Markets” not encountered in more developed markets. The Russian securities market is relatively new,","page_number":69,"box":{"x":70,"y":196,"width":821,"height":11}},{"id":"50b478ab-03eb-45f5-8348-52be1e8d510e","block_type":"box","text":"and a substantial portion of securities transactions in Russia are privately negotiated outside of stock exchanges.","page_number":69,"box":{"x":69,"y":211,"width":812,"height":11}},{"id":"14bf6845-397d-455c-9a10-4618f4a9b28c","block_type":"box","text":"The inexperience of the Russian securities market and the limited volume of trading in securities in the market may","page_number":69,"box":{"x":68,"y":226,"width":824,"height":11}},{"id":"b45adf1b-1a9c-4074-ba15-911e08c28fb3","block_type":"box","text":"make obtaining accurate prices on portfolio securities from independent sources more difficult than in more","page_number":69,"box":{"x":69,"y":241,"width":771,"height":11}},{"id":"b386d962-b6d0-4ce7-89c4-1826bea301d1","block_type":"box","text":"developed markets.","page_number":69,"box":{"x":69,"y":257,"width":138,"height":10}},{"id":"2b93a098-6fd4-4ccc-a5c2-af382c71e0bf","block_type":"box","text":"Because of the underdeveloped state of Russia’s securities markets and banking and telecommunication","page_number":69,"box":{"x":102,"y":279,"width":751,"height":11}},{"id":"cf792730-2468-4eb1-9065-aaf03a350851","block_type":"box","text":"systems, settlement, clearing and registration of securities transactions are subject to additional risks. Prior to 2013,","page_number":69,"box":{"x":69,"y":294,"width":839,"height":11}},{"id":"28bd647a-8987-4193-9836-08c264c784cc","block_type":"box","text":"there was no central registration system for equity share registration in Russia and registration was carried out either","page_number":69,"box":{"x":68,"y":309,"width":838,"height":11}},{"id":"6231debd-cd96-4370-aaaa-bbe30185a5c2","block_type":"box","text":"by the issuers themselves or by registrars located throughout Russia. These registrars may not have been subject to","page_number":69,"box":{"x":69,"y":325,"width":831,"height":11}},{"id":"d3b0903e-1b59-4719-9687-5ebcded6a746","block_type":"box","text":"effective state supervision or licensed with any governmental entity. In 2013, Russia established the National","page_number":69,"box":{"x":69,"y":339,"width":783,"height":12}},{"id":"1a6ee1bf-c965-4b7e-9b92-772f521b6c37","block_type":"box","text":"Settlement Depository (“NSD”) as a recognized central securities depository, and title to Russian equities held","page_number":69,"box":{"x":69,"y":355,"width":790,"height":11}},{"id":"2e087e61-5e98-4e3e-a59b-d5178a254b38","block_type":"box","text":"through the NSD is now based on the records of the NSD and not on the records of the local registrars. Although the","page_number":69,"box":{"x":68,"y":370,"width":833,"height":11}},{"id":"8d7108dd-a7df-4939-bd55-5d851014009b","block_type":"box","text":"implementation of the NSD has enhanced the efficiency and transparency of the Russian securities market, loss still","page_number":69,"box":{"x":70,"y":385,"width":831,"height":11}},{"id":"13ac1120-b1ae-4b54-abad-5d60a399c1c7","block_type":"box","text":"can occur. Additionally, issuers and registrars remain prominent in the validation and approval of documentation","page_number":69,"box":{"x":69,"y":400,"width":797,"height":11}},{"id":"d13ba2f7-ef22-427f-a048-cb00cadc7339","block_type":"box","text":"requirements for corporate action processing in Russia, and, because the documentation requirements and approval","page_number":69,"box":{"x":69,"y":415,"width":832,"height":11}},{"id":"080c9e8f-698c-4459-9997-12ad631ecb9e","block_type":"box","text":"criteria vary between registrars and issuers, there remain inconsistent market standards in the Russian market with","page_number":69,"box":{"x":69,"y":430,"width":827,"height":11}},{"id":"8d92b444-fa59-4e54-bf7a-73097ca9d900","block_type":"box","text":"respect to the completion and submission of corporate action elections. To the extent that a Fund suffers a loss","page_number":69,"box":{"x":69,"y":445,"width":800,"height":11}},{"id":"89cd32a3-420c-47e7-a34a-451bdd894e1d","block_type":"box","text":"relating to title or corporate actions relating to its portfolio securities, it may be difficult for the Fund to enforce its","page_number":69,"box":{"x":69,"y":460,"width":813,"height":12}},{"id":"e3e98d1c-63ad-4e69-99a9-eb8b87534dde","block_type":"box","text":"rights or otherwise remedy the loss. Russian securities laws may not recognize foreign nominee accounts held with a","page_number":69,"box":{"x":69,"y":475,"width":836,"height":12}},{"id":"44b1a46b-4a20-447c-9a89-446c15ae91be","block_type":"box","text":"custodian bank, and as a result the custodian may be considered the ultimate owner of securities held on behalf of","page_number":69,"box":{"x":69,"y":491,"width":824,"height":11}},{"id":"4e02e2b7-f4b7-426b-9a67-a65daf5d30e4","block_type":"box","text":"their clients. A Fund also may experience difficulty in obtaining and/or enforcing judgments in Russia.","page_number":69,"box":{"x":68,"y":506,"width":723,"height":11}},{"id":"6c02e635-e4f5-4019-b8e3-90de1ec187b7","block_type":"box","text":"In addition, Russia continues to assert its influence in the region through economic and military measures, as it","page_number":69,"box":{"x":102,"y":528,"width":801,"height":12}},{"id":"7f90de01-c95b-4af2-9107-daea9401ac8d","block_type":"box","text":"did with Georgia in the summer of 2008 and the Ukraine in 2014 and 2022. Russia launched a large-scale invasion","page_number":69,"box":{"x":69,"y":543,"width":826,"height":12}},{"id":"bbf66e84-cd3f-49c8-9492-e6f4fd03feb8","block_type":"box","text":"of Ukraine on February 24, 2022. The extent and duration of the military action, resulting sanctions and resulting","page_number":69,"box":{"x":69,"y":559,"width":809,"height":11}},{"id":"3e2e129a-c8de-423c-9d45-27b04e30a1f0","block_type":"box","text":"future market disruptions, including declines in its stock markets and the value of the ruble against the U.S. dollar,","page_number":69,"box":{"x":68,"y":574,"width":821,"height":11}},{"id":"55808fa2-b03d-48f1-aae1-e39b5bd93b66","block_type":"box","text":"are impossible to predict. Any such disruptions caused by Russian military action or other actions (including","page_number":69,"box":{"x":69,"y":589,"width":770,"height":11}},{"id":"0735b421-2850-4db9-8195-ea143c158b2c","block_type":"box","text":"cyberattacks and espionage) or resulting actual and threatened responses to such activity, including purchasing and","page_number":69,"box":{"x":69,"y":604,"width":827,"height":11}},{"id":"f1a28cc6-7ac3-478d-88b3-8bb9c7bda5a1","block_type":"box","text":"financing restrictions, boycotts or changes in consumer or purchaser preferences, sanctions, tariffs or cyberattacks","page_number":69,"box":{"x":68,"y":619,"width":824,"height":11}},{"id":"b76d583d-2b86-479e-84da-48d1bd3bf586","block_type":"box","text":"on the Russian government, Russian companies or Russian individuals, including politicians, may impact Russia’s","page_number":69,"box":{"x":69,"y":634,"width":814,"height":12}},{"id":"5203a06c-4953-4afa-a148-5d453d6c7aa9","block_type":"box","text":"economy and Russian issuers of securities in which the Fund invests. Actual and threatened responses to such","page_number":69,"box":{"x":69,"y":649,"width":795,"height":12}},{"id":"b7b9f910-f075-4ea6-948a-2fc463153b09","block_type":"box","text":"activity, including purchasing restrictions, sanctions, tariffs or cyberattacks on the Russian government or Russian","page_number":69,"box":{"x":69,"y":664,"width":814,"height":12}},{"id":"9f66421f-4938-4561-9c86-96b394661064","block_type":"box","text":"companies, may impact Russia’s economy and Russian issuers of securities in which the Fund invests. Actual and","page_number":69,"box":{"x":69,"y":680,"width":816,"height":11}},{"id":"15b42e7e-f29f-4465-8e91-2a4ec3dc981d","block_type":"box","text":"threatened responses to such military action may also impact the markets for certain Russian commodities, such as","page_number":69,"box":{"x":68,"y":695,"width":836,"height":11}},{"id":"550457a1-8a7d-46ae-be25-bc348e61a8c0","block_type":"box","text":"oil and natural gas, as well as other sectors of the Russian economy, and may likely have collateral impacts on such","page_number":69,"box":{"x":69,"y":710,"width":829,"height":11}},{"id":"ffa79878-9064-4a11-bc62-7972063033e1","block_type":"box","text":"sectors globally.","page_number":69,"box":{"x":69,"y":725,"width":112,"height":11}},{"id":"67666290-b12a-4a63-9aed-19ece3654514","block_type":"box","text":"Governments in the United States and many other countries (collectively, the “Sanctioning Bodies”) have","page_number":69,"box":{"x":102,"y":748,"width":745,"height":11}},{"id":"e3bbf761-5a8a-4eda-98ad-d2f4c71d47ed","block_type":"box","text":"imposed economic sanctions, which can consist of prohibiting certain securities trades, certain private transactions","page_number":69,"box":{"x":70,"y":763,"width":826,"height":11}},{"id":"6d9f24a2-b1c6-4491-9e94-fd4ab3021139","block_type":"box","text":"in the energy sector, asset freezes and prohibition of all business, against certain Russian individuals, including","page_number":69,"box":{"x":70,"y":778,"width":799,"height":11}},{"id":"a02c870d-3c94-48bb-98d1-113e17d0519b","block_type":"box","text":"politicians, and Russian corporate and banking entities. The Sanctioning Bodies, or others, could also institute","page_number":69,"box":{"x":70,"y":793,"width":788,"height":11}},{"id":"c4504f85-0c3c-40d0-86b7-e1f0ae6060db","block_type":"box","text":"broader sanctions on Russia, including banning Russia from global payments systems that facilitate cross-border","page_number":69,"box":{"x":69,"y":808,"width":807,"height":11}},{"id":"d9c55383-a4d9-47d6-96cc-6faff3ed7bc1","block_type":"box","text":"payments. These sanctions, or even the threat of further sanctions, may result in the decline of the value and","page_number":69,"box":{"x":70,"y":823,"width":782,"height":11}},{"id":"b585cbc0-4196-4de5-a8a2-8ff78d43f843","block_type":"box","text":"liquidity of Russian securities, a weakening of the ruble or other adverse consequences to the Russian economy.","page_number":69,"box":{"x":70,"y":838,"width":802,"height":12}},{"id":"7dfb32b1-c786-4961-bc0a-0f25ba527938","block_type":"box","text":"These sanctions have resulted and may continue to result in the immediate freeze of Russian securities and/or","page_number":69,"box":{"x":68,"y":853,"width":797,"height":12}},{"id":"2c65c0de-90a7-4cbd-921a-1a43ab8d648a","block_type":"box","text":"funds invested in prohibited assets, impairing the ability of a Fund to buy, sell, receive or deliver those securities","page_number":69,"box":{"x":68,"y":869,"width":804,"height":11}},{"id":"bcab509f-3623-4634-b54d-d9158b986341","block_type":"box","text":"and/or assets. Sanctions could also result in Russia taking counter measures or retaliatory actions which may","page_number":69,"box":{"x":69,"y":884,"width":791,"height":11}},{"id":"648f1890-9572-4677-8afc-e4e9aca2dd7b","block_type":"box","text":"further impair the value and liquidity of Russian securities.","page_number":69,"box":{"x":68,"y":899,"width":417,"height":11}},{"id":"2fbd105a-bf4f-4bc5-bc48-47389000bfbe","block_type":"box","text":"II-38","page_number":69,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"711ca649-e940-4f7d-baf2-4d90c03bd0d5","block_type":"box","text":"NM0926U-5977317-69/232","page_number":69,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"eeafee70-900e-42e8-b396-8f63b0dd3d9f","block_type":"box","text":"Risks of Investing in Saudi Arabia.","page_number":70,"box":{"x":102,"y":45,"width":241,"height":11}},{"id":"09920b7b-9aad-49cd-bfdf-82297dbcc864","block_type":"box","text":"The ability of foreign investors (such as a Fund) to invest in Saudi Arabian","page_number":70,"box":{"x":350,"y":45,"width":523,"height":11}},{"id":"8c0cac5b-d7e2-4bcc-9da1-509ee0005973","block_type":"box","text":"issuers is new and untested. Such ability could be restricted or revoked by the Saudi Arabian government at any time,","page_number":70,"box":{"x":70,"y":60,"width":838,"height":11}},{"id":"726a4993-caf1-459a-9401-c6f07146a3d8","block_type":"box","text":"and unforeseen risks could materialize due to foreign ownership in such securities. In addition, the Capital Market","page_number":70,"box":{"x":69,"y":75,"width":814,"height":11}},{"id":"f6cb2698-3ac4-4d76-be33-f722a9e52e46","block_type":"box","text":"Authority (“CMA”) places investment limitations on the ownership of Saudi Arabian issuers by foreign investors,","page_number":70,"box":{"x":68,"y":90,"width":793,"height":11}},{"id":"69f251f4-3f8c-4274-8313-657f7fd4f1b6","block_type":"box","text":"including a limitation on a Fund’s ownership of any single issuer listed on the Saudi Arabian Stock Exchange, which","page_number":70,"box":{"x":70,"y":105,"width":819,"height":11}},{"id":"6025002c-112f-4149-af00-02296256d040","block_type":"box","text":"may prevent a Fund from investing in accordance with its strategy and contribute to tracking error against the","page_number":70,"box":{"x":69,"y":120,"width":777,"height":12}},{"id":"6e49db25-5746-4b04-ba5e-d41d7b66bb4a","block_type":"box","text":"Underlying Index. These restrictions may be changed or new restrictions, such as licensing requirements, special","page_number":70,"box":{"x":70,"y":136,"width":803,"height":11}},{"id":"7afeba3a-5979-457b-a57f-7b6e60091d7d","block_type":"box","text":"approvals or additional foreign taxes, may be instituted at any time. A Fund may not be able to obtain or maintain any","page_number":70,"box":{"x":69,"y":150,"width":837,"height":12}},{"id":"65572c85-a3c2-4bd6-9667-35b4d1038590","block_type":"box","text":"such licenses or approvals and may not be able to buy and sell securities at full value. Major disruptions or","page_number":70,"box":{"x":69,"y":166,"width":765,"height":11}},{"id":"3b9a315a-3585-4bf4-ac9a-d77797fce750","block_type":"box","text":"regulatory changes could occur in the Saudi Arabian market, any of which could negatively impact a Fund. These risks","page_number":70,"box":{"x":69,"y":181,"width":838,"height":11}},{"id":"7dc6066d-e529-45cd-928b-4052ab8868b6","block_type":"box","text":"may be exacerbated, compared to more developed markets, given the limited history of foreign investment in the","page_number":70,"box":{"x":69,"y":196,"width":805,"height":11}},{"id":"18a0afad-b0d6-4af7-aaf2-2b76ad688a11","block_type":"box","text":"Saudi Arabian market. Investments in Saudi Arabia may also be subject to loss due to expropriation or nationalization","page_number":70,"box":{"x":69,"y":211,"width":837,"height":11}},{"id":"1b8c3938-0054-4779-ac6c-9d40981de982","block_type":"box","text":"of assets and property or the imposition of restrictions on additional foreign investments and repatriation of capital.","page_number":70,"box":{"x":69,"y":226,"width":826,"height":11}},{"id":"1f122c04-4efc-4d15-a643-5ed4db18f7df","block_type":"box","text":"Such heightened risks may include, among others, restrictions on and government intervention in international trade,","page_number":70,"box":{"x":69,"y":241,"width":834,"height":11}},{"id":"1eb61bfc-8c2d-4464-b766-f18694299796","block_type":"box","text":"confiscatory taxation, political instability, including authoritarian and/or military involvement in governmental decision","page_number":70,"box":{"x":69,"y":256,"width":835,"height":12}},{"id":"7b3725b2-f57e-432f-a79b-611aad76f3c6","block_type":"box","text":"making, armed conflict, crime and instability as a result of religious, ethnic and/or socioeconomic unrest. Saudi","page_number":70,"box":{"x":69,"y":271,"width":797,"height":12}},{"id":"05365bb0-cb3b-4900-89ad-0bc6ae909964","block_type":"box","text":"Arabia has privatized, or has begun the process of privatizing, certain entities and industries. Newly privatized","page_number":70,"box":{"x":68,"y":286,"width":781,"height":12}},{"id":"ab9e590a-d77a-4776-9a0a-f3693b3aec69","block_type":"box","text":"companies may face strong competition from government-sponsored competitors that have not been privatized. In","page_number":70,"box":{"x":69,"y":302,"width":811,"height":11}},{"id":"701b625b-7f70-4d5d-8edb-ea73ca692dcb","block_type":"box","text":"some instances, investors in newly privatized entities have suffered losses due to the inability of the newly privatized","page_number":70,"box":{"x":69,"y":317,"width":833,"height":11}},{"id":"6bf2ef15-1061-4dc3-81db-85eb6ff9d060","block_type":"box","text":"entities to adjust quickly to a competitive environment or changing regulatory and legal standards or, in some cases,","page_number":70,"box":{"x":69,"y":332,"width":831,"height":11}},{"id":"91b09f29-e3d6-44f3-b01e-6487190fb058","block_type":"box","text":"due to re-nationalization of such privatized entities. There is no assurance that similar losses will not recur. Further,","page_number":70,"box":{"x":69,"y":347,"width":823,"height":11}},{"id":"a23891e6-9fed-4a28-a742-c1240f9621b7","block_type":"box","text":"under income tax laws imposed by the Department of Zakat and Income Tax, dividends paid by a Saudi Arabian","page_number":70,"box":{"x":69,"y":362,"width":791,"height":11}},{"id":"9adde06a-039b-4fd8-bf77-f8524bf0e3dc","block_type":"box","text":"company to foreign stockholders are generally subject to a 5% withholding tax (different tax rates may apply pursuant","page_number":70,"box":{"x":69,"y":377,"width":835,"height":12}},{"id":"b3f27cab-fb5b-4ec5-9c4e-3d3d6927f28d","block_type":"box","text":"to an applicable treaty). Saudi Arabia is highly reliant on income from the sale of petroleum and trade with other","page_number":70,"box":{"x":68,"y":392,"width":799,"height":12}},{"id":"a4091d16-f9fc-4ec9-93a1-dba7ea7dee00","block_type":"box","text":"countries involved in the sale of petroleum, and its economy is therefore vulnerable to changes in foreign currency","page_number":70,"box":{"x":69,"y":407,"width":815,"height":12}},{"id":"6338ac95-3a3e-4c35-ae29-291ee9cf64e1","block_type":"box","text":"values and the market for petroleum. As global demand for petroleum fluctuates, Saudi Arabia may be significantly","page_number":70,"box":{"x":68,"y":423,"width":818,"height":11}},{"id":"1d88de2c-8410-4bbb-bce5-5417f4e7eea0","block_type":"box","text":"impacted.","page_number":70,"box":{"x":70,"y":438,"width":67,"height":11}},{"id":"e3ff19ec-ec3e-4606-964b-76dd9c5f08de","block_type":"box","text":"Like most Middle Eastern governments, the government of Saudi Arabia exercises substantial influence over","page_number":70,"box":{"x":102,"y":460,"width":773,"height":12}},{"id":"11be9132-5e97-4be7-8db1-de38b25f3382","block_type":"box","text":"many aspects of the private sector. Although liberalization in the wider economy is underway, in many areas it has","page_number":70,"box":{"x":69,"y":475,"width":812,"height":12}},{"id":"76619269-4558-4b96-b5f4-75eaa78e9447","block_type":"box","text":"lagged significantly: restrictions on foreign ownership persist, and the government has an ownership stake in many","page_number":70,"box":{"x":70,"y":491,"width":818,"height":11}},{"id":"d0c28e01-c409-4e9f-a09c-3cf97b7df2bd","block_type":"box","text":"key industries. The situation is exacerbated by the fact that Saudi Arabia is governed by an absolute monarchy. Saudi","page_number":70,"box":{"x":69,"y":506,"width":836,"height":11}},{"id":"785e3549-821e-43bb-91b7-037f902fbb57","block_type":"box","text":"Arabia has historically experienced strained relations with economic partners worldwide, including other countries in","page_number":70,"box":{"x":68,"y":521,"width":826,"height":11}},{"id":"3d41ce23-ca7f-4c18-9a6c-7bae62cf5f51","block_type":"box","text":"the Middle East due to geopolitical events. Incidents involving a Middle Eastern country’s or the region’s security,","page_number":70,"box":{"x":68,"y":536,"width":809,"height":11}},{"id":"c5eea6d1-c8a5-4a0e-8149-7f898417d8eb","block_type":"box","text":"including terrorism, may cause uncertainty in their markets and may adversely affect its economy and a Fund’s","page_number":70,"box":{"x":70,"y":551,"width":790,"height":11}},{"id":"b3b8e9f7-76fe-4ad6-a2eb-d869e395baa3","block_type":"box","text":"investments. Governmental actions in the future could have a significant effect on economic conditions in Saudi","page_number":70,"box":{"x":70,"y":566,"width":798,"height":11}},{"id":"7c9936a1-66c2-467f-afce-4daf5951434c","block_type":"box","text":"Arabia, which could affect private sector companies and a Fund, as well as the value of securities in a Fund’s","page_number":70,"box":{"x":68,"y":581,"width":781,"height":11}},{"id":"964a5525-a69d-4bfc-88a9-fb6a8d54474c","block_type":"box","text":"portfolio. Any economic sanctions on Saudi Arabian individuals or Saudi Arabian corporate entities, or even the threat","page_number":70,"box":{"x":70,"y":596,"width":836,"height":12}},{"id":"93758892-fdeb-41af-a3e2-cdf968b831dc","block_type":"box","text":"of sanctions, may result in the decline of the value and liquidity of Saudi Arabian securities, a weakening of the Saudi","page_number":70,"box":{"x":69,"y":612,"width":837,"height":11}},{"id":"fb0b0b8d-0647-4405-ba3e-7ab0e634e0bc","block_type":"box","text":"riyal or other adverse consequences to the Saudi Arabian economy. In addition, Saudi Arabia’s economy relies heavily","page_number":70,"box":{"x":69,"y":627,"width":838,"height":11}},{"id":"87c547b9-c5f5-4f1e-9801-0ed32028bc9c","block_type":"box","text":"on cheap, foreign labor, and changes in the availability of this labor supply could have an adverse effect on the","page_number":70,"box":{"x":69,"y":642,"width":790,"height":11}},{"id":"fd3c3103-35b6-497d-8dbc-71a987f1158e","block_type":"box","text":"economy.","page_number":70,"box":{"x":69,"y":659,"width":65,"height":9}},{"id":"0d499d69-035d-4edb-933a-6db0c301fc47","block_type":"box","text":"The securities markets in Saudi Arabia may not be as developed as those in other countries. As a result,","page_number":70,"box":{"x":101,"y":680,"width":747,"height":11}},{"id":"8d33d7e2-8867-445e-8173-144ed46a08ce","block_type":"box","text":"securities markets in Saudi Arabia are subject to greater risks associated with market volatility, lower market","page_number":70,"box":{"x":69,"y":695,"width":776,"height":11}},{"id":"dc0c888c-660d-48d0-a79d-0f9fa55480c6","block_type":"box","text":"capitalization, lower trading volume, illiquidity, inflation, greater price fluctuations, uncertainty regarding the existence","page_number":70,"box":{"x":69,"y":710,"width":836,"height":11}},{"id":"a62f3e54-54db-448f-8c52-d8ef5385251e","block_type":"box","text":"of trading markets, governmental control and heavy regulation of labor and industry. Shares of certain Saudi Arabian","page_number":70,"box":{"x":69,"y":725,"width":830,"height":11}},{"id":"bc2897ab-1747-4227-ac06-90f1eb0faed1","block_type":"box","text":"companies tend to trade less frequently than those of companies on exchanges in more developed markets. Such","page_number":70,"box":{"x":69,"y":740,"width":813,"height":11}},{"id":"45ef23e1-b5f9-426f-bb78-38511f1b9ffb","block_type":"box","text":"infrequent trading may adversely affect the pricing of these securities and a Fund’s ability to sell these securities in","page_number":70,"box":{"x":70,"y":755,"width":822,"height":11}},{"id":"aaf1e85e-bb8d-48ca-b295-d56795cf0203","block_type":"box","text":"the future. Current regulations in Saudi Arabian markets may require a Fund to execute trades of securities through a","page_number":70,"box":{"x":68,"y":770,"width":837,"height":12}},{"id":"7cfe0143-41a0-4e5c-b930-664c63e809ca","block_type":"box","text":"single broker. As a result, the Manager will have less flexibility to choose among brokers on behalf of a Fund than is","page_number":70,"box":{"x":69,"y":785,"width":826,"height":12}},{"id":"b7fd2ceb-8c77-4658-9f26-76111713e707","block_type":"box","text":"typically the case for investment managers.","page_number":70,"box":{"x":68,"y":801,"width":309,"height":11}},{"id":"3d65f7db-16bc-4f63-8423-fdb087a85721","block_type":"box","text":"Although the political situation in Saudi Arabia is largely stable, Saudi Arabia has historically experienced political","page_number":70,"box":{"x":101,"y":823,"width":806,"height":12}},{"id":"31eda00b-83d2-4e35-ab18-58182fdc9588","block_type":"box","text":"instability, and there remains the possibility that the stability will not hold in the future or that instability in the larger","page_number":70,"box":{"x":70,"y":838,"width":828,"height":12}},{"id":"f7d23280-c03a-44f7-a5db-6b5e06b813b2","block_type":"box","text":"Middle East region could adversely impact the economy of Saudi Arabia. Instability may be caused by military","page_number":70,"box":{"x":70,"y":853,"width":777,"height":12}},{"id":"0998da4c-b7ca-4a44-adb0-7285fa5ad6ab","block_type":"box","text":"developments, government interventions in the marketplace, terrorism, extremist attitudes, attempted social or","page_number":70,"box":{"x":69,"y":869,"width":796,"height":11}},{"id":"d02d08e5-b692-4534-b8fb-f1c60e991148","block_type":"box","text":"political reforms, religious differences, or other factors. Additionally, anti-Western views held by certain groups in the","page_number":70,"box":{"x":70,"y":884,"width":830,"height":11}},{"id":"50795e80-4b86-4979-884e-c14e0126b9bc","block_type":"box","text":"Middle East may influence government policies regarding foreign investment. Further developments in U.S. relations","page_number":70,"box":{"x":70,"y":899,"width":827,"height":11}},{"id":"79ffa362-24e6-4a84-80ed-480c7f2c15d2","block_type":"box","text":"II-39","page_number":70,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"99630d19-d6b9-4bdd-8058-6b313fcb2da9","block_type":"box","text":"NM0926U-5977317-70/232","page_number":70,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"668e3638-96b0-4cde-af1c-ef04e1d21681","block_type":"box","text":"with Saudi Arabia and other Middle-Eastern countries may affect these attitudes and policies. The U.S. is a","page_number":71,"box":{"x":68,"y":45,"width":764,"height":11}},{"id":"3ad5658b-bd27-4371-9a97-9c180a177e63","block_type":"box","text":"significant, and in some cases the most significant, trading partner of, or foreign investor in, Saudi Arabia. As a","page_number":71,"box":{"x":69,"y":60,"width":795,"height":11}},{"id":"7d27e3a2-4ca4-468c-9600-201e207c1d5c","block_type":"box","text":"result, economic conditions of Saudi Arabia may be particularly affected by changes in the U.S. economy. A decrease","page_number":71,"box":{"x":69,"y":75,"width":835,"height":11}},{"id":"bc7192a6-a8e6-49ca-abb1-94eeb8ecf7b3","block_type":"box","text":"in U.S. imports or exports, new trade and financial regulations or tariffs, changes in the U.S. dollar exchange rate or","page_number":71,"box":{"x":70,"y":90,"width":829,"height":11}},{"id":"18eb015b-10aa-4317-98c6-860486feb208","block_type":"box","text":"an economic slowdown in the U.S. may have a material adverse effect on the economic conditions of Saudi Arabia","page_number":71,"box":{"x":69,"y":105,"width":815,"height":11}},{"id":"b2125ecd-b475-4e30-9d25-9020946cd0ca","block_type":"box","text":"and, as a result, securities to which the Fund has exposure. Political instability in North Africa and the larger Middle","page_number":71,"box":{"x":69,"y":120,"width":825,"height":12}},{"id":"aa6ddda9-7e10-4c5e-aeca-e7ac1723b682","block_type":"box","text":"East region has caused significant disruptions to many industries. Continued political and social unrest in these","page_number":71,"box":{"x":70,"y":135,"width":797,"height":12}},{"id":"f76c28e5-11f4-4469-ae4e-2fa6c97c7484","block_type":"box","text":"areas may negatively affect the value of securities in a Fund’s portfolio.","page_number":71,"box":{"x":69,"y":150,"width":510,"height":12}},{"id":"c295d41d-d13c-47f4-8b29-6f398a41b16b","block_type":"box","text":"Certain issuers located in Saudi Arabia may operate in, or have dealings with, countries subject to sanctions","page_number":71,"box":{"x":102,"y":173,"width":773,"height":11}},{"id":"58c94d48-24f4-4ba1-8c63-86844b588f38","block_type":"box","text":"and/or embargoes imposed by the U.S. Government and the United Nations and/or countries identified by the U.S.","page_number":71,"box":{"x":69,"y":188,"width":820,"height":12}},{"id":"bb343786-e2e5-460d-8df3-6e3bf0d8f060","block_type":"box","text":"Government as state sponsors of terrorism. As a result, an issuer may sustain damage to its reputation if it is","page_number":71,"box":{"x":69,"y":203,"width":787,"height":12}},{"id":"8596d643-e8df-4cd3-9dea-fdae5731d38a","block_type":"box","text":"identified as an issuer which operates in, or has dealings with, such countries. A Fund, as an investor in such issuers","page_number":71,"box":{"x":70,"y":218,"width":837,"height":12}},{"id":"53210bc4-7fd6-497b-8359-f1c457784f32","block_type":"box","text":"will be indirectly subject to those risks.","page_number":71,"box":{"x":68,"y":234,"width":277,"height":11}},{"id":"3ccc553d-102b-42e6-9da0-c3159a8a22da","block_type":"box","text":"Risks of Investing in Venezuela.","page_number":71,"box":{"x":102,"y":256,"width":223,"height":12}},{"id":"95b9d21c-eee9-4490-a7c9-f50ca245d118","block_type":"box","text":"Investment in Venezuela may subject a Fund to legal, regulatory, political,","page_number":71,"box":{"x":332,"y":257,"width":521,"height":11}},{"id":"aaf761b0-db12-4487-b7f7-d4043ac84e5e","block_type":"box","text":"currency, security, expropriation and/or nationalization of assets and economic risk specific to Venezuela. Venezuela","page_number":71,"box":{"x":69,"y":271,"width":829,"height":12}},{"id":"32aa2dd3-dc8f-4124-b4b9-f555364ce14e","block_type":"box","text":"is extremely well endowed with natural resources, including oil and natural gas, and its economy is heavily dependent","page_number":71,"box":{"x":70,"y":287,"width":837,"height":11}},{"id":"5e761c4b-eb11-4163-b3fd-15f21b46b61e","block_type":"box","text":"on export of natural resources to key trading partners. Any act of terrorism, an armed conflict or a breakdown of a","page_number":71,"box":{"x":69,"y":302,"width":813,"height":11}},{"id":"84ae1c07-7f8b-453c-8b5e-d831f5696ecc","block_type":"box","text":"key trading relationship that disrupts the production or export of natural resources will likely negatively affect the","page_number":71,"box":{"x":69,"y":317,"width":804,"height":11}},{"id":"f9536ff9-2916-4061-9451-6c7824c9c87d","block_type":"box","text":"Venezuelan economy. The government continues to control key sectors of the economy, including upstream oil and","page_number":71,"box":{"x":68,"y":332,"width":816,"height":11}},{"id":"b1ee355f-0e00-49f8-8a38-240eb7e6cf63","block_type":"box","text":"gas production, and has sought to increase its role in key sectors, such as telecommunications and steel.","page_number":71,"box":{"x":68,"y":347,"width":758,"height":11}},{"id":"9f620f5e-22f5-4145-b8de-db7454879226","block_type":"box","text":"Meanwhile, ambiguities in the investment environment remain, such as continued high levels of bureaucracy and","page_number":71,"box":{"x":70,"y":362,"width":803,"height":11}},{"id":"2e3222a9-c4e1-436b-bb40-facf8369efe2","block_type":"box","text":"corruption, large macroeconomic imbalances, and political and policy uncertainty. Friction continues between the","page_number":71,"box":{"x":69,"y":377,"width":804,"height":12}},{"id":"baf969d3-ce35-476c-a1fe-73b124f5c129","block_type":"box","text":"governments of the U.S. and Venezuela. The U.S. has imposed economic sanctions, which consist of asset freezes","page_number":71,"box":{"x":68,"y":392,"width":822,"height":12}},{"id":"e609a92c-7acd-4170-9c67-8ef0cf7766c2","block_type":"box","text":"and sectoral sanctions, on certain Venezuelan individuals and Venezuelan corporate entities, and on the Venezuelan","page_number":71,"box":{"x":69,"y":408,"width":827,"height":10}},{"id":"cac43ad3-9a56-4b93-b32c-bf05470d21ff","block_type":"box","text":"government. The U.S. could also institute broader sanctions on Venezuela. The U.S. has also taken military action","page_number":71,"box":{"x":68,"y":423,"width":814,"height":11}},{"id":"dc87a54d-c2cf-4713-90e0-e32bf5b5477d","block_type":"box","text":"against Venezuela in an effort to effect regime change. Military action, sanctions, or even the threat of further","page_number":71,"box":{"x":69,"y":438,"width":787,"height":11}},{"id":"2ed44e9a-7b84-4841-a17d-2dfbd67ead24","block_type":"box","text":"military action and sanctions, may result in the decline of the value and liquidity of Venezuelan securities, a","page_number":71,"box":{"x":69,"y":453,"width":766,"height":11}},{"id":"f2293721-c927-4655-85f3-7409a3f437cb","block_type":"box","text":"weakening of the bolivar or other adverse consequences to the Venezuelan economy. These sanctions impair the","page_number":71,"box":{"x":68,"y":468,"width":804,"height":11}},{"id":"d5e17cf2-d81c-4a5f-bfa3-554cbe025d06","block_type":"box","text":"ability of a Fund to buy, sell, receive or deliver those securities and/or assets. Additional sanctions against Venezuela","page_number":71,"box":{"x":69,"y":483,"width":838,"height":11}},{"id":"b97649c3-7445-4dec-a5b5-cad2a61500b8","block_type":"box","text":"may in the future be imposed by the U.S. or other countries. These factors, among others, can have a negative","page_number":71,"box":{"x":69,"y":498,"width":790,"height":11}},{"id":"e3409770-070a-4ecc-b22e-531ea2aac331","block_type":"box","text":"impact on a Fund’s investments.","page_number":71,"box":{"x":70,"y":514,"width":230,"height":10}},{"id":"986e8cff-dcaf-4132-b7f3-a3d2a3439bb0","block_type":"box","text":"Brady Bonds.","page_number":71,"box":{"x":102,"y":536,"width":92,"height":11}},{"id":"70b7a8f5-f43b-412e-9437-89bcc63b4fa9","block_type":"box","text":"Certain Funds may invest in Brady Bonds. A Fund’s emerging market debt securities may include","page_number":71,"box":{"x":201,"y":536,"width":689,"height":11}},{"id":"3525420b-89bd-4c68-ad7e-3f49a4e4f0b4","block_type":"box","text":"emerging market governmental debt obligations commonly referred to as Brady Bonds. Brady Bonds are securities","page_number":71,"box":{"x":69,"y":551,"width":815,"height":11}},{"id":"d347f61d-46c9-4ca5-9020-bfd36b4ffcb3","block_type":"box","text":"created through the exchange of existing commercial bank loans to sovereign entities for new obligations in","page_number":71,"box":{"x":69,"y":566,"width":766,"height":11}},{"id":"83c7d4bc-f473-4ba0-8c97-ac78f88ad172","block_type":"box","text":"connection with debt restructurings under a debt restructuring plan introduced by former U.S. Secretary of the","page_number":71,"box":{"x":69,"y":581,"width":784,"height":12}},{"id":"f08d40dc-9f9c-4ca7-bea1-9630511ad105","block_type":"box","text":"Treasury, Nicholas F. Brady (the “Brady Plan”). Brady Plan debt restructurings have been implemented in a number of","page_number":71,"box":{"x":68,"y":596,"width":837,"height":12}},{"id":"f991bb5d-fa03-42bd-9e4f-2a36a0b362dc","block_type":"box","text":"countries, including: Argentina, Bolivia, Brazil, Bulgaria, Costa Rica, the Dominican Republic, Ecuador, Jordan, Mexico,","page_number":71,"box":{"x":69,"y":612,"width":839,"height":11}},{"id":"6ca1a66f-52be-4cbf-b0b1-ea5aae2fb290","block_type":"box","text":"Niger, Nigeria, Panama, Peru, the Philippines, Poland, Uruguay, Venezuela, and Vietnam. Beginning in the early","page_number":71,"box":{"x":70,"y":627,"width":786,"height":11}},{"id":"ded77f68-1356-44a7-b23e-a96cf3f4eb7c","block_type":"box","text":"2000s, certain countries began retiring their Brady Bonds, including Brazil, Colombia, Mexico, the Philippines, and","page_number":71,"box":{"x":69,"y":642,"width":814,"height":11}},{"id":"ca5cb2d1-e92d-4436-a1ab-9cb46183e36b","block_type":"box","text":"Venezuela.","page_number":71,"box":{"x":68,"y":657,"width":75,"height":9}},{"id":"3b1e312b-ba6b-4c4c-8d8b-105d4426d29a","block_type":"box","text":"Brady Bonds may be collateralized or uncollateralized, are issued in various currencies (primarily the U.S. dollar)","page_number":71,"box":{"x":102,"y":680,"width":798,"height":11}},{"id":"7a780a43-6d8b-491d-aba4-71b9f2c5bfa6","block_type":"box","text":"and are actively traded in the OTC secondary market. Brady Bonds are not considered to be U.S. Government","page_number":71,"box":{"x":69,"y":695,"width":780,"height":11}},{"id":"77474b9e-2e45-4567-9b4a-6318b11dc713","block_type":"box","text":"Securities. U.S. dollar-denominated, collateralized Brady Bonds, which may be fixed rate par bonds or floating rate","page_number":71,"box":{"x":69,"y":710,"width":812,"height":11}},{"id":"db00155f-2f85-4269-a01d-e39b276454f5","block_type":"box","text":"discount bonds, are generally collateralized in full as to principal by U.S. Treasury zero-coupon bonds having the","page_number":71,"box":{"x":69,"y":725,"width":796,"height":11}},{"id":"112a8ca2-2cb8-4bc0-8115-45b8ea7ec433","block_type":"box","text":"same maturity as the Brady Bonds. Interest payments on these Brady Bonds generally are collateralized on a one","page_number":71,"box":{"x":69,"y":740,"width":812,"height":11}},{"id":"c842e3ee-e5f8-4930-a42b-569e5492bc3b","block_type":"box","text":"year or longer rolling-forward basis by cash or securities in an amount that, in the case of fixed rate bonds, is equal","page_number":71,"box":{"x":68,"y":755,"width":823,"height":11}},{"id":"c712c62c-6894-414d-b293-f3f52f44f3c4","block_type":"box","text":"to at least one year of interest payments or, in the case of floating rate bonds, initially is equal to at least one year’s","page_number":71,"box":{"x":68,"y":770,"width":833,"height":12}},{"id":"98fda2c5-a4e4-4d63-a5f4-2e61661e1f08","block_type":"box","text":"interest payments based on the applicable interest rate at that time and is adjusted at regular intervals thereafter.","page_number":71,"box":{"x":70,"y":785,"width":816,"height":12}},{"id":"bf5283eb-d130-49d0-9353-25725ec7459a","block_type":"box","text":"Certain Brady Bonds are entitled to “value recovery payments” in certain circumstances, which in effect constitute","page_number":71,"box":{"x":69,"y":801,"width":818,"height":11}},{"id":"9799472d-2a1c-49b7-b025-1dbb544c7dc7","block_type":"box","text":"supplemental interest payments but generally are not collateralized. Brady Bonds are often viewed as having three or","page_number":71,"box":{"x":69,"y":816,"width":835,"height":11}},{"id":"3620f4dd-b7d3-42fc-b1ae-cc23138b2b5e","block_type":"box","text":"four valuation components: (i) the collateralized repayment of principal at final maturity; (ii) the collateralized interest","page_number":71,"box":{"x":68,"y":831,"width":832,"height":11}},{"id":"4e2e41e9-b6f5-4d0b-8b26-c71936e5387c","block_type":"box","text":"payments; (iii) the uncollateralized interest payments; and (iv) any uncollateralized repayment of principal at maturity","page_number":71,"box":{"x":70,"y":846,"width":828,"height":11}},{"id":"193adb1d-ac2b-4b55-b6c3-3bc4290f3771","block_type":"box","text":"(the uncollateralized amounts constitute the “residual risk”).","page_number":71,"box":{"x":69,"y":861,"width":430,"height":11}},{"id":"d3d3c515-4048-43d2-9c15-142d57a439de","block_type":"box","text":"Brady Bonds involve various risk factors described above associated with investing in foreign securities, including","page_number":71,"box":{"x":102,"y":884,"width":807,"height":11}},{"id":"b630332d-7f6a-4b2a-b39e-599df48582f3","block_type":"box","text":"the history of defaults with respect to commercial bank loans by public and private entities of countries issuing Brady","page_number":71,"box":{"x":68,"y":899,"width":838,"height":11}},{"id":"ae68e313-4787-4a68-a4e3-34d3d90df291","block_type":"box","text":"II-40","page_number":71,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"0f5c0c66-ad4f-435a-b036-b8a33867f218","block_type":"box","text":"NM0926U-5977317-71/232","page_number":71,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"eca2bd29-86c2-4f61-a86b-0c7a61429665","block_type":"box","text":"Bonds. In light of the residual risk of Brady Bonds and, among other factors, the history of defaults, investments in","page_number":72,"box":{"x":70,"y":45,"width":819,"height":11}},{"id":"d062789f-37ff-4ee6-b595-96b36f9e0fd0","block_type":"box","text":"Brady Bonds are considered speculative. There can be no assurance that Brady Bonds in which the Funds may invest","page_number":72,"box":{"x":70,"y":60,"width":835,"height":11}},{"id":"e8f58669-dd4f-4e7d-bb74-9bc5d290845e","block_type":"box","text":"will not be subject to restructuring arrangements or to requests for new credit, which may cause the Funds to suffer a","page_number":72,"box":{"x":68,"y":75,"width":841,"height":11}},{"id":"cd20f346-f16b-4614-b63d-c39c7ffd46dd","block_type":"box","text":"loss of interest or principal on any of its holdings.","page_number":72,"box":{"x":70,"y":90,"width":351,"height":11}},{"id":"c536a221-0f61-447d-9508-8f19ce281125","block_type":"box","text":"China Investments Risk.","page_number":72,"box":{"x":102,"y":113,"width":171,"height":9}},{"id":"415313d1-767e-428e-b36b-a9e4807f4685","block_type":"box","text":"Investments in securities of companies domiciled in the People’s Republic of China (“China” or the “PRC”),","page_number":72,"box":{"x":102,"y":135,"width":763,"height":11}},{"id":"7c040d1d-fdd8-4d68-ae36-37c36508997b","block_type":"box","text":"including certain Hong Kong-listed and U.S.-listed securities, involve a high degree of risk and special considerations","page_number":72,"box":{"x":70,"y":150,"width":830,"height":12}},{"id":"de051615-c669-4a32-87bb-e4d0e7bbe592","block_type":"box","text":"not typically associated with investing in the U.S. securities markets. Such heightened risks include, among others,","page_number":72,"box":{"x":69,"y":166,"width":821,"height":11}},{"id":"c5d76172-e1b3-4e77-9511-81f2bcf573e4","block_type":"box","text":"an authoritarian government, popular unrest associated with demands for improved political, economic and social","page_number":72,"box":{"x":69,"y":181,"width":809,"height":11}},{"id":"d988c07e-f3bd-4d89-9d32-3ecc73f3f0ba","block_type":"box","text":"conditions, the impact of regional conflict on the economy and hostile relations with other countries.","page_number":72,"box":{"x":69,"y":196,"width":713,"height":11}},{"id":"4c91edde-53ff-476b-af6c-afce333b5b19","block_type":"box","text":"Military conflicts, either in response to internal social unrest or conflicts with other countries, could disrupt","page_number":72,"box":{"x":102,"y":218,"width":762,"height":12}},{"id":"5f1569e2-7cbd-4f1d-bf14-bdb6cd275a41","block_type":"box","text":"economic development. The Chinese economy is vulnerable to the long-running disagreements and religious and","page_number":72,"box":{"x":69,"y":234,"width":800,"height":11}},{"id":"f665215c-6287-4d4c-bb83-b5cfaa0762f2","block_type":"box","text":"nationalist disputes with Tibet and the Xinjiang region. Since 1997, there have been tensions between the Chinese","page_number":72,"box":{"x":69,"y":249,"width":820,"height":11}},{"id":"563bc388-bafe-4b46-86b0-13ca31647bea","block_type":"box","text":"government and many people in Hong Kong who perceive China as tightening control over Hong Kong’s semi","page_number":72,"box":{"x":68,"y":264,"width":777,"height":11}},{"id":"f613f4a6-6f6d-4af1-beb7-e652ee28ac64","block_type":"box","text":"autonomous liberal political, economic, legal, and social framework. Protests and unrest have increased tensions","page_number":72,"box":{"x":69,"y":279,"width":809,"height":11}},{"id":"ff5b95ba-e3ed-43da-ad98-fd8038c2b075","block_type":"box","text":"even further. Due to the interconnected nature of the Hong Kong and Chinese economies, this instability in Hong","page_number":72,"box":{"x":69,"y":294,"width":805,"height":11}},{"id":"23b21eca-fbc1-4a45-94e1-0c119fe63845","block_type":"box","text":"Kong may cause uncertainty in the Hong Kong and Chinese markets. China has a complex territorial dispute","page_number":72,"box":{"x":70,"y":309,"width":770,"height":11}},{"id":"584bf8a8-00b5-46d5-a36b-5b74883bdfa1","block_type":"box","text":"regarding the sovereignty of Taiwan and has made threats of invasion. Taiwan-based companies and individuals are","page_number":72,"box":{"x":69,"y":324,"width":821,"height":12}},{"id":"a6e6d4da-9c04-4a07-9585-021d57426a2a","block_type":"box","text":"significant investors in China. The continuing hostility between China and Taiwan may have an adverse impact on the","page_number":72,"box":{"x":69,"y":339,"width":831,"height":12}},{"id":"3c25a0e0-d731-490e-81c0-17e6dcb22be0","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 certain","page_number":72,"box":{"x":68,"y":355,"width":812,"height":11}},{"id":"1fb84ff0-57e7-4245-a5a0-3446dbcd0a12","block_type":"box","text":"securities or other assets or may otherwise make such investments impracticable or impossible. Any escalation of","page_number":72,"box":{"x":69,"y":370,"width":818,"height":11}},{"id":"f5388d46-037a-47ed-9740-dafab9e64fe4","block_type":"box","text":"hostility between China and Taiwan would likely have a significant adverse impact on the value of the Fund’s","page_number":72,"box":{"x":69,"y":385,"width":769,"height":11}},{"id":"147d903b-eda9-44f1-a380-49ee82b25db6","block_type":"box","text":"investments in both countries and the region. In addition, China has strained international relations with Japan, India,","page_number":72,"box":{"x":70,"y":400,"width":836,"height":11}},{"id":"178ae50c-84cf-4ea0-a2cb-31eeaeea897d","block_type":"box","text":"the Philippines and other neighbors due to territorial disputes, historical animosities and other defense concerns.","page_number":72,"box":{"x":68,"y":415,"width":810,"height":11}},{"id":"baa36112-c752-40c7-8148-3fd2d03cb207","block_type":"box","text":"Frictions between China and the Philippines in the South China Sea pose a risk of escalation potentially leading to","page_number":72,"box":{"x":70,"y":430,"width":813,"height":11}},{"id":"4ab22dd0-d668-45e7-8f08-fe6b38981392","block_type":"box","text":"military conflict. Additionally, China is alleged to have participated in state-sponsored cyberattacks against foreign","page_number":72,"box":{"x":69,"y":445,"width":811,"height":12}},{"id":"0f0f75df-6c12-4f44-b7f0-0b363df33977","block_type":"box","text":"companies and foreign governments. Actual and threatened responses to such activity and strained international","page_number":72,"box":{"x":69,"y":460,"width":804,"height":12}},{"id":"bb88045a-4f69-423a-9b04-57d94a8e9974","block_type":"box","text":"relations, including purchasing restrictions, sanctions, tariffs or cyberattacks on the Chinese government or Chinese","page_number":72,"box":{"x":69,"y":475,"width":829,"height":12}},{"id":"b67ca093-75c5-4aa4-b071-817a44442fc4","block_type":"box","text":"companies, may impact China’s economy and Chinese issuers of securities in which a Fund invests. China could be","page_number":72,"box":{"x":69,"y":491,"width":825,"height":11}},{"id":"5712b75a-d9f7-42d4-a045-4dcc84f5922b","block_type":"box","text":"affected by military events on the Korean peninsula or internal instability within North Korea. These situations may","page_number":72,"box":{"x":69,"y":506,"width":819,"height":11}},{"id":"7a5268a7-27cb-463c-b628-840dd288eadf","block_type":"box","text":"cause uncertainty in the Chinese market and may adversely affect the performance of the Chinese economy.","page_number":72,"box":{"x":69,"y":521,"width":776,"height":11}},{"id":"cc85565e-426f-4856-b2e9-1321f9f8f0c1","block_type":"box","text":"The Chinese government has implemented economic reforms in order to liberalize trade policy, promote foreign","page_number":72,"box":{"x":101,"y":543,"width":792,"height":12}},{"id":"a5badf72-0284-40c0-8164-9213a9dc2502","block_type":"box","text":"investment in the economy, reduce government control of the economy and develop market mechanisms. However,","page_number":72,"box":{"x":70,"y":559,"width":818,"height":11}},{"id":"b0518267-d304-44bc-8e56-17bd9a808487","block_type":"box","text":"the Chinese government still exercises substantial influence over many aspects of the private sector and may own or","page_number":72,"box":{"x":68,"y":574,"width":835,"height":11}},{"id":"41ad5912-478e-4468-853f-d6b2121f4313","block_type":"box","text":"control many companies. Chinese companies, such as those in the financial services or technology sectors, and","page_number":72,"box":{"x":69,"y":589,"width":802,"height":11}},{"id":"fd310bc3-bf0d-46ee-974b-942d30372d7e","block_type":"box","text":"potentially other sectors in the future, are subject to the risk that Chinese authorities can intervene in their","page_number":72,"box":{"x":70,"y":604,"width":763,"height":11}},{"id":"f819f40e-38b8-40f9-ad2f-adc010678ba1","block_type":"box","text":"operations and structure. The Chinese government continues to maintain a major role in economic policymaking and","page_number":72,"box":{"x":69,"y":619,"width":829,"height":11}},{"id":"79ac50aa-f5d6-4467-9eca-9fd6f1068cda","block_type":"box","text":"investing in China involves risk of loss due to expropriation, nationalization, confiscation of assets and property or","page_number":72,"box":{"x":70,"y":634,"width":813,"height":12}},{"id":"2b79f7df-0598-468b-8c21-29a2cca06931","block_type":"box","text":"the imposition of restrictions on foreign investments and on repatriation of capital invested.","page_number":72,"box":{"x":68,"y":649,"width":653,"height":12}},{"id":"ce4ee579-d3b1-4c10-a650-0ea6846bc9ab","block_type":"box","text":"The Chinese government may intervene in the Chinese financial markets, such as by the imposition of trading","page_number":72,"box":{"x":101,"y":672,"width":783,"height":11}},{"id":"30b86770-99da-452c-8c6b-a19e2810c0d8","block_type":"box","text":"restrictions, a ban on “naked” short selling or the suspension of short selling for certain stocks. This may affect","page_number":72,"box":{"x":69,"y":687,"width":805,"height":11}},{"id":"b0cc12ad-cb5e-47a7-bee7-dc0cc536f197","block_type":"box","text":"market price and liquidity of these stocks, and may have an unpredictable impact on the investment activities of the","page_number":72,"box":{"x":69,"y":702,"width":827,"height":11}},{"id":"d1c60846-26d5-4a19-9c7b-e9e36ec7f09a","block_type":"box","text":"Funds. Furthermore, such market interventions may have a negative impact on market sentiment which may in turn","page_number":72,"box":{"x":70,"y":718,"width":821,"height":11}},{"id":"db144482-8473-4b41-9f7f-8cc5656d693c","block_type":"box","text":"affect the performance of the securities markets and as a result the performance of the Funds.","page_number":72,"box":{"x":69,"y":732,"width":683,"height":11}},{"id":"936b6631-1d98-4b99-87a9-a176ac63c302","block_type":"box","text":"In addition, there is less regulation and monitoring of Chinese securities markets and the activities of investors,","page_number":72,"box":{"x":102,"y":755,"width":797,"height":11}},{"id":"18fa3138-d627-4de6-b69a-4cc70f7e0c93","block_type":"box","text":"brokers and other participants than in the United States. Accordingly, issuers of securities in China, including","page_number":72,"box":{"x":69,"y":770,"width":779,"height":12}},{"id":"86cf2bc3-065b-44c6-9410-475518b1b0bc","block_type":"box","text":"Chinese companies that are listed on U.S. exchanges, are not subject to the same degree of regulation as are U.S.","page_number":72,"box":{"x":69,"y":785,"width":822,"height":12}},{"id":"6c919c95-67c8-46e9-99b4-fc069ffa40c8","block_type":"box","text":"issuers with respect to such matters as insider trading rules, tender offer regulation, accounting standards or auditor","page_number":72,"box":{"x":70,"y":801,"width":836,"height":11}},{"id":"db851c3f-b76d-4751-83e0-06e964006136","block_type":"box","text":"oversight, stockholder proxy requirements and the requirements mandating timely and accurate disclosure of","page_number":72,"box":{"x":69,"y":816,"width":778,"height":11}},{"id":"df43b316-709e-42d0-956f-9d4d50485aa8","block_type":"box","text":"information. Securities markets in China are in the process of change and further development. This may lead to","page_number":72,"box":{"x":70,"y":831,"width":803,"height":11}},{"id":"1a5dda62-d7d8-4957-b27d-69f2ae415542","block_type":"box","text":"trading volatility, difficulty in the settlement and recording of transactions and difficulty in interpreting and applying","page_number":72,"box":{"x":68,"y":846,"width":816,"height":11}},{"id":"81cd2415-e354-44de-8b8f-1661621b4bb7","block_type":"box","text":"the relevant regulation. Custodians may not be able to offer the level of service and safe-keeping in relation to the","page_number":72,"box":{"x":68,"y":861,"width":816,"height":11}},{"id":"e0b1b4ee-7137-47aa-9f29-65c390235daf","block_type":"box","text":"settlement and administration of securities in China that is customary in more developed markets. In particular,","page_number":72,"box":{"x":69,"y":876,"width":798,"height":11}},{"id":"2ebb96af-7308-4403-b151-45445606b064","block_type":"box","text":"there is a risk that a Fund may not be recognized as the owner of securities that are held on behalf of the Fund by a","page_number":72,"box":{"x":68,"y":891,"width":826,"height":12}},{"id":"4dc563ae-10f8-4138-a50c-f66f3032d56f","block_type":"box","text":"sub-custodian.","page_number":72,"box":{"x":69,"y":907,"width":102,"height":8}},{"id":"8a71fff7-25c9-46a7-8dea-f237e411b2fc","block_type":"box","text":"II-41","page_number":72,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"86cf4a99-35b2-4788-a133-a872f800c39b","block_type":"box","text":"NM0926U-5977317-72/232","page_number":72,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"56ca0ec6-8228-47d7-8809-55aae4fd69a2","block_type":"box","text":"There may be significant obstacles to obtaining information necessary for investigations into or litigation against","page_number":73,"box":{"x":101,"y":45,"width":801,"height":11}},{"id":"ce1d69cd-f91e-4a1c-8203-4952851c51e4","block_type":"box","text":"Chinese companies, and shareholders may have limited legal remedies. The Funds do not select investments based","page_number":73,"box":{"x":69,"y":60,"width":829,"height":11}},{"id":"9768ac07-6638-46d8-95eb-fa4411267ece","block_type":"box","text":"on investor protection considerations.","page_number":73,"box":{"x":69,"y":75,"width":268,"height":11}},{"id":"d959a44d-f305-400e-a3e6-e8b5443f618c","block_type":"box","text":"The Chinese government historically took positions that prevented the U.S. Public Company Accounting Oversight","page_number":73,"box":{"x":101,"y":98,"width":806,"height":11}},{"id":"ff5b0d77-ace5-4b79-aba5-77698532c6c5","block_type":"box","text":"Board (“PCAOB”) from inspecting the audit work and practices of accounting firms in mainland China and Hong Kong","page_number":73,"box":{"x":70,"y":113,"width":829,"height":11}},{"id":"c35ff5c9-682c-4d07-89a7-c2d847c71a1f","block_type":"box","text":"for compliance with U.S. law and professional standards. On August 26, 2022, the PCAOB signed a Statement of","page_number":73,"box":{"x":68,"y":128,"width":810,"height":11}},{"id":"32ab487d-d311-4f41-9115-72312d5681bf","block_type":"box","text":"Protocol with the China Securities Regulatory Commission and the Ministry of Finance of the PRC, which marked the","page_number":73,"box":{"x":69,"y":143,"width":829,"height":11}},{"id":"93573c32-5607-4007-9ca7-87a5b076c08e","block_type":"box","text":"first step toward opening access for the PCAOB to inspect and investigate registered public accounting firms","page_number":73,"box":{"x":68,"y":158,"width":774,"height":11}},{"id":"e08bb48d-7c13-4655-bf49-426237636c27","block_type":"box","text":"headquartered in mainland China and Hong Kong completely in accordance with U.S. law. However, as this","page_number":73,"box":{"x":69,"y":173,"width":760,"height":11}},{"id":"8f29f84a-1753-4848-b244-e02bcc50df16","block_type":"box","text":"development is relatively recent, the implementation of the Statement of Protocol remains to be tested. Audits","page_number":73,"box":{"x":69,"y":188,"width":788,"height":11}},{"id":"2b0c570a-90e6-451b-9177-9907d9db2a55","block_type":"box","text":"performed by PCAOB-registered accounting firms in mainland China and Hong Kong may be less reliable than those","page_number":73,"box":{"x":70,"y":203,"width":822,"height":12}},{"id":"8e414ee7-5c40-4001-9911-d1a499f99c40","block_type":"box","text":"performed by firms subject to PCAOB inspection. Accordingly, information about the Chinese securities in which the","page_number":73,"box":{"x":70,"y":218,"width":821,"height":12}},{"id":"06e9ab46-2963-4123-aafe-acdc917bc270","block_type":"box","text":"Funds invest may be less reliable or complete. Under amendments to the Sarbanes-Oxley Act enacted in December","page_number":73,"box":{"x":70,"y":234,"width":820,"height":11}},{"id":"9dcea7f7-a6a3-4f5a-bd44-8f8c455a7633","block_type":"box","text":"2020, which requires that the PCAOB be permitted to inspect the accounting firm of a U.S.-listed Chinese issuer,","page_number":73,"box":{"x":69,"y":249,"width":805,"height":11}},{"id":"5cebff37-f4a8-43cd-a047-dacb8bde3fa3","block_type":"box","text":"Chinese companies with securities listed on U.S. exchanges may be delisted if the PCAOB is unable to inspect the","page_number":73,"box":{"x":69,"y":264,"width":816,"height":11}},{"id":"bb91ad1e-00bc-4222-8e71-042cd79ef3cd","block_type":"box","text":"accounting firm.","page_number":73,"box":{"x":69,"y":279,"width":112,"height":11}},{"id":"ff651bba-9988-419f-bf88-889c3ea3be01","block_type":"box","text":"The Renminbi (“RMB”) is currently not a freely convertible currency and is subject to foreign exchange control","page_number":73,"box":{"x":101,"y":302,"width":780,"height":11}},{"id":"0585a32a-9a3d-499f-9557-3cf2fadf7add","block_type":"box","text":"policies and repatriation restrictions imposed by the Chinese government. The imposition of currency controls may","page_number":73,"box":{"x":70,"y":317,"width":815,"height":11}},{"id":"37ddbd26-2a4f-4f4a-b409-37aceb9f7cee","block_type":"box","text":"negatively impact performance and liquidity of the Funds as capital may become trapped in the PRC. The Funds could","page_number":73,"box":{"x":69,"y":332,"width":837,"height":11}},{"id":"8dd68c44-5955-4a9b-a472-009211212747","block_type":"box","text":"be adversely affected by delays in, or a refusal to grant, any required governmental approval for repatriation of","page_number":73,"box":{"x":69,"y":347,"width":787,"height":11}},{"id":"3722e606-a383-4153-b6e7-c1d96d957cda","block_type":"box","text":"capital, as well as by the application to the Funds of any restrictions on investments. Investing in entities either in, or","page_number":73,"box":{"x":69,"y":362,"width":837,"height":11}},{"id":"1228711a-5a0c-46c0-be48-e74a18cc5041","block_type":"box","text":"which have a substantial portion of their operations in, the PRC may require the Funds to adopt special procedures,","page_number":73,"box":{"x":68,"y":377,"width":825,"height":11}},{"id":"b8f33052-bcdd-4f97-a95a-cca599f1cc89","block_type":"box","text":"seek local government approvals or take other actions, each of which may involve additional costs and delays to the","page_number":73,"box":{"x":69,"y":392,"width":828,"height":12}},{"id":"e43d4d1f-0b8d-40a8-8b35-d0c303aa72d3","block_type":"box","text":"Funds. The Fund may also incur costs in connection with conversions between U.S. dollars and RMB, as well as in","page_number":73,"box":{"x":70,"y":408,"width":812,"height":11}},{"id":"f3d62b6d-7a6d-4d2f-ad0a-2f7534831446","block_type":"box","text":"connection with conversions between the two separate types of RMB, the onshore RMB (“CNY”) and the offshore","page_number":73,"box":{"x":69,"y":423,"width":808,"height":11}},{"id":"d1e82217-f182-47a6-99d5-a2ad9d44fb7e","block_type":"box","text":"RMB (“CNH”).","page_number":73,"box":{"x":70,"y":438,"width":97,"height":11}},{"id":"cfad7883-0506-4091-b837-21aff2266123","block_type":"box","text":"Many Chinese companies listed on U.S. exchanges use variable interest entities or “VIEs” in their structure as a","page_number":73,"box":{"x":102,"y":460,"width":802,"height":12}},{"id":"707faa9d-ea4b-4644-bf4c-f24a4cf90553","block_type":"box","text":"result of foreign ownership restrictions. In a VIE structure, a Chinese operating company establishes a shell company","page_number":73,"box":{"x":69,"y":475,"width":837,"height":12}},{"id":"dfd77e6c-09c0-417f-b8a1-606e2d1d5769","block_type":"box","text":"in another jurisdiction to issue stock to public shareholders. When a VIE structure is used by a Chinese company to","page_number":73,"box":{"x":70,"y":491,"width":822,"height":11}},{"id":"5827efed-4c52-4f56-8063-7f365fb30a80","block_type":"box","text":"list its stock in the U.S., instead of owning the equity securities of the Chinese company, the U.S.-listed shell","page_number":73,"box":{"x":70,"y":506,"width":775,"height":11}},{"id":"f0899515-5e5d-4eeb-9c79-94a6bff04eec","block_type":"box","text":"company directly or indirectly enters into contracts with the Chinese operating company under Chinese law. These","page_number":73,"box":{"x":69,"y":521,"width":809,"height":11}},{"id":"d3656641-5493-425e-a3c0-f02c4670446e","block_type":"box","text":"contracts provide the U.S.-listed shell company with only economic exposure to the Chinese company and do not","page_number":73,"box":{"x":69,"y":536,"width":803,"height":11}},{"id":"9d382854-55cd-4e82-ac48-cb3dca3ad8ad","block_type":"box","text":"represent equity ownership in the operating company.","page_number":73,"box":{"x":69,"y":551,"width":380,"height":11}},{"id":"c0a407cc-38b8-4e75-9cc4-6bcee8030306","block_type":"box","text":"While VIEs are a longstanding practice that is well known to Chinese officials and regulators, they have not been","page_number":73,"box":{"x":101,"y":574,"width":801,"height":11}},{"id":"973b5387-a81d-4245-b9c1-b5b0b5af33b2","block_type":"box","text":"formally recognized under Chinese law. The Chinese government has provided guidance to and placed restrictions on","page_number":73,"box":{"x":68,"y":589,"width":833,"height":11}},{"id":"c7ec2710-7a3a-41b0-8900-88e4af552d78","block_type":"box","text":"Chinese-based companies raising capital offshore, including through VIEs. In 2023, the China Securities Regulatory","page_number":73,"box":{"x":69,"y":604,"width":825,"height":11}},{"id":"73f8b757-6d48-4224-a885-632d28e6f474","block_type":"box","text":"Commission (“CSRC”) released new rules that permit the use of VIE structures, provided they abide by Chinese laws","page_number":73,"box":{"x":69,"y":619,"width":832,"height":11}},{"id":"c4aec51d-1844-43b8-950b-5a0d758ff96d","block_type":"box","text":"and register with the CSRC. The rules, however, may cause Chinese companies to undergo greater scrutiny and add","page_number":73,"box":{"x":69,"y":634,"width":826,"height":12}},{"id":"d67e065f-a7ba-4de9-b510-b331e567c0de","block_type":"box","text":"costs to VIE structures. Intervention, rulemaking or guidance by the Chinese government with respect to VIE","page_number":73,"box":{"x":69,"y":649,"width":770,"height":12}},{"id":"1c8b15d6-5327-43b3-8189-c19573a3ba3f","block_type":"box","text":"structures or the non-enforcement of VIE-related contractual rights could significantly affect the operating company’s","page_number":73,"box":{"x":69,"y":664,"width":829,"height":12}},{"id":"f22855a9-4671-4b76-b196-1d31e73c401f","block_type":"box","text":"business in China, the enforceability of the U.S.-listed shell company’s contractual arrangements with the Chinese","page_number":73,"box":{"x":69,"y":680,"width":815,"height":11}},{"id":"7981dafb-fedd-4b43-af43-edbb6997b67a","block_type":"box","text":"company and the value of the U.S.-listed stock. Further, the VIE contractual arrangement would likely be subject to","page_number":73,"box":{"x":69,"y":695,"width":815,"height":11}},{"id":"9b4684d7-f319-4c3f-8533-7755b1ef1de3","block_type":"box","text":"Chinese law and jurisdiction, and remedies available to the U.S.-listed shell company are uncertain and could be","page_number":73,"box":{"x":69,"y":710,"width":802,"height":11}},{"id":"9b3cc4b6-2996-4eac-b302-8b465b446090","block_type":"box","text":"ineffective. In addition to the risk of government intervention, investments through a VIE structure are subject to the","page_number":73,"box":{"x":70,"y":725,"width":828,"height":11}},{"id":"e2babc3a-bd71-424e-9363-420884589326","block_type":"box","text":"risk that the China-based company (or its officers, directors, or Chinese equity owners) may breach those contractual","page_number":73,"box":{"x":69,"y":740,"width":833,"height":11}},{"id":"1e3fe7ef-c1e4-4c55-99c7-dc6e4c32bffb","block_type":"box","text":"arrangements, or Chinese law changes in a way that adversely affects the enforceability of these arrangements, or","page_number":73,"box":{"x":69,"y":755,"width":819,"height":11}},{"id":"89c47c15-6450-4f79-8d09-d88db8d7c05e","block_type":"box","text":"those contracts are otherwise not enforceable under Chinese law, in which case the Fund may suffer significant","page_number":73,"box":{"x":68,"y":770,"width":798,"height":12}},{"id":"b80b0cc2-4f75-45da-b2be-54158e094847","block_type":"box","text":"losses on its investments through a VIE structure with little or no recourse available. Any change in the operations of","page_number":73,"box":{"x":70,"y":785,"width":833,"height":12}},{"id":"41407e4a-d201-4cd0-beca-18a3905184af","block_type":"box","text":"entities in a VIE structure, the status of VIE contractual arrangements or the legal or regulatory environment in China,","page_number":73,"box":{"x":69,"y":801,"width":837,"height":11}},{"id":"23d892eb-6400-4e0f-860e-b4861e178c69","block_type":"box","text":"generally or with respect to specific industries, could result in significant, and possibly permanent and/or total,","page_number":73,"box":{"x":68,"y":816,"width":792,"height":11}},{"id":"8e9b531c-28db-4e76-9432-87fe42975e0f","block_type":"box","text":"losses to a Fund.","page_number":73,"box":{"x":70,"y":831,"width":120,"height":9}},{"id":"bea4a5c9-bb5d-4ff0-aa96-8881233f3495","block_type":"box","text":"While the Chinese economy has experienced past periods of rapid growth, there is no assurance that such","page_number":73,"box":{"x":101,"y":853,"width":760,"height":12}},{"id":"8f2f2b5e-c646-411f-bcd9-3f9073054cb3","block_type":"box","text":"growth rates will recur. Other economic challenges for China include indebtedness, weak consumer demand, trade","page_number":73,"box":{"x":68,"y":869,"width":815,"height":11}},{"id":"a0f21382-e26c-460b-8302-afb1ed0160c0","block_type":"box","text":"tensions, and an aging population. China continues to face pressure from its trading partners over its exporting of its","page_number":73,"box":{"x":68,"y":884,"width":837,"height":11}},{"id":"8d29361e-5cb9-4aec-bd4c-0c523056b6cd","block_type":"box","text":"excess industrial capacity and overall approach to economic management. China’s economy is heavily dependent on","page_number":73,"box":{"x":69,"y":899,"width":830,"height":11}},{"id":"f8beeb21-550d-4154-ab36-72a9da0e1434","block_type":"box","text":"II-42","page_number":73,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"ee149067-608d-4bc6-81ec-222234de28d9","block_type":"box","text":"NM0926U-5977317-73/232","page_number":73,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"b4f13343-5a4b-4522-8a64-6688db0ae7e6","block_type":"box","text":"export growth. Reduction in spending on Chinese products and services, supply chain diversification, institution of","page_number":74,"box":{"x":69,"y":45,"width":815,"height":11}},{"id":"7b4dcc03-8ec8-4c38-b3d8-75784199d1de","block_type":"box","text":"additional tariffs, sanctions or other trade barriers (including as a result of heightened trade tensions between China","page_number":74,"box":{"x":69,"y":60,"width":832,"height":11}},{"id":"73973122-1612-4eae-ae58-1494fc05ffab","block_type":"box","text":"and the United States or in response to actual or alleged Chinese cyber activity) or a downturn in any of the","page_number":74,"box":{"x":69,"y":75,"width":765,"height":11}},{"id":"bebbbd4d-3401-4b23-802d-f93784ce70ea","block_type":"box","text":"economies of China’s key trading partners may have an adverse impact on the Chinese economy and the companies","page_number":74,"box":{"x":69,"y":90,"width":833,"height":11}},{"id":"03793a9b-ab73-44b8-826f-4ccb953d72af","block_type":"box","text":"in which a Fund invests. Certain Chinese companies (which may change from time to time) are directly or indirectly","page_number":74,"box":{"x":70,"y":105,"width":816,"height":11}},{"id":"d76eb470-6930-40b2-bd44-f0d028783b49","block_type":"box","text":"subject to economic or trade restrictions imposed by the U.S. or other governments due to national security, human","page_number":74,"box":{"x":69,"y":120,"width":824,"height":12}},{"id":"daa98551-ea4b-4ef7-8302-8010feea89ab","block_type":"box","text":"rights or other concerns of such government. For example, certain foreign technology companies are subject to U.S.","page_number":74,"box":{"x":69,"y":135,"width":825,"height":12}},{"id":"2c2ffbc2-54a8-4c64-b8fa-f0611afa4cf8","block_type":"box","text":"export controls as those companies are believed to pose a risk to U.S. interests. The U.S. also bans imports of","page_number":74,"box":{"x":69,"y":150,"width":798,"height":11}},{"id":"8d9fe7fa-1794-4ec3-ad98-6ade8ba7868c","block_type":"box","text":"goods produced in certain regions of China or by certain Chinese companies due to concerns about forced labor.","page_number":74,"box":{"x":68,"y":166,"width":805,"height":11}},{"id":"5ef568c0-61de-4c14-9309-97903191130a","block_type":"box","text":"Such restrictions may have unanticipated and adverse effects on the Chinese economy and companies. Any action","page_number":74,"box":{"x":69,"y":181,"width":817,"height":11}},{"id":"cca57b71-358e-4701-a7f8-1dddac6e94df","block_type":"box","text":"that targets Chinese financial markets or securities exchanges could interfere with orderly trading, delay settlement","page_number":74,"box":{"x":68,"y":196,"width":825,"height":11}},{"id":"43effc13-c64a-44c9-b1ff-ab84abb57b95","block_type":"box","text":"or cause market disruptions. Certain companies may be subject to economic or trade restrictions (but not investment","page_number":74,"box":{"x":69,"y":211,"width":839,"height":11}},{"id":"f34d957f-1e92-4965-8b63-19bc64ef7a56","block_type":"box","text":"restrictions) imposed by the U.S. or other governments due to national security, human rights or other concerns of","page_number":74,"box":{"x":69,"y":226,"width":815,"height":11}},{"id":"5baff244-ab60-4a2f-aaab-4a40922a343b","block_type":"box","text":"such government. So long as these restrictions do not include restrictions on investments, the Fund may invest in","page_number":74,"box":{"x":69,"y":241,"width":812,"height":11}},{"id":"81bc4424-539c-405e-8c61-25766011bd3b","block_type":"box","text":"such companies.","page_number":74,"box":{"x":69,"y":257,"width":119,"height":10}},{"id":"85b45b33-5eaf-44b2-9ded-d4ea34f08747","block_type":"box","text":"The tax laws and regulations in the PRC are subject to change, including the issuance of authoritative guidance","page_number":74,"box":{"x":101,"y":279,"width":792,"height":11}},{"id":"e0c3521e-1f8e-4834-8928-6b0f6d2d550b","block_type":"box","text":"or enforcement, possibly with retroactive effect. The interpretation, applicability and enforcement of such laws by PRC","page_number":74,"box":{"x":69,"y":294,"width":840,"height":11}},{"id":"015ca971-1c1e-4834-95d2-c6f46e270f93","block_type":"box","text":"tax authorities are not as consistent and transparent as those of more developed nations, and may vary over time","page_number":74,"box":{"x":68,"y":309,"width":815,"height":11}},{"id":"eca297e6-b408-487d-aed7-702084b21250","block_type":"box","text":"and from region to region. The application and enforcement of PRC tax rules could have a significant adverse effect","page_number":74,"box":{"x":69,"y":324,"width":823,"height":12}},{"id":"1d7f8c3f-1fbe-4b7f-a44e-eb73211c792f","block_type":"box","text":"on a Fund and its investors, particularly in relation to capital gains withholding tax imposed upon non-residents. In","page_number":74,"box":{"x":69,"y":340,"width":812,"height":11}},{"id":"605e53be-f378-45d5-96b2-6202879f2b5e","block_type":"box","text":"addition, the accounting, auditing and financial reporting standards and practices applicable to Chinese companies","page_number":74,"box":{"x":69,"y":355,"width":821,"height":11}},{"id":"499d2af8-b79f-4c16-b044-ab8b1ea96e0f","block_type":"box","text":"may be less rigorous, and may result in significant differences between financial statements prepared in accordance","page_number":74,"box":{"x":69,"y":370,"width":832,"height":11}},{"id":"d6d1f13e-d0c2-40e9-b43c-82dc208ed38a","block_type":"box","text":"with PRC accounting standards and practice and those prepared in accordance with international accounting","page_number":74,"box":{"x":68,"y":385,"width":773,"height":11}},{"id":"9c5045db-d928-4b2f-bcea-3efd80e5c00b","block_type":"box","text":"standards.","page_number":74,"box":{"x":69,"y":400,"width":74,"height":9}},{"id":"d888efc7-1bc2-4411-bdb8-45384dd7423f","block_type":"box","text":"From time to time and in recent years, China has experienced outbreaks of infectious illnesses and the country","page_number":74,"box":{"x":102,"y":423,"width":794,"height":11}},{"id":"1e8ea9c1-a626-4544-80f0-5b0a6fb59994","block_type":"box","text":"may be subject to other public health threats, infectious illnesses, diseases or similar issues in the future. Any","page_number":74,"box":{"x":69,"y":438,"width":792,"height":11}},{"id":"b5cde1c3-801f-49e0-9a25-87a01c929e6e","block_type":"box","text":"spread of an infectious illness, public health threat or similar issue could reduce consumer demand or economic","page_number":74,"box":{"x":69,"y":453,"width":803,"height":11}},{"id":"bcb6a9b2-11b4-4c4f-9542-c6ffbcbd1d14","block_type":"box","text":"output, result in market closures, travel restrictions or quarantines, and generally have a significant impact on the","page_number":74,"box":{"x":69,"y":468,"width":811,"height":11}},{"id":"74674d9e-df3f-4c3d-af63-39ca25399374","block_type":"box","text":"Chinese economy, which in turn could adversely affect a Fund’s investments.","page_number":74,"box":{"x":69,"y":483,"width":548,"height":11}},{"id":"ce1979ea-5235-4141-8112-d70b0d4974b0","block_type":"box","text":"Risk of Investing through Stock Connect.","page_number":74,"box":{"x":102,"y":506,"width":288,"height":11}},{"id":"b8642216-b682-47a6-850f-a411fff23fba","block_type":"box","text":"General","page_number":74,"box":{"x":102,"y":529,"width":55,"height":8}},{"id":"3c9b72bf-9454-4229-b8bc-d92ca832c25d","block_type":"box","text":". China A-shares are equity securities of companies domiciled in China that trade on Chinese stock","page_number":74,"box":{"x":158,"y":528,"width":704,"height":12}},{"id":"9adf6fd6-3959-42a9-8b7d-45966713288e","block_type":"box","text":"exchanges such as the Shanghai Stock Exchange (“SSE”), the Shenzhen Stock Exchange (“SZSE”) and the Beijing","page_number":74,"box":{"x":69,"y":544,"width":815,"height":11}},{"id":"eb82a379-5398-4e75-b6ec-3bcda59f7b10","block_type":"box","text":"Stock Exchange (“BSE”) (“A-shares”). Foreign investment in A-shares on the SSE and SZSE is not permitted, other","page_number":74,"box":{"x":69,"y":559,"width":815,"height":11}},{"id":"44a8c344-1a2c-4d1c-99e3-15e3aa55dbd7","block_type":"box","text":"than pursuant to available exceptions, such as through a qualified foreign investor approved pursuant to the relevant","page_number":74,"box":{"x":68,"y":574,"width":833,"height":11}},{"id":"5629cf87-c9d7-4119-9e73-294c9bf3f599","block_type":"box","text":"mainland China laws and regulations as may be promulgated and/or amended from time to time (“QFI”).","page_number":74,"box":{"x":69,"y":589,"width":744,"height":11}},{"id":"4b7ba8af-12cc-4288-a7f5-f8038c7deaa8","block_type":"box","text":"Investment in eligible exchange traded funds and A-shares listed and traded on the SSE or SZSE (“Stock","page_number":74,"box":{"x":102,"y":612,"width":745,"height":11}},{"id":"5be3eafa-b456-47a3-8a2d-b556375dafe8","block_type":"box","text":"Connect Securities”) is also permitted through the Shanghai-Hong Kong Stock Connect program or the Shenzhen","page_number":74,"box":{"x":69,"y":627,"width":807,"height":11}},{"id":"90a594d0-702c-498c-9bb4-3acaf921f8ab","block_type":"box","text":"Hong Kong Stock Connect program, as applicable (each, a “Stock Connect” and collectively, “Stock Connects”). Each","page_number":74,"box":{"x":70,"y":642,"width":834,"height":11}},{"id":"a601720e-67c9-42a8-9507-cc0c528d3c80","block_type":"box","text":"Stock Connect is a securities trading and clearing links program established by The Stock Exchange of Hong Kong","page_number":74,"box":{"x":69,"y":657,"width":812,"height":11}},{"id":"1e785c25-3825-4bc0-85ef-a7b937192074","block_type":"box","text":"Limited (“SEHK”), the Hong Kong Securities Clearing Company Limited (“HKSCC”), the SSE or SZSE, as applicable,","page_number":74,"box":{"x":70,"y":672,"width":819,"height":11}},{"id":"02b0b76b-f3dc-4d10-9740-db3f065ffb4b","block_type":"box","text":"and China Securities Depository and Clearing Corporation Limited (“CSDCC”) that aims to provide mutual stock","page_number":74,"box":{"x":69,"y":687,"width":793,"height":11}},{"id":"1528bbef-9b65-4f15-a038-a470e45c248b","block_type":"box","text":"market access between the PRC and Hong Kong by permitting investors to trade and settle shares on each market","page_number":74,"box":{"x":69,"y":702,"width":818,"height":12}},{"id":"626e4f3e-f097-4050-9d5f-35c60a850080","block_type":"box","text":"through their local securities brokers. Under Stock Connects, a Fund’s trading of Stock Connect Securities listed on","page_number":74,"box":{"x":68,"y":717,"width":824,"height":12}},{"id":"919fbac4-07db-463b-a4e4-08435b8daa17","block_type":"box","text":"the SSE or SZSE, as applicable, would be effectuated through its Hong Kong broker and a securities trading service","page_number":74,"box":{"x":68,"y":732,"width":827,"height":12}},{"id":"0d17f9ce-e569-4f72-9db6-f7d7669f3ddc","block_type":"box","text":"company established by SEHK.","page_number":74,"box":{"x":69,"y":748,"width":219,"height":11}},{"id":"9dba56b9-3866-4b8e-b010-016cd8f8a6a5","block_type":"box","text":"Although no individual investment quotas or licensing requirements apply to investors in Stock Connect, trading","page_number":74,"box":{"x":101,"y":770,"width":794,"height":12}},{"id":"3adc0d6e-73c1-4977-a508-72ab5fa5550d","block_type":"box","text":"through a Stock Connect’s Northbound Trading Link is subject to daily investment quota limitations which require that","page_number":74,"box":{"x":68,"y":786,"width":839,"height":11}},{"id":"79a4de14-4432-4889-bec1-51aa1ef1851f","block_type":"box","text":"buy orders for Stock Connect Securities be rejected once the daily quota is exceeded (although a Fund will be","page_number":74,"box":{"x":69,"y":801,"width":779,"height":11}},{"id":"2cc20902-20ab-4771-b0aa-54492da62709","block_type":"box","text":"permitted to sell their Stock Connect Securities regardless of the quota). These limitations may restrict a Fund from","page_number":74,"box":{"x":70,"y":816,"width":824,"height":11}},{"id":"dfd86292-0703-4894-8ac5-052bd4cf1041","block_type":"box","text":"investing in Stock Connect Securities on a timely basis, which could affect the Fund’s ability to effectively pursue its","page_number":74,"box":{"x":70,"y":831,"width":827,"height":11}},{"id":"bd14c97c-98e2-4c94-96ae-63ee0f26ff11","block_type":"box","text":"investment strategy. Investment quotas are also subject to change. Investment in Stock Connect Securities through a","page_number":74,"box":{"x":70,"y":846,"width":837,"height":11}},{"id":"5c56afbc-d0e1-4693-9f99-1f7ca8d416c3","block_type":"box","text":"Stock Connect is subject to trading, clearance and settlement procedures that could pose risks to a Fund. Stock","page_number":74,"box":{"x":69,"y":861,"width":802,"height":11}},{"id":"9a23fcdf-119d-4000-abc9-cd12367dd78b","block_type":"box","text":"Connect Securities purchased through Stock Connects generally may not be sold or otherwise transferred other than","page_number":74,"box":{"x":69,"y":876,"width":831,"height":11}},{"id":"fbe2adb8-f1df-4725-8dac-84861168da1e","block_type":"box","text":"through Stock Connects in accordance with applicable rules. For example, the PRC regulations require that in order","page_number":74,"box":{"x":68,"y":891,"width":821,"height":12}},{"id":"b8eae5e7-4662-4e1e-986f-54486f45e272","block_type":"box","text":"for an investor to sell any Stock Connect Securities on a certain trading day, there must be sufficient Stock Connect","page_number":74,"box":{"x":68,"y":906,"width":829,"height":12}},{"id":"92a8a286-96de-4855-addf-1f765fd754a6","block_type":"box","text":"II-43","page_number":74,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"0bfc849b-f499-4b88-8c7c-da11d1aa1f15","block_type":"box","text":"NM0926U-5977317-74/232","page_number":74,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"4b96d9f7-d523-430c-9856-7da2b23c96fb","block_type":"box","text":"Securities in the investor’s account before the market opens on that day. If there are insufficient Stock Connect","page_number":75,"box":{"x":69,"y":45,"width":797,"height":11}},{"id":"5450d6f5-b9d8-4d26-89ae-c7ca72f9dba9","block_type":"box","text":"Securities in the investor’s account, the sell order will be rejected by the SSE or SZSE, as applicable. SEHK carries","page_number":75,"box":{"x":69,"y":60,"width":820,"height":11}},{"id":"ba289a20-9105-42be-a321-809ccca55e08","block_type":"box","text":"out pre-trade checking on sell orders of certain stocks listed on the SSE market (“SSE Securities”) or SZSE market","page_number":75,"box":{"x":69,"y":75,"width":820,"height":11}},{"id":"62c950ce-6842-42c0-a5a4-0f4e6ff05bd8","block_type":"box","text":"(“SZSE Securities”) of its participants (","page_number":75,"box":{"x":69,"y":90,"width":278,"height":11}},{"id":"c58e3d6d-2ec7-4609-879b-6ad3744f4565","block_type":"box","text":"i.e.","page_number":75,"box":{"x":349,"y":90,"width":21,"height":9}},{"id":"c3d3c3c1-5d9f-4d89-a687-4e22e0ba222b","block_type":"box","text":", stock brokers) to ensure that this requirement is satisfied. While shares","page_number":75,"box":{"x":372,"y":90,"width":524,"height":11}},{"id":"ef924a3f-6b93-43fa-b952-608c332f79ad","block_type":"box","text":"must be designated as eligible to be traded under a Stock Connect, those shares may also lose such designation,","page_number":75,"box":{"x":69,"y":105,"width":815,"height":11}},{"id":"61707dda-9912-40ab-8db0-ce8be44912fb","block_type":"box","text":"and if this occurs, such shares may be sold but cannot be purchased through a Stock Connect. In addition, Stock","page_number":75,"box":{"x":69,"y":120,"width":810,"height":12}},{"id":"5407810a-60cb-4bef-ab81-4cd29410ac2b","block_type":"box","text":"Connects will only operate on days when both the Chinese and Hong Kong markets are open for trading, and banking","page_number":75,"box":{"x":69,"y":135,"width":834,"height":12}},{"id":"e1ade967-2361-4e5b-8d88-f2242b090061","block_type":"box","text":"services are available in both markets on the corresponding settlement days. Therefore, an investment in Stock","page_number":75,"box":{"x":69,"y":150,"width":799,"height":12}},{"id":"274e9f52-3519-4a6b-a1cc-22e26655c282","block_type":"box","text":"Connect Securities through a Stock Connect may subject a Fund to a risk of price fluctuations on days when the","page_number":75,"box":{"x":69,"y":166,"width":797,"height":11}},{"id":"240aac49-1c34-4016-b99d-36564792f682","block_type":"box","text":"Chinese market is open, but a Stock Connect is not trading. Moreover, day (turnaround) trading is not permitted on","page_number":75,"box":{"x":69,"y":181,"width":818,"height":11}},{"id":"ae747a0d-6182-42a9-bd6e-2631a046d8e3","block_type":"box","text":"the Stock Connect Securities market. If an investor buys Stock Connect Securities on day “T,” the investor will only","page_number":75,"box":{"x":68,"y":196,"width":820,"height":11}},{"id":"360bfa19-ecef-4e99-9754-267fbee2a893","block_type":"box","text":"be able to sell the Stock Connect Securities on or after day T+1. Further, since all trades of Stock Connect Securities","page_number":75,"box":{"x":69,"y":211,"width":836,"height":11}},{"id":"68f9702d-4e85-4a3a-b535-cd7c89167744","block_type":"box","text":"must be settled in RMB, investors must have timely access to a reliable supply of offshore RMB, which cannot be","page_number":75,"box":{"x":69,"y":226,"width":811,"height":11}},{"id":"d7ef5198-9fe7-4baa-8d61-300609689602","block_type":"box","text":"guaranteed. There is also no assurance that RMB will not be subject to devaluation. Any devaluation of RMB could","page_number":75,"box":{"x":68,"y":241,"width":815,"height":11}},{"id":"8fede697-435e-44b3-9373-15f1208a0e7d","block_type":"box","text":"adversely affect a Fund’s investments. If a Fund holds a class of shares denominated in a local currency other than","page_number":75,"box":{"x":69,"y":256,"width":824,"height":11}},{"id":"85d0efb5-425c-4bb2-b947-0dfc6117f59f","block_type":"box","text":"RMB, the Fund will be exposed to currency exchange risk if the Fund converts the local currency into RMB for","page_number":75,"box":{"x":70,"y":271,"width":777,"height":12}},{"id":"e7e8e096-21d8-4729-a997-31c58117b4be","block_type":"box","text":"investments in Stock Connect Securities. A Fund may also incur conversion costs.","page_number":75,"box":{"x":70,"y":287,"width":582,"height":11}},{"id":"201768d4-e8fa-4c03-bf16-c3ec192866da","block_type":"box","text":"Stock Connect Securities held through the nominee structure under a Stock Connect will be held through HKSCC","page_number":75,"box":{"x":102,"y":309,"width":802,"height":11}},{"id":"8ea79053-e96a-499a-8570-a48ec05cc4d1","block_type":"box","text":"as nominee on behalf of investors. The precise nature and rights of a Fund as the beneficial owner of the SSE","page_number":75,"box":{"x":69,"y":324,"width":784,"height":12}},{"id":"35c55033-5b00-4d2a-8c72-62279a0d85b4","block_type":"box","text":"Securities or SZSE Securities through HKSCC as nominee is not well defined under the PRC laws. There is a lack of a","page_number":75,"box":{"x":69,"y":339,"width":837,"height":12}},{"id":"6fe7674d-cda3-4e2a-96c0-23a77e866577","block_type":"box","text":"clear definition of, and distinction between, legal ownership and beneficial ownership under the PRC laws and there","page_number":75,"box":{"x":69,"y":355,"width":822,"height":11}},{"id":"e15df76d-9d52-4ba6-8a2a-9e5c0a4675e3","block_type":"box","text":"have been few cases involving a nominee account structure in the PRC courts. The exact nature and methods of","page_number":75,"box":{"x":69,"y":370,"width":802,"height":11}},{"id":"3d0d2200-49dd-4beb-ae1e-82abc37e6c2e","block_type":"box","text":"enforcement of the rights and interests of a Fund under the PRC laws is also uncertain. In the unlikely event that","page_number":75,"box":{"x":69,"y":385,"width":805,"height":11}},{"id":"3c0513ac-be95-4dd8-b2c4-045a319af62e","block_type":"box","text":"HKSCC becomes subject to winding up proceedings in Hong Kong, there is a risk that the SSE Securities or SZSE","page_number":75,"box":{"x":70,"y":400,"width":807,"height":11}},{"id":"22610819-b2a3-42f1-9428-10bd8bdbc0a7","block_type":"box","text":"Securities may not be regarded as held for the beneficial ownership of a Fund or as part of the general assets of","page_number":75,"box":{"x":69,"y":415,"width":805,"height":11}},{"id":"6efc4cca-e26b-4ccc-9568-046cefff65fa","block_type":"box","text":"HKSCC available for general distribution to its creditors. Notwithstanding the fact that HKSCC does not claim","page_number":75,"box":{"x":70,"y":430,"width":774,"height":11}},{"id":"6e851304-4f9b-47fb-9afd-433ed62d32ee","block_type":"box","text":"proprietary interests in the SSE Securities or SZSE Securities held in its omnibus stock account in the CSDCC, the","page_number":75,"box":{"x":70,"y":445,"width":816,"height":11}},{"id":"d80e0eea-70dd-494f-b2b3-7480f7a0c711","block_type":"box","text":"CSDCC as the share registrar for SSE- or SZSE-listed companies will still treat HKSCC as one of the shareholders","page_number":75,"box":{"x":69,"y":460,"width":808,"height":12}},{"id":"2fb00e66-f2e7-466d-a01d-f84f5a144d65","block_type":"box","text":"when it handles corporate actions in respect of such SSE Securities or SZSE Securities. HKSCC monitors the","page_number":75,"box":{"x":68,"y":475,"width":779,"height":11}},{"id":"b7366933-157f-4d52-83f1-ca04b4ecef9e","block_type":"box","text":"corporate actions affecting SSE Securities and SZSE Securities and keeps participants of Central Clearing and","page_number":75,"box":{"x":69,"y":491,"width":788,"height":11}},{"id":"07713c44-8c13-47a3-a859-e4f5c2c50b62","block_type":"box","text":"Settlement System (“CCASS”) informed of all such corporate actions that require CCASS participants to take steps in","page_number":75,"box":{"x":69,"y":506,"width":839,"height":11}},{"id":"826518e6-1c56-43ea-8fce-fb15b8bf8442","block_type":"box","text":"order to participate in them. Investors may only exercise their voting rights by providing their voting instructions to","page_number":75,"box":{"x":69,"y":521,"width":811,"height":11}},{"id":"0de9ab54-0c69-4994-8a1c-0305c2550c5c","block_type":"box","text":"HKSCC through participants of CCASS. All voting instructions from CCASS participants will be consolidated by","page_number":75,"box":{"x":70,"y":536,"width":783,"height":11}},{"id":"85cc4c08-eb32-4179-b758-465a218ec2f5","block_type":"box","text":"HKSCC, who will then submit a combined single voting instruction to the relevant SSE- or SZSE-listed company. As a","page_number":75,"box":{"x":70,"y":551,"width":826,"height":11}},{"id":"6ae88ef1-49c6-4bdb-a5a1-9f46f4289a32","block_type":"box","text":"result, a Fund may suffer difficulties or delays in enforcing its rights in SSE Securities or SZSE Securities.","page_number":75,"box":{"x":69,"y":566,"width":752,"height":11}},{"id":"62a24dc5-c4a0-4c4c-9706-37622c2048dc","block_type":"box","text":"Hong Kong’s Investor Compensation Fund is established to pay compensation to investors of any nationality who","page_number":75,"box":{"x":102,"y":589,"width":804,"height":11}},{"id":"936bc369-1805-40f1-bb17-6489c88de745","block_type":"box","text":"suffer pecuniary losses as a result of default of a licensed intermediary or authorized financial institution in relation","page_number":75,"box":{"x":69,"y":604,"width":826,"height":11}},{"id":"84caf92a-5493-4cd0-92c5-6684f669b09b","block_type":"box","text":"to exchange-traded products in Hong Kong. For defaults occurring on or after January 1, 2020, Hong Kong’s","page_number":75,"box":{"x":68,"y":619,"width":769,"height":11}},{"id":"caf93ec2-1ea1-4fec-827b-5468ac742c64","block_type":"box","text":"Investor Compensation Fund covers investors’ losses in relation to securities (i) that are traded on the SSE or the","page_number":75,"box":{"x":70,"y":634,"width":809,"height":11}},{"id":"2e5469bb-f4ca-4070-acde-03f6dd414545","block_type":"box","text":"SZSE and (ii) in respect of which an order for sale or purchase is permitted to be routed through the Northbound","page_number":75,"box":{"x":69,"y":649,"width":801,"height":12}},{"id":"11ae12e5-bdc8-43b8-b00b-ed7b59920c3d","block_type":"box","text":"Trading Link of a Stock Connect. On the other hand, since a Fund carries out Northbound trading through securities","page_number":75,"box":{"x":68,"y":664,"width":822,"height":12}},{"id":"1bc5bb9a-4e01-4cd9-be2d-4f975b7c3198","block_type":"box","text":"brokers in Hong Kong but not PRC brokers, it is not protected by the China Securities Investor Protection Fund in the","page_number":75,"box":{"x":69,"y":680,"width":829,"height":11}},{"id":"c008caca-efb1-4ec7-aa75-a1203ae4a33f","block_type":"box","text":"PRC.","page_number":75,"box":{"x":69,"y":695,"width":32,"height":9}},{"id":"79429d4b-8e43-4489-8308-b150546a3e86","block_type":"box","text":"Market participants are able to participate in Stock Connects subject to meeting certain information technology","page_number":75,"box":{"x":102,"y":717,"width":796,"height":12}},{"id":"b4c65d13-930d-4ac1-83fd-710a8368eba6","block_type":"box","text":"capability, risk management and other requirements as may be specified by the relevant exchange and/or clearing","page_number":75,"box":{"x":69,"y":732,"width":815,"height":12}},{"id":"280f3385-507f-47b8-b182-915ba4a8f170","block_type":"box","text":"house. Further, the “connectivity” in Stock Connects requires routing of orders across the border of Hong Kong and","page_number":75,"box":{"x":69,"y":748,"width":822,"height":11}},{"id":"beaf62c9-cc48-4ef5-a575-2925afb96c57","block_type":"box","text":"the PRC. This requires the development of new information technology systems on the part of SEHK and exchange","page_number":75,"box":{"x":68,"y":763,"width":818,"height":11}},{"id":"39c7969e-12ac-4db1-88cd-ea3198f8e12e","block_type":"box","text":"participants. There is no assurance that the systems of SEHK and market participants will function properly or will","page_number":75,"box":{"x":70,"y":778,"width":813,"height":11}},{"id":"fb4b2119-988d-4a7d-b799-394b03a029d3","block_type":"box","text":"continue to be adapted to changes and developments in both markets. In the event that the relevant systems fail to","page_number":75,"box":{"x":69,"y":793,"width":827,"height":11}},{"id":"96bbce15-03e9-494d-b065-972a74c9bcc2","block_type":"box","text":"function properly, trading in Stock Connect Securities through Stock Connects could be disrupted.","page_number":75,"box":{"x":68,"y":808,"width":695,"height":11}},{"id":"05668cb8-3421-41fb-bd44-e2f7073b0a6f","block_type":"box","text":"The Shanghai-Hong Kong Stock Connect program launched in November 2014 and the Shenzhen-Hong Kong","page_number":75,"box":{"x":101,"y":831,"width":772,"height":11}},{"id":"df67acdf-5ec5-441b-8e48-1d654ba97688","block_type":"box","text":"Stock Connect program launched in December 2016. Each program does not have an extensive operating history.","page_number":75,"box":{"x":69,"y":846,"width":810,"height":11}},{"id":"1c6f6462-d537-481a-be78-cc6bac3573a7","block_type":"box","text":"New or revised regulations may be issued from time to time by the regulators and stock exchanges in China and","page_number":75,"box":{"x":70,"y":861,"width":798,"height":11}},{"id":"964ff4f7-a819-4f2c-9b6c-5698c2608037","block_type":"box","text":"Hong Kong in connection with operations, legal enforcement and cross-border trades under Stock Connects. In","page_number":75,"box":{"x":70,"y":876,"width":786,"height":11}},{"id":"54e1294b-d3b1-4116-a309-9acd602d9a5f","block_type":"box","text":"addition, there can be no assurance that Stock Connect will not be discontinued. A Fund may be adversely affected","page_number":75,"box":{"x":69,"y":891,"width":821,"height":11}},{"id":"0e984e5a-8268-4783-bf50-698ad112fded","block_type":"box","text":"as a result of such changes. Furthermore, the securities regimes and legal systems of China and Hong Kong differ","page_number":75,"box":{"x":69,"y":906,"width":819,"height":12}},{"id":"d43c2dc4-7c1d-4e6e-af4b-7114747db03d","block_type":"box","text":"II-44","page_number":75,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"f780027d-a959-41d5-9ce4-ec9fea187245","block_type":"box","text":"NM0926U-5977317-75/232","page_number":75,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"cdd19c80-99b0-4a25-abe9-771e7060d428","block_type":"box","text":"significantly and issues may arise from the differences on an on-going basis. In the event that the relevant systems","page_number":76,"box":{"x":69,"y":45,"width":823,"height":11}},{"id":"b792ce57-9145-4a24-a663-fb9e84a7b2a0","block_type":"box","text":"fail to function properly, trading in both markets through Stock Connects could be disrupted and a Fund’s ability to","page_number":76,"box":{"x":68,"y":60,"width":814,"height":11}},{"id":"0f72ab46-607d-41dc-80af-bbdeb8701df4","block_type":"box","text":"achieve its investment objective may be adversely affected. In addition, a Fund’s investments in Stock Connect","page_number":76,"box":{"x":69,"y":75,"width":793,"height":11}},{"id":"8d62517a-3a02-48d1-8435-e8460960b9ae","block_type":"box","text":"Securities through Stock Connects are generally subject to Chinese securities regulations and listing rules, among","page_number":76,"box":{"x":69,"y":90,"width":815,"height":11}},{"id":"38d64057-e1e9-4dcc-a909-e4ecf4435ea6","block_type":"box","text":"other restrictions. Further, different fees, costs and taxes are imposed on foreign investors acquiring Stock Connect","page_number":76,"box":{"x":69,"y":105,"width":828,"height":11}},{"id":"26afe16c-db31-4f20-ac90-9a5be9388660","block_type":"box","text":"Securities through Stock Connects, and these fees, costs and taxes may be higher than comparable fees, costs and","page_number":76,"box":{"x":69,"y":120,"width":831,"height":12}},{"id":"b4cb046c-4070-4255-8eb1-a1f9cf6a9e1d","block_type":"box","text":"taxes imposed on owners of other securities providing similar investment exposure.","page_number":76,"box":{"x":68,"y":135,"width":596,"height":12}},{"id":"9b3db5c6-12cc-4979-a76d-d89f1fcaf160","block_type":"box","text":"Suspension Risk.","page_number":76,"box":{"x":102,"y":158,"width":122,"height":11}},{"id":"b3764a87-14b8-4b84-baf5-979ff54b0f1e","block_type":"box","text":"SSE Securities and SZSE Securities may only be bought from, or sold to, a Fund at times when","page_number":76,"box":{"x":231,"y":158,"width":675,"height":11}},{"id":"a1f15db6-e112-461e-8b82-f992e892f820","block_type":"box","text":"the relevant SSE Securities and SZSE Securities may be sold or purchased on the relevant Chinese stock exchange.","page_number":76,"box":{"x":68,"y":173,"width":829,"height":11}},{"id":"d1d8cbcf-7f43-4445-8f76-0eb3975d7a0e","block_type":"box","text":"The SSE Securities and SZSE Securities markets have a higher propensity for trading suspensions than many other","page_number":76,"box":{"x":68,"y":188,"width":823,"height":12}},{"id":"4a98583e-1e83-4ffe-9b28-6ba7dfad45e6","block_type":"box","text":"global equity markets. Each of the SEHK, SSE and SZSE reserves the right to suspend trading of SSE Securities and","page_number":76,"box":{"x":68,"y":203,"width":831,"height":12}},{"id":"1ba9472f-f8d2-429a-a86c-90252749e251","block_type":"box","text":"SZSE Securities purchased on the Stock Connects if necessary for ensuring an orderly and fair market and ensuring","page_number":76,"box":{"x":69,"y":218,"width":828,"height":12}},{"id":"6d9c408d-f28f-4d07-bca9-8017d9d2cfa4","block_type":"box","text":"that risks are managed prudently. Consent from the relevant regulator would be sought before a suspension of","page_number":76,"box":{"x":68,"y":234,"width":791,"height":11}},{"id":"c7a6946b-c6ca-4d12-9add-4e9bf78a253d","block_type":"box","text":"Northbound trading is triggered. The relevant PRC government authority may also impose “circuit breakers” and other","page_number":76,"box":{"x":70,"y":249,"width":837,"height":11}},{"id":"808d6e71-61b9-430a-821b-29890806ea0c","block_type":"box","text":"measures to halt or suspend Northbound trading. Where a suspension in the Northbound trading through Stock","page_number":76,"box":{"x":69,"y":264,"width":796,"height":11}},{"id":"52970308-409b-43d7-9c45-494295fcc1e0","block_type":"box","text":"Connect is effected, the Fund’s ability to access the PRC market will be adversely affected. Trading suspensions in","page_number":76,"box":{"x":69,"y":279,"width":820,"height":11}},{"id":"3779cbf9-fead-472c-91c8-14a53c34bebb","block_type":"box","text":"certain stocks could lead to greater market execution risk and costs for a Fund. The SSE and SZSE currently apply a","page_number":76,"box":{"x":69,"y":294,"width":829,"height":11}},{"id":"83280220-f0ba-4543-b750-8ac3012168c2","block_type":"box","text":"daily price limit, generally set at 10%, of the amount of fluctuation permitted in the prices of the relevant SSE","page_number":76,"box":{"x":69,"y":309,"width":778,"height":11}},{"id":"399bc118-0703-45bd-914e-3c03e1515960","block_type":"box","text":"Securities and SZSE Securities during a single trading day. The daily price limit refers to price movements only and","page_number":76,"box":{"x":69,"y":324,"width":815,"height":12}},{"id":"22d90780-9ffd-4558-b3bb-3c09fb0271b0","block_type":"box","text":"does not restrict trading within the relevant limit. There can be no assurance that a liquid market on an exchange will","page_number":76,"box":{"x":69,"y":340,"width":833,"height":11}},{"id":"3faf58e7-3ca4-4568-adb2-645b9168bd5c","block_type":"box","text":"exist for any particular SSE Security or SZSE Security or for any particular time.","page_number":76,"box":{"x":69,"y":355,"width":563,"height":11}},{"id":"35f3eda9-153a-445b-b8cb-1a752a3e3056","block_type":"box","text":"Risk of Investing in the China Interbank Bond Market through Bond Connect.","page_number":76,"box":{"x":102,"y":377,"width":542,"height":12}},{"id":"d2753622-567d-4dd5-828f-12491b1794d0","block_type":"box","text":"A Fund may invest directly in the","page_number":76,"box":{"x":650,"y":377,"width":230,"height":11}},{"id":"ebf4054b-90cc-4837-a4a3-094083f29d5a","block_type":"box","text":"domestic bond market in the PRC (the “China Interbank Bond Market”) through the northbound trading of Bond","page_number":76,"box":{"x":69,"y":392,"width":791,"height":12}},{"id":"ecf0747e-e2c2-435b-93c1-345c97a60d37","block_type":"box","text":"Connect (“Bond Connect”). Bond Connect is an initiative launched in July 2017 for mutual bond market access","page_number":76,"box":{"x":69,"y":407,"width":790,"height":12}},{"id":"74e7829c-8d44-4507-b14a-032cbaeac14d","block_type":"box","text":"between the PRC and Hong Kong, established by the China Foreign Exchange Trade System & National Interbank","page_number":76,"box":{"x":69,"y":423,"width":803,"height":11}},{"id":"91834e7a-3563-4bf3-859c-fb91e645f5ea","block_type":"box","text":"Funding Centre (“CFETS”), China Central Depository & Clearing Co., Ltd (“CDCC”), Shanghai Clearing House (“SCH”),","page_number":76,"box":{"x":70,"y":438,"width":832,"height":11}},{"id":"786b0bac-6aa5-4c89-9009-184995926562","block_type":"box","text":"Hong Kong Exchanges and Clearing Limited (“HKEX”) and Central Moneymarkets Unit (“CMU”). Under the prevailing","page_number":76,"box":{"x":70,"y":453,"width":821,"height":11}},{"id":"6ac83d8d-52d6-43e8-a24b-1e928143e6a9","block_type":"box","text":"regulations in the PRC, eligible foreign investors are allowed to invest in the bonds circulated in the China Interbank","page_number":76,"box":{"x":69,"y":468,"width":825,"height":11}},{"id":"993d5ba4-8d39-464e-8ec1-79c15348f644","block_type":"box","text":"Bond Market through Bond Connect. Eligible foreign investors may submit trade requests for bonds circulated in the","page_number":76,"box":{"x":70,"y":483,"width":825,"height":11}},{"id":"3b2e2882-2d97-4596-8db1-c183b7d1162b","block_type":"box","text":"China Interbank Bond Market through offshore electronic bond trading platforms (such as Tradeweb), which will in","page_number":76,"box":{"x":69,"y":498,"width":809,"height":11}},{"id":"756204ac-ee6d-4d0e-b3a5-4565bab701af","block_type":"box","text":"turn transmit their requests for quotation to CFETS. CFETS will send the requests for quotation to a number of","page_number":76,"box":{"x":68,"y":513,"width":786,"height":11}},{"id":"4f27fc60-fbf6-403c-9507-35d80451153a","block_type":"box","text":"approved onshore dealers (including market makers and others engaged in the market making business) in the PRC.","page_number":76,"box":{"x":69,"y":529,"width":830,"height":11}},{"id":"adf4db41-2c1c-41fa-98e1-7bae71225faa","block_type":"box","text":"The approved onshore dealer(s) will respond to the requests for quotation via CFETS and CFETS will send their","page_number":76,"box":{"x":68,"y":543,"width":788,"height":12}},{"id":"be09d19a-253f-4ac1-8e0c-d2e7b503d189","block_type":"box","text":"responses to those eligible foreign investors through the same offshore electronic bond trading platforms. Once the","page_number":76,"box":{"x":69,"y":559,"width":827,"height":11}},{"id":"0250953d-4e8f-4537-9619-86125bdc5756","block_type":"box","text":"eligible foreign investor accepts the quotation, the trade is concluded on CFETS.","page_number":76,"box":{"x":69,"y":574,"width":570,"height":11}},{"id":"04e71c3f-a848-49ac-a6c2-0f2ed97d15d7","block_type":"box","text":"The settlement and custody of bonds traded in the China Interbank Bond Market under Bond Connect will be","page_number":76,"box":{"x":101,"y":596,"width":773,"height":12}},{"id":"c6da4821-486c-4c18-87dc-4f3cd17c80c1","block_type":"box","text":"effected through the settlement and custody link between CMU, as an offshore custody agent, and CDCC and SCH,","page_number":76,"box":{"x":69,"y":612,"width":823,"height":11}},{"id":"df02c67c-cfdb-4714-8537-491b3d14f823","block_type":"box","text":"as onshore custodians and clearing institutions in the PRC. Under the settlement link, CDCC or SCH will effect gross","page_number":76,"box":{"x":69,"y":627,"width":832,"height":11}},{"id":"f60fa838-0be9-4312-bf80-ed18ab872cb0","block_type":"box","text":"settlement of confirmed trades onshore and CMU will process bond settlement instructions from CMU members on","page_number":76,"box":{"x":69,"y":642,"width":822,"height":11}},{"id":"154dc850-66ca-42d2-96ef-10b0b540713c","block_type":"box","text":"behalf of eligible foreign investors in accordance with its relevant rules. Since the introduction in August 2018 of","page_number":76,"box":{"x":69,"y":657,"width":804,"height":11}},{"id":"f84bfbfc-74d0-4d10-8452-78c7de2d8299","block_type":"box","text":"delivery versus payment (DVP) settlement in respect of Bond Connect, the movement of cash and securities is","page_number":76,"box":{"x":69,"y":672,"width":787,"height":11}},{"id":"6fa3ab25-8622-4d68-aa77-a958d5fa4cff","block_type":"box","text":"carried out simultaneously on a real-time basis. Pursuant to the prevailing regulations in the PRC, CMU, as the","page_number":76,"box":{"x":69,"y":687,"width":788,"height":11}},{"id":"c380c9e4-91bc-492b-919b-3e32331b9a13","block_type":"box","text":"offshore custody agent recognized by the Hong Kong Monetary Authority, will open omnibus nominee accounts with","page_number":76,"box":{"x":69,"y":702,"width":820,"height":12}},{"id":"38daf390-eb6e-4045-a2f2-c08a2c357d99","block_type":"box","text":"the onshore custody agent recognized by the People’s Bank of China (","page_number":76,"box":{"x":68,"y":717,"width":500,"height":12}},{"id":"07b16ac4-1d48-41a8-b3b6-10ae10af37bf","block_type":"box","text":"i.e.","page_number":76,"box":{"x":570,"y":718,"width":20,"height":8}},{"id":"11e14a43-c49b-4882-8078-8de97e5d6bf9","block_type":"box","text":", CDCC and SCH). All bonds traded by","page_number":76,"box":{"x":593,"y":718,"width":267,"height":11}},{"id":"6413dc49-724f-4f40-a573-e8d12797740d","block_type":"box","text":"eligible foreign investors through Bond Connect will be registered in the name of CMU, which will hold such bonds as","page_number":76,"box":{"x":69,"y":732,"width":832,"height":12}},{"id":"90075a5b-8ba2-4d67-b427-2b9dc35cca02","block_type":"box","text":"a nominee owner. Therefore, a Fund will be exposed to custody risks with respect to CMU. In the remote event of a","page_number":76,"box":{"x":69,"y":748,"width":819,"height":11}},{"id":"58fd18b4-35b2-4488-b224-88a8245eabfb","block_type":"box","text":"CDCC or SCH default, CMU’s liabilities in Bond Connect bonds under its market contracts with clearing participants","page_number":76,"box":{"x":69,"y":763,"width":822,"height":11}},{"id":"e54d14c0-31ae-4d1b-be5b-4ea100723e8a","block_type":"box","text":"will be limited to assisting clearing participants in pursuing their claims against CDCC or SCH. The Fund may suffer","page_number":76,"box":{"x":68,"y":778,"width":822,"height":11}},{"id":"faf2bf23-7d49-4d15-b662-9daa302bb70c","block_type":"box","text":"delay in the recovery process or may not fully recover its losses from CDCC or SCH. In addition, as the relevant","page_number":76,"box":{"x":69,"y":793,"width":793,"height":11}},{"id":"b531ee68-2190-458b-be6f-62a8e9a4b86d","block_type":"box","text":"filings, registration with the People’s Bank of China, and account opening have to be carried out by third parties,","page_number":76,"box":{"x":68,"y":808,"width":802,"height":11}},{"id":"f9a849b6-2fbe-4779-a72a-b3c2e0c7831e","block_type":"box","text":"including CMU, CDCC, SCH, and CFETS, a Fund is subject to the risks of default or errors on the part of such third","page_number":76,"box":{"x":70,"y":823,"width":812,"height":12}},{"id":"e8fecbca-465f-4268-a775-2849c104475d","block_type":"box","text":"parties.","page_number":76,"box":{"x":70,"y":839,"width":52,"height":10}},{"id":"becaa2cb-a5b5-4bc6-bc50-484bb49bb1ea","block_type":"box","text":"The precise nature and rights of a Fund as the beneficial owner of the bonds traded in the China Interbank Bond","page_number":76,"box":{"x":101,"y":861,"width":799,"height":11}},{"id":"11ed9a51-2699-46c8-b89d-5f4434501d2c","block_type":"box","text":"Market through CMU as nominee is not well-defined under PRC law. There is a lack of a clear definition of, and","page_number":76,"box":{"x":70,"y":876,"width":785,"height":11}},{"id":"68024658-a7de-4fc0-9f63-aac59a1665e1","block_type":"box","text":"distinction between, legal ownership and beneficial ownership under PRC law and there have been few cases","page_number":76,"box":{"x":69,"y":891,"width":776,"height":12}},{"id":"dd989365-2568-4b82-b5df-19470061d3f4","block_type":"box","text":"II-45","page_number":76,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"d68dcc48-46d3-4942-9496-fc1d820210e6","block_type":"box","text":"NM0926U-5977317-76/232","page_number":76,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"2fc95200-a91e-4b3a-8ea3-d641f15608a4","block_type":"box","text":"involving a nominee account structure in the PRC courts. The exact nature and methods of enforcement of the rights","page_number":77,"box":{"x":70,"y":45,"width":830,"height":11}},{"id":"b646cfa9-0f02-4d9a-987b-c6cefcc407c3","block_type":"box","text":"and interests of a Fund under PRC law are also uncertain.","page_number":77,"box":{"x":69,"y":60,"width":412,"height":9}},{"id":"144fe0ec-fb58-4164-9603-05abe1ea85a6","block_type":"box","text":"Market volatility and potential lack of liquidity due to low trading volume of certain bonds in the China Interbank","page_number":77,"box":{"x":102,"y":82,"width":793,"height":12}},{"id":"1f5926a7-92ed-4ad5-8830-85475f3d5d75","block_type":"box","text":"Bond Market may result in prices of certain bonds traded on such market fluctuating significantly. A Fund investing in","page_number":77,"box":{"x":70,"y":98,"width":832,"height":11}},{"id":"611e897d-da21-44ea-8b24-3962312c2d77","block_type":"box","text":"such market is therefore subject to liquidity and volatility risks. The bid-ask spreads of the prices of such securities","page_number":77,"box":{"x":69,"y":113,"width":821,"height":11}},{"id":"ae894fd8-01d0-4aeb-8cee-6c205c2e3267","block_type":"box","text":"may be large, and a Fund may therefore incur significant costs and may suffer losses when selling such investments.","page_number":77,"box":{"x":69,"y":128,"width":836,"height":11}},{"id":"a71ab283-8c42-428f-9c2e-64deb6f79689","block_type":"box","text":"The bonds traded in the China Interbank Bond Market may be difficult or impossible to sell, which may impact a","page_number":77,"box":{"x":68,"y":143,"width":798,"height":11}},{"id":"f088e3e7-d468-46a7-be68-9fc047bc0605","block_type":"box","text":"Fund’s ability to acquire or dispose of such securities at their expected prices.","page_number":77,"box":{"x":70,"y":158,"width":556,"height":11}},{"id":"9c2db5ac-22c0-4cec-ae73-5f73efc5024d","block_type":"box","text":"Investing in the China Interbank Bond Market through Bond Connect is also subject to regulatory risks. The","page_number":77,"box":{"x":102,"y":181,"width":762,"height":11}},{"id":"5ac9db14-433d-446d-9c3e-b0a70571689a","block_type":"box","text":"relevant rules and regulations are subject to change, which may have potential retrospective effect, and there can be","page_number":77,"box":{"x":69,"y":196,"width":835,"height":11}},{"id":"9cefd4ec-0cc4-45a0-a768-42e28ceea8bb","block_type":"box","text":"no assurance that Bond Connect will not be discontinued or abolished. Furthermore, the securities regimes and legal","page_number":77,"box":{"x":69,"y":211,"width":835,"height":11}},{"id":"8f42078f-9e45-4df7-9f88-d2f24fc4e908","block_type":"box","text":"systems of China and Hong Kong differ significantly and issues may arise based on these differences. In the event","page_number":77,"box":{"x":69,"y":226,"width":820,"height":11}},{"id":"6358edab-1522-4a3d-b690-147584eae03f","block_type":"box","text":"that the relevant authorities suspend account opening or trading on the China Interbank Bond Market, a Fund’s ability","page_number":77,"box":{"x":68,"y":241,"width":840,"height":11}},{"id":"b5180d1d-a813-49d7-827e-e782200ea922","block_type":"box","text":"to invest in the China Interbank Bond Market will be adversely affected and limited. In such event, the Fund’s ability","page_number":77,"box":{"x":68,"y":256,"width":826,"height":11}},{"id":"d5fa4ef5-c934-46d2-ab61-4a39a8622a5e","block_type":"box","text":"to achieve its investment objective will be negatively affected and, after exhausting other trading alternatives, the","page_number":77,"box":{"x":68,"y":271,"width":808,"height":12}},{"id":"6be104d2-a112-4819-bfdb-efac1c5cfd5b","block_type":"box","text":"Fund may suffer substantial losses as a result. Further, if Bond Connect is not operating, a Fund may not be able to","page_number":77,"box":{"x":70,"y":286,"width":826,"height":12}},{"id":"7ccc00f3-5353-409b-a28b-af74086c6d42","block_type":"box","text":"acquire or dispose of bonds through Bond Connect in a timely manner, which could adversely affect the Fund’s","page_number":77,"box":{"x":69,"y":302,"width":789,"height":11}},{"id":"87dbe9be-973b-4a24-9e10-3cfb241f538a","block_type":"box","text":"performance.","page_number":77,"box":{"x":70,"y":317,"width":93,"height":11}},{"id":"8f99b2c7-50e2-4109-b97f-59930168efed","block_type":"box","text":"Trading through Bond Connect is performed through newly developed trading platforms and operational systems.","page_number":77,"box":{"x":101,"y":339,"width":803,"height":12}},{"id":"977dfa39-db06-4f43-8d79-e3db7ff83b5a","block_type":"box","text":"There is no assurance that such systems will function properly or will continue to be adapted to changes and","page_number":77,"box":{"x":68,"y":355,"width":776,"height":11}},{"id":"b12e9ff8-22dd-454d-be6e-6b29e20edde4","block_type":"box","text":"developments in the market. In the event that the relevant systems fail to function properly, trading through Bond","page_number":77,"box":{"x":69,"y":370,"width":806,"height":11}},{"id":"727d2336-f3c7-4aa9-80b3-b7a55ed5a39c","block_type":"box","text":"Connect may be disrupted. A Fund’s ability to trade through Bond Connect (and hence to pursue its investment","page_number":77,"box":{"x":69,"y":385,"width":791,"height":11}},{"id":"0e443bd6-0542-4c2f-bea1-5bbd80cb7a7d","block_type":"box","text":"strategy) may therefore be adversely affected. In addition, where a Fund invests in the China Interbank Bond Market","page_number":77,"box":{"x":69,"y":400,"width":827,"height":11}},{"id":"44498b2b-c560-4f69-a1fa-a4610358219b","block_type":"box","text":"through Bond Connect, it may be subject to risks of delays inherent in the order placing and/or settlement systems.","page_number":77,"box":{"x":68,"y":415,"width":827,"height":11}},{"id":"cca5990e-b961-4037-be44-c8fa80e79913","block_type":"box","text":"Bond Connect trades are settled in Chinese currency, the RMB, which is currently restricted and not freely","page_number":77,"box":{"x":102,"y":438,"width":755,"height":11}},{"id":"b2cc11c5-311b-4fa4-a581-d1f696076a7f","block_type":"box","text":"convertible. As a result, a Fund will be exposed to currency risk, and it cannot be guaranteed that investors will have","page_number":77,"box":{"x":69,"y":453,"width":830,"height":11}},{"id":"b0249ace-cce7-44ea-b2d5-c6c64d141246","block_type":"box","text":"timely access to a reliable supply of RMB.","page_number":77,"box":{"x":68,"y":468,"width":298,"height":11}},{"id":"c4550f69-dd45-42bb-9fbc-b16ba8a8c71d","block_type":"box","text":"Tax Risk – Withholding Income Tax Risk","page_number":77,"box":{"x":103,"y":491,"width":277,"height":11}},{"id":"ca5dc42c-b768-4ab9-bf0b-8207d82fba43","block_type":"box","text":".","page_number":77,"box":{"x":381,"y":498,"width":2,"height":2}},{"id":"89175227-ef7e-4210-a2e1-6c6928d56176","block_type":"box","text":"According to PRC tax regulations, a 10% withholding income tax is imposed on PRC sourced dividends and","page_number":77,"box":{"x":101,"y":513,"width":758,"height":12}},{"id":"1d02d874-d1dd-45cb-86b0-2a8cad967df0","block_type":"box","text":"interests from non-government bonds paid to a non-PRC tax resident enterprise, unless the rate is reduced under an","page_number":77,"box":{"x":70,"y":528,"width":828,"height":12}},{"id":"d9a56551-277c-4f64-b20f-52d7cf7e7600","block_type":"box","text":"applicable tax treaty. From a technical perspective, withholding income tax is also applicable to capital gains realized","page_number":77,"box":{"x":69,"y":544,"width":831,"height":11}},{"id":"2b8c2eae-32f0-4ee6-adbc-a1f56836bee4","block_type":"box","text":"by foreign investors on the disposal of PRC equity interests.","page_number":77,"box":{"x":69,"y":559,"width":425,"height":11}},{"id":"c0e3b524-46ef-4908-b8f0-a85fc9b461f5","block_type":"box","text":"There are however certain tax exemptions available, some temporary in nature, highlighted below.","page_number":77,"box":{"x":101,"y":582,"width":697,"height":11}},{"id":"58ae20ed-c873-4e50-95dd-be00f716a184","block_type":"box","text":"On November 14, 2014, the Ministry of Finance (“MoF”), China Securities Regulatory Commission and the State","page_number":77,"box":{"x":102,"y":604,"width":803,"height":11}},{"id":"e823c7e6-d8de-4444-8150-a6ff7eb4cdaa","block_type":"box","text":"Taxation Administration (“STA”), acting with State Council’s approval, jointly released Circular 79, which temporarily","page_number":77,"box":{"x":68,"y":619,"width":822,"height":11}},{"id":"e1d109cd-37b0-4877-8b09-cb29e2da2e32","block_type":"box","text":"exempts Qualified Foreign Institutional Investors (“QFIIs”) and Renminbi Qualified Foreign Institutional Investors","page_number":77,"box":{"x":69,"y":634,"width":794,"height":12}},{"id":"1f31ea64-7920-4271-87e7-0f3b3d76569c","block_type":"box","text":"(“RQFIIs”) from tax on capital gains derived from the trading of shares and other equity interest investments on or","page_number":77,"box":{"x":69,"y":649,"width":812,"height":12}},{"id":"4e35857a-4cb1-4424-b019-519a6db8de22","block_type":"box","text":"after November 17, 2014. Subsequently, Circulars 81 and 127 were issued to temporarily exempt tax on capital","page_number":77,"box":{"x":69,"y":664,"width":800,"height":12}},{"id":"00c4a386-7abd-44ff-b5fc-15368335f69d","block_type":"box","text":"gains derived from trading of equity securities of companies domiciled in the PRC that trade on Chinese stock","page_number":77,"box":{"x":68,"y":680,"width":783,"height":11}},{"id":"b69658f0-9c58-4986-bd50-bb0354d47c8d","block_type":"box","text":"exchanges (“A-Shares”) through the Shanghai-Hong Kong Stock Connect program or the Shenzhen-Hong Kong Stock","page_number":77,"box":{"x":69,"y":695,"width":825,"height":11}},{"id":"b363d41d-3a1e-423e-b74c-38db38503c82","block_type":"box","text":"Connect program, as applicable (each, a “Stock Connect” and collectively, “Stock Connects”). The duration of the","page_number":77,"box":{"x":69,"y":710,"width":809,"height":11}},{"id":"6f389610-cff7-4b06-9517-3b7fe1e215b2","block_type":"box","text":"temporary exemptions is not stated in the circulars and is subject to termination by the PRC tax authorities with or","page_number":77,"box":{"x":68,"y":725,"width":818,"height":11}},{"id":"ffdaa0f7-50c5-45db-9e4b-16769162816c","block_type":"box","text":"without notice.","page_number":77,"box":{"x":68,"y":740,"width":103,"height":9}},{"id":"3ca0bf23-2d08-4540-b072-46e35a8fe0b6","block_type":"box","text":"On November 22, 2018, the MoF and STA jointly issued Circular 108 which states that foreign institutional","page_number":77,"box":{"x":102,"y":763,"width":759,"height":11}},{"id":"11130ce0-dd0e-49d7-8322-a482f69315d0","block_type":"box","text":"investors are temporarily exempt from withholding income tax with respect to interest income on bonds derived from","page_number":77,"box":{"x":70,"y":778,"width":827,"height":11}},{"id":"d137f918-9297-4ffc-b596-ce47782c9803","block_type":"box","text":"the PRC bond market from November 7, 2018 to November 6, 2021. On November 22, 2021, the MoF and STA","page_number":77,"box":{"x":68,"y":793,"width":798,"height":10}},{"id":"60585aa8-ad46-4887-97c2-1720d634a03d","block_type":"box","text":"issued Public Notice 34 to extend the temporary exemption from November 7, 2021 to December 31, 2025. On","page_number":77,"box":{"x":70,"y":808,"width":798,"height":11}},{"id":"64401d3c-e5ea-4825-bbcf-e05731add219","block_type":"box","text":"January 15, 2026, it was announced via Public Notice No. 5 of 2026 that the exemption was extended through","page_number":77,"box":{"x":69,"y":823,"width":792,"height":12}},{"id":"f7950222-7909-46dc-bc9e-ffa5dd37677e","block_type":"box","text":"December 31, 2027.","page_number":77,"box":{"x":70,"y":838,"width":147,"height":11}},{"id":"60f9cca8-5ca7-462a-9e67-2d42e8841f22","block_type":"box","text":"Value Added Tax (“VAT”) Risk —","page_number":77,"box":{"x":103,"y":861,"width":225,"height":11}},{"id":"d4302590-e545-4ea3-a5d8-aa8e7940ec96","block_type":"box","text":"From May 1, 2016, VAT applies to certain income derived by the Fund, including","page_number":77,"box":{"x":333,"y":861,"width":569,"height":11}},{"id":"941ecba3-d529-4b6d-b15e-a2773e274120","block_type":"box","text":"PRC sourced interest income on non-government bonds and trading gains.","page_number":77,"box":{"x":69,"y":876,"width":528,"height":11}},{"id":"202a9483-0f4c-4d60-96fe-b89d5191fecb","block_type":"box","text":"There are however certain tax exemptions available, some temporary in nature, highlighted below.","page_number":77,"box":{"x":101,"y":899,"width":697,"height":11}},{"id":"6f98ac60-7888-443b-8f2f-9e80ba6cf4cb","block_type":"box","text":"II-46","page_number":77,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"4b7ca652-d089-45c0-af99-0fb3cdc7c6f8","block_type":"box","text":"NM0926U-5977317-77/232","page_number":77,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"239238bd-94aa-41f4-a606-d60086eebb83","block_type":"box","text":"VAT exemptions currently apply to capital gains from trading of QFII and RQFII products, A-Shares traded on the","page_number":78,"box":{"x":101,"y":45,"width":789,"height":11}},{"id":"be1d74f2-5a23-4a59-a0d5-c40d65857ac9","block_type":"box","text":"Stock Connects and debt securities traded in the China Interbank Bond Market.","page_number":78,"box":{"x":69,"y":60,"width":565,"height":9}},{"id":"7b5faa01-bc7b-4607-b147-97a34e74fe08","block_type":"box","text":"On November 7, 2018, the MoF and STA jointly issued Circular 108 which states that foreign institutional","page_number":78,"box":{"x":102,"y":82,"width":749,"height":12}},{"id":"2aa4b7de-2e94-429e-9093-0b6d7157f715","block_type":"box","text":"investors are temporarily exempt from VAT with respect to interest income on bonds derived from the PRC bond","page_number":78,"box":{"x":70,"y":98,"width":791,"height":11}},{"id":"5aa42680-5291-4dd6-8df9-2e9eb0f6612d","block_type":"box","text":"market from November 7, 2018 to November 6, 2021. On November 22, 2021, the MoF and STA jointly issued Public","page_number":78,"box":{"x":69,"y":113,"width":840,"height":11}},{"id":"f141e9f2-8039-48c2-b959-f0d7bf3ac202","block_type":"box","text":"Notice 34 to extend the temporary exemption from November 7, 2021 to December 31, 2025. However, on","page_number":78,"box":{"x":70,"y":128,"width":766,"height":11}},{"id":"b6868b3c-737b-46b8-997d-cf655955e275","block_type":"box","text":"July 31, 2025, the MoF and STA jointly issued Public Notice No 4 of 2025, stating that VAT will apply with respect to","page_number":78,"box":{"x":69,"y":143,"width":826,"height":11}},{"id":"f41c3571-5b10-4289-b2f4-205ac0d524e3","block_type":"box","text":"interest income derived from treasury bonds, local government bonds and financial bonds issued on or after","page_number":78,"box":{"x":70,"y":158,"width":772,"height":11}},{"id":"6c52dc28-11eb-4201-b0c4-55186e62892d","block_type":"box","text":"August 8, 2025. It is understood that Public Notice No 4 of 2025 does not supersede the afore-mentioned exemption","page_number":78,"box":{"x":68,"y":173,"width":840,"height":11}},{"id":"4ea57ec8-a37e-45ca-9af9-72e7fd01ee48","block_type":"box","text":"for foreign institutional investors. This exemption was extended through December 31, 2027.","page_number":78,"box":{"x":68,"y":188,"width":665,"height":12}},{"id":"d1e24b32-064e-4073-ba9d-db1ccb705ff6","block_type":"box","text":"Any changes in PRC tax law, future clarifications thereof, and/or subsequent retroactive enforcement by the PRC","page_number":78,"box":{"x":101,"y":211,"width":801,"height":11}},{"id":"8c94ea54-cb56-41b6-bc5e-b36064101dd7","block_type":"box","text":"tax authorities may result in a loss which could be material to the Fund. There is a risk the PRC tax authorities may","page_number":78,"box":{"x":68,"y":226,"width":821,"height":11}},{"id":"ad76fc99-7985-4c96-a943-9ca36cfaf7f8","block_type":"box","text":"withdraw the temporary tax exemptions in the future and seek to collect taxes realized on the sale of A-Shares or","page_number":78,"box":{"x":68,"y":241,"width":808,"height":11}},{"id":"b5e5d64f-977d-43d5-8a52-755ccde4db7b","block_type":"box","text":"PRC sourced interest income on non-government bonds received by the Fund without giving any prior notice. If the","page_number":78,"box":{"x":69,"y":256,"width":810,"height":12}},{"id":"f608b159-55f3-4e0f-9c5d-4fa6093826b2","block_type":"box","text":"temporary tax exemptions are withdrawn, any taxes may be directly borne by or indirectly passed on to the Fund and","page_number":78,"box":{"x":68,"y":272,"width":829,"height":11}},{"id":"ca4fc262-ec73-4435-b89c-274aeb7db5b8","block_type":"box","text":"may result in a substantial impact to its net asset value. As with any net asset value adjustment, investors may be","page_number":78,"box":{"x":69,"y":287,"width":819,"height":11}},{"id":"ff2f9582-61b7-4246-8344-89397aa083c2","block_type":"box","text":"advantaged or disadvantaged depending on when the investors purchased and/or sold the shares of the Fund. There","page_number":78,"box":{"x":69,"y":302,"width":833,"height":11}},{"id":"09c33f26-e161-40d2-8a35-eec8dabc4016","block_type":"box","text":"will be no retrospective restatement of the Fund’s net asset value.","page_number":78,"box":{"x":68,"y":317,"width":474,"height":11}},{"id":"53354154-1bf4-44d6-9da1-717a7b691d73","block_type":"box","text":"BlackRock will keep the provisioning policy for tax liability under review and may, in its discretion from time to","page_number":78,"box":{"x":102,"y":339,"width":777,"height":12}},{"id":"59cac2bc-0bd9-45d8-9f27-1d3459146a76","block_type":"box","text":"time, make a provision for potential tax liabilities if in its opinion such provision is warranted or as further clarified by","page_number":78,"box":{"x":68,"y":355,"width":836,"height":11}},{"id":"c3bde8a3-8182-446a-aebe-434eb8ecf4ad","block_type":"box","text":"the PRC in notifications.","page_number":78,"box":{"x":68,"y":370,"width":171,"height":9}},{"id":"711251ab-02e3-481a-a8c1-1144dd577854","block_type":"box","text":"Investment in Other Investment Companies.","page_number":78,"box":{"x":102,"y":392,"width":320,"height":11}},{"id":"be6a0407-d7ab-4823-bcd0-b00ebf05a493","block_type":"box","text":"Each Fund may, subject to applicable law, invest in other","page_number":78,"box":{"x":429,"y":393,"width":402,"height":11}},{"id":"d2ede62a-be20-426f-a4b3-1f63d32e50e0","block_type":"box","text":"investment companies (including investment companies managed by BlackRock and its affiliates), including money","page_number":78,"box":{"x":70,"y":407,"width":818,"height":12}},{"id":"0486c9de-f23a-4f24-a789-e65021c53a4d","block_type":"box","text":"market funds and ETFs, which are typically open-end funds or unit investment trusts listed on a stock exchange.","page_number":78,"box":{"x":69,"y":423,"width":797,"height":11}},{"id":"0b0ebfea-5b1c-486a-a87a-78a92d8fd953","block_type":"box","text":"Under Section 12(d)(1)(A) of the Investment Company Act, however, a Fund may invest up to 10% of its total assets","page_number":78,"box":{"x":70,"y":438,"width":822,"height":11}},{"id":"17f77e79-22a9-4ad1-8e02-ec6d939e3bcd","block_type":"box","text":"in securities of other investment companies (measured at the time of such investment). In addition, under Section","page_number":78,"box":{"x":70,"y":453,"width":814,"height":11}},{"id":"82d6cd27-d525-4832-88e2-e3b22af91651","block_type":"box","text":"12(d)(1)(A) of the Investment Company Act a Fund may not acquire securities of an investment company if such","page_number":78,"box":{"x":70,"y":468,"width":793,"height":11}},{"id":"57c79eb2-e387-4791-be58-14130a448c66","block_type":"box","text":"acquisition would cause the Fund to own more than 3% of the total outstanding voting stock of such investment","page_number":78,"box":{"x":69,"y":483,"width":796,"height":11}},{"id":"23878cb5-ccb2-4302-9dfd-b7b360744077","block_type":"box","text":"company and a Fund may not invest in another investment company if such investment would cause more than 5% of","page_number":78,"box":{"x":69,"y":498,"width":837,"height":11}},{"id":"b302bf15-a0ea-4e79-99a7-1e99ac97b95f","block_type":"box","text":"the value of the Fund’s total assets to be invested in securities of such investment company. (These limits do not","page_number":78,"box":{"x":68,"y":513,"width":812,"height":11}},{"id":"ce1b1722-381b-4764-8dcb-63af1a4e0975","block_type":"box","text":"restrict a Feeder Fund from investing all of its assets in shares of its Master Portfolio.) In addition to the restrictions","page_number":78,"box":{"x":69,"y":528,"width":829,"height":12}},{"id":"81fb862a-5bc0-42b1-862a-b34138286e2c","block_type":"box","text":"on investing in other investment companies discussed above, under Section 12(d)(1)(C) of the Investment Company","page_number":78,"box":{"x":69,"y":543,"width":827,"height":12}},{"id":"2f8fc319-ffed-4b57-82f0-f791dc4e4d63","block_type":"box","text":"Act a Fund may not invest in a registered closed-end investment company if such investment would cause the Fund","page_number":78,"box":{"x":68,"y":559,"width":821,"height":11}},{"id":"7c365720-58f6-4aae-b797-60baf07e8253","block_type":"box","text":"and other BlackRock-advised investment companies to own more than 10% of the total outstanding voting stock of","page_number":78,"box":{"x":69,"y":574,"width":817,"height":11}},{"id":"ff79ba18-d2aa-453d-abac-a8e0d3900baa","block_type":"box","text":"such closed-end investment company. Pursuant to Section 12(d)(1)(G) of the Investment Company Act, these","page_number":78,"box":{"x":69,"y":589,"width":776,"height":11}},{"id":"0160ebc0-6390-4391-b714-e25f8678a585","block_type":"box","text":"percentage limitations do not apply to investments in affiliated investment companies, including ETFs, subject to","page_number":78,"box":{"x":70,"y":604,"width":802,"height":11}},{"id":"76d7a8cd-ef8f-472b-8b90-02b4db610627","block_type":"box","text":"certain conditions. In addition, a Fund may be able to rely on certain rules under the Investment Company Act to","page_number":78,"box":{"x":69,"y":619,"width":801,"height":11}},{"id":"db66aba3-6dd3-4c88-bfe8-d4ebbabcf597","block_type":"box","text":"invest in shares of money market funds or other investment companies beyond the statutory limits noted above, but","page_number":78,"box":{"x":70,"y":634,"width":829,"height":11}},{"id":"690cc06a-29b3-4a9d-9bf1-eb24e33cc925","block_type":"box","text":"subject to certain conditions.","page_number":78,"box":{"x":69,"y":650,"width":206,"height":10}},{"id":"edd34976-c1a5-49da-b318-d068dd35c9d6","block_type":"box","text":"As with other investments, investments in other investment companies are subject to market and selection risk.","page_number":78,"box":{"x":101,"y":672,"width":799,"height":11}},{"id":"299e751d-7633-46f7-a7b9-9020604ae6f7","block_type":"box","text":"Shares of investment companies, such as closed-end fund investment companies, that trade on an exchange","page_number":78,"box":{"x":102,"y":695,"width":779,"height":11}},{"id":"58e56e71-4e1e-4b6b-836d-528f0ff76b01","block_type":"box","text":"may at times be acquired at market prices representing premiums to their NAVs. In addition, investment companies","page_number":78,"box":{"x":69,"y":710,"width":824,"height":11}},{"id":"02a02242-bea2-4b4e-a306-ae410ff3de27","block_type":"box","text":"held by a Fund that trade on an exchange could trade at a discount from NAV, and such discount could increase while","page_number":78,"box":{"x":69,"y":725,"width":836,"height":11}},{"id":"9bff0d10-65a1-438a-b84e-f69e5f8b7f22","block_type":"box","text":"the Fund holds the shares. If the market price of shares of an exchange-traded investment company decreases below","page_number":78,"box":{"x":68,"y":740,"width":839,"height":11}},{"id":"63f82ac8-8c8b-4df9-9a54-fa88492e1d1f","block_type":"box","text":"the price that the Fund paid for the shares and the Fund were to sell its shares of such investment company at a","page_number":78,"box":{"x":68,"y":755,"width":806,"height":11}},{"id":"9e8ab8e8-7a92-4309-9e6a-7243a555be0e","block_type":"box","text":"time when the market price is lower than the price at which it purchased the shares, the Fund would experience a","page_number":78,"box":{"x":68,"y":771,"width":810,"height":10}},{"id":"705f1a54-e95a-4b66-913f-0d3b980baaa9","block_type":"box","text":"loss.","page_number":78,"box":{"x":70,"y":786,"width":31,"height":8}},{"id":"da98bd2f-6208-4684-a1ec-9b74e3c5b0d2","block_type":"box","text":"In addition, if a Fund acquires shares in investment companies, including affiliated investment companies,","page_number":78,"box":{"x":102,"y":808,"width":758,"height":11}},{"id":"217142b7-9611-45eb-85f8-430ecc0012b2","block_type":"box","text":"shareholders would bear both their proportionate share of expenses in the Fund and, indirectly, the expenses of such","page_number":78,"box":{"x":69,"y":823,"width":837,"height":11}},{"id":"a53e6f55-b5d8-45bd-b562-1d7653d4ed2d","block_type":"box","text":"investment companies. Such expenses, both at the Fund level and acquired investment company level, would include","page_number":78,"box":{"x":70,"y":838,"width":835,"height":11}},{"id":"dcb41739-6a02-4a07-9a26-38c0c24760d2","block_type":"box","text":"management and advisory fees, unless such fees have been waived by BlackRock. Please see the relevant Fund’s","page_number":78,"box":{"x":69,"y":853,"width":816,"height":12}},{"id":"f7aab90b-a0c2-4d1a-bae7-344d92a91871","block_type":"box","text":"Prospectus to determine whether any such management and advisory fees have been waived by BlackRock.","page_number":78,"box":{"x":69,"y":869,"width":768,"height":11}},{"id":"03b38bc4-699f-4779-a072-01d6a7cf1b4c","block_type":"box","text":"Investments by a Fund in wholly owned investment entities created under the laws of certain countries will not be","page_number":78,"box":{"x":70,"y":884,"width":807,"height":11}},{"id":"3f7f56c8-2dc9-4efd-84d8-e92915bb69cc","block_type":"box","text":"deemed an investment in other investment companies. Pursuant to guidance issued by the staff of the Commission,","page_number":78,"box":{"x":69,"y":899,"width":830,"height":11}},{"id":"21340831-83e4-4042-97ed-f5aec3f7bfd6","block_type":"box","text":"II-47","page_number":78,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"d4714ad4-dc0f-4eb1-a8af-d4d266e3a2d8","block_type":"box","text":"NM0926U-5977317-78/232","page_number":78,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"bffc8544-b097-4b2f-a48c-3716103ec868","block_type":"box","text":"fees and expenses of money market funds used for the investment of cash collateral received in connection with","page_number":79,"box":{"x":68,"y":45,"width":804,"height":11}},{"id":"f32e78fc-9859-49f8-99f1-45c92821f1ae","block_type":"box","text":"loans of Fund securities are not treated as “acquired fund fees and expenses,” which are fees and expenses","page_number":79,"box":{"x":70,"y":60,"width":778,"height":11}},{"id":"861a0841-78a9-40ae-9a67-e69d4825193e","block_type":"box","text":"charged by other investment companies and pooled investment vehicles in which a Fund invests a portion of its","page_number":79,"box":{"x":69,"y":75,"width":796,"height":11}},{"id":"c8b842b9-f771-4cf8-8bb3-8ec8eceb18f5","block_type":"box","text":"assets.","page_number":79,"box":{"x":69,"y":91,"width":51,"height":8}},{"id":"90592acf-6ab1-4d56-9bf4-c49a19e56b50","block_type":"box","text":"To the extent shares of a Fund are held by another fund, the ability of the Fund itself to purchase other funds","page_number":79,"box":{"x":101,"y":113,"width":776,"height":11}},{"id":"ff329fb0-5530-4ad4-b373-8978fbe145f5","block_type":"box","text":"may be limited. In addition, a fund-of-funds (","page_number":79,"box":{"x":69,"y":128,"width":313,"height":11}},{"id":"5b879e53-deaf-4aa9-8a31-24803410dc86","block_type":"box","text":"e.g.","page_number":79,"box":{"x":384,"y":129,"width":24,"height":10}},{"id":"7f26c63a-3eb6-4d70-a62f-5ee22901eade","block_type":"box","text":", an investment company that seeks to meet its investment objective","page_number":79,"box":{"x":411,"y":128,"width":491,"height":11}},{"id":"8cfb6cf1-96f7-49b7-b95d-0b84b1d64f28","block_type":"box","text":"by investing significantly in other investment companies) may be limited in its ability to purchase underlying funds if","page_number":79,"box":{"x":69,"y":143,"width":823,"height":11}},{"id":"8401ddd7-b6e5-4938-b6b1-e8cbb2a73f46","block_type":"box","text":"such underlying funds themselves own shares of underlying funds.","page_number":79,"box":{"x":69,"y":158,"width":472,"height":11}},{"id":"c84b50aa-d530-4e2b-9a35-9e2328a18693","block_type":"box","text":"A number of publicly traded closed-end investment companies have been organized to facilitate indirect foreign","page_number":79,"box":{"x":101,"y":181,"width":790,"height":11}},{"id":"ccab4c71-1fb0-4d60-b5b2-1161d617f4e7","block_type":"box","text":"investment in developing countries, and certain of such countries, such as Thailand, South Korea, Chile and Brazil,","page_number":79,"box":{"x":70,"y":196,"width":818,"height":11}},{"id":"f69dd3d4-18c0-4944-85c2-7422e72e9793","block_type":"box","text":"have specifically authorized such funds. There also are investment opportunities in certain of such countries in","page_number":79,"box":{"x":69,"y":211,"width":791,"height":11}},{"id":"cb819012-0c73-4ee7-bd33-e6bfd2e00b25","block_type":"box","text":"pooled vehicles that resemble open-end investment companies. The restrictions on investments in securities of","page_number":79,"box":{"x":70,"y":226,"width":795,"height":11}},{"id":"155d1966-3fea-48a7-a872-20843c140990","block_type":"box","text":"investment companies set forth above may limit opportunities for a Fund to invest indirectly in certain developing","page_number":79,"box":{"x":70,"y":241,"width":807,"height":11}},{"id":"d4130b1b-77c3-47ff-9b0b-a3a887bbfe7d","block_type":"box","text":"countries.","page_number":79,"box":{"x":69,"y":257,"width":69,"height":8}},{"id":"9fa5e99c-a46d-46bf-b431-c6177dd9e3a1","block_type":"box","text":"Issuer Insolvency Risk.","page_number":79,"box":{"x":102,"y":279,"width":166,"height":11}},{"id":"0072d1c6-4ad5-4d18-8928-8cef206432f6","block_type":"box","text":"Certain Funds’ potential exposure to financially or operationally troubled issuers involves","page_number":79,"box":{"x":275,"y":279,"width":631,"height":11}},{"id":"d597049c-c082-4545-ae32-f7c7f87d92b5","block_type":"box","text":"a high degree of credit and market risk, which may be heightened during an economic downturn or recession. Should","page_number":79,"box":{"x":69,"y":294,"width":832,"height":11}},{"id":"8f3019e3-edfe-4bb8-9a1d-6aed13bc9864","block_type":"box","text":"an issuer of securities held by a Fund become involved in a bankruptcy proceeding, reorganization or financial","page_number":79,"box":{"x":69,"y":309,"width":781,"height":11}},{"id":"8aff53c8-f596-4d1e-8123-47e40373d5e2","block_type":"box","text":"restructuring, a wide variety of considerations make an evaluation of the outcome of the Fund’s exposure to the","page_number":79,"box":{"x":69,"y":324,"width":797,"height":12}},{"id":"7e689d19-7e2d-44b2-b22b-14e22b93a19a","block_type":"box","text":"issuer uncertain.","page_number":79,"box":{"x":70,"y":340,"width":118,"height":8}},{"id":"5cbbab14-fba5-48e7-9ede-550ec7b3a92d","block_type":"box","text":"During the period of a bankruptcy proceeding, reorganization or financial restructuring, it is unlikely that a Fund","page_number":79,"box":{"x":102,"y":362,"width":788,"height":11}},{"id":"3cfd71ad-7fa5-4435-b383-6bb462b524b6","block_type":"box","text":"will receive any interest payments on the securities of the issuer. A Fund will be subject to significant uncertainty as","page_number":79,"box":{"x":68,"y":377,"width":827,"height":12}},{"id":"c74cd5b0-8948-44c2-8023-d3b82fca958a","block_type":"box","text":"to whether the reorganization or restructuring will be completed, and the Fund may bear certain extraordinary","page_number":79,"box":{"x":68,"y":393,"width":779,"height":11}},{"id":"599de600-6ff0-49ea-b64f-cc6d14254c42","block_type":"box","text":"expenses to protect and recover its investment. A Fund will also be subject to significant uncertainty as to when and","page_number":79,"box":{"x":69,"y":407,"width":829,"height":12}},{"id":"dd7c77f6-530b-4ec2-85d4-1cadfe851f32","block_type":"box","text":"in what manner and for what value the obligations evidenced by the securities of the issuer held by the Fund will","page_number":79,"box":{"x":70,"y":423,"width":797,"height":11}},{"id":"544a6bdf-103d-44b9-82c7-f24f94dfa02a","block_type":"box","text":"eventually be satisfied.","page_number":79,"box":{"x":69,"y":438,"width":162,"height":11}},{"id":"e1686ad9-ef03-4812-b2b8-b149f84c9925","block_type":"box","text":"Even if a plan of reorganization or restructuring is adopted with respect to the securities of the issuer held by the","page_number":79,"box":{"x":102,"y":460,"width":805,"height":12}},{"id":"5802435d-a57e-4588-a686-f028ae56a406","block_type":"box","text":"Fund, there can be no assurance that the securities or other assets received by a Fund in connection with such plan","page_number":79,"box":{"x":70,"y":476,"width":827,"height":11}},{"id":"aad29db9-50c1-4dcb-838e-24d236100448","block_type":"box","text":"of reorganization or restructuring will not have a lower value or income potential than may have been anticipated or","page_number":79,"box":{"x":69,"y":491,"width":819,"height":11}},{"id":"674208cc-14f2-42fc-9272-eff896b41ad9","block_type":"box","text":"no value. A Fund may be unable to enforce its claims or rights in any collateral or may have its claims or security","page_number":79,"box":{"x":69,"y":506,"width":802,"height":11}},{"id":"f66efe9d-645f-46c4-be0f-dfac1fb96d54","block_type":"box","text":"interest in any collateral challenged, disallowed or subordinated to the claims or security interests of other creditors.","page_number":79,"box":{"x":70,"y":521,"width":830,"height":11}},{"id":"a6671a76-4c51-4d13-8b53-888eae0a4fbf","block_type":"box","text":"In addition, amendments to the U.S. Bankruptcy Code or other relevant laws could alter the expected outcome or","page_number":79,"box":{"x":70,"y":536,"width":805,"height":11}},{"id":"b869326c-95fe-491f-89b3-632129ffd8db","block_type":"box","text":"introduce greater uncertainty regarding the outcome of the Fund’s securities holdings in the issuer. In a bankruptcy","page_number":79,"box":{"x":70,"y":551,"width":820,"height":11}},{"id":"6e86b72e-0f85-4bd6-b5f8-0adcd6e41679","block_type":"box","text":"proceeding, a reorganization or restructuring, the securities of the issuer held by a Fund could be re-characterized or","page_number":79,"box":{"x":70,"y":566,"width":828,"height":11}},{"id":"fd63af10-866e-463c-9141-ce3b65fa8036","block_type":"box","text":"a Fund may receive different securities or other assets, including equity securities. These types of equity securities","page_number":79,"box":{"x":69,"y":581,"width":820,"height":12}},{"id":"aace0dc8-ccb3-4c6c-b823-6dc1583ee511","block_type":"box","text":"include, but are not limited to: common stock; preferred stock (including convertible preferred stock); bonds, notes","page_number":79,"box":{"x":70,"y":596,"width":820,"height":12}},{"id":"d543f069-ed8f-46f4-9d2f-c0c904c26769","block_type":"box","text":"and debentures convertible into common or preferred stock; stock purchase warrants and rights; equity interests in","page_number":79,"box":{"x":69,"y":612,"width":824,"height":11}},{"id":"28336941-de32-4edf-afcd-3a3c4f53fd3a","block_type":"box","text":"trusts; and depositary receipts. Equity securities are subject to changes in value, and their value may be more","page_number":79,"box":{"x":68,"y":627,"width":788,"height":11}},{"id":"b08bf4a4-2140-467d-a580-952b1c3498f9","block_type":"box","text":"volatile than those of other asset classes. Holders of equity securities are subject to more risk than holders of debt","page_number":79,"box":{"x":68,"y":642,"width":826,"height":11}},{"id":"cb952bef-b9e5-458a-8709-a363679457fd","block_type":"box","text":"securities because the status of equity holders is subordinate to debtholders in an issuer’s capital structure. The","page_number":79,"box":{"x":69,"y":657,"width":809,"height":11}},{"id":"99f2b543-c69a-4da9-acdd-92eff4568e27","block_type":"box","text":"value of equity securities received by a Fund could decline if the financial condition of the issuer deteriorates or if","page_number":79,"box":{"x":68,"y":672,"width":809,"height":11}},{"id":"00cee9be-6c90-4797-8908-2819a93a34e6","block_type":"box","text":"overall market and economic conditions, or conditions within the issuer’s region or industry, deteriorate.","page_number":79,"box":{"x":69,"y":687,"width":741,"height":11}},{"id":"d4cb5a72-07fa-41e3-89f3-2651cc809f83","block_type":"box","text":"To the extent that a Fund receives other assets in connection with a bankruptcy proceeding, reorganization or","page_number":79,"box":{"x":101,"y":710,"width":780,"height":11}},{"id":"54136cb4-b67e-4200-8228-864ae99dbe6c","block_type":"box","text":"financial restructuring, the Fund may also be subject to additional risks associated with the assets received. One","page_number":79,"box":{"x":68,"y":725,"width":807,"height":11}},{"id":"c1096c80-ea08-46a3-8a19-98f829708318","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 part of a","page_number":79,"box":{"x":69,"y":740,"width":795,"height":11}},{"id":"53f52b98-df79-48c9-92e4-2fff238f266e","block_type":"box","text":"workout agreed to by a consortium of lienholders and creditors of the issuer. A Fund may receive such interests in","page_number":79,"box":{"x":68,"y":755,"width":814,"height":11}},{"id":"bb0cd371-5b95-42ad-815a-9b5157c63804","block_type":"box","text":"loans to the extent permitted by the Investment Company Act.","page_number":79,"box":{"x":70,"y":770,"width":439,"height":11}},{"id":"ca7f4341-f07d-406f-ab33-f486cdb7320c","block_type":"box","text":"Securities or other assets received in a reorganization or restructuring typically entail a higher degree of risk than","page_number":79,"box":{"x":102,"y":793,"width":806,"height":11}},{"id":"9aca9973-bf86-475e-8a55-adbd997c124a","block_type":"box","text":"investments in securities of issuers that have not undergone a reorganization or restructuring and may be subject to","page_number":79,"box":{"x":70,"y":808,"width":829,"height":11}},{"id":"a5e5a304-c448-49b1-a307-0b60531f7655","block_type":"box","text":"heavy selling or downward pricing pressure after completion of the reorganization or restructuring. The post","page_number":79,"box":{"x":69,"y":823,"width":767,"height":12}},{"id":"ed6cdd26-e022-41cf-94a8-524ea05771f4","block_type":"box","text":"reorganization/restructuring assets and securities may also be illiquid and difficult to sell or value. If a Fund","page_number":79,"box":{"x":69,"y":838,"width":771,"height":12}},{"id":"84450419-a2f5-4694-adad-525c7b1bce61","block_type":"box","text":"participates in negotiations with respect to a plan of reorganization or restructuring with respect to securities of the","page_number":79,"box":{"x":70,"y":853,"width":823,"height":12}},{"id":"48cfb693-90c6-4bb2-b675-b005c1d8407f","block_type":"box","text":"issuer held by a Fund, the Fund also may be restricted from disposing such securities for a period of time. If a Fund","page_number":79,"box":{"x":70,"y":869,"width":822,"height":11}},{"id":"ecc72126-57a5-4342-bafc-1a7f0bf66765","block_type":"box","text":"becomes involved in such proceedings, the Fund may have more active participation in the affairs of the issuer than","page_number":79,"box":{"x":69,"y":884,"width":828,"height":11}},{"id":"15f73e1f-0905-4b03-a6df-815b5c260135","block_type":"box","text":"that assumed generally by an investor.","page_number":79,"box":{"x":68,"y":899,"width":274,"height":11}},{"id":"47ac4997-6291-4f0c-a7b7-8dc8bc5bea9e","block_type":"box","text":"II-48","page_number":79,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"e9983023-9b8f-4526-8c5c-5b3785b9c91e","block_type":"box","text":"NM0926U-5977317-79/232","page_number":79,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"3e75e420-4070-4bf0-92b1-87a7550b4459","block_type":"box","text":"Lease Obligations.","page_number":80,"box":{"x":102,"y":45,"width":133,"height":11}},{"id":"7662bafe-30d5-4651-959f-78a5545efae0","block_type":"box","text":"A Fund may hold participation certificates in a lease, an installment purchase contract, or a","page_number":80,"box":{"x":241,"y":45,"width":653,"height":11}},{"id":"60609411-9cbf-4a06-9a45-9d77ea318f98","block_type":"box","text":"conditional sales contract (“lease obligations”). The Manager will monitor the credit standing of each borrower and","page_number":80,"box":{"x":69,"y":60,"width":816,"height":11}},{"id":"e6479982-4fa8-449a-b455-da9027c8d895","block_type":"box","text":"each entity providing credit support and/or a put option relating to lease obligations.","page_number":80,"box":{"x":69,"y":75,"width":602,"height":11}},{"id":"fd265e24-973b-4d31-add0-9f276a5921ed","block_type":"box","text":"Life Settlement Investments.","page_number":80,"box":{"x":102,"y":98,"width":210,"height":9}},{"id":"d202b370-1f2e-4ed7-a3e7-3f428d0931c4","block_type":"box","text":"A Fund may invest in life settlements, which are sales to third parties, such as the","page_number":80,"box":{"x":318,"y":98,"width":589,"height":11}},{"id":"b139cac6-26f5-4012-a3a4-ad7030f584f7","block_type":"box","text":"Fund, of existing life insurance contracts for more than their cash surrender value but less than the net benefits to be","page_number":80,"box":{"x":70,"y":113,"width":838,"height":11}},{"id":"52928de6-eb8e-44d7-b2ef-f15f00190f95","block_type":"box","text":"paid under the policies. When a Fund acquires such a contract, it pays the policy premiums in return for the expected","page_number":80,"box":{"x":70,"y":128,"width":834,"height":11}},{"id":"0e8264f7-d86e-410c-a69c-724460370e34","block_type":"box","text":"receipt of the net benefit as the beneficiary under the policy. Investments in these contracts involve certain risks,","page_number":80,"box":{"x":69,"y":143,"width":808,"height":11}},{"id":"d57ca895-716f-4479-9793-09ff5ca3669a","block_type":"box","text":"including liquidity risk, credit risk of the insurance company, and inaccurate estimations of life expectancy of the","page_number":80,"box":{"x":70,"y":158,"width":797,"height":11}},{"id":"2a69e1a0-32e9-4277-885a-7d0d13f18db4","block_type":"box","text":"insured individuals (viators). These policies may be considered illiquid because they are bought and sold in a","page_number":80,"box":{"x":70,"y":173,"width":775,"height":11}},{"id":"49617325-5668-4771-b64e-4dbd65585ed0","block_type":"box","text":"secondary market through life settlement agents. Also, in the event of a bankruptcy of the insurance carrier for a","page_number":80,"box":{"x":69,"y":188,"width":805,"height":12}},{"id":"27b64bd3-48f1-48a5-bc27-46423a25b7eb","block_type":"box","text":"policy, the Fund may receive reduced or no benefits under the contract. A Fund seeks to minimize credit risk by","page_number":80,"box":{"x":70,"y":203,"width":789,"height":12}},{"id":"d8abd99f-7a2a-4e4a-81a9-40a1e5effb1e","block_type":"box","text":"investing in policies issued by a diverse range of highly-rated insurance carriers. Furthermore, a Fund may encounter","page_number":80,"box":{"x":70,"y":218,"width":829,"height":12}},{"id":"1a0ec82e-b7d9-467d-8def-a229c8be854c","block_type":"box","text":"losses on its investments if there is an inaccurate estimation of the life expectancies of viators. A Fund intends to","page_number":80,"box":{"x":70,"y":234,"width":813,"height":11}},{"id":"917cfd2d-5555-4b14-8237-7f2480e601a9","block_type":"box","text":"reduce this life expectancy risk by investing only in contracts where the life expectancy was reviewed by an","page_number":80,"box":{"x":69,"y":249,"width":758,"height":11}},{"id":"16bc19e6-ddfb-418b-9ac6-41221a5a1940","block_type":"box","text":"experienced actuary, as well as by diversifying its investments across viators of varying ages and medical profiles. In","page_number":80,"box":{"x":69,"y":264,"width":832,"height":11}},{"id":"d7b902ce-06a2-40fc-a906-da929efc9b95","block_type":"box","text":"addition, it is unclear whether the income from life settlements is qualifying income for purposes of the IRS 90%","page_number":80,"box":{"x":69,"y":279,"width":800,"height":11}},{"id":"3ffb7709-106c-46dc-ad2d-96ccc4a00110","block_type":"box","text":"gross income test a Fund must satisfy each year to qualify as a regulated investment company. A Fund intends to","page_number":80,"box":{"x":68,"y":294,"width":809,"height":11}},{"id":"8a0be988-b796-4ae2-bae4-87c84394ae64","block_type":"box","text":"monitor its investments to ensure that the Fund remains qualified as a regulated investment company.","page_number":80,"box":{"x":69,"y":309,"width":730,"height":11}},{"id":"2d27149b-6a31-491f-a2d7-b92025a90352","block_type":"box","text":"Liquidity Risk Management.","page_number":80,"box":{"x":102,"y":332,"width":202,"height":11}},{"id":"86caa2df-9f63-45e1-9761-e5f1131974c9","block_type":"box","text":"Rule 22e-4 under the Investment Company Act (the “Liquidity Rule”) requires open","page_number":80,"box":{"x":311,"y":332,"width":591,"height":11}},{"id":"8ce170d5-4617-4099-a7ad-8255561a1dc2","block_type":"box","text":"end funds, such as the Funds, to adopt a liquidity risk management program and enhance disclosures regarding fund","page_number":80,"box":{"x":69,"y":347,"width":835,"height":11}},{"id":"828bf813-8286-421b-aa42-ef1f0c5884e2","block_type":"box","text":"liquidity. As required by the Liquidity Rule, the Funds have implemented a liquidity risk management program (the","page_number":80,"box":{"x":70,"y":362,"width":803,"height":11}},{"id":"c1aaaecf-5a8b-41dd-9915-42e92b0624c0","block_type":"box","text":"“Liquidity Program”), and the Boards of Directors of the Funds, including a majority of the independent Directors,","page_number":80,"box":{"x":70,"y":377,"width":801,"height":12}},{"id":"044803a4-5897-43fb-996f-e0696445c6ee","block_type":"box","text":"have appointed the Manager as the liquidity risk program administrator of the Liquidity Program. Under the Liquidity","page_number":80,"box":{"x":69,"y":392,"width":822,"height":12}},{"id":"6a6017b6-9079-41f5-8f67-f0d109391539","block_type":"box","text":"Program, the Manager assesses, manages, and periodically reviews each Fund’s liquidity risk and classifies each","page_number":80,"box":{"x":69,"y":407,"width":808,"height":12}},{"id":"b2a8844d-38b2-48ba-9e1a-fe57efb7ca01","block_type":"box","text":"investment held by a Fund as a “highly liquid investment,” “moderately liquid investment,” “less liquid investment” or","page_number":80,"box":{"x":70,"y":423,"width":838,"height":11}},{"id":"f960ec58-92a4-4bd8-98b1-17a2cd243ac8","block_type":"box","text":"“illiquid investment.” The Liquidity Rule defines “liquidity risk” as the risk that a Fund could not meet requests to","page_number":80,"box":{"x":70,"y":438,"width":804,"height":11}},{"id":"8e175b51-f735-4c9a-94c7-89f051916342","block_type":"box","text":"redeem shares issued by the Fund without significant dilution of the remaining investors’ interests in the Fund. The","page_number":80,"box":{"x":69,"y":453,"width":821,"height":11}},{"id":"fa117c41-6dc4-4fdc-b9f0-59c39e694187","block_type":"box","text":"liquidity of a Fund’s portfolio investments is determined based on relevant market, trading and investment-specific","page_number":80,"box":{"x":70,"y":468,"width":815,"height":11}},{"id":"6b47a9fd-7c5f-494a-a0ba-adb706cbbb47","block_type":"box","text":"considerations under the Liquidity Program. To the extent that an investment is deemed to be an illiquid investment","page_number":80,"box":{"x":69,"y":483,"width":823,"height":11}},{"id":"183d4033-80ee-4943-8008-981a04810da6","block_type":"box","text":"or a less liquid investment, a Fund can expect to be exposed to greater liquidity risk.","page_number":80,"box":{"x":69,"y":498,"width":601,"height":11}},{"id":"d1fe770b-9348-46a6-bb10-7eca4f0c999e","block_type":"box","text":"Master Limited Partnerships.","page_number":80,"box":{"x":102,"y":521,"width":211,"height":11}},{"id":"869a1ffa-cc98-4144-9d81-9f3446cf4ddd","block_type":"box","text":"Certain Funds may invest in publicly traded master limited partnerships (“MLPs”)","page_number":80,"box":{"x":320,"y":521,"width":577,"height":11}},{"id":"0d7abab1-c989-441a-97fd-b8ac0aff30dd","block_type":"box","text":"which are limited partnerships or limited liability companies taxable as partnerships. MLPs may derive income and","page_number":80,"box":{"x":68,"y":536,"width":816,"height":11}},{"id":"4e818fc5-707e-492e-8cb1-46a391caec61","block_type":"box","text":"gains from the exploration, development, mining or production, processing, refining, transportation (including","page_number":80,"box":{"x":68,"y":551,"width":777,"height":11}},{"id":"5f051aff-91e7-4919-8627-b5a6dbd00972","block_type":"box","text":"pipelines transporting gas, oil, or products thereof), or the marketing of any mineral or natural resources. MLPs","page_number":80,"box":{"x":70,"y":566,"width":792,"height":11}},{"id":"9998242e-fcd3-41e0-bea0-c33265739953","block_type":"box","text":"generally have two classes of owners, the general partner and limited partners. When investing in an MLP, a Fund","page_number":80,"box":{"x":68,"y":581,"width":811,"height":12}},{"id":"0efdb03b-a2c1-408f-9095-5c8c3f30363d","block_type":"box","text":"intends to purchase publicly traded common units issued to limited partners of the MLP. The general partner is","page_number":80,"box":{"x":70,"y":596,"width":791,"height":12}},{"id":"ac703a46-a49d-4b48-a905-e23859338c50","block_type":"box","text":"typically owned by a major energy company, an investment fund, the direct management of the MLP or is an entity","page_number":80,"box":{"x":68,"y":612,"width":812,"height":11}},{"id":"6964cc2a-515e-407e-ad2c-c215af486c3a","block_type":"box","text":"owned by one or more of such parties. The general partner may be structured as a private or publicly traded","page_number":80,"box":{"x":69,"y":627,"width":770,"height":11}},{"id":"6eadbc9b-7dba-4de1-bb5a-905369a32e3a","block_type":"box","text":"corporation or other entity. The general partner typically controls the operations and management of the MLP through","page_number":80,"box":{"x":69,"y":642,"width":833,"height":11}},{"id":"b02d699b-3fdd-40ee-9b9c-d7f26bad138f","block_type":"box","text":"an up to 2% equity interest in the MLP plus, in many cases, ownership of common units and subordinated units.","page_number":80,"box":{"x":69,"y":657,"width":799,"height":11}},{"id":"f662696d-bc27-448b-8beb-b1bc60b3df9c","block_type":"box","text":"Limited partners own the remainder of the partnership, through ownership of common units, and have a limited role","page_number":80,"box":{"x":70,"y":672,"width":825,"height":11}},{"id":"e751c6cf-7be8-4be9-bc1c-fb23f650ff4b","block_type":"box","text":"in the partnership’s operations and management.","page_number":80,"box":{"x":70,"y":687,"width":352,"height":11}},{"id":"50b0b94d-c164-4e99-a2e4-f81fa5cae50b","block_type":"box","text":"MLPs are typically structured such that common units and general partner interests have first priority to receive","page_number":80,"box":{"x":102,"y":710,"width":794,"height":11}},{"id":"255796c9-ed67-4c5b-993a-988c8ad49ef0","block_type":"box","text":"quarterly cash distributions up to an established minimum amount (“minimum quarterly distributions” or “MQD”).","page_number":80,"box":{"x":69,"y":725,"width":809,"height":11}},{"id":"5f962781-70fb-4972-bc3e-8523bd573a81","block_type":"box","text":"Common and general partner interests also accrue arrearages in distributions to the extent the MQD is not paid.","page_number":80,"box":{"x":69,"y":740,"width":804,"height":11}},{"id":"be0ebb84-b8e2-4a6d-af53-e6af2a47c3b9","block_type":"box","text":"Once common and general partner interests have been paid, subordinated units receive distributions of up to the","page_number":80,"box":{"x":69,"y":755,"width":808,"height":11}},{"id":"8b6426d7-3a76-4fd2-a059-02ebbcd690be","block_type":"box","text":"MQD; however, subordinated units do not accrue arrearages. Distributable cash in excess of the MQD paid to both","page_number":80,"box":{"x":70,"y":770,"width":816,"height":12}},{"id":"61d21129-f62f-4b59-bf2b-dbc73c90e995","block_type":"box","text":"common and subordinated units is distributed to both common and subordinated units generally on a pro rata basis.","page_number":80,"box":{"x":69,"y":786,"width":831,"height":11}},{"id":"6695c774-c8f1-4c11-a742-2e32d3e975f4","block_type":"box","text":"The general partner is also eligible to receive incentive distributions if the general partner operates the business in a","page_number":80,"box":{"x":68,"y":801,"width":835,"height":11}},{"id":"81806bd2-ce7d-4f94-b096-ecb6a5c1f6f6","block_type":"box","text":"manner which results in distributions paid per common unit surpassing specified target levels. As the general partner","page_number":80,"box":{"x":69,"y":816,"width":838,"height":11}},{"id":"0c1f7d9e-4787-4102-82c8-8c16aa64e782","block_type":"box","text":"increases cash distributions to the limited partners, the general partner receives an increasingly higher percentage of","page_number":80,"box":{"x":70,"y":831,"width":839,"height":11}},{"id":"d7252878-40d1-4287-a2d9-99fef293226b","block_type":"box","text":"the incremental cash distributions. A common arrangement provides that the general partner can reach a tier where","page_number":80,"box":{"x":68,"y":846,"width":828,"height":11}},{"id":"70479e96-b3e2-4849-8fa9-85f640d17c35","block_type":"box","text":"it receives 50% of every incremental dollar paid to common and subordinated unit holders. These incentive","page_number":80,"box":{"x":70,"y":861,"width":761,"height":11}},{"id":"68efc851-224d-4b5b-9a9b-763c55f6bf41","block_type":"box","text":"distributions encourage the general partner to streamline costs, increase capital expenditures and acquire assets in","page_number":80,"box":{"x":69,"y":876,"width":830,"height":11}},{"id":"c6542cc5-bb17-4743-b380-677385bed529","block_type":"box","text":"order to increase the partnership’s cash flow and raise the quarterly cash distribution in order to reach higher tiers.","page_number":80,"box":{"x":69,"y":891,"width":824,"height":12}},{"id":"8c3035b9-b9e0-4b44-9e33-7274c2c26268","block_type":"box","text":"Such results benefit all security holders of the MLP.","page_number":80,"box":{"x":69,"y":906,"width":366,"height":12}},{"id":"46143a77-932a-470c-bea7-29e59c59c154","block_type":"box","text":"II-49","page_number":80,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"8914c445-d6b6-4ca4-8eb6-0bfa4f7b3ddb","block_type":"box","text":"NM0926U-5977317-80/232","page_number":80,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"caa99483-9521-4aa6-99f7-51abc0c6b730","block_type":"box","text":"MLP common units represent a limited partnership interest in the MLP. Common units are listed and traded on","page_number":81,"box":{"x":102,"y":45,"width":790,"height":11}},{"id":"12f8705d-5234-430a-92eb-50ddc898152c","block_type":"box","text":"U.S. securities exchanges, with their value fluctuating predominantly based on prevailing market conditions and the","page_number":81,"box":{"x":70,"y":60,"width":820,"height":11}},{"id":"9d982a25-e7fa-44d7-9742-546eb8d0accb","block_type":"box","text":"success of the MLP. Certain Funds intend to purchase common units in market transactions. Unlike owners of","page_number":81,"box":{"x":69,"y":75,"width":787,"height":11}},{"id":"cca66d8c-9c08-476f-8534-3dca19700899","block_type":"box","text":"common stock of a corporation, owners of common units have limited voting rights and have no ability to annually","page_number":81,"box":{"x":69,"y":90,"width":810,"height":11}},{"id":"e2ba2e2c-d8b0-466c-9090-3dc3a581a639","block_type":"box","text":"elect directors. In the event of liquidation, common units have preference over subordinated units, but not over debt","page_number":81,"box":{"x":69,"y":105,"width":828,"height":11}},{"id":"1ace6178-878b-4c31-adc3-3e62504032c7","block_type":"box","text":"or preferred units, to the remaining assets of the MLP.","page_number":81,"box":{"x":69,"y":120,"width":387,"height":12}},{"id":"a54af693-a0b8-4e92-afb5-c1415eedda09","block_type":"box","text":"Merger Transaction Risk.","page_number":81,"box":{"x":102,"y":143,"width":183,"height":11}},{"id":"f3d5ae9e-a0a8-4bdd-8582-3e6ea1ee64e7","block_type":"box","text":"A Fund may buy stock of the target company in an announced merger transaction prior","page_number":81,"box":{"x":291,"y":143,"width":616,"height":11}},{"id":"453404d5-ad5c-4eba-991d-e425cf5cb8ed","block_type":"box","text":"to the consummation of such transaction. In that circumstance, a Fund would expect to receive an amount (whether","page_number":81,"box":{"x":68,"y":158,"width":827,"height":11}},{"id":"b1385bff-2aa2-4495-836e-5c033d464417","block_type":"box","text":"in cash, stock of the acquiring company or a combination of both) in excess of the purchase price paid by the Fund","page_number":81,"box":{"x":70,"y":173,"width":816,"height":11}},{"id":"7310d424-4fd9-421e-9e8a-b212c2e7e7aa","block_type":"box","text":"for the target company’s stock. However, a Fund is subject to the risk that the merger transaction may be canceled,","page_number":81,"box":{"x":68,"y":188,"width":825,"height":12}},{"id":"d4a8bd1b-cdf6-43af-8c53-2b008cca85a7","block_type":"box","text":"delayed or restructured, in which case a Fund’s holding of the target company’s stock may not result in any profit for","page_number":81,"box":{"x":69,"y":203,"width":832,"height":12}},{"id":"35093c46-aac2-400a-acbb-b7c341261fde","block_type":"box","text":"the Fund and may lose significant value.","page_number":81,"box":{"x":68,"y":218,"width":286,"height":12}},{"id":"003c6540-5a3d-47b4-b5c5-dcf2837c43de","block_type":"box","text":"Money Market Obligations of Domestic Banks, Foreign Banks and Foreign Branches of U.S. Banks.","page_number":81,"box":{"x":102,"y":241,"width":723,"height":11}},{"id":"92c23882-9716-4791-8970-c4a5b8b8eea2","block_type":"box","text":"Certain","page_number":81,"box":{"x":831,"y":241,"width":50,"height":9}},{"id":"d7cab377-78c3-4771-96e5-322785b5c00a","block_type":"box","text":"Funds may purchase bank obligations, such as certificates of deposit, notes, bankers’ acceptances and time","page_number":81,"box":{"x":70,"y":256,"width":778,"height":12}},{"id":"38012630-6b39-46a6-b456-c3e7ff0cfde0","block_type":"box","text":"deposits, including instruments issued or supported by the credit of U.S. or foreign banks or savings institutions","page_number":81,"box":{"x":69,"y":271,"width":802,"height":12}},{"id":"3a55690c-4982-4c60-93f7-615df45236f9","block_type":"box","text":"having total assets at the time of purchase in excess of $1 billion. These obligations may be general obligations of","page_number":81,"box":{"x":69,"y":286,"width":820,"height":12}},{"id":"1d491a85-56eb-4302-bd1d-57b299d53d43","block_type":"box","text":"the parent bank or may be limited to the issuing branch or subsidiary by the terms of a specific obligation or by","page_number":81,"box":{"x":68,"y":302,"width":794,"height":11}},{"id":"d0b2359e-675d-4816-8072-c0e8d4be055b","block_type":"box","text":"government regulation. The assets of a bank or savings institution will be deemed to include the assets of its","page_number":81,"box":{"x":68,"y":317,"width":781,"height":11}},{"id":"0504454a-b7b1-4f61-9eba-132b8aab3395","block_type":"box","text":"domestic and foreign branches for purposes of a Fund’s investment policies. Investments in short-term bank","page_number":81,"box":{"x":69,"y":332,"width":776,"height":11}},{"id":"9b8e598e-7a28-4d07-984a-c8efba5ce4b1","block_type":"box","text":"obligations may include obligations of foreign banks and domestic branches of foreign banks, and also foreign","page_number":81,"box":{"x":69,"y":347,"width":785,"height":11}},{"id":"ee16444f-4344-4294-836b-a1e77c678cee","block_type":"box","text":"branches of domestic banks.","page_number":81,"box":{"x":69,"y":362,"width":205,"height":9}},{"id":"a5569324-18a8-4ebb-a329-a838089d9e80","block_type":"box","text":"To the extent consistent with their investment objectives, a Fund may invest in debt obligations of domestic or","page_number":81,"box":{"x":101,"y":385,"width":785,"height":11}},{"id":"e49c0b82-2d88-48b8-a557-9823e80013b8","block_type":"box","text":"foreign corporations and banks, and may acquire commercial obligations issued by Canadian corporations and","page_number":81,"box":{"x":68,"y":400,"width":787,"height":11}},{"id":"7690f038-f3d3-48a4-b227-b8a49f920b4d","block_type":"box","text":"Canadian counterparts of U.S. corporations, as well as Europaper, which is U.S. dollar-denominated commercial","page_number":81,"box":{"x":69,"y":415,"width":797,"height":11}},{"id":"0a3ffd44-1cad-4a33-b0be-e73a7e564165","block_type":"box","text":"paper of a foreign issuer.","page_number":81,"box":{"x":70,"y":430,"width":176,"height":11}},{"id":"630e4195-f994-4b25-a5f9-5aa3079b3653","block_type":"box","text":"Money Market Securities.","page_number":81,"box":{"x":102,"y":453,"width":188,"height":11}},{"id":"14d04f15-67c6-4f98-a5c8-38027d690b09","block_type":"box","text":"Certain Funds may invest in a broad range of short-term, high quality, U.S. dollar","page_number":81,"box":{"x":296,"y":453,"width":578,"height":11}},{"id":"5b802d11-736a-46cf-96aa-ff45ac49cdc8","block_type":"box","text":"denominated instruments, such as government, bank, commercial and other obligations that are available in the","page_number":81,"box":{"x":69,"y":468,"width":802,"height":11}},{"id":"6c18ee67-650b-4ec3-9c3e-01d40420946f","block_type":"box","text":"money markets. In particular, the Funds may invest in:","page_number":81,"box":{"x":69,"y":483,"width":386,"height":11}},{"id":"5d6d80ac-144b-42e0-b42f-7e1d7cbb2fa9","block_type":"box","text":"(a) U.S. dollar-denominated obligations issued or supported by the credit of U.S. or foreign banks or savings","page_number":81,"box":{"x":69,"y":503,"width":779,"height":12}},{"id":"619f546a-4aa3-468e-86cf-616d793cf8e2","block_type":"box","text":"institutions with total assets in excess of $1 billion (including obligations of foreign branches of such banks);","page_number":81,"box":{"x":102,"y":518,"width":776,"height":12}},{"id":"24cf7b39-d5c6-42aa-9548-5ecfc76b497a","block_type":"box","text":"(b) high quality commercial paper and other obligations issued or guaranteed by U.S. and foreign corporations and","page_number":81,"box":{"x":69,"y":538,"width":821,"height":12}},{"id":"63505f43-1950-4c6c-98c2-cbb2885009cd","block_type":"box","text":"other issuers rated (at the time of purchase) A-2 or higher by S&P, Prime-2 or higher by Moody’s or F-2 or higher","page_number":81,"box":{"x":102,"y":554,"width":795,"height":11}},{"id":"a1b41168-299b-41ef-8cf4-9065d2a83f0c","block_type":"box","text":"by Fitch, as well as high quality corporate bonds rated (at the time of purchase) A or higher by those rating","page_number":81,"box":{"x":102,"y":569,"width":757,"height":11}},{"id":"99bce638-6c0e-4e19-bd44-c628907318b4","block_type":"box","text":"agencies;","page_number":81,"box":{"x":102,"y":584,"width":66,"height":11}},{"id":"4cc7483b-7427-48b2-9f64-c04bc7d8f090","block_type":"box","text":"(c) unrated notes, paper and other instruments that are of comparable quality to the instruments described in","page_number":81,"box":{"x":69,"y":604,"width":792,"height":11}},{"id":"d8921e28-e362-4c3f-b680-f36e1c8ac5a8","block_type":"box","text":"(b) above as determined by the Fund’s Manager;","page_number":81,"box":{"x":102,"y":619,"width":344,"height":11}},{"id":"28e58999-c9c2-4dfc-9aa5-fac7e42f2126","block_type":"box","text":"(d) asset-backed securities (including interests in pools of assets such as mortgages, installment purchase","page_number":81,"box":{"x":69,"y":639,"width":776,"height":12}},{"id":"0275bfaa-0a7f-488c-97e1-b4f7d338633e","block_type":"box","text":"obligations and credit card receivables);","page_number":81,"box":{"x":102,"y":655,"width":283,"height":11}},{"id":"971d5945-8042-4347-b770-976f9eaacb16","block_type":"box","text":"(e) securities issued or guaranteed as to principal and interest by the U.S. Government or by its agencies or","page_number":81,"box":{"x":69,"y":675,"width":778,"height":11}},{"id":"e59563ef-a42d-41cc-86f6-3fd2233b399a","block_type":"box","text":"authorities and related custodial receipts;","page_number":81,"box":{"x":102,"y":690,"width":296,"height":11}},{"id":"d2fbc436-2ddd-4861-9273-50cef00399c8","block_type":"box","text":"(f) dollar-denominated securities issued or guaranteed by foreign governments or their political subdivisions,","page_number":81,"box":{"x":69,"y":710,"width":782,"height":11}},{"id":"64c1233d-fdc8-4a4c-b3ef-72c7a97ecf0c","block_type":"box","text":"agencies or authorities;","page_number":81,"box":{"x":102,"y":725,"width":166,"height":11}},{"id":"9eba0ea8-8781-46dd-8307-d0e3426115a8","block_type":"box","text":"(g) funding agreements issued by highly-rated U.S. insurance companies;","page_number":81,"box":{"x":69,"y":745,"width":528,"height":11}},{"id":"48beef88-66b4-4bda-9103-21226afce3d0","block_type":"box","text":"(h) securities issued or guaranteed by state or local governmental bodies;","page_number":81,"box":{"x":69,"y":766,"width":534,"height":11}},{"id":"17963612-eae6-42e2-9129-588757a352d2","block_type":"box","text":"(i) repurchase agreements relating to the above instruments;","page_number":81,"box":{"x":69,"y":786,"width":447,"height":11}},{"id":"10593b17-0cc0-4f08-8d0a-ce46fe41e9ba","block_type":"box","text":"(j) municipal bonds and notes whose principal and interest payments are guaranteed by the U.S. Government or","page_number":81,"box":{"x":69,"y":806,"width":812,"height":11}},{"id":"a38a5e1e-4db0-4dd7-85e3-d62048abe89e","block_type":"box","text":"one of its agencies or authorities or which otherwise depend directly or indirectly on the credit of the United","page_number":81,"box":{"x":102,"y":821,"width":766,"height":11}},{"id":"aab79ef7-9a3a-48ca-b93f-0f89d79a4f23","block_type":"box","text":"States;","page_number":81,"box":{"x":102,"y":836,"width":49,"height":10}},{"id":"2b684398-2e44-4e29-bff4-2d22c9e2f542","block_type":"box","text":"(k) fixed and variable rate notes and similar debt instruments rated MIG-2, VMIG-2 or Prime-2 or higher by Moody’s,","page_number":81,"box":{"x":69,"y":856,"width":829,"height":11}},{"id":"dde35b70-de7f-47b3-9105-2a300afeffd2","block_type":"box","text":"SP-2 or A-2 or higher by S&P, or F-2 or higher by Fitch;","page_number":81,"box":{"x":102,"y":871,"width":379,"height":11}},{"id":"55637745-3859-4f1f-997f-4a77951eada6","block_type":"box","text":"(l) tax-exempt commercial paper and similar debt instruments rated Prime-2 or higher by Moody’s, A-2 or higher by","page_number":81,"box":{"x":69,"y":891,"width":826,"height":12}},{"id":"7b17e320-1d82-4874-beaa-2e210320c41c","block_type":"box","text":"S&P, or F-2 or higher by Fitch;","page_number":81,"box":{"x":102,"y":906,"width":207,"height":12}},{"id":"2952f149-6f73-4cdb-8b37-260b31116feb","block_type":"box","text":"II-50","page_number":81,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"0c3d5770-b068-49c7-b094-c1eb160839b1","block_type":"box","text":"NM0926U-5977317-81/232","page_number":81,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"cbe80dd5-d2d7-4944-b022-dd52a6f54bba","block_type":"box","text":"(m) municipal bonds rated A or higher by Moody’s, S&P or Fitch;","page_number":82,"box":{"x":69,"y":45,"width":458,"height":11}},{"id":"8160f2b7-9e28-426c-a7d6-10bae22198ef","block_type":"box","text":"(n) unrated notes, paper or other instruments that are of comparable quality to the instruments described above, as","page_number":82,"box":{"x":69,"y":65,"width":837,"height":11}},{"id":"d696d8e8-36ac-4953-b61a-4763cc0708e5","block_type":"box","text":"determined by the Fund’s Manager under guidelines established by the Board; and","page_number":82,"box":{"x":101,"y":80,"width":589,"height":11}},{"id":"9f94bea8-4c74-4c44-ba1d-e4675daa1dce","block_type":"box","text":"(o) municipal bonds and notes which are guaranteed as to principal and interest by the U.S. Government or an","page_number":82,"box":{"x":69,"y":100,"width":795,"height":11}},{"id":"509f1fd9-dc07-4391-811b-6f93f1c70a2d","block_type":"box","text":"agency or instrumentality thereof or which otherwise depend directly or indirectly on the credit of the United","page_number":82,"box":{"x":102,"y":115,"width":764,"height":11}},{"id":"c37e8eeb-35e9-4d0f-b373-6bf2e2ba6b2c","block_type":"box","text":"States.","page_number":82,"box":{"x":102,"y":130,"width":49,"height":9}},{"id":"8a1bfe37-ba99-4035-b8f8-c56925259539","block_type":"box","text":"Mortgage-Related Securities.","page_number":82,"box":{"x":102,"y":153,"width":213,"height":11}},{"id":"9a17f885-e3ad-4cc5-8e77-d953ec8c1384","block_type":"box","text":"Mor tgage-Backed Securities.","page_number":82,"box":{"x":102,"y":176,"width":203,"height":11}},{"id":"ddee4a01-f604-44ce-be67-60cd109db84a","block_type":"box","text":"Mortgage-backed securities represent interests in pools of mortgages in which","page_number":82,"box":{"x":312,"y":176,"width":560,"height":11}},{"id":"b9637193-b3c1-4f1c-abb7-666c840e043b","block_type":"box","text":"payments of both principal and interest on the securities are generally made monthly, in effect “passing through”","page_number":82,"box":{"x":70,"y":191,"width":805,"height":11}},{"id":"e586af1d-5af1-46e9-ad2b-447763b0e0f3","block_type":"box","text":"monthly payments made by borrowers on the residential or commercial mortgage loans that underlie the securities","page_number":82,"box":{"x":69,"y":206,"width":819,"height":11}},{"id":"351d5f91-09ee-4b20-a591-475cc73652c7","block_type":"box","text":"(net of any fees paid to the issuer or guarantor of the securities). Mortgage-backed securities differ from other forms","page_number":82,"box":{"x":69,"y":221,"width":832,"height":11}},{"id":"f5c96664-b013-402a-b540-edd86138416b","block_type":"box","text":"of debt securities, which normally provide for periodic payment of interest in fixed amounts with principal payments at","page_number":82,"box":{"x":69,"y":236,"width":838,"height":11}},{"id":"61a91b82-af1e-4506-a163-5c152b0b7100","block_type":"box","text":"maturity or specified call dates.","page_number":82,"box":{"x":69,"y":251,"width":222,"height":11}},{"id":"61dd918c-7354-4e4f-8461-c483ed328b7c","block_type":"box","text":"Mortgage-backed securities are subject to the general risks associated with investing in real estate securities;","page_number":82,"box":{"x":102,"y":274,"width":785,"height":11}},{"id":"18ea13a2-71e5-4aec-862c-06ee63a4a1df","block_type":"box","text":"that is, they may lose value if the value of the underlying real estate to which a pool of mortgages relates declines. In","page_number":82,"box":{"x":68,"y":289,"width":838,"height":11}},{"id":"1504de5a-6c7c-47d2-98d2-998396326bd8","block_type":"box","text":"addition, investments in mortgage-backed securities involve certain specific risks. These risks include the failure of a","page_number":82,"box":{"x":69,"y":304,"width":836,"height":11}},{"id":"2e04656f-c285-4d8a-ab8b-2908ab9c3f2e","block_type":"box","text":"party to meet its commitments under the related operative documents, adverse interest rate changes and the effects","page_number":82,"box":{"x":70,"y":319,"width":837,"height":12}},{"id":"e1c48ba5-9a44-4730-8227-efdebab3ff75","block_type":"box","text":"of prepayments on mortgage cash flows. Mortgage-backed securities are “pass-through” securities, meaning that","page_number":82,"box":{"x":69,"y":334,"width":810,"height":12}},{"id":"a9912225-2160-4df6-861f-e41d6681dc88","block_type":"box","text":"principal and interest payments made by the borrower on the underlying mortgages are passed through to a Fund.","page_number":82,"box":{"x":70,"y":350,"width":811,"height":11}},{"id":"adf6a6cc-e1a7-4907-80b6-80a7138bb138","block_type":"box","text":"Accordingly, the value of mortgage-backed securities in which a Fund invests may be particularly sensitive to changes","page_number":82,"box":{"x":68,"y":365,"width":837,"height":11}},{"id":"607fc7b5-7e36-4df9-bd8d-9413ece1c569","block_type":"box","text":"in prevailing interest rates, and, like other fixed income investments, the ability of a Fund to utilize these instruments","page_number":82,"box":{"x":70,"y":380,"width":834,"height":11}},{"id":"a0c60ec5-7041-4557-b6c9-29fd8c14bab4","block_type":"box","text":"successfully may depend in part upon the ability of the Manager to forecast interest rates and other economic factors","page_number":82,"box":{"x":69,"y":395,"width":840,"height":11}},{"id":"d9492a1d-900e-4123-912c-a04d77902f44","block_type":"box","text":"correctly. The value of mortgage-backed securities, like that of traditional fixed-income securities, typically increases","page_number":82,"box":{"x":69,"y":410,"width":827,"height":11}},{"id":"edd1a366-0696-4937-87ca-39e6ea71e868","block_type":"box","text":"when interest rates fall and decreases when interest rates rise. However, mortgage-backed securities differ from","page_number":82,"box":{"x":68,"y":425,"width":805,"height":11}},{"id":"7390198e-a9f2-48f2-99c3-2163d7780aa1","block_type":"box","text":"traditional fixed-income securities because of their potential for prepayment without penalty. The price paid by a Fund","page_number":82,"box":{"x":68,"y":440,"width":834,"height":11}},{"id":"3e176abd-7b76-4494-b204-5f7c9118907d","block_type":"box","text":"for its mortgage-backed securities, the yield the Fund expects to receive from such securities and the weighted","page_number":82,"box":{"x":68,"y":455,"width":791,"height":12}},{"id":"faef2e12-a7fc-4b97-acf3-e8bb1b840c45","block_type":"box","text":"average life of the securities are based on a number of factors, including the anticipated rate of prepayment of the","page_number":82,"box":{"x":69,"y":470,"width":816,"height":12}},{"id":"1a241ee9-c3ac-47c1-b3f7-8dda0bc71669","block_type":"box","text":"underlying mortgages. In a period of declining interest rates, borrowers may prepay the underlying mortgages more","page_number":82,"box":{"x":69,"y":486,"width":819,"height":11}},{"id":"608cd87b-2a1a-4010-83c6-590c13e91bca","block_type":"box","text":"quickly than anticipated, thereby reducing the yield to maturity and the average life of the mortgage-backed","page_number":82,"box":{"x":69,"y":501,"width":761,"height":11}},{"id":"1d664251-d1cd-4a75-a076-f7396015ff2b","block_type":"box","text":"securities. Moreover, when a Fund reinvests the proceeds of a prepayment in these circumstances, it will likely","page_number":82,"box":{"x":69,"y":516,"width":791,"height":11}},{"id":"170488aa-de53-4e2a-88c1-b9b506a7cc23","block_type":"box","text":"receive a rate of interest that is lower than the rate on the security that was prepaid.","page_number":82,"box":{"x":69,"y":531,"width":602,"height":11}},{"id":"63a03944-a808-4b61-aa6f-9231e5a7435e","block_type":"box","text":"To the extent that a Fund purchases mortgage-backed securities at a premium, mortgage foreclosures and","page_number":82,"box":{"x":101,"y":554,"width":761,"height":11}},{"id":"df926b0f-8c6d-4e9d-87ae-ab978a1fab29","block_type":"box","text":"principal prepayments may result in a loss to the extent of the premium paid. If a Fund buys such securities at a","page_number":82,"box":{"x":70,"y":569,"width":800,"height":11}},{"id":"4cfce00b-02da-406c-9a47-0420d772ef2c","block_type":"box","text":"discount, both scheduled payments of principal and unscheduled prepayments will increase current and total returns","page_number":82,"box":{"x":69,"y":584,"width":833,"height":11}},{"id":"4db61e83-8022-4631-b36a-202d3da60554","block_type":"box","text":"and will accelerate the recognition of income, which, when distributed to shareholders, will be taxable as ordinary","page_number":82,"box":{"x":69,"y":599,"width":809,"height":11}},{"id":"de9db3de-b4e0-4225-8eec-dd13349609c4","block_type":"box","text":"income. In a period of rising interest rates, prepayments of the underlying mortgages may occur at a slower than","page_number":82,"box":{"x":70,"y":614,"width":801,"height":11}},{"id":"55425511-59bf-4ba5-bc5c-8da674a3b113","block_type":"box","text":"expected rate, creating maturity extension risk. This particular risk may effectively change a security that was","page_number":82,"box":{"x":69,"y":629,"width":778,"height":11}},{"id":"60f6ee02-c5fd-4507-b3e7-a6a1b5f21a6a","block_type":"box","text":"considered short- or intermediate-term at the time of purchase into a long-term security. Since the value of long-term","page_number":82,"box":{"x":69,"y":644,"width":831,"height":12}},{"id":"096aa11a-90e1-4efb-b657-e38baf46f335","block_type":"box","text":"securities generally fluctuates more widely in response to changes in interest rates than that of shorter-term","page_number":82,"box":{"x":69,"y":659,"width":773,"height":12}},{"id":"7484ed75-167a-45c2-9a37-38fe5e69ea59","block_type":"box","text":"securities, maturity extension risk could increase the inherent volatility of the Fund. Under certain interest rate and","page_number":82,"box":{"x":69,"y":675,"width":818,"height":11}},{"id":"b89e17af-5ceb-4e63-a2e3-2982c3a3ee82","block_type":"box","text":"prepayment scenarios, a Fund may fail to recoup fully its investment in mortgage-backed securities notwithstanding","page_number":82,"box":{"x":70,"y":690,"width":822,"height":11}},{"id":"679b9ad7-9d47-40b9-bfc7-e42de4c0c15f","block_type":"box","text":"any direct or indirect governmental or agency guarantee.","page_number":82,"box":{"x":69,"y":705,"width":399,"height":11}},{"id":"13e2f2cb-1f08-469f-b9a0-40815805b0d4","block_type":"box","text":"There are currently three types of mortgage pass-through securities: (1) those issued by the U.S. Government or","page_number":82,"box":{"x":101,"y":727,"width":802,"height":12}},{"id":"a4e2711e-b907-4d88-a97e-3f20f879fe24","block_type":"box","text":"one of its agencies or instrumentalities, such as the Government National Mortgage Association (“Ginnie Mae”), the","page_number":82,"box":{"x":69,"y":743,"width":830,"height":11}},{"id":"e4e70b3d-63a4-4103-85ca-08ff10dea74c","block_type":"box","text":"Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie","page_number":82,"box":{"x":70,"y":758,"width":818,"height":11}},{"id":"9e10fd1d-6ec7-4be6-b33c-6ed5a02cf8c3","block_type":"box","text":"Mac”); (2) those issued by private issuers that represent an interest in or are collateralized by pass-through","page_number":82,"box":{"x":70,"y":773,"width":766,"height":11}},{"id":"26af5270-3d0f-4610-845c-7b2e1fd1e413","block_type":"box","text":"securities issued or guaranteed by the U.S. Government or one of its agencies or instrumentalities; and (3) those","page_number":82,"box":{"x":69,"y":788,"width":808,"height":11}},{"id":"07af7348-c98e-41c8-892c-b10b7607180a","block_type":"box","text":"issued by private issuers that represent an interest in or are collateralized by whole mortgage loans or pass-through","page_number":82,"box":{"x":70,"y":803,"width":825,"height":11}},{"id":"881545a5-b68e-4129-a549-30b84c8c24bb","block_type":"box","text":"securities without a government guarantee but that usually have some form of private credit enhancement.","page_number":82,"box":{"x":69,"y":818,"width":761,"height":11}},{"id":"5a26b711-2fb8-4137-97cb-7b93ad61d916","block_type":"box","text":"Ginnie Mae is a wholly owned U.S. Government corporation within the Department of Housing and Urban","page_number":82,"box":{"x":102,"y":841,"width":743,"height":11}},{"id":"50f0fed5-5e96-4e66-888c-228043bdda4e","block_type":"box","text":"Development. Ginnie Mae is authorized to guarantee, with the full faith and credit of the U.S. Government, the timely","page_number":82,"box":{"x":70,"y":856,"width":831,"height":11}},{"id":"5ff6f6b4-4c60-48e3-93bb-60545c5df676","block_type":"box","text":"payment of principal and interest on securities issued by the institutions approved by Ginnie Mae (such as savings","page_number":82,"box":{"x":70,"y":871,"width":815,"height":11}},{"id":"ce85da1c-79de-4044-a0c5-51fda83fb59b","block_type":"box","text":"and loan institutions, commercial banks and mortgage banks), and backed by pools of Federal Housing","page_number":82,"box":{"x":69,"y":886,"width":737,"height":12}},{"id":"bd76df01-5e66-4170-a0e9-582e5a5de310","block_type":"box","text":"Administration (“FHA”)-insured or Veterans’ Administration (“VA”)-guaranteed mortgages. Pass-through certificates","page_number":82,"box":{"x":68,"y":901,"width":814,"height":12}},{"id":"aaa71213-c90d-4e16-a8ad-ca0a2ebbad58","block_type":"box","text":"II-51","page_number":82,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"029f63b7-b84c-4086-aeba-cf29515fad4d","block_type":"box","text":"NM0926U-5977317-82/232","page_number":82,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"9d4914ef-2071-415c-8f1e-7c5a7abf1e2e","block_type":"box","text":"guaranteed by Ginnie Mae (such certificates are also known as “Ginnie Maes”) are guaranteed as to the timely","page_number":83,"box":{"x":68,"y":45,"width":794,"height":11}},{"id":"9a933bb3-aa42-4709-9f51-0f1c780c6bd5","block_type":"box","text":"payment of principal and interest by Ginnie Mae, whose guarantee is backed by the full faith and credit of the United","page_number":83,"box":{"x":70,"y":60,"width":828,"height":11}},{"id":"b22a7919-4ae6-4786-b4db-0618b8af0d09","block_type":"box","text":"States. Ginnie Mae certificates also are supported by the authority of Ginnie Mae to borrow funds from the U.S.","page_number":83,"box":{"x":69,"y":75,"width":798,"height":11}},{"id":"4ec02745-2764-4271-9efe-f6f7d5647306","block_type":"box","text":"Treasury Department to make payments under its guarantee. Mortgage-related securities issued by Fannie Mae","page_number":83,"box":{"x":68,"y":90,"width":798,"height":11}},{"id":"8b0d78a1-b480-4f0a-9926-29a1a50a81d4","block_type":"box","text":"include Fannie Mae guaranteed Mortgage Pass-Through Certificates (also known as “Fannie Maes”), which are","page_number":83,"box":{"x":70,"y":105,"width":788,"height":11}},{"id":"7f5c9c44-f45b-4da3-8661-ee052fadf20f","block_type":"box","text":"guaranteed as to timely payment of principal and interest by Fannie Mae. They are not backed by or entitled to the full","page_number":83,"box":{"x":68,"y":120,"width":840,"height":12}},{"id":"bbeeac72-ff00-4b06-9c65-2f72b61f5fe2","block_type":"box","text":"faith and credit of the United States, but are supported by the right of Fannie Mae to borrow from the U.S. Treasury","page_number":83,"box":{"x":68,"y":135,"width":825,"height":12}},{"id":"d599fa9c-1e03-4b74-829b-f236adaad338","block_type":"box","text":"Department. Fannie Mae was established as a federal agency in 1938 and in 1968 was chartered by Congress as a","page_number":83,"box":{"x":70,"y":150,"width":830,"height":12}},{"id":"6afaccf4-9a1f-48dc-93d1-29ad2b186565","block_type":"box","text":"private shareholder-owned company. Mortgage-related securities issued by Freddie Mac include Freddie Mac","page_number":83,"box":{"x":70,"y":166,"width":770,"height":11}},{"id":"811864f1-3cac-42e7-a25d-e9defda2f0b6","block_type":"box","text":"Mortgage Participation Certificates (also known as “Freddie Macs” or “PCs”). Freddie Mac is a stockholder-owned","page_number":83,"box":{"x":70,"y":181,"width":812,"height":11}},{"id":"5d476e60-f53b-4ddd-9bc0-8cd8aeddd789","block_type":"box","text":"corporation chartered by Congress in 1970. Freddie Macs are not guaranteed by the United States or by any Federal","page_number":83,"box":{"x":69,"y":196,"width":829,"height":11}},{"id":"9fe1195a-cb38-4d9d-8bf2-bc90f9c67d5b","block_type":"box","text":"Home Loan Banks and do not constitute a debt or obligation of the United States or of any Federal Home Loan Bank.","page_number":83,"box":{"x":70,"y":211,"width":832,"height":11}},{"id":"3cf5d0bf-2405-4cc9-a579-584a2fb9b765","block_type":"box","text":"Freddie Macs entitle the holder to timely payment of interest, which is guaranteed by Freddie Mac. Freddie Mac","page_number":83,"box":{"x":70,"y":226,"width":792,"height":11}},{"id":"6f69b420-6e8f-4b02-a269-121240ee128d","block_type":"box","text":"guarantees either ultimate collection or timely payment of all principal payments on the underlying mortgage loans.","page_number":83,"box":{"x":68,"y":241,"width":819,"height":11}},{"id":"3bdef2b6-d23b-42d9-a745-a912c3d4d7ad","block_type":"box","text":"While Freddie Mac generally does not guarantee timely payment of principal, Freddie Mac may remit the amount due","page_number":83,"box":{"x":68,"y":256,"width":829,"height":12}},{"id":"c8ff6778-f32e-46dd-8f70-1e25d8b76624","block_type":"box","text":"on account of its guarantee of ultimate payment of principal at any time after default on an underlying mortgage, but","page_number":83,"box":{"x":69,"y":271,"width":829,"height":12}},{"id":"98d25617-4783-4c4b-8931-474f12769d18","block_type":"box","text":"in no event later than one year after it becomes payable.","page_number":83,"box":{"x":70,"y":286,"width":401,"height":12}},{"id":"cb19411e-47ba-4186-a34f-282c966a7872","block_type":"box","text":"Private mortgage pass-through securities are structured similarly to Ginnie Mae, Fannie Mae, and Freddie Mac","page_number":83,"box":{"x":102,"y":309,"width":786,"height":11}},{"id":"48b08e69-4f06-4937-b164-811d12a27082","block_type":"box","text":"mortgage pass-through securities and are issued by originators of and investors in mortgage loans, including","page_number":83,"box":{"x":69,"y":324,"width":777,"height":12}},{"id":"73629c90-2f6e-4133-bf73-128c04172d66","block_type":"box","text":"depository institutions, mortgage banks, investment banks and special purpose subsidiaries of the foregoing.","page_number":83,"box":{"x":69,"y":339,"width":782,"height":12}},{"id":"91b9bad9-8db7-4775-a57a-8244fd92f010","block_type":"box","text":"Pools created by private mortgage pass-through issuers generally offer a higher rate of interest than government","page_number":83,"box":{"x":102,"y":362,"width":802,"height":11}},{"id":"57440e72-0bab-4969-bf6a-5cea21366285","block_type":"box","text":"and government-related pools because there are no direct or indirect government or agency guarantees of payments","page_number":83,"box":{"x":69,"y":377,"width":828,"height":12}},{"id":"dddd6e8f-02ff-4e66-bb3c-da52dcf04917","block_type":"box","text":"in the private pools. However, timely payment of interest and principal of these pools may be supported by various","page_number":83,"box":{"x":70,"y":392,"width":814,"height":12}},{"id":"f4d0d4d1-8ed6-4654-abdc-fa6fc731ec25","block_type":"box","text":"forms of insurance or guarantees, including individual loan, title, pool and hazard insurance and letters of credit. The","page_number":83,"box":{"x":68,"y":407,"width":833,"height":12}},{"id":"5be45159-0e54-4f89-9789-a2dbc01da267","block_type":"box","text":"insurance and guarantees are issued by governmental entities, private insurers and the mortgage poolers. The","page_number":83,"box":{"x":70,"y":423,"width":789,"height":11}},{"id":"16e82af1-aef5-47a8-bfe3-cc9eac4fc440","block_type":"box","text":"insurance and guarantees and the creditworthiness of the issuers thereof will be considered in determining whether","page_number":83,"box":{"x":70,"y":438,"width":827,"height":11}},{"id":"fdf71ca2-7568-4199-ac0d-f8c805a5e240","block_type":"box","text":"a mortgage-related security meets a Fund’s investment quality standards. There can be no assurance that the private","page_number":83,"box":{"x":69,"y":453,"width":838,"height":11}},{"id":"87f8ee81-b3bf-421c-98e7-975ad4621c08","block_type":"box","text":"insurers or guarantors can meet their obligations under the insurance policies or guarantee arrangements. Private","page_number":83,"box":{"x":70,"y":468,"width":810,"height":11}},{"id":"d848f062-e91a-49d6-83de-92bd84d6b25e","block_type":"box","text":"mortgage pass-through securities may be bought without insurance or guarantees if, through an examination of the","page_number":83,"box":{"x":69,"y":483,"width":820,"height":11}},{"id":"e57661a7-5e6c-462e-9a53-5b34387eca99","block_type":"box","text":"loan experience and practices of the originator/servicers and poolers, the Manager determines that the securities","page_number":83,"box":{"x":70,"y":498,"width":812,"height":11}},{"id":"005996e3-e231-4dbe-86d1-25d0695329a6","block_type":"box","text":"meet a Fund’s quality standards. Any mortgage-related securities that are issued by private issuers have some","page_number":83,"box":{"x":69,"y":514,"width":790,"height":11}},{"id":"d66e8135-360c-4da3-802e-2d64b33d3f0e","block_type":"box","text":"exposure to subprime loans as well as to the mortgage and credit markets generally.","page_number":83,"box":{"x":69,"y":529,"width":604,"height":11}},{"id":"872778c2-495c-4573-90b9-c6b98316eceb","block_type":"box","text":"In addition, mortgage-related securities that are issued by private issuers are not subject to the underwriting","page_number":83,"box":{"x":102,"y":551,"width":774,"height":11}},{"id":"8dfdc412-a8d5-4452-be5d-f1b1f689bb43","block_type":"box","text":"requirements for the underlying mortgages that are applicable to those mortgage-related securities that have a","page_number":83,"box":{"x":69,"y":566,"width":791,"height":11}},{"id":"7a1b877d-eb94-463b-a34d-6cf07cf91b5b","block_type":"box","text":"government or government-sponsored entity guarantee. As a result, the mortgage loans underlying private mortgage","page_number":83,"box":{"x":68,"y":582,"width":832,"height":11}},{"id":"0d8c288a-6b86-4970-ad98-6148f27624c8","block_type":"box","text":"related securities may, and frequently do, have less favorable collateral, credit risk or other underwriting","page_number":83,"box":{"x":69,"y":596,"width":742,"height":12}},{"id":"10cc6cb2-edc5-4dbe-9333-0ce1eb74fbf5","block_type":"box","text":"characteristics than government or government-sponsored mortgage-related securities and have wider variances in a","page_number":83,"box":{"x":69,"y":612,"width":831,"height":11}},{"id":"aa6260c6-a6c4-477a-a6bc-56635e4c042b","block_type":"box","text":"number of terms including interest rate, term, size, purpose and borrower characteristics. Privately issued pools more","page_number":83,"box":{"x":69,"y":627,"width":840,"height":11}},{"id":"3e07de6f-e157-4434-b26b-303e77f6c8ac","block_type":"box","text":"frequently include second mortgages, high loan-to-value mortgages and manufactured housing loans. The coupon","page_number":83,"box":{"x":68,"y":642,"width":809,"height":11}},{"id":"03baeeae-5fa3-4aa4-9bca-c8e4bc62a7f9","block_type":"box","text":"rates and maturities of the underlying mortgage loans in a private-label mortgage-related securities pool may vary to","page_number":83,"box":{"x":69,"y":657,"width":828,"height":11}},{"id":"20b8b3a3-14c9-4228-9485-eb9e359e81af","block_type":"box","text":"a greater extent than those included in a government guaranteed pool, and the pool may include subprime mortgage","page_number":83,"box":{"x":69,"y":672,"width":830,"height":11}},{"id":"147f21ca-85b1-4161-8951-d2f38ea9b755","block_type":"box","text":"loans. Subprime loans refer to loans made to borrowers with weakened credit histories or with a lower capacity to","page_number":83,"box":{"x":70,"y":687,"width":810,"height":11}},{"id":"67a95d33-02e3-410a-9428-84d6d8b5399c","block_type":"box","text":"make timely payments on their loans. For these reasons, the loans underlying these securities have had in many","page_number":83,"box":{"x":69,"y":703,"width":804,"height":11}},{"id":"9c89b045-f910-4e09-be47-028376fbb294","block_type":"box","text":"cases higher default rates than those loans that meet government underwriting requirements.","page_number":83,"box":{"x":69,"y":717,"width":669,"height":12}},{"id":"00dc909d-8428-4b4c-b209-9afc5d3ef387","block_type":"box","text":"The risk of non-payment is greater for mortgage-related securities that are backed by mortgage pools that","page_number":83,"box":{"x":101,"y":740,"width":754,"height":11}},{"id":"b8975ff3-fce0-4b3d-8ea5-3a70881e6c88","block_type":"box","text":"contain subprime loans, but a level of risk exists for all loans. Market factors adversely affecting mortgage loan","page_number":83,"box":{"x":69,"y":755,"width":795,"height":11}},{"id":"4dffa065-f0ab-4676-99d4-b6af7286bc73","block_type":"box","text":"repayments may include a general economic turndown, high unemployment, a general slowdown in the real estate","page_number":83,"box":{"x":69,"y":771,"width":812,"height":11}},{"id":"b2efdeee-ea99-4a4f-ae48-11597159a902","block_type":"box","text":"market, a drop in the market prices of real estate, or an increase in interest rates resulting in higher mortgage","page_number":83,"box":{"x":69,"y":785,"width":788,"height":12}},{"id":"c113b074-d5f4-44f5-9ad9-b7bdc1d0a972","block_type":"box","text":"payments by holders of adjustable rate mortgages.","page_number":83,"box":{"x":70,"y":801,"width":361,"height":11}},{"id":"4828c922-d86a-42fa-9c13-1f221bc9a78b","block_type":"box","text":"Privately issued mortgage-related securities are not traded on an exchange and there may be a limited market","page_number":83,"box":{"x":102,"y":823,"width":784,"height":12}},{"id":"3f94a9d5-d419-4f7b-b24d-354744e78d56","block_type":"box","text":"for the securities, especially when there is a perceived weakness in the mortgage and real estate market sectors.","page_number":83,"box":{"x":68,"y":838,"width":813,"height":12}},{"id":"1bddedf7-992e-416c-8f25-bd4d14a257f2","block_type":"box","text":"Without an active trading market, mortgage-related securities held in a Fund’s portfolio may be particularly difficult to","page_number":83,"box":{"x":68,"y":853,"width":837,"height":12}},{"id":"c4570a70-193a-495b-a647-2c9a31c02532","block_type":"box","text":"value because of the complexities involved in assessing the value of the underlying mortgage loans.","page_number":83,"box":{"x":68,"y":869,"width":714,"height":11}},{"id":"d43dca9e-d1d5-4c33-a47d-d84de78ad00a","block_type":"box","text":"Collateralized Mor tgage Obligations (“CMOs”).","page_number":83,"box":{"x":102,"y":891,"width":328,"height":12}},{"id":"c3c56059-51e9-46d6-9aa1-0c75d161983a","block_type":"box","text":"CMOs are debt obligations collateralized by residential or","page_number":83,"box":{"x":437,"y":891,"width":407,"height":12}},{"id":"a1ad3bc6-a65d-4d11-b02a-978fe27db651","block_type":"box","text":"commercial mortgage loans or residential or commercial mortgage pass-through securities. Interest and prepaid","page_number":83,"box":{"x":69,"y":907,"width":800,"height":11}},{"id":"5853b8be-f810-4b34-aa16-276c94f1d610","block_type":"box","text":"II-52","page_number":83,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"5548e421-a4e2-44e1-a8b1-4c058c8681f9","block_type":"box","text":"NM0926U-5977317-83/232","page_number":83,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"fa5213d9-587d-469b-b2be-6e7b673e72ee","block_type":"box","text":"principal are generally paid monthly. CMOs may be collateralized by whole mortgage loans or private mortgage pass","page_number":84,"box":{"x":70,"y":45,"width":827,"height":11}},{"id":"f4bd9521-5bdf-44ef-8fbb-b0668e61649e","block_type":"box","text":"through securities but are more typically collateralized by portfolios of mortgage pass-through securities guaranteed","page_number":84,"box":{"x":68,"y":60,"width":826,"height":11}},{"id":"6f6d5a44-704f-4b14-8fd0-c9fdb3a2aa14","block_type":"box","text":"by Ginnie Mae, Freddie Mac, or Fannie Mae. The issuer of a series of CMOs may elect to be treated as a Real Estate","page_number":84,"box":{"x":69,"y":75,"width":833,"height":11}},{"id":"3e89e711-0641-49d5-af2a-f40f173cc6c8","block_type":"box","text":"Mortgage Investment Conduit (“REMIC”). All future references to CMOs also include REMICs.","page_number":84,"box":{"x":70,"y":90,"width":661,"height":11}},{"id":"af271884-2056-4e27-b135-907c9473bd63","block_type":"box","text":"CMOs are structured into multiple classes, often referred to as a “tranche,” each issued at a specific adjustable","page_number":84,"box":{"x":102,"y":113,"width":803,"height":11}},{"id":"acba84d1-0788-4803-b98b-45f13a7f6ed8","block_type":"box","text":"or fixed interest rate, and bearing a different stated maturity date and each must be fully retired no later than its final","page_number":84,"box":{"x":69,"y":128,"width":837,"height":11}},{"id":"df2bcfd2-0873-4c5a-bb33-9ba84392c074","block_type":"box","text":"distribution date. Actual maturity and average life will depend upon the prepayment experience of the collateral, which","page_number":84,"box":{"x":69,"y":143,"width":838,"height":11}},{"id":"a390d1c1-fd58-4e4f-bb65-6ee8a9cbdc5f","block_type":"box","text":"is ordinarily unrelated to the stated maturity date. CMOs often provide for a modified form of call protection through a","page_number":84,"box":{"x":70,"y":158,"width":836,"height":11}},{"id":"523b9e67-1a5a-4693-bd01-97e31ac3cdac","block_type":"box","text":"de facto breakdown of the underlying pool of mortgages according to how quickly the loans are repaid. Monthly","page_number":84,"box":{"x":69,"y":173,"width":791,"height":11}},{"id":"6e6ba970-c8ab-4703-bf63-989fd0f4d3fe","block_type":"box","text":"payment of principal received from the pool of underlying mortgages, including prepayments, is first returned to","page_number":84,"box":{"x":70,"y":188,"width":792,"height":12}},{"id":"ed8afc90-f372-4d97-9551-8f12ea6a30ab","block_type":"box","text":"investors holding the shortest maturity class. Investors holding the longer maturity classes usually receive principal","page_number":84,"box":{"x":70,"y":204,"width":820,"height":11}},{"id":"a927af0e-cfe5-4b14-8e54-bad1d14fdbf0","block_type":"box","text":"only after the first class has been retired. An investor may be partially protected against a sooner than desired return","page_number":84,"box":{"x":69,"y":218,"width":836,"height":12}},{"id":"a72b7308-34e3-46dc-b7f1-06234495c889","block_type":"box","text":"of principal because of the sequential payments.","page_number":84,"box":{"x":69,"y":234,"width":346,"height":11}},{"id":"c524a0c5-4af9-46e0-a1a3-e5bfcaf1c3dc","block_type":"box","text":"Certain issuers of CMOs are not considered investment companies pursuant to a rule adopted by the","page_number":84,"box":{"x":102,"y":256,"width":723,"height":11}},{"id":"f18c864e-0b79-4300-bd03-1adc77cdf23d","block_type":"box","text":"Commission, and a Fund may invest in the securities of such issuers without the limitations imposed by the","page_number":84,"box":{"x":69,"y":271,"width":768,"height":12}},{"id":"087ce5b8-b427-4d17-ab69-95fa88db3d16","block_type":"box","text":"Investment Company Act on investments by a Fund in other investment companies. In addition, in reliance on an","page_number":84,"box":{"x":70,"y":287,"width":800,"height":11}},{"id":"131b62c8-0761-40bd-92b6-630d187511ea","block_type":"box","text":"earlier Commission interpretation, a Fund’s investments in certain other qualifying CMOs, which cannot or do not rely","page_number":84,"box":{"x":69,"y":302,"width":836,"height":11}},{"id":"f3f4f02b-18d4-4629-9179-8ab7050e067a","block_type":"box","text":"on the rule, are also not subject to the limitation of the Investment Company Act on acquiring interests in other","page_number":84,"box":{"x":69,"y":317,"width":793,"height":11}},{"id":"d7f33abe-7121-4b00-ad9b-987353c573fa","block_type":"box","text":"investment companies. In order to be able to rely on the Commission’s interpretation, these CMOs must be","page_number":84,"box":{"x":70,"y":332,"width":767,"height":11}},{"id":"d0f3276b-4e59-4f6e-99d2-72c801153436","block_type":"box","text":"unmanaged, fixed asset issuers, that: (1) invest primarily in mortgage-backed securities; (2) do not issue redeemable","page_number":84,"box":{"x":69,"y":347,"width":838,"height":11}},{"id":"64e975b3-9003-4122-a7db-50bdf46a146e","block_type":"box","text":"securities; (3) operate under general exemptive orders exempting them from all provisions of the Investment","page_number":84,"box":{"x":69,"y":362,"width":773,"height":11}},{"id":"80901c69-e41b-41db-81eb-b2641fa43a65","block_type":"box","text":"Company Act; and (4) are not registered or regulated under the Investment Company Act as investment companies.","page_number":84,"box":{"x":69,"y":377,"width":821,"height":12}},{"id":"f8921be8-bde5-43b7-a9de-5e05d182d8a1","block_type":"box","text":"To the extent that a Fund selects CMOs that cannot rely on the rule or do not meet the above requirements, the Fund","page_number":84,"box":{"x":68,"y":392,"width":836,"height":12}},{"id":"482a64d5-92db-45b0-a483-0cbe4c2b8fa0","block_type":"box","text":"may not invest more than 10% of its assets in all such entities and may not acquire more than 3% of the voting","page_number":84,"box":{"x":69,"y":407,"width":795,"height":12}},{"id":"9f51d1c6-2043-4ee9-8733-3414ae539ff6","block_type":"box","text":"securities of any single such entity.","page_number":84,"box":{"x":69,"y":423,"width":248,"height":11}},{"id":"111a6ac9-5a6f-4b34-b47e-b59ff659b63f","block_type":"box","text":"A Fund may also invest in, among other things, parallel pay CMOs, sequential pay CMOs, and floating rate CMOs.","page_number":84,"box":{"x":101,"y":445,"width":807,"height":12}},{"id":"770f5448-ef63-4f78-ae5d-56a99ddb9a7d","block_type":"box","text":"Parallel pay CMOs are structured to provide payments of principal on each payment date to more than one class,","page_number":84,"box":{"x":69,"y":460,"width":805,"height":12}},{"id":"cb7117bd-7b78-46f7-ad42-e49530a79102","block_type":"box","text":"concurrently on a proportionate or disproportionate basis. These simultaneous payments are taken into account in","page_number":84,"box":{"x":69,"y":476,"width":819,"height":11}},{"id":"f91073a9-9478-4b31-bfca-f0746c0fa45a","block_type":"box","text":"calculating the final distribution date of each class. Sequential pay CMOs generally pay principal to only one class at","page_number":84,"box":{"x":69,"y":491,"width":829,"height":11}},{"id":"50937926-9044-4056-9303-76fcdb8b9828","block_type":"box","text":"a time while paying interest to several classes. A wide variety of REMIC Certificates may be issued in the parallel pay","page_number":84,"box":{"x":69,"y":506,"width":835,"height":11}},{"id":"849f4b2d-0ea0-4dc2-93d4-a5d77997b3e2","block_type":"box","text":"or sequential pay structures. These securities include accrual certificates (also known as “Z-Bonds”), which only","page_number":84,"box":{"x":69,"y":521,"width":802,"height":11}},{"id":"f5aae103-b662-4df9-afed-c8336381c329","block_type":"box","text":"accrue interest at a specified rate until all other certificates having an earlier final distribution date have been retired","page_number":84,"box":{"x":69,"y":536,"width":833,"height":11}},{"id":"9f1f8219-cd9f-4c1a-a45a-ebf8de615c74","block_type":"box","text":"and are converted thereafter to an interest-paying security. Floating rate CMOs are securities whose coupon rate","page_number":84,"box":{"x":69,"y":551,"width":801,"height":11}},{"id":"536e5b67-dec9-40c5-acb6-66d271d53c0e","block_type":"box","text":"fluctuates according to some formula related to an existing market index or rate. Typical indices would include the","page_number":84,"box":{"x":68,"y":566,"width":813,"height":11}},{"id":"7effef67-9d3a-45a9-baa4-e909d82921bc","block_type":"box","text":"eleventh district cost-of-funds index (“COFI”), one-year Treasury yields, and ten-year Treasury yields.","page_number":84,"box":{"x":69,"y":581,"width":708,"height":11}},{"id":"bc41db59-3d28-4f8a-aa70-8a5c4f770301","block_type":"box","text":"Classes of CMOs also include planned amortization classes (“PACs”) and targeted amortization classes","page_number":84,"box":{"x":102,"y":604,"width":742,"height":11}},{"id":"eb573d94-ce8d-4af7-8f76-389baa165298","block_type":"box","text":"(“TACs”). PAC bonds generally require payments of a specified amount of principal on each payment date. The","page_number":84,"box":{"x":69,"y":619,"width":784,"height":11}},{"id":"09afc58b-eb48-41ba-ac11-7b2617a4cbb8","block_type":"box","text":"scheduled principal payments for PAC Certificates generally have the highest priority on each payment date after","page_number":84,"box":{"x":69,"y":634,"width":800,"height":12}},{"id":"a8e1afbc-cd29-4a9b-9c9b-801081dfb3fe","block_type":"box","text":"interest due has been paid to all classes entitled to receive interest currently. Shortfalls, if any, are added to the","page_number":84,"box":{"x":70,"y":649,"width":802,"height":12}},{"id":"2960e287-d0ac-4114-b2fd-a6ead603be71","block_type":"box","text":"amount payable on the next payment date. The PAC Certificate payment schedule is taken into account in calculating","page_number":84,"box":{"x":69,"y":664,"width":834,"height":12}},{"id":"2929403a-8095-4d65-968b-4e3d1db7a75b","block_type":"box","text":"the final distribution date of each class of PAC. In order to create PAC tranches, one or more tranches generally must","page_number":84,"box":{"x":68,"y":680,"width":835,"height":11}},{"id":"413e8951-f09a-417c-b471-c708ed4f785e","block_type":"box","text":"be created that absorb most of the volatility in the underlying mortgage assets. These tranches (often called","page_number":84,"box":{"x":69,"y":695,"width":772,"height":11}},{"id":"dae48ada-a01e-4d4d-9218-b57133a31883","block_type":"box","text":"“supports” or “companion” tranches) tend to have market prices and yields that are more volatile than the PAC","page_number":84,"box":{"x":70,"y":710,"width":792,"height":11}},{"id":"4d347133-ade6-43cb-b836-b0cdb2c7ebdf","block_type":"box","text":"classes.","page_number":84,"box":{"x":69,"y":725,"width":57,"height":9}},{"id":"8ff1f8da-7b4f-4b4f-8fef-eaed61a7d40c","block_type":"box","text":"TACs are similar to PACs in that they require that specified amounts of principal be applied on each payment","page_number":84,"box":{"x":101,"y":748,"width":774,"height":11}},{"id":"dbaf91a6-a50e-467f-845e-c72f704488e2","block_type":"box","text":"date to one or more classes of REMIC Certificates. A PAC’s payment schedule, however, remains in effect as long as","page_number":84,"box":{"x":69,"y":763,"width":835,"height":11}},{"id":"b1494ca1-f758-49a1-ba03-613085318119","block_type":"box","text":"prepayment rates on the underlying mortgages do not exceed certain ranges. In contrast, a TAC provides investors","page_number":84,"box":{"x":70,"y":778,"width":815,"height":11}},{"id":"ccaba22c-c117-4c07-81de-344feff46ae6","block_type":"box","text":"with protection, to a certain level, against either faster than expected or slower than expected prepayment rates, but","page_number":84,"box":{"x":68,"y":793,"width":833,"height":11}},{"id":"5cf25e61-11f0-4de5-801a-e1bb234dfb82","block_type":"box","text":"not both. TACs thus provide more cash flow stability than a regular sequential paying class, but less than a PAC. TACs","page_number":84,"box":{"x":69,"y":808,"width":839,"height":11}},{"id":"39faad04-da46-41a5-8e27-3d7f7f089883","block_type":"box","text":"also tend to have market prices and yields that are more volatile than PACs.","page_number":84,"box":{"x":69,"y":823,"width":541,"height":11}},{"id":"a560101d-a901-4738-88af-641517183763","block_type":"box","text":"Adjustable Rate Mor tgage Securities.","page_number":84,"box":{"x":101,"y":846,"width":265,"height":11}},{"id":"5f20e183-7282-40e5-948c-88e268e31d81","block_type":"box","text":"Adjustable rate mortgage securities (“ARMs”) are pass-through securities","page_number":84,"box":{"x":372,"y":846,"width":523,"height":11}},{"id":"535cf844-f41e-4292-aa24-f8909401a5c5","block_type":"box","text":"collateralized by mortgages with adjustable rather than fixed rates. ARMs eligible for inclusion in a mortgage pool","page_number":84,"box":{"x":69,"y":861,"width":807,"height":11}},{"id":"f44cd753-249e-4fba-a6e5-5658264a4be0","block_type":"box","text":"generally provide for a fixed initial mortgage interest rate for a set number of scheduled monthly payments. After that","page_number":84,"box":{"x":68,"y":876,"width":835,"height":11}},{"id":"978f0292-9fe2-4cd7-9ca0-503ec7de3955","block_type":"box","text":"schedule of payments has been completed, the interest rates are subject to periodic adjustment based on changes","page_number":84,"box":{"x":69,"y":891,"width":824,"height":12}},{"id":"6b2dd517-7f89-4617-95f2-180b2d489640","block_type":"box","text":"to a designated benchmark index.","page_number":84,"box":{"x":68,"y":907,"width":241,"height":11}},{"id":"70837b20-fd02-49af-bd13-659de0f56d94","block_type":"box","text":"II-53","page_number":84,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"1ed30c44-6e27-4062-b22a-6cd8a27f7f50","block_type":"box","text":"NM0926U-5977317-84/232","page_number":84,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"d62bf16b-d675-4cab-917c-90e3db21ef41","block_type":"box","text":"ARMs contain maximum and minimum rates beyond which the mortgage interest rate may not vary over the","page_number":85,"box":{"x":101,"y":45,"width":767,"height":11}},{"id":"ea96dfdf-e626-41ff-9fe7-6552fd51fd1a","block_type":"box","text":"lifetime of the security. In addition, certain ARMs provide for additional limitations on the maximum amount by which","page_number":85,"box":{"x":70,"y":60,"width":828,"height":11}},{"id":"2129dc66-37fb-4422-9882-3c40ac71c52a","block_type":"box","text":"the mortgage interest rate may adjust for any single adjustment period. In the event that market rates of interest rise","page_number":85,"box":{"x":68,"y":75,"width":837,"height":11}},{"id":"53259b3b-28fb-448a-a107-af5013906d21","block_type":"box","text":"more rapidly to levels above that of the ARM’s maximum rate, the ARM’s coupon may represent a below market rate","page_number":85,"box":{"x":69,"y":90,"width":830,"height":11}},{"id":"4377b0ec-4e49-4461-91a9-00b5095045ab","block_type":"box","text":"of interest. In these circumstances, the market value of the ARM security will likely have fallen.","page_number":85,"box":{"x":69,"y":105,"width":676,"height":11}},{"id":"d9279bf2-a3ce-4f89-896a-0942361c3b0d","block_type":"box","text":"Certain ARMs contain limitations on changes in the required monthly payment. In the event that a monthly","page_number":85,"box":{"x":102,"y":128,"width":757,"height":11}},{"id":"00ecd267-ff22-4d69-b02e-9b34c5893966","block_type":"box","text":"payment is not sufficient to pay the interest accruing on an ARM, any such excess interest is added to the principal","page_number":85,"box":{"x":70,"y":143,"width":822,"height":11}},{"id":"60b13638-d64f-4031-9cad-efdf5cb8adee","block_type":"box","text":"balance of the mortgage loan, which is repaid through future monthly payments. If the monthly payment for such an","page_number":85,"box":{"x":69,"y":158,"width":823,"height":11}},{"id":"a19b2146-b6d4-46a5-9ead-ce8b70ed0de0","block_type":"box","text":"instrument exceeds the sum of the interest accrued at the applicable mortgage interest rate and the principal","page_number":85,"box":{"x":70,"y":173,"width":782,"height":11}},{"id":"f1f1455b-d0cd-4952-b322-1fd4b9766a1b","block_type":"box","text":"payment required at such point to amortize the outstanding principal balance over the remaining term of the loan, the","page_number":85,"box":{"x":70,"y":188,"width":838,"height":12}},{"id":"2231bdc6-bb52-414f-9eb2-cd341c702c38","block_type":"box","text":"excess is then used to reduce the outstanding principal balance of the ARM.","page_number":85,"box":{"x":69,"y":203,"width":544,"height":12}},{"id":"9e0cafb2-a9b8-4829-939a-d2155d190496","block_type":"box","text":"CMO Residuals.","page_number":85,"box":{"x":102,"y":226,"width":112,"height":9}},{"id":"8a1a9ab1-865c-4721-b91a-ee3846bf37f8","block_type":"box","text":"CMO residuals are derivative mortgage securities issued by agencies or instrumentalities of the","page_number":85,"box":{"x":221,"y":226,"width":682,"height":11}},{"id":"c1e6e9f1-06a4-430e-a38f-bbc0b9e0d15a","block_type":"box","text":"U.S. Government or by private originators of, or investors in, mortgage loans, including savings and loan","page_number":85,"box":{"x":70,"y":241,"width":740,"height":11}},{"id":"f61b96d1-f89d-4007-a003-a695c6eb4c51","block_type":"box","text":"associations, homebuilders, mortgage banks, commercial banks, investment banks, and special purpose entities of","page_number":85,"box":{"x":69,"y":256,"width":829,"height":12}},{"id":"f095db0b-00e7-46f0-992f-fcfb64ac07f7","block_type":"box","text":"the foregoing. The cash flow generated by the mortgage assets underlying a series of CMOs is applied first to make","page_number":85,"box":{"x":68,"y":271,"width":826,"height":12}},{"id":"202d574a-ade0-41f1-ab31-f3735720c342","block_type":"box","text":"required payments of principal and interest on the CMOs and second to pay the related administrative expenses and","page_number":85,"box":{"x":69,"y":286,"width":831,"height":12}},{"id":"60ceff69-53b2-4b07-803d-c7fa23583d69","block_type":"box","text":"any management fees of the issuer. The residual in a CMO structure generally represents the interest in any excess","page_number":85,"box":{"x":69,"y":302,"width":827,"height":11}},{"id":"8c34c227-c74f-4c30-b5a1-385faf039c8f","block_type":"box","text":"cash flow remaining after making the foregoing payments. Each payment of such excess cash flow to a holder of the","page_number":85,"box":{"x":69,"y":317,"width":829,"height":11}},{"id":"039db4cc-8c64-401a-87bf-b47dde872ed1","block_type":"box","text":"related CMO residual represents income and/or a return of capital. The amount of residual cash flow resulting from a","page_number":85,"box":{"x":69,"y":332,"width":838,"height":11}},{"id":"7cb1917e-15d8-4a31-807b-53a7a7341c13","block_type":"box","text":"CMO will depend on, among other things, the characteristics of the mortgage assets, the coupon rate of each class","page_number":85,"box":{"x":69,"y":347,"width":825,"height":11}},{"id":"5b1c3679-b8a0-4ba8-b2df-206a904270de","block_type":"box","text":"of CMO, prevailing interest rates, the amount of administrative expenses and the prepayment experience on the","page_number":85,"box":{"x":69,"y":362,"width":798,"height":11}},{"id":"e020cdd8-1bc5-47bb-9f5b-262a29558d89","block_type":"box","text":"mortgage assets. In part, the yield to maturity on the CMO residuals is extremely sensitive to prepayments on the","page_number":85,"box":{"x":69,"y":377,"width":813,"height":12}},{"id":"99a09544-9025-4dbd-bdc3-1b8b5e79afc3","block_type":"box","text":"related underlying mortgage assets, in the same manner as an interest-only class of stripped mortgage-related","page_number":85,"box":{"x":69,"y":392,"width":790,"height":12}},{"id":"c9dd2b51-5783-4215-a6a7-47f6c362abc6","block_type":"box","text":"securities. In addition, if a series of a CMO includes a class that bears interest at an adjustable rate, the yield to","page_number":85,"box":{"x":69,"y":407,"width":805,"height":12}},{"id":"e35caadf-1b14-4022-8e2f-a549370be3fd","block_type":"box","text":"maturity on the related CMO residual will also be extremely sensitive to changes in the level of the index upon which","page_number":85,"box":{"x":69,"y":423,"width":828,"height":11}},{"id":"c0a86a0b-52b6-4fd5-b423-754c4f52ec0c","block_type":"box","text":"interest rate adjustments are based. In certain circumstances, a Fund may fail to recoup fully its initial investment in","page_number":85,"box":{"x":70,"y":438,"width":831,"height":11}},{"id":"6d0e89ca-31ed-491c-a223-c2be5ae929a4","block_type":"box","text":"a CMO residual.","page_number":85,"box":{"x":69,"y":453,"width":112,"height":9}},{"id":"5afc9c2b-aead-4699-9f7b-6aaff51ef10b","block_type":"box","text":"CMO residuals are generally purchased and sold by institutional investors through one or more investment","page_number":85,"box":{"x":102,"y":476,"width":758,"height":11}},{"id":"21597e51-f117-4b2f-892f-2b05a9e70532","block_type":"box","text":"banking firms acting as brokers or dealers. Transactions in CMO residuals are generally completed only after careful","page_number":85,"box":{"x":69,"y":491,"width":827,"height":11}},{"id":"c8a382fe-d0e6-4507-9bc4-e76dd5ee1fc6","block_type":"box","text":"review of the characteristics of the securities in question. In addition, CMO residuals may or, pursuant to an","page_number":85,"box":{"x":69,"y":506,"width":769,"height":11}},{"id":"494d6725-869c-463f-9c46-320d64704532","block_type":"box","text":"exemption therefrom, may not have been registered under the Securities Act. Residual interests generally are junior","page_number":85,"box":{"x":69,"y":521,"width":825,"height":11}},{"id":"425fca5a-6834-4dc0-8a6e-4bba917b3eda","block_type":"box","text":"to, and may be significantly more volatile than, “regular” CMO and REMIC interests. CMO residuals, whether or not","page_number":85,"box":{"x":68,"y":536,"width":820,"height":11}},{"id":"986648ed-6892-45c3-b199-92c8679790f6","block_type":"box","text":"registered under the Securities Act, may be subject to certain restrictions on transferability.","page_number":85,"box":{"x":69,"y":551,"width":650,"height":11}},{"id":"f65da7a3-9fde-426c-a37c-bd6094b76a4f","block_type":"box","text":"Stripped Mor tgage-Backed Securities.","page_number":85,"box":{"x":102,"y":574,"width":267,"height":11}},{"id":"1acab3ad-8a19-4fcd-a3b6-fc8b9de3a6e4","block_type":"box","text":"A Fund may invest in stripped mortgage-backed securities (“SMBSs”)","page_number":85,"box":{"x":375,"y":574,"width":493,"height":11}},{"id":"9a5f8bf6-ad51-4886-91e8-07c9b34ac528","block_type":"box","text":"issued by agencies or instrumentalities of the United States. SMBSs are derivative multi-class mortgage-backed","page_number":85,"box":{"x":70,"y":589,"width":798,"height":11}},{"id":"f2297d17-dfa6-4adf-9939-f3b97749511f","block_type":"box","text":"securities. SMBS arrangements commonly involve two classes of securities that receive different proportions of the","page_number":85,"box":{"x":69,"y":604,"width":826,"height":11}},{"id":"50fc5863-dc05-4709-ac93-d0a558825d5f","block_type":"box","text":"interest and principal distributions on a pool of mortgage assets. A common variety of SMBS is where one class (the","page_number":85,"box":{"x":70,"y":619,"width":832,"height":11}},{"id":"7cb5aea5-82dd-45a4-8c7c-111dd672ae96","block_type":"box","text":"principal only or PO class) receives some of the interest and most of the principal from the underlying assets, while","page_number":85,"box":{"x":70,"y":634,"width":821,"height":12}},{"id":"49b0ec65-1f9e-4217-b4ef-05208821f21a","block_type":"box","text":"the other class (the interest only or IO class) receives most of the interest and the remainder of the principal. In the","page_number":85,"box":{"x":68,"y":649,"width":826,"height":12}},{"id":"404ac873-a0a5-4d70-9a6a-b61d54f6432e","block_type":"box","text":"most extreme case, the IO class receives all of the interest, while the PO class receives all of the principal. While a","page_number":85,"box":{"x":69,"y":664,"width":822,"height":11}},{"id":"eb30e42f-12b4-4e82-a765-d5d24c97723a","block_type":"box","text":"Fund may purchase securities of a PO class, a Fund is more likely to purchase the securities of an IO class. The yield","page_number":85,"box":{"x":70,"y":680,"width":834,"height":11}},{"id":"9cfb399c-a582-495b-b31e-0f4216202aaa","block_type":"box","text":"to maturity of an IO class is extremely sensitive to the rate of principal payments (including prepayments) on the","page_number":85,"box":{"x":68,"y":695,"width":800,"height":11}},{"id":"405d19de-70ce-4726-9429-607058cd5bed","block_type":"box","text":"related underlying assets, and a rapid rate of principal prepayments in excess of that considered in pricing the","page_number":85,"box":{"x":69,"y":710,"width":786,"height":11}},{"id":"f2aafb3a-3223-43df-8082-83f8d5721ec5","block_type":"box","text":"securities will have a material adverse effect on an IO security’s yield to maturity. If the underlying mortgage assets","page_number":85,"box":{"x":69,"y":725,"width":823,"height":11}},{"id":"2741e5d4-652f-4704-9bfd-dfa6b059a508","block_type":"box","text":"experience greater than anticipated payments of principal, a Fund may fail to recoup fully its initial investment in IOs.","page_number":85,"box":{"x":69,"y":740,"width":832,"height":11}},{"id":"0221d81a-0397-4e9c-9efa-2508790728f4","block_type":"box","text":"In addition, there are certain types of IOs that represent the interest portion of a particular class as opposed to the","page_number":85,"box":{"x":70,"y":755,"width":824,"height":11}},{"id":"88ccbb77-5ded-4b0e-a857-ecb893d607d2","block_type":"box","text":"interest portion of the entire pool. The sensitivity of this type of IO to interest rate fluctuations may be increased","page_number":85,"box":{"x":70,"y":770,"width":800,"height":11}},{"id":"b5556cbf-004f-4cc1-b05a-e7a1b413019e","block_type":"box","text":"because of the characteristics of the principal portion to which they relate. As a result of the above factors, a Fund","page_number":85,"box":{"x":69,"y":785,"width":818,"height":12}},{"id":"1d47551b-22f9-4dd2-af3b-101db354588a","block_type":"box","text":"generally will purchase IOs only as a component of so called “synthetic” securities. This means that purchases of IOs","page_number":85,"box":{"x":68,"y":801,"width":840,"height":11}},{"id":"5371d233-0e8d-4efb-91e4-0d71e76c616f","block_type":"box","text":"will be matched with certain purchases of other securities, such as POs, inverse floating rate CMOs or fixed rate","page_number":85,"box":{"x":68,"y":816,"width":802,"height":11}},{"id":"1463485d-e320-4074-859e-bf0a1cd9eb07","block_type":"box","text":"securities; as interest rates fall, presenting a greater risk of unanticipated prepayments of principal, the negative","page_number":85,"box":{"x":69,"y":831,"width":805,"height":11}},{"id":"a247ec64-04ed-4329-877e-ef5a2e6b68eb","block_type":"box","text":"effect on a Fund because of its holdings of IOs should be diminished somewhat because of the increased yield on","page_number":85,"box":{"x":69,"y":846,"width":814,"height":11}},{"id":"773de6aa-4569-4fa8-a494-9633649be4b9","block_type":"box","text":"the inverse floating rate CMOs or the increased appreciation on the POs or fixed rate securities.","page_number":85,"box":{"x":68,"y":861,"width":683,"height":11}},{"id":"9bc66ff8-ab3b-43d4-a756-459dcc2b72ae","block_type":"box","text":"Tiered Index Bonds.","page_number":85,"box":{"x":103,"y":884,"width":138,"height":9}},{"id":"53796581-537a-4f00-9e91-1ec5dcde5b17","block_type":"box","text":"Tiered index bonds are forms of mortgage-related securities. The interest rate on a tiered","page_number":85,"box":{"x":247,"y":884,"width":638,"height":11}},{"id":"b2625142-fe19-4fff-9e60-331784335cfb","block_type":"box","text":"index bond is tied to a specified index or market rate. So long as this index or market rate is below a predetermined","page_number":85,"box":{"x":70,"y":899,"width":825,"height":11}},{"id":"d7ee7644-42fc-471e-9c50-acecb35daba6","block_type":"box","text":"II-54","page_number":85,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"2c8019b6-03e1-4559-b947-d77429ffc686","block_type":"box","text":"NM0926U-5977317-85/232","page_number":85,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"8d9242f1-80b3-4f47-90ff-4a8669170fdf","block_type":"box","text":"“strike” rate, the interest rate on the tiered index bond remains fixed. If, however, the specified index or market rate","page_number":86,"box":{"x":70,"y":45,"width":827,"height":11}},{"id":"7642ea95-5e1d-4fe8-aed6-b7642d9124db","block_type":"box","text":"rises above the “strike” rate, the interest rate of the tiered index bond will decrease. Thus, under these","page_number":86,"box":{"x":69,"y":60,"width":738,"height":10}},{"id":"462c714f-a73c-40ce-be9c-53bae228a388","block_type":"box","text":"circumstances, the interest rate on a tiered index bond, like an inverse floater, will move in the opposite direction of","page_number":86,"box":{"x":69,"y":75,"width":828,"height":11}},{"id":"e02b4786-5925-48f7-9ee8-f4ae716d2a84","block_type":"box","text":"prevailing interest rates, with the result that the price of the tiered index bond may be considerably more volatile than","page_number":86,"box":{"x":70,"y":90,"width":836,"height":11}},{"id":"d6e06ec2-d886-4a12-907e-bc87078d456e","block_type":"box","text":"that of a fixed-rate bond.","page_number":86,"box":{"x":68,"y":105,"width":174,"height":9}},{"id":"0a0d60fd-b5a8-4a31-a219-0bfd192f8c6a","block_type":"box","text":"TBA Commitments.","page_number":86,"box":{"x":103,"y":128,"width":133,"height":9}},{"id":"3c66f5bf-7482-4d33-bdc3-eb409e323e31","block_type":"box","text":"Certain Funds may enter into “to be announced” or “TBA” commitments. TBA commitments","page_number":86,"box":{"x":243,"y":128,"width":653,"height":11}},{"id":"6832d8de-d5b1-4b18-8ad1-a9caf29818ea","block_type":"box","text":"are forward agreements for the purchase or sale of securities, including mortgage-backed securities for a fixed price,","page_number":86,"box":{"x":69,"y":143,"width":834,"height":11}},{"id":"64df09a5-11d8-4c25-a695-efeb1d1090d7","block_type":"box","text":"with payment and delivery on an agreed upon future settlement date. The specific securities to be delivered are not","page_number":86,"box":{"x":68,"y":158,"width":825,"height":11}},{"id":"f6ae991e-df4e-47b5-ab45-c71c82dd1348","block_type":"box","text":"identified at the trade date. However, delivered securities must meet specified terms, including issuer, rate and","page_number":86,"box":{"x":70,"y":173,"width":793,"height":11}},{"id":"bb2102d4-c45c-4f94-845a-24d51c3807a1","block_type":"box","text":"mortgage terms. When the Fund enters into a TBA commitment for the sale of mortgage-backed securities for a fixed","page_number":86,"box":{"x":69,"y":188,"width":833,"height":12}},{"id":"867abe19-7a29-4274-8a61-9248bb020317","block_type":"box","text":"price, with payment and delivery on an agreed upon future settlement date (which may be referred to as having a","page_number":86,"box":{"x":70,"y":203,"width":804,"height":12}},{"id":"e001564a-fa08-4812-b4d6-500d9b50c2be","block_type":"box","text":"short position in such TBA securities), the Fund may or may not hold the types of mortgage-backed securities","page_number":86,"box":{"x":69,"y":218,"width":779,"height":12}},{"id":"4ec2ca16-c103-44cc-80a8-8f4118c6da88","block_type":"box","text":"required to be delivered. See “—When-Issued Securities, Delayed Delivery Securities and Forward Commitments”","page_number":86,"box":{"x":69,"y":234,"width":810,"height":11}},{"id":"5042b529-3ee0-4ac3-938d-80ec18a01f11","block_type":"box","text":"below.","page_number":86,"box":{"x":69,"y":249,"width":43,"height":9}},{"id":"8ed8e128-a8f0-4f88-a63a-4160762ed9fb","block_type":"box","text":"Mor tgage Dollar Rolls.","page_number":86,"box":{"x":102,"y":272,"width":157,"height":11}},{"id":"ff70cd72-b3c4-4286-b533-8e1498df31f1","block_type":"box","text":"Certain Funds may invest in mortgage dollar rolls. In a mortgage dollar roll transaction, a","page_number":86,"box":{"x":266,"y":272,"width":634,"height":11}},{"id":"8a4a30f6-d3ec-4e2c-b1d6-43635cf7365a","block_type":"box","text":"Fund sells mortgage-backed securities for delivery in the current month and simultaneously contracts to repurchase","page_number":86,"box":{"x":70,"y":286,"width":825,"height":12}},{"id":"44007424-4850-44f3-bffc-4886cd9c73fe","block_type":"box","text":"substantially similar securities on a specified future date. The securities that are repurchased will bear the same","page_number":86,"box":{"x":69,"y":302,"width":805,"height":11}},{"id":"8c669053-00ba-4744-bc31-779a0babd316","block_type":"box","text":"interest rate and a similar maturity as those sold, but pools of mortgages collateralizing those securities may have","page_number":86,"box":{"x":70,"y":317,"width":817,"height":11}},{"id":"daafe763-cf35-4705-8104-ead06df19943","block_type":"box","text":"different prepayment histories than those sold. During the period between the sale and repurchase, a Fund will not","page_number":86,"box":{"x":69,"y":332,"width":820,"height":11}},{"id":"1cce1e3e-dfaf-4718-be46-9be07666d96a","block_type":"box","text":"be entitled to receive interest and principal payments on the securities sold. Proceeds of the sale will be invested in","page_number":86,"box":{"x":69,"y":347,"width":827,"height":11}},{"id":"92476023-7899-40df-9adc-50e005bfb7eb","block_type":"box","text":"additional instruments for the Fund, and the income from these investments will generate income for the Fund. If","page_number":86,"box":{"x":69,"y":362,"width":806,"height":11}},{"id":"f39a1e1a-0206-45b6-bd7a-2e4e15c98e03","block_type":"box","text":"such income does not exceed the income, capital appreciation and gain or loss that would have been realized on the","page_number":86,"box":{"x":69,"y":377,"width":833,"height":12}},{"id":"895b63ce-6a3d-4250-9a59-a69f6fe2878f","block_type":"box","text":"securities sold as part of the dollar roll, the use of this technique will diminish the investment performance of a Fund","page_number":86,"box":{"x":69,"y":392,"width":836,"height":11}},{"id":"e11e6d77-d49b-4f2b-86e1-906b04c52f3a","block_type":"box","text":"compared with what the performance would have been without the use of dollar rolls.","page_number":86,"box":{"x":69,"y":407,"width":607,"height":11}},{"id":"afeaa837-b272-4e6c-92fb-709a76cbd5a4","block_type":"box","text":"Each mortgage dollar roll transaction is accounted for as a sale or purchase of a portfolio security and a","page_number":86,"box":{"x":102,"y":430,"width":744,"height":11}},{"id":"c5b7f7be-2ef6-4983-af15-16b12b2175a3","block_type":"box","text":"subsequent purchase or sale of a substantially similar security in the forward market. Transactions in mortgage","page_number":86,"box":{"x":69,"y":445,"width":796,"height":12}},{"id":"3a38673b-a0ce-40b8-b6cf-b2a4331cfe93","block_type":"box","text":"dollar rolls may increase trading costs and portfolio turnover.","page_number":86,"box":{"x":69,"y":460,"width":433,"height":12}},{"id":"f38ae419-87c9-44fa-965b-91472c450b4b","block_type":"box","text":"In the event the buyer of the securities under a mortgage dollar roll files for bankruptcy or becomes insolvent, a","page_number":86,"box":{"x":102,"y":483,"width":795,"height":11}},{"id":"a4359416-8822-4afd-a522-0190912a9aaf","block_type":"box","text":"Fund’s use of the proceeds of the current sale portion of the transaction may be restricted pending a determination","page_number":86,"box":{"x":70,"y":498,"width":824,"height":11}},{"id":"fcb048a4-a0d4-40f3-b571-e0c2d8e19595","block_type":"box","text":"by the other party, or its trustee or receiver, whether to enforce the Fund’s obligation to purchase the similar","page_number":86,"box":{"x":69,"y":513,"width":774,"height":12}},{"id":"10e05deb-f553-4322-9f9a-36919ed950d6","block_type":"box","text":"securities in the forward transaction.","page_number":86,"box":{"x":69,"y":528,"width":261,"height":9}},{"id":"56c7bbd0-e3b1-4b42-9af4-4434ba489b32","block_type":"box","text":"A Fund may engage in dollar roll transactions to enhance returns. Successful use of mortgage dollar rolls may","page_number":86,"box":{"x":101,"y":551,"width":785,"height":11}},{"id":"a06c4f13-4a6e-4240-be93-6c47514fe2ee","block_type":"box","text":"depend upon the Manager’s ability to correctly predict interest rates and prepayments. Dollar rolls involve the risk","page_number":86,"box":{"x":69,"y":566,"width":812,"height":11}},{"id":"31dc02d6-7d04-4396-9b8b-04eafe9fa103","block_type":"box","text":"that the market value of the securities subject to a Fund’s forward purchase commitment may decline below, or the","page_number":86,"box":{"x":68,"y":581,"width":824,"height":11}},{"id":"6bd77eec-b42d-4ab2-8616-0a87f32b9bd4","block_type":"box","text":"market value of the securities subject to a Fund’s forward sale commitment may increase above, the exercise price","page_number":86,"box":{"x":69,"y":596,"width":824,"height":12}},{"id":"367227b3-1163-40d5-a1f2-392689cd0d41","block_type":"box","text":"of the forward commitment. Dollar rolls are speculative techniques that can be deemed to involve leverage. There is","page_number":86,"box":{"x":69,"y":612,"width":828,"height":11}},{"id":"1f5e54eb-390e-49de-9841-6f8b339cf2a8","block_type":"box","text":"no assurance that dollar rolls can be successfully employed.","page_number":86,"box":{"x":69,"y":627,"width":430,"height":11}},{"id":"69cc2a6a-6ae5-41f1-bdd0-8fbdc45993e7","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into when-issued or forward-settling","page_number":86,"box":{"x":102,"y":649,"width":759,"height":12}},{"id":"f26255ef-1d04-4014-aad5-d67b38ef1865","block_type":"box","text":"securities (","page_number":86,"box":{"x":69,"y":665,"width":78,"height":11}},{"id":"55a6e0dc-107c-4c01-8d0b-544acc39103a","block_type":"box","text":"e.g.","page_number":86,"box":{"x":148,"y":666,"width":25,"height":10}},{"id":"8ef1772d-4383-4f86-9e59-59ed9f237eff","block_type":"box","text":", dollar rolls and firm and standby commitments, including TBA commitments) and non-standard","page_number":86,"box":{"x":176,"y":664,"width":681,"height":12}},{"id":"ebc34bb8-04aa-400a-86f2-052b70107409","block_type":"box","text":"settlement cycle securities notwithstanding the limitation on the issuance of senior securities in Section 18 of the","page_number":86,"box":{"x":69,"y":680,"width":813,"height":11}},{"id":"eae28743-3857-44b3-b68e-44ef6d4b9071","block_type":"box","text":"Investment Company Act, provided that the transaction meets the Delayed-Settlement Securities Provision (as","page_number":86,"box":{"x":70,"y":695,"width":783,"height":11}},{"id":"ec60a814-e548-414d-b3f8-ce960bad58a3","block_type":"box","text":"defined below under “—When-Issued Securities, Delayed Delivery Securities and Forward Commitments”). If a when","page_number":86,"box":{"x":69,"y":710,"width":832,"height":11}},{"id":"5e0aad15-e301-4ac3-ba9d-0efe679f2d0e","block_type":"box","text":"issued, forward-settling or non-standard settlement cycle security does not satisfy the Delayed-Settlement Securities","page_number":86,"box":{"x":70,"y":725,"width":830,"height":11}},{"id":"963dceb0-3a34-449e-ad8b-80bd3506f62b","block_type":"box","text":"Provision, then it is treated as a Derivatives Transaction under Rule 18f-4. See “—Derivatives — Regulation of","page_number":86,"box":{"x":69,"y":740,"width":788,"height":11}},{"id":"617d44a7-5ffb-43a4-a929-d254555777f9","block_type":"box","text":"Derivatives — Rule 18f-4 under the Investment Company Act” above.","page_number":86,"box":{"x":70,"y":755,"width":489,"height":11}},{"id":"e6d62cd1-ecc7-4564-b7dc-907bfe7d7b04","block_type":"box","text":"Net Interest Margin (NIM) Securities.","page_number":86,"box":{"x":102,"y":778,"width":260,"height":11}},{"id":"b9969031-9ea2-42a7-9278-355ebf0aa453","block_type":"box","text":"A Fund may invest in net interest margin (“NIM”) securities. These","page_number":86,"box":{"x":368,"y":778,"width":473,"height":11}},{"id":"315a6dc5-697e-4d56-9569-cb3e2cbb367e","block_type":"box","text":"securities are derivative interest-only mortgage securities structured off home equity loan transactions. NIM","page_number":86,"box":{"x":69,"y":793,"width":768,"height":11}},{"id":"57480996-885b-4860-8dca-c78ef7cd21ff","block_type":"box","text":"securities receive any “excess” interest computed after paying coupon costs, servicing costs and fees and any credit","page_number":86,"box":{"x":69,"y":808,"width":836,"height":11}},{"id":"4fb21c63-3826-469f-8320-3245e976d76b","block_type":"box","text":"losses associated with the underlying pool of home equity loans. Like traditional stripped mortgage-backed","page_number":86,"box":{"x":70,"y":823,"width":760,"height":12}},{"id":"7909d7aa-8699-46ba-9974-a8642c3250f0","block_type":"box","text":"securities, the yield to maturity on a NIM security is sensitive not only to changes in prevailing interest rates but also","page_number":86,"box":{"x":69,"y":839,"width":832,"height":11}},{"id":"3d235fd2-f7a7-4cf2-8776-2974d8711db9","block_type":"box","text":"to the rate of principal payments (including prepayments) on the underlying home equity loans. NIM securities are","page_number":86,"box":{"x":68,"y":853,"width":810,"height":12}},{"id":"eb0c8cb3-b361-411a-8881-83eaf009931d","block_type":"box","text":"highly sensitive to credit losses on the underlying collateral and the timing in which those losses are taken.","page_number":86,"box":{"x":69,"y":869,"width":764,"height":11}},{"id":"8245f1a0-3ad4-48a1-a57b-cf21bba22d2f","block_type":"box","text":"Municipal Investments.","page_number":86,"box":{"x":102,"y":891,"width":169,"height":11}},{"id":"26e25e5b-6e8f-4212-ace7-8fbf8abb2605","block_type":"box","text":"II-55","page_number":86,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"4887e3df-915d-4c82-8a35-d5f35a915d2c","block_type":"box","text":"NM0926U-5977317-86/232","page_number":86,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"0b9a1ace-27cd-422b-82d4-2eb4f6eca666","block_type":"box","text":"Certain Funds may invest in obligations issued by or on behalf of states, territories and possessions of the","page_number":87,"box":{"x":102,"y":45,"width":763,"height":11}},{"id":"4cbeaf8f-8212-4291-ac7c-e3b52720fd2f","block_type":"box","text":"United States and the District of Columbia and their political subdivisions, agencies and instrumentalities, the","page_number":87,"box":{"x":70,"y":60,"width":783,"height":11}},{"id":"f7a1904a-e5ae-432b-9e91-3ca6128f16c2","block_type":"box","text":"payments from which, in the opinion of bond counsel to the issuer, are excludable from gross income for U.S. federal","page_number":87,"box":{"x":70,"y":75,"width":833,"height":11}},{"id":"9554b58e-b9ee-49cb-bdc2-749366626a4b","block_type":"box","text":"income tax purposes (“Municipal Bonds”). Certain of the Municipal Funds may also invest in Municipal Bonds that","page_number":87,"box":{"x":70,"y":90,"width":813,"height":11}},{"id":"fa20a2de-a9a3-4889-a7ac-2bc946185bb3","block_type":"box","text":"pay interest excludable from gross income for purposes of state and local income taxes of the designated state and/","page_number":87,"box":{"x":70,"y":105,"width":836,"height":11}},{"id":"c644af90-a780-43a5-ace2-4f7f2607aaf7","block_type":"box","text":"or allow the value of a Fund’s shares to be exempt from state and local taxes of the designated state (“State","page_number":87,"box":{"x":69,"y":120,"width":779,"height":12}},{"id":"87314c07-322f-4b9a-8ac3-abff63a93094","block_type":"box","text":"Municipal Bonds”). The Municipal Funds may also invest in securities not issued by or on behalf of a state or territory","page_number":87,"box":{"x":70,"y":135,"width":838,"height":11}},{"id":"98668034-359a-4af9-b2c7-9d0151d121d2","block_type":"box","text":"or by an agency or instrumentality thereof, if the Manager believes such securities to pay interest excludable from","page_number":87,"box":{"x":69,"y":150,"width":810,"height":12}},{"id":"2faf8a03-5e91-4562-b1be-2b8db6551e99","block_type":"box","text":"gross income for purposes of U.S. federal income tax and state and local income taxes of the designated state and/","page_number":87,"box":{"x":68,"y":166,"width":834,"height":11}},{"id":"347937b7-a79d-4650-90eb-0bdd0b7a11f0","block_type":"box","text":"or state and local personal property taxes of the designated state (“Non-Municipal Tax-Exempt Securities”). Non","page_number":87,"box":{"x":69,"y":181,"width":801,"height":11}},{"id":"0f324fdd-7d3d-4433-a5d7-ee698661730a","block_type":"box","text":"Municipal Tax-Exempt Securities could include trust certificates or other instruments evidencing interest in one or","page_number":87,"box":{"x":70,"y":196,"width":807,"height":11}},{"id":"35d446bb-a707-433e-94ee-64b75980a62b","block_type":"box","text":"more long-term municipal securities. Non-Municipal Tax-Exempt Securities also may include securities issued by other","page_number":87,"box":{"x":69,"y":211,"width":837,"height":11}},{"id":"5adf00a6-3f9e-4e7c-9e3a-cdc46d2591cd","block_type":"box","text":"investment companies that invest in municipal bonds, to the extent such investments are permitted by applicable","page_number":87,"box":{"x":70,"y":226,"width":809,"height":11}},{"id":"f5783079-fbb2-4cdf-938e-39acd67ebd82","block_type":"box","text":"law. Non-Municipal Tax-Exempt Securities that pay interest excludable from gross income for U.S. federal income tax","page_number":87,"box":{"x":70,"y":241,"width":826,"height":11}},{"id":"ea3542ae-6e74-4cae-b15e-132217016b37","block_type":"box","text":"purposes will be considered “Municipal Bonds” for purposes of a Municipal Fund’s investment objective and policies.","page_number":87,"box":{"x":70,"y":256,"width":834,"height":11}},{"id":"f6c65757-d85a-4546-8899-d2be6d76e98c","block_type":"box","text":"Non-Municipal Tax-Exempt Securities that pay interest excludable from gross income for purposes of U.S. federal","page_number":87,"box":{"x":70,"y":271,"width":800,"height":12}},{"id":"30cf60a8-d791-47c6-b723-cf709c873cae","block_type":"box","text":"income tax and state and local income taxes of a designated state and/or allow the value of a Fund’s shares to be","page_number":87,"box":{"x":70,"y":286,"width":819,"height":12}},{"id":"0251e645-e99b-4417-83b7-735fb577bf85","block_type":"box","text":"exempt from state and local personal property taxes of that state will be considered “State Municipal Bonds” for","page_number":87,"box":{"x":69,"y":302,"width":805,"height":11}},{"id":"be6b2174-9993-4a7f-8452-746ae3c5d1cc","block_type":"box","text":"purposes of the investment objective and policies of each of California Municipal Opportunities Fund, New Jersey","page_number":87,"box":{"x":70,"y":317,"width":805,"height":11}},{"id":"05a5d49c-328c-4f69-a9a5-838de004d75d","block_type":"box","text":"Municipal Bond Fund, New York Municipal Opportunities Fund and Pennsylvania Municipal Bond Fund.","page_number":87,"box":{"x":70,"y":332,"width":721,"height":11}},{"id":"bd800ffa-1c6f-4ba5-b5b9-c011eb73ccd8","block_type":"box","text":"Risk Factors and Special Considerations Relating to Municipal Bonds.","page_number":87,"box":{"x":102,"y":355,"width":495,"height":11}},{"id":"913c223f-fd06-4037-8c4b-fc89aded834f","block_type":"box","text":"The risks and special considerations","page_number":87,"box":{"x":603,"y":355,"width":260,"height":11}},{"id":"d0c02dfa-e83f-4fda-89e2-9aee72d02675","block_type":"box","text":"involved in investment in Municipal Bonds vary with the types of instruments being acquired. Investments in Non","page_number":87,"box":{"x":70,"y":370,"width":806,"height":11}},{"id":"fa154ce4-9585-4909-91e0-aafdee27b0ea","block_type":"box","text":"Municipal Tax-Exempt Securities may present similar risks, depending on the particular product. Certain municipal","page_number":87,"box":{"x":70,"y":385,"width":810,"height":11}},{"id":"d4dfc1b1-3639-4c87-8ffe-a637c6c6714c","block_type":"box","text":"instruments in which a Fund may invest may be characterized as derivatives.","page_number":87,"box":{"x":70,"y":400,"width":544,"height":11}},{"id":"75319709-abcc-4ca0-99e2-8937c8b7d787","block_type":"box","text":"The value of Municipal Bonds generally may be affected by uncertainties in the municipal markets as a result of","page_number":87,"box":{"x":101,"y":423,"width":799,"height":11}},{"id":"5a4952f5-8b90-4492-b918-41baea0f5239","block_type":"box","text":"legislation or litigation, including legislation or litigation that changes the taxation of Municipal Bonds or the rights of","page_number":87,"box":{"x":70,"y":438,"width":829,"height":11}},{"id":"1d84e110-ecd9-43b3-a349-f3695c9678ef","block_type":"box","text":"Municipal Bond holders in the event of a bankruptcy. Municipal bankruptcies are rare and certain provisions of the","page_number":87,"box":{"x":70,"y":453,"width":814,"height":11}},{"id":"bb2c2730-bab7-41a7-9aa8-6bac8544ecc0","block_type":"box","text":"U.S. Bankruptcy Code governing such bankruptcies are unclear. Further, the application of state law to Municipal","page_number":87,"box":{"x":70,"y":468,"width":802,"height":11}},{"id":"e4548269-b99d-4283-82bf-08e9ff09d145","block_type":"box","text":"Bond issuers could produce varying results among the states or among Municipal Bond issuers within a state. These","page_number":87,"box":{"x":70,"y":483,"width":834,"height":11}},{"id":"5eb71383-e9a4-4c63-95fe-2e2345b9cc69","block_type":"box","text":"uncertainties could have a significant impact on the prices of the Municipal Bonds in which a Fund invests.","page_number":87,"box":{"x":69,"y":498,"width":761,"height":11}},{"id":"e3799e0c-7ffc-400a-aa36-bf2b1ad38ae1","block_type":"box","text":"II-56","page_number":87,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"9f6dae52-a2ee-435e-8542-c5146ad80b29","block_type":"box","text":"NM0926U-5977317-87/232","page_number":87,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"85c8b352-c268-4726-8b84-4e5f7ceb0579","block_type":"box","text":"Description of Municipal Bonds.","page_number":88,"box":{"x":70,"y":45,"width":224,"height":11}},{"id":"fb03a6cf-3d4c-4d2c-9404-ec6365c96e9a","block_type":"box","text":"Municipal Bonds include debt obligations issued to obtain funds for various public purposes, including the","page_number":88,"box":{"x":102,"y":67,"width":754,"height":12}},{"id":"7eaf3f06-1680-4fe7-bb69-ef4b183756d9","block_type":"box","text":"construction of a wide range of public facilities, refunding of outstanding obligations and obtaining funds for general","page_number":88,"box":{"x":69,"y":82,"width":824,"height":12}},{"id":"6d3d6795-c6f0-437c-a3f6-02260edbc866","block_type":"box","text":"operating expenses and loans to other public institutions and facilities. In addition, certain types of bonds are issued","page_number":88,"box":{"x":69,"y":98,"width":836,"height":11}},{"id":"28480a2e-f0f4-49ee-b6c1-5cefdb149792","block_type":"box","text":"by or on behalf of public authorities to finance various privately owned or operated facilities, including certain","page_number":88,"box":{"x":69,"y":113,"width":776,"height":11}},{"id":"a49e2e24-20ff-457b-9065-039e4814e72e","block_type":"box","text":"facilities for the local furnishing of electric energy or gas, sewage facilities, solid waste disposal facilities and other","page_number":88,"box":{"x":68,"y":128,"width":822,"height":11}},{"id":"07fafe8a-1470-4949-a6cf-383b146f4cea","block_type":"box","text":"specialized facilities. Such obligations are included within the term Municipal Bonds if the interest paid thereon is","page_number":88,"box":{"x":69,"y":143,"width":810,"height":11}},{"id":"9d33446a-2938-4515-905d-68d8634fc1cc","block_type":"box","text":"excluded from gross income for U.S. federal income tax purposes and any applicable state and local taxes. Other","page_number":88,"box":{"x":69,"y":158,"width":808,"height":11}},{"id":"ba1caba9-3352-4a2b-81d5-1c8c709777c7","block_type":"box","text":"types of private activity bonds, the proceeds of which are used for the construction, equipment or improvement of","page_number":88,"box":{"x":68,"y":173,"width":812,"height":11}},{"id":"f599b596-6541-43e8-9204-a45fff8a384f","block_type":"box","text":"privately operated industrial or commercial facilities, may constitute Municipal Bonds, although the current U.S.","page_number":88,"box":{"x":70,"y":188,"width":792,"height":12}},{"id":"bf72aaa7-887b-414e-9780-22a935f019b8","block_type":"box","text":"federal tax laws place substantial limitations on the size of such issues. The interest on Municipal Bonds may bear a","page_number":88,"box":{"x":68,"y":203,"width":835,"height":12}},{"id":"3b30f435-f1be-4ea5-b48a-0fba35bc8b55","block_type":"box","text":"fixed rate or be payable at a variable or floating rate. The two principal classifications of Municipal Bonds are “general","page_number":88,"box":{"x":68,"y":218,"width":840,"height":12}},{"id":"234ac036-2c3b-46e6-9958-70a82d883a71","block_type":"box","text":"obligation” and “revenue” or “special obligation” bonds, which latter category includes private activity bonds (“PABs”)","page_number":88,"box":{"x":69,"y":234,"width":838,"height":11}},{"id":"e9b069fb-7b34-4956-a8db-7571800f6967","block_type":"box","text":"(or “industrial development bonds” under pre-1986 law).","page_number":88,"box":{"x":69,"y":249,"width":401,"height":11}},{"id":"e431225a-4928-4a98-84f3-ffeb17e166f2","block_type":"box","text":"General Obligation Bonds.","page_number":88,"box":{"x":102,"y":272,"width":184,"height":11}},{"id":"d7d80f26-58be-4a6d-8aaa-af79e81cc508","block_type":"box","text":"General obligation bonds are secured by the issuer’s pledge of its full faith, credit and","page_number":88,"box":{"x":292,"y":271,"width":613,"height":12}},{"id":"c37e64f2-3578-4cc4-a8fb-efacf22c3de0","block_type":"box","text":"taxing power for the payment of principal and interest. The taxing power of any governmental entity may be limited,","page_number":88,"box":{"x":68,"y":286,"width":816,"height":12}},{"id":"b1853211-39d3-457e-a7d0-f7b74e21a8e7","block_type":"box","text":"however, by provisions of its state constitution or laws, and an entity’s creditworthiness will depend on many factors,","page_number":88,"box":{"x":69,"y":302,"width":834,"height":11}},{"id":"f40b2ce7-389a-4cc5-84c7-d2c0f94df2d3","block_type":"box","text":"including potential erosion of its tax base due to population declines, natural disasters, declines in the state’s","page_number":88,"box":{"x":70,"y":317,"width":786,"height":11}},{"id":"6d36371f-be15-4905-8548-4125eef8c0ab","block_type":"box","text":"industrial base or inability to attract new industries, economic limits on the ability to tax without eroding the tax base,","page_number":88,"box":{"x":70,"y":332,"width":835,"height":11}},{"id":"5c4923ab-15dc-4449-b68c-e053e53a1459","block_type":"box","text":"state legislative proposals or voter initiatives to limit ad valorem real property taxes and the extent to which the entity","page_number":88,"box":{"x":69,"y":347,"width":840,"height":11}},{"id":"0215c405-b773-4eb3-a9ea-169c81d5f5e7","block_type":"box","text":"relies on federal or state aid, access to capital markets or other factors beyond the state’s or entity’s control.","page_number":88,"box":{"x":69,"y":362,"width":782,"height":11}},{"id":"89cbe616-5329-459f-a437-b35a4c76983e","block_type":"box","text":"Accordingly, the capacity of the issuer of a general obligation bond as to the timely payment of interest and the","page_number":88,"box":{"x":68,"y":377,"width":791,"height":12}},{"id":"39e03a8f-2b4b-41a6-8df7-edab98254e67","block_type":"box","text":"repayment of principal when due is affected by the issuer’s maintenance of its tax base.","page_number":88,"box":{"x":69,"y":392,"width":630,"height":12}},{"id":"6f1985bc-46a9-4719-9664-3fe72c536e71","block_type":"box","text":"Revenue Bonds.","page_number":88,"box":{"x":102,"y":415,"width":114,"height":9}},{"id":"141c0208-7548-4ca2-a0db-f82c6af74653","block_type":"box","text":"Revenue bonds are payable only from the revenues derived from a particular facility or class of","page_number":88,"box":{"x":223,"y":415,"width":676,"height":11}},{"id":"e5c3f510-a681-4d89-9755-9bcb359c7aa6","block_type":"box","text":"facilities or, in some cases, from the proceeds of a special excise tax or other specific revenue source such as","page_number":88,"box":{"x":68,"y":430,"width":791,"height":11}},{"id":"45521f43-e14e-4943-b84a-7f74f735e894","block_type":"box","text":"payments from the user of the facility being financed; accordingly, the timely payment of interest and the repayment","page_number":88,"box":{"x":70,"y":445,"width":824,"height":12}},{"id":"cb49c581-ade4-49a0-b962-0d6e25a649b4","block_type":"box","text":"of principal in accordance with the terms of the revenue or special obligation bond is a function of the economic","page_number":88,"box":{"x":69,"y":460,"width":798,"height":12}},{"id":"a921af71-3976-4684-b753-ebf195a9b675","block_type":"box","text":"viability of such facility or such revenue source.","page_number":88,"box":{"x":68,"y":475,"width":336,"height":12}},{"id":"8889cb8b-6bad-4e77-8787-b54e2722624d","block_type":"box","text":"Revenue bonds issued by state or local agencies to finance the development of low-income, multi-family housing","page_number":88,"box":{"x":102,"y":498,"width":801,"height":11}},{"id":"694f9cca-8b34-4161-aec0-2c7626b43ded","block_type":"box","text":"involve special risks in addition to those associated with municipal bonds generally, including that the underlying","page_number":88,"box":{"x":70,"y":514,"width":800,"height":11}},{"id":"2609c96a-657c-47cb-84b7-f03843b326fc","block_type":"box","text":"properties may not generate sufficient income to pay expenses and interest costs. Such bonds are generally non","page_number":88,"box":{"x":70,"y":528,"width":810,"height":12}},{"id":"a95ea705-bc6e-4db4-ac58-f6b19ea4168e","block_type":"box","text":"recourse against the property owner, may be junior to the rights of others with an interest in the properties, may pay","page_number":88,"box":{"x":69,"y":543,"width":830,"height":12}},{"id":"b7e49ec9-152f-41aa-835d-402b3dcf3139","block_type":"box","text":"interest that changes based in part on the financial performance of the property, may be prepayable without penalty","page_number":88,"box":{"x":70,"y":559,"width":828,"height":11}},{"id":"e44c1a1b-8a25-445d-a02c-aecc7224a8ee","block_type":"box","text":"and may be used to finance the construction of housing developments which, until completed and rented, do not","page_number":88,"box":{"x":69,"y":574,"width":804,"height":11}},{"id":"7bdb9890-acc4-4670-876b-74de55485272","block_type":"box","text":"generate income to pay interest. Increases in interest rates payable on senior obligations may make it more difficult","page_number":88,"box":{"x":68,"y":589,"width":830,"height":11}},{"id":"5fe00a1c-9933-4cee-a8c1-f47707c27604","block_type":"box","text":"for issuers to meet payment obligations on subordinated bonds.","page_number":88,"box":{"x":68,"y":604,"width":457,"height":11}},{"id":"e24ad1bc-dacc-492d-bde9-7766e3529da9","block_type":"box","text":"PABs.","page_number":88,"box":{"x":102,"y":627,"width":38,"height":9}},{"id":"2252be4f-c888-4a96-bf30-af8c648829d7","block_type":"box","text":"PABs are, in most cases, tax-exempt securities issued by states, municipalities or public authorities to","page_number":88,"box":{"x":147,"y":627,"width":730,"height":11}},{"id":"233669f5-41ac-49f1-837c-d56706e13b46","block_type":"box","text":"provide funds, usually through a loan or lease arrangement, to a private entity for the purpose of financing","page_number":88,"box":{"x":70,"y":642,"width":755,"height":11}},{"id":"3ab81387-1c9b-4ae3-a445-70f55aef6992","block_type":"box","text":"construction or improvement of a facility to be used by the entity. Such bonds are secured primarily by revenues","page_number":88,"box":{"x":69,"y":657,"width":797,"height":11}},{"id":"732ba29a-8a21-4190-8667-9ab8155f291a","block_type":"box","text":"derived from loan repayments or lease payments due from the entity, which may or may not be guaranteed by a","page_number":88,"box":{"x":69,"y":672,"width":793,"height":11}},{"id":"9bb489e4-02a3-4942-b186-06f8ed813fc9","block_type":"box","text":"parent company or otherwise secured. PABs generally are not secured by a pledge of the taxing power of the issuer of","page_number":88,"box":{"x":70,"y":687,"width":840,"height":11}},{"id":"2197f6a8-98cb-4feb-b092-6f405d57a9d8","block_type":"box","text":"such bonds. Therefore, an investor should understand that repayment of such bonds generally depends on the","page_number":88,"box":{"x":69,"y":702,"width":789,"height":12}},{"id":"e94019c7-d4c0-4a65-9e32-a994b71d806d","block_type":"box","text":"revenues of a private entity and be aware of the risks that such an investment may entail. The continued ability of an","page_number":88,"box":{"x":69,"y":717,"width":832,"height":12}},{"id":"81f74b44-3383-4a35-84b2-8f479284347b","block_type":"box","text":"entity to generate sufficient revenues for the payment of principal and interest on such bonds will be affected by","page_number":88,"box":{"x":69,"y":732,"width":802,"height":12}},{"id":"f7136181-0049-407a-b6d3-9b51b1258e44","block_type":"box","text":"many factors including the size of the entity, its capital structure, demand for its products or services, competition,","page_number":88,"box":{"x":69,"y":748,"width":819,"height":11}},{"id":"de558f0d-de0c-45ba-bee4-d76efe68e426","block_type":"box","text":"general economic conditions, government regulation and the entity’s dependence on revenues for the operation of","page_number":88,"box":{"x":68,"y":763,"width":816,"height":11}},{"id":"51da6d7f-cdde-4d81-b3a8-7976f0b25831","block_type":"box","text":"the particular facility being financed.","page_number":88,"box":{"x":68,"y":778,"width":258,"height":11}},{"id":"288c250a-fea2-45a8-9497-f6016105b6bd","block_type":"box","text":"Moral Obligation Bonds.","page_number":88,"box":{"x":102,"y":801,"width":169,"height":11}},{"id":"85b5b28f-51c6-42ec-8bd8-c0bb6d72c580","block_type":"box","text":"“Moral obligation” bonds are normally issued by special purpose public authorities. If an","page_number":88,"box":{"x":278,"y":801,"width":628,"height":11}},{"id":"c0f33b13-e750-4df1-82c5-14890d106e93","block_type":"box","text":"issuer of moral obligation bonds is unable to meet its obligations, the repayment of such bonds becomes a moral","page_number":88,"box":{"x":70,"y":816,"width":809,"height":11}},{"id":"87aaacd5-3c11-4317-b059-bb612d300232","block_type":"box","text":"commitment but not a legal obligation of the state or municipality that created the special purpose public authority","page_number":88,"box":{"x":69,"y":831,"width":816,"height":11}},{"id":"13141211-f0ea-492c-975a-c47c55bc0068","block_type":"box","text":"that issued the bonds.","page_number":88,"box":{"x":68,"y":846,"width":160,"height":9}},{"id":"4a50700b-0928-4fc0-adfa-32b07ed6ba07","block_type":"box","text":"Municipal Notes.","page_number":88,"box":{"x":102,"y":869,"width":118,"height":11}},{"id":"46b2b13a-03b0-4c53-80d2-3f55cd54100e","block_type":"box","text":"Municipal notes are shorter term municipal debt obligations. They may provide interim financing","page_number":88,"box":{"x":227,"y":869,"width":683,"height":11}},{"id":"a7ee5a3d-9884-4e74-bf19-b326d7c007f3","block_type":"box","text":"in anticipation of tax collection, bond sales or revenue receipts. If there is a shortfall in the anticipated proceeds,","page_number":88,"box":{"x":70,"y":884,"width":807,"height":11}},{"id":"eeba3f04-6c97-4856-91d5-33cc607dc673","block_type":"box","text":"repayment on the note may be delayed or the note may not be fully repaid, and a Fund may lose money.","page_number":88,"box":{"x":69,"y":899,"width":739,"height":11}},{"id":"2e3e1916-0af3-4ff4-bde1-cda2823ad353","block_type":"box","text":"II-57","page_number":88,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"5f960d25-d2ab-4d01-8552-fac6b3b212d9","block_type":"box","text":"NM0926U-5977317-88/232","page_number":88,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"0f2b22c5-1607-4485-96a2-665e79fd7e33","block_type":"box","text":"Municipal Commercial Paper.","page_number":89,"box":{"x":102,"y":45,"width":205,"height":11}},{"id":"e0a9c521-d60e-4ef4-ace3-c0dec2e95b42","block_type":"box","text":"Municipal commercial paper is generally unsecured and issued to meet short-term","page_number":89,"box":{"x":314,"y":45,"width":586,"height":11}},{"id":"caf0e11e-4f5c-4575-8b5c-2716a676095d","block_type":"box","text":"financing needs. The lack of security presents some risk of loss to a Fund since, in the event of an issuer’s","page_number":89,"box":{"x":68,"y":60,"width":767,"height":11}},{"id":"1c24312e-5da7-4b9b-8868-7f9ee2f719da","block_type":"box","text":"bankruptcy, unsecured creditors are repaid only after the secured creditors out of the assets, if any, that remain.","page_number":89,"box":{"x":69,"y":75,"width":803,"height":11}},{"id":"de667c3c-9ed5-4a62-9bea-7f2c61e6f53a","block_type":"box","text":"Municipal Lease Obligations.","page_number":89,"box":{"x":102,"y":98,"width":203,"height":11}},{"id":"c6ec7ccf-80e4-41d0-8919-63a04777bc66","block_type":"box","text":"Also included within the general category of Municipal Bonds are certificates of","page_number":89,"box":{"x":311,"y":98,"width":566,"height":11}},{"id":"1bc46fad-b0ee-4d39-a48c-9e99a72e1477","block_type":"box","text":"participation (“COPs”) issued by government authorities or entities to finance the acquisition or construction of","page_number":89,"box":{"x":70,"y":113,"width":791,"height":11}},{"id":"0e1a3390-69d2-4cdb-91c3-62b66eae8ec1","block_type":"box","text":"equipment, land and/or facilities. The COPs represent participations in a lease, an installment purchase contract or a","page_number":89,"box":{"x":69,"y":128,"width":840,"height":11}},{"id":"01c445fc-d4f1-40e1-be53-a74099131c31","block_type":"box","text":"conditional sales contract (hereinafter collectively called “lease obligations”) relating to such equipment, land or","page_number":89,"box":{"x":69,"y":143,"width":800,"height":11}},{"id":"236e3c48-217a-4a5f-ab49-6748a37d58d3","block_type":"box","text":"facilities. Municipal leases, like other municipal debt obligations, are subject to the risk of non-payment. Although","page_number":89,"box":{"x":68,"y":158,"width":809,"height":11}},{"id":"a81f759e-82b2-4283-80ef-4c34e934e17b","block_type":"box","text":"lease obligations do not constitute general obligations of the issuer for which the issuer’s unlimited taxing power is","page_number":89,"box":{"x":70,"y":173,"width":820,"height":11}},{"id":"68d48359-1478-4ad5-a7a1-fa3f69c62ce2","block_type":"box","text":"pledged, a lease obligation is frequently backed by the issuer’s covenant to budget for, appropriate and make the","page_number":89,"box":{"x":70,"y":188,"width":808,"height":12}},{"id":"8adf98e6-62d8-4f46-a75a-23f1c117d602","block_type":"box","text":"payments due under the lease obligation. However, certain lease obligations contain “non-appropriation” clauses,","page_number":89,"box":{"x":70,"y":204,"width":809,"height":11}},{"id":"5025fbe5-27d3-4112-953d-7d4a65938715","block_type":"box","text":"which provide that the issuer has no obligation to make lease or installment purchase payments in future years","page_number":89,"box":{"x":68,"y":218,"width":795,"height":12}},{"id":"da706bc3-e318-46e8-a3ec-c77360d9f844","block_type":"box","text":"unless money is appropriated for such purpose on a yearly basis. Although “non-appropriation” lease obligations are","page_number":89,"box":{"x":69,"y":234,"width":829,"height":11}},{"id":"97ce5a54-eaef-4d55-9041-8a233b403c34","block_type":"box","text":"secured by the leased property, disposition of the property in the event of foreclosure might prove difficult. These","page_number":89,"box":{"x":69,"y":249,"width":810,"height":11}},{"id":"daf5a345-6e5f-4602-ac8f-4568119c602c","block_type":"box","text":"securities represent a type of financing that has not yet developed the depth of marketability associated with more","page_number":89,"box":{"x":69,"y":264,"width":817,"height":11}},{"id":"12374efa-2cad-4afd-84dc-3be8daf23a30","block_type":"box","text":"conventional securities. Certain investments in lease obligations may be illiquid.","page_number":89,"box":{"x":69,"y":279,"width":572,"height":11}},{"id":"70683c22-d61e-4387-9a2b-80a3b6436258","block_type":"box","text":"The ability of issuers of municipal leases to make timely lease payments may be adversely impacted in general","page_number":89,"box":{"x":101,"y":302,"width":791,"height":11}},{"id":"ed90d775-36e9-4d1f-b706-e276159620dc","block_type":"box","text":"economic downturns and as relative governmental cost burdens are allocated and reallocated among federal, state","page_number":89,"box":{"x":69,"y":317,"width":822,"height":11}},{"id":"5ec6f88d-3d6d-4145-b02e-1e377888af8e","block_type":"box","text":"and local governmental units. Such non-payment would result in a reduction of income to a Fund and could result in a","page_number":89,"box":{"x":69,"y":332,"width":837,"height":11}},{"id":"b3f711ac-aa7a-4796-9714-9e4d39c2016d","block_type":"box","text":"reduction in the value of the municipal lease experiencing non-payment and a potential decrease in the NAV of a","page_number":89,"box":{"x":69,"y":347,"width":798,"height":11}},{"id":"0a7cce42-c89a-4f36-9479-7e8798f8fdce","block_type":"box","text":"Fund. Issuers of municipal securities might seek protection under the bankruptcy laws. In the event of bankruptcy of","page_number":89,"box":{"x":70,"y":362,"width":828,"height":11}},{"id":"d61246d5-2fbd-4764-9ea6-6c7620aee939","block_type":"box","text":"such an issuer, a Fund could experience delays and limitations with respect to the collection of principal and interest","page_number":89,"box":{"x":69,"y":377,"width":833,"height":11}},{"id":"7fabfeae-e9f7-463a-a0ce-d2f42f61d860","block_type":"box","text":"on such municipal leases and a Fund may not, in all circumstances, be able to collect all principal and interest to","page_number":89,"box":{"x":69,"y":393,"width":807,"height":11}},{"id":"d531ac89-0293-42bd-b3d8-903f51c7e835","block_type":"box","text":"which it is entitled. To enforce its rights in the event of a default in lease payments, a Fund might take possession of","page_number":89,"box":{"x":68,"y":407,"width":835,"height":12}},{"id":"e7bca63d-940a-40dd-adea-de0b88b6eb76","block_type":"box","text":"and manage the assets securing the issuer’s obligations on such securities, which may increase a Fund’s operating","page_number":89,"box":{"x":69,"y":423,"width":828,"height":11}},{"id":"73e0cc4b-1275-4e94-a213-a2afb52c0565","block_type":"box","text":"expenses and adversely affect the NAV of a Fund. When the lease contains a non-appropriation clause, however, the","page_number":89,"box":{"x":69,"y":438,"width":829,"height":11}},{"id":"8764ac48-51b9-4536-9fe2-e65fdedff2cf","block_type":"box","text":"failure to pay would not be a default and a Fund would not have the right to take possession of the assets. Any","page_number":89,"box":{"x":68,"y":453,"width":793,"height":11}},{"id":"15a47aa2-17c6-44bf-993b-bc21713360cb","block_type":"box","text":"income derived from a Fund’s ownership or operation of such assets may not be tax-exempt. In addition, a Fund’s","page_number":89,"box":{"x":70,"y":468,"width":810,"height":11}},{"id":"a9b2b77e-b34c-448f-8dfd-df0a485ccaaa","block_type":"box","text":"intention to qualify as a “regulated investment company” under the Code, may limit the extent to which a Fund may","page_number":89,"box":{"x":70,"y":483,"width":820,"height":11}},{"id":"442b9a68-a204-45f3-b4ff-c0f50398834d","block_type":"box","text":"exercise its rights by taking possession of such assets, because as a regulated investment company a Fund is","page_number":89,"box":{"x":69,"y":498,"width":790,"height":11}},{"id":"5699365a-3add-42a4-981f-882ca135a79a","block_type":"box","text":"subject to certain limitations on its investments and on the nature of its income.","page_number":89,"box":{"x":69,"y":513,"width":574,"height":11}},{"id":"8a85d6c3-3132-4e85-b271-bafa6775fc71","block_type":"box","text":"Tender Option Bonds.","page_number":89,"box":{"x":103,"y":536,"width":150,"height":11}},{"id":"c9027300-bfde-4310-a8f8-dc50101d15c4","block_type":"box","text":"Certain Funds may invest in residual inverse floating rate interest tender option bonds","page_number":89,"box":{"x":260,"y":536,"width":613,"height":11}},{"id":"84164373-a434-41e4-baa8-90ed43899ca3","block_type":"box","text":"(“TOB Residuals”), which are derivative interests in Municipal Bonds. The TOB Residuals in which the Funds will","page_number":89,"box":{"x":69,"y":551,"width":796,"height":11}},{"id":"7c7e9d82-bfb6-469f-a83c-f8de050487cd","block_type":"box","text":"invest pay interest or income that, in the opinion of counsel to the issuer, is exempt from regular U.S. federal income","page_number":89,"box":{"x":70,"y":566,"width":834,"height":11}},{"id":"0f1df0ad-9636-4b5d-927a-70cc1090f2b9","block_type":"box","text":"tax. BlackRock will not conduct its own analysis of the tax status of the interest or income paid by TOB Residuals","page_number":89,"box":{"x":68,"y":581,"width":807,"height":11}},{"id":"3623d23c-b1ad-42da-ba4d-968124f52c1b","block_type":"box","text":"held by the Funds, but will rely on the opinion of counsel to the issuer. Although volatile, TOB Residuals typically offer","page_number":89,"box":{"x":69,"y":596,"width":836,"height":12}},{"id":"6045d33c-9d9b-4507-b971-32f1473b6802","block_type":"box","text":"the potential for yields exceeding the yields available on fixed rate Municipal Bonds with comparable credit quality.","page_number":89,"box":{"x":68,"y":612,"width":814,"height":11}},{"id":"4cf09437-7c66-4874-957a-1073d9b2eb92","block_type":"box","text":"The Funds may invest in TOB Residuals for the purpose of using economic leverage.","page_number":89,"box":{"x":68,"y":627,"width":598,"height":11}},{"id":"7844a869-a6fe-4cde-b264-577ea4db774e","block_type":"box","text":"TOB Residuals represent beneficial interests in a special purpose trust formed for the purpose of holding","page_number":89,"box":{"x":101,"y":649,"width":751,"height":12}},{"id":"2f84c1d8-ed0e-4e72-ad40-294c078d1ab6","block_type":"box","text":"Municipal Bonds contributed by one or more funds (a “TOB Trust”). A TOB Trust typically issues two classes of","page_number":89,"box":{"x":70,"y":664,"width":786,"height":12}},{"id":"58aaa772-75d0-4a5f-9d9a-0344686581d8","block_type":"box","text":"beneficial interests: short-term floating rate interests (“TOB Floaters”), which are sold to third-party investors, and","page_number":89,"box":{"x":69,"y":680,"width":813,"height":11}},{"id":"9903fb56-6fe1-4864-916a-fd116b5087cd","block_type":"box","text":"TOB Residuals, which are generally issued to the fund(s) that transferred Municipal Bonds to the TOB Trust. The","page_number":89,"box":{"x":68,"y":695,"width":799,"height":11}},{"id":"a4c14310-7e81-45b4-a13c-405912f1beaa","block_type":"box","text":"Funds may invest in both TOB Floaters and TOB Residuals. TOB Floaters may have first priority on the cash flow from","page_number":89,"box":{"x":70,"y":710,"width":830,"height":11}},{"id":"afd885e4-fe91-4577-a313-ec566bee7534","block_type":"box","text":"the Municipal Bonds held by the TOB Trust and are enhanced with a liquidity support arrangement from a third-party","page_number":89,"box":{"x":68,"y":725,"width":828,"height":11}},{"id":"b4a4ce56-d0c5-4af6-a4bc-6518e5f43dc9","block_type":"box","text":"Liquidity Provider (defined below) which allows holders to tender their position at par (plus accrued interest). A Fund,","page_number":89,"box":{"x":70,"y":740,"width":826,"height":11}},{"id":"1ed9abc4-2d5d-4b1b-8923-475be858b261","block_type":"box","text":"as a holder of TOB Residuals, is paid the residual cash flow from the TOB Trust. A Fund that contributes the","page_number":89,"box":{"x":69,"y":755,"width":768,"height":11}},{"id":"f8799e73-36c0-41b2-af9f-8569a084d7cb","block_type":"box","text":"Municipal Bonds to the TOB Trust is paid the cash received by the TOB Trust from the sale of the TOB Floaters, less","page_number":89,"box":{"x":70,"y":770,"width":825,"height":11}},{"id":"940e321f-3a50-4590-a38b-d33394a1a98e","block_type":"box","text":"certain transaction costs, and typically will invest the cash to purchase additional Municipal Bonds or other","page_number":89,"box":{"x":69,"y":786,"width":764,"height":11}},{"id":"74d4fba9-fde4-4e50-a965-74c23e4f9457","block_type":"box","text":"investments permitted by its investment policies. If a Fund ever purchases all or a portion of the TOB Floaters sold by","page_number":89,"box":{"x":70,"y":801,"width":838,"height":11}},{"id":"83556542-ea55-4bdf-8232-a45a011cc853","block_type":"box","text":"the TOB Trust, it may surrender those TOB Floaters together with a proportionate amount of TOB Residuals to the","page_number":89,"box":{"x":68,"y":816,"width":810,"height":11}},{"id":"3da05797-5f54-4549-b793-37e0a7283bb4","block_type":"box","text":"TOB Trust in exchange for a proportionate amount of the Municipal Bonds owned by the TOB Trust.","page_number":89,"box":{"x":68,"y":831,"width":704,"height":11}},{"id":"56853177-5e79-40a1-9bf2-43fee6bfc50e","block_type":"box","text":"Other BlackRock-advised funds may contribute Municipal Bonds to a TOB Trust into which a Fund has contributed","page_number":89,"box":{"x":102,"y":853,"width":804,"height":12}},{"id":"ee4300ef-5028-45f2-82f5-8e4d061bcc57","block_type":"box","text":"Municipal Bonds. If multiple BlackRock-advised funds participate in the same TOB Trust, the economic rights and","page_number":89,"box":{"x":70,"y":869,"width":805,"height":11}},{"id":"386fa857-6e64-46a2-85df-35ef6d69514a","block_type":"box","text":"obligations under the TOB Residual will generally be shared among the funds ratably in proportion to their","page_number":89,"box":{"x":69,"y":884,"width":752,"height":11}},{"id":"d5ff813d-d5db-48d3-9b97-d60ab98e05d9","block_type":"box","text":"participation in the TOB Trust.","page_number":89,"box":{"x":70,"y":899,"width":211,"height":11}},{"id":"b9630870-04ca-4c22-af1d-24fcd0413d72","block_type":"box","text":"II-58","page_number":89,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"c94acac1-3417-4f92-ae34-e343846b4099","block_type":"box","text":"NM0926U-5977317-89/232","page_number":89,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"27abf76d-2405-4462-b1d3-53db5081bc19","block_type":"box","text":"The Municipal Bonds transferred to a TOB Trust typically are high grade Municipal Bonds. In certain cases, when","page_number":90,"box":{"x":101,"y":45,"width":802,"height":11}},{"id":"0d12d9a0-4f4d-4735-a93a-58885bcb3a37","block_type":"box","text":"Municipal Bonds transferred are lower grade Municipal Bonds, the TOB Trust transaction includes a credit","page_number":90,"box":{"x":70,"y":60,"width":753,"height":11}},{"id":"5ae2a3cc-25a7-496f-98c5-f3296e63a0f8","block_type":"box","text":"enhancement feature that provides for the timely payment of principal and interest on the bonds to the TOB Trust by","page_number":90,"box":{"x":69,"y":75,"width":829,"height":11}},{"id":"ac189abf-9a88-411c-8d65-ce1ba3ef1bbd","block_type":"box","text":"a credit enhancement provider. The TOB Trust would be responsible for the payment of the credit enhancement fee","page_number":90,"box":{"x":69,"y":90,"width":819,"height":11}},{"id":"ec1aecdc-9a1f-4ea6-836a-a80ed08bb76f","block_type":"box","text":"and a Fund, as a TOB Residual holder, would be responsible for reimbursement of any payments of principal and","page_number":90,"box":{"x":69,"y":105,"width":802,"height":11}},{"id":"b9bedfb2-dbe2-4a5e-b1f6-ec128860df20","block_type":"box","text":"interest made by the credit enhancement provider.","page_number":90,"box":{"x":70,"y":120,"width":357,"height":11}},{"id":"c68d2c68-a66b-47c8-990e-937555980917","block_type":"box","text":"The TOB Residuals held by a Fund generally provide the Fund with the right to cause the holders of a proportional","page_number":90,"box":{"x":101,"y":143,"width":807,"height":11}},{"id":"01d2a5e7-8b93-4599-a118-8b010f5a6ba5","block_type":"box","text":"share of the TOB Floaters to tender their notes to the TOB Trust at par plus accrued interest. Thereafter, the Fund","page_number":90,"box":{"x":69,"y":158,"width":810,"height":11}},{"id":"8fd504c3-5741-427a-a281-e05cff7ac0b9","block_type":"box","text":"may withdraw a corresponding share of the Municipal Bonds from the TOB Trust. This transaction, in effect, creates","page_number":90,"box":{"x":69,"y":173,"width":825,"height":11}},{"id":"3d6ad761-ec3a-42fc-ab45-a14f57be1a70","block_type":"box","text":"exposure for the Fund to the entire return of the Municipal Bonds in the TOB Trust, with a net cash investment by the","page_number":90,"box":{"x":69,"y":188,"width":834,"height":11}},{"id":"1f62dd41-1cea-48d2-abc0-e54974f466ce","block_type":"box","text":"Fund that is less than the value of the Municipal Bonds in the TOB Trust. This multiplies the positive or negative","page_number":90,"box":{"x":70,"y":203,"width":797,"height":12}},{"id":"1cc918c5-13b9-412c-aa35-50db0cc99bf0","block_type":"box","text":"impact of the Municipal Bonds’ return within the Fund (thereby creating leverage). The leverage within a TOB Trust","page_number":90,"box":{"x":70,"y":218,"width":809,"height":12}},{"id":"cdf66cd0-aa83-4706-b5d4-4cc0cf8dbe0e","block_type":"box","text":"depends on the value of the Municipal Bonds deposited in the TOB Trust relative to the value of the TOB Floaters it","page_number":90,"box":{"x":69,"y":234,"width":820,"height":11}},{"id":"6b60f351-c660-481b-912f-fa0dac345d39","block_type":"box","text":"issues.","page_number":90,"box":{"x":70,"y":249,"width":49,"height":9}},{"id":"bc0274c3-1a90-4664-b69b-e5008d88e2e4","block_type":"box","text":"A Fund may invest in highly leveraged TOB Residuals. A TOB Residual generally is considered highly leveraged if","page_number":90,"box":{"x":101,"y":271,"width":795,"height":12}},{"id":"f0f85596-eb88-4a55-84e9-a815afa25e4c","block_type":"box","text":"the principal amount of the TOB Floaters issued by the related TOB Trust exceeds 75% of the principal amount of the","page_number":90,"box":{"x":68,"y":286,"width":833,"height":12}},{"id":"2e6a0a43-3a3a-46e2-8677-b490148eb5cb","block_type":"box","text":"Municipal Bonds owned by the TOB Trust.","page_number":90,"box":{"x":70,"y":302,"width":293,"height":11}},{"id":"776293f6-af44-49ae-a8d8-ad0aa74ec20b","block_type":"box","text":"The TOB Trust may be collapsed without the consent of a Fund upon the occurrence of tender option termination","page_number":90,"box":{"x":101,"y":324,"width":802,"height":11}},{"id":"b8995496-905c-4a04-9cec-332644a5ab5f","block_type":"box","text":"events (“TOTEs”) and mandatory termination events (“MTEs”), as defined in the TOB Trust agreements. TOTEs","page_number":90,"box":{"x":69,"y":339,"width":788,"height":12}},{"id":"964812df-f1b3-43df-ac07-d7fd4221c460","block_type":"box","text":"include the bankruptcy or default of the issuer of the Municipal Bonds held in the TOB Trust, a substantial downgrade","page_number":90,"box":{"x":70,"y":355,"width":836,"height":11}},{"id":"129a88a5-7416-4e13-90a1-aac907d0ca89","block_type":"box","text":"in the credit quality of the issuer of the Municipal Bonds held in the TOB Trust, failure of any scheduled payment of","page_number":90,"box":{"x":70,"y":370,"width":819,"height":11}},{"id":"f323054f-86b5-4c51-bccf-a0a963a5fb00","block_type":"box","text":"principal or interest on the Municipal Bonds, and a judgment or ruling that interest on the Municipal Bonds is subject","page_number":90,"box":{"x":70,"y":385,"width":833,"height":11}},{"id":"0d223f17-8bd7-4bf6-8493-bedd5e8ea104","block_type":"box","text":"to U.S. federal income taxation. MTEs may include, among other things, a failed remarketing of the TOB Floaters, the","page_number":90,"box":{"x":68,"y":400,"width":834,"height":11}},{"id":"fc2e290a-beec-4c54-b33e-f8860166cec2","block_type":"box","text":"inability of the TOB Trust to obtain renewal of the liquidity support agreement, and a substantial decline in the market","page_number":90,"box":{"x":70,"y":415,"width":838,"height":11}},{"id":"3d05210e-22b4-4075-a592-ddf36d3a9c73","block_type":"box","text":"value of the Municipal Bonds held in the TOB Trust. Upon the occurrence of a TOTE or an MTE, a TOB Trust would be","page_number":90,"box":{"x":68,"y":430,"width":831,"height":11}},{"id":"31d10683-b148-427b-9eed-7d2b3c9ea469","block_type":"box","text":"liquidated with the proceeds applied first to any accrued fees owed to the trustee of the TOB Trust, the remarketing","page_number":90,"box":{"x":70,"y":445,"width":823,"height":12}},{"id":"fabc340d-87a1-462f-bb33-66b3848f084a","block_type":"box","text":"agent of the TOB Floaters and the Liquidity Provider (defined below). In the case of an MTE, after the payment of fees,","page_number":90,"box":{"x":69,"y":460,"width":839,"height":12}},{"id":"a4054b89-c5bc-4964-a392-aeb8adda8bc1","block_type":"box","text":"the holders of the TOB Floaters would be paid senior to the TOB Residual holders (","page_number":90,"box":{"x":68,"y":475,"width":589,"height":12}},{"id":"5b506792-4a77-4cd0-823d-771858f78903","block_type":"box","text":"i.e.","page_number":90,"box":{"x":659,"y":476,"width":21,"height":8}},{"id":"b3a58c72-b3fa-467b-8cf0-7c14dc837345","block_type":"box","text":", the Fund). In contrast, in the","page_number":90,"box":{"x":682,"y":476,"width":211,"height":11}},{"id":"a9439a23-abda-4bd5-a696-08676ebc20a1","block_type":"box","text":"case of a TOTE, after payment of fees, the holders of TOB Floaters and the TOB Residual holders would be paid pro","page_number":90,"box":{"x":69,"y":491,"width":822,"height":11}},{"id":"172364a3-2c39-410a-96bd-3f67355549dd","block_type":"box","text":"rata in proportion to the respective face values of their certificates.","page_number":90,"box":{"x":69,"y":506,"width":479,"height":11}},{"id":"0430e876-b602-4f78-a6f2-49976442f8ff","block_type":"box","text":"A Fund may invest in a TOB Trust on either a non-recourse or recourse basis. TOB Trusts are typically supported","page_number":90,"box":{"x":101,"y":529,"width":797,"height":11}},{"id":"68d821cd-51f2-4cfa-a0ab-fa12ac570b7a","block_type":"box","text":"by a liquidity facility provided by a third-party bank or other financial institution (the “Liquidity Provider”) that allows","page_number":90,"box":{"x":69,"y":543,"width":815,"height":12}},{"id":"b2e6fb73-9de7-4208-952f-02b87de6f6ac","block_type":"box","text":"the holders of the TOB Floaters to tender their TOB Floaters in exchange for payment of par plus accrued interest on","page_number":90,"box":{"x":68,"y":559,"width":828,"height":11}},{"id":"66b778d3-3075-4847-9f60-56ccc6a07ab7","block_type":"box","text":"any business day (subject to the non-occurrence of a TOTE described above). Depending on the structure of the TOB","page_number":90,"box":{"x":69,"y":574,"width":828,"height":11}},{"id":"95cc85a6-a0e6-4b98-b74c-9c78f74550d7","block_type":"box","text":"Trust, the Liquidity Provider may purchase the tendered TOB Floaters, or the TOB Trust may draw upon a loan from","page_number":90,"box":{"x":68,"y":589,"width":815,"height":11}},{"id":"5c30dcd6-2303-49f2-8fbb-89170acc1e32","block_type":"box","text":"the Liquidity Provider to purchase the tendered TOB Floaters.","page_number":90,"box":{"x":68,"y":604,"width":434,"height":11}},{"id":"0e50a02f-c790-48f7-88b9-25b54865486b","block_type":"box","text":"When a Fund invests in TOB Trusts on a non-recourse basis, and the Liquidity Provider is required to make a","page_number":90,"box":{"x":101,"y":627,"width":772,"height":11}},{"id":"2d294b54-72a4-4501-921a-2cbb60fa9b70","block_type":"box","text":"payment under the liquidity facility, the Liquidity Provider will typically liquidate all or a portion of the Municipal Bonds","page_number":90,"box":{"x":70,"y":642,"width":831,"height":11}},{"id":"2f74e691-68b9-4654-80f0-145142745b69","block_type":"box","text":"held in the TOB Trust and then fund the balance, if any, of the amount owed under the liquidity facility over the","page_number":90,"box":{"x":69,"y":657,"width":785,"height":11}},{"id":"44cbb0df-0ca8-47bf-a4ff-7559eac08f72","block_type":"box","text":"liquidation proceeds (the “Liquidation Shortfall”). If a Fund invests in a TOB Trust on a recourse basis, it will typically","page_number":90,"box":{"x":70,"y":672,"width":831,"height":11}},{"id":"fd4bfd40-864d-499a-8e3a-0056627e7e44","block_type":"box","text":"enter into a reimbursement agreement with the Liquidity Provider pursuant to which the Fund is required to reimburse","page_number":90,"box":{"x":69,"y":687,"width":836,"height":11}},{"id":"fd6de6b4-b9ed-43a0-865d-d5dffc2f3f9d","block_type":"box","text":"the Liquidity Provider the amount of any Liquidation Shortfall. As a result, if the Fund invests in a recourse TOB Trust,","page_number":90,"box":{"x":68,"y":702,"width":836,"height":11}},{"id":"25fee446-c7dc-4927-a23f-8a7b2a70f04c","block_type":"box","text":"the Fund will bear the risk of loss with respect to any Liquidation Shortfall. If multiple BlackRock-advised funds","page_number":90,"box":{"x":68,"y":717,"width":788,"height":12}},{"id":"056bd364-3e3a-4cd4-b77d-53d55b5863a2","block_type":"box","text":"participate in any such TOB Trust, these losses will be shared ratably, in proportion to their participation in the TOB","page_number":90,"box":{"x":70,"y":733,"width":823,"height":11}},{"id":"f64af3d2-c39f-4e20-95b9-6ca516517a58","block_type":"box","text":"Trust.","page_number":90,"box":{"x":68,"y":748,"width":39,"height":9}},{"id":"fe767844-adb7-4c20-bf5e-5b523bf972c5","block_type":"box","text":"Under accounting rules, Municipal Bonds of a Fund that are deposited into a TOB Trust are investments of the","page_number":90,"box":{"x":102,"y":770,"width":784,"height":12}},{"id":"5249cc22-dcee-46c3-b4aa-2c679d5236ed","block_type":"box","text":"Fund and are presented on the Fund’s Schedule of Investments and outstanding TOB Floaters issued by a TOB Trust","page_number":90,"box":{"x":70,"y":785,"width":830,"height":12}},{"id":"87223b01-f161-407c-97d5-03270dfb0a98","block_type":"box","text":"are presented as liabilities in the Fund’s Statement of Assets and Liabilities. Interest income from the underlying","page_number":90,"box":{"x":69,"y":801,"width":806,"height":11}},{"id":"725c2573-e992-48e0-8345-f6c8e56cd8c2","block_type":"box","text":"Municipal Bonds is recorded by a Fund on an accrual basis. Interest expense incurred on the TOB Floaters and other","page_number":90,"box":{"x":70,"y":816,"width":831,"height":11}},{"id":"2ad37e45-9d9e-41e1-bca6-2def7e4b48e2","block_type":"box","text":"expenses related to remarketing, administration, trustee and other services to a TOB Trust are reported as expenses","page_number":90,"box":{"x":69,"y":831,"width":837,"height":11}},{"id":"f1eea404-7c87-414b-91b3-635b720bed42","block_type":"box","text":"of a Fund. In addition, under accounting rules, loans made to a TOB Trust sponsored by a Fund may be presented as","page_number":90,"box":{"x":69,"y":846,"width":832,"height":11}},{"id":"93fc4424-d718-4bd4-a312-be959165f546","block_type":"box","text":"loans of the Fund in the Fund’s financial statements even if there is no recourse to the Fund’s assets.","page_number":90,"box":{"x":70,"y":861,"width":728,"height":9}},{"id":"ec8a2fdb-5798-461f-aa58-82e612a45284","block_type":"box","text":"For TOB Floaters, generally, the interest rate earned will be based upon the market rates for Municipal Bonds","page_number":90,"box":{"x":102,"y":884,"width":776,"height":11}},{"id":"9e968ffd-6f56-4b17-bfc5-c1284328e0ed","block_type":"box","text":"with maturities or remarketing provisions that are comparable in duration to the periodic interval of the tender option.","page_number":90,"box":{"x":68,"y":899,"width":837,"height":11}},{"id":"338788e7-b6ae-4ab3-a7d8-e6d14a146d7e","block_type":"box","text":"II-59","page_number":90,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"d24fa830-267d-45d0-baec-0ee42ca056e0","block_type":"box","text":"NM0926U-5977317-90/232","page_number":90,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"8c1ee6a2-297f-43c4-93b1-494bab13e1b1","block_type":"box","text":"Since the tender option feature has a shorter term than the final maturity or first call date of the underlying Municipal","page_number":91,"box":{"x":69,"y":45,"width":836,"height":11}},{"id":"44016e09-39ed-4d1f-beee-453c165ee8dc","block_type":"box","text":"Bonds deposited in the TOB Trust, the holder of the TOB Floaters relies upon the terms of the agreement with the","page_number":91,"box":{"x":70,"y":60,"width":809,"height":11}},{"id":"fab54c3c-83ba-48d8-bb0e-e75bc5af9d97","block_type":"box","text":"financial institution furnishing the liquidity facility as well as the credit strength of that institution. The risk associated","page_number":91,"box":{"x":68,"y":75,"width":836,"height":11}},{"id":"ef2359ca-28f3-46af-a057-034ae854ba24","block_type":"box","text":"with TOB Floaters, however, may be increased in the current market environment as a result of recent downgrades to","page_number":91,"box":{"x":68,"y":90,"width":835,"height":11}},{"id":"53bf4d72-c760-4713-9901-a4df52d3d291","block_type":"box","text":"the credit ratings, and thus the perceived reliability and creditworthiness, of many major financial institutions, some","page_number":91,"box":{"x":68,"y":105,"width":827,"height":11}},{"id":"88575fb5-546f-4235-a748-16d7632e9536","block_type":"box","text":"of which sponsor and/or provide liquidity support to TOB Trusts. This in turn may reduce the desirability of TOB","page_number":91,"box":{"x":69,"y":120,"width":790,"height":11}},{"id":"e1093400-ae18-43f4-8c39-ed5bc0e8b293","block_type":"box","text":"Floaters as investments, which could impair the viability or availability of TOB Trusts.","page_number":91,"box":{"x":70,"y":135,"width":599,"height":11}},{"id":"b95e76e3-7677-41f3-b3de-b6979881f5fd","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into TOB Trust transactions, reverse","page_number":91,"box":{"x":102,"y":158,"width":762,"height":11}},{"id":"110fbb34-d7d3-4501-82a7-b9468274b4c1","block_type":"box","text":"repurchase agreements and similar financing transactions (e.g., borrowed bonds) notwithstanding the limitation on","page_number":91,"box":{"x":69,"y":173,"width":818,"height":11}},{"id":"6adaf517-1fc1-44a4-8991-1e1910d0427d","block_type":"box","text":"the issuance of senior securities in Section 18 of the Investment Company Act, provided that the Fund either","page_number":91,"box":{"x":68,"y":188,"width":778,"height":11}},{"id":"fe890c89-0eec-4448-93a3-1d58f36d75f8","block_type":"box","text":"(i) complies with the 300% asset coverage ratio with respect to such transactions and any other borrowings in the","page_number":91,"box":{"x":69,"y":203,"width":811,"height":12}},{"id":"451f3009-d083-4c70-a0a2-f2a84e73e838","block_type":"box","text":"aggregate, or (ii) treats such transactions as Derivatives Transactions under Rule 18f-4. See “—Derivatives —","page_number":91,"box":{"x":69,"y":218,"width":786,"height":12}},{"id":"40e71390-d99b-49b6-b67f-2bb7b65bc774","block_type":"box","text":"Regulation of Derivatives — Rule 18f-4 under the Investment Company Act” above.","page_number":91,"box":{"x":70,"y":234,"width":588,"height":11}},{"id":"d29f40f9-f96f-4915-8f72-4f90e82874e0","block_type":"box","text":"Developments in the TOB Trust Market.","page_number":91,"box":{"x":102,"y":256,"width":279,"height":11}},{"id":"3358cc75-33e6-414c-a8c6-d628c0606bad","block_type":"box","text":"In response to the restrictions imposed by section 619 of the Dodd-Frank Wall Street Reform and Consumer","page_number":91,"box":{"x":102,"y":279,"width":771,"height":11}},{"id":"a54b75d8-8682-4c70-9e53-183f401f3f89","block_type":"box","text":"Protection Act (the “Volcker Rule”), market participants have developed a structure for TOB Trusts designed to","page_number":91,"box":{"x":69,"y":294,"width":786,"height":11}},{"id":"d43e5e07-c9c0-414e-aa5d-e17e768610e5","block_type":"box","text":"ensure that no banking entity is sponsoring the TOB Trust for purposes of the Volcker Rule. Specifically, a Fund will","page_number":91,"box":{"x":69,"y":309,"width":816,"height":11}},{"id":"1268ed46-f9c4-4a1c-9bd1-353e9d72c567","block_type":"box","text":"establish, structure and “sponsor” the TOB Trusts in which it holds TOB Residuals. In such a structure, certain","page_number":91,"box":{"x":69,"y":324,"width":791,"height":11}},{"id":"ae1c8db1-7649-4167-8884-ff0d28f0eab5","block_type":"box","text":"responsibilities that previously belonged to the sponsor bank will be performed by, or on behalf of, a Fund. A Fund","page_number":91,"box":{"x":69,"y":339,"width":812,"height":12}},{"id":"547f5925-366d-4da6-b84c-d478c49b30b8","block_type":"box","text":"may utilize service providers in meeting these responsibilities. It is possible that regulators could take positions that","page_number":91,"box":{"x":69,"y":355,"width":832,"height":11}},{"id":"c35267d5-c059-4707-8b7a-541f4562ee95","block_type":"box","text":"could limit the market for such structured TOB Trust transactions or a Fund’s ability to hold TOB Residuals. Under","page_number":91,"box":{"x":69,"y":370,"width":810,"height":11}},{"id":"81c17963-2484-4a1c-87a4-adeea2cba6fe","block_type":"box","text":"this TOB Trust structure, a Fund has certain additional duties and responsibilities, which may give rise to certain","page_number":91,"box":{"x":68,"y":385,"width":803,"height":11}},{"id":"e175d53c-da11-4c77-85d2-622cac8ba062","block_type":"box","text":"additional risks including, but not limited to, compliance, securities law and operational risks.","page_number":91,"box":{"x":69,"y":400,"width":665,"height":11}},{"id":"d71f9cae-03be-4a7c-be85-1c2b5f5be2a0","block_type":"box","text":"Under this structure, service providers to a TOB Trust, such as administrators, liquidity providers, trustees, and","page_number":91,"box":{"x":102,"y":423,"width":793,"height":11}},{"id":"b821edf1-a70d-4159-9648-db02c3e36b35","block_type":"box","text":"remarketing agents, act at the direction of, and as agent of, a Fund as the TOB Residual holder. Similar to the","page_number":91,"box":{"x":69,"y":438,"width":783,"height":11}},{"id":"d50ef504-e048-45e7-9b5c-9b4dced63ec4","block_type":"box","text":"traditional tender option bond structure, a Fund deposits Municipal Bonds into the TOB Trust in exchange for TOB","page_number":91,"box":{"x":68,"y":453,"width":808,"height":11}},{"id":"53910847-6f06-42e5-add8-689c613e29f7","block_type":"box","text":"Residuals, the TOB Trust then issues and sells TOB Floaters to third-party investors, and the proceeds of the sale of","page_number":91,"box":{"x":70,"y":468,"width":830,"height":11}},{"id":"d6ff9649-11ac-455f-bcea-0eeb61a8cd9b","block_type":"box","text":"the TOB Floaters is distributed to such TOB Residual holders (","page_number":91,"box":{"x":68,"y":483,"width":442,"height":11}},{"id":"b2c7d602-2523-4e65-942e-4f6fd0e1b53a","block_type":"box","text":"i.e.","page_number":91,"box":{"x":512,"y":483,"width":20,"height":9}},{"id":"7876c187-33f2-467a-998b-f2cd0423fa73","block_type":"box","text":", the Fund). Tendered TOB Floaters continue to be","page_number":91,"box":{"x":535,"y":483,"width":352,"height":11}},{"id":"38cb85e5-a40c-4103-812e-cb58ffb7de06","block_type":"box","text":"supported by a remarketing agent and a liquidity facility. However, the remarketing agent does not purchase tendered","page_number":91,"box":{"x":69,"y":498,"width":836,"height":11}},{"id":"36763077-adf3-4694-ae99-2c39c3d60d3d","block_type":"box","text":"TOB Floaters for its own account in the event of a failed remarketing, which may increase the likelihood that a TOB","page_number":91,"box":{"x":68,"y":513,"width":816,"height":12}},{"id":"2e51517d-f67c-49b6-8412-c4e62a0f3ca7","block_type":"box","text":"Trust will need to be collapsed and liquidated in order to purchase the tendered TOB Floaters. In the event of a failed","page_number":91,"box":{"x":68,"y":528,"width":835,"height":11}},{"id":"e6398ba7-6767-44ed-a7cc-d8c48327ea5e","block_type":"box","text":"remarketing of TOB Floaters, the Liquidity Provider, at its option, may advance a loan to the TOB Trust the proceeds","page_number":91,"box":{"x":69,"y":543,"width":822,"height":12}},{"id":"451f45a9-9012-4b20-a710-4ff7e0734b1b","block_type":"box","text":"of which would be used by the TOB Trust to purchase the tendered TOB Floaters. The Liquidity Provider is not","page_number":91,"box":{"x":69,"y":559,"width":777,"height":11}},{"id":"e85c2756-1513-4772-b4ea-6a19d1e4cead","block_type":"box","text":"obligated to advance such a loan. The TOB Trust would be the borrower with respect to any such loan. Any loans","page_number":91,"box":{"x":69,"y":574,"width":800,"height":11}},{"id":"ff2d7cd7-726e-4817-86b1-aa5655fe2c14","block_type":"box","text":"made by a Liquidity Provider will be secured by the purchased TOB Floaters held by the TOB Trust.","page_number":91,"box":{"x":69,"y":589,"width":696,"height":11}},{"id":"5c998b01-4772-4399-96db-813d3dac6809","block_type":"box","text":"Similar to the traditional structure for TOB Trusts, a Fund may hold either non-recourse TOB Residuals or","page_number":91,"box":{"x":102,"y":612,"width":745,"height":11}},{"id":"9a6836e3-701e-4735-890e-839128ecf76d","block_type":"box","text":"recourse TOB Residuals under this structure. In the event of a Liquidation Shortfall, there would generally be no","page_number":91,"box":{"x":69,"y":627,"width":797,"height":11}},{"id":"47adbaa1-334f-4525-aa51-a3f8d9070995","block_type":"box","text":"contractual recourse to the Fund’s assets if the Fund holds a non-recourse TOB Residual. However, as described","page_number":91,"box":{"x":69,"y":642,"width":803,"height":10}},{"id":"8d169888-d2e0-4f2d-9ad8-cb7da974938e","block_type":"box","text":"above, a Fund would bear the risk of loss with respect to any Liquidation Shortfall if it holds a recourse TOB Residual.","page_number":91,"box":{"x":69,"y":657,"width":838,"height":11}},{"id":"d1a3d6d8-9004-4879-8779-fd4dcfb76538","block_type":"box","text":"The SEC and various federal banking and housing agencies adopted credit risk retention rules for securitizations","page_number":91,"box":{"x":101,"y":680,"width":801,"height":11}},{"id":"1951a8d7-f01f-444c-a6bf-f4ebb710db7c","block_type":"box","text":"(the “Risk Retention Rules”), which took effect in December 2016. The Risk Retention Rules require the sponsor of a","page_number":91,"box":{"x":69,"y":695,"width":838,"height":11}},{"id":"b1e57363-765b-4b34-9dd2-462a342eb260","block_type":"box","text":"TOB Trust to retain at least 5% of the credit risk of the underlying assets supporting the TOB Trust’s Municipal","page_number":91,"box":{"x":68,"y":710,"width":787,"height":11}},{"id":"8146ef92-fdea-4e16-b4f7-220a6eb85e92","block_type":"box","text":"Bonds. The Risk Retention Rules may adversely affect the Fund’s ability to engage in TOB Trust transactions or","page_number":91,"box":{"x":70,"y":725,"width":791,"height":11}},{"id":"ed2635bd-2ebd-434a-bdf3-fcec15af5f74","block_type":"box","text":"increase the costs of such transactions in certain circumstances.","page_number":91,"box":{"x":70,"y":740,"width":466,"height":9}},{"id":"50b59254-3bfd-4f20-a882-e064b7e4d9ba","block_type":"box","text":"TOB Trust transactions constitute an important component of the municipal bond market. Accordingly,","page_number":91,"box":{"x":101,"y":763,"width":726,"height":11}},{"id":"a76cebf8-3a3a-4dd1-936f-9300176d823f","block_type":"box","text":"implementation of the Volcker Rule may adversely impact the municipal market, including through reduced demand","page_number":91,"box":{"x":70,"y":778,"width":816,"height":11}},{"id":"f2e19cfb-7201-49ee-8b66-f9595d340330","block_type":"box","text":"for and liquidity of municipal bonds and increased financing costs for municipal issuers. Any such developments","page_number":91,"box":{"x":68,"y":793,"width":799,"height":11}},{"id":"6601bfb5-c61b-49d7-8aa2-5c4be6e3d698","block_type":"box","text":"could adversely affect the Funds. The ultimate impact of these rules on the TOB market and the overall municipal","page_number":91,"box":{"x":69,"y":808,"width":807,"height":11}},{"id":"20a431e5-a2c1-4ae6-aa44-372ffc8aa66c","block_type":"box","text":"market is not yet certain.","page_number":91,"box":{"x":69,"y":823,"width":178,"height":11}},{"id":"456c8ac5-429a-4cbc-a948-d35b9321c415","block_type":"box","text":"Yields.","page_number":91,"box":{"x":103,"y":846,"width":45,"height":9}},{"id":"41c7545a-6c54-457c-bd64-3680f756aaea","block_type":"box","text":"Yields on Municipal Bonds are dependent on a variety of factors, including the general condition of the","page_number":91,"box":{"x":154,"y":846,"width":730,"height":11}},{"id":"a0170ee7-2edc-4c4c-b24b-0dd39dcb3828","block_type":"box","text":"money market and of the municipal bond market, the size of a particular offering, the financial condition of the","page_number":91,"box":{"x":69,"y":861,"width":788,"height":11}},{"id":"684662be-ba91-4548-929d-9fd9468b6cba","block_type":"box","text":"issuer, the maturity of the obligation and the rating of the issue. The ability of a Fund to achieve its investment","page_number":91,"box":{"x":70,"y":876,"width":787,"height":11}},{"id":"e4cc95f4-b763-41b4-b8ce-53b29151b47b","block_type":"box","text":"objective is also dependent on the continuing ability of the issuers of the securities in which the Fund invests to meet","page_number":91,"box":{"x":69,"y":891,"width":838,"height":12}},{"id":"430d63d8-4794-4da9-81c5-d37df45de267","block_type":"box","text":"their obligations for the payment of interest and principal when due. There are variations in the risks involved in","page_number":91,"box":{"x":68,"y":906,"width":794,"height":12}},{"id":"a0e75ba3-16a7-43af-8fb3-cea7c74e5276","block_type":"box","text":"II-60","page_number":91,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"39a986d8-5ba3-4cdf-ab05-0d6aa81a087d","block_type":"box","text":"NM0926U-5977317-91/232","page_number":91,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"13687487-81c9-490b-9d15-30872a937ffb","block_type":"box","text":"holding Municipal Bonds, both within a particular classification and between classifications, depending on numerous","page_number":92,"box":{"x":69,"y":45,"width":831,"height":11}},{"id":"035748c5-6781-4c3f-8c77-87b850e3d857","block_type":"box","text":"factors. Furthermore, the rights of owners of Municipal Bonds and the obligations of the issuer of such Municipal","page_number":92,"box":{"x":68,"y":60,"width":806,"height":11}},{"id":"d32ff0b6-bc5e-4978-b6de-c9c3940fbf2f","block_type":"box","text":"Bonds may be subject to applicable bankruptcy, insolvency and similar laws and court decisions affecting the rights","page_number":92,"box":{"x":70,"y":75,"width":823,"height":11}},{"id":"2797250b-017f-4cb3-bd27-ee83e07379b0","block_type":"box","text":"of creditors generally and to general equitable principles, which may limit the enforcement of certain remedies.","page_number":92,"box":{"x":69,"y":90,"width":790,"height":11}},{"id":"c78fdf81-213a-461e-8512-1793eb0588eb","block_type":"box","text":"Variable Rate Demand Obligations (“VRDOs”).","page_number":92,"box":{"x":103,"y":113,"width":323,"height":11}},{"id":"129c643e-b24a-4e50-b9e8-f32a9696a4c0","block_type":"box","text":"VRDOs are tax-exempt obligations that contain a floating or","page_number":92,"box":{"x":432,"y":113,"width":422,"height":11}},{"id":"99b7ffcd-9687-4aaa-b84e-2440f9a76c7b","block_type":"box","text":"variable interest rate adjustment formula and a right of demand on the part of the holder thereof to receive payment","page_number":92,"box":{"x":68,"y":128,"width":830,"height":11}},{"id":"a0e45d04-c0c7-40c2-a898-9e3a646d0171","block_type":"box","text":"of the unpaid principal balance plus accrued interest upon a short notice period not to exceed seven days.","page_number":92,"box":{"x":69,"y":143,"width":759,"height":11}},{"id":"f0a30c1a-0d20-4fbb-9973-bbd430d8efe4","block_type":"box","text":"There is the possibility that because of default or insolvency the demand feature of VRDOs may not be honored.","page_number":92,"box":{"x":101,"y":166,"width":798,"height":11}},{"id":"835dabbf-1244-4247-8d8f-82624758a4b6","block_type":"box","text":"The interest rates are adjustable at periodic intervals to some prevailing market rate for similar investments, such","page_number":92,"box":{"x":68,"y":181,"width":815,"height":11}},{"id":"bdb0b0ef-c259-421d-93e1-2a6abe8c7d0b","block_type":"box","text":"adjustment formula being calculated to maintain the market rate of the VRDOs at approximately the par value of the","page_number":92,"box":{"x":69,"y":196,"width":826,"height":11}},{"id":"03afbd3c-815b-41dc-ae4e-869f1745e365","block_type":"box","text":"VRDOs on the adjustment date. The adjustments typically are based upon the Securities Industry and Financial","page_number":92,"box":{"x":68,"y":211,"width":791,"height":11}},{"id":"c71f6606-78d6-4c58-89cd-150e28edaa84","block_type":"box","text":"Markets Association (“SIFMA”) Index.","page_number":92,"box":{"x":70,"y":226,"width":264,"height":11}},{"id":"5f044e77-e281-42ea-8be6-9254addb418e","block_type":"box","text":"Because of the interest rate adjustment formula on VRDOs, VRDOs are not comparable to fixed rate securities.","page_number":92,"box":{"x":102,"y":249,"width":791,"height":11}},{"id":"4f6caf51-422a-45b3-a190-469f697935f3","block_type":"box","text":"During periods of declining interest rates, a Fund’s yield on a VRDO will decrease and its shareholders will forego the","page_number":92,"box":{"x":70,"y":264,"width":833,"height":11}},{"id":"97a0d652-0e95-4fd1-8539-fa1b5183a716","block_type":"box","text":"opportunity for capital appreciation. During periods of rising interest rates, however, a Fund’s yield on a VRDO will","page_number":92,"box":{"x":69,"y":279,"width":808,"height":11}},{"id":"1f70856c-b32f-47b2-baab-3411de043c86","block_type":"box","text":"increase and the Fund’s shareholders will have a reduced risk of capital depreciation.","page_number":92,"box":{"x":70,"y":294,"width":608,"height":11}},{"id":"b036793b-3335-44cd-82bb-3fc526c31b18","block_type":"box","text":"Transactions in Financial Futures Contracts on Municipal Indexes.","page_number":92,"box":{"x":103,"y":317,"width":465,"height":11}},{"id":"563ca34e-63eb-47e6-9a28-93291f4f10e7","block_type":"box","text":"The Municipal Funds and certain other funds","page_number":92,"box":{"x":574,"y":317,"width":318,"height":11}},{"id":"c45cdd90-1f15-45a3-9da5-ceda34f61d3d","block_type":"box","text":"deal in financial futures contracts based on a long-term municipal bond index developed by the Chicago Board of","page_number":92,"box":{"x":69,"y":332,"width":803,"height":11}},{"id":"d60a56ee-5774-43e4-a818-0fe144ec556f","block_type":"box","text":"Trade (“CBT”) and The Bond Buyer (the “Municipal Bond Index”). The Municipal Bond Index is comprised of 40 long","page_number":92,"box":{"x":68,"y":347,"width":825,"height":11}},{"id":"9b617b01-622d-437f-8088-aed8f986edfb","block_type":"box","text":"term, actively traded tax-exempt municipal revenue and general obligation bonds. Each bond included in the Municipal","page_number":92,"box":{"x":68,"y":362,"width":840,"height":11}},{"id":"cf314879-cf18-47db-acef-b3902f1b5ae2","block_type":"box","text":"Bond Index must be rated A or higher by Moody’s or S&P and must have a remaining maturity of 19 years or more.","page_number":92,"box":{"x":70,"y":377,"width":815,"height":12}},{"id":"85378689-6e19-4582-838a-37a540b3c022","block_type":"box","text":"Twice a month new issues satisfying the eligibility requirements are added to, and an equal number of old issues are","page_number":92,"box":{"x":68,"y":392,"width":836,"height":12}},{"id":"84310385-5f0a-4c0c-94c1-c0883ed5e21c","block_type":"box","text":"deleted from, the Municipal Bond Index. The value of the Municipal Bond Index is computed daily according to a","page_number":92,"box":{"x":69,"y":407,"width":796,"height":12}},{"id":"0b17c333-77ca-4fcc-8e56-2e5fa530e4c9","block_type":"box","text":"formula based on the price of each bond in the Municipal Bond Index, as evaluated by six dealer-to-dealer brokers.","page_number":92,"box":{"x":68,"y":423,"width":816,"height":11}},{"id":"dbb0644f-dfac-4102-998c-299c2ae987a6","block_type":"box","text":"The Municipal Bond Index futures contract is traded only on the CBT. Like other contract markets, the CBT","page_number":92,"box":{"x":101,"y":445,"width":756,"height":11}},{"id":"8c5188f6-e5ed-4c44-9691-d3e71d073c57","block_type":"box","text":"assures performance under futures contracts through a clearing corporation, a nonprofit organization managed by the","page_number":92,"box":{"x":69,"y":460,"width":839,"height":12}},{"id":"c13a8676-f5f1-4c58-9c03-f233b91730f9","block_type":"box","text":"exchange membership that is also responsible for handling daily accounting of deposits or withdrawals of margin.","page_number":92,"box":{"x":69,"y":475,"width":808,"height":12}},{"id":"93a848c6-3483-4c8e-b8a2-4eb5244cf749","block_type":"box","text":"The particular municipal bonds comprising the index underlying the Municipal Bond Index financial futures","page_number":92,"box":{"x":101,"y":498,"width":753,"height":11}},{"id":"aa13f5f7-0820-480f-8a47-c5cc856a386e","block_type":"box","text":"contract may vary from the bonds held by a Municipal Fund. As a result, a Municipal Fund’s ability to hedge","page_number":92,"box":{"x":69,"y":513,"width":764,"height":12}},{"id":"ad6a2974-8e96-4974-a1e0-e1ae4b44f0e0","block_type":"box","text":"effectively all or a portion of the value of its Municipal Bonds through the use of such financial futures contracts will","page_number":92,"box":{"x":69,"y":528,"width":826,"height":12}},{"id":"7ee8b242-7ca8-49fe-9943-f3f129daa364","block_type":"box","text":"depend in part on the degree to which price movements in the index underlying the financial futures contract","page_number":92,"box":{"x":69,"y":543,"width":774,"height":12}},{"id":"493cf36c-36f4-445a-a369-d47d7a9c7d7a","block_type":"box","text":"correlate with the price movements of the Municipal Bonds held by the Fund. The correlation may be affected by","page_number":92,"box":{"x":69,"y":559,"width":801,"height":11}},{"id":"cb006d9e-8bc2-4c24-8566-cb7f24dd4564","block_type":"box","text":"disparities in the average maturity, ratings, geographical mix or structure of a Municipal Fund’s investments as","page_number":92,"box":{"x":69,"y":574,"width":788,"height":11}},{"id":"4277c143-5307-4db0-afc2-9e0159f25f58","block_type":"box","text":"compared to those comprising the Municipal Bond Index and general economic or political factors. In addition, the","page_number":92,"box":{"x":69,"y":589,"width":812,"height":11}},{"id":"704c3952-3eee-4698-8c74-8c894d82bfd7","block_type":"box","text":"correlation between movements in the value of the Municipal Bond Index may be subject to change over time as","page_number":92,"box":{"x":69,"y":604,"width":799,"height":11}},{"id":"c702dd10-ad2a-4082-a4df-435f3286eedc","block_type":"box","text":"additions to and deletions from the Municipal Bond Index alter its structure. The correlation between futures","page_number":92,"box":{"x":69,"y":619,"width":772,"height":11}},{"id":"82a7f626-22d6-42db-9cdf-405ef91f4599","block_type":"box","text":"contracts on U.S. Government Securities and the Municipal Bonds held by a Municipal Fund may be adversely","page_number":92,"box":{"x":69,"y":634,"width":782,"height":11}},{"id":"e1ea2e02-2074-4eba-963b-fe6d2364253c","block_type":"box","text":"affected by similar factors and the risk of imperfect correlation between movements in the prices of such futures","page_number":92,"box":{"x":69,"y":649,"width":806,"height":12}},{"id":"4ecc08a1-c20e-49e5-895a-9cfcf190e1a8","block_type":"box","text":"contracts and the prices of Municipal Bonds held by a Municipal Fund may be greater. Municipal Bond Index futures","page_number":92,"box":{"x":69,"y":664,"width":823,"height":12}},{"id":"ea1275e1-3e81-4c43-8c3b-c0d37317de94","block_type":"box","text":"contracts were approved for trading in 1985. Trading in such futures contracts may tend to be less liquid than trading","page_number":92,"box":{"x":69,"y":680,"width":837,"height":11}},{"id":"42abaaa9-bf14-46a6-b59a-a53147a56f19","block_type":"box","text":"in other futures contracts. The trading of futures contracts also is subject to certain market risks, such as inadequate","page_number":92,"box":{"x":70,"y":695,"width":839,"height":11}},{"id":"f8b83935-86a2-498f-a4e3-057514d7211f","block_type":"box","text":"trading activity, which could at times make it difficult or impossible to liquidate existing positions.","page_number":92,"box":{"x":68,"y":710,"width":693,"height":11}},{"id":"0a50b153-7373-4283-9ff1-25b85cd10beb","block_type":"box","text":"Call Rights.","page_number":92,"box":{"x":102,"y":733,"width":79,"height":11}},{"id":"31865c5e-2e53-4aee-a410-ea927ce75532","block_type":"box","text":"A Fund may purchase a Municipal Bond issuer’s right to call all or a portion of such Municipal Bond","page_number":92,"box":{"x":187,"y":732,"width":708,"height":12}},{"id":"b365923a-bece-4cb3-814e-9b6d9f52c144","block_type":"box","text":"for mandatory tender for purchase (a “Call Right”). A holder of a Call Right may exercise such right to require a","page_number":92,"box":{"x":68,"y":748,"width":790,"height":11}},{"id":"b9ab25ed-a5b4-4101-8277-dc9ec12d5e99","block_type":"box","text":"mandatory tender for the purchase of related Municipal Bonds, subject to certain conditions. A Call Right that is not","page_number":92,"box":{"x":69,"y":763,"width":827,"height":11}},{"id":"43b6bc3d-9acb-4a7b-9e93-68892daa7bd9","block_type":"box","text":"exercised prior to maturity of the related Municipal Bond will expire without value. The economic effect of holding","page_number":92,"box":{"x":69,"y":778,"width":805,"height":11}},{"id":"8a414d3c-db39-405f-b3e4-632cf21104cd","block_type":"box","text":"both the Call Right and the related Municipal Bond is identical to holding a Municipal Bond as a non-callable security.","page_number":92,"box":{"x":69,"y":793,"width":833,"height":11}},{"id":"c5e82400-812c-428c-bfb3-8d0f61784e72","block_type":"box","text":"Certain investments in such obligations may be illiquid.","page_number":92,"box":{"x":69,"y":808,"width":393,"height":11}},{"id":"dedb997a-ab7f-440d-b207-219fca01e321","block_type":"box","text":"Municipal Interest Rate Swap Transactions.","page_number":92,"box":{"x":102,"y":831,"width":307,"height":11}},{"id":"86137629-bb8f-4da5-bf61-164e4c44fb86","block_type":"box","text":"In order to hedge the value of a Fund against interest rate","page_number":92,"box":{"x":417,"y":831,"width":411,"height":11}},{"id":"8eb27c3e-9f2b-4847-ac81-3e2fc99d320e","block_type":"box","text":"fluctuations or to enhance a Fund’s income, a Fund may enter into interest rate swap transactions such as Municipal","page_number":92,"box":{"x":68,"y":846,"width":835,"height":11}},{"id":"17ea889d-f12f-4696-b65d-da40e7e365a5","block_type":"box","text":"Market Data AAA Cash Curve swaps (“MMD Swaps”) or Securities Industry and Financial Markets Association","page_number":92,"box":{"x":70,"y":861,"width":781,"height":11}},{"id":"1f501b76-bfdb-4ef4-b3c8-3279899dffca","block_type":"box","text":"Municipal Swap Index swaps (“SIFMA Swaps”). To the extent that a Fund enters into these transactions, the Fund","page_number":92,"box":{"x":70,"y":876,"width":808,"height":11}},{"id":"ae3e26d4-492a-4c0d-9910-cadd10f8818a","block_type":"box","text":"expects to do so primarily to preserve a return or spread on a particular investment or portion of its portfolio or to","page_number":92,"box":{"x":69,"y":891,"width":814,"height":11}},{"id":"08b275ec-2f79-48f5-87d2-5b376a787ff1","block_type":"box","text":"protect against any increase in the price of securities the Fund anticipates purchasing at a later date. A Fund intends","page_number":92,"box":{"x":70,"y":906,"width":832,"height":12}},{"id":"b1dd10cb-fe28-4cea-bb0a-0b0ddc6972de","block_type":"box","text":"II-61","page_number":92,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"e014fa65-1b5d-496b-b253-60c7695cda7d","block_type":"box","text":"NM0926U-5977317-92/232","page_number":92,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"4ebd039e-f5c3-41e4-a14e-d8779f587b57","block_type":"box","text":"to use these transactions primarily as a hedge rather than as a speculative investment. However, a Fund also may","page_number":93,"box":{"x":68,"y":45,"width":817,"height":11}},{"id":"c15be43b-489a-4632-98f8-2ccde853de9a","block_type":"box","text":"invest in MMD Swaps and SIFMA Swaps to enhance income or gain or to increase the Fund’s yield, for example,","page_number":93,"box":{"x":70,"y":60,"width":797,"height":11}},{"id":"d5d1b7d2-4859-4f29-96eb-d5679c8c0e82","block_type":"box","text":"during periods of steep interest rate yield curves (","page_number":93,"box":{"x":69,"y":75,"width":356,"height":11}},{"id":"f98aca6c-796e-4809-a62b-df38042cfbb6","block_type":"box","text":"i.e.","page_number":93,"box":{"x":427,"y":75,"width":20,"height":9}},{"id":"812840a1-b94a-4b9f-acab-1b8d1aaa950f","block_type":"box","text":", wide differences between short-term and long-term interest","page_number":93,"box":{"x":449,"y":75,"width":433,"height":11}},{"id":"26dc125e-bf85-4bb3-8e75-285248c065dc","block_type":"box","text":"rates).","page_number":93,"box":{"x":69,"y":90,"width":44,"height":11}},{"id":"eb6cd04c-d89f-43d4-b7b1-326db474f084","block_type":"box","text":"A Fund may purchase and sell SIFMA Swaps in the SIFMA swap market. In a SIFMA Swap, a Fund exchanges with","page_number":93,"box":{"x":101,"y":113,"width":807,"height":11}},{"id":"92685c2a-e7b4-40ab-b6cd-897405ca3c28","block_type":"box","text":"another party their respective commitments to pay or receive interest (","page_number":93,"box":{"x":69,"y":128,"width":503,"height":11}},{"id":"4bc0c7eb-0772-443e-a522-07cc6b3f17b4","block_type":"box","text":"e.g.","page_number":93,"box":{"x":574,"y":129,"width":25,"height":10}},{"id":"d4965498-c71b-435d-b7fa-d35824bf8150","block_type":"box","text":", an exchange of fixed rate payments for","page_number":93,"box":{"x":601,"y":128,"width":286,"height":11}},{"id":"62e9a453-c7a5-425d-92d1-066e43d56738","block_type":"box","text":"floating rate payments linked to the SIFMA Municipal Swap Index). Because the underlying index is a tax-exempt","page_number":93,"box":{"x":68,"y":143,"width":798,"height":11}},{"id":"2c9c5504-e4f5-4d35-8bd9-90c3254ab935","block_type":"box","text":"index, SIFMA Swaps may reduce cross-market risks incurred by a Fund and increase a Fund’s ability to hedge","page_number":93,"box":{"x":70,"y":158,"width":778,"height":11}},{"id":"cc292f95-63f3-4e35-b229-b8511d21a5d7","block_type":"box","text":"effectively. SIFMA Swaps are typically quoted for the entire yield curve, beginning with a seven day floating rate index","page_number":93,"box":{"x":69,"y":173,"width":833,"height":11}},{"id":"8710d738-2752-4dd0-99e8-a65c37cf8a13","block_type":"box","text":"out to 30 years. The duration of a SIFMA Swap is approximately equal to the duration of a fixed-rate Municipal Bond","page_number":93,"box":{"x":69,"y":188,"width":823,"height":11}},{"id":"399647f3-aacd-4b7f-9a63-6519abd3484e","block_type":"box","text":"with the same attributes as the swap (","page_number":93,"box":{"x":68,"y":204,"width":275,"height":10}},{"id":"6e8f7eff-abf0-46e6-8c0b-3e23213b48dc","block_type":"box","text":"e.g.","page_number":93,"box":{"x":345,"y":205,"width":24,"height":10}},{"id":"9678ca1c-b3f4-4c26-b3fe-d80fba39ac7b","block_type":"box","text":", coupon, maturity, call feature).","page_number":93,"box":{"x":372,"y":203,"width":224,"height":12}},{"id":"757c9fd5-46cb-43e8-aa36-105a3d2d1c5c","block_type":"box","text":"A Fund may also purchase and sell MMD Swaps, also known as MMD rate locks. An MMD Swap permits a Fund","page_number":93,"box":{"x":101,"y":226,"width":797,"height":11}},{"id":"260a8e0e-3dde-4518-8210-e9c36084a1cf","block_type":"box","text":"to lock in a specified municipal interest rate for a portion of its portfolio to preserve a return on a particular","page_number":93,"box":{"x":68,"y":241,"width":770,"height":11}},{"id":"fbb9950d-535b-4bf0-aaf3-fd784a691030","block_type":"box","text":"investment or a portion of its portfolio as a duration management technique or to protect against any increase in the","page_number":93,"box":{"x":70,"y":256,"width":832,"height":12}},{"id":"c4419a1f-6bdf-471b-81b3-d4a61fbbbbcb","block_type":"box","text":"price of securities to be purchased at a later date. By using an MMD Swap, a Fund can create a synthetic long or","page_number":93,"box":{"x":70,"y":271,"width":805,"height":12}},{"id":"2a4cf6bf-da03-434f-bc97-dabc70f8477e","block_type":"box","text":"short position, allowing the Fund to select the most attractive part of the yield curve. An MMD Swap is a contract","page_number":93,"box":{"x":69,"y":286,"width":808,"height":12}},{"id":"1d767c6e-b86a-4b2a-bb8d-2df7bdaa129c","block_type":"box","text":"between a Fund and an MMD Swap provider pursuant to which the parties agree to make payments to each other on","page_number":93,"box":{"x":69,"y":302,"width":832,"height":11}},{"id":"14927644-0788-4298-9767-b0cad765d48d","block_type":"box","text":"a notional amount, contingent upon whether the Municipal Market Data AAA General Obligation Scale is above or","page_number":93,"box":{"x":69,"y":317,"width":804,"height":11}},{"id":"a3297ba3-bab5-4bb4-99df-6cdd55cf06aa","block_type":"box","text":"below a specified level on the expiration date of the contract. For example, if a Fund buys an MMD Swap and the","page_number":93,"box":{"x":69,"y":332,"width":803,"height":11}},{"id":"5bf60620-5eff-44fc-91b3-d94b8896b1b5","block_type":"box","text":"Municipal Market Data AAA General Obligation Scale is below the specified level on the expiration date, the","page_number":93,"box":{"x":70,"y":347,"width":763,"height":11}},{"id":"d7eab2df-299b-4e2c-a6c8-ed97a8ccbaeb","block_type":"box","text":"counterparty to the contract will make a payment to the Fund equal to the specified level minus the actual level,","page_number":93,"box":{"x":69,"y":362,"width":797,"height":11}},{"id":"5e0ed2d3-11b0-4696-b34a-4bbb34f945df","block_type":"box","text":"multiplied by the notional amount of the contract. If the Municipal Market Data AAA General Obligation Scale is above","page_number":93,"box":{"x":69,"y":377,"width":836,"height":12}},{"id":"8c27b246-7145-4534-8dfd-e253a7b3fbe5","block_type":"box","text":"the specified level on the expiration date, a Fund will make a payment to the counterparty equal to the actual level","page_number":93,"box":{"x":68,"y":392,"width":816,"height":12}},{"id":"5b7f4ee7-1b39-40a7-b238-ba450fe40c2c","block_type":"box","text":"minus the specified level, multiplied by the notional amount of the contract.","page_number":93,"box":{"x":69,"y":407,"width":537,"height":12}},{"id":"6567eb87-8f68-44f8-ba42-43ab1899fc79","block_type":"box","text":"In connection with investments in SIFMA and MMD Swaps, there is a risk that municipal yields will move in the","page_number":93,"box":{"x":102,"y":430,"width":788,"height":11}},{"id":"3b48bf8b-fb8c-4394-9bef-942099eddc3d","block_type":"box","text":"opposite direction than anticipated by a Fund, which would cause the Fund to make payments to its counterparty in","page_number":93,"box":{"x":69,"y":446,"width":821,"height":10}},{"id":"6e9608d7-bf39-462e-9e56-aad396f95c91","block_type":"box","text":"the transaction that could adversely affect the Fund’s performance.","page_number":93,"box":{"x":68,"y":460,"width":482,"height":12}},{"id":"8c04e087-8e95-4010-a513-f9c26861cb73","block_type":"box","text":"Insured Municipal Bonds.","page_number":93,"box":{"x":102,"y":483,"width":179,"height":11}},{"id":"d2f22fec-849b-41ce-a58b-514f151106a3","block_type":"box","text":"Bonds purchased by a Fund may be covered by insurance that guarantees that interest","page_number":93,"box":{"x":288,"y":483,"width":619,"height":11}},{"id":"ef405e5d-bdd3-441f-9fa1-6bf6e615b270","block_type":"box","text":"payments on the bond will be made on time and the principal will be repaid when the bond matures. Either the issuer","page_number":93,"box":{"x":70,"y":498,"width":835,"height":11}},{"id":"8d978498-415c-4ab5-832d-0a86015b673f","block_type":"box","text":"of the bond or the Fund purchases the insurance. Insurance is expected to protect the Fund against losses caused by","page_number":93,"box":{"x":69,"y":513,"width":840,"height":12}},{"id":"c0525407-fa00-4df9-9f1d-cf6d1ffec637","block_type":"box","text":"a bond issuer’s failure to make interest or principal payments. However, insurance does not protect the Fund or its","page_number":93,"box":{"x":69,"y":528,"width":818,"height":12}},{"id":"1349da03-0d39-445e-be52-80a06aada005","block_type":"box","text":"shareholders against losses caused by declines in a bond’s market value. Also, the Fund cannot be certain that any","page_number":93,"box":{"x":69,"y":544,"width":829,"height":11}},{"id":"fb0dc6e5-3611-494c-a3a0-15c980efd88d","block_type":"box","text":"insurance company does not make these payments. In addition, if the Fund purchases the insurance, it may pay the","page_number":93,"box":{"x":70,"y":559,"width":827,"height":11}},{"id":"8eed1bd3-460c-4a3f-a508-2b74128e772d","block_type":"box","text":"premiums, which will reduce the Fund’s yield. The Fund seeks to use only insurance companies with claims paying","page_number":93,"box":{"x":70,"y":574,"width":815,"height":11}},{"id":"51617703-c664-406d-8559-c969727eba3c","block_type":"box","text":"ability, financial strength, or equivalent ratings of at least investment grade. However, if insurance from insurers with","page_number":93,"box":{"x":69,"y":589,"width":829,"height":11}},{"id":"cace0a9d-6397-4483-b859-4005c9f4ef2a","block_type":"box","text":"these ratings is not available, the Fund may use insurance companies with lower ratings or stop purchasing","page_number":93,"box":{"x":68,"y":604,"width":767,"height":11}},{"id":"4542d619-cf04-4076-8452-c69f8ce0c53d","block_type":"box","text":"insurance or insured bonds. If a bond’s insurer fails to fulfill its obligations or loses its credit rating, the value of the","page_number":93,"box":{"x":70,"y":619,"width":827,"height":11}},{"id":"d82105df-f78a-4520-872d-b35a6b04664c","block_type":"box","text":"bond could drop.","page_number":93,"box":{"x":69,"y":634,"width":118,"height":11}},{"id":"cd98b773-9ae6-4494-bdb3-c99baffb8035","block_type":"box","text":"Build America Bonds.","page_number":93,"box":{"x":102,"y":657,"width":150,"height":9}},{"id":"c532505a-0084-4f9f-a73e-c51f4fa3d3d2","block_type":"box","text":"If a Fund holds Build America Bonds, the Fund may be eligible to receive a U.S. federal","page_number":93,"box":{"x":259,"y":657,"width":616,"height":11}},{"id":"88b84415-29a1-4d62-84ee-d55d5004d7b1","block_type":"box","text":"income tax credit; however, the issuer of a Build America Bond may instead elect to receive a cash payment directly","page_number":93,"box":{"x":70,"y":672,"width":825,"height":11}},{"id":"7f91df89-05b3-4159-8c2b-816484406659","block_type":"box","text":"from the federal government in lieu of holders such as the fund receiving a tax credit. The interest on Build America","page_number":93,"box":{"x":68,"y":687,"width":824,"height":11}},{"id":"3d8f87ba-c37f-4011-acf3-31b05cc1ef0c","block_type":"box","text":"Bonds is taxable for U.S. federal income tax purposes. If the Fund does receive tax credits from Build America Bonds","page_number":93,"box":{"x":70,"y":702,"width":833,"height":11}},{"id":"d4d55ef5-c917-4711-8ad3-84665f196637","block_type":"box","text":"or other tax credit bonds on one or more specified dates during the fund’s taxable year, and the Fund satisfies the","page_number":93,"box":{"x":69,"y":717,"width":815,"height":12}},{"id":"eb9779b7-60de-45b8-ae2c-64aab00ad4f8","block_type":"box","text":"minimum distribution requirement, the Fund may elect for U.S. federal income tax purposes to pass through to","page_number":93,"box":{"x":69,"y":732,"width":788,"height":12}},{"id":"a18495e3-855c-41e3-a97b-8b189180960d","block_type":"box","text":"shareholders tax credits otherwise allowable to the Fund for that year with respect to such bonds. A tax credit bond","page_number":93,"box":{"x":69,"y":748,"width":823,"height":11}},{"id":"afbae2f2-723b-4b00-ada2-7e3658503c2a","block_type":"box","text":"is defined in the Code as a “qualified tax credit bond” (which includes a qualified forestry conservation bond, a new","page_number":93,"box":{"x":70,"y":763,"width":825,"height":11}},{"id":"d56c2930-7b5c-437e-a4d8-7870f34944d7","block_type":"box","text":"clean renewable energy bond, a qualified energy conservation bond, or a qualified zone academy bond, each of which","page_number":93,"box":{"x":69,"y":778,"width":837,"height":11}},{"id":"6d73456b-f148-4e46-ba7a-29c6c2e18659","block_type":"box","text":"must meet certain requirements specified in the Code), a “Build America Bond” (which includes certain qualified","page_number":93,"box":{"x":69,"y":793,"width":802,"height":11}},{"id":"3f857cac-f5de-4ac6-8348-b4ec0e642622","block_type":"box","text":"bonds issued before January 1, 2011) or certain other specified bonds. If the Fund were to so elect, a shareholder","page_number":93,"box":{"x":69,"y":808,"width":821,"height":11}},{"id":"14259073-a779-4e4d-af60-a9cfac0aa74f","block_type":"box","text":"would be required to include in income and would be entitled to claim as a tax credit an amount equal to a","page_number":93,"box":{"x":68,"y":823,"width":760,"height":11}},{"id":"52337cc6-6e30-44aa-b79f-a3657ac1d358","block_type":"box","text":"proportionate share of such credits, and such amount would be subject to withholding provisions of the Code.","page_number":93,"box":{"x":70,"y":838,"width":782,"height":12}},{"id":"3e5ff163-68d2-4ddc-a27e-fa60520a8d03","block_type":"box","text":"Certain limitations may apply on the extent to which the credit may be claimed.","page_number":93,"box":{"x":69,"y":854,"width":563,"height":11}},{"id":"4ffcb390-cade-4bd1-bdb5-4324e6ff420d","block_type":"box","text":"Tax-Exempt Municipal Investments.","page_number":93,"box":{"x":103,"y":876,"width":246,"height":11}},{"id":"cdc3f099-5629-4395-98d3-fadc3d94aa26","block_type":"box","text":"Certain Funds may hold tax-exempt municipal investments which may be in","page_number":93,"box":{"x":355,"y":876,"width":534,"height":11}},{"id":"4222db9a-1348-4bdf-9384-62a41edb0735","block_type":"box","text":"the form of tender option bonds, variable rate demand obligations, participations, beneficial interests in a trust,","page_number":93,"box":{"x":68,"y":891,"width":798,"height":12}},{"id":"9b3b4d0c-33a9-4e62-a703-c9bee067ca34","block_type":"box","text":"partnership interests or other forms. These investments are described in greater detail above in this section. Some","page_number":93,"box":{"x":70,"y":906,"width":823,"height":12}},{"id":"d8e55b53-ffe5-429e-833a-6ae19bed9a06","block_type":"box","text":"II-62","page_number":93,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"22166aea-5919-410e-9368-171b784bad43","block_type":"box","text":"NM0926U-5977317-93/232","page_number":93,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"ffc71277-287b-411c-ac38-d87aed9dbb83","block_type":"box","text":"of the structures used by certain Funds include interests in long-term fixed-rate municipal debt obligations, held by a","page_number":94,"box":{"x":69,"y":45,"width":830,"height":11}},{"id":"b983a1b3-3e0c-44e0-8877-5960afe4a5ff","block_type":"box","text":"trustee or custodian, that are coupled with tender option, demand and other features when the tax-exempt municipal","page_number":94,"box":{"x":68,"y":60,"width":832,"height":11}},{"id":"66ae9060-2230-4a88-8a96-62fba46e6ac5","block_type":"box","text":"investments are created. Together, these features entitle the holder of the interest to tender (or put) the underlying","page_number":94,"box":{"x":70,"y":75,"width":819,"height":11}},{"id":"f61abfc3-07f8-4efc-9802-9325b754411d","block_type":"box","text":"municipal debt obligation to a third party at periodic intervals and to receive the principal amount thereof.","page_number":94,"box":{"x":69,"y":90,"width":752,"height":11}},{"id":"44a080e3-ba1f-442d-b046-88a047319083","block_type":"box","text":"In some cases, municipal debt obligations are represented by custodial receipts evidencing rights to receive","page_number":94,"box":{"x":102,"y":113,"width":770,"height":11}},{"id":"3d456925-9cd9-4d1c-a7a1-0b83efcaed6e","block_type":"box","text":"specific future interest payments, principal payments, or both, on the underlying securities held by the custodian.","page_number":94,"box":{"x":69,"y":128,"width":806,"height":11}},{"id":"32d3382b-c569-4b96-913c-f92f193cdeb9","block_type":"box","text":"Under such arrangements, the holder of the custodial receipt has the option to tender the underlying securities at","page_number":94,"box":{"x":70,"y":143,"width":809,"height":11}},{"id":"ac38603f-ace0-4d4c-8295-9f07437bd226","block_type":"box","text":"their face value to the sponsor (","page_number":94,"box":{"x":68,"y":158,"width":228,"height":11}},{"id":"8a032ec6-9fef-4ac9-9db3-8745ef54dcc6","block_type":"box","text":"e.g.","page_number":94,"box":{"x":297,"y":160,"width":25,"height":9}},{"id":"653b8eca-f83b-487b-8764-ad9d8ca12111","block_type":"box","text":", a Fund, or a bank or broker-dealer or other financial institution), which is paid","page_number":94,"box":{"x":325,"y":158,"width":557,"height":11}},{"id":"963fb06d-6f59-4ed6-ae49-3cc7a4008db2","block_type":"box","text":"periodic fees equal to the difference between the securities’ fixed coupon rate and the rate that would cause the","page_number":94,"box":{"x":70,"y":173,"width":803,"height":11}},{"id":"7847c313-470d-4c3b-8605-def5785eeb48","block_type":"box","text":"securities, coupled with the tender option, to trade at par on the date of a rate adjustment.","page_number":94,"box":{"x":69,"y":188,"width":648,"height":11}},{"id":"d3d14aaa-fe69-4e17-afc5-3a83871ebad6","block_type":"box","text":"A participation interest gives the Fund an undivided interest in a Municipal Bond in the proportion the Fund’s","page_number":94,"box":{"x":101,"y":211,"width":775,"height":11}},{"id":"39f72581-20ba-4d82-9e6d-52967be9f76c","block_type":"box","text":"participation bears to the total principal amount of the Municipal Bond, and typically provides for a repurchase","page_number":94,"box":{"x":70,"y":226,"width":785,"height":11}},{"id":"49b0e807-22c1-439e-9570-d1aafa6df387","block_type":"box","text":"feature for all or any part of the full principal amount of the participation interest, plus accrued interest. Trusts and","page_number":94,"box":{"x":68,"y":241,"width":821,"height":11}},{"id":"737c82d4-a124-4e75-b319-130e51996cdf","block_type":"box","text":"partnerships are typically used to convert long-term fixed rate high quality bonds of a single state or municipal issuer","page_number":94,"box":{"x":70,"y":256,"width":833,"height":12}},{"id":"3102b271-48de-4716-b0ca-f7e3e0e1d7a7","block_type":"box","text":"into variable or floating rate demand instruments.","page_number":94,"box":{"x":70,"y":271,"width":351,"height":12}},{"id":"23cd04e0-8ba1-4a4c-ac25-92631296d432","block_type":"box","text":"The Municipal Bond Funds may hold participation interests and custodial receipts for municipal debt obligations","page_number":94,"box":{"x":101,"y":294,"width":797,"height":11}},{"id":"e32c7998-c66a-4a60-886a-90b31239594d","block_type":"box","text":"which give the holder the right to receive payment of principal subject to the conditions described above. The IRS has","page_number":94,"box":{"x":68,"y":309,"width":836,"height":11}},{"id":"c780477f-46f0-4b60-9ece-51f64989a6f6","block_type":"box","text":"not ruled on whether the interest received on tax-exempt municipal investments in the form of participation interests","page_number":94,"box":{"x":69,"y":324,"width":831,"height":11}},{"id":"bdae0e68-e3bc-4395-af53-4f39f2ae9e44","block_type":"box","text":"or custodial receipts is tax-exempt, and accordingly, purchases of any such interests or receipts are based on the","page_number":94,"box":{"x":69,"y":339,"width":809,"height":12}},{"id":"7a25081b-5f08-4923-9708-df3e915c319b","block_type":"box","text":"opinions of counsel to the sponsors of such derivative securities. Neither a Fund nor its investment adviser or sub","page_number":94,"box":{"x":69,"y":355,"width":818,"height":11}},{"id":"bc73929c-80a7-48bb-a7cf-b27a211aac2f","block_type":"box","text":"advisers will review the proceedings related to the creation of any tax-exempt municipal investments or the basis for","page_number":94,"box":{"x":69,"y":370,"width":828,"height":11}},{"id":"0cd4944d-907b-4bd7-ab9d-5b9779b397fd","block_type":"box","text":"such opinions.","page_number":94,"box":{"x":69,"y":385,"width":102,"height":11}},{"id":"90002eec-7f5e-4871-b061-d548abec6d5e","block_type":"box","text":"Operational and Technology Risks.","page_number":94,"box":{"x":102,"y":408,"width":250,"height":11}},{"id":"316ce5a8-f813-4c5c-acc9-e723ae7d9619","block_type":"box","text":"The Fund and the entities with which it interacts directly or indirectly are","page_number":94,"box":{"x":358,"y":408,"width":512,"height":11}},{"id":"7c37ce78-292e-4f5d-9a75-fc29b112194a","block_type":"box","text":"susceptible to operational and technology risks, including those related to human errors, processing errors,","page_number":94,"box":{"x":69,"y":423,"width":766,"height":11}},{"id":"cceff561-ae72-4069-8e75-2747540836c6","block_type":"box","text":"communication errors, systems failures, cybersecurity incidents, and the use of artificial intelligence and machine","page_number":94,"box":{"x":69,"y":438,"width":812,"height":11}},{"id":"03a2307a-5511-4863-8f88-7f7400a6e28e","block_type":"box","text":"learning (“AI”), which may result in losses for the Fund and its shareholders or impair the Fund’s operations. These","page_number":94,"box":{"x":70,"y":453,"width":820,"height":11}},{"id":"f9096712-ecef-4e5c-8ffb-5b021d8b9c79","block_type":"box","text":"entities include, but are not limited to, the Fund’s adviser, administrator, distributor, other service providers (e.g.,","page_number":94,"box":{"x":69,"y":468,"width":807,"height":11}},{"id":"dd314759-8d32-4ead-875b-ef768619f1b4","block_type":"box","text":"index and benchmark providers, accountants, custodians, and transfer agents), financial intermediaries,","page_number":94,"box":{"x":70,"y":483,"width":741,"height":11}},{"id":"6dbccabf-6955-475f-9207-05bef23372ff","block_type":"box","text":"counterparties, market makers, Authorized Participants, listing exchanges, other financial market operators, and","page_number":94,"box":{"x":69,"y":498,"width":802,"height":11}},{"id":"30093047-101c-4e91-849a-c93e529855a0","block_type":"box","text":"governmental authorities, as applicable. Operational and technology risks for the issuers in which the Fund invests","page_number":94,"box":{"x":68,"y":513,"width":818,"height":12}},{"id":"f8db46a6-b841-4092-a04d-6feaa63b091e","block_type":"box","text":"could also result in material adverse consequences for such issuers and may cause the Fund’s investments in such","page_number":94,"box":{"x":69,"y":528,"width":827,"height":12}},{"id":"0969f8d1-44a2-4112-ac21-577bc5bbbf6d","block_type":"box","text":"issuers to lose value. The Fund may incur substantial costs in order to mitigate operational and technology risks.","page_number":94,"box":{"x":70,"y":544,"width":803,"height":11}},{"id":"cf957f48-01ec-4c43-8360-466546059e20","block_type":"box","text":"Cybersecurity incidents can result from deliberate attacks or unintentional events against an issuer in which the","page_number":94,"box":{"x":102,"y":566,"width":796,"height":11}},{"id":"d3a05791-2949-40dc-b6a3-1efa767ed204","block_type":"box","text":"Fund invests, the Fund or any of its service providers. They include, but are not limited to, gaining unauthorized","page_number":94,"box":{"x":70,"y":581,"width":790,"height":12}},{"id":"33c4c389-6371-4896-b829-cd4ad0cb6f2a","block_type":"box","text":"access to systems, misappropriating assets or sensitive information, corrupting or destroying data, and causing","page_number":94,"box":{"x":69,"y":596,"width":800,"height":12}},{"id":"f766f8a8-ef09-499e-9dc5-640eee5cc03f","block_type":"box","text":"operational disruption. Geopolitical tension may increase the scale and sophistication of deliberate attacks,","page_number":94,"box":{"x":69,"y":612,"width":768,"height":11}},{"id":"67b23b43-f5a8-4b10-8067-d5751cbbbae6","block_type":"box","text":"particularly those from nation states or from entities with nation state backing. Cybersecurity incidents may result in","page_number":94,"box":{"x":70,"y":627,"width":827,"height":11}},{"id":"e95cc315-2b16-492e-a603-19b4f4214284","block_type":"box","text":"any of the following: financial losses; interference with the Fund’s ability to calculate its NAV; disclosure of","page_number":94,"box":{"x":69,"y":642,"width":760,"height":11}},{"id":"8c2f241c-7567-400b-ab6f-ae0651f179c1","block_type":"box","text":"confidential information; impediments to trading; submission of erroneous trades by the Fund or erroneous","page_number":94,"box":{"x":69,"y":657,"width":763,"height":11}},{"id":"f313d918-1568-4ffc-affc-8dcef62225a6","block_type":"box","text":"subscription or redemption orders; the inability of the Fund or its service providers to transact business; violations of","page_number":94,"box":{"x":69,"y":672,"width":835,"height":11}},{"id":"d544a270-c0c1-402e-88da-5bcbad74c9f0","block_type":"box","text":"applicable privacy and other laws; regulatory fines; penalties; reputational damage; reimbursement or other","page_number":94,"box":{"x":69,"y":687,"width":766,"height":11}},{"id":"5cfd2f00-87b2-4dd6-8318-07d94d171178","block_type":"box","text":"compensation costs; and other legal and compliance expenses. Furthermore, cybersecurity incidents may render","page_number":94,"box":{"x":69,"y":703,"width":804,"height":11}},{"id":"ecbf0271-2f20-40af-a45c-f94b7f20a0f0","block_type":"box","text":"records of the Fund, including records relating to its assets and transactions, shareholder ownership of Fund shares,","page_number":94,"box":{"x":69,"y":717,"width":833,"height":12}},{"id":"ebba66e8-5973-4e75-8351-141800893927","block_type":"box","text":"and other data integral to the Fund’s functioning, inaccessible, inaccurate or incomplete. Power outages, natural","page_number":94,"box":{"x":69,"y":732,"width":800,"height":12}},{"id":"7fa8599a-5b0a-4345-a08d-f4a75ee9523b","block_type":"box","text":"disasters, equipment malfunctions and processing errors that threaten information and technology systems relied","page_number":94,"box":{"x":69,"y":748,"width":812,"height":11}},{"id":"db7b29dc-caa4-43de-9996-6052c07b64c5","block_type":"box","text":"upon by the Fund or its service providers, as well as market events that occur at a pace that overloads these","page_number":94,"box":{"x":69,"y":763,"width":777,"height":11}},{"id":"ae9baf89-7c5e-4960-a8c7-420127a6a5c6","block_type":"box","text":"systems, may also disrupt business operations or impact critical data. Recent advances in AI technology pose risks","page_number":94,"box":{"x":69,"y":778,"width":824,"height":11}},{"id":"b03d6333-52dd-4a8a-bbf9-67afefe09ba6","block_type":"box","text":"to the Fund and its portfolio investments. These advancements could harm the Fund and its portfolio investments by","page_number":94,"box":{"x":68,"y":793,"width":836,"height":11}},{"id":"e8ad050f-a81b-40bb-a388-9c16c74db4f9","block_type":"box","text":"reducing the demand for both the technology and software offerings of the Fund’s portfolio investments. Additionally,","page_number":94,"box":{"x":69,"y":808,"width":833,"height":11}},{"id":"3218004a-6499-4269-a803-0c49112246fe","block_type":"box","text":"these advancements could significantly disrupt the Fund’s portfolio investments and subject them to increased","page_number":94,"box":{"x":68,"y":823,"width":793,"height":12}},{"id":"b6666b36-54cd-4e89-9244-8f0430dfc573","block_type":"box","text":"competition, which could have a material adverse effect on business, financial condition, and results of operations.","page_number":94,"box":{"x":69,"y":838,"width":822,"height":11}},{"id":"f25df4e6-02b9-4b38-8252-e323312079c4","block_type":"box","text":"AI technology advancements, including efficiency improvements, without related increases in the adoption and","page_number":94,"box":{"x":68,"y":853,"width":787,"height":12}},{"id":"2db483ce-7ef8-453d-a50d-a5de89d25615","block_type":"box","text":"development of such technologies, could also negatively impact demand for, and the valuation of, digital","page_number":94,"box":{"x":69,"y":869,"width":742,"height":11}},{"id":"e4d5cd19-a392-4efc-a5d5-bbb8991172f2","block_type":"box","text":"infrastructure assets.","page_number":94,"box":{"x":70,"y":884,"width":151,"height":9}},{"id":"0ada65fe-79a6-4b12-81ae-12c907cf9415","block_type":"box","text":"II-63","page_number":94,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"bf95d4c7-7fb5-4065-b8d2-eb5b5f865583","block_type":"box","text":"NM0926U-5977317-94/232","page_number":94,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"b7f25bdf-5751-49e2-8266-704469352824","block_type":"box","text":"The Fund and its portfolio investments could be exposed to the risks of AI technology if third-party service","page_number":95,"box":{"x":101,"y":45,"width":755,"height":11}},{"id":"6bf7ade8-0912-455d-8e10-ef2dcb777b5c","block_type":"box","text":"providers or any counterparties, whether or not known to the Fund, also use AI technology in their business activities.","page_number":95,"box":{"x":70,"y":60,"width":835,"height":11}},{"id":"d339fc35-62f8-42f9-a931-8d7e4e6d39db","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-party products","page_number":95,"box":{"x":68,"y":75,"width":833,"height":11}},{"id":"fe91e8f3-a050-4bc4-804b-11728ceec44d","block_type":"box","text":"or services.","page_number":95,"box":{"x":69,"y":90,"width":82,"height":9}},{"id":"2905b0be-8115-4074-ab5c-f4c77c709353","block_type":"box","text":"Use of AI technology could include the input of confidential information in contravention of applicable policies,","page_number":95,"box":{"x":102,"y":113,"width":781,"height":11}},{"id":"d47a69a1-d582-4aba-b867-941f66db2c6e","block_type":"box","text":"contractual or other obligations or restrictions, resulting in such confidential information becoming accessible by","page_number":95,"box":{"x":69,"y":128,"width":801,"height":11}},{"id":"d8a87dc7-0443-442e-a6f2-dcd54bb717fc","block_type":"box","text":"other third-party AI technology applications and users.","page_number":95,"box":{"x":69,"y":143,"width":383,"height":11}},{"id":"097aa71b-335a-4df3-96b6-96e0c5e366e6","block_type":"box","text":"Independent of its context of use, AI technology is generally highly reliant on the collection and analysis of large","page_number":95,"box":{"x":102,"y":166,"width":795,"height":11}},{"id":"8977cbd4-b5c5-4a2e-8012-1a655a8c8c4c","block_type":"box","text":"amounts of data, may incorporate biased or inaccurate data, and it is not possible or practicable to incorporate all","page_number":95,"box":{"x":69,"y":181,"width":813,"height":11}},{"id":"f3863684-3be8-4cac-b0cc-0cd139f8e2b5","block_type":"box","text":"relevant data into the models that AI technology utilizes to operate. Certain data in such models will inevitably","page_number":95,"box":{"x":69,"y":196,"width":785,"height":11}},{"id":"c94ab369-6b2e-4ca1-b6fd-f7347530b3c1","block_type":"box","text":"contain a degree of inaccuracy and error, or could otherwise be inadequate or flawed, which would be likely to","page_number":95,"box":{"x":69,"y":211,"width":782,"height":11}},{"id":"1bc82095-3c9a-43f0-9ef8-6f8568d967c7","block_type":"box","text":"degrade the effectiveness of AI technology. The output or results of any such AI technologies may therefore be","page_number":95,"box":{"x":69,"y":226,"width":787,"height":11}},{"id":"4ba9529d-dd3d-47fe-8757-5f2d6e754e5c","block_type":"box","text":"incomplete, erroneous, distorted, or misleading. Further, AI tools may lack transparency as to how data is utilized","page_number":95,"box":{"x":70,"y":241,"width":809,"height":11}},{"id":"d33d96dc-9c41-4cba-90b6-4818bb38d58b","block_type":"box","text":"and how outputs are generated. AI technologies may also allow the unintended introduction of vulnerabilities into","page_number":95,"box":{"x":69,"y":256,"width":805,"height":12}},{"id":"f3a881f3-1ecb-4c41-abcd-ab32a8aff5a9","block_type":"box","text":"infrastructures and applications. To the extent that the Fund or its portfolio investments are exposed to the risks of","page_number":95,"box":{"x":70,"y":271,"width":822,"height":11}},{"id":"673565cc-6c24-40dd-a00d-990f36f82727","block_type":"box","text":"AI technology use, any such inaccuracies or errors could have adverse impacts on the Fund or its investments.","page_number":95,"box":{"x":68,"y":287,"width":789,"height":11}},{"id":"9a2c2a5a-52f4-4554-a120-779366b58234","block_type":"box","text":"Regulations related to AI technology could also impose certain obligations and costs related to monitoring and","page_number":95,"box":{"x":102,"y":309,"width":786,"height":11}},{"id":"9d50f7d2-f161-44ba-be5a-0d8b9a38a8bb","block_type":"box","text":"compliance. For example, in April 2023, the Federal Trade Commission, U.S. Department of Justice, Consumer","page_number":95,"box":{"x":69,"y":324,"width":791,"height":11}},{"id":"c782bb15-bff4-418c-ae1c-1b07bf955cae","block_type":"box","text":"Financial Protection Bureau, and U.S. Equal Employment Opportunity Commission released a joint statement on","page_number":95,"box":{"x":70,"y":340,"width":796,"height":11}},{"id":"c646939a-1b51-47dd-ad5b-2922ee2ad466","block_type":"box","text":"artificial intelligence demonstrating interest in monitoring the development and use of automated systems and","page_number":95,"box":{"x":69,"y":355,"width":788,"height":11}},{"id":"7b9b7902-02f8-4b7d-b670-f649557203a9","block_type":"box","text":"enforcement of their respective laws and regulations. In October 2023, an executive order established new standards","page_number":95,"box":{"x":69,"y":370,"width":839,"height":11}},{"id":"165c235a-299b-443f-834c-3a2a4336dc42","block_type":"box","text":"for AI safety and security. In addition to the U.S. regulatory framework, in 2024, the EU adopted the Artificial","page_number":95,"box":{"x":68,"y":385,"width":773,"height":11}},{"id":"3ce895c5-a21d-4a01-9f62-81c5aec6bacf","block_type":"box","text":"Intelligence Act, which applies to certain AI technology and the data used to train, test, and deploy them, which may","page_number":95,"box":{"x":70,"y":400,"width":826,"height":11}},{"id":"651d3991-03f6-4ad5-b6f2-9a31575b6af7","block_type":"box","text":"create additional compliance burdens, higher administrative costs, and significant penalties should the Fund, the","page_number":95,"box":{"x":69,"y":415,"width":805,"height":11}},{"id":"cb0004d4-7e93-4687-a626-379cc4542527","block_type":"box","text":"adviser, or the Fund’s portfolio investments fail to comply.","page_number":95,"box":{"x":69,"y":430,"width":412,"height":11}},{"id":"e540e372-95bf-460c-ad9d-a89519897c9c","block_type":"box","text":"AI technology and its applications, including in the investment and financial sectors, continue to develop rapidly,","page_number":95,"box":{"x":101,"y":453,"width":797,"height":11}},{"id":"1c6b845d-d712-4b6a-a4fe-069a9313971e","block_type":"box","text":"and it is impossible to predict the future risks that may arise from such developments. The full extent of current or","page_number":95,"box":{"x":69,"y":468,"width":817,"height":11}},{"id":"85564457-4db6-489d-b749-4d08c9322291","block_type":"box","text":"future risks related thereto is not possible to predict, and the Fund may not be able to anticipate, prevent, mitigate,","page_number":95,"box":{"x":68,"y":483,"width":824,"height":11}},{"id":"6a44ce26-1b14-4181-af17-67e252be8ac7","block_type":"box","text":"or remediate all of the potential risks, challenges, or impacts of such changes.","page_number":95,"box":{"x":69,"y":498,"width":561,"height":11}},{"id":"80fce659-e6ad-422e-8fee-cbb9c47b0f35","block_type":"box","text":"While the Fund’s service providers are required to have appropriate operational, information security and","page_number":95,"box":{"x":101,"y":521,"width":747,"height":11}},{"id":"782ceef4-ae6a-452e-871b-39867a0c4e25","block_type":"box","text":"cybersecurity risk management policies and procedures, their methods of risk management may differ from those of","page_number":95,"box":{"x":69,"y":536,"width":830,"height":11}},{"id":"bd5b6b8d-b6dd-4c61-addb-06f65fc88562","block_type":"box","text":"the Fund in the setting of priorities, the personnel and resources available or the effectiveness of relevant controls.","page_number":95,"box":{"x":68,"y":551,"width":823,"height":11}},{"id":"42c559b0-33b5-4c0d-b5ba-aba944852733","block_type":"box","text":"The Fund and its adviser seek to reduce these risks through controls, procedures and oversight, including","page_number":95,"box":{"x":68,"y":566,"width":755,"height":11}},{"id":"fe9ce046-5a56-416e-9751-0ea258a71f1c","block_type":"box","text":"establishing business continuity plans and risk management systems. However, there are inherent limitations in such","page_number":95,"box":{"x":69,"y":582,"width":838,"height":11}},{"id":"305fec94-6f00-4d36-a53e-d78689e3d704","block_type":"box","text":"plans and systems, including the possibility that certain risks that may affect the Fund have not been identified or","page_number":95,"box":{"x":70,"y":596,"width":812,"height":12}},{"id":"56eb8d85-4823-4262-9639-d30cad262d26","block_type":"box","text":"may emerge in the future; that such plans and systems may not completely eliminate the occurrence or mitigate the","page_number":95,"box":{"x":69,"y":612,"width":828,"height":11}},{"id":"e7c047c4-692c-462b-95b1-73e616f56405","block_type":"box","text":"effects of operational or information security disruptions or failures or of cybersecurity incidents; or that prevention","page_number":95,"box":{"x":69,"y":627,"width":819,"height":11}},{"id":"b2e70e2e-48b4-4535-91a1-53d3f1e014b3","block_type":"box","text":"and remediation efforts will not be successful or that incidents will go undetected. The Fund cannot control the","page_number":95,"box":{"x":69,"y":642,"width":792,"height":11}},{"id":"6ccbf2ec-66a6-454e-b05a-c85fe29d1804","block_type":"box","text":"systems, information security or other cybersecurity of the issuers in which it invests or its service providers,","page_number":95,"box":{"x":69,"y":657,"width":775,"height":11}},{"id":"c7902367-71a8-400a-a590-dda5681ef1e5","block_type":"box","text":"counterparties, and other third parties whose activities affect the Fund.","page_number":95,"box":{"x":69,"y":672,"width":510,"height":11}},{"id":"becc0920-710e-4592-9120-a22e06fe0c7a","block_type":"box","text":"Lastly, the regulatory climate governing cybersecurity and data protection is developing quickly and may vary","page_number":95,"box":{"x":102,"y":695,"width":771,"height":11}},{"id":"b508ccad-3d63-463b-bacf-f9b688547aa0","block_type":"box","text":"considerably across jurisdictions. Regulators continue to develop new rules and standards related to cybersecurity","page_number":95,"box":{"x":69,"y":710,"width":816,"height":11}},{"id":"2be67740-26ee-4a35-b909-eff04b1a468a","block_type":"box","text":"and data protection. Compliance with evolving regulations can be demanding and costly, requiring substantial","page_number":95,"box":{"x":69,"y":725,"width":778,"height":11}},{"id":"1a05ccf1-685e-4bff-9db7-03e7c92ec8ed","block_type":"box","text":"resources to monitor and implement required changes.","page_number":95,"box":{"x":69,"y":740,"width":391,"height":11}},{"id":"cb7679e9-9c3f-4662-90fb-d7741ebeef6e","block_type":"box","text":"Participation Notes.","page_number":95,"box":{"x":102,"y":763,"width":145,"height":11}},{"id":"ac75d159-4801-41fe-bca8-2240d424d4de","block_type":"box","text":"A Fund may buy participation notes from a bank or broker-dealer (“issuer”) that entitle the","page_number":95,"box":{"x":253,"y":763,"width":641,"height":11}},{"id":"1ce39199-e3ea-4fd0-b64e-4b2682f529b5","block_type":"box","text":"Fund to a return measured by the change in value of an identified underlying security or basket of securities","page_number":95,"box":{"x":70,"y":778,"width":766,"height":11}},{"id":"23ba6651-6e42-4282-ad51-458a45398631","block_type":"box","text":"(collectively, the “underlying security”). Participation notes are typically used when a direct investment in the","page_number":95,"box":{"x":69,"y":793,"width":772,"height":11}},{"id":"ad5abd9a-afc5-46b8-968d-0f39f09c25ba","block_type":"box","text":"underlying security is restricted due to country-specific regulations.","page_number":95,"box":{"x":69,"y":808,"width":475,"height":11}},{"id":"194ba704-eb31-4d79-acbe-eb1b21347141","block_type":"box","text":"The Fund is subject to counterparty risk associated with each issuer. Investment in a participation note is not","page_number":95,"box":{"x":101,"y":831,"width":782,"height":11}},{"id":"d47cd402-d5b8-4371-b88a-f4694cc56970","block_type":"box","text":"the same as investment in the constituent shares of the company. A participation note represents only an obligation","page_number":95,"box":{"x":68,"y":846,"width":831,"height":11}},{"id":"2d5d6503-c926-41cd-9fed-ddb66bdd8b16","block_type":"box","text":"of the issuer to provide the Fund the economic performance equivalent to holding shares of an underlying security. A","page_number":95,"box":{"x":69,"y":861,"width":831,"height":11}},{"id":"28ea7c8a-5c86-4975-9622-ac3dd476d361","block_type":"box","text":"participation note does not provide any beneficial or equitable entitlement or interest in the relevant underlying","page_number":95,"box":{"x":70,"y":876,"width":789,"height":11}},{"id":"246132cd-b7de-480f-afe1-9730c3630303","block_type":"box","text":"security. In other words, shares of the underlying security are not in any way owned by the Fund. However, each","page_number":95,"box":{"x":69,"y":891,"width":791,"height":12}},{"id":"fed62ee4-3991-4d80-81ea-9b4d45417cbf","block_type":"box","text":"participation note synthetically replicates the economic benefit of holding shares in the underlying security. Because","page_number":95,"box":{"x":70,"y":906,"width":827,"height":12}},{"id":"1bde7f98-d334-492b-9d72-52f5ea25b22e","block_type":"box","text":"II-64","page_number":95,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"837015c9-b649-4042-9dbb-b854e7931941","block_type":"box","text":"NM0926U-5977317-95/232","page_number":95,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"cb209837-192c-4936-9997-4f656031e69e","block_type":"box","text":"a participation note is an obligation of the issuer, rather than a direct investment in shares of the underlying security,","page_number":96,"box":{"x":69,"y":45,"width":834,"height":11}},{"id":"64b61b96-3deb-4d3f-8ea8-37650f948aed","block_type":"box","text":"a Fund may suffer losses potentially equal to the full value of the participation note if the issuer fails to perform its","page_number":96,"box":{"x":69,"y":60,"width":822,"height":11}},{"id":"60741b55-3d45-48d9-b96f-8da7bcd25a1e","block_type":"box","text":"obligations. A Fund attempts to mitigate that risk by purchasing only from issuers determined to be creditworthy.","page_number":96,"box":{"x":69,"y":75,"width":801,"height":11}},{"id":"de696afc-b94f-4c8b-8b77-c357e64ca043","block_type":"box","text":"The counterparty may, but is not required to, purchase the shares of the underlying security to hedge its","page_number":96,"box":{"x":101,"y":98,"width":743,"height":11}},{"id":"28926104-b0fd-4ab1-baa6-bcd468d856d8","block_type":"box","text":"obligation. A Fund may, but is not required to, purchase credit protection against the default of the issuer. When the","page_number":96,"box":{"x":69,"y":113,"width":826,"height":11}},{"id":"172ace34-67ad-4fa4-a4f9-fa655a68a828","block_type":"box","text":"participation note expires or a Fund exercises the participation note and closes its position, the Fund receives a","page_number":96,"box":{"x":70,"y":128,"width":799,"height":11}},{"id":"ac80dfc2-de2e-401e-9f17-f48212cae24f","block_type":"box","text":"payment that is based upon the then-current value of the underlying security converted into U.S. dollars (less","page_number":96,"box":{"x":70,"y":143,"width":776,"height":11}},{"id":"23c1b751-e289-465d-a87c-299c14f62432","block_type":"box","text":"transaction costs). The price, performance and liquidity of a participation note are all linked directly to the underlying","page_number":96,"box":{"x":68,"y":158,"width":834,"height":11}},{"id":"acbb9cb2-563a-48a0-85a5-4112833278a2","block_type":"box","text":"security. A Fund’s ability to redeem or exercise a participation note generally is dependent on the liquidity in the local","page_number":96,"box":{"x":69,"y":173,"width":834,"height":11}},{"id":"e4235161-43e7-4cad-940a-f51ae768d349","block_type":"box","text":"trading market for the security underlying the participation note.","page_number":96,"box":{"x":68,"y":188,"width":454,"height":12}},{"id":"00530e11-48a6-482e-92be-18c03268a7c1","block_type":"box","text":"Portfolio Turnover Rates.","page_number":96,"box":{"x":102,"y":211,"width":181,"height":9}},{"id":"7a5a1461-3d51-4f2f-9212-2ad861c19d4d","block_type":"box","text":"A Fund’s annual portfolio turnover rate will not be a factor preventing a sale or","page_number":96,"box":{"x":289,"y":211,"width":558,"height":11}},{"id":"6bcc23f1-c44d-477b-98cc-edfa6c92055b","block_type":"box","text":"purchase when the Manager believes investment considerations warrant such sale or purchase. Although certain","page_number":96,"box":{"x":70,"y":226,"width":804,"height":11}},{"id":"f5a7db30-55cb-4ac0-9ab7-fb7d772bd5e5","block_type":"box","text":"Funds will use an approach to investing that is largely a passive, indexing approach, such Funds may engage in a","page_number":96,"box":{"x":70,"y":241,"width":806,"height":11}},{"id":"d6647e31-c2fc-41cf-9864-19ed69c3788c","block_type":"box","text":"substantial number of portfolio transactions. With respect to these Funds, the rate of portfolio turnover will be a","page_number":96,"box":{"x":69,"y":256,"width":800,"height":11}},{"id":"45ea5030-1f0d-4b43-bf93-cae5704f58d3","block_type":"box","text":"limiting factor when the Manager considers whether to purchase or sell securities for a Fund only to the extent that","page_number":96,"box":{"x":70,"y":271,"width":818,"height":12}},{"id":"ae1d1416-f187-4585-8e8c-4ea008f15217","block_type":"box","text":"the Manager will consider the impact of transaction costs on a Fund’s tracking error. Portfolio turnover may vary","page_number":96,"box":{"x":68,"y":286,"width":800,"height":12}},{"id":"ea606ce7-2005-4036-955c-6d971264a5b2","block_type":"box","text":"greatly from year to year as well as within a particular year. High portfolio turnover (","page_number":96,"box":{"x":68,"y":302,"width":595,"height":11}},{"id":"28cac48d-022e-4ee9-9a8f-853ef44d1ac6","block_type":"box","text":"i.e.","page_number":96,"box":{"x":665,"y":302,"width":20,"height":9}},{"id":"01e007b5-5cd8-4180-8cf1-d809bde5fd6f","block_type":"box","text":", 100% or more) may result in","page_number":96,"box":{"x":687,"y":302,"width":210,"height":11}},{"id":"7f0f3f61-64a1-4ff4-ae75-b2d0e1c71f8a","block_type":"box","text":"increased transaction costs to a Fund, including brokerage commissions, dealer mark-ups and other transaction","page_number":96,"box":{"x":70,"y":317,"width":797,"height":11}},{"id":"4609f0ef-c1f8-4943-b4fb-fc109b6b32d4","block_type":"box","text":"costs on the sale of the securities and reinvestment in other securities. The sale of a Fund’s securities may result in","page_number":96,"box":{"x":69,"y":332,"width":832,"height":11}},{"id":"4ec064f2-606e-47d7-9f07-972896b8c2c8","block_type":"box","text":"the recognition of capital gain or loss. Given the frequency of sales, such gain or loss will likely be short-term capital","page_number":96,"box":{"x":68,"y":347,"width":831,"height":11}},{"id":"60db6fa0-1817-43db-99af-a546a8c640d1","block_type":"box","text":"gain or loss. These effects of higher than normal portfolio turnover may adversely affect a Fund’s performance.","page_number":96,"box":{"x":68,"y":362,"width":795,"height":11}},{"id":"153a9a08-8602-46b2-884c-d3c30ccdecb3","block_type":"box","text":"Preferred Stock.","page_number":96,"box":{"x":102,"y":385,"width":118,"height":9}},{"id":"36d31e3c-42e6-40cc-9fb1-af5919760286","block_type":"box","text":"Certain Funds may invest in preferred stocks. Preferred stock has a preference over common","page_number":96,"box":{"x":226,"y":385,"width":665,"height":11}},{"id":"b8ac3669-a93d-48d1-b397-132326e38e86","block_type":"box","text":"stock in liquidation (and generally dividends as well) but is subordinated to bond holders and other creditors in all","page_number":96,"box":{"x":69,"y":400,"width":808,"height":11}},{"id":"9ab5c3c8-ae14-4a56-aaa5-ad67d7205be4","block_type":"box","text":"respects. As a general rule, the market value of preferred stock with a fixed dividend rate and no conversion element","page_number":96,"box":{"x":69,"y":415,"width":834,"height":11}},{"id":"fc3019b8-acc9-4db7-a370-9d49844e4b01","block_type":"box","text":"varies inversely with interest rates and perceived credit risk, while the market price of convertible preferred stock","page_number":96,"box":{"x":68,"y":430,"width":808,"height":11}},{"id":"3057e7dd-0fd5-44d4-b9ed-8bf638481bd0","block_type":"box","text":"generally also reflects some element of conversion value. Because preferred stock is junior to debt securities and","page_number":96,"box":{"x":68,"y":445,"width":813,"height":12}},{"id":"0ffbf666-cff5-4fa9-a625-ba2613e8c908","block_type":"box","text":"other obligations of the issuer, deterioration in the credit quality of the issuer will cause greater changes in the value","page_number":96,"box":{"x":69,"y":460,"width":831,"height":12}},{"id":"3c12c68e-dbbc-430d-a9a7-f05722073ad8","block_type":"box","text":"of a preferred stock than in a more senior debt security with similar stated yield characteristics. Unlike interest","page_number":96,"box":{"x":69,"y":475,"width":791,"height":12}},{"id":"1b9acd31-72d3-4119-ba33-2e49b400c3f3","block_type":"box","text":"payments on debt securities, preferred stock dividends are payable only if declared by the issuer’s board of directors.","page_number":96,"box":{"x":70,"y":491,"width":838,"height":11}},{"id":"6dd92bbf-39e3-4252-8094-bbdbc52d4bca","block_type":"box","text":"Preferred stock also may be subject to optional or mandatory redemption provisions.","page_number":96,"box":{"x":69,"y":506,"width":604,"height":11}},{"id":"bb4399cc-c5fa-426e-a710-df14e2b69670","block_type":"box","text":"Tax-Exempt Preferred Shares.","page_number":96,"box":{"x":103,"y":528,"width":207,"height":11}},{"id":"66d51e39-9387-4859-99b8-0fba13b8f890","block_type":"box","text":"Certain Funds may invest in preferred interests of other investment funds that pay","page_number":96,"box":{"x":316,"y":528,"width":588,"height":12}},{"id":"e7d8232f-c990-4988-8e8e-fac896faff9a","block_type":"box","text":"dividends that are exempt from regular U.S. federal income tax. Such funds in turn invest in municipal bonds and","page_number":96,"box":{"x":69,"y":543,"width":806,"height":12}},{"id":"a2c298c2-95b5-44af-a8eb-48730c7598d0","block_type":"box","text":"other assets that pay interest or make distributions that are exempt from regular U.S. federal income tax, such as","page_number":96,"box":{"x":69,"y":559,"width":814,"height":11}},{"id":"e6c0bca5-12a2-4708-b3cb-95bc7f9f9cca","block_type":"box","text":"revenue bonds issued by state or local agencies to fund the development of low-income, multi-family housing.","page_number":96,"box":{"x":69,"y":574,"width":780,"height":11}},{"id":"099a1926-9324-4487-8cee-a818b729b6b7","block_type":"box","text":"Investment in such tax-exempt preferred shares involves many of the same issues as investing in other investment","page_number":96,"box":{"x":70,"y":589,"width":820,"height":11}},{"id":"63ef5724-29f6-49ac-b72e-f8b41a060c36","block_type":"box","text":"companies. These investments also have additional risks, including illiquid investments risk, the absence of","page_number":96,"box":{"x":69,"y":604,"width":772,"height":11}},{"id":"0199c394-c2fd-49f1-b6de-b06d7e0c2026","block_type":"box","text":"regulation governing investment practices, capital structure and leverage, affiliated transactions and other matters,","page_number":96,"box":{"x":69,"y":619,"width":821,"height":11}},{"id":"ae3ff3fb-159d-4a0e-8739-7b447c106d3e","block_type":"box","text":"and concentration of investments in particular issuers or industries. The Municipal Bond Funds will treat investments","page_number":96,"box":{"x":69,"y":634,"width":834,"height":11}},{"id":"d41232d0-bc4c-41a7-b747-2e3712256f84","block_type":"box","text":"in tax-exempt preferred shares as investments in municipal bonds.","page_number":96,"box":{"x":70,"y":649,"width":474,"height":11}},{"id":"5f2fde63-2b93-4591-a087-81a08c34c3d7","block_type":"box","text":"Trust Preferred Securities.","page_number":96,"box":{"x":103,"y":672,"width":184,"height":9}},{"id":"f89fdb58-e699-4892-a128-2429cb5ff922","block_type":"box","text":"Certain Funds may invest in trust preferred securities. Trust preferred securities are","page_number":96,"box":{"x":294,"y":672,"width":599,"height":11}},{"id":"a9a3f6de-51b9-4772-9039-1eac7d7ead52","block_type":"box","text":"typically issued by corporations, generally in the form of interest bearing notes with preferred securities","page_number":96,"box":{"x":68,"y":687,"width":737,"height":11}},{"id":"4eb9ddfe-f798-457e-816f-97d2f84b03b3","block_type":"box","text":"characteristics, or by an affiliated business trust of a corporation, generally in the form of beneficial interests in","page_number":96,"box":{"x":69,"y":702,"width":796,"height":12}},{"id":"65e8937b-5a0e-4df1-9375-8c28efe64b27","block_type":"box","text":"subordinated debentures or similarly structured securities. The trust preferred securities market consists of both","page_number":96,"box":{"x":69,"y":717,"width":805,"height":12}},{"id":"e8a304cd-0053-4e7b-82c5-3a4f6cb4fcba","block_type":"box","text":"fixed and adjustable coupon rate securities that are either perpetual in nature or have stated maturity dates.","page_number":96,"box":{"x":68,"y":732,"width":773,"height":12}},{"id":"6b3e49a8-4247-443c-979e-9543e48d1ab4","block_type":"box","text":"Trust preferred securities are typically junior and fully subordinated liabilities of an issuer and benefit from a","page_number":96,"box":{"x":101,"y":755,"width":770,"height":11}},{"id":"67e77e34-01c8-4b6d-b79d-9a2720e20aa2","block_type":"box","text":"guarantee that is junior and fully subordinated to the other liabilities of the guarantor. In addition, trust preferred","page_number":96,"box":{"x":68,"y":770,"width":801,"height":12}},{"id":"1e56f3b5-2b82-4129-86ee-2720729829c6","block_type":"box","text":"securities typically permit an issuer to defer the payment of income for five years or more without triggering an event","page_number":96,"box":{"x":69,"y":785,"width":830,"height":12}},{"id":"7e672ff9-b006-4445-814e-4134b939f6b9","block_type":"box","text":"of default. Because of their subordinated position in the capital structure of an issuer, the ability to defer payments","page_number":96,"box":{"x":69,"y":801,"width":822,"height":11}},{"id":"7d9e1e8a-b026-4f24-ba12-f6f61a11b251","block_type":"box","text":"for extended periods of time without default consequences to the issuer, and certain other features (such as","page_number":96,"box":{"x":68,"y":816,"width":777,"height":11}},{"id":"8d80c585-bbcf-4768-bca2-54776cac8416","block_type":"box","text":"restrictions on common dividend payments by the issuer or ultimate guarantor when full cumulative payments on the","page_number":96,"box":{"x":69,"y":831,"width":831,"height":11}},{"id":"1dca3db4-3ba5-4c0c-a8d7-d67bd01ff69a","block_type":"box","text":"trust preferred securities have not been made), these trust preferred securities are often treated as close","page_number":96,"box":{"x":68,"y":846,"width":757,"height":11}},{"id":"da179eba-4676-4866-b46c-6d596d95b96f","block_type":"box","text":"substitutes for traditional preferred securities, both by issuers and investors.","page_number":96,"box":{"x":69,"y":861,"width":548,"height":11}},{"id":"b7ddfea9-a9f5-42cb-8263-8be1c4faefe0","block_type":"box","text":"Trust preferred securities include but are not limited to trust originated preferred securities (“TOPRS","page_number":96,"box":{"x":101,"y":884,"width":715,"height":11}},{"id":"1170b7a5-e5a4-4000-af48-1dfa0c6fc640","block_type":"box","text":"®","page_number":96,"box":{"x":817,"y":884,"width":5,"height":5}},{"id":"f5d34e4f-b07a-4986-aa34-e8aa6dd326a6","block_type":"box","text":"”); monthly","page_number":96,"box":{"x":824,"y":884,"width":77,"height":11}},{"id":"0a2f951d-1772-4d1d-a1a4-37cc9f8e7118","block_type":"box","text":"income preferred securities (“MIPS","page_number":96,"box":{"x":70,"y":899,"width":248,"height":11}},{"id":"0cc8ddf6-b3b0-4b56-9b22-6ee0c0f4a419","block_type":"box","text":"®","page_number":96,"box":{"x":319,"y":899,"width":6,"height":5}},{"id":"76640396-a6cf-4f90-8ccf-6180cb02b53e","block_type":"box","text":"”); quarterly income bond securities (“QUIBS","page_number":96,"box":{"x":326,"y":899,"width":317,"height":11}},{"id":"a0a7649b-f276-4046-bf67-9a5970b7bf3a","block_type":"box","text":"®","page_number":96,"box":{"x":644,"y":899,"width":6,"height":5}},{"id":"aca67913-c81d-45f7-b017-c1806256c940","block_type":"box","text":"” ); quarterly income debt securities","page_number":96,"box":{"x":652,"y":899,"width":255,"height":11}},{"id":"c2e70b3b-e768-45eb-8ebc-5ca3d9b664d8","block_type":"box","text":"II-65","page_number":96,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"21775521-6f43-4af4-b8cb-593c6e17a25b","block_type":"box","text":"NM0926U-5977317-96/232","page_number":96,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"d8831a0b-f16b-40b8-a527-70dc557ca164","block_type":"box","text":"(“QUIDS","page_number":97,"box":{"x":69,"y":45,"width":57,"height":11}},{"id":"0b59abe6-1163-48cb-823a-9ac76492cebd","block_type":"box","text":"®","page_number":97,"box":{"x":127,"y":45,"width":6,"height":4}},{"id":"384a5685-ccfe-47ed-97bd-53bef9db8fd7","block_type":"box","text":"”); quarterly income preferred securities (“QUIPS","page_number":97,"box":{"x":135,"y":45,"width":346,"height":11}},{"id":"4a7144e6-c944-4bea-8246-4a99418d56d0","block_type":"box","text":"SM","page_number":97,"box":{"x":482,"y":45,"width":11,"height":4}},{"id":"78bef80c-579f-4465-8b38-f355575fa343","block_type":"box","text":"”); corporate trust securities (“CORTS","page_number":97,"box":{"x":495,"y":45,"width":267,"height":11}},{"id":"cdb3e4d7-b82d-4107-a4c0-5fb5de3ca54d","block_type":"box","text":"®","page_number":97,"box":{"x":762,"y":45,"width":6,"height":4}},{"id":"937943fb-71c3-4553-b2c1-9c77cd543edb","block_type":"box","text":"”); public income","page_number":97,"box":{"x":770,"y":45,"width":118,"height":11}},{"id":"ab15317a-b3d2-4067-b780-5761cc313e69","block_type":"box","text":"notes (“PINES","page_number":97,"box":{"x":69,"y":60,"width":99,"height":11}},{"id":"a2410c13-33a2-486e-8ddc-05e4bc33a711","block_type":"box","text":"®","page_number":97,"box":{"x":169,"y":60,"width":6,"height":5}},{"id":"48e0c4eb-4c8a-45af-a738-7c3d66fb148c","block_type":"box","text":"”); and other trust preferred securities.","page_number":97,"box":{"x":177,"y":60,"width":275,"height":11}},{"id":"595bfcbd-c5e1-45a3-aa16-a2b1d8ec9de1","block_type":"box","text":"Trust preferred securities are typically issued with a final maturity date, although some are perpetual in nature.","page_number":97,"box":{"x":101,"y":82,"width":790,"height":12}},{"id":"6c0cb1ab-b931-42e5-8c8b-46aac26c0075","block_type":"box","text":"In certain instances, a final maturity date may be extended and/or the final payment of principal may be deferred at","page_number":97,"box":{"x":70,"y":98,"width":825,"height":11}},{"id":"6b19ab04-19af-4233-8279-c36c5ba03656","block_type":"box","text":"the issuer’s option for a specified time without default. No redemption can typically take place unless all cumulative","page_number":97,"box":{"x":68,"y":113,"width":827,"height":11}},{"id":"46d4d584-d8ea-4382-9f86-41f0acb675be","block_type":"box","text":"payment obligations have been met, although issuers may be able to engage in open-market repurchases without","page_number":97,"box":{"x":70,"y":128,"width":808,"height":11}},{"id":"2974f3f4-2958-44cf-bebe-0c43d2f8a384","block_type":"box","text":"regard to whether all payments have been paid.","page_number":97,"box":{"x":69,"y":143,"width":338,"height":11}},{"id":"92a32764-ce4b-4f2d-aa44-ef291b54181b","block_type":"box","text":"Many trust preferred securities are issued by trusts or other special purpose entities established by operating","page_number":97,"box":{"x":102,"y":166,"width":784,"height":11}},{"id":"a26ddcc4-2256-409c-9824-5b2eec9418c8","block_type":"box","text":"companies and are not a direct obligation of an operating company. At the time the trust or special purpose entity","page_number":97,"box":{"x":69,"y":181,"width":811,"height":11}},{"id":"38725380-e823-44ad-84e4-ef664c1bc74e","block_type":"box","text":"sells such preferred securities to investors, it purchases debt of the operating company (with terms comparable to","page_number":97,"box":{"x":69,"y":196,"width":817,"height":11}},{"id":"b8099ecc-5441-4166-974a-92b9fa73bbe0","block_type":"box","text":"those of the trust or special purpose entity securities), which enables the operating company to deduct for tax","page_number":97,"box":{"x":68,"y":211,"width":785,"height":11}},{"id":"7344d410-f985-40dd-9b02-23d62837cebc","block_type":"box","text":"purposes the interest paid on the debt held by the trust or special purpose entity. The trust or special purpose entity","page_number":97,"box":{"x":70,"y":226,"width":830,"height":11}},{"id":"4fa2e96b-00b0-4fef-a783-9e644a4b7865","block_type":"box","text":"is generally required to be treated as transparent for U.S. federal income tax purposes such that the holders of the","page_number":97,"box":{"x":70,"y":241,"width":819,"height":11}},{"id":"c8ccb375-4748-4607-a370-c98af6005095","block_type":"box","text":"trust preferred securities are treated as owning beneficial interests in the underlying debt of the operating company.","page_number":97,"box":{"x":68,"y":256,"width":827,"height":12}},{"id":"39c142e3-7729-4cc5-8839-f1466a834c80","block_type":"box","text":"Accordingly, payments on the trust preferred securities are treated as interest rather than dividends for U.S. federal","page_number":97,"box":{"x":68,"y":271,"width":824,"height":12}},{"id":"74e58e36-56b2-42f6-baee-33f90631652b","block_type":"box","text":"income tax purposes. The trust or special purpose entity in turn would be a holder of the operating company’s debt","page_number":97,"box":{"x":70,"y":286,"width":819,"height":12}},{"id":"35e21995-4dcc-4a9a-8ab1-fe0da5f0f0c7","block_type":"box","text":"and would have priority with respect to the operating company’s earnings and profits over the operating company’s","page_number":97,"box":{"x":69,"y":302,"width":817,"height":11}},{"id":"3ceef3ff-dce9-4164-b780-5243798188e8","block_type":"box","text":"common shareholders, but would typically be subordinated to other classes of the operating company’s debt.","page_number":97,"box":{"x":69,"y":317,"width":778,"height":11}},{"id":"bd2811d7-fa23-4d56-9c2d-63ed6b1acf7c","block_type":"box","text":"Typically a preferred share has a rating that is slightly below that of its corresponding operating company’s senior","page_number":97,"box":{"x":68,"y":332,"width":811,"height":11}},{"id":"213d9218-0771-47a4-84d3-54caca8782a8","block_type":"box","text":"debt securities.","page_number":97,"box":{"x":69,"y":347,"width":109,"height":9}},{"id":"4fd24d46-cb4b-489a-a63d-b1f6350b6685","block_type":"box","text":"Real Estate Investment Trusts (“REITs”).","page_number":97,"box":{"x":102,"y":370,"width":300,"height":11}},{"id":"f9139d8e-9b54-455e-9200-fac71054c320","block_type":"box","text":"In pursuing its investment strategy, a Fund may invest in shares of","page_number":97,"box":{"x":409,"y":370,"width":473,"height":11}},{"id":"038a7390-651b-4ef3-a8db-6c064e89b303","block_type":"box","text":"REITs. REITs possess certain risks which differ from an investment in common stocks. REITs are financial vehicles","page_number":97,"box":{"x":70,"y":385,"width":814,"height":11}},{"id":"55e38a3a-283d-4f3f-87a6-294487d62c62","block_type":"box","text":"that pool investor’s capital to purchase or finance real estate. REITs may concentrate their investments in specific","page_number":97,"box":{"x":68,"y":400,"width":814,"height":11}},{"id":"1e88ab45-e59c-45d1-b3f1-8b98d9d47d5e","block_type":"box","text":"geographic areas or in specific property types,","page_number":97,"box":{"x":68,"y":415,"width":329,"height":11}},{"id":"7d3ca0bb-4aa4-42bd-b78c-1522172afa2f","block_type":"box","text":"i.e.","page_number":97,"box":{"x":405,"y":415,"width":20,"height":9}},{"id":"0f5d9751-8b4a-492b-9df0-82538af7594d","block_type":"box","text":", hotels, shopping malls, residential complexes and office","page_number":97,"box":{"x":428,"y":415,"width":411,"height":11}},{"id":"ed6489ab-f026-4521-aca8-a5a9a9f17fc5","block_type":"box","text":"buildings.","page_number":97,"box":{"x":69,"y":430,"width":66,"height":11}},{"id":"7456b847-66c5-4a3c-a2cd-2bc0cd099f44","block_type":"box","text":"REITs are subject to management fees and other expenses, and so a Fund that invests in REITs will bear its","page_number":97,"box":{"x":102,"y":453,"width":768,"height":11}},{"id":"514bf99a-0c26-4d6d-96ff-5f7ccb816ae1","block_type":"box","text":"proportionate share of the costs of the REITs’ operations. There are three general categories of REITs: Equity REITs,","page_number":97,"box":{"x":70,"y":468,"width":824,"height":11}},{"id":"cddd5291-17c3-49fb-99f1-86260c7f9221","block_type":"box","text":"Mortgage REITs and Hybrid REITs. Equity REITs invest primarily in direct fee ownership or leasehold ownership of real","page_number":97,"box":{"x":70,"y":483,"width":829,"height":11}},{"id":"dfdb96b0-8785-4232-8bb7-406b34ce4903","block_type":"box","text":"property, which derive most of their income from rents. Mortgage REITs invest mostly in mortgages on real estate,","page_number":97,"box":{"x":70,"y":498,"width":813,"height":11}},{"id":"25e49713-5305-4c12-8999-2f78b43fe1b7","block_type":"box","text":"which may secure construction, development or long-term loans; the main source of their income is mortgage","page_number":97,"box":{"x":68,"y":513,"width":782,"height":12}},{"id":"35a27fe4-fdec-4c5f-944a-743978ad057d","block_type":"box","text":"interest payments. Hybrid REITs hold both ownership and mortgage interests in real estate.","page_number":97,"box":{"x":70,"y":529,"width":649,"height":11}},{"id":"f970f0cb-2edf-4671-ae1f-75e7bfcc9f61","block_type":"box","text":"Investing in REITs involves certain unique risks in addition to those risks associated with investing in the real","page_number":97,"box":{"x":102,"y":551,"width":776,"height":11}},{"id":"79a88bb4-94bb-41da-9493-d18450a1f2f5","block_type":"box","text":"estate industry in general. The market value of REIT shares and the ability of the REITs to distribute income may be","page_number":97,"box":{"x":69,"y":566,"width":822,"height":11}},{"id":"be79d5df-1964-4056-9dc7-160390a4f21e","block_type":"box","text":"adversely affected by several factors, including rising interest rates, changes in the national, state and local","page_number":97,"box":{"x":69,"y":581,"width":769,"height":12}},{"id":"5ea691c9-89b8-460b-b843-0307858a359e","block_type":"box","text":"economic climate and real estate conditions, occupancy and rental rates, perceptions of prospective tenants of the","page_number":97,"box":{"x":69,"y":596,"width":822,"height":12}},{"id":"25b04a43-6b04-4fb5-9a50-6f4feb22c64c","block_type":"box","text":"safety, convenience and attractiveness of the properties, the ability of the owners to provide adequate management,","page_number":97,"box":{"x":69,"y":612,"width":831,"height":11}},{"id":"a08e75ff-a96b-4bc4-9e03-60ba9d9e9e97","block_type":"box","text":"maintenance and insurance, the cost of complying with the Americans with Disabilities Act, increased competition","page_number":97,"box":{"x":69,"y":627,"width":810,"height":11}},{"id":"fdb5d4a7-4034-44f9-99c2-e21cacd48dd7","block_type":"box","text":"from new properties, the impact of present or future environmental legislation and compliance with environmental","page_number":97,"box":{"x":68,"y":642,"width":812,"height":11}},{"id":"3c3527ac-7866-4d9f-9d0b-ae364489b357","block_type":"box","text":"laws, failing to maintain their exemptions from registration under the Investment Company Act, changes in real estate","page_number":97,"box":{"x":70,"y":657,"width":838,"height":11}},{"id":"1b3b92d9-805b-480a-8728-047dd7bd89dd","block_type":"box","text":"taxes and other operating expenses, adverse changes in governmental rules and fiscal policies, adverse changes in","page_number":97,"box":{"x":68,"y":672,"width":826,"height":11}},{"id":"5c508842-79a2-4667-a276-8312b422ea0d","block_type":"box","text":"zoning laws and other factors beyond the control of the issuers of the REITs. To the extent that assets underlying a","page_number":97,"box":{"x":69,"y":687,"width":817,"height":11}},{"id":"7d5ac844-7bbf-46ca-b930-b84da53e562f","block_type":"box","text":"REIT are concentrated geographically, by property type, or in certain other respects, these risks may be heightened.","page_number":97,"box":{"x":70,"y":703,"width":822,"height":11}},{"id":"6be171bb-7e33-4ee6-ba37-1002b98856ef","block_type":"box","text":"In addition, distributions received by a Fund from REITs may consist of dividends, capital gains and/or return of","page_number":97,"box":{"x":70,"y":717,"width":792,"height":12}},{"id":"ac272b8f-437d-48d4-8fb0-855439f07c85","block_type":"box","text":"capital. As REITs generally pay a higher rate of dividends (on a pre-tax basis) than operating companies, to the extent","page_number":97,"box":{"x":69,"y":732,"width":834,"height":12}},{"id":"77162134-b147-475c-9142-8716e68d9033","block_type":"box","text":"application of the Fund’s investment strategy results in the Fund investing in REIT shares, the percentage of the","page_number":97,"box":{"x":69,"y":748,"width":798,"height":11}},{"id":"6cd27f1c-1be8-430f-a01b-3f294e91c698","block_type":"box","text":"Fund’s dividend income received from REIT shares will likely exceed the percentage of the Fund’s portfolio which is","page_number":97,"box":{"x":70,"y":763,"width":818,"height":11}},{"id":"064f680e-fe00-4ea5-8272-d46f766d1ccb","block_type":"box","text":"comprised of REIT shares. Ordinary REIT dividends received by the Fund and distributed to the Fund’s shareholders","page_number":97,"box":{"x":69,"y":778,"width":821,"height":11}},{"id":"644fa191-758f-47ea-b118-f591bc6d8c6e","block_type":"box","text":"will generally be taxable as ordinary income and will not constitute “qualified dividend income.” However, a non","page_number":97,"box":{"x":68,"y":793,"width":797,"height":11}},{"id":"595bc648-eed2-4f25-9d97-1cc1cff682b2","block_type":"box","text":"corporate taxpayer who is a direct REIT shareholder may claim a 20% “qualified business income” deduction for","page_number":97,"box":{"x":69,"y":808,"width":798,"height":11}},{"id":"524d7481-94a4-4398-95e6-9d1b360ee2e3","block_type":"box","text":"ordinary REIT dividends, and a regulated investment company may report dividends as eligible for this deduction to","page_number":97,"box":{"x":69,"y":823,"width":820,"height":12}},{"id":"07b6d0ea-6601-4cdd-9590-44fd57ae44a4","block_type":"box","text":"the extent the regulated investment company’s income is derived from ordinary REIT dividends (reduced by allocable","page_number":97,"box":{"x":68,"y":838,"width":831,"height":12}},{"id":"94898878-0e5a-4452-91da-36cf849dd575","block_type":"box","text":"regulated investment company expenses). A shareholder may treat the dividends as such provided the regulated","page_number":97,"box":{"x":69,"y":854,"width":801,"height":11}},{"id":"401813bc-819f-4a4e-ac56-5a0381722897","block_type":"box","text":"investment company and the shareholder satisfy applicable holding period requirements.","page_number":97,"box":{"x":70,"y":869,"width":631,"height":11}},{"id":"45654559-0b82-48c8-b4ed-f5c33543202b","block_type":"box","text":"REITs (especially mortgage REITs) are also subject to interest rate risk. Rising interest rates may cause REIT","page_number":97,"box":{"x":102,"y":891,"width":772,"height":12}},{"id":"3f29818a-0d04-4fa9-8295-7f785fe4e471","block_type":"box","text":"investors to demand a higher annual yield, which may, in turn, cause a decline in the market price of the equity","page_number":97,"box":{"x":70,"y":906,"width":790,"height":12}},{"id":"b649cb0e-a109-49a0-81f8-3111fccf333d","block_type":"box","text":"II-66","page_number":97,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"50ebffe2-c19a-42de-8ed0-e7aa1af48bda","block_type":"box","text":"NM0926U-5977317-97/232","page_number":97,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"72cd028a-7066-4005-bad6-4e9941a31ce9","block_type":"box","text":"securities issued by a REIT. Rising interest rates also generally increase the costs of obtaining financing, which could","page_number":98,"box":{"x":69,"y":45,"width":834,"height":11}},{"id":"9146d84f-e9f7-4aba-8e03-fb72242a5094","block_type":"box","text":"cause the value of a Fund’s REIT investments to decline. During periods when interest rates are declining, mortgages","page_number":98,"box":{"x":69,"y":60,"width":837,"height":11}},{"id":"73a40d2a-d3de-4ed3-baf3-91b0c3985585","block_type":"box","text":"are often refinanced. Refinancing may reduce the yield on investments in mortgage REITs. In addition, since REITs","page_number":98,"box":{"x":69,"y":75,"width":812,"height":11}},{"id":"57e6b5f9-94b2-4ef4-9933-2fbba9a21277","block_type":"box","text":"depend on payment under their mortgage loans and leases to generate cash to make distributions to their","page_number":98,"box":{"x":69,"y":90,"width":759,"height":11}},{"id":"7815b8c1-626f-4644-a364-e8f3fabf44b8","block_type":"box","text":"shareholders, investments in REITs may be adversely affected by defaults on such mortgage loans or leases.","page_number":98,"box":{"x":69,"y":105,"width":778,"height":11}},{"id":"5199626f-ba63-40ec-b6cb-fca22471202a","block_type":"box","text":"Investing in certain REITs, which often have small market capitalizations, may also involve the same risks as","page_number":98,"box":{"x":102,"y":128,"width":773,"height":11}},{"id":"eea81041-db12-4fc0-9ac4-ab563cce8737","block_type":"box","text":"investing in other small capitalization companies. REITs may have limited financial resources and their securities may","page_number":98,"box":{"x":70,"y":143,"width":836,"height":11}},{"id":"f9fad7a6-1e4e-4210-ade7-41dc061aea28","block_type":"box","text":"trade less frequently and in limited volume and may be subject to more abrupt or erratic price movements than larger","page_number":98,"box":{"x":68,"y":158,"width":839,"height":11}},{"id":"882b9be3-9f89-4b83-a229-bc54f2ff059a","block_type":"box","text":"company securities. Historically, small capitalization stocks, such as REITs, have been more volatile in price than the","page_number":98,"box":{"x":69,"y":173,"width":832,"height":11}},{"id":"33cff23c-f57f-4c50-a7ad-adae0656a442","block_type":"box","text":"larger capitalization stocks such as those included in the S&P 500 Index. The management of a REIT may be subject","page_number":98,"box":{"x":70,"y":188,"width":832,"height":12}},{"id":"63f2f169-e513-4f5b-9cce-5013361a0ceb","block_type":"box","text":"to conflicts of interest with respect to the operation of the business of the REIT and may be involved in real estate","page_number":98,"box":{"x":68,"y":203,"width":815,"height":12}},{"id":"990de755-d09e-4c4b-bdeb-4ce964b680ac","block_type":"box","text":"activities competitive with the REIT. REITs may own properties through joint ventures or in other circumstances in","page_number":98,"box":{"x":69,"y":219,"width":804,"height":11}},{"id":"1197af97-f294-4d32-948a-1d2f89191ab8","block_type":"box","text":"which the REIT may not have control over its investments. REITs may incur significant amounts of leverage.","page_number":98,"box":{"x":68,"y":234,"width":761,"height":11}},{"id":"210e3c18-0b1f-4324-8b06-01bf3112e95d","block_type":"box","text":"Market Risks/Recent Market Events.","page_number":98,"box":{"x":102,"y":256,"width":275,"height":11}},{"id":"ce15bb66-c59b-4f46-8cec-caccfea7e77c","block_type":"box","text":"Securities may decline in value due to factors affecting securities","page_number":98,"box":{"x":383,"y":256,"width":466,"height":12}},{"id":"a1980c51-36aa-4f4b-8a2c-93338941e640","block_type":"box","text":"markets generally or particular industries represented in the markets. The value of a security may decline due to","page_number":98,"box":{"x":69,"y":271,"width":801,"height":12}},{"id":"e38c2d0c-6393-44d8-b263-509e841f9f03","block_type":"box","text":"general market conditions, economic trends or events that are not specifically related to a company or to factors that","page_number":98,"box":{"x":68,"y":286,"width":837,"height":12}},{"id":"31ed0cfd-6fb5-4f12-a027-b2441d63cc57","block_type":"box","text":"affect a particular industry or industries, or factors that affect a particular issuer or issuers, exchange, country,","page_number":98,"box":{"x":69,"y":302,"width":795,"height":11}},{"id":"ad8682e2-2286-44bc-946b-44bcf78a3dfd","block_type":"box","text":"group of countries, region, market, industry, group of industries, sector or asset class. The success of a Fund’s","page_number":98,"box":{"x":68,"y":317,"width":796,"height":11}},{"id":"4b71637d-c8d3-4ad2-8dba-e66f88162274","block_type":"box","text":"activities could be affected by interest rates, availability of credit, inflation rates, economic uncertainty, changes in","page_number":98,"box":{"x":69,"y":332,"width":817,"height":11}},{"id":"184dc115-af0a-4992-88d2-4741a2052285","block_type":"box","text":"laws, trade barriers, economic sanctions, currency exchange controls, and local, regional or global events such as","page_number":98,"box":{"x":70,"y":347,"width":812,"height":11}},{"id":"db403243-0b8c-4626-9a44-2d4cc4495b8f","block_type":"box","text":"war, acts of terrorism, natural and environmental disasters, the spread of infectious illness or other public health","page_number":98,"box":{"x":68,"y":362,"width":807,"height":11}},{"id":"3a9daca7-e9b6-4a54-a75d-99e35bb949f2","block_type":"box","text":"issues, recessions, or other events could have a significant impact on a Fund and its investments. During a general","page_number":98,"box":{"x":70,"y":377,"width":822,"height":12}},{"id":"4586f928-afc4-4b1b-b4a6-de00feb41299","block_type":"box","text":"economic downturn in the securities markets, multiple asset classes may be negatively affected. These factors may","page_number":98,"box":{"x":69,"y":392,"width":828,"height":12}},{"id":"d113e39f-e1ca-40b5-ac6f-d21130108d9c","block_type":"box","text":"affect the level and volatility of securities prices and the liquidity of a Fund’s investments, which could impair the","page_number":98,"box":{"x":69,"y":407,"width":804,"height":12}},{"id":"9878c10e-8c7c-4fbd-9455-d8c0a2736d7e","block_type":"box","text":"Fund’s profitability or result in losses. A Fund may maintain substantial trading positions that can be adversely","page_number":98,"box":{"x":70,"y":423,"width":787,"height":11}},{"id":"480a565d-ba1f-452d-9bcc-37524009a751","block_type":"box","text":"affected by the level of volatility in the financial markets; the larger the positions, the greater the potential for loss.","page_number":98,"box":{"x":69,"y":438,"width":819,"height":11}},{"id":"6212b18d-2728-4d64-9e1b-367da73f4990","block_type":"box","text":"Unpredictable or unstable market conditions may result in reduced opportunities to find suitable investments to","page_number":98,"box":{"x":70,"y":453,"width":796,"height":11}},{"id":"d84206b0-578b-48b0-9c6e-459d22722109","block_type":"box","text":"deploy capital or make it more difficult to exit and realize value from a Fund’s existing investments. It is important to","page_number":98,"box":{"x":69,"y":468,"width":832,"height":11}},{"id":"13cb7bfa-2bde-400f-80aa-b73c875d6f32","block_type":"box","text":"understand that a Fund can incur material losses even if it reacts quickly to difficult market conditions and there can","page_number":98,"box":{"x":69,"y":483,"width":831,"height":11}},{"id":"b752c6a8-54b6-4c75-8dad-e83f2bb7f180","block_type":"box","text":"be no assurance that a Fund will not suffer material adverse effects from broad and rapid changes in market","page_number":98,"box":{"x":69,"y":498,"width":776,"height":11}},{"id":"87724fbb-b997-4727-9be4-4db087256b4a","block_type":"box","text":"conditions.","page_number":98,"box":{"x":69,"y":514,"width":76,"height":8}},{"id":"953eb26d-5bd8-488a-9597-97b8125a98f0","block_type":"box","text":"Periods of unusually high volatility in the financial markets and restrictive credit conditions, sometimes limited to","page_number":98,"box":{"x":102,"y":536,"width":802,"height":11}},{"id":"c117e3bd-8154-4ef0-af3d-fbd3baa5527b","block_type":"box","text":"a particular sector or a geography, can occur. Some countries, including the United States, have adopted and/or are","page_number":98,"box":{"x":69,"y":551,"width":829,"height":11}},{"id":"33399ff3-531e-4811-9497-5708bc5aa8ef","block_type":"box","text":"considering the adoption of more protectionist trade policies, a move away from the tighter financial industry","page_number":98,"box":{"x":69,"y":566,"width":775,"height":11}},{"id":"aede1a54-6319-4634-afb9-c860a5266080","block_type":"box","text":"regulations that followed the financial crisis of 2008, and/or substantially reducing corporate taxes. The exact shape","page_number":98,"box":{"x":69,"y":581,"width":833,"height":12}},{"id":"320d1cec-d88f-4eb2-9817-65f2ed4b91a5","block_type":"box","text":"of these policies is still being considered, but the equity and debt markets may react strongly to expectations of","page_number":98,"box":{"x":69,"y":596,"width":799,"height":12}},{"id":"8e068bcf-3423-4900-8cc5-3edba288fa01","block_type":"box","text":"change, which could increase volatility, especially if the market’s expectations are not borne out. A rise in","page_number":98,"box":{"x":69,"y":612,"width":751,"height":11}},{"id":"b8774044-6791-42c9-8266-d7befadb031a","block_type":"box","text":"protectionist trade policies, and the possibility of changes to some international trade agreements, could affect the","page_number":98,"box":{"x":70,"y":627,"width":822,"height":11}},{"id":"c59ee3ae-e38f-45a9-86a9-dfc37e941546","block_type":"box","text":"economies of many nations in ways that cannot necessarily be foreseen at the present time. In addition, geopolitical","page_number":98,"box":{"x":69,"y":642,"width":831,"height":11}},{"id":"31c2d8f5-b10a-49cf-8de8-c0145c3bec98","block_type":"box","text":"and other risks, including environmental and public health, may add to instability in world economies and markets","page_number":98,"box":{"x":69,"y":657,"width":810,"height":11}},{"id":"efa5f28b-0d17-4393-b790-2cba60cfb1d0","block_type":"box","text":"generally. Economies and financial markets throughout the world are increasingly interconnected. As a result, whether","page_number":98,"box":{"x":68,"y":672,"width":841,"height":11}},{"id":"d098becb-b2bf-477c-bcee-0d26bbbd1392","block_type":"box","text":"or not a Fund invests in securities of issuers located in or with significant exposure to countries experiencing","page_number":98,"box":{"x":69,"y":687,"width":775,"height":11}},{"id":"c021828a-5728-43d2-a089-e3552eab1872","block_type":"box","text":"economic, political and/or financial difficulties, the value and liquidity of the Fund’s investments may be negatively","page_number":98,"box":{"x":69,"y":702,"width":818,"height":12}},{"id":"dad2bcae-d0be-401c-a25b-26658d0d56eb","block_type":"box","text":"affected by such events.","page_number":98,"box":{"x":69,"y":717,"width":173,"height":12}},{"id":"d01faaa0-ccd9-46f3-a131-a0ec9784f1e1","block_type":"box","text":"Governments and regulators may take actions that affect the regulation of the Fund or the instruments in which","page_number":98,"box":{"x":102,"y":740,"width":795,"height":11}},{"id":"cb5e1d2e-8235-4e59-99fc-504a72e8230f","block_type":"box","text":"the Fund invests, or the issuers of such instruments, in ways that are unforeseeable. Future legislation or regulation","page_number":98,"box":{"x":68,"y":755,"width":830,"height":11}},{"id":"7fea1a2a-c0f8-4556-bfac-4b4ba1f8b801","block_type":"box","text":"or other governmental actions could limit or preclude the Fund’s abilities to achieve its investment objectives or","page_number":98,"box":{"x":69,"y":771,"width":796,"height":11}},{"id":"145ce4c6-78b3-4166-b68a-c5d79adc5b7a","block_type":"box","text":"otherwise adversely impact an investment in the Fund. Recent policy initiatives undertaken by the U.S. government","page_number":98,"box":{"x":69,"y":786,"width":820,"height":11}},{"id":"a604a373-4137-43be-a435-a2c8b2899e4b","block_type":"box","text":"have the potential to impact international relations, trade agreements and the overall regulatory environment in ways","page_number":98,"box":{"x":69,"y":801,"width":833,"height":11}},{"id":"243c8baa-10ef-4f6c-af4e-6898c9f643b4","block_type":"box","text":"that could create uncertainty and instability in domestic and global markets and could adversely affect the","page_number":98,"box":{"x":68,"y":816,"width":759,"height":11}},{"id":"82aef7e4-e4d0-491b-b79f-276c356d2f11","block_type":"box","text":"investment performance of the Fund. In particular, actions taken by the U.S. government in respect of international","page_number":98,"box":{"x":70,"y":831,"width":819,"height":11}},{"id":"4c3def70-98d8-4000-927d-ae09b0d74b4b","block_type":"box","text":"trade relations could lead to trade wars, increased costs for imported goods, disruptions in supply chains, reduced","page_number":98,"box":{"x":68,"y":846,"width":821,"height":11}},{"id":"b0243d12-f678-4da6-82fd-bef8ab81573d","block_type":"box","text":"foreign investment, and instability in regions where the Fund invests. Political and diplomatic events within the United","page_number":98,"box":{"x":68,"y":861,"width":837,"height":11}},{"id":"c9591068-9801-4d25-a909-916825388af9","block_type":"box","text":"States, including a contentious domestic political environment, changes in political party control of one or more","page_number":98,"box":{"x":69,"y":876,"width":795,"height":11}},{"id":"3a3c8b69-1c50-4576-9c19-54a137e37750","block_type":"box","text":"branches of the U.S. Government, the U.S. Government’s inability at times to agree on a long-term budget and deficit","page_number":98,"box":{"x":69,"y":891,"width":836,"height":12}},{"id":"c9ffe529-b6a2-4d58-b8b1-8a926a0619eb","block_type":"box","text":"reduction plan, the threat of a U.S. Government shutdown, and disagreements over, or threats not to increase, the","page_number":98,"box":{"x":69,"y":906,"width":817,"height":12}},{"id":"caa5271c-3cd8-46ce-92a7-b5ca27f3b652","block_type":"box","text":"II-67","page_number":98,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"56c1ce83-8c26-43fd-a887-5644b50a4798","block_type":"box","text":"NM0926U-5977317-98/232","page_number":98,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"0ebff707-3ca4-45da-af54-b30d7d8b7717","block_type":"box","text":"U.S. Government’s borrowing limit (or “debt ceiling”), as well as political and diplomatic events abroad, may affect","page_number":99,"box":{"x":70,"y":45,"width":816,"height":11}},{"id":"905222cf-4172-4e5d-b6ec-5f3553942529","block_type":"box","text":"investor and consumer confidence and may adversely impact financial markets and the broader economy, perhaps","page_number":99,"box":{"x":70,"y":60,"width":813,"height":11}},{"id":"f5c72290-6592-4db1-b77a-e470e63a5381","block_type":"box","text":"suddenly and to a significant degree. A downgrade of the ratings of U.S. Government debt obligations, or concerns","page_number":99,"box":{"x":69,"y":75,"width":815,"height":11}},{"id":"5cb7b984-5f6c-4c9f-a63d-5ab26545ef96","block_type":"box","text":"about the U.S. Government’s credit quality in general, could have a substantial negative effect on the U.S. and global","page_number":99,"box":{"x":69,"y":90,"width":836,"height":11}},{"id":"4152af0f-73c8-41fa-9d39-69beaeb5069a","block_type":"box","text":"economies. For example, concerns about the U.S. Government’s credit quality may cause increased volatility in the","page_number":99,"box":{"x":69,"y":105,"width":820,"height":11}},{"id":"97fe8fa6-b4e1-4c6d-ba19-032fcaa73f3f","block_type":"box","text":"stock and bond markets, higher interest rates, reduced prices and liquidity of U.S. Treasury securities, and/or","page_number":99,"box":{"x":69,"y":120,"width":785,"height":12}},{"id":"f2035503-1567-4da9-b555-854713ebf397","block_type":"box","text":"increased costs of various kinds of debt. Moreover, although the U.S. Government has honored its credit obligations,","page_number":99,"box":{"x":70,"y":135,"width":832,"height":12}},{"id":"b8af82ba-4f7a-4999-999d-2a9f391ff1cb","block_type":"box","text":"there remains a possibility that the United States could default on its obligations. The consequences of such an","page_number":99,"box":{"x":68,"y":150,"width":799,"height":12}},{"id":"b062ebb4-337e-4057-a77d-8333bfa1d54c","block_type":"box","text":"unprecedented event are impossible to predict, but it is likely that a default by the United States would be highly","page_number":99,"box":{"x":69,"y":166,"width":802,"height":11}},{"id":"af5ef8a9-61ae-4ad0-a692-f3be092e571a","block_type":"box","text":"disruptive to the U.S. and global securities markets and could significantly impair the value of the Fund’s","page_number":99,"box":{"x":69,"y":181,"width":746,"height":11}},{"id":"3c31ad89-57bb-49c6-92ee-2ec82596c303","block_type":"box","text":"investments.","page_number":99,"box":{"x":70,"y":196,"width":89,"height":9}},{"id":"eba502fb-b55e-43e4-9fd7-e65dc5f8b493","block_type":"box","text":"The COVID-19 pandemic resulted in significant market volatility, exchange suspensions and closures, declines in","page_number":99,"box":{"x":101,"y":218,"width":802,"height":12}},{"id":"76334ed6-eb5b-4a39-850a-ef2d34a5a878","block_type":"box","text":"global financial markets, higher default rates, supply chain disruptions, and a substantial economic downturn in","page_number":99,"box":{"x":68,"y":234,"width":796,"height":11}},{"id":"d2eb1da8-13fe-4305-886d-45b9cbbac73c","block_type":"box","text":"economies throughout the world. The impact of this coronavirus, and other epidemics and pandemics that may arise","page_number":99,"box":{"x":69,"y":249,"width":830,"height":11}},{"id":"d07febbb-00b3-4344-97f5-db6377451869","block_type":"box","text":"in the future, could affect the economies of many nations, individual companies and the market in general in ways","page_number":99,"box":{"x":70,"y":264,"width":813,"height":11}},{"id":"1e2d9e3d-cff2-4705-97bd-787b7f8a40ae","block_type":"box","text":"that cannot necessarily be foreseen at the present time. These health crises may be short term or long term, and","page_number":99,"box":{"x":68,"y":279,"width":812,"height":11}},{"id":"10600d37-7069-4270-8111-8511d070f556","block_type":"box","text":"may exacerbate other pre-existing political, social and economic risks, disrupt normal market conditions and","page_number":99,"box":{"x":69,"y":294,"width":771,"height":11}},{"id":"9a4109b7-d72a-4335-b272-52a84e3f2787","block_type":"box","text":"operations, and negatively impact performance. In addition, the impact of infectious diseases in emerging developing","page_number":99,"box":{"x":69,"y":309,"width":837,"height":11}},{"id":"f15999d8-6987-4fd5-bd95-7b505ebb0b43","block_type":"box","text":"or emerging market countries may be greater due to less established health care systems.","page_number":99,"box":{"x":69,"y":325,"width":646,"height":11}},{"id":"4133a547-3d36-407d-a25b-fbb433af40c6","block_type":"box","text":"Legal and Regulatory Risks.","page_number":99,"box":{"x":102,"y":347,"width":197,"height":11}},{"id":"af9d9c57-b6ce-47ee-a6c8-265775cd91bc","block_type":"box","text":"The Manager is part of a larger firm with multiple business lines active in multiple","page_number":99,"box":{"x":305,"y":347,"width":583,"height":11}},{"id":"14192e62-9c10-4feb-a70f-882ea0e18272","block_type":"box","text":"jurisdictions that are governed by a multitude of legal systems and regulatory regimes, some of which are new and","page_number":99,"box":{"x":67,"y":362,"width":819,"height":11}},{"id":"065fca8f-f4de-4808-91b3-08783ac7bedc","block_type":"box","text":"evolving. As a result, the Funds and the Manager and its affiliates are subject to extensive and sophisticated legal,","page_number":99,"box":{"x":69,"y":377,"width":820,"height":12}},{"id":"b7a6cc24-1293-49de-a27c-70777f5146e3","block_type":"box","text":"tax and regulatory risks, including changing laws and regulations, developing interpretations of such laws and","page_number":99,"box":{"x":68,"y":392,"width":781,"height":12}},{"id":"55830595-67b1-4ea0-b547-ada3e5ad6ee0","block_type":"box","text":"regulations, as well as existing laws, and increased scrutiny by regulators and law enforcement authorities.","page_number":99,"box":{"x":69,"y":407,"width":763,"height":12}},{"id":"1e0439f7-72b3-42dd-a3eb-2021cbb0b62d","block_type":"box","text":"Unexpected economic, political, regulatory and diplomatic events within the United States and abroad can trigger new","page_number":99,"box":{"x":70,"y":423,"width":838,"height":11}},{"id":"725d3357-0a55-48a8-8594-1aa59d355a3a","block_type":"box","text":"and complex regulations that the Manager and/or the Funds may need to comply with. The implementation of","page_number":99,"box":{"x":69,"y":438,"width":781,"height":11}},{"id":"a9223431-5f2b-4ba4-8150-efba6d8788e4","block_type":"box","text":"changes to comply with current and/or new regulations applicable to the Funds and/or the Manager could have a","page_number":99,"box":{"x":69,"y":453,"width":807,"height":11}},{"id":"28f5cf94-8191-496a-9b4c-1aeff6b7d717","block_type":"box","text":"material adverse effect on the Funds (including by imposing material costs on the Funds, reducing profit margins,","page_number":99,"box":{"x":69,"y":468,"width":807,"height":11}},{"id":"14c113ff-1c1d-4896-8764-d17fddefd97a","block_type":"box","text":"reducing investment opportunities or by otherwise restricting the Funds and/or the Manager).","page_number":99,"box":{"x":69,"y":483,"width":666,"height":11}},{"id":"28ee29cc-9e13-4d5c-8ec3-64bc11ff01a1","block_type":"box","text":"Tariff and Trade Policy Risks.","page_number":99,"box":{"x":103,"y":506,"width":202,"height":11}},{"id":"69170b0e-c463-4404-a98c-560e3f1b8291","block_type":"box","text":"Some countries, including the U.S., have adopted more protectionist trade policies.","page_number":99,"box":{"x":312,"y":506,"width":593,"height":11}},{"id":"53fdc8e0-c332-4af0-a65a-e25735180a52","block_type":"box","text":"The U.S. government recently altered its approach to international trade policy, resulting in significant impacts on","page_number":99,"box":{"x":68,"y":521,"width":806,"height":11}},{"id":"a8549298-5be7-426b-b3ae-ece4064f0dc9","block_type":"box","text":"international trade relations, certain tax and immigration policies, and other aspects of the national and international","page_number":99,"box":{"x":70,"y":536,"width":833,"height":11}},{"id":"a42a0206-8f0e-40da-a5b2-287a6472885d","block_type":"box","text":"political and financial landscape. The rise in protectionist trade policies, slowing economic growth, changes to some","page_number":99,"box":{"x":70,"y":551,"width":827,"height":11}},{"id":"a4da9810-73a5-4286-a98f-99dfff5cf12e","block_type":"box","text":"major international trade agreements, risks associated with trade agreements between the U.S. and the European","page_number":99,"box":{"x":69,"y":566,"width":814,"height":11}},{"id":"1ea5ce81-d2b4-4c89-be8f-15c0c7f85cfa","block_type":"box","text":"Union, and the risks associated with trade negotiations between the U.S. and China, could affect the economies of","page_number":99,"box":{"x":70,"y":581,"width":821,"height":12}},{"id":"3b5868c0-c0c5-421b-aa97-ba9575caeb29","block_type":"box","text":"many nations in ways that cannot necessarily be foreseen at the present time.","page_number":99,"box":{"x":69,"y":596,"width":559,"height":12}},{"id":"c93a8cd3-2d6f-4ad1-8d25-ae1d61a500a9","block_type":"box","text":"Global trade disruption, significant introductions of trade barriers, and bilateral trade frictions, together with any","page_number":99,"box":{"x":102,"y":619,"width":796,"height":11}},{"id":"54b00a10-3847-49b4-b324-8f10cd468b52","block_type":"box","text":"future downturns in the global economy resulting therefrom, could adversely affect the financial performance of a","page_number":99,"box":{"x":68,"y":634,"width":809,"height":12}},{"id":"7fd60002-6589-413a-819b-57c32fa83372","block_type":"box","text":"Fund and its investments. Trade policy may be an ongoing source of instability, potentially resulting in significant","page_number":99,"box":{"x":70,"y":649,"width":799,"height":12}},{"id":"8e5c538b-55b6-48b8-b07c-b799795c2d67","block_type":"box","text":"currency fluctuations and/or having other adverse effects on international markets, international trade agreements,","page_number":99,"box":{"x":69,"y":664,"width":823,"height":12}},{"id":"cbcaf12a-e3b3-41a0-b422-56c32859a968","block_type":"box","text":"and/or other existing cross-border cooperation arrangements (whether economic, tax, fiscal, legal, regulatory, or","page_number":99,"box":{"x":69,"y":680,"width":801,"height":11}},{"id":"c15a8190-3468-45ae-b763-0982eda71f60","block_type":"box","text":"otherwise). To the extent trade disputes escalate globally, there could be additional significant impacts on the","page_number":99,"box":{"x":69,"y":695,"width":783,"height":11}},{"id":"22f367b5-4292-4329-b4eb-95ea49a3f447","block_type":"box","text":"sectors or industries in which a Fund invests and other adverse impacts on a Fund’s overall performance.","page_number":99,"box":{"x":69,"y":710,"width":753,"height":11}},{"id":"909d2328-c620-439e-9a21-8f26f3d2f861","block_type":"box","text":"Geographic Risks","page_number":99,"box":{"x":102,"y":733,"width":123,"height":11}},{"id":"74785ef3-ee17-4a88-a9b0-4dce6652c5d5","block_type":"box","text":". Some of the companies in which the Fund invests may be located in, or otherwise connected","page_number":99,"box":{"x":226,"y":732,"width":671,"height":12}},{"id":"4be5ace0-7080-426e-88e4-8dddac1e8db0","block_type":"box","text":"to, parts of the world affected by natural disasters such as severe heat, earthquakes, tornadoes, volcanic eruptions,","page_number":99,"box":{"x":68,"y":748,"width":835,"height":11}},{"id":"24b37746-4cbc-4362-b00b-3a4cb2b79e83","block_type":"box","text":"wildfires, droughts, floods, hurricanes or tsunamis, and are economically sensitive to environmental events. In","page_number":99,"box":{"x":68,"y":763,"width":787,"height":11}},{"id":"23239465-e679-4d60-8902-7c7cba28d599","block_type":"box","text":"addition, issuers may be impacted by security concerns with respect to a country or region, such as war and other","page_number":99,"box":{"x":69,"y":778,"width":814,"height":11}},{"id":"4b5d5c30-5546-45df-9ad7-9dff6c081cf1","block_type":"box","text":"types of conflict, terrorism, strained international relations and territorial disputes. Any of these events may adversely","page_number":99,"box":{"x":68,"y":793,"width":840,"height":11}},{"id":"057305c4-d639-45e2-970e-127ef6583fa4","block_type":"box","text":"affect the issuers, markets and economies to which a Fund is exposed, which may adversely affect the value of the","page_number":99,"box":{"x":69,"y":808,"width":824,"height":11}},{"id":"1803cd86-8c62-49f9-8a50-f9db0fa6ce12","block_type":"box","text":"Fund.","page_number":99,"box":{"x":70,"y":823,"width":36,"height":9}},{"id":"6b991bdb-bb98-4ad0-b947-d502fc41b1fb","block_type":"box","text":"Reference Rate Replacement Risk.","page_number":99,"box":{"x":102,"y":846,"width":255,"height":11}},{"id":"b48ba565-f158-4b08-844c-86decb230df4","block_type":"box","text":"A Fund’s investments, payment obligations and financing terms may be","page_number":99,"box":{"x":363,"y":846,"width":508,"height":11}},{"id":"e6a902c0-e250-4a91-bbdf-21c1eb9d1d79","block_type":"box","text":"based on floating rates, such as the Secured Overnight Financing Rate (“SOFR”), Sterling Overnight Interbank Average","page_number":99,"box":{"x":69,"y":861,"width":839,"height":11}},{"id":"df320e36-0a56-472a-bf73-039d9d1d5909","block_type":"box","text":"Rate (“SONIA”), and other similar types of reference rates (“Reference Rates”). The elimination of a Reference Rate","page_number":99,"box":{"x":70,"y":876,"width":825,"height":11}},{"id":"b13e812b-8c2a-4c41-bfcc-99fa17850bcf","block_type":"box","text":"or any other changes or reforms to the determination or supervision of a Reference Rate could have an adverse","page_number":99,"box":{"x":69,"y":891,"width":797,"height":12}},{"id":"cb8534f8-03fc-47c3-ab3a-5c38ffe0e461","block_type":"box","text":"impact on the market for, or value of, any instruments (including debt instruments and certain derivative instruments)","page_number":99,"box":{"x":70,"y":906,"width":837,"height":12}},{"id":"b985d32d-4862-48b1-bd6f-5127a240c97f","block_type":"box","text":"II-68","page_number":99,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"4e4571d4-e863-4c17-9e85-cfffc1b2475a","block_type":"box","text":"NM0926U-5977317-99/232","page_number":99,"box":{"x":764,"y":970,"width":147,"height":7}},{"id":"d60abe02-ddf2-42f2-aaee-75e6e2632a71","block_type":"box","text":"or payments linked to those Reference Rates. In addition, any substitute Reference Rate and any pricing adjustments","page_number":100,"box":{"x":69,"y":45,"width":837,"height":11}},{"id":"28328a86-302f-49da-be7a-19878b553ea4","block_type":"box","text":"imposed by a regulator or by counterparties or otherwise may adversely affect a Fund’s performance and/or net","page_number":100,"box":{"x":70,"y":60,"width":800,"height":11}},{"id":"354188f9-edc5-404f-a87c-b7b6dee23666","block_type":"box","text":"asset value. The London Interbank Offered Rate (“LIBOR”) had historically been used extensively in the U.S. and","page_number":100,"box":{"x":69,"y":75,"width":800,"height":11}},{"id":"b33b72a3-fedc-4e47-b5b5-f345796f75f2","block_type":"box","text":"globally as a “benchmark” or “reference rate” for various commercial and financial contracts, including corporate and","page_number":100,"box":{"x":68,"y":90,"width":836,"height":11}},{"id":"daadba0d-c57d-43ef-a93f-6ff7a07f7b87","block_type":"box","text":"municipal bonds, bank loans, asset-backed and mortgage-related securities, interest rate swaps and other","page_number":100,"box":{"x":69,"y":105,"width":761,"height":11}},{"id":"2420078f-509c-45ab-80ac-80bf1209a391","block_type":"box","text":"derivatives. Instruments in which a Fund may have historically paid interest at floating rates based on LIBOR or may","page_number":100,"box":{"x":69,"y":120,"width":824,"height":12}},{"id":"1c97031b-013f-441f-84e2-7d10b872eeb9","block_type":"box","text":"have been subject to interest caps or floors based on LIBOR. The Funds and issuers of instruments in which a Fund","page_number":100,"box":{"x":69,"y":135,"width":825,"height":11}},{"id":"4e99122d-f1bb-4ce5-82be-b6ff928a87b3","block_type":"box","text":"invests may have also historically obtained financing at floating rates based on LIBOR. In connection with the global","page_number":100,"box":{"x":70,"y":150,"width":822,"height":12}},{"id":"e85866b0-3b86-4989-87aa-9771359169ed","block_type":"box","text":"transition away from LIBOR led by regulators and market participants as a result of benchmark reforms, LIBOR was","page_number":100,"box":{"x":68,"y":166,"width":822,"height":11}},{"id":"67f9d771-7a0b-49d5-98ea-652c744a8453","block_type":"box","text":"last published on a representative basis at the end of June 2023. Alternative Reference Rates to LIBOR have been","page_number":100,"box":{"x":70,"y":181,"width":817,"height":11}},{"id":"962d5a2b-1bab-43a5-bc88-f06c6d218a92","block_type":"box","text":"established in most major currencies and markets in these alternative rates are continuing to develop (","page_number":100,"box":{"x":69,"y":196,"width":736,"height":11}},{"id":"2b02efbf-29be-41e1-9835-c6f8a397201e","block_type":"box","text":"e.g.","page_number":100,"box":{"x":807,"y":197,"width":25,"height":10}},{"id":"b984f6ee-bd28-4f2a-a70c-c45c9fa20033","block_type":"box","text":", SOFR for","page_number":100,"box":{"x":835,"y":196,"width":70,"height":10}},{"id":"04a0651b-9584-4ede-b08b-6f6b0494d552","block_type":"box","text":"USD-LIBOR and SONIA for GBP-LIBOR). While the transition from LIBOR has gone relatively smoothly, residual risks","page_number":100,"box":{"x":70,"y":211,"width":814,"height":11}},{"id":"c70de1b1-3bd8-49a5-8975-289bd353554c","block_type":"box","text":"associated with the transition may remain that may impact markets or particular investments and, as such, the full","page_number":100,"box":{"x":69,"y":226,"width":820,"height":11}},{"id":"f9b080a4-ca2a-49ae-9a91-c83f867f0e81","block_type":"box","text":"impact of the transition on the Funds or the financial instruments in which the Funds invest cannot yet be fully","page_number":100,"box":{"x":70,"y":241,"width":784,"height":11}},{"id":"5be6e00c-a033-4970-b410-ef1fb127df5c","block_type":"box","text":"determined.","page_number":100,"box":{"x":69,"y":257,"width":84,"height":8}},{"id":"7a01ce11-20ba-42b4-bbc2-2ae7cca67d65","block_type":"box","text":"SOFR is intended to be a broad measure of the cost of borrowing funds overnight in transactions that are","page_number":100,"box":{"x":102,"y":279,"width":750,"height":11}},{"id":"4b4c9f77-2240-40be-b22a-d77d0bfc4cd1","block_type":"box","text":"collateralized by U.S. Treasury securities. SOFR is calculated based on transaction-level repo data collected from","page_number":100,"box":{"x":69,"y":294,"width":803,"height":11}},{"id":"c808e42c-1147-4c74-80f4-852a9abea767","block_type":"box","text":"various sources. For each trading day, SOFR is calculated as a volume-weighted median rate derived from such data.","page_number":100,"box":{"x":68,"y":309,"width":831,"height":11}},{"id":"7e201f5b-c16c-4810-a394-e5560e2b5a51","block_type":"box","text":"Because SOFR is a financing rate based on overnight secured funding transactions, it differs fundamentally from","page_number":100,"box":{"x":70,"y":324,"width":801,"height":12}},{"id":"e06786ae-6d25-462b-aa9c-b7002f47a376","block_type":"box","text":"LIBOR. LIBOR is intended to be an unsecured rate that represents interbank funding costs for different short-term","page_number":100,"box":{"x":70,"y":339,"width":810,"height":12}},{"id":"dfc374fe-a781-45d1-91b5-0a4ab589048d","block_type":"box","text":"maturities or tenors. It is a forward-looking rate reflecting expectations regarding interest rates for the applicable","page_number":100,"box":{"x":69,"y":355,"width":803,"height":11}},{"id":"c6779cde-44a1-45ab-9c5b-7e9886651a1c","block_type":"box","text":"tenor. Thus, LIBOR is intended to be sensitive, in certain respects, to bank credit risk and to term interest rate risk.","page_number":100,"box":{"x":68,"y":370,"width":825,"height":11}},{"id":"61069f35-08dc-40e5-ab36-6080b33ed608","block_type":"box","text":"In contrast, SOFR is a secured overnight rate reflecting the credit of U.S. Treasury securities as collateral. Thus, it is","page_number":100,"box":{"x":70,"y":385,"width":828,"height":11}},{"id":"97334c7a-8d62-4142-8a9c-65956bae146e","block_type":"box","text":"largely insensitive to credit-risk considerations and to short-term interest rate risks. SOFR is a transaction-based rate,","page_number":100,"box":{"x":70,"y":400,"width":838,"height":11}},{"id":"24432c8d-c834-495e-9a0b-4b27117b9fd3","block_type":"box","text":"and it has been more volatile than other benchmark or market rates, such as three-month LIBOR, during certain","page_number":100,"box":{"x":69,"y":415,"width":796,"height":11}},{"id":"83c63340-8851-4969-8558-87992ce18e93","block_type":"box","text":"periods. For these reasons, among others, there is no assurance that SOFR, or rates derived from SOFR, will perform","page_number":100,"box":{"x":70,"y":430,"width":836,"height":11}},{"id":"b7f56a96-12e5-4cc6-86bd-8642b7f7c109","block_type":"box","text":"in the same or similar way as LIBOR would have performed at any time, and there is no assurance that SOFR-based","page_number":100,"box":{"x":70,"y":445,"width":824,"height":11}},{"id":"256f3f03-9a48-4ae7-8304-58233b905a2e","block_type":"box","text":"rates will be a suitable substitute for LIBOR. SOFR has a relatively limited history, having been first published in April","page_number":100,"box":{"x":69,"y":460,"width":830,"height":12}},{"id":"04446dba-d965-4e8d-9d65-ca357a92edbd","block_type":"box","text":"2018. The future performance of SOFR, and SOFR-based Reference Rates, cannot be predicted based on SOFR’s","page_number":100,"box":{"x":69,"y":475,"width":809,"height":11}},{"id":"8cd5d2e0-c241-439b-b4cf-88ad0623fd95","block_type":"box","text":"history or otherwise. Levels of SOFR in the future may bear little or no relation to historical levels of SOFR, LIBOR or","page_number":100,"box":{"x":69,"y":491,"width":827,"height":11}},{"id":"fd43eb79-4aba-4503-ae3c-c3ec345ebd9d","block_type":"box","text":"other rates. There can also be no assurance that SOFR will not be discontinued or fundamentally altered in a manner","page_number":100,"box":{"x":69,"y":506,"width":835,"height":11}},{"id":"f087c1e1-c4e4-4aae-b7dc-513588022279","block_type":"box","text":"that is materially adverse to the interests of the Fund.","page_number":100,"box":{"x":68,"y":521,"width":384,"height":11}},{"id":"62726156-8c61-41bc-aaa1-3c44f2e0530b","block_type":"box","text":"In addition, interest rates or other types of rates and indices which are classified as “benchmarks” have been","page_number":100,"box":{"x":102,"y":543,"width":782,"height":12}},{"id":"3f70749c-c699-4b03-aad1-0a95d12d165c","block_type":"box","text":"the subject of ongoing national and international regulatory reform, including under the European Union (“EU”)","page_number":100,"box":{"x":68,"y":559,"width":786,"height":11}},{"id":"ee5b348a-9a5e-42d2-85a1-a953fb96c0bf","block_type":"box","text":"regulation on indices used as benchmarks in financial instruments and financial contracts (known as the","page_number":100,"box":{"x":69,"y":574,"width":746,"height":11}},{"id":"cac3c443-45f1-40c8-9650-7077c333fa85","block_type":"box","text":"“Benchmarks Regulation”). The Benchmarks Regulation has been enacted into United Kingdom (“UK”) law by virtue","page_number":100,"box":{"x":70,"y":589,"width":822,"height":11}},{"id":"a2a88a6c-1be9-49a7-a7c7-e7a8b91bc49e","block_type":"box","text":"of the EU (Withdrawal) Act 2018 (as amended), subject to amendments made by the Benchmarks (Amendment and","page_number":100,"box":{"x":69,"y":604,"width":821,"height":11}},{"id":"0338d2cc-7eef-4deb-be55-d195893b3796","block_type":"box","text":"Transitional Provision) (EU Exit) Regulations 2019 (SI 2019/657) and other statutory instruments. Following the","page_number":100,"box":{"x":68,"y":619,"width":799,"height":11}},{"id":"0a518f12-f7b4-4b39-8a70-6e4733194e0b","block_type":"box","text":"implementation of these reforms, the manner of administration of benchmarks has changed and may further change","page_number":100,"box":{"x":70,"y":634,"width":830,"height":12}},{"id":"a5784e60-d0eb-413d-84fe-a149510b571c","block_type":"box","text":"in the future, with the result that relevant benchmarks may perform differently than in the past, the use of","page_number":100,"box":{"x":70,"y":649,"width":757,"height":12}},{"id":"f4022148-785b-4f05-8e8d-01e76cbd32fd","block_type":"box","text":"benchmarks that are not compliant with the new standards by certain supervised entities may be restricted, and","page_number":100,"box":{"x":69,"y":665,"width":802,"height":11}},{"id":"074beeca-2f8a-45dc-b07f-2fde364f7ee0","block_type":"box","text":"certain benchmarks may be eliminated entirely. Such changes could cause increased market volatility and disruptions","page_number":100,"box":{"x":69,"y":680,"width":840,"height":11}},{"id":"96d9fa42-8efc-4d94-946f-d907ffeb22d7","block_type":"box","text":"in liquidity for instruments that rely on or are impacted by such benchmarks. Additionally, there could be other","page_number":100,"box":{"x":70,"y":695,"width":782,"height":11}},{"id":"a0a2ee8c-a356-4cf2-a950-4a0c85cd8650","block_type":"box","text":"consequences which cannot be predicted.","page_number":100,"box":{"x":69,"y":710,"width":298,"height":11}},{"id":"52f079dd-1e9a-4165-8473-c7ae2216caa5","block_type":"box","text":"Repurchase Agreements and Purchase and Sale Contracts.","page_number":100,"box":{"x":102,"y":733,"width":432,"height":11}},{"id":"7e988551-c0f9-4a76-bc71-db27dc165141","block_type":"box","text":"Under repurchase agreements and purchase and","page_number":100,"box":{"x":541,"y":733,"width":347,"height":11}},{"id":"a5ac073c-ec14-4a86-a65a-edcb4bf024cc","block_type":"box","text":"sale contracts, the other party agrees, upon entering into the contract with a Fund, to repurchase a security sold to","page_number":100,"box":{"x":69,"y":748,"width":821,"height":11}},{"id":"7b0a87f7-4a99-4f55-9ce1-49f5a100703e","block_type":"box","text":"the Fund at a mutually agreed-upon time and price in a specified currency, thereby determining the yield during the","page_number":100,"box":{"x":68,"y":763,"width":815,"height":11}},{"id":"66a9c1cb-d358-4275-beac-5f4400a0bde4","block_type":"box","text":"term of the agreement.","page_number":100,"box":{"x":68,"y":778,"width":164,"height":11}},{"id":"8f5081e5-ccc8-4fdc-be34-1b66489e387b","block_type":"box","text":"A purchase and sale contract differs from a repurchase agreement in that the contract arrangements stipulate","page_number":100,"box":{"x":101,"y":801,"width":788,"height":11}},{"id":"787f4e48-7937-41a1-916f-381875edbd9a","block_type":"box","text":"that securities are owned by the Fund and the purchaser receives any interest on the security paid during the period.","page_number":100,"box":{"x":68,"y":816,"width":831,"height":11}},{"id":"08046ad6-ecdf-4e8a-8d66-ed0458cf3eb7","block_type":"box","text":"In the case of repurchase agreements, the prices at which the trades are conducted do not reflect accrued interest","page_number":100,"box":{"x":70,"y":831,"width":821,"height":11}},{"id":"644b4fb7-fbc2-480d-8cbb-de12b66e85b9","block_type":"box","text":"on the underlying obligation; whereas, in the case of purchase and sale contracts, the prices take into account","page_number":100,"box":{"x":69,"y":846,"width":790,"height":11}},{"id":"46f9253b-adcb-434d-81a7-5d14f37724c0","block_type":"box","text":"accrued interest. A Fund may enter into “tri-party” repurchase agreements. In “tri-party” repurchase agreements, an","page_number":100,"box":{"x":69,"y":861,"width":827,"height":11}},{"id":"202525ae-1e6b-4519-aec7-e075b9497cef","block_type":"box","text":"unaffiliated third-party custodian maintains accounts to hold collateral for the Fund and its counterparties and,","page_number":100,"box":{"x":69,"y":876,"width":788,"height":11}},{"id":"eb2e1897-23b6-4615-90d1-7d7d816a9d56","block_type":"box","text":"therefore, the Fund may be subject to the credit risk of those custodians.","page_number":100,"box":{"x":68,"y":891,"width":522,"height":11}},{"id":"dcc71cca-ee40-4532-b116-c1a70360975b","block_type":"box","text":"II-69","page_number":100,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"01ed0dab-f7e3-4026-be27-5fff15ab6d67","block_type":"box","text":"NM0926U-5977317-100/232","page_number":100,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"d09608a2-9d6f-4f0d-a906-9295b3619f15","block_type":"box","text":"Some repurchase agreements and purchase and sale contracts are structured to result in a fixed rate of return","page_number":101,"box":{"x":102,"y":45,"width":792,"height":11}},{"id":"958abe2e-05bf-4c12-b315-dc0a737edf89","block_type":"box","text":"insulated from market fluctuations during the term of the agreement, although such return may be affected by","page_number":101,"box":{"x":70,"y":60,"width":784,"height":11}},{"id":"57bf2ae3-b822-47b6-a05a-0d2b7a23bdf0","block_type":"box","text":"currency fluctuations. However, in the event of a default under a repurchase agreement or under a purchase and sale","page_number":101,"box":{"x":69,"y":75,"width":837,"height":11}},{"id":"720d43a4-bb62-4605-ab21-143787e3ac0e","block_type":"box","text":"contract, instead of the contractual fixed rate, the rate of return to the Fund would be dependent upon intervening","page_number":101,"box":{"x":69,"y":90,"width":812,"height":11}},{"id":"edd3a311-8f83-48ca-a98c-66455a165a4e","block_type":"box","text":"fluctuations of the market values of the securities underlying the contract and the accrued interest on those","page_number":101,"box":{"x":68,"y":105,"width":770,"height":11}},{"id":"99f9a88f-ba3f-4892-8838-6cd8d63cd576","block_type":"box","text":"securities. In such event, the Fund would have rights against the seller for breach of contract with respect to any","page_number":101,"box":{"x":69,"y":120,"width":802,"height":12}},{"id":"1fea3acd-e920-42c1-b202-8a4ef0bc063e","block_type":"box","text":"losses arising from market fluctuations following the default.","page_number":101,"box":{"x":70,"y":135,"width":430,"height":12}},{"id":"b4b15409-e00a-43f1-b1cd-48e89faf46f4","block_type":"box","text":"Both types of agreement usually cover short periods, such as less than one week, although they may have","page_number":101,"box":{"x":102,"y":158,"width":759,"height":11}},{"id":"3f9249c9-0648-4e3f-91af-591f334ae4df","block_type":"box","text":"longer terms, and may be construed to be collateralized loans by the purchaser to the seller secured by the","page_number":101,"box":{"x":70,"y":173,"width":765,"height":11}},{"id":"c0ac8dca-934a-46d2-9a4f-d66ed699f157","block_type":"box","text":"securities transferred to the purchaser. In the case of a repurchase agreement, as a purchaser, a Fund’s Manager or","page_number":101,"box":{"x":69,"y":188,"width":835,"height":12}},{"id":"94d21b8f-b01c-4371-a897-0da514094908","block_type":"box","text":"sub-adviser will monitor the creditworthiness of the seller, and a Fund will require the seller to provide additional","page_number":101,"box":{"x":69,"y":203,"width":799,"height":11}},{"id":"a4884787-de53-49fc-b0f1-942b50633be1","block_type":"box","text":"collateral if the market value of the securities falls below the repurchase price at any time during the term of the","page_number":101,"box":{"x":69,"y":218,"width":801,"height":12}},{"id":"591f2f1b-045f-4ada-ae33-62d44e198456","block_type":"box","text":"repurchase agreement. The Fund does not have this right to seek additional collateral as a purchaser in the case of","page_number":101,"box":{"x":69,"y":234,"width":826,"height":11}},{"id":"90c51374-3ff9-4f8b-9852-7aef99b00027","block_type":"box","text":"purchase and sale contracts. The Fund’s Manager or sub-adviser will mark-to-market daily the value of the securities.","page_number":101,"box":{"x":70,"y":249,"width":831,"height":11}},{"id":"691e7e11-c547-4566-a8c8-a724588dc86d","block_type":"box","text":"Securities subject to repurchase agreements (other than tri-party repurchase agreements) and purchase and sale","page_number":101,"box":{"x":69,"y":264,"width":810,"height":11}},{"id":"f9299063-6346-4efa-8c1a-a4b05c0f1d42","block_type":"box","text":"contracts will be held by the Fund’s custodian (or sub-custodian) in the Federal Reserve/Treasury book-entry system","page_number":101,"box":{"x":69,"y":279,"width":829,"height":11}},{"id":"24e13749-6ab6-433f-b28e-7f5637228048","block_type":"box","text":"or by another authorized securities depository.","page_number":101,"box":{"x":69,"y":294,"width":329,"height":11}},{"id":"85518bfb-a6e7-4715-80f8-3e459ffaca7e","block_type":"box","text":"In the event of default by the seller under a repurchase agreement construed to be a collateralized loan, the","page_number":101,"box":{"x":102,"y":317,"width":770,"height":11}},{"id":"db8982c5-5bca-464e-9f20-d470ad41bd4d","block_type":"box","text":"underlying securities are not owned by the Fund but only constitute collateral for the seller’s obligation to pay the","page_number":101,"box":{"x":69,"y":332,"width":805,"height":11}},{"id":"f500f5df-f771-4bb6-8cd1-7bd213782f09","block_type":"box","text":"repurchase price. Therefore, the Fund may suffer time delays and incur costs or possible losses in connection with","page_number":101,"box":{"x":69,"y":347,"width":819,"height":11}},{"id":"b8743130-45fb-4d00-9e38-896ff2c4fc25","block_type":"box","text":"disposition of the collateral. If the seller becomes insolvent and subject to liquidation or reorganization under","page_number":101,"box":{"x":69,"y":362,"width":778,"height":11}},{"id":"b570ad0f-b411-410b-8a89-f683fe2badc0","block_type":"box","text":"applicable bankruptcy or other laws, a Fund’s ability to dispose of the underlying securities may be restricted. Finally,","page_number":101,"box":{"x":69,"y":377,"width":832,"height":12}},{"id":"57af1de1-0e89-4c06-8dc5-34ed4562801c","block_type":"box","text":"it is possible that a Fund may not be able to substantiate its interest in the underlying securities. To minimize this","page_number":101,"box":{"x":70,"y":393,"width":810,"height":11}},{"id":"21794463-7c8b-45d1-8523-5fc17e69ae64","block_type":"box","text":"risk, the securities underlying the repurchase agreement will be held by the applicable custodian at all times in an","page_number":101,"box":{"x":69,"y":408,"width":812,"height":11}},{"id":"15c95fa0-edec-4683-af56-253cc4c81592","block_type":"box","text":"amount at least equal to the repurchase price, including accrued interest. If the seller fails to repurchase the","page_number":101,"box":{"x":69,"y":423,"width":778,"height":11}},{"id":"df0b2ebb-f358-4e09-965f-9824bcde4220","block_type":"box","text":"securities, a Fund may suffer a loss to the extent proceeds from the sale of the underlying securities are less than","page_number":101,"box":{"x":69,"y":438,"width":817,"height":11}},{"id":"5c18aabb-c86a-4c3d-b283-0f42cde63e16","block_type":"box","text":"the repurchase price.","page_number":101,"box":{"x":68,"y":453,"width":151,"height":11}},{"id":"301fbda1-a77d-487b-b1de-dd1d3da95f66","block_type":"box","text":"In any repurchase transaction to which a Fund is a party, collateral for a repurchase agreement may include cash","page_number":101,"box":{"x":102,"y":475,"width":805,"height":12}},{"id":"acbeee4d-7ad7-45c3-82f3-f04356036941","block_type":"box","text":"items and obligations issued by the U.S. Government or its agencies or instrumentalities. For certain Funds, however,","page_number":101,"box":{"x":70,"y":491,"width":837,"height":11}},{"id":"323e0aa3-790d-4c5c-a821-7a3dea850c5c","block_type":"box","text":"collateral may include instruments other than cash items and obligations issued by the U.S. Government or its","page_number":101,"box":{"x":69,"y":506,"width":788,"height":11}},{"id":"6071c5f5-b854-438d-b91a-df872ac31c8b","block_type":"box","text":"agencies or instrumentalities, including securities that the Fund could not hold directly under its investment","page_number":101,"box":{"x":69,"y":521,"width":767,"height":11}},{"id":"10091500-2d3c-4992-9e13-dc43e14110e9","block_type":"box","text":"strategies without the repurchase obligation.","page_number":101,"box":{"x":69,"y":536,"width":317,"height":11}},{"id":"55288e8e-ab76-4d94-8dfd-9c7ce7588158","block_type":"box","text":"The type of collateral underlying repurchase agreements may also pose certain risks for a Fund. Lower quality","page_number":101,"box":{"x":101,"y":559,"width":782,"height":11}},{"id":"02eff1b3-e54b-4867-ad7b-48f11e1b0a5f","block_type":"box","text":"collateral and collateral with longer maturities may be subject to greater price fluctuations than higher quality","page_number":101,"box":{"x":69,"y":574,"width":776,"height":11}},{"id":"648a3c19-0a63-4751-a22f-04092ec65309","block_type":"box","text":"collateral and collateral with shorter maturities. If the repurchase agreement counterparty were to default, lower","page_number":101,"box":{"x":69,"y":589,"width":799,"height":11}},{"id":"2184efdc-208a-483b-b296-e2e8212b5f7f","block_type":"box","text":"quality collateral may be more difficult to liquidate than higher quality collateral. Should the counterparty default and","page_number":101,"box":{"x":69,"y":604,"width":829,"height":11}},{"id":"df6f0905-9d7e-4edb-9734-b0ad8dc4ab9c","block_type":"box","text":"the amount of collateral not be sufficient to cover the counterparty’s repurchase obligation, a Fund would retain the","page_number":101,"box":{"x":68,"y":619,"width":825,"height":11}},{"id":"336cec76-cd55-47d0-86ef-e5b147e52f08","block_type":"box","text":"status of an unsecured creditor of the counterparty (","page_number":101,"box":{"x":69,"y":634,"width":374,"height":11}},{"id":"108fd76c-4105-4cf7-9720-cca59da91d76","block_type":"box","text":"i.e.","page_number":101,"box":{"x":445,"y":634,"width":20,"height":9}},{"id":"92e6cf67-0e0a-4a2f-ad6d-352659a83792","block_type":"box","text":", the position the Fund would normally be in if it were to hold,","page_number":101,"box":{"x":468,"y":634,"width":434,"height":11}},{"id":"160c6274-4e16-4260-97f7-478fc29e7011","block_type":"box","text":"pursuant to its investment policies, other unsecured debt securities of the defaulting counterparty) with respect to","page_number":101,"box":{"x":70,"y":649,"width":813,"height":12}},{"id":"7419a262-9112-41ff-aa90-7b6865207ecb","block_type":"box","text":"the amount of the shortfall. As an unsecured creditor, a Fund would be at risk of losing some or all of the principal","page_number":101,"box":{"x":68,"y":664,"width":816,"height":12}},{"id":"542b55aa-2240-49c7-b45c-4c434313431a","block_type":"box","text":"and income involved in the transaction.","page_number":101,"box":{"x":69,"y":680,"width":278,"height":9}},{"id":"5abde01b-d24c-4d95-84d0-a0aeac41874b","block_type":"box","text":"Regulations adopted by global prudential regulators require certain bank-regulated counterparties and certain of","page_number":101,"box":{"x":102,"y":702,"width":800,"height":12}},{"id":"b7e51bc7-0bb4-468b-a470-b74cc0cb7bf5","block_type":"box","text":"their affiliates to include in certain financial contracts, including many repurchase agreements and purchase and sale","page_number":101,"box":{"x":68,"y":717,"width":840,"height":12}},{"id":"c4573d17-b3a3-407f-bb5a-53d7b402b9d2","block_type":"box","text":"contracts, terms that delay or restrict the rights of counterparties, such as a Fund, to terminate such agreements,","page_number":101,"box":{"x":69,"y":732,"width":814,"height":12}},{"id":"a4081498-d8cd-47a7-a6f2-2da66515c7f0","block_type":"box","text":"take foreclosure action, exercise other default rights or restrict transfers of credit support in the event that the","page_number":101,"box":{"x":68,"y":748,"width":790,"height":11}},{"id":"7a1c7342-dcb7-46fd-8b8a-c43afc334bf0","block_type":"box","text":"counterparty and/or its affiliates are subject to certain types of resolution or insolvency proceedings. It is possible","page_number":101,"box":{"x":69,"y":763,"width":818,"height":11}},{"id":"e85dfa84-1f2d-4073-b9a9-7e7f7e405e34","block_type":"box","text":"that these requirements, as well as potential additional government regulation and other developments in the","page_number":101,"box":{"x":68,"y":778,"width":783,"height":11}},{"id":"f1822849-8376-4af3-a9a6-18f5b7532b15","block_type":"box","text":"market, could adversely affect a Fund’s ability to terminate existing repurchase agreements and purchase and sale","page_number":101,"box":{"x":69,"y":793,"width":821,"height":11}},{"id":"393c742f-ae28-444a-a066-a6c62914d6cc","block_type":"box","text":"contracts or to realize amounts to be received under such agreements. The SEC has also finalized rules that will","page_number":101,"box":{"x":69,"y":808,"width":800,"height":11}},{"id":"b434640b-7d49-44a1-a8c9-ae8daea2babb","block_type":"box","text":"require certain transactions involving U.S. Treasuries, including repurchase agreements, to be centrally cleared.","page_number":101,"box":{"x":69,"y":823,"width":796,"height":12}},{"id":"6583b021-bcc0-4f4d-a40a-b83729a602fc","block_type":"box","text":"Compliance with these rules is expected to be required by the middle of 2027. Although the impact of these rules on","page_number":101,"box":{"x":69,"y":838,"width":834,"height":12}},{"id":"774ecfa8-9d07-4ace-8ec2-ce736235e2f9","block_type":"box","text":"the Funds is difficult to predict, they may reduce the availability or increase the costs of such transactions and may","page_number":101,"box":{"x":68,"y":853,"width":824,"height":12}},{"id":"7817fa4d-4011-4dfa-af06-f42d195cebbe","block_type":"box","text":"adversely affect a Fund’s performance.","page_number":101,"box":{"x":69,"y":869,"width":279,"height":11}},{"id":"2b824263-d8a5-4e63-ac13-6459d0a0cb60","block_type":"box","text":"Restricted Securities.","page_number":101,"box":{"x":102,"y":891,"width":157,"height":9}},{"id":"ccba80b0-5a9c-4562-b082-19e67efd6fe5","block_type":"box","text":"A Fund may invest in or hold securities that are not registered under the Securities Act","page_number":101,"box":{"x":265,"y":891,"width":617,"height":12}},{"id":"5afdc3dc-9b73-4d88-81ac-2b53f08667e1","block_type":"box","text":"(“restricted securities”), which may include securities in private companies and Rule 144A Securities. Restricted","page_number":101,"box":{"x":69,"y":906,"width":801,"height":12}},{"id":"e73c771d-ec6c-4b3a-b542-10b4fd542641","block_type":"box","text":"II-70","page_number":101,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"dadaafc5-160a-48a7-974f-201428c95f96","block_type":"box","text":"NM0926U-5977317-101/232","page_number":101,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"8787705d-131e-4e4d-ac9c-5798051e7412","block_type":"box","text":"securities may be sold in private placement transactions between issuers and their purchasers, including through","page_number":102,"box":{"x":69,"y":45,"width":808,"height":11}},{"id":"1aaa6c47-8acb-4270-9073-78c635eb546e","block_type":"box","text":"private negotiated transactions between the issuer and their purchasers, such as the Funds, and may be neither","page_number":102,"box":{"x":70,"y":60,"width":802,"height":11}},{"id":"04d2059f-8b43-436a-b2a9-e9cb26cb5b42","block_type":"box","text":"listed on an exchange nor traded in other established markets. In many cases, privately placed securities may not be","page_number":102,"box":{"x":70,"y":75,"width":834,"height":11}},{"id":"dc0acb6e-dbb5-4f96-ac26-494a1a7700e3","block_type":"box","text":"freely transferable under the laws of the applicable jurisdiction or due to contractual restrictions on resale. Some of","page_number":102,"box":{"x":68,"y":90,"width":825,"height":11}},{"id":"2be1b599-81c6-4de2-8154-22acce43f47c","block_type":"box","text":"these securities are new and complex, and trade only among institutions; the markets for these securities are still","page_number":102,"box":{"x":68,"y":105,"width":815,"height":11}},{"id":"9c4bd939-e429-4882-b770-947f196556ff","block_type":"box","text":"developing, and may not function as efficiently as established markets. Typically, investments in private companies","page_number":102,"box":{"x":69,"y":120,"width":821,"height":12}},{"id":"750d7d64-99c7-4e6a-8e26-910b432cf8db","block_type":"box","text":"are in restricted securities that are not traded in public markets and subject to substantial holding periods, so that a","page_number":102,"box":{"x":69,"y":136,"width":831,"height":11}},{"id":"40aa281c-62b2-4e99-acd6-53326f966e78","block_type":"box","text":"Fund may not be able to resell some of its holdings for extended periods, which may be several years. There can be","page_number":102,"box":{"x":70,"y":150,"width":824,"height":12}},{"id":"5d0fa039-cb88-4fab-9635-d2eb394d72b5","block_type":"box","text":"no assurance that a Fund will be able to realize the value of such restricted securities in a timely manner or at all. As","page_number":102,"box":{"x":69,"y":166,"width":834,"height":11}},{"id":"b0959b7e-3a23-4778-8dfe-19ca8635df73","block_type":"box","text":"a result of the absence of a public trading market and the potential bespoke nature on certain transactions,","page_number":102,"box":{"x":69,"y":181,"width":769,"height":11}},{"id":"b65b6037-596c-4780-91f8-e13db04069ab","block_type":"box","text":"restricted securities may be deemed to be illiquid investments or less liquid investments and may be more difficult to","page_number":102,"box":{"x":69,"y":196,"width":838,"height":11}},{"id":"afff09f4-38d2-406c-a93f-0d9fe3934632","block_type":"box","text":"value than publicly traded securities. To the extent that restricted securities may be resold in privately negotiated","page_number":102,"box":{"x":68,"y":211,"width":805,"height":11}},{"id":"d0f8ebe4-e4b1-44bd-92c0-3fee41c85004","block_type":"box","text":"transactions, the prices realized from the sales, due to lack of liquidity, could be less than those originally paid by the","page_number":102,"box":{"x":68,"y":226,"width":840,"height":11}},{"id":"11bb4997-cd7f-4af9-8bee-52919b5d01ad","block_type":"box","text":"Fund or less than their fair market value. The amount of any discount may vary depending on the security type, the","page_number":102,"box":{"x":70,"y":241,"width":815,"height":11}},{"id":"c031f0dd-efde-42be-85e1-a1c166c97554","block_type":"box","text":"character of the issuer, which party (if any) will bear the expenses of registering the restricted security, and prevailing","page_number":102,"box":{"x":69,"y":256,"width":835,"height":12}},{"id":"4c350653-4dbd-47b7-8fc7-747aeed40ffa","block_type":"box","text":"market conditions. In addition, issuers whose securities are not publicly traded or who are not otherwise publicly","page_number":102,"box":{"x":69,"y":272,"width":803,"height":11}},{"id":"e7a04763-0b62-4420-a724-2ab44ed86e3f","block_type":"box","text":"listed may not be subject to the disclosure and other investor protection requirements that may be applicable if their","page_number":102,"box":{"x":70,"y":286,"width":830,"height":12}},{"id":"8fe801f3-4bbb-4db4-baae-093c8e20cf0c","block_type":"box","text":"securities were publicly traded. If any privately placed securities held by a Fund are required to be registered under","page_number":102,"box":{"x":69,"y":302,"width":817,"height":11}},{"id":"b767f06b-a30a-4a38-9656-f8e16d4180ee","block_type":"box","text":"the securities laws of one or more jurisdictions before being resold, the Fund may be required to bear the expenses","page_number":102,"box":{"x":68,"y":317,"width":825,"height":11}},{"id":"1bb062ce-7b9d-4a4b-a3c1-bc5af761e18c","block_type":"box","text":"of registration. Where registration is required for restricted securities, a considerable time period may elapse","page_number":102,"box":{"x":69,"y":332,"width":777,"height":11}},{"id":"d3a5b099-9e17-4fda-aa2b-956a07797892","block_type":"box","text":"between the time the Fund decides to sell the security and the time it is actually permitted to sell the security under","page_number":102,"box":{"x":69,"y":347,"width":828,"height":11}},{"id":"b1ccb273-7699-43dd-99a1-df00f442dfb5","block_type":"box","text":"an effective registration statement. If during such period, adverse market conditions were to develop, the Fund might","page_number":102,"box":{"x":69,"y":362,"width":834,"height":11}},{"id":"5023502b-ddc3-4f59-a577-e5cd6e8c610b","block_type":"box","text":"obtain less favorable pricing terms than when it decided to sell the security. In addition, the Fund may be deemed to","page_number":102,"box":{"x":69,"y":377,"width":828,"height":12}},{"id":"a594b5d4-9ca0-4627-908d-7091685f4e3a","block_type":"box","text":"be an “underwriter” for purposes of the Securities Act when selling restricted securities. If so, the Fund may be liable","page_number":102,"box":{"x":69,"y":392,"width":836,"height":12}},{"id":"3484425d-cae0-447f-ac1a-72b1581e549c","block_type":"box","text":"to purchasers of the restricted securities if the registration statement prepared by the issuer, or the corresponding","page_number":102,"box":{"x":68,"y":407,"width":819,"height":12}},{"id":"ecc540b3-a0d9-4dfd-83af-ac3c940f50b0","block_type":"box","text":"prospectus, is materially inaccurate or misleading. Transactions in restricted securities may entail other transaction","page_number":102,"box":{"x":70,"y":423,"width":822,"height":11}},{"id":"4affbfe2-cf02-4f81-b77c-d90917e0700e","block_type":"box","text":"costs that are higher than those for transactions in unrestricted securities. Certain of the Fund’s investments in","page_number":102,"box":{"x":69,"y":438,"width":798,"height":11}},{"id":"90403bdb-e244-416d-b298-30f843e8e7e7","block_type":"box","text":"private placements may consist of direct investments and may include investments in smaller, less seasoned","page_number":102,"box":{"x":70,"y":453,"width":780,"height":11}},{"id":"4e20a02d-10b2-476f-9e7a-d8d5a795264f","block_type":"box","text":"issuers, which may involve greater risks. Issuers of restricted securities may not be subject to SEC reporting","page_number":102,"box":{"x":70,"y":468,"width":773,"height":11}},{"id":"d89449eb-f533-497c-968d-ba2a8ac69606","block_type":"box","text":"requirements, may not be required to maintain their accounting records in accordance with generally accepted","page_number":102,"box":{"x":69,"y":483,"width":784,"height":11}},{"id":"ef04b0a2-7ce5-46ae-93e7-7c4fdfbe9acd","block_type":"box","text":"accounting principles, and may not be required to maintain effective internal controls over financial reporting. As a","page_number":102,"box":{"x":69,"y":498,"width":816,"height":11}},{"id":"4f708fd2-b2a3-47b3-b1f0-9f13603261b0","block_type":"box","text":"result, BlackRock may not have timely or accurate information about the business, financial condition and results of","page_number":102,"box":{"x":69,"y":513,"width":828,"height":11}},{"id":"d9890ad7-4edf-4dea-a87a-6280ffa75c32","block_type":"box","text":"operations of such issuers, and investments in securities of such issuers may involve a high degree of business and","page_number":102,"box":{"x":69,"y":528,"width":831,"height":12}},{"id":"8bb9455e-2aa0-4e89-8bce-436946295983","block_type":"box","text":"financial risk and may result in substantial losses to the Fund. Such issuers may also have limited product lines,","page_number":102,"box":{"x":68,"y":543,"width":804,"height":12}},{"id":"cabf2cc7-7dcb-457e-b603-05144861b4ee","block_type":"box","text":"markets or financial resources, or they may be dependent on a limited management group.","page_number":102,"box":{"x":69,"y":559,"width":647,"height":11}},{"id":"429ee6cd-39f9-4ab0-a872-493c6ba90b9d","block_type":"box","text":"Certain restricted securities may represent limited investment opportunities and each shareholder’s","page_number":102,"box":{"x":102,"y":581,"width":714,"height":11}},{"id":"81b1b2a3-41c5-40bd-ad26-baab87e571e3","block_type":"box","text":"proportionate investment exposure to such limited investment opportunities may be reduced proportionately as the","page_number":102,"box":{"x":70,"y":597,"width":823,"height":11}},{"id":"5b6ecd00-0778-4cde-aa00-eb3ea23f0837","block_type":"box","text":"Fund’s net assets grow from new or additional investments made in the Fund by other shareholders. The issuer of a","page_number":102,"box":{"x":70,"y":612,"width":826,"height":11}},{"id":"ba28cd07-ee42-4dac-9f9b-5def369ad14b","block_type":"box","text":"private placement may later register those shares for public sale in an IPO, but there is no guarantee that an IPO will","page_number":102,"box":{"x":70,"y":627,"width":830,"height":11}},{"id":"117b589b-3809-4e29-b00e-00f02c99ddc7","block_type":"box","text":"ever be completed. Even after an IPO, there may be a limited trading market for securities of that issuer, including","page_number":102,"box":{"x":69,"y":642,"width":812,"height":11}},{"id":"157e2c69-2a64-4aff-a81c-8eac20950e79","block_type":"box","text":"any direct investment by a Fund, or the Fund may be subject to contractual limitations on its ability to resell its","page_number":102,"box":{"x":69,"y":657,"width":787,"height":11}},{"id":"f0ca90f1-787d-4363-af3c-f3ec305af649","block_type":"box","text":"existing securities following an IPO. The inability of an applicable issuer of a restricted security to complete an IPO or","page_number":102,"box":{"x":69,"y":672,"width":833,"height":11}},{"id":"96e6234f-b089-4efa-8f2a-e82874c906a4","block_type":"box","text":"offer other liquidity opportunities to the Fund and other investors will extend the holding period of a Fund’s","page_number":102,"box":{"x":69,"y":687,"width":759,"height":11}},{"id":"dccdcae7-fc99-43ac-8416-9adbc437f28c","block_type":"box","text":"investments, potentially indefinitely, and may adversely affect the value of the investments. In making investments in","page_number":102,"box":{"x":70,"y":702,"width":833,"height":12}},{"id":"911dc413-e691-4753-83b6-ba7bf110bb5c","block_type":"box","text":"such securities, a Fund may obtain access to material nonpublic information, which may restrict the Fund’s ability to","page_number":102,"box":{"x":69,"y":717,"width":828,"height":12}},{"id":"cf93a5ed-0424-4621-a40a-0cc33895379e","block_type":"box","text":"conduct portfolio transactions in such securities. The activity of identifying, completing, and realizing upon attractive","page_number":102,"box":{"x":69,"y":732,"width":827,"height":12}},{"id":"c82a28ca-b7c8-4ee5-ac2f-46a2cb827478","block_type":"box","text":"investments in restricted securities is highly competitive and involves a high degree of uncertainty. A Fund will be","page_number":102,"box":{"x":70,"y":748,"width":804,"height":11}},{"id":"7c4c9468-e4af-44af-bd30-545ed0d770cf","block_type":"box","text":"competing for investments against other similarly situated investors. It is possible that competition for appropriate","page_number":102,"box":{"x":69,"y":763,"width":816,"height":11}},{"id":"f00fd883-e697-4226-a410-5f09a9e9cc79","block_type":"box","text":"investment opportunities may increase, thus potentially reducing the number of investment opportunities available to","page_number":102,"box":{"x":70,"y":778,"width":835,"height":11}},{"id":"9732d189-d2f7-4223-8ae8-5bedc1811a7d","block_type":"box","text":"a Fund and adversely affecting the terms upon which investments can be made. There is no assurance that","page_number":102,"box":{"x":69,"y":793,"width":768,"height":11}},{"id":"804446ea-ede6-405f-a378-86116c60de49","block_type":"box","text":"investment opportunities for restricted securities will be available at any given time or at a level desired by a Fund,","page_number":102,"box":{"x":70,"y":808,"width":815,"height":11}},{"id":"7fdeea0d-c233-464f-8ec8-bc779531d2de","block_type":"box","text":"especially as that Fund grows in size.","page_number":102,"box":{"x":69,"y":823,"width":264,"height":12}},{"id":"3b8fa18c-af78-468c-8309-8ce9cdc08850","block_type":"box","text":"There may not be a readily available market value for a Fund’s restricted securities (in particular, restricted","page_number":102,"box":{"x":101,"y":846,"width":762,"height":11}},{"id":"8f62c2fb-b134-4a78-aaaf-956883ff3bda","block_type":"box","text":"securities issued by private companies) and thus they may be considered “illiquid”. Each Fund values restricted","page_number":102,"box":{"x":69,"y":861,"width":795,"height":11}},{"id":"f87f2185-c88f-40cb-a779-af5d1d2c7238","block_type":"box","text":"securities in accordance with BlackRock’s valuation policies and procedures, which are designed to value","page_number":102,"box":{"x":69,"y":876,"width":751,"height":11}},{"id":"4e5a223c-7e56-475e-8554-8ecd73c63d56","block_type":"box","text":"investments such that they accurately reflect fair value. Due to the inherent uncertainty and subjectivity of","page_number":102,"box":{"x":70,"y":891,"width":755,"height":11}},{"id":"2fd28051-cb95-4378-906e-72b07c6e5b93","block_type":"box","text":"determining the fair value of investments that do not have a readily available market value, the fair value of a Fund’s","page_number":102,"box":{"x":69,"y":906,"width":830,"height":12}},{"id":"8cb3629a-2e8a-45ad-afd8-294ef9b4b1c9","block_type":"box","text":"II-71","page_number":102,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"77ecd07d-c4ff-4a86-b756-0bb0c7d9ec0c","block_type":"box","text":"NM0926U-5977317-102/232","page_number":102,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"13644785-21f1-46dd-b626-c493d380abd6","block_type":"box","text":"private investments may differ significantly from the values that would have been used had a readily available market","page_number":103,"box":{"x":70,"y":45,"width":835,"height":11}},{"id":"26bce42b-33eb-4293-8273-9014219858f7","block_type":"box","text":"value existed for such investments and may differ materially from the amounts the Fund may realize on any","page_number":103,"box":{"x":68,"y":60,"width":766,"height":11}},{"id":"0f10da0c-ec04-4190-8dd4-56a8b7c045b6","block_type":"box","text":"dispositions of such investments. Differences in the value of the Fund’s private investments could result in the","page_number":103,"box":{"x":69,"y":75,"width":792,"height":11}},{"id":"4452dcc1-edc1-4720-8968-fe206af66233","block_type":"box","text":"Fund’s shareholder transactions being effected at a NAV that does not accurately reflect the underlying value of the","page_number":103,"box":{"x":70,"y":90,"width":821,"height":11}},{"id":"a10503ea-afdf-43ae-8f75-c6dc713a14c7","block_type":"box","text":"Fund’s portfolio, potentially resulting in the dilution of shareholder interests and increasing opportunities for","page_number":103,"box":{"x":70,"y":105,"width":771,"height":11}},{"id":"c7297886-2a08-41d0-ae7e-510132365e0c","block_type":"box","text":"shareholder arbitrage. The values used by the Fund to price its restricted securities may also differ from those used","page_number":103,"box":{"x":69,"y":120,"width":826,"height":12}},{"id":"abfd7bc7-4236-4b8a-af64-6eadbf7b4140","block_type":"box","text":"by other investment companies and investors to price the same restricted securities. In addition, the impact of","page_number":103,"box":{"x":69,"y":135,"width":790,"height":11}},{"id":"e02b899e-ba98-41da-b302-4b44659dba01","block_type":"box","text":"changes in the market environment and other events on the fair values of a Fund’s investments that have no readily","page_number":103,"box":{"x":69,"y":150,"width":828,"height":12}},{"id":"654d0ed2-7156-4514-a38a-9fde6d67ae4e","block_type":"box","text":"available market values may differ from the impact of such changes on the readily available market values for the","page_number":103,"box":{"x":69,"y":166,"width":810,"height":11}},{"id":"a95b6d9f-f177-4216-b24a-3fc9c0351d21","block_type":"box","text":"Fund’s other investments. A Fund’s NAV could be adversely affected if the Fund’s determinations regarding the fair","page_number":103,"box":{"x":70,"y":181,"width":818,"height":11}},{"id":"745ec0e7-35fa-410b-9e77-6181ec2ab131","block_type":"box","text":"value of the Fund’s investments were materially higher than the investment’s actual market or fair value or the values","page_number":103,"box":{"x":68,"y":196,"width":839,"height":11}},{"id":"08c9bf97-3592-44f4-bead-ab7a394e2f35","block_type":"box","text":"that the Fund ultimately realizes upon the disposal of such investments.","page_number":103,"box":{"x":68,"y":211,"width":514,"height":11}},{"id":"dc42ac52-e5d5-4d94-8212-96e4085effbb","block_type":"box","text":"See also risks discussed under “Illiquid Investments.”","page_number":103,"box":{"x":102,"y":234,"width":385,"height":11}},{"id":"2f42b1ad-b314-458f-8d81-230956ba7a3a","block_type":"box","text":"Reverse Repurchase Agreements.","page_number":103,"box":{"x":102,"y":257,"width":246,"height":10}},{"id":"a162f812-6f80-42ae-8491-2e5559f770ed","block_type":"box","text":"A Fund may enter into reverse repurchase agreements with the same parties","page_number":103,"box":{"x":354,"y":257,"width":548,"height":11}},{"id":"f83c1433-a5b2-4e74-abc3-5507f1bc5744","block_type":"box","text":"with whom it may enter into repurchase agreements. Under a reverse repurchase agreement, a Fund sells securities","page_number":103,"box":{"x":68,"y":272,"width":830,"height":11}},{"id":"32ebb44f-8448-4af5-8762-77fba9782bd5","block_type":"box","text":"to another party and agrees to repurchase them at a particular date and price. A Fund may enter into a reverse","page_number":103,"box":{"x":68,"y":287,"width":793,"height":11}},{"id":"6df14b8d-1295-4f82-94ab-b67d394a8e5a","block_type":"box","text":"repurchase agreement when it is anticipated that the interest income to be earned from the investment of the","page_number":103,"box":{"x":69,"y":302,"width":784,"height":11}},{"id":"ddceb244-169a-4260-ae2f-3ab571b9bb8c","block_type":"box","text":"proceeds of the transaction is greater than the interest expense of the transaction.","page_number":103,"box":{"x":70,"y":317,"width":591,"height":11}},{"id":"b56753f8-4780-49e0-9495-8bbeb921daa2","block_type":"box","text":"The use of reverse repurchase agreements may be regarded as leveraging and, therefore, speculative.","page_number":103,"box":{"x":101,"y":339,"width":730,"height":12}},{"id":"8753f82d-3de0-4972-825a-aa609ee0fe7f","block_type":"box","text":"Furthermore, reverse repurchase agreements involve the risks that (i) the interest income earned in the investment","page_number":103,"box":{"x":70,"y":355,"width":822,"height":11}},{"id":"6d45bbb6-3ee8-420a-b0fe-e707b57788db","block_type":"box","text":"of the proceeds will be less than the interest expense, (ii) the market value of the securities retained in lieu of sale","page_number":103,"box":{"x":69,"y":370,"width":821,"height":11}},{"id":"342955be-81b9-4875-be9e-7f5b7ef1eb06","block_type":"box","text":"by a Fund may decline below the price of the securities the Fund has sold but is obligated to repurchase, (iii) the","page_number":103,"box":{"x":69,"y":385,"width":801,"height":11}},{"id":"b3b84a04-a640-40bb-8d90-c4b47d271f36","block_type":"box","text":"market value of the securities sold will decline below the price at which the Fund is required to repurchase them and","page_number":103,"box":{"x":69,"y":400,"width":830,"height":11}},{"id":"54297215-e8fd-461f-8a75-efe697ab883a","block_type":"box","text":"(iv) the securities will not be returned to the Fund.","page_number":103,"box":{"x":69,"y":415,"width":354,"height":11}},{"id":"4e788888-f8e1-4a7a-b692-2c271158045b","block_type":"box","text":"In addition, if the buyer of securities under a reverse repurchase agreement files for bankruptcy or becomes","page_number":103,"box":{"x":102,"y":438,"width":769,"height":11}},{"id":"17c7599a-2b50-4890-ae46-0d6abc0a8374","block_type":"box","text":"insolvent, such buyer or its trustee or receiver may receive an extension of time to determine whether to enforce a","page_number":103,"box":{"x":70,"y":453,"width":815,"height":11}},{"id":"cb2988a0-b533-4d11-8d93-60a22556f1da","block_type":"box","text":"Fund’s obligations to repurchase the securities and the Fund’s use of the proceeds of the reverse repurchase","page_number":103,"box":{"x":70,"y":468,"width":782,"height":11}},{"id":"199e3f4d-d87d-481d-9802-66e4511555bc","block_type":"box","text":"agreement may effectively be restricted pending such decision.","page_number":103,"box":{"x":69,"y":483,"width":449,"height":11}},{"id":"97db1013-a6a7-4879-a6d8-135c15d85d62","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into reverse repurchase agreements and","page_number":103,"box":{"x":102,"y":506,"width":794,"height":11}},{"id":"552cabfe-bf8c-4674-b20d-26e88d197c7b","block_type":"box","text":"similar financing transactions (","page_number":103,"box":{"x":69,"y":521,"width":218,"height":11}},{"id":"4515f893-ad48-4c53-97e4-93e0923823bc","block_type":"box","text":"e.g.","page_number":103,"box":{"x":289,"y":522,"width":24,"height":10}},{"id":"ef8fcb70-a237-4712-b6f3-d8bc14722b54","block_type":"box","text":", recourse and non-recourse tender option bonds, borrowed bonds) notwithstanding","page_number":103,"box":{"x":316,"y":521,"width":594,"height":11}},{"id":"3361fdf3-3b4f-40dc-ab67-1561a1a69d2a","block_type":"box","text":"the limitation on the issuance of senior securities in Section 18 of the Investment Company Act, provided that the","page_number":103,"box":{"x":68,"y":536,"width":813,"height":11}},{"id":"febb29fd-2019-4568-98f2-6fcffe5e7105","block_type":"box","text":"Fund either (i) complies with the 300% asset coverage ratio with respect to all such transactions and any other","page_number":103,"box":{"x":70,"y":551,"width":789,"height":11}},{"id":"52c3cd68-69a9-45b0-98e1-8def60fef792","block_type":"box","text":"borrowings in the aggregate, or (ii) treats all such transactions as Derivatives Transactions under Rule 18f-4. See “—","page_number":103,"box":{"x":69,"y":566,"width":836,"height":11}},{"id":"31bea1d1-8302-423f-8c6d-e0d2b2ece182","block_type":"box","text":"Derivatives — Regulation of Derivatives — Rule 18f-4 under the Investment Company Act” above. The SEC has also","page_number":103,"box":{"x":70,"y":581,"width":824,"height":12}},{"id":"8a5482ef-cd82-415c-842b-ce496395d3e6","block_type":"box","text":"finalized rules that will require certain transactions involving U.S. Treasuries, including reverse repurchase","page_number":103,"box":{"x":68,"y":596,"width":758,"height":12}},{"id":"83802f9d-dd6c-471f-a4af-5c9d03ad73ff","block_type":"box","text":"agreements, to be centrally cleared. Compliance with these rules is expected to be required by the middle of 2027.","page_number":103,"box":{"x":69,"y":612,"width":822,"height":11}},{"id":"f303a625-1b38-45b3-b02c-5f945f02bb1a","block_type":"box","text":"Although the impact of these rules on the Funds is difficult to predict, they may reduce the availability or increase the","page_number":103,"box":{"x":68,"y":627,"width":838,"height":11}},{"id":"a56230dc-bf04-4325-8b59-ca348fc5bfb4","block_type":"box","text":"costs of such transactions and may adversely affect a Fund’s performance.","page_number":103,"box":{"x":69,"y":642,"width":538,"height":11}},{"id":"f66c45ad-3d87-422c-98bc-35c5bffe4295","block_type":"box","text":"Additionally, regulations adopted by global prudential regulators require certain bank-regulated counterparties","page_number":103,"box":{"x":101,"y":665,"width":780,"height":11}},{"id":"e7a715af-da9a-4122-963b-8438b0375d31","block_type":"box","text":"and certain of their affiliates to include in certain financial contracts, including many reverse repurchase agreements,","page_number":103,"box":{"x":69,"y":680,"width":838,"height":11}},{"id":"3f93b35a-6498-4687-a60c-be84a5382de8","block_type":"box","text":"terms that delay or restrict the rights of counterparties, such as a Fund, to terminate such agreements, take","page_number":103,"box":{"x":68,"y":695,"width":775,"height":11}},{"id":"8ba51799-2dc6-4200-9f62-a6c111acdfeb","block_type":"box","text":"foreclosure action, exercise other default rights or restrict transfers of credit support in the event that the","page_number":103,"box":{"x":68,"y":710,"width":754,"height":11}},{"id":"649500e3-7b97-4049-818f-ec760c90c379","block_type":"box","text":"counterparty and/or its affiliates are subject to certain types of resolution or insolvency proceedings. It is possible","page_number":103,"box":{"x":69,"y":725,"width":818,"height":11}},{"id":"baca77b8-d7fa-4bca-b03d-31585d4e7d81","block_type":"box","text":"that these requirements, as well as potential additional government regulation and other developments in the","page_number":103,"box":{"x":68,"y":740,"width":783,"height":11}},{"id":"537ad443-5a39-4e12-a81d-85696f5a3a3a","block_type":"box","text":"market, could adversely affect a Fund’s ability to terminate existing reverse repurchase agreements or to realize","page_number":103,"box":{"x":69,"y":755,"width":800,"height":11}},{"id":"a5b59e5b-0270-4dca-95c5-6afb45aba82a","block_type":"box","text":"amounts to be received under such agreements.","page_number":103,"box":{"x":69,"y":771,"width":345,"height":11}},{"id":"250fc500-3853-4a8c-bd27-ea1b6b298a10","block_type":"box","text":"Rights Offerings and Warrants to Purchase.","page_number":103,"box":{"x":102,"y":793,"width":316,"height":11}},{"id":"8634fdc6-cb33-43bc-bc58-0d6b4b61858e","block_type":"box","text":"Certain Funds may participate in rights offerings and may purchase","page_number":103,"box":{"x":424,"y":793,"width":481,"height":11}},{"id":"d4c60c32-4adc-4fa7-82b8-97f7c074d77d","block_type":"box","text":"warrants, which are privileges issued by corporations enabling the owners to subscribe to and purchase a specified","page_number":103,"box":{"x":68,"y":808,"width":822,"height":11}},{"id":"a2ebd3a8-f305-4fe2-b864-d71b2f993909","block_type":"box","text":"number of shares of the corporation at a specified price during a specified period of time. Subscription rights","page_number":103,"box":{"x":69,"y":823,"width":776,"height":12}},{"id":"1b1360cd-6da8-4acc-80c0-0cb013396e21","block_type":"box","text":"normally have a short life span to expiration. The purchase of rights or warrants involves the risk that a Fund could","page_number":103,"box":{"x":69,"y":838,"width":817,"height":12}},{"id":"bb0e2f65-06dd-4c05-bde6-726ca65c54d0","block_type":"box","text":"lose the purchase value of a right or warrant if the right to subscribe to additional shares is not exercised prior to the","page_number":103,"box":{"x":70,"y":853,"width":833,"height":12}},{"id":"4bece3d8-da08-416b-b415-f84caccd3251","block_type":"box","text":"rights’ and warrants’ expiration. Also, the purchase of rights and/or warrants involves the risk that the effective price","page_number":103,"box":{"x":69,"y":869,"width":835,"height":11}},{"id":"33c44cf3-5ca3-4259-b2b6-def623e5e7dd","block_type":"box","text":"paid for the right and/or warrant added to the subscription price of the related security may exceed the value of the","page_number":103,"box":{"x":70,"y":884,"width":821,"height":11}},{"id":"5ce6f7dd-adfc-4c72-bcab-450107c215a3","block_type":"box","text":"subscribed security’s market price such as when there is no movement in the level of the underlying security. Buying","page_number":103,"box":{"x":69,"y":899,"width":830,"height":11}},{"id":"dd366817-4127-4761-b80f-d4fb58557093","block_type":"box","text":"II-72","page_number":103,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"6398d464-9df2-4ffa-b6f8-ee81e9a13fc0","block_type":"box","text":"NM0926U-5977317-103/232","page_number":103,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"3ad5be37-fde7-49a5-a64a-03daa0971267","block_type":"box","text":"a warrant does not make the Fund a shareholder of the underlying stock. The warrant holder has no voting or","page_number":104,"box":{"x":69,"y":45,"width":777,"height":11}},{"id":"845a0c0a-2b79-4516-9d47-909d439c70f5","block_type":"box","text":"dividend rights with respect to the underlying stock. A warrant does not carry any right to assets of the issuer, and for","page_number":104,"box":{"x":69,"y":60,"width":839,"height":11}},{"id":"0a4b3dd3-b915-4cba-b700-c53a91d26c2a","block_type":"box","text":"this reason investments in warrants may be more speculative than other equity-based investments.","page_number":104,"box":{"x":68,"y":75,"width":708,"height":11}},{"id":"f30ec4b5-7dab-4a92-9acd-09a7804e84dd","block_type":"box","text":"Rule 144A Securities.","page_number":104,"box":{"x":102,"y":98,"width":159,"height":9}},{"id":"7666d6aa-b51a-4e99-a038-9a20a2a7cd71","block_type":"box","text":"A Fund may purchase securities that can be offered and sold only to “qualified","page_number":104,"box":{"x":266,"y":98,"width":560,"height":11}},{"id":"5b1377fe-cb0a-4909-ad4e-75dd12b03cdc","block_type":"box","text":"institutional buyers” pursuant to Rule 144A under the Securities Act. See “Restricted Securities” above.","page_number":104,"box":{"x":70,"y":113,"width":741,"height":11}},{"id":"746f3d99-4ed5-41d8-9d3a-a214362ed59e","block_type":"box","text":"Securities Lending.","page_number":104,"box":{"x":101,"y":135,"width":139,"height":11}},{"id":"de26271a-534b-4261-9eca-99ecb519886a","block_type":"box","text":"Each Fund may lend portfolio securities to certain borrowers that BlackRock determines to","page_number":104,"box":{"x":247,"y":135,"width":645,"height":11}},{"id":"7bd621b5-9fcd-4a8f-bfad-44fdf6279165","block_type":"box","text":"be creditworthy, including borrowers affiliated with BlackRock. The borrowers provide collateral that is maintained in","page_number":104,"box":{"x":69,"y":150,"width":825,"height":12}},{"id":"004a3beb-5efa-48b3-a7e6-b8f0605c0f17","block_type":"box","text":"an amount at least equal to the current market value of the securities loaned. No securities loan shall be made on","page_number":104,"box":{"x":69,"y":166,"width":817,"height":11}},{"id":"0e1cb637-80c3-439f-a089-5524d7892115","block_type":"box","text":"behalf of a Fund if, as a result, the aggregate value of all securities loans of the particular Fund exceeds one-third of","page_number":104,"box":{"x":69,"y":181,"width":831,"height":11}},{"id":"fec7ffbc-774a-458e-8a79-b8120d85ec61","block_type":"box","text":"the value of such Fund’s total assets (including the value of the collateral received). A Fund may terminate a loan at","page_number":104,"box":{"x":68,"y":196,"width":827,"height":11}},{"id":"11905bb5-5d1d-4e9d-b2a9-eb09894ad86f","block_type":"box","text":"any time and obtain the return of the securities loaned. Each Fund receives, by way of substitute payment, the value","page_number":104,"box":{"x":69,"y":211,"width":829,"height":11}},{"id":"26210d0d-b160-41ed-8e4e-12322417517f","block_type":"box","text":"of any interest or cash or non-cash distributions paid on the loaned securities that it would have otherwise received if","page_number":104,"box":{"x":69,"y":226,"width":838,"height":11}},{"id":"889ac54c-b67d-4c46-8690-a537f19d7ab7","block_type":"box","text":"the securities were not on loan.","page_number":104,"box":{"x":68,"y":241,"width":225,"height":9}},{"id":"58c0c08c-cdf7-4b3c-8fbe-92691a518f8b","block_type":"box","text":"With respect to loans that are collateralized by cash, the borrower may be entitled to receive a fee based on the","page_number":104,"box":{"x":101,"y":264,"width":799,"height":11}},{"id":"8bfcaa03-b416-4df1-add5-8deecc20fd76","block_type":"box","text":"amount of cash collateral. The Funds are compensated by any positive difference between the amount earned on the","page_number":104,"box":{"x":69,"y":279,"width":835,"height":11}},{"id":"5d873817-d3ec-4245-a025-7760b516948e","block_type":"box","text":"reinvestment of cash collateral and the fee paid to the borrower. In the case of collateral other than cash, a Fund is","page_number":104,"box":{"x":69,"y":294,"width":824,"height":11}},{"id":"94a35689-a422-49e3-a307-8058cb57bc2b","block_type":"box","text":"compensated by a fee paid by the borrower equal to a percentage of the market value of the loaned securities. Any","page_number":104,"box":{"x":69,"y":309,"width":821,"height":11}},{"id":"45f427b7-a104-4b61-837c-f67631586af3","block_type":"box","text":"cash collateral received by the Fund for such loans, and uninvested cash, may be reinvested in certain short-term","page_number":104,"box":{"x":69,"y":324,"width":810,"height":11}},{"id":"c9999f39-4c76-4954-a472-9d1ff7f79461","block_type":"box","text":"instruments either directly on behalf of the Fund or through one or more joint accounts or money market funds,","page_number":104,"box":{"x":70,"y":339,"width":789,"height":12}},{"id":"9c3f766f-b056-4783-91be-f64cafe6413b","block_type":"box","text":"including those affiliated with BlackRock; such investments are subject to investment risk.","page_number":104,"box":{"x":70,"y":355,"width":643,"height":11}},{"id":"f9a2dfaa-304b-4f87-bfab-e8449d19a895","block_type":"box","text":"Securities lending involves exposure to certain risks, including operational risk (","page_number":104,"box":{"x":102,"y":377,"width":568,"height":12}},{"id":"7b71316e-e36a-40e1-b368-66004626661d","block_type":"box","text":"i.e.","page_number":104,"box":{"x":672,"y":377,"width":20,"height":9}},{"id":"5a3fc4b1-93ee-45f9-8281-9dbd8c358f1b","block_type":"box","text":", the risk of losses resulting","page_number":104,"box":{"x":695,"y":377,"width":198,"height":12}},{"id":"11be1498-8507-4100-a76a-5b4225595b11","block_type":"box","text":"from problems in the settlement and accounting process), “gap” risk (","page_number":104,"box":{"x":68,"y":392,"width":501,"height":12}},{"id":"816f896b-6269-4617-bbab-c8f57ab40e65","block_type":"box","text":"i.e.","page_number":104,"box":{"x":571,"y":393,"width":20,"height":8}},{"id":"bfb534c4-9952-4a37-b088-6ee475f7cf82","block_type":"box","text":", the risk of a mismatch between the return","page_number":104,"box":{"x":594,"y":392,"width":307,"height":11}},{"id":"5e8308af-0d00-44b5-a3b6-f56f84a13c2c","block_type":"box","text":"on cash collateral reinvestments and the fees each Fund has agreed to pay a borrower), foreign exchange risk (","page_number":104,"box":{"x":69,"y":407,"width":794,"height":12}},{"id":"8d58241e-6c65-471b-884e-5cfd43ef6b5c","block_type":"box","text":"i.e.","page_number":104,"box":{"x":865,"y":408,"width":20,"height":8}},{"id":"34d46cf4-956c-4572-8960-93d157bc8709","block_type":"box","text":",","page_number":104,"box":{"x":888,"y":415,"width":2,"height":3}},{"id":"ec085051-b6ed-4152-90b0-fd66d6930b74","block_type":"box","text":"the risk of a shortfall at default when a cash collateral investment is denominated in a currency other than the","page_number":104,"box":{"x":68,"y":423,"width":788,"height":11}},{"id":"c9b2e833-03e6-43cc-8610-e0b640bb9a23","block_type":"box","text":"currency of the assets being loaned due to movements in foreign exchange rates), and credit, legal, counterparty and","page_number":104,"box":{"x":69,"y":438,"width":837,"height":11}},{"id":"6e68a319-6bb1-4b5c-bd69-f791e24eff14","block_type":"box","text":"market risks (including the risk that market events, including but not limited to corporate actions, could lead a Fund","page_number":104,"box":{"x":69,"y":453,"width":822,"height":11}},{"id":"343c4ee7-ec67-4611-a6f0-87b41dea42eb","block_type":"box","text":"to lend securities that are trading at a premium due to increased demand, or to recall loaned securities or to lend","page_number":104,"box":{"x":68,"y":468,"width":811,"height":11}},{"id":"d82ea3fb-be05-455b-b444-6221d2242111","block_type":"box","text":"less or not at all, which could lead to reduced securities lending revenue). If a Fund were to lend out securities that","page_number":104,"box":{"x":70,"y":483,"width":820,"height":11}},{"id":"a4d92353-77b4-4a2f-8b12-dbd57d525645","block_type":"box","text":"are subject to a corporate action and commit to the borrower a particular election as determined by the Fund’s","page_number":104,"box":{"x":69,"y":498,"width":790,"height":11}},{"id":"7736dc02-deaa-4ead-a687-49c51b4efeff","block_type":"box","text":"investment adviser, the benefit the Fund would receive in respect of committing to such election may or may not be","page_number":104,"box":{"x":70,"y":513,"width":820,"height":12}},{"id":"db9dce10-02a7-4701-8f05-59580847ae9a","block_type":"box","text":"less than the benefit the Fund would have received from making a different election in such corporate action. If a","page_number":104,"box":{"x":70,"y":528,"width":805,"height":12}},{"id":"064fb6af-3063-4a7b-aabd-030c9587af95","block_type":"box","text":"securities lending counterparty were to default, a Fund would be subject to the risk of a possible delay in receiving","page_number":104,"box":{"x":69,"y":543,"width":816,"height":12}},{"id":"3c1cef7b-d7e0-4fe8-be22-656b68c4c05d","block_type":"box","text":"collateral or in recovering the loaned securities, or to a possible loss of rights in the collateral. In the event a","page_number":104,"box":{"x":69,"y":559,"width":775,"height":11}},{"id":"eaaa6b73-be9b-410c-8752-03786ca054f7","block_type":"box","text":"borrower does not return a Fund’s securities as agreed, the Fund’s ability to participate in a corporate action event","page_number":104,"box":{"x":69,"y":574,"width":821,"height":11}},{"id":"5a99d9a3-7c66-461f-947b-f82c85cfb180","block_type":"box","text":"may be impacted, or the Fund may experience losses if the proceeds received from liquidating the collateral do not at","page_number":104,"box":{"x":69,"y":589,"width":838,"height":11}},{"id":"838cbc01-61e2-4c13-96a9-6fe0c0240e51","block_type":"box","text":"least equal the value of the loaned security at the time the collateral is liquidated, plus the transaction costs incurred","page_number":104,"box":{"x":70,"y":604,"width":837,"height":11}},{"id":"6df5ec00-3917-4ecc-b23a-1590e6b22ece","block_type":"box","text":"in purchasing replacement securities. This latter event could trigger adverse tax consequences for a Fund. A Fund","page_number":104,"box":{"x":70,"y":619,"width":808,"height":11}},{"id":"d5b4aef5-a514-44f2-88d5-29e2a66fdced","block_type":"box","text":"could lose money if its short-term investment of the collateral declines in value over the period of the loan. Substitute","page_number":104,"box":{"x":69,"y":634,"width":839,"height":11}},{"id":"bdcba869-89b2-49b4-8126-c8cfadf118f1","block_type":"box","text":"payments received by a Fund representing dividends paid on securities loaned out by the Fund will not be considered","page_number":104,"box":{"x":70,"y":650,"width":832,"height":11}},{"id":"51af9e5d-359d-4627-ae61-59466d68e617","block_type":"box","text":"qualified dividend income, and distributions by the Fund of such substitute payments will not constitute qualified","page_number":104,"box":{"x":69,"y":664,"width":801,"height":12}},{"id":"e6a98b50-fd09-442f-93cd-4ca890594b86","block_type":"box","text":"dividend income. Additionally, substitute payments received by a Fund representing qualified REIT dividends paid on","page_number":104,"box":{"x":69,"y":680,"width":823,"height":11}},{"id":"13dae509-0378-4997-9fae-b102ac2cf3c5","block_type":"box","text":"REIT securities loaned out by the Fund will not be considered qualified REIT dividends, and distributions by the Fund","page_number":104,"box":{"x":70,"y":695,"width":823,"height":11}},{"id":"94b8e1ad-ab1c-46e7-9752-f15fca89b014","block_type":"box","text":"of such substitute payments will not be eligible for a 20% deduction currently available for ordinary REIT dividends","page_number":104,"box":{"x":69,"y":710,"width":812,"height":11}},{"id":"210c8a14-7ed1-49f0-85e6-8a774c1f44d9","block_type":"box","text":"paid to non-corporate shareholders provided certain other requirements are satisfied. The securities lending agent","page_number":104,"box":{"x":70,"y":725,"width":814,"height":11}},{"id":"0ea3dbf0-716b-419b-8af1-259c38cce591","block_type":"box","text":"will take into account the tax effects on shareholders caused by these differences in connection with a Fund’s","page_number":104,"box":{"x":68,"y":740,"width":787,"height":11}},{"id":"353e58c7-d092-4609-bcba-ec2596820663","block_type":"box","text":"securities lending program. Substitute payments received on tax-exempt securities loaned out will not be tax-exempt","page_number":104,"box":{"x":69,"y":755,"width":828,"height":11}},{"id":"e87b99a7-0c90-4d64-9767-16b53ebad5bc","block_type":"box","text":"income. There could also be changes in the status of issuers under applicable laws and regulations, including tax","page_number":104,"box":{"x":70,"y":770,"width":809,"height":12}},{"id":"61ffe2fb-fa82-4b96-8445-340c3cb337bb","block_type":"box","text":"regulations, that may impact the regulatory or tax treatment of loaned securities and could, for example, result in a","page_number":104,"box":{"x":69,"y":785,"width":821,"height":12}},{"id":"0dc5a36c-9675-418f-ada4-80eb8279535a","block_type":"box","text":"delay in the payment of dividend equivalent payments owed to a Fund (as permitted by applicable law).","page_number":104,"box":{"x":69,"y":801,"width":731,"height":11}},{"id":"d3f753cb-5a42-494c-b238-f72a2e93b28a","block_type":"box","text":"Regulations adopted by global prudential regulators require certain bank-regulated counterparties and certain of","page_number":104,"box":{"x":102,"y":823,"width":800,"height":12}},{"id":"5bc6ab5e-f20c-423d-8695-d6c943a63bee","block_type":"box","text":"their affiliates to include in certain financial contracts, including many securities lending agreements, terms that","page_number":104,"box":{"x":68,"y":838,"width":802,"height":12}},{"id":"f9c1bf6b-ed53-497d-a947-09958f547810","block_type":"box","text":"delay or restrict the rights of counterparties, such as the Fund, to terminate such agreements, foreclose upon","page_number":104,"box":{"x":69,"y":853,"width":783,"height":12}},{"id":"a723dcce-5256-4cff-b097-1aa10ec5a1dc","block_type":"box","text":"collateral, exercise other default rights or restrict transfers of credit support in the event that the counterparty and/or","page_number":104,"box":{"x":69,"y":869,"width":839,"height":11}},{"id":"ea1941a5-13f5-4e68-af9f-e4bfd5c1cde1","block_type":"box","text":"its affiliates are subject to certain types of resolution or insolvency proceedings. It is possible that these","page_number":104,"box":{"x":70,"y":884,"width":747,"height":11}},{"id":"11d9cac0-3bec-4461-bfd1-85eab64216bf","block_type":"box","text":"requirements, as well as potential additional government regulation and other developments in the market, could","page_number":104,"box":{"x":69,"y":899,"width":806,"height":11}},{"id":"417ed98b-1eff-4d4e-a391-f78482ba5a57","block_type":"box","text":"II-73","page_number":104,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"fe2cdc6f-5189-4736-993d-eeafcd26efc7","block_type":"box","text":"NM0926U-5977317-104/232","page_number":104,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"2cf49724-ba22-4bd0-8c82-36809523df11","block_type":"box","text":"adversely affect the Fund’s ability to terminate existing securities lending agreements or to realize amounts to be","page_number":105,"box":{"x":69,"y":45,"width":808,"height":11}},{"id":"9434a6f8-34af-458f-afba-5382a10c61be","block_type":"box","text":"received under such agreements. Prudential regulation may also favor lenders that can provide additional protections,","page_number":105,"box":{"x":69,"y":60,"width":839,"height":11}},{"id":"ce033ccc-02a1-454b-9a48-8ed62b956a88","block_type":"box","text":"such as liens that are exercisable in connection with a lender default, to borrowers. Certain Funds expect to provide","page_number":105,"box":{"x":69,"y":75,"width":827,"height":11}},{"id":"3c205c1f-29bf-4dca-bea0-f965fd94c0e7","block_type":"box","text":"additional protections to borrowers, where permitted pursuant to a Fund’s investment policies and if BlackRock","page_number":105,"box":{"x":69,"y":90,"width":794,"height":11}},{"id":"c83d3dc5-18d0-4e7d-9a29-f059feee79f8","block_type":"box","text":"believes doing so is in the best interest of the Fund.","page_number":105,"box":{"x":69,"y":105,"width":371,"height":11}},{"id":"e29505cd-a351-48e0-996a-c4ffadddb797","block_type":"box","text":"The SEC has adopted a rule that will require reporting and public disclosure of securities loan transaction","page_number":105,"box":{"x":101,"y":128,"width":753,"height":11}},{"id":"a5e5282f-2169-4934-a6f7-5e13132da2e1","block_type":"box","text":"information (not including party names); this may include, but is not limited to, information about securities loans","page_number":105,"box":{"x":70,"y":143,"width":808,"height":11}},{"id":"dd949086-2d17-4478-a0a5-931048a32274","block_type":"box","text":"entered into in connection with short sales. Compliance with this rule is expected to be required in late 2028,","page_number":105,"box":{"x":69,"y":158,"width":784,"height":11}},{"id":"984fd107-8ac8-4eee-88f1-9c4a8ced5177","block_type":"box","text":"although in response to the outcome of a legal challenge against the rule, the SEC may amend the rule and/or delay","page_number":105,"box":{"x":69,"y":173,"width":833,"height":11}},{"id":"6c05492b-f4ee-49c7-954f-501d3f95bd2c","block_type":"box","text":"the current expected compliance date.","page_number":105,"box":{"x":68,"y":188,"width":273,"height":11}},{"id":"0f95f41f-e9ee-44a8-8f33-d8310e564880","block_type":"box","text":"Short Sales.","page_number":105,"box":{"x":101,"y":211,"width":89,"height":9}},{"id":"c4627b6d-f620-4b06-ad0a-c5c021667091","block_type":"box","text":"Certain Funds may make short sales of securities, either as a hedge against potential declines in","page_number":105,"box":{"x":196,"y":211,"width":696,"height":11}},{"id":"57e87ed3-a783-4fa0-b6c7-3be53b00fb18","block_type":"box","text":"value of a portfolio security or to realize appreciation when a security that the Fund does not own declines in value.","page_number":105,"box":{"x":68,"y":226,"width":821,"height":11}},{"id":"cca89985-c40e-4367-98ff-c34c6b069e87","block_type":"box","text":"Certain Funds have a fundamental investment restriction prohibiting short sales of securities unless they are","page_number":105,"box":{"x":69,"y":241,"width":778,"height":11}},{"id":"12840129-cd9d-473f-a90a-1125f336a4ee","block_type":"box","text":"“against-the-box.” In a short sale “against-the-box,” at the time of the sale, the Fund owns or has the immediate and","page_number":105,"box":{"x":70,"y":256,"width":831,"height":12}},{"id":"b5764a59-d385-4eaa-99b7-37545484e168","block_type":"box","text":"unconditional right to acquire the identical security at no additional cost. When a Fund makes a short sale, it borrows","page_number":105,"box":{"x":69,"y":272,"width":837,"height":11}},{"id":"9e184f9f-0c36-4a5c-9b2c-353687a2d26e","block_type":"box","text":"the security sold short and delivers it to the broker-dealer through which it made the short sale. A Fund may have to","page_number":105,"box":{"x":68,"y":287,"width":828,"height":11}},{"id":"850bccf3-bcc8-48f7-b783-0ff2f4910392","block_type":"box","text":"pay a fee to borrow particular securities and is often obligated to turn over any payments received on such borrowed","page_number":105,"box":{"x":70,"y":302,"width":829,"height":11}},{"id":"4ddbfdda-cf20-4803-8912-9c734fa103af","block_type":"box","text":"securities to the lender of the securities.","page_number":105,"box":{"x":69,"y":317,"width":289,"height":9}},{"id":"0afaa190-d818-4049-88e1-be13beb9e9b7","block_type":"box","text":"A Fund secures its obligation to replace the borrowed security by depositing collateral with the broker-dealer,","page_number":105,"box":{"x":101,"y":340,"width":772,"height":11}},{"id":"c891b72b-a82b-4099-b25c-0ca466169966","block_type":"box","text":"usually in cash, U.S. Government Securities or other liquid securities similar to those borrowed. With respect to","page_number":105,"box":{"x":69,"y":355,"width":795,"height":11}},{"id":"6c3c71d3-0f55-43d2-8ee5-cc8317e8ea67","block_type":"box","text":"uncovered short positions, a Fund is required to deposit similar collateral with its custodian, if necessary, to the","page_number":105,"box":{"x":69,"y":370,"width":801,"height":11}},{"id":"4857d0ae-1911-40c9-a753-0b5ee9e6a43a","block_type":"box","text":"extent that the value of both collateral deposits in the aggregate is at all times equal to at least 100% of the current","page_number":105,"box":{"x":69,"y":385,"width":830,"height":11}},{"id":"c3126027-caea-4e3d-9b1a-8807c4affa9c","block_type":"box","text":"market value of the security sold short. Depending on arrangements made with the broker-dealer from which the Fund","page_number":105,"box":{"x":69,"y":400,"width":839,"height":11}},{"id":"307f0908-2d6c-4d15-aa7c-1764d1604cc2","block_type":"box","text":"borrowed the security, regarding payment received by the Fund on such security, a Fund may not receive any","page_number":105,"box":{"x":69,"y":415,"width":770,"height":11}},{"id":"a5ab9780-5bea-434b-8051-9389e8bffca2","block_type":"box","text":"payments (including interest) on its collateral deposited with such broker-dealer.","page_number":105,"box":{"x":70,"y":430,"width":568,"height":11}},{"id":"d2289915-423d-4d38-ac1d-5c5f20a126cc","block_type":"box","text":"Because making short sales in securities that it does not own exposes a Fund to the risks associated with those","page_number":105,"box":{"x":102,"y":453,"width":806,"height":11}},{"id":"0cdd7667-02da-485d-a172-458b673ca462","block_type":"box","text":"securities, such short sales involve speculative exposure risk. A Fund will incur a loss as a result of a short sale if","page_number":105,"box":{"x":69,"y":468,"width":817,"height":11}},{"id":"cd0fda15-a2fc-4ab1-97a1-5158d0fe3254","block_type":"box","text":"the price of the security increases between the date of the short sale and the date on which the Fund replaces the","page_number":105,"box":{"x":68,"y":483,"width":819,"height":11}},{"id":"fac9acc8-9862-4450-a765-9b302b7b2672","block_type":"box","text":"borrowed security. As a result, if a Fund makes short sales in securities that increase in value, it will likely","page_number":105,"box":{"x":69,"y":498,"width":758,"height":11}},{"id":"92eaadd9-caac-4505-8370-08d3a5975f34","block_type":"box","text":"underperform similar mutual funds that do not make short sales in securities. A Fund will realize a gain on a short","page_number":105,"box":{"x":69,"y":513,"width":817,"height":12}},{"id":"b47cb662-3dff-47cf-b722-3486738e5f26","block_type":"box","text":"sale if the security declines in price between those dates. There can be no assurance that a Fund will be able to","page_number":105,"box":{"x":69,"y":528,"width":800,"height":12}},{"id":"1b9244bb-1f0a-4cd9-9edc-e75285bf5f38","block_type":"box","text":"close out a short sale position at any particular time or at an acceptable price. Although a Fund’s gain is limited to","page_number":105,"box":{"x":69,"y":544,"width":818,"height":11}},{"id":"f96d140f-1762-4fa8-b272-be49be4a46d5","block_type":"box","text":"the price at which it sold the security short, its potential loss is limited only by the maximum attainable price of the","page_number":105,"box":{"x":68,"y":559,"width":821,"height":11}},{"id":"5c7b3c72-9d57-44de-a159-497f9b183c6d","block_type":"box","text":"security, less the price at which the security was sold and may, theoretically, be unlimited.","page_number":105,"box":{"x":69,"y":574,"width":640,"height":11}},{"id":"c7ec82a5-ef35-4361-8a37-d3be69edae1c","block_type":"box","text":"A Fund may also make short sales “against the box” without being subject to such limitations.","page_number":105,"box":{"x":101,"y":597,"width":673,"height":11}},{"id":"64f6acaa-726e-4746-a23b-232a84fd45b4","block_type":"box","text":"A Fund must comply with Rule 18f-4 under the Investment Company Act with respect to its short sale","page_number":105,"box":{"x":101,"y":619,"width":721,"height":11}},{"id":"4aca64a3-7ee6-4dc5-baab-72578b1920ed","block_type":"box","text":"borrowings, which are considered Derivatives Transactions under the Rule. See “—Derivatives — Regulation of","page_number":105,"box":{"x":69,"y":634,"width":791,"height":12}},{"id":"c5056e14-5f8c-49aa-a1ac-5ef3b1a993f5","block_type":"box","text":"Derivatives — Rule 18f-4 under the Investment Company Act” above.","page_number":105,"box":{"x":70,"y":649,"width":489,"height":12}},{"id":"2b09aa40-e567-43e4-afcd-dfb868dbb895","block_type":"box","text":"Short sales are also subject to certain SEC regulations and certain European Union and United Kingdom","page_number":105,"box":{"x":102,"y":672,"width":745,"height":11}},{"id":"0dbffffe-1a26-45ee-ac35-b3c72cd0d7d1","block_type":"box","text":"regulations (under which there are restrictions on net short sales in certain securities). If the SEC or regulatory","page_number":105,"box":{"x":69,"y":687,"width":793,"height":11}},{"id":"205ada37-190a-4d01-85c6-ff9ac8e9030b","block_type":"box","text":"authorities in other jurisdictions were to adopt additional restrictions regarding short sales, they could restrict a","page_number":105,"box":{"x":69,"y":703,"width":796,"height":11}},{"id":"a00a13af-675e-4997-b942-4f51ef19b0a4","block_type":"box","text":"Fund’s ability to engage in short sales in certain circumstances, and the Fund may be unable to execute its","page_number":105,"box":{"x":70,"y":718,"width":766,"height":11}},{"id":"777d1dd7-8509-47aa-bab0-ff1ad92f9541","block_type":"box","text":"investment strategy as a result. In response to market events, the SEC and regulatory authorities in other","page_number":105,"box":{"x":70,"y":733,"width":754,"height":11}},{"id":"d41028b4-8ada-4193-a23f-6f2d9e8650a7","block_type":"box","text":"jurisdictions may adopt (and in certain cases, have adopted) bans or other restrictions on short sales of certain","page_number":105,"box":{"x":67,"y":748,"width":800,"height":11}},{"id":"42ae22ea-f774-42c5-9443-7fcac292ff97","block_type":"box","text":"securities or on derivatives and other hedging instruments used to achieve a similar economic effect. Such bans or","page_number":105,"box":{"x":69,"y":763,"width":823,"height":11}},{"id":"c3733856-7da2-4bfa-a28e-921452be30ca","block_type":"box","text":"other restrictions may make it impossible for a Fund to execute certain investment strategies and may have a","page_number":105,"box":{"x":69,"y":778,"width":782,"height":11}},{"id":"d0987a6b-89c0-4680-a1a4-bf834f1ebf9e","block_type":"box","text":"material adverse effect on the Fund’s ability to generate returns.","page_number":105,"box":{"x":69,"y":793,"width":460,"height":11}},{"id":"7e758527-fb2f-48d1-ae89-1b8bc09cc81b","block_type":"box","text":"Special Purpose Acquisition Companies.","page_number":105,"box":{"x":101,"y":816,"width":293,"height":11}},{"id":"5d9ccab1-a6a4-4de6-ad30-6a246cc0bf4c","block_type":"box","text":"A Fund may invest in stock, warrants, rights and other interests issued","page_number":105,"box":{"x":400,"y":816,"width":504,"height":11}},{"id":"9a7051fb-2148-42c2-ad6b-f42028626a67","block_type":"box","text":"by special purpose acquisition companies (“SPACs”) or similar special purpose entities that pool funds to seek","page_number":105,"box":{"x":69,"y":831,"width":791,"height":11}},{"id":"78f9deec-7eff-4a44-b710-d85ef5084355","block_type":"box","text":"potential acquisition opportunities, including the “founder’s” shares and warrants described below. A SPAC is a","page_number":105,"box":{"x":70,"y":846,"width":793,"height":11}},{"id":"c763b9c1-bdfd-4285-ae46-2b9a9e9703a4","block_type":"box","text":"publicly traded company that raises investment capital via an IPO for the purpose of identifying and acquiring one or","page_number":105,"box":{"x":70,"y":861,"width":824,"height":11}},{"id":"4a67cccc-cb90-4a06-b062-d826b937a790","block_type":"box","text":"more operating businesses or assets. In connection with forming a SPAC, the SPAC’s sponsors acquire “founder’s”","page_number":105,"box":{"x":69,"y":876,"width":821,"height":11}},{"id":"a5e2fb32-8277-498f-bc8a-c2357972d747","block_type":"box","text":"shares, generally for nominal consideration, and warrants that will result in the sponsors owning a specified","page_number":105,"box":{"x":69,"y":891,"width":768,"height":12}},{"id":"97e46271-360e-44d8-befb-68efc1877fa3","block_type":"box","text":"percentage (typically 20%) of the SPAC’s outstanding common stock upon completion of the IPO. At the time a SPAC","page_number":105,"box":{"x":70,"y":906,"width":826,"height":12}},{"id":"56ea201e-8073-4005-85c9-3b12db4cf512","block_type":"box","text":"II-74","page_number":105,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"d96da363-706f-4330-978c-c396efc568f1","block_type":"box","text":"NM0926U-5977317-105/232","page_number":105,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"f3c37d97-3f80-47e8-b514-5e255541cc34","block_type":"box","text":"conducts an IPO, it has selected a management team but has not yet identified a specific acquisition opportunity.","page_number":106,"box":{"x":69,"y":45,"width":809,"height":11}},{"id":"840b656b-3e04-4b9c-bed7-11f1c3efff18","block_type":"box","text":"Unless and until an acquisition is completed, a SPAC generally invests its assets in U.S. Government securities,","page_number":106,"box":{"x":70,"y":60,"width":797,"height":11}},{"id":"18bd28d6-1459-4a00-a90e-73d3a2af969a","block_type":"box","text":"money market securities and cash. If an acquisition that meets the requirements for the SPAC is not completed","page_number":106,"box":{"x":69,"y":75,"width":795,"height":11}},{"id":"ad5c282b-6642-44ee-b0c2-35c9f69979fd","block_type":"box","text":"within a pre-established period of time, the invested funds are returned to the SPAC’s public shareholders, the","page_number":106,"box":{"x":68,"y":90,"width":788,"height":11}},{"id":"816e69a8-c84c-4742-8981-b916156d03f8","block_type":"box","text":"warrants expire, and the “founder’s” shares and such warrants become worthless. Because SPACs and similar","page_number":106,"box":{"x":68,"y":105,"width":794,"height":11}},{"id":"45202681-6098-445a-9d47-8b251bb9ed8e","block_type":"box","text":"entities are in essence “blank check” companies without operating histories or ongoing business operations (other","page_number":106,"box":{"x":69,"y":120,"width":820,"height":12}},{"id":"6f11d0a1-82c0-4b0d-a0e1-5664f65e0041","block_type":"box","text":"than identifying and pursuing acquisitions), the potential for the long-term capital appreciation of their securities is","page_number":106,"box":{"x":68,"y":135,"width":815,"height":12}},{"id":"70344cd8-6a66-4fe8-913e-97d7602a8b57","block_type":"box","text":"particularly dependent on the ability of the SPAC’s management to identify and complete a profitable acquisition.","page_number":106,"box":{"x":70,"y":150,"width":802,"height":12}},{"id":"c741783f-c8da-45fd-905d-79fdd11144c9","block_type":"box","text":"There is no guarantee that the SPACs in which a Fund invests will complete an acquisition or that any acquisitions","page_number":106,"box":{"x":68,"y":166,"width":812,"height":11}},{"id":"f6665e82-2d03-499a-8e59-4ffa3ba75a4b","block_type":"box","text":"completed by the SPACs in which the Fund invests will be profitable. Some SPACs may pursue acquisitions only within","page_number":106,"box":{"x":69,"y":181,"width":838,"height":11}},{"id":"1383551e-5626-43f6-b742-d579bdd0663f","block_type":"box","text":"certain industries or regions, which may ultimately lead to an increase in the volatility of their prices following the","page_number":106,"box":{"x":69,"y":196,"width":806,"height":11}},{"id":"58ae5327-9bfd-49e9-bafc-9ba686749d3d","block_type":"box","text":"acquisition. In addition, some of these securities may be considered illiquid and/or subject to restrictions on resale.","page_number":106,"box":{"x":69,"y":211,"width":828,"height":11}},{"id":"56bcb5f3-af93-4afe-9261-6218628db2f4","block_type":"box","text":"Standby Commitment Agreements.","page_number":106,"box":{"x":101,"y":234,"width":255,"height":11}},{"id":"1a0d7f51-26d9-41c7-b97d-e7a88c3f9bff","block_type":"box","text":"Standby commitment agreements commit a Fund, for a stated period of","page_number":106,"box":{"x":362,"y":234,"width":511,"height":11}},{"id":"6be40c0b-b03f-4ee9-84a9-3c571cd61723","block_type":"box","text":"time, to purchase a stated amount of securities that may be issued and sold to that Fund at the option of the issuer.","page_number":106,"box":{"x":68,"y":249,"width":834,"height":11}},{"id":"ec19af4d-b242-4850-b4a4-56c6fcb09b14","block_type":"box","text":"The price of the security is fixed at the time of the commitment. At the time of entering into the agreement, a Fund is","page_number":106,"box":{"x":68,"y":264,"width":834,"height":11}},{"id":"a137e1ea-bd09-4e7b-92a5-3fb0a24470fc","block_type":"box","text":"paid a commitment fee, regardless of whether or not the security is ultimately issued. A Fund will enter into such","page_number":106,"box":{"x":70,"y":279,"width":802,"height":11}},{"id":"7520f12b-9574-48a9-a00a-df7fcdb2b107","block_type":"box","text":"agreements for the purpose of investing in the security underlying the commitment at a price that is considered","page_number":106,"box":{"x":69,"y":294,"width":793,"height":11}},{"id":"ba2a62d8-f0f0-4888-b74c-e8ad4fa41c9e","block_type":"box","text":"advantageous to the Fund.","page_number":106,"box":{"x":69,"y":309,"width":188,"height":11}},{"id":"b94eaef4-af04-4b66-9b41-bef30973e8ab","block_type":"box","text":"There can be no assurance that the securities subject to a standby commitment will be issued, and the value of","page_number":106,"box":{"x":101,"y":332,"width":800,"height":11}},{"id":"4eab3c5f-f614-4d01-a7d8-654578117794","block_type":"box","text":"the security, if issued, on the delivery date may be more or less than its purchase price. Since the issuance of the","page_number":106,"box":{"x":68,"y":347,"width":816,"height":11}},{"id":"dffbc226-c1f5-4dee-b791-b17c2a3eb76a","block_type":"box","text":"security underlying the commitment is at the option of the issuer, the Fund may bear the risk of a decline in the value","page_number":106,"box":{"x":69,"y":362,"width":835,"height":11}},{"id":"ea5c9fcf-431b-4223-9ae3-ca83113d15d6","block_type":"box","text":"of such security and may not benefit from an appreciation in the value of the security during the commitment period.","page_number":106,"box":{"x":69,"y":377,"width":828,"height":12}},{"id":"10b33045-e1fa-4dbd-bf1e-3a79ba00b4d9","block_type":"box","text":"The purchase of a security pursuant to a standby commitment agreement and the related commitment fee will","page_number":106,"box":{"x":101,"y":400,"width":785,"height":11}},{"id":"5357aa19-1526-4731-94d0-82f8ab4cc930","block_type":"box","text":"be recorded on the date on which the security can reasonably be expected to be issued, and the value of the security","page_number":106,"box":{"x":69,"y":415,"width":837,"height":11}},{"id":"c91ea5a9-8336-4af4-86ca-4ddaa35ae002","block_type":"box","text":"thereafter will be reflected in the calculation of a Fund’s NAV. The cost basis of the security will be adjusted by the","page_number":106,"box":{"x":68,"y":430,"width":815,"height":11}},{"id":"c7175190-2103-4a9a-839b-b9dc02a3f357","block_type":"box","text":"amount of the commitment fee. In the event the security is not issued, the commitment fee will be recorded as","page_number":106,"box":{"x":69,"y":445,"width":792,"height":11}},{"id":"5fb6485f-d4c1-4fd1-80ec-398af958ec52","block_type":"box","text":"income on the expiration date of the standby commitment.","page_number":106,"box":{"x":70,"y":460,"width":415,"height":12}},{"id":"bcf79d76-2f1c-4e65-bea9-112e0add28f7","block_type":"box","text":"Standby commitments will only be entered into with dealers, banks and broker-dealers which, in the Manager’s","page_number":106,"box":{"x":102,"y":483,"width":789,"height":11}},{"id":"7500c628-2c57-4ad6-b9eb-acb0f805277b","block_type":"box","text":"or sub-adviser’s opinion, present minimal credit risks. A Fund will acquire standby commitments solely to facilitate","page_number":106,"box":{"x":69,"y":498,"width":814,"height":11}},{"id":"4a8de792-70cd-43dc-95d8-f4b1501028e3","block_type":"box","text":"portfolio liquidity and not to exercise its rights thereunder for trading purposes. Standby commitments will be valued","page_number":106,"box":{"x":70,"y":513,"width":827,"height":12}},{"id":"8949940c-3a84-4844-93c8-84a8ea0c432c","block_type":"box","text":"at zero in determining NAV. Accordingly, where a Fund pays directly or indirectly for a standby commitment, its cost","page_number":106,"box":{"x":69,"y":528,"width":815,"height":12}},{"id":"48d458d8-a11f-4e9b-88e8-a4ae2c9d4b76","block_type":"box","text":"will be reflected as an unrealized loss for the period during which the commitment is held by such Fund and will be","page_number":106,"box":{"x":68,"y":543,"width":817,"height":12}},{"id":"ef548c47-5a66-4586-9bc4-febd12253b21","block_type":"box","text":"reflected as a realized gain or loss when the commitment is exercised or expires.","page_number":106,"box":{"x":69,"y":559,"width":578,"height":11}},{"id":"f569dd9d-d4cd-48b9-88bc-93f92d848db1","block_type":"box","text":"Stripped Securities.","page_number":106,"box":{"x":101,"y":581,"width":143,"height":11}},{"id":"ad42b6e0-a096-4477-ae9f-479f0c1aba37","block_type":"box","text":"Stripped securities are created when the issuer separates the interest and principal","page_number":106,"box":{"x":251,"y":581,"width":596,"height":11}},{"id":"8d43affa-02f0-4322-8e77-12338c87a9ac","block_type":"box","text":"components of an instrument and sells them as separate securities. In general, one security is entitled to receive the","page_number":106,"box":{"x":69,"y":596,"width":839,"height":12}},{"id":"e3f99b04-4016-40fa-81cc-b45189ff6fc4","block_type":"box","text":"interest payments on the underlying assets (the interest only or “IO” security) and the other to receive the principal","page_number":106,"box":{"x":70,"y":612,"width":818,"height":11}},{"id":"d406a55a-c361-42fc-a499-ea9ef409e653","block_type":"box","text":"payments (the principal only or “PO” security). Some stripped securities may receive a combination of interest and","page_number":106,"box":{"x":70,"y":627,"width":813,"height":11}},{"id":"be80d7d0-1e95-4031-b3d7-47ed537c26b9","block_type":"box","text":"principal payments. The yields to maturity on IOs and POs are sensitive to the expected or anticipated rate of","page_number":106,"box":{"x":70,"y":642,"width":777,"height":11}},{"id":"f239af28-5c30-4618-ab69-8b6d0abe9591","block_type":"box","text":"principal payments (including prepayments) on the related underlying assets, and principal payments may have a","page_number":106,"box":{"x":70,"y":657,"width":802,"height":11}},{"id":"42de2ba0-9ed7-47c4-8b07-530e3c240a9a","block_type":"box","text":"material effect on yield to maturity. If the underlying assets experience greater than anticipated prepayments of","page_number":106,"box":{"x":69,"y":672,"width":794,"height":11}},{"id":"9ae4d1f4-59c4-4b49-92e6-e30b44808510","block_type":"box","text":"principal, a Fund may not fully recoup its initial investment in IOs. Conversely, if the underlying assets experience less","page_number":106,"box":{"x":70,"y":687,"width":837,"height":11}},{"id":"8e3267bb-a1f3-4119-8e15-e5b9c1f69bc5","block_type":"box","text":"than anticipated prepayments of principal, the yield on POs could be adversely affected. Stripped securities may be","page_number":106,"box":{"x":68,"y":702,"width":823,"height":11}},{"id":"8413301c-0f49-4a9e-83d1-3ae5553f9bc4","block_type":"box","text":"highly sensitive to changes in interest rates and rates of prepayment.","page_number":106,"box":{"x":69,"y":717,"width":494,"height":12}},{"id":"5dd10e81-1e68-4006-b8a4-b2313433f971","block_type":"box","text":"Structured Notes.","page_number":106,"box":{"x":101,"y":740,"width":130,"height":9}},{"id":"252a476c-7f35-4030-9d11-06f0dcd4f92f","block_type":"box","text":"Structured notes and other related instruments purchased by a Fund are generally privately","page_number":106,"box":{"x":237,"y":740,"width":650,"height":11}},{"id":"79a502da-8f8d-470e-b1d6-54ee77b84a6e","block_type":"box","text":"negotiated debt obligations where the principal and/or interest is determined by reference to the performance of a","page_number":106,"box":{"x":69,"y":755,"width":818,"height":11}},{"id":"db797721-1216-4ef0-a5ff-2826662d0ebd","block_type":"box","text":"specific asset, benchmark asset, market or interest rate (“reference measure”). Issuers of structured notes generally","page_number":106,"box":{"x":69,"y":770,"width":839,"height":12}},{"id":"0e4be383-6608-40a7-87bd-06c2e5decf0e","block_type":"box","text":"include corporations and banks. The interest rate or the principal amount payable upon maturity or redemption may","page_number":106,"box":{"x":70,"y":786,"width":821,"height":11}},{"id":"fb8c090c-e4b5-4ba2-9744-f6afc01e0611","block_type":"box","text":"increase or decrease, depending upon changes in the value of the reference measure. The terms of a structured note","page_number":106,"box":{"x":70,"y":801,"width":839,"height":11}},{"id":"19e20048-7c4d-4b1a-8870-972f6d09730b","block_type":"box","text":"may provide that, in certain circumstances, no principal is due at maturity and, therefore, may result in a loss of","page_number":106,"box":{"x":69,"y":816,"width":801,"height":11}},{"id":"16254051-32a3-4df3-9f9f-8b80e22542bd","block_type":"box","text":"invested capital by a Fund. The interest and/or principal payments that may be made on a structured product may","page_number":106,"box":{"x":70,"y":831,"width":813,"height":11}},{"id":"bee27bc3-5710-4057-a622-344cc4f88b91","block_type":"box","text":"vary widely, depending on a variety of factors, including the volatility of the reference measure.","page_number":106,"box":{"x":68,"y":846,"width":673,"height":11}},{"id":"626907d8-c37f-4413-a98d-23561bd6c7d2","block_type":"box","text":"Structured notes may be positively or negatively indexed, so the appreciation of the reference measure may","page_number":106,"box":{"x":102,"y":869,"width":768,"height":11}},{"id":"079d05c7-297e-46b7-a1b4-98f8abf32c5c","block_type":"box","text":"produce an increase or a decrease in the interest rate or the value of the principal at maturity. The rate of return on","page_number":106,"box":{"x":70,"y":884,"width":821,"height":11}},{"id":"5e5a9dc2-6ff0-4479-ad1c-9d525caeaa9a","block_type":"box","text":"II-75","page_number":106,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"fef641d7-bf88-4353-adf5-6399fee40b63","block_type":"box","text":"NM0926U-5977317-106/232","page_number":106,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"1effe45f-9633-4f7e-8450-7c9bf54c355c","block_type":"box","text":"structured notes may be determined by applying a multiplier to the performance or differential performance of","page_number":107,"box":{"x":69,"y":45,"width":787,"height":11}},{"id":"7447acde-af51-4faa-8b8e-1d909f20ac6a","block_type":"box","text":"reference measures. Application of a multiplier involves leverage that will serve to magnify the potential for gain and","page_number":107,"box":{"x":69,"y":60,"width":827,"height":11}},{"id":"e3ade638-c0a2-4589-be7e-e22e8e1bf020","block_type":"box","text":"the risk of loss.","page_number":107,"box":{"x":68,"y":75,"width":110,"height":9}},{"id":"4c529b26-7279-4d85-bd99-3003b05da194","block_type":"box","text":"The purchase of structured notes exposes a Fund to the credit risk of the issuer of the structured product.","page_number":107,"box":{"x":101,"y":98,"width":759,"height":11}},{"id":"e5cf0702-1755-44a4-aaeb-9e056ad176ac","block_type":"box","text":"Structured notes may also be more volatile, less liquid, and more difficult to price accurately than less complex","page_number":107,"box":{"x":69,"y":113,"width":795,"height":11}},{"id":"ef08a948-65cc-4c6f-87c3-fb0679ddada6","block_type":"box","text":"securities and instruments or more traditional debt securities. The secondary market for structured notes could be","page_number":107,"box":{"x":69,"y":128,"width":819,"height":11}},{"id":"4c112354-441e-4313-9341-97968ff1e1cb","block_type":"box","text":"illiquid making them difficult to sell when the Fund determines to sell them. The possible lack of a liquid secondary","page_number":107,"box":{"x":70,"y":143,"width":821,"height":11}},{"id":"17a2764c-f4be-4cc2-bf0d-398868213f5a","block_type":"box","text":"market for structured notes and the resulting inability of the Fund to sell a structured note could expose the Fund to","page_number":107,"box":{"x":69,"y":158,"width":827,"height":11}},{"id":"51c45e7c-9a27-4180-b379-3e488dc68739","block_type":"box","text":"losses and could make structured notes more difficult for the Fund to value accurately.","page_number":107,"box":{"x":70,"y":173,"width":618,"height":11}},{"id":"d32359a1-fcc3-4a06-8c00-6723944b14c2","block_type":"box","text":"Taxability Risk.","page_number":107,"box":{"x":103,"y":196,"width":109,"height":11}},{"id":"5fad01c0-b68c-4873-9108-c6b14a6f24ee","block_type":"box","text":"Certain of the Funds intend to minimize the payment of taxable income to shareholders by","page_number":107,"box":{"x":218,"y":196,"width":644,"height":11}},{"id":"14f489a9-07f7-44a1-9445-d951e234a8d8","block_type":"box","text":"investing in tax-exempt or municipal securities in reliance at the time of purchase on an opinion of bond counsel to","page_number":107,"box":{"x":70,"y":211,"width":817,"height":11}},{"id":"673e1efe-8d1d-45d1-861c-f9e9ec534dfd","block_type":"box","text":"the issuer and, in the case of derivative securities, sponsors’ counsel, that the interest paid on those securities will","page_number":107,"box":{"x":68,"y":226,"width":827,"height":11}},{"id":"7e8659b3-0862-4655-87fc-1c5df3128158","block_type":"box","text":"be excludable from gross income for U.S. federal income tax purposes. Such securities, however, may be determined","page_number":107,"box":{"x":69,"y":241,"width":835,"height":11}},{"id":"aacc386f-69fe-4ae8-afc8-57836b8bcc08","block_type":"box","text":"to pay, or have paid, taxable income subsequent to the Fund’s acquisition of the securities. In that event, the IRS","page_number":107,"box":{"x":68,"y":256,"width":809,"height":11}},{"id":"460c759b-e145-465f-8258-6dd1a53701dc","block_type":"box","text":"may demand that the Fund pay U.S. federal income taxes on the affected interest income, and, if the Fund agrees to","page_number":107,"box":{"x":69,"y":271,"width":832,"height":12}},{"id":"7514b5fb-267c-442b-8402-e3cd84ccf0bc","block_type":"box","text":"do so, the Fund’s yield could be adversely affected. In addition, the treatment of dividends previously paid or to be","page_number":107,"box":{"x":69,"y":286,"width":816,"height":12}},{"id":"592eee1f-56fc-4d3f-a591-38c9ec716815","block_type":"box","text":"paid by the Fund as “exempt interest dividends” could be adversely affected, subjecting the Fund’s shareholders to","page_number":107,"box":{"x":70,"y":302,"width":822,"height":11}},{"id":"15b81971-3ae9-4cf6-9832-e14e66c98ddd","block_type":"box","text":"increased U.S. federal income tax liabilities. If the interest paid on any tax-exempt or municipal security held by the","page_number":107,"box":{"x":70,"y":317,"width":818,"height":11}},{"id":"f7e0f637-0a97-4c3e-b7f6-9ab3ec15fe48","block_type":"box","text":"Fund is subsequently determined to be taxable, the Fund will dispose of that security as soon as reasonably","page_number":107,"box":{"x":70,"y":332,"width":771,"height":11}},{"id":"dd03b870-9eb1-4a19-be1a-ceac3caaafe3","block_type":"box","text":"practicable. In addition, future laws, regulations, rulings or court decisions may cause interest on municipal","page_number":107,"box":{"x":70,"y":347,"width":765,"height":11}},{"id":"daf7d13d-39fe-42e6-8dd8-84f885ec3234","block_type":"box","text":"securities to be subject, directly or indirectly, to U.S. federal income taxation or interest on state municipal securities","page_number":107,"box":{"x":69,"y":362,"width":834,"height":11}},{"id":"75eb184d-e5d8-42ed-93f8-99c23eb2044c","block_type":"box","text":"to be subject to state or local income taxation, or the value of state municipal securities to be subject to state or","page_number":107,"box":{"x":68,"y":377,"width":807,"height":11}},{"id":"d804f2ef-fc73-43f3-82fa-d398a6a1dcba","block_type":"box","text":"local intangible personal property tax, or may otherwise prevent the Fund from realizing the full current benefit of the","page_number":107,"box":{"x":70,"y":392,"width":830,"height":12}},{"id":"99a2dddd-54e6-4045-a234-33cc95c61e1e","block_type":"box","text":"tax-exempt status of such securities. Any such change could also affect the market price of such securities, and thus","page_number":107,"box":{"x":68,"y":407,"width":838,"height":12}},{"id":"35205179-c1c6-446f-bc64-1af4d01d5f99","block_type":"box","text":"the value of an investment in the Fund.","page_number":107,"box":{"x":68,"y":423,"width":278,"height":9}},{"id":"ed215b71-6756-4730-84f7-d87647557e8d","block_type":"box","text":"Temporary Defensive Measures.","page_number":107,"box":{"x":103,"y":445,"width":230,"height":11}},{"id":"cfcfa9a6-256b-4cf6-af5b-5579c7f9f6a3","block_type":"box","text":"As a temporary defensive measure, including to respond to adverse market,","page_number":107,"box":{"x":339,"y":445,"width":542,"height":12}},{"id":"7c4b3378-2f4f-480b-bbd7-305941278889","block_type":"box","text":"economic, political or other conditions, a Fund may depart from its principal investment strategies and may invest","page_number":107,"box":{"x":69,"y":460,"width":811,"height":12}},{"id":"fcdea921-1df2-449a-b10d-ee6eeb05f504","block_type":"box","text":"without limitation in cash, high quality money market instruments, or other short term investments. Certain Funds","page_number":107,"box":{"x":68,"y":476,"width":813,"height":11}},{"id":"fb63cdfd-7696-445b-bf49-94b42233695d","block_type":"box","text":"may also invest in cash and other such instruments pending investment or to meet anticipated redemption requests.","page_number":107,"box":{"x":69,"y":491,"width":833,"height":11}},{"id":"c94feac5-3390-4bde-abb6-ec08b21a0ba3","block_type":"box","text":"High quality money market instruments include U.S. Government obligations, U.S. Government agency obligations,","page_number":107,"box":{"x":70,"y":506,"width":813,"height":11}},{"id":"816382bc-bb8c-4a81-9567-65b946968823","block_type":"box","text":"dollar denominated obligations of foreign issuers, bank obligations, including U.S. subsidiaries and branches of","page_number":107,"box":{"x":69,"y":521,"width":795,"height":11}},{"id":"769aee10-571c-4e0c-96d4-7bb55e7c8d81","block_type":"box","text":"foreign banks, corporate obligations, commercial paper, repurchase agreements and obligations of supranational","page_number":107,"box":{"x":68,"y":536,"width":806,"height":11}},{"id":"63edd54a-955a-4b2c-bd16-2b2cd65c99a1","block_type":"box","text":"organizations. Generally, such obligations will mature within one year from the date of settlement but may mature","page_number":107,"box":{"x":69,"y":551,"width":808,"height":11}},{"id":"3c6c4480-3c72-4c2b-966e-f41e166fda00","block_type":"box","text":"within two years from the date of settlement. Temporary defensive measures may affect a Fund’s ability to achieve","page_number":107,"box":{"x":68,"y":566,"width":820,"height":11}},{"id":"dfe11f69-11ae-4a39-90e6-b3c883ff62e0","block_type":"box","text":"its investment objective.","page_number":107,"box":{"x":70,"y":582,"width":171,"height":10}},{"id":"7c670581-f06e-4c94-a41e-0f9d07cc7445","block_type":"box","text":"U.S. Government Obligations.","page_number":107,"box":{"x":102,"y":604,"width":213,"height":11}},{"id":"5901f9a2-83d5-4fa0-ab81-fb4340c92f4f","block_type":"box","text":"A Fund may purchase obligations issued or guaranteed by the U.S. Government","page_number":107,"box":{"x":321,"y":604,"width":566,"height":11}},{"id":"5b91975f-6704-407f-8267-e6a2d9e2d750","block_type":"box","text":"and U.S. Government agencies and instrumentalities. Obligations of certain agencies and instrumentalities of the","page_number":107,"box":{"x":69,"y":619,"width":810,"height":11}},{"id":"cf4da664-e6e4-429d-9591-8c2143c5ac8a","block_type":"box","text":"U.S. Government are supported by the full faith and credit of the U.S. Treasury. Others are supported by the right of","page_number":107,"box":{"x":70,"y":634,"width":826,"height":12}},{"id":"93bb75fb-7e4a-466d-b704-76a8437ea5cb","block_type":"box","text":"the issuer to borrow from the U.S. Treasury; and still others are supported only by the credit of the agency or","page_number":107,"box":{"x":68,"y":649,"width":779,"height":12}},{"id":"3cd6c654-b0cd-4bc2-87a1-98535c479bd7","block_type":"box","text":"instrumentality issuing the obligation. No assurance can be given that the U.S. Government will provide financial","page_number":107,"box":{"x":70,"y":664,"width":798,"height":12}},{"id":"5383e4ce-d399-464e-b217-a400d6051651","block_type":"box","text":"support to U.S. Government-sponsored instrumentalities if it is not obligated to do so by law. Certain U.S. Treasury","page_number":107,"box":{"x":69,"y":680,"width":822,"height":11}},{"id":"6f99304a-f10e-42fa-834b-9a2a5c051da5","block_type":"box","text":"and agency securities may be held by trusts that issue participation certificates (such as Treasury income growth","page_number":107,"box":{"x":69,"y":695,"width":809,"height":11}},{"id":"5d219872-89ae-4260-a941-6a53676fcc86","block_type":"box","text":"receipts and certificates of accrual on Treasury certificates). These certificates, as well as Treasury receipts and","page_number":107,"box":{"x":69,"y":710,"width":805,"height":11}},{"id":"d5a67eb0-c3bd-45c9-920f-efa005b33d90","block_type":"box","text":"other stripped securities, represent beneficial ownership interests in either future interest payments or the future","page_number":107,"box":{"x":69,"y":725,"width":807,"height":11}},{"id":"4cc2768f-7979-45a8-99fe-335e1dad297b","block_type":"box","text":"principal payments on U.S. Government obligations. These instruments are issued at a discount to their “face value”","page_number":107,"box":{"x":70,"y":740,"width":832,"height":11}},{"id":"dc5ab4c2-f23c-4d5c-bb9b-5fa9aae0133d","block_type":"box","text":"and may (particularly in the case of stripped mortgage-backed securities) exhibit greater price volatility than ordinary","page_number":107,"box":{"x":69,"y":755,"width":829,"height":11}},{"id":"b57cdcc1-715b-4b06-afbb-b97e776a1700","block_type":"box","text":"debt securities because of the manner in which their principal and interest are returned to investors.","page_number":107,"box":{"x":69,"y":770,"width":716,"height":11}},{"id":"9f2ea90a-dde1-4768-92f2-2166698475c8","block_type":"box","text":"Examples of the types of U.S. Government obligations that may be held by the Funds include U.S. Treasury Bills,","page_number":107,"box":{"x":102,"y":793,"width":800,"height":11}},{"id":"b542b6e2-b4f0-409b-a72a-2eeb4dcb1211","block_type":"box","text":"Treasury Notes and Treasury Bonds and the obligations of the Federal Housing Administration, Farmers Home","page_number":107,"box":{"x":68,"y":808,"width":785,"height":11}},{"id":"4fc3caf3-59a4-4318-b537-3e0a5d68f362","block_type":"box","text":"Administration, Export-Import Bank of the United States, Small Business Administration, Ginnie Mae, Fannie Mae,","page_number":107,"box":{"x":68,"y":823,"width":813,"height":11}},{"id":"ec8ad458-2650-472d-9af9-73cbf48f08fe","block_type":"box","text":"Federal Financing Bank, General Services Administration, Student Loan Marketing Association, Central Bank for","page_number":107,"box":{"x":70,"y":838,"width":794,"height":12}},{"id":"f253d28f-e94a-424a-9dfc-3bbc468f9b09","block_type":"box","text":"Cooperatives, Federal Home Loan Banks, Freddie Mac, Federal Intermediate Credit Banks, Federal Land Banks, Farm","page_number":107,"box":{"x":69,"y":854,"width":835,"height":10}},{"id":"7675fa04-65fb-4cf7-a92b-e1bc3f1b6d62","block_type":"box","text":"Credit Banks System, Maritime Administration, Tennessee Valley Authority and Washington D.C. Armory Board. The","page_number":107,"box":{"x":69,"y":869,"width":818,"height":11}},{"id":"3b913715-31db-4124-aa62-0e83c2efa144","block_type":"box","text":"Funds may also invest in mortgage-related securities issued or guaranteed by U.S. Government agencies and","page_number":107,"box":{"x":70,"y":884,"width":777,"height":11}},{"id":"09dde6aa-524d-4bd8-bd64-b3478ae60312","block_type":"box","text":"instrumentalities, including such instruments as obligations of Ginnie Mae, Fannie Mae and Freddie Mac.","page_number":107,"box":{"x":70,"y":899,"width":749,"height":11}},{"id":"84c1bacf-70d6-449a-8ee5-b2cf2c76fcf1","block_type":"box","text":"II-76","page_number":107,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"990485ab-f891-473e-ba6f-99339c790f80","block_type":"box","text":"NM0926U-5977317-107/232","page_number":107,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"899806b5-a553-42a8-8d35-d028b184f0cd","block_type":"box","text":"U.S. Treasury Obligations.","page_number":108,"box":{"x":103,"y":45,"width":183,"height":11}},{"id":"14d888df-78f7-4938-8cd4-74d1ff2bc7cc","block_type":"box","text":"Treasury obligations may differ in their interest rates, maturities, times of issuance","page_number":108,"box":{"x":292,"y":45,"width":593,"height":11}},{"id":"141fe132-a8b3-4a33-a257-84d1c04c7510","block_type":"box","text":"and other characteristics. Obligations of U.S. Government agencies and authorities are supported by varying degrees","page_number":108,"box":{"x":69,"y":60,"width":835,"height":11}},{"id":"59f14aae-e418-42db-980b-4a03b63fba4a","block_type":"box","text":"of credit but generally are not backed by the full faith and credit of the U.S. Government. No assurance can be given","page_number":108,"box":{"x":69,"y":75,"width":827,"height":11}},{"id":"35fe0370-7c50-41b9-8b8e-ddcff5f66096","block_type":"box","text":"that the U.S. Government will provide financial support to its agencies and authorities if it is not obligated by law to","page_number":108,"box":{"x":68,"y":90,"width":823,"height":11}},{"id":"8e86b7f3-f209-43e6-9b71-b6b63dfe924f","block_type":"box","text":"do so.","page_number":108,"box":{"x":69,"y":105,"width":42,"height":9}},{"id":"1f030a84-377e-497f-b855-548614a22089","block_type":"box","text":"U.S. Treasury Rolls","page_number":108,"box":{"x":102,"y":128,"width":139,"height":11}},{"id":"10d98030-5776-4f46-accb-c868e9898281","block_type":"box","text":".","page_number":108,"box":{"x":241,"y":135,"width":3,"height":2}},{"id":"c20f3883-5a41-46dd-92f9-2b6515f9250c","block_type":"box","text":"Certain Funds may invest in U.S. Treasury rolls. In a U.S. Treasury roll transaction, the Fund","page_number":108,"box":{"x":250,"y":128,"width":656,"height":11}},{"id":"937ffde6-8884-4b5e-8aa7-426f463e33cc","block_type":"box","text":"sells a treasury security to a counterparty with a simultaneous agreement to repurchase the same security at an","page_number":108,"box":{"x":69,"y":143,"width":804,"height":11}},{"id":"cd0d6745-24bd-4883-b837-e8121e06cb4e","block_type":"box","text":"agreed upon price and future settlement date. U.S. Treasury roll transactions may incrementally adjust the average","page_number":108,"box":{"x":69,"y":158,"width":820,"height":11}},{"id":"72a75fee-bba1-4c61-9e50-e9a42cf36b74","block_type":"box","text":"maturity of a Fund’s portfolio and increase the interest yield on the Fund’s portfolio by extending the average maturity","page_number":108,"box":{"x":69,"y":173,"width":840,"height":11}},{"id":"2ba6fe08-55ac-41d0-91b3-a3d1a52a01c6","block_type":"box","text":"of the portfolio in a normal yield curve environment. During the period before the settlement date of a U.S. Treasury","page_number":108,"box":{"x":69,"y":188,"width":828,"height":12}},{"id":"e693ee93-b495-48fa-b53f-2e8e42c456d9","block_type":"box","text":"roll, a Fund continues to earn interest on the securities it is selling; however, it does not earn interest on the","page_number":108,"box":{"x":69,"y":204,"width":775,"height":11}},{"id":"9c466a9b-9299-467d-9b45-22832a1979b7","block_type":"box","text":"securities it is purchasing until after the settlement date. A Fund could suffer an opportunity loss if the counterparty","page_number":108,"box":{"x":69,"y":218,"width":829,"height":12}},{"id":"4407d11e-c74f-4c99-a54a-daf84de1963a","block_type":"box","text":"to the U.S. Treasury roll transaction failed to perform its obligations on the settlement date.","page_number":108,"box":{"x":68,"y":234,"width":657,"height":11}},{"id":"1d8ff9a1-ce80-4782-8971-693a4c39aff2","block_type":"box","text":"The market value of the securities that a Fund is required to purchase may decline below the agreed upon","page_number":108,"box":{"x":101,"y":256,"width":756,"height":12}},{"id":"3c0a1580-84e4-4cb1-931c-a56f9a7b2d87","block_type":"box","text":"purchase price of those securities. U.S. Treasury rolls are speculative techniques that can be deemed to involve","page_number":108,"box":{"x":70,"y":271,"width":800,"height":12}},{"id":"47af5106-1ff5-49d3-87d5-5aacc6e8b346","block_type":"box","text":"leverage. There is no assurance that U.S. Treasury rolls can be successfully employed.","page_number":108,"box":{"x":70,"y":286,"width":617,"height":12}},{"id":"2976922d-9103-4ff8-ae1f-1b8ba4dc39bf","block_type":"box","text":"Utility Industries.","page_number":108,"box":{"x":102,"y":309,"width":124,"height":11}},{"id":"6f824dcc-2646-4d7c-88ab-c6b15021da41","block_type":"box","text":"Risks that are intrinsic to the utility industries include difficulty in obtaining an adequate return","page_number":108,"box":{"x":233,"y":309,"width":674,"height":11}},{"id":"f4826c57-9e46-4c2b-a581-4cd18d3bbdfb","block_type":"box","text":"on invested capital, difficulty in financing large construction programs during an inflationary period, restrictions on","page_number":108,"box":{"x":69,"y":324,"width":812,"height":12}},{"id":"c5867c47-87d5-43e8-acd7-426c89b33932","block_type":"box","text":"operations and increased cost and delays attributable to environmental considerations and regulation, difficulty in","page_number":108,"box":{"x":69,"y":339,"width":812,"height":12}},{"id":"d00b591e-6dd8-4ca2-a0a0-e3d50aedf24b","block_type":"box","text":"raising capital in adequate amounts on reasonable terms in periods of high inflation and unsettled capital markets,","page_number":108,"box":{"x":69,"y":355,"width":821,"height":11}},{"id":"8b293973-9011-472c-ba7a-3db97a52d7fb","block_type":"box","text":"technological innovations that may render existing plants, equipment or products obsolete, the potential impact of","page_number":108,"box":{"x":68,"y":370,"width":815,"height":11}},{"id":"c1606c05-5f49-4390-846a-628f7018d097","block_type":"box","text":"natural or man-made disasters, increased costs and reduced availability of certain types of fuel, occasional reduced","page_number":108,"box":{"x":69,"y":385,"width":827,"height":11}},{"id":"8efad27e-24da-4680-a8ac-df8bac588dfa","block_type":"box","text":"availability and high costs of natural gas for resale, the effects of energy conservation, the effects of a national","page_number":108,"box":{"x":69,"y":400,"width":795,"height":11}},{"id":"30a96ebd-5cb3-4f58-abb9-5b935d471e8a","block_type":"box","text":"energy policy and lengthy delays and greatly increased costs and other problems associated with the design,","page_number":108,"box":{"x":69,"y":415,"width":774,"height":11}},{"id":"6e93ef88-0346-4013-af2e-be9ce0bd6c3e","block_type":"box","text":"construction, licensing, regulation and operation of nuclear facilities for electric generation, including, among other","page_number":108,"box":{"x":69,"y":430,"width":817,"height":11}},{"id":"d5e8c9c6-20f7-4649-a940-3dc2745d0327","block_type":"box","text":"considerations, the problems associated with the use of radioactive materials and the disposal of radioactive wastes.","page_number":108,"box":{"x":69,"y":445,"width":839,"height":11}},{"id":"8cf81414-5777-400e-8d2e-2c9f8057ee3a","block_type":"box","text":"There are substantial differences among the regulatory practices and policies of various jurisdictions, and any given","page_number":108,"box":{"x":68,"y":460,"width":827,"height":12}},{"id":"a4dd5991-090d-4884-8a2a-56342e0daab4","block_type":"box","text":"regulatory agency may make major shifts in policy from time to time. There is no assurance that regulatory","page_number":108,"box":{"x":69,"y":475,"width":761,"height":12}},{"id":"63b6b21d-92df-4f6a-9b10-cd48c603c8d8","block_type":"box","text":"authorities will, in the future, grant rate increases or that such increases will be adequate to permit the payment of","page_number":108,"box":{"x":69,"y":491,"width":821,"height":11}},{"id":"d56b75e3-7e7e-46a1-89d8-4dcbf3359f71","block_type":"box","text":"dividends on common stocks issued by a utility company. Additionally, existing and possible future regulatory","page_number":108,"box":{"x":69,"y":506,"width":777,"height":11}},{"id":"297942c6-8da9-41f9-96c3-0ae4f8d919f7","block_type":"box","text":"legislation may make it even more difficult for utilities to obtain adequate relief. Certain of the issuers of securities","page_number":108,"box":{"x":70,"y":521,"width":820,"height":11}},{"id":"72881c55-27da-49c4-8c29-333b520fec50","block_type":"box","text":"held in the Fund’s portfolio may own or operate nuclear generating facilities. Governmental authorities may from time","page_number":108,"box":{"x":69,"y":536,"width":835,"height":11}},{"id":"99ddae8f-ee99-4935-b66f-1edc1a3a0fa5","block_type":"box","text":"to time review existing policies and impose additional requirements governing the licensing, construction and","page_number":108,"box":{"x":68,"y":551,"width":778,"height":11}},{"id":"93ff6396-201f-4006-944d-95b117c42f13","block_type":"box","text":"operation of nuclear power plants. Prolonged changes in climatic conditions can also have a significant impact on","page_number":108,"box":{"x":69,"y":566,"width":808,"height":11}},{"id":"7e61a5b9-ccfc-465e-b699-b95684d95cb9","block_type":"box","text":"both the revenues of an electric and gas utility as well as the expenses of a utility, particularly a hydro-based electric","page_number":108,"box":{"x":69,"y":581,"width":831,"height":12}},{"id":"a1bd9bae-99ff-44f6-aa47-d37d591dd364","block_type":"box","text":"utility.","page_number":108,"box":{"x":69,"y":597,"width":39,"height":11}},{"id":"7edfbe9c-5317-4bf2-95fc-9d571fcf1b78","block_type":"box","text":"Companies in the utilities sector may be adversely affected by changes in exchange rates, domestic and","page_number":108,"box":{"x":102,"y":619,"width":744,"height":11}},{"id":"578ab32b-8fe9-4520-8a0b-ff7924a351fd","block_type":"box","text":"international competition, and governmental limitations on rates charged to customers. The value of regulated utility","page_number":108,"box":{"x":70,"y":634,"width":828,"height":12}},{"id":"fe59511d-0d57-4c5f-99fb-ca21cc67d285","block_type":"box","text":"debt securities and, to a lesser extent, equity securities, tends to have an inverse relationship to the movement of","page_number":108,"box":{"x":69,"y":649,"width":817,"height":12}},{"id":"b5e9061c-d754-48b9-b23c-96fc64751d3e","block_type":"box","text":"interest rates and therefore may lead to volatility in performance.","page_number":108,"box":{"x":70,"y":664,"width":464,"height":12}},{"id":"c9b37bd9-5569-47e4-9113-81751ee32755","block_type":"box","text":"Utility companies in the United States and in foreign countries are generally subject to regulation. In the United","page_number":108,"box":{"x":102,"y":687,"width":789,"height":11}},{"id":"8388ac5e-e9bd-4c05-b250-5f0cccc48b7b","block_type":"box","text":"States, most utility companies are regulated by state and/or federal authorities. Such regulation is intended to","page_number":108,"box":{"x":69,"y":702,"width":790,"height":12}},{"id":"a02b7abb-a644-4a40-8672-fba516f0766e","block_type":"box","text":"ensure appropriate standards of service and adequate capacity to meet public demand. Generally, prices are also","page_number":108,"box":{"x":69,"y":717,"width":811,"height":12}},{"id":"beef6e1d-1670-4d18-b55c-4939d94294c3","block_type":"box","text":"regulated in the United States and in foreign countries with the intention of protecting the public while ensuring that","page_number":108,"box":{"x":69,"y":732,"width":824,"height":12}},{"id":"015ec63b-e41e-494b-875b-d56f7d7d95d9","block_type":"box","text":"the rate of return earned by utility companies is sufficient to allow them to attract capital in order to grow and","page_number":108,"box":{"x":68,"y":748,"width":781,"height":11}},{"id":"1c394823-8359-49e2-800c-2fa472db4694","block_type":"box","text":"continue to provide appropriate services. There can be no assurance that such pricing policies or rates of return will","page_number":108,"box":{"x":69,"y":763,"width":826,"height":11}},{"id":"ebbd1f9a-2434-49d0-b8c3-6079834f078b","block_type":"box","text":"continue in the future.","page_number":108,"box":{"x":69,"y":778,"width":156,"height":9}},{"id":"7c0c5053-5bb3-40e9-a6af-dea58f0f297f","block_type":"box","text":"The nature of regulation of the utility industries continues to evolve both in the United States and in foreign","page_number":108,"box":{"x":101,"y":801,"width":763,"height":11}},{"id":"d5060b11-eb48-4825-a383-b5384d18ad18","block_type":"box","text":"countries. In recent years, changes in regulation in the United States increasingly have allowed utility companies to","page_number":108,"box":{"x":69,"y":816,"width":820,"height":11}},{"id":"7ce87541-e406-429c-b787-d41efa19f295","block_type":"box","text":"provide services and products outside their traditional geographic areas and lines of business, creating new areas of","page_number":108,"box":{"x":70,"y":831,"width":834,"height":11}},{"id":"79fc40cc-f31a-4131-9d74-99902f3fc173","block_type":"box","text":"competition within the industries. In some instances, utility companies are operating on an unregulated basis.","page_number":108,"box":{"x":69,"y":846,"width":784,"height":11}},{"id":"d773c3f3-0f8d-40fe-bffb-dd7c1e89e78f","block_type":"box","text":"Because of trends toward deregulation and the evolution of independent power producers as well as new entrants to","page_number":108,"box":{"x":70,"y":861,"width":830,"height":11}},{"id":"c72ae1d0-e74a-46e7-bfb2-675a7c2f7f0c","block_type":"box","text":"the field of telecommunications, non-regulated providers of utility services have become a significant part of their","page_number":108,"box":{"x":68,"y":876,"width":809,"height":11}},{"id":"49bdb9b7-ed22-40c3-a020-021cada78127","block_type":"box","text":"respective industries. The Manager believes that the emergence of competition and deregulation will result in certain","page_number":108,"box":{"x":69,"y":891,"width":834,"height":12}},{"id":"8b5d7c5a-98aa-4c85-8b58-e165be9b4802","block_type":"box","text":"utility companies being able to earn more than their traditional regulated rates of return, while others may be forced","page_number":108,"box":{"x":69,"y":906,"width":825,"height":12}},{"id":"7a094ec6-ecfb-4d71-817a-27460adb4aa1","block_type":"box","text":"II-77","page_number":108,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"2e49a0bd-d2e0-47cb-b9b4-3e560d413cb3","block_type":"box","text":"NM0926U-5977317-108/232","page_number":108,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"13f24da4-4764-41b6-99f6-43449074ef69","block_type":"box","text":"to defend their core business from increased competition and may be less profitable. Reduced profitability, as well as","page_number":109,"box":{"x":68,"y":45,"width":840,"height":11}},{"id":"9a8cf2aa-1064-4b6a-91dc-1770aec6760d","block_type":"box","text":"new uses of funds (such as for expansion, operations or stock buybacks) could result in cuts in dividend payout","page_number":109,"box":{"x":69,"y":60,"width":796,"height":11}},{"id":"0661ba03-6241-41ac-8f51-be876ddddd21","block_type":"box","text":"rates. As deregulation allows utility companies to diversify outside of their original geographic regions and their","page_number":109,"box":{"x":69,"y":75,"width":790,"height":11}},{"id":"bfa3f63b-cc9d-4ffe-bea1-40c2a2863081","block_type":"box","text":"traditional lines of business, utility companies may engage in riskier ventures. Therefore, deregulation may eliminate","page_number":109,"box":{"x":68,"y":90,"width":831,"height":11}},{"id":"02b75a7b-bc61-46bc-a2c6-c6c9b58a3f9a","block_type":"box","text":"restrictions on the maximum level of profits of certain utility companies, but may also subject these companies to","page_number":109,"box":{"x":69,"y":105,"width":812,"height":11}},{"id":"3102331e-319b-4b42-bda0-599244d88fc5","block_type":"box","text":"greater risk of loss. The Manager seeks to take advantage of favorable investment opportunities that may arise from","page_number":109,"box":{"x":68,"y":120,"width":833,"height":12}},{"id":"d3ecdca2-517c-419c-8df0-80b30fe328aa","block_type":"box","text":"these structural changes. Of course, there can be no assurance that favorable developments will occur in the future.","page_number":109,"box":{"x":68,"y":135,"width":831,"height":12}},{"id":"f0ea5e07-2ebe-469e-8854-eadadbe3fc86","block_type":"box","text":"Foreign utility companies are also subject to regulation, although such regulations may or may not be","page_number":109,"box":{"x":102,"y":158,"width":720,"height":11}},{"id":"46719fcf-6b2c-4bd7-ae3f-afa178a3b895","block_type":"box","text":"comparable to those in the United States. Foreign utility companies may be more heavily regulated by their respective","page_number":109,"box":{"x":69,"y":173,"width":838,"height":11}},{"id":"12f5dae3-f591-43af-a84e-cb2da465d0b6","block_type":"box","text":"governments than utilities in the United States and, as in the United States, generally are required to seek","page_number":109,"box":{"x":68,"y":188,"width":762,"height":12}},{"id":"d2dd0397-447f-4776-b369-edd2d36e893c","block_type":"box","text":"government approval for rate increases. In addition, many foreign utilities use fuels that may cause more pollution","page_number":109,"box":{"x":68,"y":203,"width":815,"height":12}},{"id":"5b61988f-a3b2-48ad-89e6-56e0f0261ce1","block_type":"box","text":"than those used in the United States, which may require such utilities to invest in pollution control equipment to","page_number":109,"box":{"x":68,"y":219,"width":801,"height":11}},{"id":"766a6097-ce19-43a6-b554-b3ea5058759e","block_type":"box","text":"meet any proposed pollution restrictions. Foreign regulatory systems vary from country to country and may evolve in","page_number":109,"box":{"x":69,"y":234,"width":828,"height":11}},{"id":"8b9f70a7-3359-494e-8686-06cfc46c4881","block_type":"box","text":"ways different from regulation in the United States.","page_number":109,"box":{"x":68,"y":249,"width":365,"height":11}},{"id":"57f48cda-48f3-4dc2-8bfa-61c35d791e10","block_type":"box","text":"A Fund’s investment policies are designed to enable it to capitalize on evolving investment opportunities","page_number":109,"box":{"x":101,"y":272,"width":745,"height":11}},{"id":"45e262e3-3776-47f5-aa26-ab015deea467","block_type":"box","text":"throughout the world. For example, the rapid growth of certain foreign economies will necessitate expansion of","page_number":109,"box":{"x":68,"y":286,"width":790,"height":12}},{"id":"2f27cb30-35e0-406b-82a3-0e3e57bdf1a3","block_type":"box","text":"capacity in the utility industries in those countries. Although many foreign utility companies currently are government","page_number":109,"box":{"x":69,"y":302,"width":833,"height":11}},{"id":"a5d4b147-676c-4b68-b8f6-4e0a4cde7670","block_type":"box","text":"owned, thereby limiting current investment opportunities for a Fund, the Manager believes that, in order to attract","page_number":109,"box":{"x":69,"y":317,"width":810,"height":11}},{"id":"edccbe32-861a-401a-b636-e5f72c3ceb08","block_type":"box","text":"significant capital for growth, foreign governments are likely to seek global investors through the privatization of their","page_number":109,"box":{"x":69,"y":332,"width":831,"height":11}},{"id":"d267be48-4d77-41f8-af96-c6d87dec499f","block_type":"box","text":"utility industries. Privatization, which refers to the trend toward investor ownership of assets rather than government","page_number":109,"box":{"x":69,"y":347,"width":828,"height":11}},{"id":"7e7b6f5a-38cd-4147-b845-6f18e9b613b6","block_type":"box","text":"ownership, is expected to occur in newer, faster-growing economies and in mature economies. Of course, there is no","page_number":109,"box":{"x":69,"y":362,"width":832,"height":11}},{"id":"66be5ed6-cc35-437a-94b3-40c3b0b159c6","block_type":"box","text":"assurance that such favorable developments will occur or that investment opportunities in foreign markets will","page_number":109,"box":{"x":69,"y":377,"width":786,"height":12}},{"id":"f7f1a15f-e81b-4ad0-b55d-7ee8d0523ac7","block_type":"box","text":"increase.","page_number":109,"box":{"x":70,"y":393,"width":63,"height":8}},{"id":"a556b636-f1b2-4bdc-9fe9-1d9e2505ed62","block_type":"box","text":"The revenues of domestic and foreign utility companies generally reflect the economic growth and development","page_number":109,"box":{"x":101,"y":415,"width":793,"height":11}},{"id":"99fa5abf-5a2f-432e-839d-32d52e1571bb","block_type":"box","text":"in the geographic areas in which they do business. The Manager will take into account anticipated economic growth","page_number":109,"box":{"x":70,"y":430,"width":821,"height":11}},{"id":"ff080cfe-70f4-40b3-8e9d-ab5f73348f8c","block_type":"box","text":"rates and other economic developments when selecting securities of utility companies.","page_number":109,"box":{"x":69,"y":445,"width":619,"height":12}},{"id":"42568d17-546f-4890-a5ea-fe32cc73422b","block_type":"box","text":"Electric.","page_number":109,"box":{"x":102,"y":468,"width":54,"height":9}},{"id":"74282c0c-baf8-4e85-8c95-2723fb770acb","block_type":"box","text":"The electric utility industry consists of companies that are engaged principally in the generation,","page_number":109,"box":{"x":163,"y":468,"width":684,"height":11}},{"id":"d42fc4c7-e2c0-4442-bcd3-17776ef78eb2","block_type":"box","text":"transmission and sale of electric energy, although many also provide other energy-related services. In the past,","page_number":109,"box":{"x":68,"y":483,"width":793,"height":11}},{"id":"68711211-7d3a-45ac-ba53-6d192f117f34","block_type":"box","text":"electric utility companies, in general, have been favorably affected by lower fuel and financing costs and the full or","page_number":109,"box":{"x":69,"y":498,"width":814,"height":11}},{"id":"2cc159f3-9943-4c60-944b-9ab381483918","block_type":"box","text":"near completion of major construction programs. In addition, many of these companies have generated cash flows in","page_number":109,"box":{"x":69,"y":513,"width":833,"height":12}},{"id":"5295fff0-6c47-4052-b2fb-24280c0290d0","block_type":"box","text":"excess of current operating expenses and construction expenditures, permitting some degree of diversification into","page_number":109,"box":{"x":69,"y":528,"width":821,"height":12}},{"id":"62908f93-22e7-4837-a0ac-b966c3339da0","block_type":"box","text":"unregulated businesses. Some electric utilities have also taken advantage of the right to sell power outside of their","page_number":109,"box":{"x":69,"y":543,"width":823,"height":12}},{"id":"54697ab2-9435-4582-85a2-4d82e9258dab","block_type":"box","text":"traditional geographic areas. Electric utility companies have historically been subject to the risks associated with","page_number":109,"box":{"x":68,"y":559,"width":803,"height":11}},{"id":"a7e6098d-5197-45fb-a959-bc5ea076e90a","block_type":"box","text":"increases in fuel and other operating costs, high interest costs on borrowings needed for capital construction","page_number":109,"box":{"x":70,"y":574,"width":778,"height":11}},{"id":"bba8c69e-2276-45a2-9ed1-b97dbca70db4","block_type":"box","text":"programs, costs associated with compliance with environmental and safety regulations and changes in the regulatory","page_number":109,"box":{"x":70,"y":589,"width":836,"height":11}},{"id":"516899d5-ee0e-428a-964e-3fce89322db2","block_type":"box","text":"climate. As interest rates declined, many utilities refinanced high cost debt and in doing so improved their fixed","page_number":109,"box":{"x":69,"y":604,"width":793,"height":11}},{"id":"448c27ea-cda1-4505-aeb2-74ff94e5576a","block_type":"box","text":"charges coverage. Regulators, however, lowered allowed rates of return as interest rates declined and thereby","page_number":109,"box":{"x":69,"y":619,"width":786,"height":11}},{"id":"8d96347b-5b8a-4890-8bb5-0be7c344b468","block_type":"box","text":"caused the benefits of the rate declines to be shared wholly or in part with customers. In a period of rising interest","page_number":109,"box":{"x":69,"y":634,"width":819,"height":12}},{"id":"7298bdc5-caf7-4f1f-8fb5-15b51ae9d345","block_type":"box","text":"rates, the allowed rates of return may not keep pace with the utilities’ increased costs. The construction and","page_number":109,"box":{"x":69,"y":649,"width":775,"height":12}},{"id":"d0ab30cf-0131-4c79-94fa-8ae13dd0399e","block_type":"box","text":"operation of nuclear power facilities are subject to strict scrutiny by, and evolving regulations of, the Nuclear","page_number":109,"box":{"x":69,"y":664,"width":770,"height":12}},{"id":"c13ee825-36cb-4489-83ca-8f41aafca19d","block_type":"box","text":"Regulatory Commission and state agencies which have comparable jurisdiction. Strict scrutiny might result in higher","page_number":109,"box":{"x":70,"y":680,"width":826,"height":11}},{"id":"85eb3e46-ed50-4656-a904-e964d9ccf400","block_type":"box","text":"operating costs and higher capital expenditures, with the risk that the regulators may disallow inclusion of these","page_number":109,"box":{"x":69,"y":695,"width":800,"height":11}},{"id":"e38bae2f-0a68-42b7-87a2-242cd13a3bab","block_type":"box","text":"costs in rate authorizations or the risk that a company may not be permitted to operate or complete construction of a","page_number":109,"box":{"x":69,"y":710,"width":836,"height":11}},{"id":"d9459933-dac1-405a-9e79-403ebc5398b1","block_type":"box","text":"facility. In addition, operators of nuclear power plants may be subject to significant costs for disposal of nuclear fuel","page_number":109,"box":{"x":68,"y":725,"width":826,"height":11}},{"id":"b58597cf-2925-4877-8783-1ab03345db78","block_type":"box","text":"and for decommissioning such plants.","page_number":109,"box":{"x":69,"y":740,"width":270,"height":11}},{"id":"2edfa341-12f2-4be2-8cc5-46380d9929f4","block_type":"box","text":"The rating agencies look closely at the business profile of utilities. Ratings for companies are expected to be","page_number":109,"box":{"x":101,"y":763,"width":776,"height":11}},{"id":"fec44865-f030-4f13-97f2-e20f43482931","block_type":"box","text":"impacted to a greater extent in the future by the division of their asset base. Electric utility companies that focus","page_number":109,"box":{"x":70,"y":778,"width":802,"height":11}},{"id":"bf2148c1-b97f-4f00-8f3a-3b05947426ea","block_type":"box","text":"more on the generation of electricity may be assigned less favorable ratings as this business is expected to be","page_number":109,"box":{"x":69,"y":793,"width":791,"height":11}},{"id":"5d07ba2d-e817-4f2c-8dce-71217b2f6837","block_type":"box","text":"competitive and the least regulated. On the other hand, companies that focus on transmission and distribution, which","page_number":109,"box":{"x":69,"y":808,"width":839,"height":11}},{"id":"78e3dd45-7d84-4829-af22-23165a432ae5","block_type":"box","text":"is expected to be the least competitive and the more regulated part of the business, may see higher ratings given the","page_number":109,"box":{"x":70,"y":823,"width":838,"height":12}},{"id":"f7f76164-a1f9-4b3a-8c71-841f2517f14d","block_type":"box","text":"greater predictability of cash flow.","page_number":109,"box":{"x":68,"y":838,"width":239,"height":12}},{"id":"676db8d3-1353-4f09-b762-2e4797bd6f6b","block_type":"box","text":"A number of states are considering or have enacted deregulation proposals. The introduction of competition into","page_number":109,"box":{"x":101,"y":861,"width":801,"height":11}},{"id":"f558db6a-26fb-4a5c-b1a4-1115b492e272","block_type":"box","text":"the industry as a result of such deregulation has at times resulted in lower revenue, lower credit ratings, increased","page_number":109,"box":{"x":68,"y":876,"width":821,"height":11}},{"id":"863151c1-a149-4d9a-ae8d-38d6d789ed85","block_type":"box","text":"default risk, and lower electric utility security prices. Such increased competition may also cause long-term contracts,","page_number":109,"box":{"x":69,"y":891,"width":835,"height":12}},{"id":"4bffc014-a15d-4bdc-a240-d31fcd29f658","block_type":"box","text":"which electric utilities previously entered into to buy power, to become “stranded assets” which have no economic","page_number":109,"box":{"x":68,"y":907,"width":815,"height":11}},{"id":"8c671a7e-0e15-4bf0-8fe7-b8b5193270dc","block_type":"box","text":"II-78","page_number":109,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"3e279d5f-2772-4a90-b0ff-6bfeec575aa4","block_type":"box","text":"NM0926U-5977317-109/232","page_number":109,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"7ccd2e43-2818-4feb-b8d0-549fc67afec5","block_type":"box","text":"value. Any loss associated with such contracts must be absorbed by ratepayers and investors. In addition, some","page_number":110,"box":{"x":68,"y":45,"width":803,"height":11}},{"id":"ffed7894-7291-4ebe-a1d1-0baf4309c962","block_type":"box","text":"electric utilities have acquired electric utilities overseas to diversify, enhance earnings and gain experience in","page_number":110,"box":{"x":69,"y":60,"width":777,"height":11}},{"id":"3715d9b6-69db-488b-8685-ecf6b9983f43","block_type":"box","text":"operating in a deregulated environment. In some instances, such acquisitions have involved significant borrowings,","page_number":110,"box":{"x":69,"y":75,"width":819,"height":11}},{"id":"ef4049ad-3b18-475f-9a2f-f01ca0d1fbdd","block_type":"box","text":"which have burdened the acquirer’s balance sheet. There is no assurance that current deregulation proposals will be","page_number":110,"box":{"x":68,"y":90,"width":835,"height":11}},{"id":"391f9e3e-e535-41ff-954a-148b7029c026","block_type":"box","text":"adopted. However, deregulation in any form could significantly impact the electric utilities industry.","page_number":110,"box":{"x":69,"y":105,"width":700,"height":11}},{"id":"1981d32b-ed78-4c11-b2f9-f0a262d437e8","block_type":"box","text":"Telecommunications.","page_number":110,"box":{"x":103,"y":128,"width":147,"height":9}},{"id":"da87f0f4-1c40-40f3-a905-ebf8c1e9dc1e","block_type":"box","text":"The telecommunications industry today includes both traditional telephone companies, with","page_number":110,"box":{"x":256,"y":128,"width":652,"height":11}},{"id":"f09cf5bd-b16b-4f33-b298-a4353d0ce414","block_type":"box","text":"a history of broad market coverage and highly regulated businesses, and cable companies, which began as small,","page_number":110,"box":{"x":69,"y":143,"width":813,"height":11}},{"id":"072ea764-f3a0-4199-beb4-7b8842c6ba18","block_type":"box","text":"lightly regulated businesses focused on limited markets. Today these two historically different businesses are","page_number":110,"box":{"x":70,"y":158,"width":782,"height":11}},{"id":"36032b98-576c-47f6-86d1-171827c387a2","block_type":"box","text":"converging in an industry that is trending toward larger, competitive national and international markets with an","page_number":110,"box":{"x":69,"y":173,"width":786,"height":11}},{"id":"7fea0739-b372-43d1-bbe8-e49605ace742","block_type":"box","text":"emphasis on deregulation. Companies that distribute telephone services and provide access to the telephone","page_number":110,"box":{"x":69,"y":188,"width":784,"height":12}},{"id":"22b77680-3a9a-454f-ba2d-95cfc6b2dfda","block_type":"box","text":"networks still comprise the greatest portion of this segment, but non-regulated activities such as wireless telephone","page_number":110,"box":{"x":69,"y":203,"width":830,"height":12}},{"id":"521fd110-ddf3-4f9f-bf58-d404d5801129","block_type":"box","text":"services, paging, data transmission and processing, equipment retailing, computer software and hardware and","page_number":110,"box":{"x":69,"y":218,"width":790,"height":12}},{"id":"9fd6b57b-4eee-4d96-afce-1d1389233729","block_type":"box","text":"internet services are becoming increasingly significant components as well. In particular, wireless and internet","page_number":110,"box":{"x":70,"y":234,"width":788,"height":11}},{"id":"4f80b786-7783-464d-9201-6569b665c974","block_type":"box","text":"telephone services continue to gain market share at the expense of traditional telephone companies. The presence","page_number":110,"box":{"x":68,"y":249,"width":825,"height":11}},{"id":"b5b3eb80-b3b1-45e6-aa41-e05cbe3d819e","block_type":"box","text":"of unregulated companies in this industry and the entry of traditional telephone companies into unregulated or less","page_number":110,"box":{"x":69,"y":264,"width":823,"height":11}},{"id":"a76ea47a-66b6-4c2f-9548-1f88313a3bed","block_type":"box","text":"regulated businesses provide significant investment opportunities with companies that may increase their earnings","page_number":110,"box":{"x":69,"y":279,"width":821,"height":11}},{"id":"0db33ef6-3759-430c-90bd-439ddc730588","block_type":"box","text":"at faster rates than had been allowed in traditional regulated businesses. Still, increasing competition, technological","page_number":110,"box":{"x":69,"y":294,"width":830,"height":11}},{"id":"b3462de1-d747-4321-a59b-3f9ab9c9b5b3","block_type":"box","text":"innovations and other structural changes could adversely affect the profitability of such utilities and the growth rate","page_number":110,"box":{"x":70,"y":309,"width":821,"height":11}},{"id":"108656ed-d96e-4bd1-b7db-b9393093a4e2","block_type":"box","text":"of their dividends. Given mergers and proposed legislation and enforcement changes, it is likely that both traditional","page_number":110,"box":{"x":69,"y":324,"width":827,"height":12}},{"id":"7a9be972-b72a-449b-bd62-f4a1b3f9def4","block_type":"box","text":"telephone companies and cable companies will continue to provide an expanding range of utility services to both","page_number":110,"box":{"x":68,"y":339,"width":804,"height":12}},{"id":"58a77693-401d-418b-8d47-44986c1e782a","block_type":"box","text":"residential, corporate and governmental customers.","page_number":110,"box":{"x":69,"y":355,"width":367,"height":11}},{"id":"b380176b-1f23-4a1a-a850-1b853dc11257","block_type":"box","text":"Gas.","page_number":110,"box":{"x":102,"y":377,"width":31,"height":9}},{"id":"38e8d2d1-ebb7-4cef-8ca5-e03a26c0ed9a","block_type":"box","text":"Gas transmission companies and gas distribution companies are undergoing significant changes. In the","page_number":110,"box":{"x":139,"y":377,"width":740,"height":12}},{"id":"54af2100-7b5a-456b-9582-aa262be74012","block_type":"box","text":"United States, interstate transmission companies are regulated by the Federal Energy Regulatory Commission, which","page_number":110,"box":{"x":70,"y":392,"width":834,"height":12}},{"id":"6c34574c-a1d6-42af-a19b-503bf47fd8e4","block_type":"box","text":"is reducing its regulation of the industry. Many companies have diversified into oil and gas exploration and","page_number":110,"box":{"x":70,"y":407,"width":756,"height":12}},{"id":"388b403a-ef44-47b0-b77f-f9358986367a","block_type":"box","text":"development, making returns more sensitive to energy prices. In the recent decade, gas utility companies have been","page_number":110,"box":{"x":69,"y":423,"width":831,"height":11}},{"id":"c6d8c098-e68f-47fb-be43-24b1da794407","block_type":"box","text":"adversely affected by disruptions in the oil industry and have also been affected by increased concentration and","page_number":110,"box":{"x":69,"y":438,"width":801,"height":11}},{"id":"246295c1-1c75-4fdd-aaa6-a140cd3e1af7","block_type":"box","text":"competition. In the opinion of the Manager, however, environmental considerations could improve the gas industry","page_number":110,"box":{"x":69,"y":453,"width":815,"height":11}},{"id":"14166807-a466-4c77-9bb5-e518cf165295","block_type":"box","text":"outlook in the future. For example, natural gas is the cleanest of the hydrocarbon fuels, and this may result in","page_number":110,"box":{"x":69,"y":468,"width":782,"height":11}},{"id":"58fe76d8-40bb-4094-acf3-f3ae3695c978","block_type":"box","text":"incremental shifts in fuel consumption toward natural gas and away from oil and coal, even for electricity generation.","page_number":110,"box":{"x":70,"y":483,"width":829,"height":11}},{"id":"0f87af54-daa4-486c-9dd0-70cf27fb35bd","block_type":"box","text":"However, technological or regulatory changes within the industry may delay or prevent this result.","page_number":110,"box":{"x":70,"y":498,"width":691,"height":11}},{"id":"cefdf98d-dc50-41c2-a66d-a183d5e6037f","block_type":"box","text":"Water.","page_number":110,"box":{"x":103,"y":521,"width":42,"height":9}},{"id":"a3342911-7f4c-49d2-ae07-6a4acbb41d31","block_type":"box","text":"Water supply utilities are companies that collect, purify, distribute and sell water. In the United States and","page_number":110,"box":{"x":151,"y":521,"width":754,"height":11}},{"id":"7ab8165e-c8ef-492b-9947-5521432f85eb","block_type":"box","text":"around the world the industry is highly fragmented because most of the supplies are owned by local authorities.","page_number":110,"box":{"x":69,"y":536,"width":796,"height":11}},{"id":"7165420a-2397-44fa-86ef-8f86bec81d78","block_type":"box","text":"Companies in this industry are generally mature and are experiencing little or no per capita volume growth. In the","page_number":110,"box":{"x":69,"y":551,"width":806,"height":11}},{"id":"76010faa-57f8-4cc0-bc8e-8bdd05785922","block_type":"box","text":"opinion of the Manager, there may be opportunities for certain companies to acquire other water utility companies","page_number":110,"box":{"x":69,"y":566,"width":814,"height":11}},{"id":"4d90a816-e857-4ef8-b6c5-f77f3afc2f7f","block_type":"box","text":"and for foreign acquisition of domestic companies. The Manager believes that favorable investment opportunities","page_number":110,"box":{"x":69,"y":581,"width":808,"height":12}},{"id":"2b4daae1-41c1-49fa-b474-0b4573f49db4","block_type":"box","text":"may result from consolidation of this segment. As with other utilities, however, increased regulation, increased costs","page_number":110,"box":{"x":69,"y":596,"width":832,"height":12}},{"id":"3590d8ad-24ef-40aa-98bd-f9cd42082949","block_type":"box","text":"and potential disruptions in supply may adversely affect investments in water supply utilities.","page_number":110,"box":{"x":69,"y":612,"width":662,"height":11}},{"id":"b30eb10c-d7a0-4695-9439-507c702a5f49","block_type":"box","text":"Utility Industries Generally.","page_number":110,"box":{"x":103,"y":634,"width":186,"height":11}},{"id":"863ffd7c-0e17-44d2-8166-689bb7bf447a","block_type":"box","text":"There can be no assurance that the positive developments noted above, including","page_number":110,"box":{"x":296,"y":634,"width":584,"height":12}},{"id":"27a995a8-a22b-4d1d-b3fa-195d2bf91bd7","block_type":"box","text":"those relating to privatization and changing regulation, will occur or that risk factors other than those noted above will","page_number":110,"box":{"x":68,"y":649,"width":837,"height":12}},{"id":"7261b35e-b0d2-4bde-b9d7-5cbe768072ef","block_type":"box","text":"not develop in the future.","page_number":110,"box":{"x":69,"y":664,"width":178,"height":11}},{"id":"dd883d5c-d18b-4c86-9aee-15f028dcb255","block_type":"box","text":"When-Issued Securities, Delayed Delivery Securities and Forward Commitments.","page_number":110,"box":{"x":103,"y":687,"width":585,"height":11}},{"id":"bd68282d-4065-4c84-aabb-d283467b5cd5","block_type":"box","text":"A Fund may purchase or sell","page_number":110,"box":{"x":694,"y":687,"width":200,"height":11}},{"id":"1d5df2f9-4c3a-4fda-a36e-233efc63aa3c","block_type":"box","text":"securities that it is entitled to receive on a when-issued basis. A Fund may also purchase or sell securities on a","page_number":110,"box":{"x":69,"y":703,"width":795,"height":10}},{"id":"c325f118-9477-406b-902c-2f8d885eb635","block_type":"box","text":"delayed delivery basis or through a forward commitment (including on a TBA (to be announced) basis). These","page_number":110,"box":{"x":69,"y":717,"width":777,"height":12}},{"id":"725fac49-0794-4851-8b19-688638dc1fc5","block_type":"box","text":"transactions involve the purchase or sale of securities by a Fund at an established price with payment and delivery","page_number":110,"box":{"x":68,"y":732,"width":820,"height":12}},{"id":"9f1f1dcf-79ab-43cb-91ce-bd18796938db","block_type":"box","text":"taking place in the future. The Fund enters into these transactions to obtain what is considered an advantageous","page_number":110,"box":{"x":68,"y":748,"width":807,"height":11}},{"id":"ad90b89d-5426-46d4-ba3a-805f49a75673","block_type":"box","text":"price to the Fund at the time of entering into the transaction.","page_number":110,"box":{"x":70,"y":763,"width":430,"height":11}},{"id":"aa7dd8b8-a4d2-42fc-afac-893a4eb911c4","block_type":"box","text":"Pursuant to recommendations of the Treasury Market Practices Group, which is sponsored by the Federal","page_number":110,"box":{"x":102,"y":785,"width":750,"height":12}},{"id":"17d752a9-9ec4-4a3c-a5b8-02e90e3be9dc","block_type":"box","text":"Reserve Bank of New York, a Fund or its counterparty generally will be required to post collateral when entering into","page_number":110,"box":{"x":70,"y":801,"width":823,"height":11}},{"id":"779b8777-d7ad-45c6-b283-bad8bc02211c","block_type":"box","text":"certain forward-settling transactions, including without limitation TBA transactions. FINRA rules have also been","page_number":110,"box":{"x":69,"y":816,"width":788,"height":11}},{"id":"a4b01404-6e2f-4bec-80f4-9a250dea3b1b","block_type":"box","text":"implemented that include mandatory margin requirements for the TBA market with limited exceptions. The","page_number":110,"box":{"x":70,"y":831,"width":755,"height":11}},{"id":"4e6b1fd4-6fec-4522-bbc5-83923e4c06a1","block_type":"box","text":"collateralization of TBA trades is intended to mitigate counterparty credit risk between trade and settlement, but","page_number":110,"box":{"x":69,"y":846,"width":799,"height":11}},{"id":"e01f8345-5b6d-4ebc-8ea4-5d98e7538dee","block_type":"box","text":"could increase the cost of TBA transactions and impose added operational complexity.","page_number":110,"box":{"x":69,"y":861,"width":614,"height":11}},{"id":"8678d65f-b52b-4643-ac53-7b6b6e8e05e1","block_type":"box","text":"There can be no assurance that a security purchased on a when-issued basis will be issued or that a security","page_number":110,"box":{"x":101,"y":884,"width":780,"height":11}},{"id":"f1b94d15-9de9-42a0-b2e3-a533b73674d2","block_type":"box","text":"purchased or sold on a delayed delivery basis or through a forward commitment will be delivered. Also, the value of","page_number":110,"box":{"x":70,"y":899,"width":823,"height":11}},{"id":"23ed8e07-30a2-41ad-a758-c36b48202602","block_type":"box","text":"II-79","page_number":110,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"7e39a4ca-6ac2-4b85-a66e-b0919d79e317","block_type":"box","text":"NM0926U-5977317-110/232","page_number":110,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"b0e370fb-c662-4956-baff-6aaeab958e56","block_type":"box","text":"securities in these transactions on the delivery date may be more or less than the price paid by the Fund to purchase","page_number":111,"box":{"x":69,"y":45,"width":838,"height":11}},{"id":"8f197922-34a2-4a57-80bd-b242e3a178e0","block_type":"box","text":"the securities. The Fund will lose money if the value of the security in such a transaction declines below the purchase","page_number":111,"box":{"x":68,"y":60,"width":839,"height":11}},{"id":"9400e899-c24e-4480-91d4-a7ae34e0f592","block_type":"box","text":"price and will not benefit if the value of the security appreciates above the sale price during the commitment period.","page_number":111,"box":{"x":70,"y":75,"width":824,"height":11}},{"id":"577ca9c7-d3a3-448b-9ae7-50c6563b0c67","block_type":"box","text":"If deemed advisable as a matter of investment strategy, a Fund may dispose of or renegotiate a commitment","page_number":111,"box":{"x":102,"y":98,"width":776,"height":11}},{"id":"c04708ec-f98d-4d9e-866f-079abff872a6","block_type":"box","text":"after it has been entered into, and may sell securities it has committed to purchase before those securities are","page_number":111,"box":{"x":69,"y":113,"width":795,"height":11}},{"id":"578edeff-de5c-4729-9c84-53467fba67ce","block_type":"box","text":"delivered to the Fund on the settlement date. In these cases the Fund may realize a taxable capital gain or loss.","page_number":111,"box":{"x":69,"y":128,"width":799,"height":11}},{"id":"aca31c94-a8b1-45a6-a101-58af064d6a23","block_type":"box","text":"When a Fund engages in when-issued, TBA or forward commitment transactions, it relies on the other party to","page_number":111,"box":{"x":101,"y":150,"width":784,"height":12}},{"id":"debe68c5-68ae-4bb9-ae97-18cfab5d60a1","block_type":"box","text":"consummate the trade. Failure of such party to do so may result in the Fund’s incurring a loss or missing an","page_number":111,"box":{"x":69,"y":166,"width":772,"height":11}},{"id":"f698a27d-e044-42f5-8a9f-c32b83bdcdff","block_type":"box","text":"opportunity to obtain a price considered to be advantageous.","page_number":111,"box":{"x":69,"y":181,"width":434,"height":11}},{"id":"858a4064-2c22-43a7-8737-b8a7476f468c","block_type":"box","text":"The market value of the securities underlying a commitment to purchase securities, and any subsequent","page_number":111,"box":{"x":101,"y":203,"width":745,"height":12}},{"id":"d89c67e2-0f67-476c-8d6a-adb8cfd82db0","block_type":"box","text":"fluctuations in their market value, is taken into account when determining the market value of a Fund starting on the","page_number":111,"box":{"x":68,"y":218,"width":831,"height":12}},{"id":"347678f9-ff21-469f-8c90-60510a1b7067","block_type":"box","text":"day the Fund agrees to purchase the securities. The Fund does not earn interest on the securities it has committed","page_number":111,"box":{"x":69,"y":234,"width":823,"height":11}},{"id":"f5c2e2dc-8b8f-49de-a320-df6ee53e7f84","block_type":"box","text":"to purchase until they are paid for and delivered on the settlement date.","page_number":111,"box":{"x":68,"y":249,"width":514,"height":11}},{"id":"6a9ef98d-25f3-42bb-b5d0-4b465ee76043","block_type":"box","text":"Rule 18f-4 under the Investment Company Act permits a Fund to enter into when-issued or forward-settling","page_number":111,"box":{"x":102,"y":271,"width":759,"height":12}},{"id":"fcc3cb6d-b1a2-461d-8dca-ee487eac9b34","block_type":"box","text":"securities (","page_number":111,"box":{"x":69,"y":287,"width":78,"height":11}},{"id":"0050f075-3fbb-4932-94c5-833cafc1308c","block_type":"box","text":"e.g.","page_number":111,"box":{"x":148,"y":288,"width":25,"height":10}},{"id":"46a05fba-c0c3-49b3-b037-a7437502c7c6","block_type":"box","text":", firm and standby commitments, including TBA commitments, and dollar rolls) and non-standard","page_number":111,"box":{"x":176,"y":286,"width":686,"height":12}},{"id":"d5f2e9e8-22aa-4bfe-b118-c6dfa16e28f6","block_type":"box","text":"settlement cycle securities notwithstanding the limitation on the issuance of senior securities in Section 18 of the","page_number":111,"box":{"x":69,"y":302,"width":813,"height":11}},{"id":"c7fd7d07-ea43-44c4-bf2d-856945aeda34","block_type":"box","text":"Investment Company Act, provided that the Fund intends to physically settle the transaction and the transaction will","page_number":111,"box":{"x":70,"y":317,"width":822,"height":11}},{"id":"d0aca0c7-f06e-4dce-9562-241aa9cf9a12","block_type":"box","text":"settle within 35 days of its trade date (the “Delayed-Settlement Securities Provision”). If a when-issued, forward","page_number":111,"box":{"x":69,"y":332,"width":802,"height":11}},{"id":"a06d5287-e66f-47c7-b751-5be782d8debe","block_type":"box","text":"settling or non-standard settlement cycle security does not satisfy the Delayed-Settlement Securities Provision, then","page_number":111,"box":{"x":69,"y":347,"width":826,"height":11}},{"id":"cb000e39-a198-41a5-aa52-33c5c8ace042","block_type":"box","text":"it is treated as a Derivatives Transaction under Rule 18f-4. See “—Derivatives — Regulation of Derivatives — Rule","page_number":111,"box":{"x":70,"y":362,"width":816,"height":11}},{"id":"704248a3-40e6-42d6-85d0-8c18de43fca2","block_type":"box","text":"18f-4 under the Investment Company Act” above.","page_number":111,"box":{"x":70,"y":377,"width":349,"height":11}},{"id":"39455696-4c86-49df-b55a-412a91d9af8c","block_type":"box","text":"Regulations adopted by global prudential regulators require certain bank-regulated counterparties and certain of","page_number":111,"box":{"x":102,"y":400,"width":800,"height":11}},{"id":"252b319e-d098-488c-b1a1-ce06b1236495","block_type":"box","text":"their affiliates to include in certain financial contracts, including many agreements with respect to when-issued, TBA","page_number":111,"box":{"x":68,"y":415,"width":829,"height":11}},{"id":"343360cd-4c90-4853-86d6-417c036fc21c","block_type":"box","text":"and forward commitment transactions, terms that delay or restrict the rights of counterparties, such as a Fund, to","page_number":111,"box":{"x":69,"y":430,"width":814,"height":11}},{"id":"50268471-515c-4c9b-9faf-b41b7ea74af5","block_type":"box","text":"terminate such agreements, foreclose upon collateral, exercise other default rights or restrict transfers of credit","page_number":111,"box":{"x":68,"y":445,"width":799,"height":12}},{"id":"03177a4a-ff41-4d23-bdc6-eed23ac2bd77","block_type":"box","text":"support in the event that the counterparty and/or its affiliates are subject to certain types of resolution or insolvency","page_number":111,"box":{"x":69,"y":460,"width":836,"height":12}},{"id":"2c9833d9-6fb3-4113-85e4-1d9ca7c24ebd","block_type":"box","text":"proceedings. It is possible that these requirements, as well as potential additional government regulation and other","page_number":111,"box":{"x":70,"y":476,"width":824,"height":11}},{"id":"3743e540-af59-4c70-8390-b53ad98cb908","block_type":"box","text":"developments in the market, could adversely affect a Fund’s ability to terminate existing agreements with respect to","page_number":111,"box":{"x":69,"y":491,"width":829,"height":11}},{"id":"4bac32ff-8b35-43f9-96b0-603b5bc6ca5a","block_type":"box","text":"these transactions or to realize amounts to be received under such agreements.","page_number":111,"box":{"x":68,"y":506,"width":573,"height":11}},{"id":"593034bc-78c3-46ea-8521-35d516df44ef","block_type":"box","text":"Yields and Ratings.","page_number":111,"box":{"x":103,"y":529,"width":139,"height":11}},{"id":"d2dfb1b4-a7b5-4e4d-a9ae-d38a30414a5e","block_type":"box","text":"The yields on certain obligations are dependent on a variety of factors, including general","page_number":111,"box":{"x":247,"y":528,"width":628,"height":12}},{"id":"5cddf5f3-b803-4db5-9127-0c1a5effdf20","block_type":"box","text":"market conditions, conditions in the particular market for the obligation, the financial condition of the issuer, the size","page_number":111,"box":{"x":69,"y":543,"width":834,"height":12}},{"id":"9fdb4950-f5e6-460a-966b-c508d6168891","block_type":"box","text":"of the offering, the maturity of the obligation and the ratings of the issue. The ratings of Moody’s, Fitch and S&P","page_number":111,"box":{"x":69,"y":559,"width":799,"height":11}},{"id":"f6c82076-a57e-436b-8edd-288e135b8a9e","block_type":"box","text":"represent their respective opinions as to the quality of the obligations they undertake to rate. Ratings, however, are","page_number":111,"box":{"x":69,"y":574,"width":824,"height":11}},{"id":"1a168995-9c48-41bd-af9d-94138e114663","block_type":"box","text":"general and are not absolute standards of quality. Consequently, obligations with the same rating, maturity and","page_number":111,"box":{"x":68,"y":589,"width":792,"height":11}},{"id":"14b2835a-d4a5-4984-a97a-a0a7adb1383d","block_type":"box","text":"interest rate may have different market prices. Subsequent to its purchase by a Fund, a rated security may cease to","page_number":111,"box":{"x":70,"y":604,"width":827,"height":11}},{"id":"6034145c-4281-4824-bd40-5df83b376fa2","block_type":"box","text":"be rated. A Fund’s Manager or sub-adviser will consider such an event in determining whether the Fund should","page_number":111,"box":{"x":69,"y":619,"width":786,"height":11}},{"id":"94a18c07-6a41-4fd9-968b-024fb36be687","block_type":"box","text":"continue to hold the security.","page_number":111,"box":{"x":69,"y":634,"width":204,"height":11}},{"id":"3fd86cd5-45be-45de-98fa-eb6c84515819","block_type":"box","text":"Zero Coupon Securities.","page_number":111,"box":{"x":102,"y":657,"width":175,"height":11}},{"id":"07162ebd-6190-4e4b-9fdd-17f6c634aec6","block_type":"box","text":"Zero coupon securities are securities that are sold at a discount to par value and do","page_number":111,"box":{"x":283,"y":657,"width":601,"height":11}},{"id":"13194534-ad48-4ba0-9de8-0d0a4431cfb5","block_type":"box","text":"not pay interest during the life of the security. The discount approximates the total amount of interest the security will","page_number":111,"box":{"x":69,"y":672,"width":837,"height":11}},{"id":"0d5017d4-e817-4b32-86ab-b76baf7331a4","block_type":"box","text":"accrue and compound over the period until maturity at a rate of interest reflecting the market rate of the security at","page_number":111,"box":{"x":69,"y":687,"width":822,"height":11}},{"id":"d4f07649-a77c-4bb4-ab0a-05890f3c8904","block_type":"box","text":"the time of issuance. Upon maturity, the holder of a zero coupon security is entitled to receive the par value of the","page_number":111,"box":{"x":68,"y":702,"width":814,"height":11}},{"id":"b8526010-c364-4667-940f-267f1ed6f023","block_type":"box","text":"security.","page_number":111,"box":{"x":69,"y":718,"width":57,"height":11}},{"id":"e66db556-8418-4349-a4df-870c9ee4010d","block_type":"box","text":"While interest payments are not made on such securities, holders of such securities are deemed to have","page_number":111,"box":{"x":101,"y":740,"width":749,"height":11}},{"id":"61e962d9-b335-4855-ac83-6db11e0c3e43","block_type":"box","text":"received income (“phantom income”) annually, notwithstanding that cash may not be received currently. The effect of","page_number":111,"box":{"x":69,"y":755,"width":835,"height":11}},{"id":"c4949551-0972-44bf-a5aa-6a2dc10f938d","block_type":"box","text":"owning instruments that do not make current interest payments is that a fixed yield is earned not only on the original","page_number":111,"box":{"x":69,"y":770,"width":833,"height":12}},{"id":"b491b279-e642-43eb-850d-33206f062b8e","block_type":"box","text":"investment but also, in effect, on all discount accretion during the life of the obligations. This implicit reinvestment of","page_number":111,"box":{"x":70,"y":785,"width":836,"height":12}},{"id":"5192efa2-10e3-402a-b218-eac5d734e005","block_type":"box","text":"earnings at a fixed rate eliminates the risk of being unable to invest distributions at a rate as high as the implicit","page_number":111,"box":{"x":69,"y":801,"width":804,"height":11}},{"id":"d119b320-e9d9-45da-b5eb-327eff56ea08","block_type":"box","text":"yield on the zero coupon bond, but at the same time eliminates the holder’s ability to reinvest at higher rates in the","page_number":111,"box":{"x":68,"y":816,"width":824,"height":11}},{"id":"64faea1c-a58f-45aa-966d-2b4f5f9d00b0","block_type":"box","text":"future. For this reason, some of these securities may be subject to substantially greater price fluctuations during","page_number":111,"box":{"x":68,"y":831,"width":805,"height":11}},{"id":"0bfe28bd-b0dd-49a3-8840-541e8b9a7502","block_type":"box","text":"periods of changing market interest rates than are comparable securities that pay interest currently. Longer term zero","page_number":111,"box":{"x":70,"y":846,"width":837,"height":11}},{"id":"7c744152-8301-4f96-8e85-8d2acb12065f","block_type":"box","text":"coupon bonds are more exposed to interest rate risk than shorter term zero coupon bonds. These investments","page_number":111,"box":{"x":69,"y":861,"width":791,"height":11}},{"id":"5408308f-1dc1-4197-b80b-18c7c48e98aa","block_type":"box","text":"benefit the issuer by mitigating its need for cash to meet debt service, but also require a higher rate of return to","page_number":111,"box":{"x":69,"y":876,"width":800,"height":11}},{"id":"41cb5a5f-9001-4e26-affc-fd0eae39d3e6","block_type":"box","text":"attract investors who are willing to defer receipt of cash.","page_number":111,"box":{"x":69,"y":891,"width":400,"height":12}},{"id":"2a1ce4b3-88d9-4579-9256-6d01c26a8bc0","block_type":"box","text":"II-80","page_number":111,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"9658a73e-5cf5-46d0-b710-fea0fffa57a0","block_type":"box","text":"NM0926U-5977317-111/232","page_number":111,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"82e90aa9-1651-4796-a5ed-43115e812b88","block_type":"box","text":"A Fund accrues income with respect to these securities for U.S. federal income tax and accounting purposes","page_number":112,"box":{"x":101,"y":45,"width":775,"height":11}},{"id":"ff13ee46-d0d6-4bce-bf28-7be46d4a9cd0","block_type":"box","text":"prior to the receipt of cash payments. Zero coupon securities may be subject to greater fluctuation in value and less","page_number":112,"box":{"x":70,"y":60,"width":827,"height":11}},{"id":"8b78a0a8-d631-4069-a545-6f5b313026c7","block_type":"box","text":"liquidity in the event of adverse market conditions than comparably rated securities that pay cash interest at regular","page_number":112,"box":{"x":70,"y":75,"width":826,"height":11}},{"id":"6533e782-9b15-408d-8c47-ae88002f56eb","block_type":"box","text":"intervals.","page_number":112,"box":{"x":70,"y":90,"width":64,"height":9}},{"id":"78b29516-936f-4cf6-90bf-90f3374b0351","block_type":"box","text":"Further, to maintain its qualification for pass-through treatment under the U.S. federal tax laws, a Fund is","page_number":112,"box":{"x":102,"y":113,"width":749,"height":11}},{"id":"b67342aa-1c2b-4537-b294-ad388716c669","block_type":"box","text":"required to distribute income to its shareholders and, consequently, may have to dispose of other, more liquid","page_number":112,"box":{"x":69,"y":128,"width":784,"height":11}},{"id":"0808238c-6371-4324-b4f4-9705fef123aa","block_type":"box","text":"portfolio securities under disadvantageous circumstances or may have to leverage itself by borrowing in order to","page_number":112,"box":{"x":70,"y":143,"width":799,"height":11}},{"id":"b778bcae-2ea9-41d5-ad3f-a4b1f13f04bf","block_type":"box","text":"generate the cash to satisfy these distributions. The required distributions may result in an increase in a Fund’s","page_number":112,"box":{"x":68,"y":158,"width":799,"height":11}},{"id":"775946c1-39d9-4d27-8ac7-0bf68ae53f94","block_type":"box","text":"exposure to zero coupon securities.","page_number":112,"box":{"x":69,"y":173,"width":253,"height":11}},{"id":"00f63c1c-076b-4337-87d9-56ed2c9d2661","block_type":"box","text":"In addition to the above-described risks, there are certain other risks related to investing in zero coupon","page_number":112,"box":{"x":102,"y":196,"width":740,"height":11}},{"id":"e1e17211-7068-44a9-ae01-876523b5cc8d","block_type":"box","text":"securities. During a period of severe market conditions, the market for such securities may become even less liquid.","page_number":112,"box":{"x":69,"y":211,"width":829,"height":11}},{"id":"3ec40835-44a5-4f8e-b620-fcaa9188a08b","block_type":"box","text":"In addition, as these securities do not pay cash interest, a Fund’s investment exposure to these securities and their","page_number":112,"box":{"x":70,"y":226,"width":829,"height":11}},{"id":"9131bd72-de9f-4f45-b3c1-5ff4e0fb7d88","block_type":"box","text":"risks, including credit risk, will increase during the time these securities are held in the Fund’s portfolio.","page_number":112,"box":{"x":69,"y":241,"width":741,"height":11}},{"id":"e21cacdc-9ab6-4ad0-a21f-860c7a5f0fbe","block_type":"box","text":"Suitability. (All Funds)","page_number":112,"box":{"x":101,"y":264,"width":161,"height":11}},{"id":"55dab4cd-c8f6-481a-a258-d8e2410f50e5","block_type":"box","text":"The economic benefit of an investment in any Fund depends upon many factors beyond the control of the Fund,","page_number":112,"box":{"x":101,"y":286,"width":793,"height":12}},{"id":"176f8955-0df4-4e39-9950-a652c55325b0","block_type":"box","text":"the Manager and its affiliates. Each Fund should be considered a vehicle for diversification and not as a balanced","page_number":112,"box":{"x":68,"y":302,"width":811,"height":11}},{"id":"fdb7fe1c-4194-401c-a1b3-e9e87ec8661c","block_type":"box","text":"investment program. The suitability for any particular investor of a purchase of shares in a Fund will depend upon,","page_number":112,"box":{"x":70,"y":317,"width":810,"height":11}},{"id":"b33a59eb-fcf2-4cac-8475-21f957c1c3e3","block_type":"box","text":"among other things, such investor’s investment objectives and such investor’s ability to accept the risks associated","page_number":112,"box":{"x":69,"y":332,"width":826,"height":11}},{"id":"b2c73593-1f2b-4155-863b-a685cb3a6ba1","block_type":"box","text":"with investing in securities, including the risk of loss of principal.","page_number":112,"box":{"x":68,"y":347,"width":460,"height":11}},{"id":"a1e98b47-a3ef-4244-8301-a4278214ec22","block_type":"box","text":"Investment Restrictions. (All Funds)","page_number":112,"box":{"x":102,"y":370,"width":264,"height":11}},{"id":"c4e40a34-ad5f-4b73-bb84-88f38bb6dd59","block_type":"box","text":"See “Investment Restrictions” or “Investment Policies,” as applicable in each Fund’s SAI for the specific","page_number":112,"box":{"x":102,"y":392,"width":745,"height":11}},{"id":"1a213cce-721e-48d6-b2fe-f7c0d666141c","block_type":"box","text":"fundamental and non-fundamental investment restrictions adopted by each Fund. In addition to those investment","page_number":112,"box":{"x":68,"y":407,"width":807,"height":12}},{"id":"55240c82-6073-4433-983d-12630afa3fb6","block_type":"box","text":"restrictions, each Fund is also subject to the restrictions discussed below.","page_number":112,"box":{"x":69,"y":423,"width":528,"height":11}},{"id":"a24495c2-f8e1-4dff-bd58-6a6938357883","block_type":"box","text":"Each Fund’s investments will be limited in order to allow the Fund to qualify as a “regulated investment","page_number":112,"box":{"x":102,"y":445,"width":735,"height":12}},{"id":"eb1c4278-5477-4c87-9cab-2fecde3f7dc2","block_type":"box","text":"company” for purposes of the Code. See “Dividends and Taxes — Taxes” or “Taxes.” To qualify, among other","page_number":112,"box":{"x":69,"y":460,"width":775,"height":12}},{"id":"e17641ca-a9bc-4a70-a1d3-1ceba2984d89","block_type":"box","text":"requirements, each Fund will limit its investments so that, at the close of each quarter of the taxable year, (i) at least","page_number":112,"box":{"x":69,"y":475,"width":837,"height":12}},{"id":"b8d7e9dc-b316-4b03-accd-9f0309d43c86","block_type":"box","text":"50% of the market value of each Fund’s assets is represented by cash, securities of other regulated investment","page_number":112,"box":{"x":69,"y":491,"width":799,"height":11}},{"id":"dd48e718-c060-40bd-a965-a069bcd6a878","block_type":"box","text":"companies, U.S. Government Securities and other securities, with such other securities limited, in respect of any one","page_number":112,"box":{"x":69,"y":506,"width":837,"height":11}},{"id":"28ed1c7f-7270-4e58-a456-cfae9c03128d","block_type":"box","text":"issuer, to an amount not greater in value than 5% of the Fund’s assets and not greater than 10% of the outstanding","page_number":112,"box":{"x":70,"y":521,"width":825,"height":11}},{"id":"843d49b0-332a-41ff-bb8c-5b8661c2b2b5","block_type":"box","text":"voting securities of such issuer and (ii) not more than 25% of the value of its assets is invested in the securities","page_number":112,"box":{"x":68,"y":536,"width":802,"height":11}},{"id":"51f33db1-5457-4bf9-a151-a964a57f6bca","block_type":"box","text":"(other than U.S. Government Securities or securities of other regulated investment companies) of any one issuer, any","page_number":112,"box":{"x":69,"y":551,"width":837,"height":11}},{"id":"31a85c7f-5601-4777-a4ec-f1e173e21011","block_type":"box","text":"two or more issuers that the Fund controls and that are determined to be engaged in the same or similar trades or","page_number":112,"box":{"x":68,"y":566,"width":819,"height":11}},{"id":"444c3cea-f487-4ac7-95ae-1bbc5bcddf76","block_type":"box","text":"businesses or related trades or businesses or in the securities of one or more qualified publicly traded partnerships","page_number":112,"box":{"x":69,"y":581,"width":828,"height":11}},{"id":"fc7acd9f-675f-45ea-b344-dde9a34e8e05","block_type":"box","text":"(","page_number":112,"box":{"x":69,"y":597,"width":3,"height":10}},{"id":"a6d2aedb-e63e-4fdf-b613-10557320b71f","block_type":"box","text":"i.e.","page_number":112,"box":{"x":74,"y":597,"width":21,"height":8}},{"id":"b114cf7a-1197-406e-b9aa-1f95afdf7287","block_type":"box","text":", partnerships that are traded on an established securities market or tradable on a secondary market, other than","page_number":112,"box":{"x":97,"y":597,"width":806,"height":11}},{"id":"fc188de9-9d23-425e-a357-46716e270789","block_type":"box","text":"partnerships that derive 90% of their income from interest, dividends, capital gains and other traditionally permitted","page_number":112,"box":{"x":70,"y":612,"width":824,"height":11}},{"id":"15830809-9054-41e8-9fe6-90a7756e29b1","block_type":"box","text":"mutual fund income). For purposes of this restriction, the Municipal Funds generally will regard each state and each","page_number":112,"box":{"x":69,"y":627,"width":824,"height":11}},{"id":"a971d62f-a0cf-4495-8c06-3a3f4cb0f462","block_type":"box","text":"of its political subdivisions, agencies or instrumentalities and each multi-state agency of which the state is a member","page_number":112,"box":{"x":69,"y":642,"width":838,"height":11}},{"id":"48fdb3e2-4376-4dad-b3f8-f7a67eac5e2e","block_type":"box","text":"as a separate issuer. Each public authority that issues securities on behalf of a private entity generally will also be","page_number":112,"box":{"x":69,"y":657,"width":815,"height":11}},{"id":"ef7f1caa-73ef-42bb-88e5-16641197e4cf","block_type":"box","text":"regarded as a separate issuer, except that if the security is backed only by the assets and revenues of a non","page_number":112,"box":{"x":69,"y":672,"width":781,"height":11}},{"id":"717b85b2-f4a4-45a7-b915-66f9cda244ec","block_type":"box","text":"government entity, then the entity with the ultimate responsibility for the payment of interest and principal may be","page_number":112,"box":{"x":68,"y":687,"width":810,"height":11}},{"id":"92c9a6a1-9b4d-4592-80c2-8982017e7c38","block_type":"box","text":"regarded as the sole issuer.","page_number":112,"box":{"x":69,"y":703,"width":198,"height":11}},{"id":"c649b06c-787c-43ef-90b2-85fe3c6493f2","block_type":"box","text":"Foreign government securities (unlike U.S. Government Securities) are not exempt from the 5%, 10% and 25%","page_number":112,"box":{"x":102,"y":725,"width":784,"height":11}},{"id":"12c39502-6634-43b2-8362-62584533f242","block_type":"box","text":"diversification requirements of the Code discussed above and the securities of each foreign government issuer are","page_number":112,"box":{"x":69,"y":740,"width":819,"height":11}},{"id":"105c4c8b-be11-4af4-9977-a9305af12364","block_type":"box","text":"considered to be obligations of a single issuer. These tax-related limitations may be changed by the Directors of a","page_number":112,"box":{"x":69,"y":755,"width":811,"height":11}},{"id":"56b25c6d-5e67-4694-9e74-6052e760f3ba","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":112,"box":{"x":70,"y":770,"width":747,"height":12}},{"id":"75a7e415-4bbe-4053-aa77-18a80e8402e7","block_type":"box","text":"“diversified” under the Investment Company Act must satisfy the foregoing 5% and 10% requirements with respect to","page_number":112,"box":{"x":70,"y":785,"width":834,"height":12}},{"id":"3f19c25d-eec0-447e-ba76-6d45c32346a5","block_type":"box","text":"75% of its total assets.","page_number":112,"box":{"x":69,"y":801,"width":165,"height":9}},{"id":"f35a4dcc-1c2c-478f-8141-2f5e6490c802","block_type":"box","text":"II-81","page_number":112,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"804c00a3-b13c-494b-a4ba-bcb198809b84","block_type":"box","text":"NM0926U-5977317-112/232","page_number":112,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"794597d3-fa87-41df-8c43-e1828021bce5","block_type":"box","text":"MANAGEMENT AND OTHER SERVICE ARRANGEMENTS","page_number":113,"box":{"x":268,"y":45,"width":442,"height":10}},{"id":"539d2426-03c2-468f-aa03-593c12218f08","block_type":"box","text":"Directors and Officers","page_number":113,"box":{"x":69,"y":76,"width":159,"height":8}},{"id":"497d58ac-515d-46ac-9b62-66db5a01dede","block_type":"box","text":"See “Information on Directors and Officers, ‘—Biographical Information,’ ‘— Share Ownership’ and ‘—","page_number":113,"box":{"x":102,"y":98,"width":733,"height":11}},{"id":"5ecd41d3-5f25-4b63-9fb2-23d5c0e4d3cc","block_type":"box","text":"Compensation of Directors’” or “Information on Trustees and Officers, ‘—Biographical Information,’ ‘— Share","page_number":113,"box":{"x":69,"y":113,"width":783,"height":12}},{"id":"33ce0d0b-c9e2-48ce-95a3-df255d06adc3","block_type":"box","text":"Ownership’ and ‘— Compensation of Trustees’,” as applicable, in Part I of each Fund’s SAI for biographical and","page_number":113,"box":{"x":69,"y":128,"width":795,"height":12}},{"id":"10a8b83a-079a-4207-948d-7356410a9f28","block_type":"box","text":"certain other information relating to the Directors and officers of your Fund, including Directors’ compensation.","page_number":113,"box":{"x":69,"y":143,"width":789,"height":12}},{"id":"ddfa9504-f376-412e-9f9a-d3ea502c54c5","block_type":"box","text":"Management Arrangements","page_number":113,"box":{"x":69,"y":174,"width":202,"height":11}},{"id":"98b796d7-c252-4ea2-a773-57c3ee897636","block_type":"box","text":"Management Services.","page_number":113,"box":{"x":102,"y":197,"width":162,"height":11}},{"id":"dcd2f1e1-f877-40db-b563-94fc2569313e","block_type":"box","text":"The Manager provides each Fund with investment advisory and management services.","page_number":113,"box":{"x":270,"y":197,"width":615,"height":11}},{"id":"c1d6bdba-6dbb-4d75-9430-bc47cfa284e1","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":113,"box":{"x":69,"y":212,"width":836,"height":11}},{"id":"7c8fc4c3-6035-43c0-8d8d-d7a6320e24f0","block_type":"box","text":"portfolio and reviews the Fund’s holdings in light of its own research analysis and that from other relevant sources.","page_number":113,"box":{"x":70,"y":227,"width":820,"height":11}},{"id":"b8932369-738c-4d8f-9403-4d91df234374","block_type":"box","text":"The responsibility for making decisions to buy, sell or hold a particular security rests with the Manager. 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Such contract is not assignable","page_number":114,"box":{"x":70,"y":385,"width":810,"height":11}},{"id":"dc962bf8-4ad5-408e-ac8b-f55bda7f4bf6","block_type":"box","text":"and may be terminated without penalty on written notice at the option of either party thereto or by the vote of the","page_number":114,"box":{"x":69,"y":400,"width":805,"height":11}},{"id":"183f34a3-5c49-4208-947b-f1b6b645ae8b","block_type":"box","text":"shareholders of the Fund.","page_number":114,"box":{"x":69,"y":415,"width":181,"height":9}},{"id":"c85d2030-df73-4495-8ae6-6f2bd582fd2c","block_type":"box","text":"Transfer Agency Services.","page_number":114,"box":{"x":103,"y":438,"width":180,"height":11}},{"id":"df677ace-4a6b-46cd-ac46-6980d682b045","block_type":"box","text":"BNY Mellon Investment Servicing (US) Inc. (in this capacity, the “Transfer Agent”), a","page_number":114,"box":{"x":291,"y":438,"width":595,"height":11}},{"id":"47f7ea20-3d09-4018-8a8d-d5ffb64db0a6","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":114,"box":{"x":69,"y":453,"width":816,"height":11}},{"id":"03e74f6c-01a7-4364-80b3-611ebc7c8701","block_type":"box","text":"Agency, Dividend Disbursing Agency and Shareholder Servicing Agency Agreement (the “Transfer Agency Agreement”)","page_number":114,"box":{"x":68,"y":468,"width":833,"height":11}},{"id":"f7f2a1b6-4040-4190-b8dc-f2425fdc1480","block_type":"box","text":"with the Funds. 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Please see the inside back cover page of your Fund’s Prospectus and Part I","page_number":114,"box":{"x":69,"y":642,"width":823,"height":11}},{"id":"4bc46b49-850d-4ef4-b890-782db23cd252","block_type":"box","text":"of this SAI for information on your Fund’s independent registered public accounting firm.","page_number":114,"box":{"x":69,"y":657,"width":627,"height":11}},{"id":"fbfecd78-4628-4a95-828c-db231736914c","block_type":"box","text":"Custodian Services.","page_number":114,"box":{"x":102,"y":680,"width":141,"height":9}},{"id":"83b48f88-0c00-48c6-9a71-0a6c302f8936","block_type":"box","text":"The name and address of the custodian (the “Custodian”) of each Fund are provided on the","page_number":114,"box":{"x":249,"y":680,"width":654,"height":11}},{"id":"e342ff32-6444-4e5f-b588-f4869f449647","block_type":"box","text":"inside back cover page of the Fund’s Prospectus. 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The Custodian is authorized to establish separate accounts in foreign currencies and to","page_number":114,"box":{"x":68,"y":725,"width":802,"height":11}},{"id":"daed9dfa-c17a-4e47-8cc9-ee84eab630e6","block_type":"box","text":"cause foreign securities owned by the Fund to be held in its offices outside the United States and with certain foreign","page_number":114,"box":{"x":69,"y":740,"width":839,"height":11}},{"id":"ad82509d-81fb-4424-8d7e-49b6250d0dd4","block_type":"box","text":"banks and securities depositories. A Fund also may use special purpose custodian banks from time to time for","page_number":114,"box":{"x":69,"y":755,"width":792,"height":11}},{"id":"f19020a4-26f3-4401-bf71-25272d2a3363","block_type":"box","text":"certain assets.","page_number":114,"box":{"x":69,"y":771,"width":106,"height":8}},{"id":"6109220d-4175-4dd5-a4d1-bc928c45583e","block_type":"box","text":"For certain Feeder Funds, the Custodian also acts as the custodian of the Master Portfolio’s assets.","page_number":114,"box":{"x":102,"y":793,"width":716,"height":10}},{"id":"66c646d7-6540-405f-a793-2baf8929f3ee","block_type":"box","text":"Generally, overdraft charges, if any, are treated as interest expense. 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With respect to such Funds, the custodian fees, including the amount","page_number":114,"box":{"x":69,"y":846,"width":834,"height":11}},{"id":"b1199a4d-fd54-4de5-9880-9cc036460a2a","block_type":"box","text":"of any overdraft charges, may be reduced by the amount of such custody credits, and any unused credits at the end","page_number":114,"box":{"x":69,"y":861,"width":826,"height":11}},{"id":"a8ab97e5-66b4-4dfe-beb0-531256946447","block_type":"box","text":"of a given month may be carried forward to a subsequent month. Any such credits unused by the end of a Fund’s","page_number":114,"box":{"x":69,"y":876,"width":807,"height":11}},{"id":"e07df90a-d6d7-4a67-baa9-d5f03aa8573e","block_type":"box","text":"fiscal year will not expire. Net debits at the end of a given month are added to the Fund’s custody bill and paid by the","page_number":114,"box":{"x":68,"y":891,"width":836,"height":12}},{"id":"2e2ff638-1039-481d-879b-7cdcae1ed85c","block_type":"box","text":"Fund.","page_number":114,"box":{"x":70,"y":907,"width":36,"height":8}},{"id":"76db6859-759b-4989-bc04-2098b8366236","block_type":"box","text":"II-83","page_number":114,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"ec480dc4-e3c3-4a27-b49b-26c7c5c7ec58","block_type":"box","text":"NM0926U-5977317-114/232","page_number":114,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"843d02d5-912c-4041-8ce9-5b75ed91e0d1","block_type":"box","text":"Accounting Services.","page_number":115,"box":{"x":101,"y":45,"width":148,"height":11}},{"id":"c6cfe876-827c-4535-902e-6abb746b991e","block_type":"box","text":"Each Fund has entered into an agreement with State Street, BNY Mellon or JPM, pursuant","page_number":115,"box":{"x":256,"y":45,"width":641,"height":11}},{"id":"f35464a6-cb5d-4d51-8284-3bdf7f05efef","block_type":"box","text":"to which State Street, BNY Mellon or JPM provides certain accounting and administrative services to the Fund. 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State Street, BNY Mellon or JPM provides similar accounting services to the","page_number":115,"box":{"x":70,"y":75,"width":797,"height":11}},{"id":"889d71ae-c5eb-44e3-bddc-e84eeb13b60a","block_type":"box","text":"Master LLCs.","page_number":115,"box":{"x":70,"y":90,"width":91,"height":9}},{"id":"9b7139df-23a3-495f-b14f-b7d926781e7f","block_type":"box","text":"See “Management, Advisory and Other Service Arrangements — Accounting Services” or “Management and","page_number":115,"box":{"x":102,"y":113,"width":771,"height":11}},{"id":"9caac762-0d84-4bb8-91d9-f3e2d961e93c","block_type":"box","text":"Advisory Arrangements — Accounting Services,” as applicable, in Part I of each Fund’s SAI for information on the","page_number":115,"box":{"x":68,"y":128,"width":810,"height":11}},{"id":"6b73b0ac-0c93-4c77-8121-677cd1ebdfe2","block_type":"box","text":"amounts paid by your Fund and, if applicable, Master LLC to State Street, BNY Mellon or JPM and the Manager or, if","page_number":115,"box":{"x":69,"y":143,"width":828,"height":11}},{"id":"96f65642-be93-4808-9591-6070c56fec92","block_type":"box","text":"applicable, the Administrator for the periods indicated.","page_number":115,"box":{"x":69,"y":158,"width":386,"height":11}},{"id":"e8c23754-dd02-46e0-81f2-e28e6d8bc46e","block_type":"box","text":"Distribution Expenses.","page_number":115,"box":{"x":102,"y":181,"width":158,"height":11}},{"id":"317e74fb-ae20-42b4-a11c-771a45f4de20","block_type":"box","text":"Each Fund has entered into a distribution agreement with the Distributor in connection","page_number":115,"box":{"x":267,"y":181,"width":614,"height":11}},{"id":"f9dce080-8939-4dc2-98fe-4dca4bc246e9","block_type":"box","text":"with the continuous offering of each class of shares of the Fund (the “Distribution Agreements”). The Distribution","page_number":115,"box":{"x":68,"y":196,"width":807,"height":11}},{"id":"29cdfd46-48f5-45c9-b6a7-62cc3cf8d9c5","block_type":"box","text":"Agreements obligate the Distributor to pay certain expenses in connection with the offering of each class of shares of","page_number":115,"box":{"x":68,"y":211,"width":842,"height":11}},{"id":"f2b5cc50-da24-4968-b733-df5184ffd1c9","block_type":"box","text":"the Funds. After the prospectuses, statements of additional information and periodic reports have been prepared,","page_number":115,"box":{"x":68,"y":226,"width":813,"height":11}},{"id":"e14b8e2b-583b-438d-97d5-3598ffaad4f5","block_type":"box","text":"set in type and mailed to shareholders, the Distributor pays for the printing and distribution of these documents used","page_number":115,"box":{"x":69,"y":241,"width":836,"height":11}},{"id":"32990ada-c7f4-48c8-819d-5d64d6be3c00","block_type":"box","text":"in connection with the offering to dealers and investors. The Distributor also pays for other supplementary sales","page_number":115,"box":{"x":70,"y":256,"width":799,"height":12}},{"id":"9293a60a-ff6d-4e3e-84e1-e01d6824c0fa","block_type":"box","text":"literature and advertising costs. Each Distribution Agreement is subject to the same renewal requirements and","page_number":115,"box":{"x":70,"y":272,"width":788,"height":11}},{"id":"694dfa92-8c79-45c7-a9ff-448f0fc75cce","block_type":"box","text":"termination provisions as the Management Agreement described above.","page_number":115,"box":{"x":68,"y":287,"width":513,"height":11}},{"id":"46068a34-1e62-4ada-a328-d5112259647d","block_type":"box","text":"Code of Ethics","page_number":115,"box":{"x":69,"y":317,"width":105,"height":9}},{"id":"ad88f8fc-0bd4-49c0-9458-b1e49c4b175d","block_type":"box","text":"Each Fund, the Manager, each Sub-Adviser and the Distributor has adopted a Code of Ethics pursuant to Rule","page_number":115,"box":{"x":102,"y":339,"width":780,"height":12}},{"id":"33ea84b4-141b-493d-b6a5-79713e8c1f15","block_type":"box","text":"17j-1 under the Investment Company Act. The Code of Ethics establishes procedures for personal investing and","page_number":115,"box":{"x":70,"y":355,"width":794,"height":11}},{"id":"5bc6f8f6-b4be-4d27-9961-cae9348a15dc","block_type":"box","text":"restricts certain transactions. Employees subject to the Code of Ethics may invest in securities for their personal","page_number":115,"box":{"x":69,"y":370,"width":803,"height":11}},{"id":"e2e5e9ad-9d61-454f-854d-c7e10560f420","block_type":"box","text":"investment accounts, including securities that may be purchased or held by a Fund.","page_number":115,"box":{"x":70,"y":385,"width":593,"height":11}},{"id":"2208b658-7bde-4377-bf44-8384a9bf35cd","block_type":"box","text":"SELECTIVE DISCLOSURE OF PORTFOLIO HOLDINGS","page_number":115,"box":{"x":282,"y":414,"width":413,"height":10}},{"id":"51cab631-bb19-4905-9dd6-30472064d911","block_type":"box","text":"The Board of Directors of each Fund and the Board of Directors of the Manager have each approved Portfolio","page_number":115,"box":{"x":101,"y":437,"width":777,"height":11}},{"id":"9bd5e65e-0f03-4211-8ae7-f59d85a708e5","block_type":"box","text":"Holdings and Related Information Distribution Guidelines (the “Policy”) regarding the disclosure of each Fund’s","page_number":115,"box":{"x":70,"y":452,"width":788,"height":11}},{"id":"10490d70-7408-45e4-894c-eade923d4e46","block_type":"box","text":"portfolio securities, as applicable, and other portfolio information. 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BlackRock, its subsidiaries and their","page_number":120,"box":{"x":102,"y":339,"width":731,"height":12}},{"id":"d96dfeb2-a517-4437-9132-11390115dcb3","block_type":"box","text":"respective directors, officers and employees, including the business units or entities and personnel who may be","page_number":120,"box":{"x":69,"y":355,"width":799,"height":11}},{"id":"5bf9a03b-2405-41bc-bd47-aa32d24b717e","block_type":"box","text":"involved in the investment activities and business operations of a Fund, are engaged worldwide in businesses,","page_number":120,"box":{"x":70,"y":370,"width":786,"height":11}},{"id":"af9ec477-b1d6-45e4-b3fc-eecc897af2b7","block_type":"box","text":"including managing equities, fixed income securities, cash and alternative investments, and other financial services,","page_number":120,"box":{"x":70,"y":385,"width":829,"height":11}},{"id":"c555c6cd-df55-470e-8338-963fff59aa2e","block_type":"box","text":"and have interests other than that of managing the Funds. 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BlackRock may (but is not required to) effect purchases and sales between","page_number":121,"box":{"x":68,"y":574,"width":817,"height":11}},{"id":"3cda52db-ce94-4521-83d4-dd3cdf2da941","block_type":"box","text":"BlackRock clients (“cross trades”), including the Funds, if BlackRock believes such transactions are appropriate","page_number":121,"box":{"x":70,"y":589,"width":797,"height":11}},{"id":"306e77b1-a59f-4163-be3b-85d63050506b","block_type":"box","text":"based on each party’s investment objectives and guidelines, subject to applicable law and regulation. 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BlackRock may have a potentially conflicting division of","page_number":121,"box":{"x":69,"y":634,"width":791,"height":12}},{"id":"1681b499-680f-4c5a-affd-7c15767eb5f6","block_type":"box","text":"loyalties and responsibilities to the parties in such transactions.","page_number":121,"box":{"x":70,"y":650,"width":457,"height":11}},{"id":"6165b390-b2e9-4736-8b87-15e1ac2f08e0","block_type":"box","text":"BlackRock and its clients may pursue or enforce rights with respect to an issuer in which a Fund has invested,","page_number":121,"box":{"x":102,"y":672,"width":784,"height":11}},{"id":"191512e6-26f1-4d0e-9628-f3dc17745c01","block_type":"box","text":"and those activities may have an adverse effect on the Fund. 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It is possible that one or more accounts managed or advised by BlackRock and such other","page_number":121,"box":{"x":69,"y":786,"width":798,"height":11}},{"id":"2f74706d-6b42-42d7-8f0f-1abba5988fc6","block_type":"box","text":"accounts will achieve investment results that are substantially more or less favorable than the results achieved by a","page_number":121,"box":{"x":69,"y":801,"width":828,"height":11}},{"id":"44a74161-5d0f-49ef-b5be-00b3f0dbfbca","block_type":"box","text":"Fund. Moreover, it is possible that a Fund will sustain losses during periods in which one or more proprietary or other","page_number":121,"box":{"x":70,"y":816,"width":835,"height":11}},{"id":"a6b998cb-0ae5-4a26-8c51-52d219b0783f","block_type":"box","text":"accounts managed or advised by BlackRock achieve significant profits. The opposite result is also possible.","page_number":121,"box":{"x":69,"y":831,"width":767,"height":11}},{"id":"3583d4ac-d2dd-4531-ab30-ec39b6b003e1","block_type":"box","text":"From time to time, a Fund may be restricted from purchasing or selling securities, or from engaging in other","page_number":121,"box":{"x":102,"y":853,"width":766,"height":12}},{"id":"7e718aa4-8c13-41f2-a7e9-8c35d31ba753","block_type":"box","text":"investment activities because of regulatory, legal or contractual requirements applicable to BlackRock or other","page_number":121,"box":{"x":70,"y":869,"width":786,"height":11}},{"id":"c7155261-0e3d-4041-9e18-42c52cdd3dad","block_type":"box","text":"accounts managed or advised by BlackRock, and/or the internal policies of BlackRock designed to comply with such","page_number":121,"box":{"x":69,"y":884,"width":828,"height":11}},{"id":"a7ac6ce0-651c-4c13-a985-190234429b61","block_type":"box","text":"requirements. As a result, there may be periods, for example, when BlackRock will not initiate or recommend certain","page_number":121,"box":{"x":69,"y":899,"width":831,"height":11}},{"id":"8e78cdb4-c87c-46ae-b0f7-2e07adffc790","block_type":"box","text":"II-90","page_number":121,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"bc3dc4e9-090d-45a5-8f6b-ebf10f201125","block_type":"box","text":"NM0926U-5977317-121/232","page_number":121,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"d66c3d24-9b93-47d5-ac40-9e5e387904a6","block_type":"box","text":"types of transactions in certain securities or instruments with respect to which BlackRock is performing services or","page_number":122,"box":{"x":68,"y":45,"width":825,"height":11}},{"id":"5b22065e-df9e-42c3-9f3d-e9fb57517e4f","block_type":"box","text":"when position limits have been reached. For example, the investment activities of BlackRock for its proprietary","page_number":122,"box":{"x":68,"y":60,"width":790,"height":11}},{"id":"13bc2c85-0a7f-4e1d-a2d5-1bb6258101ce","block_type":"box","text":"accounts and accounts under its management may limit the investment opportunities for a Fund in certain emerging","page_number":122,"box":{"x":69,"y":75,"width":830,"height":11}},{"id":"f0ef5b15-f73a-45c1-b08e-8e6fab02bb3f","block_type":"box","text":"and other markets in which limitations are imposed upon the amount of investment, in the aggregate or in individual","page_number":122,"box":{"x":69,"y":90,"width":827,"height":11}},{"id":"a3745697-f8dd-45a8-8575-8c13f05c74c1","block_type":"box","text":"issuers, by affiliated foreign investors.","page_number":122,"box":{"x":70,"y":105,"width":271,"height":11}},{"id":"c588173f-269b-4592-b10c-c6ba72c3ee14","block_type":"box","text":"In connection with its management of a Fund, BlackRock may have access to certain fundamental analysis and","page_number":122,"box":{"x":102,"y":128,"width":792,"height":11}},{"id":"7233c493-296b-431b-ad25-fde01956d04d","block_type":"box","text":"proprietary technical models developed by BlackRock. BlackRock will not be under any obligation, however, to effect","page_number":122,"box":{"x":70,"y":143,"width":826,"height":11}},{"id":"d6fab878-8a46-45f8-a90d-9efab572d24c","block_type":"box","text":"transactions on behalf of a Fund in accordance with such analysis and models. In addition, BlackRock will not have","page_number":122,"box":{"x":68,"y":158,"width":821,"height":11}},{"id":"7f414e10-3998-4946-9e6c-ad5c2f11da4a","block_type":"box","text":"any obligation to make available any information regarding its proprietary activities or strategies, or the activities or","page_number":122,"box":{"x":69,"y":173,"width":821,"height":11}},{"id":"8ecad89e-1cbe-4500-a426-789e7c2f7958","block_type":"box","text":"strategies used for other accounts managed by them, for the benefit of the management of a Fund and it is not","page_number":122,"box":{"x":69,"y":188,"width":793,"height":12}},{"id":"10b166dd-8d94-4836-8653-e8a06df7f7ce","block_type":"box","text":"anticipated that BlackRock will have access to such information for the purpose of managing the Fund. The","page_number":122,"box":{"x":69,"y":203,"width":762,"height":12}},{"id":"64638fba-d81b-420c-8efd-21b2ddae223e","block_type":"box","text":"proprietary activities or portfolio strategies of BlackRock, or the activities or strategies used for accounts managed by","page_number":122,"box":{"x":70,"y":218,"width":839,"height":12}},{"id":"4b6ddd6f-b84c-42da-9a79-176cf8a4fc94","block_type":"box","text":"BlackRock or other client accounts could conflict with the transactions and strategies employed by BlackRock in","page_number":122,"box":{"x":70,"y":234,"width":795,"height":11}},{"id":"deea7203-412a-414b-8ac4-0c44169be948","block_type":"box","text":"managing a Fund.","page_number":122,"box":{"x":69,"y":249,"width":124,"height":11}},{"id":"24ccd710-c714-49c8-b1e6-029bb26f1212","block_type":"box","text":"The Funds may be included in investment models developed by BlackRock for use by clients and financial","page_number":122,"box":{"x":101,"y":271,"width":751,"height":12}},{"id":"ac8f12f4-b234-495f-9317-dd46a52bfd54","block_type":"box","text":"advisors. To the extent clients invest in these investment models and increase the assets under management of the","page_number":122,"box":{"x":69,"y":286,"width":830,"height":12}},{"id":"9be7f33a-7676-4193-93c4-35857caf9f34","block_type":"box","text":"Funds, the investment management fee amounts paid by the Funds to BlackRock may also increase. The net asset","page_number":122,"box":{"x":70,"y":302,"width":820,"height":11}},{"id":"76e58b66-7d28-476b-a3cf-b29676205397","block_type":"box","text":"value and liquidity of a Fund may be impacted by purchases and sales of the Fund by model-driven investment","page_number":122,"box":{"x":68,"y":317,"width":785,"height":11}},{"id":"a242c266-04e2-4687-a4ce-0facc35721ae","block_type":"box","text":"portfolios, as well as by BlackRock itself and by its advisory clients.","page_number":122,"box":{"x":70,"y":332,"width":481,"height":11}},{"id":"9b454a6d-4026-4b29-bf15-c4a9b760407e","block_type":"box","text":"In addition, certain principals and certain employees of a Fund’s investment adviser are also principals or","page_number":122,"box":{"x":102,"y":355,"width":754,"height":11}},{"id":"9f7a56c0-1c49-4202-beaa-e6fce72e3b6e","block_type":"box","text":"employees of other business units or entities within BlackRock. As a result, these principals and employees may","page_number":122,"box":{"x":69,"y":370,"width":804,"height":11}},{"id":"1335cac3-32ea-4734-9e05-06736d296f1b","block_type":"box","text":"have obligations to such other business units or entities or their clients and such obligations to other business units","page_number":122,"box":{"x":69,"y":385,"width":831,"height":11}},{"id":"5452162e-a426-4a9d-894e-a9f251be3d93","block_type":"box","text":"or entities or their clients may be a consideration of which investors in a Fund should be aware.","page_number":122,"box":{"x":69,"y":400,"width":680,"height":11}},{"id":"0abc934b-bc62-4555-b08f-3c8731be02e5","block_type":"box","text":"BlackRock may enter into transactions and invest in securities, instruments and currencies on behalf of a Fund","page_number":122,"box":{"x":102,"y":423,"width":791,"height":11}},{"id":"55e8c3a2-52e5-47b7-8077-5053f1b2293e","block_type":"box","text":"in which clients of BlackRock, or, to the extent permitted by the Commission and applicable law, BlackRock, serves","page_number":122,"box":{"x":70,"y":438,"width":820,"height":11}},{"id":"804565e7-8b59-4314-a7a6-9e87ec6c0785","block_type":"box","text":"as the counterparty, principal or issuer. In such cases, such party’s interests in the transaction will be adverse to the","page_number":122,"box":{"x":69,"y":453,"width":837,"height":11}},{"id":"aad84e06-c6eb-4d9a-93c7-d98c897c7845","block_type":"box","text":"interests of the Fund, and such party may have no incentive to assure that the Fund obtains the best possible prices","page_number":122,"box":{"x":70,"y":468,"width":832,"height":11}},{"id":"962b98eb-77e9-4ca6-9a6c-794d972c7805","block_type":"box","text":"or terms in connection with the transactions. In addition, the purchase, holding and sale of such investments by a","page_number":122,"box":{"x":69,"y":483,"width":813,"height":11}},{"id":"0c474f8d-5aa3-4c8b-a8ea-98f1254df43e","block_type":"box","text":"Fund may enhance the profitability of BlackRock.","page_number":122,"box":{"x":70,"y":498,"width":344,"height":11}},{"id":"920d95ed-b428-447a-acfc-ec1777c58042","block_type":"box","text":"BlackRock may also create, write or issue derivatives for clients, the underlying securities, currencies or","page_number":122,"box":{"x":102,"y":521,"width":741,"height":11}},{"id":"a7b71d1a-82a2-4204-a898-d6e3a5ddbfe2","block_type":"box","text":"instruments of which may be those in which a Fund invests or which may be based on the performance of the Fund.","page_number":122,"box":{"x":70,"y":536,"width":824,"height":11}},{"id":"3d92671e-5e6f-4e6a-b4c4-506eaa0ec84d","block_type":"box","text":"Additionally, an affiliate of BlackRock will create, write or issue options, which may be based on the performance of","page_number":122,"box":{"x":68,"y":551,"width":825,"height":11}},{"id":"4930a611-d805-4e18-a37c-9ef5b5535f02","block_type":"box","text":"certain Funds. BlackRock has entered into an arrangement with Markit Indices Limited, the index provider for","page_number":122,"box":{"x":69,"y":566,"width":777,"height":11}},{"id":"0827cede-116d-4b68-b357-cd0c9b0df81b","block_type":"box","text":"underlying fixed-income indexes used by certain iShares ETFs, related to derivative fixed-income products that are","page_number":122,"box":{"x":69,"y":581,"width":810,"height":12}},{"id":"535cc0a1-3559-4f73-8f64-f9e2f214a658","block_type":"box","text":"based on such iShares ETFs. Trading activity in these derivative products could also potentially lead to greater","page_number":122,"box":{"x":69,"y":597,"width":784,"height":11}},{"id":"6fe94d29-d4ef-45d2-95d9-1b4992e910bb","block_type":"box","text":"liquidity for such products, increased purchase activity with respect to these iShares ETFs and increased assets","page_number":122,"box":{"x":70,"y":612,"width":798,"height":11}},{"id":"9a743ae1-6ba4-4b66-b938-b513810a8833","block_type":"box","text":"under management for BlackRock.","page_number":122,"box":{"x":69,"y":627,"width":243,"height":11}},{"id":"12f7b4f8-4fe9-461b-bd7e-512e5de87f6a","block_type":"box","text":"A Fund may, subject to applicable law, purchase investments that are the subject of an underwriting or other","page_number":122,"box":{"x":101,"y":649,"width":773,"height":12}},{"id":"c566cc43-7ddc-4cf7-97e9-801aa337dd09","block_type":"box","text":"distribution by BlackRock and may also enter into transactions with other clients of BlackRock where such other","page_number":122,"box":{"x":69,"y":664,"width":797,"height":12}},{"id":"6ae60f7c-4796-4bcc-8ccb-5aad3ac140e8","block_type":"box","text":"clients have interests adverse to those of the Fund. At times, these activities may cause business units or entities","page_number":122,"box":{"x":69,"y":680,"width":817,"height":11}},{"id":"a31d1386-f4b2-477f-b2c6-6a69fc0c357a","block_type":"box","text":"within BlackRock to give advice to clients that may cause these clients to take actions adverse to the interests of the","page_number":122,"box":{"x":68,"y":695,"width":837,"height":11}},{"id":"e36f4218-a39e-4bba-8dad-573a8b3b2b69","block_type":"box","text":"Fund. To the extent such transactions are permitted, a Fund will deal with BlackRock on an arms-length basis.","page_number":122,"box":{"x":70,"y":710,"width":781,"height":11}},{"id":"ccdc3c56-ab99-4d1e-b93a-c987bd0ca5ac","block_type":"box","text":"To the extent authorized by applicable law, BlackRock may act as broker, dealer, agent, lender or adviser or in","page_number":122,"box":{"x":101,"y":733,"width":779,"height":11}},{"id":"a148e236-1330-47e8-9f2b-72814380afd5","block_type":"box","text":"other commercial capacities for a Fund. It is anticipated that the commissions, mark-ups, mark-downs, financial","page_number":122,"box":{"x":69,"y":748,"width":795,"height":11}},{"id":"bf43a9fd-ddbd-439e-85fb-775d3ab7aa0c","block_type":"box","text":"advisory fees, underwriting and placement fees, sales fees, financing and commitment fees, brokerage fees, other","page_number":122,"box":{"x":69,"y":763,"width":821,"height":11}},{"id":"da6227ec-cdce-4290-8014-4d84b158f318","block_type":"box","text":"fees, compensation or profits, rates, terms and conditions charged by BlackRock will be in its view commercially","page_number":122,"box":{"x":68,"y":778,"width":802,"height":11}},{"id":"e6beeb50-406a-4b4c-99f1-7f79a099fc5c","block_type":"box","text":"reasonable, although BlackRock, including its sales personnel, will have an interest in obtaining fees and other","page_number":122,"box":{"x":69,"y":793,"width":792,"height":11}},{"id":"8039336c-3b14-4d66-b6d1-150ed7af722c","block_type":"box","text":"amounts that are favorable to BlackRock and such sales personnel, which may have an adverse effect on the Funds.","page_number":122,"box":{"x":69,"y":808,"width":832,"height":11}},{"id":"10536ed5-90d0-4b32-a91e-0067e5317377","block_type":"box","text":"Index based funds may use an index provider that is affiliated with another service provider of the Fund or BlackRock","page_number":122,"box":{"x":70,"y":823,"width":833,"height":11}},{"id":"387fe7de-413d-4a66-bb26-4b2c5c6ac3bf","block_type":"box","text":"that acts as a broker, dealer, agent, lender or in other commercial capacities for a Fund or BlackRock.","page_number":122,"box":{"x":68,"y":838,"width":726,"height":12}},{"id":"791d8202-4e93-49f4-9584-61799ea2e0a2","block_type":"box","text":"Subject to applicable law, BlackRock (and its personnel and other distributors) will be entitled to retain fees and","page_number":122,"box":{"x":102,"y":861,"width":796,"height":11}},{"id":"55def044-7f6f-4d21-80ea-e4a73f44d34c","block_type":"box","text":"other amounts that they receive in connection with their service to the Funds as broker, dealer, agent, lender, adviser","page_number":122,"box":{"x":69,"y":876,"width":837,"height":11}},{"id":"e08bd227-de4f-4f41-93a1-90bfcfed148f","block_type":"box","text":"or in other commercial capacities. No accounting to the Funds or their shareholders will be required, and no fees or","page_number":122,"box":{"x":69,"y":891,"width":823,"height":12}},{"id":"3681d447-942f-40a6-8f8a-f327baa0a431","block_type":"box","text":"II-91","page_number":122,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"f7909719-b6b6-4f69-9bcc-2596b704413b","block_type":"box","text":"NM0926U-5977317-122/232","page_number":122,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"662e62fb-f3ba-4b07-ab3b-e979edfa07de","block_type":"box","text":"other compensation payable by the Funds or their shareholders will be reduced by reason of receipt by BlackRock of","page_number":123,"box":{"x":69,"y":45,"width":828,"height":11}},{"id":"1213f610-2efd-44e9-82b3-ea9167b66cef","block_type":"box","text":"any such fees or other amounts.","page_number":123,"box":{"x":69,"y":60,"width":230,"height":11}},{"id":"1c19ef86-8536-4f7c-a5d1-356a04cc2e69","block_type":"box","text":"When BlackRock acts as broker, dealer, agent, adviser or in other commercial capacities in relation to the Funds,","page_number":123,"box":{"x":101,"y":83,"width":805,"height":11}},{"id":"5e175913-9969-4615-9345-95c32a42cd00","block_type":"box","text":"BlackRock may take commercial steps in its own interests, which may have an adverse effect on the Funds.","page_number":123,"box":{"x":70,"y":98,"width":768,"height":11}},{"id":"468e0afd-9643-4016-bf3d-a9b293e4b962","block_type":"box","text":"A Fund will be required to establish business relationships with its counterparties based on the Fund’s own","page_number":123,"box":{"x":101,"y":120,"width":766,"height":11}},{"id":"65e99e59-a3bc-495c-91b9-40a88a23bbc5","block_type":"box","text":"credit standing. BlackRock will not have any obligation to allow its credit to be used in connection with a Fund’s","page_number":123,"box":{"x":69,"y":136,"width":793,"height":11}},{"id":"ee836010-d28b-4035-a1f5-2c7019bd349e","block_type":"box","text":"establishment of its business relationships, nor is it expected that the Fund’s counterparties will rely on the credit of","page_number":123,"box":{"x":69,"y":150,"width":835,"height":12}},{"id":"bddbbcdc-8bb0-4f16-8c93-59409286f1bb","block_type":"box","text":"BlackRock in evaluating the Fund’s creditworthiness.","page_number":123,"box":{"x":70,"y":166,"width":374,"height":11}},{"id":"d2d8ba0a-ac1c-4e4e-a022-6a0c3e1e69d3","block_type":"box","text":"BlackRock Investment Management, LLC (“BIM”) or BlackRock Institutional Trust Company, N.A. (“BTC”), as","page_number":123,"box":{"x":102,"y":188,"width":768,"height":12}},{"id":"047ec634-538d-4987-b904-2189ecd19d33","block_type":"box","text":"applicable, each an affiliate of BlackRock, pursuant to SEC exemptive relief, acts as securities lending agent to, and","page_number":123,"box":{"x":69,"y":203,"width":829,"height":12}},{"id":"de5b3c9a-01d5-4bc2-9ccd-0aa00bdf3d55","block_type":"box","text":"receives a share of securities lending revenues from, the Funds. BlackRock will also receive compensation for","page_number":123,"box":{"x":69,"y":218,"width":785,"height":12}},{"id":"119a2f90-ee2b-4515-8bd3-93df147d5c87","block_type":"box","text":"managing the reinvestment of the cash collateral from securities lending. There are potential conflicts of interests in","page_number":123,"box":{"x":69,"y":234,"width":829,"height":11}},{"id":"ad001f68-5ebe-475b-b415-ec50a70c0b7a","block_type":"box","text":"managing a securities lending program, including but not limited to: (i) BlackRock as securities lending agent may","page_number":123,"box":{"x":69,"y":249,"width":809,"height":11}},{"id":"d9cf21a9-327e-49b0-85d3-af87d78a86e6","block_type":"box","text":"have an incentive to, among other things, increase or decrease the amount of securities on loan or to lend particular","page_number":123,"box":{"x":69,"y":264,"width":833,"height":11}},{"id":"7e6c2367-05fc-400b-b9cc-29055a46a53a","block_type":"box","text":"securities in order to generate additional risk-adjusted revenue for BlackRock and its affiliates; and (ii) BlackRock as","page_number":123,"box":{"x":69,"y":279,"width":829,"height":11}},{"id":"a43e48c2-7073-4f22-985f-19f1e74a6075","block_type":"box","text":"securities lending agent may have an incentive to allocate loans to clients that would provide more revenue to","page_number":123,"box":{"x":69,"y":294,"width":783,"height":11}},{"id":"53f5d13d-ac6d-4c61-9f5f-4b755d4f6705","block_type":"box","text":"BlackRock. As described further below, BlackRock seeks to mitigate this conflict by providing its securities lending","page_number":123,"box":{"x":70,"y":309,"width":814,"height":11}},{"id":"b2bc468f-a58a-4092-a83a-bc941339edc3","block_type":"box","text":"clients with equal lending opportunities over time in order to approximate pro rata allocation.","page_number":123,"box":{"x":69,"y":325,"width":660,"height":11}},{"id":"a9e5e25e-7d15-468b-a15c-59b8ad15bcf8","block_type":"box","text":"As part of its securities lending program, BlackRock indemnifies the Funds and certain other clients and/or","page_number":123,"box":{"x":101,"y":347,"width":767,"height":11}},{"id":"aa42954a-cd7f-4537-80b0-267276394713","block_type":"box","text":"funds against a shortfall in collateral in the event of borrower default. On a regular basis, BlackRock calculates the","page_number":123,"box":{"x":68,"y":362,"width":820,"height":11}},{"id":"27b56ff6-d519-40d4-939f-5c6312f53dd5","block_type":"box","text":"potential dollar exposure of collateral shortfall resulting from a borrower default (“shortfall risk”) in the securities","page_number":123,"box":{"x":70,"y":377,"width":806,"height":12}},{"id":"dba3e004-c3a9-4953-b26c-e2bf034a1c98","block_type":"box","text":"lending program. BlackRock establishes program-wide borrower limits (“credit limits”) to actively manage borrower","page_number":123,"box":{"x":70,"y":393,"width":816,"height":11}},{"id":"5724ec7e-e229-4b52-b6d1-cc882cc3c071","block_type":"box","text":"specific credit exposure. BlackRock oversees the risk model that calculates projected collateral shortfall values using","page_number":123,"box":{"x":69,"y":407,"width":838,"height":12}},{"id":"4aab8a8d-34ac-41e0-b3b7-10d137dd29de","block_type":"box","text":"loan-level factors such as loan and collateral type and market value as well as specific borrower credit","page_number":123,"box":{"x":70,"y":423,"width":727,"height":11}},{"id":"b5fce890-5665-4819-bba0-8eb0019a09f3","block_type":"box","text":"characteristics. When necessary, BlackRock may adjust securities lending program attributes by restricting eligible","page_number":123,"box":{"x":69,"y":438,"width":815,"height":11}},{"id":"6188281c-2fe8-49ae-9fb6-f1c46c6cd7d1","block_type":"box","text":"collateral or reducing borrower credit limits. As a result, the management of program-wide exposure as well as","page_number":123,"box":{"x":69,"y":453,"width":786,"height":11}},{"id":"55642235-d9f5-44a6-b6a5-ff023ac3429b","block_type":"box","text":"BlackRock-specific indemnification exposure may affect the amount of securities lending activity BlackRock may","page_number":123,"box":{"x":70,"y":468,"width":796,"height":11}},{"id":"c8fdbf8c-88f7-4081-829f-83e59974df54","block_type":"box","text":"conduct at any given point in time by reducing the volume of lending opportunities for certain loans (including by","page_number":123,"box":{"x":69,"y":483,"width":799,"height":11}},{"id":"35c30bf9-612e-4dbe-8fbf-82c5f965b7f6","block_type":"box","text":"asset type, collateral type and/or revenue profile).","page_number":123,"box":{"x":69,"y":498,"width":356,"height":11}},{"id":"4e1a6ce5-dd83-4c5a-818a-f989bece6f1a","block_type":"box","text":"BlackRock may decline to make a securities loan on behalf of a Fund, discontinue lending on behalf of a Fund or","page_number":123,"box":{"x":102,"y":521,"width":801,"height":11}},{"id":"93a700ca-7198-446a-8a33-c4b87f3a9f3b","block_type":"box","text":"terminate a securities loan on behalf of a Fund for any reason, including but not limited to regulatory requirements","page_number":123,"box":{"x":68,"y":536,"width":817,"height":11}},{"id":"499800be-e29d-4f5b-a7f6-ff0d54591f04","block_type":"box","text":"and/or market rules, liquidity considerations, or credit considerations, which may impact Funds by reducing or","page_number":123,"box":{"x":69,"y":551,"width":784,"height":11}},{"id":"4da2fd9e-7360-4a3f-90f7-2f7a3463e43a","block_type":"box","text":"eliminating the volume of lending opportunities for certain types of loans, loans in particular markets, loans of","page_number":123,"box":{"x":69,"y":566,"width":789,"height":11}},{"id":"61eca767-fc21-4a16-aaa4-37e788aa7b81","block_type":"box","text":"particular securities or types of securities, or for loans overall. In addition, some borrowers may prefer certain","page_number":123,"box":{"x":70,"y":581,"width":783,"height":11}},{"id":"5d4a9e5d-be9c-4ce0-87fa-91fbc650235d","block_type":"box","text":"BlackRock lenders that provide additional protections against lender default that are favored by their prudential","page_number":123,"box":{"x":70,"y":596,"width":790,"height":12}},{"id":"355d47ea-f39a-4514-b82f-4ffe0da42b78","block_type":"box","text":"regulation.","page_number":123,"box":{"x":69,"y":612,"width":73,"height":11}},{"id":"bc5f45bd-a6ca-4d5e-8f05-22ce57b355b0","block_type":"box","text":"BlackRock uses a predetermined systematic process in order to approximate pro rata allocation over time. In","page_number":123,"box":{"x":102,"y":634,"width":777,"height":11}},{"id":"3ebdd3a6-988e-49f4-8588-1bcc37c461b8","block_type":"box","text":"order to allocate a loan to a portfolio: (i) BlackRock as a whole must have sufficient lending capacity pursuant to the","page_number":123,"box":{"x":69,"y":649,"width":830,"height":12}},{"id":"6b13ae4e-4271-49ea-85cf-f29a2d386912","block_type":"box","text":"various program limits (","page_number":123,"box":{"x":68,"y":665,"width":168,"height":11}},{"id":"ac2e896c-e960-4192-ace3-b3693c7f1c0c","block_type":"box","text":"i.e.","page_number":123,"box":{"x":238,"y":665,"width":20,"height":8}},{"id":"f2e01ba4-8411-490a-9ae2-56a3314d43b3","block_type":"box","text":"indemnification exposure limit and borrower credit limits); (ii) the lending portfolio must","page_number":123,"box":{"x":265,"y":664,"width":621,"height":12}},{"id":"c782a540-d383-4c3d-b6bf-7eea25e8cf16","block_type":"box","text":"hold the asset at the time a loan opportunity arrives; and (iii) the lending portfolio must also have enough inventory,","page_number":123,"box":{"x":69,"y":680,"width":827,"height":11}},{"id":"09cfdbf4-5556-4021-92f7-22d2f87ea3e9","block_type":"box","text":"either on its own or when aggregated with other portfolios into one single market delivery, to satisfy the loan request.","page_number":123,"box":{"x":69,"y":695,"width":836,"height":11}},{"id":"9e7ae4d7-0680-4df5-8add-135857f11c6e","block_type":"box","text":"In doing so, BlackRock seeks to provide equal lending opportunities for all portfolios, independent of whether","page_number":123,"box":{"x":70,"y":710,"width":780,"height":11}},{"id":"2d792227-e176-4ac0-9041-a0c3763ccdfb","block_type":"box","text":"BlackRock indemnifies the portfolio. Equal opportunities for lending portfolios does not guarantee equal outcomes.","page_number":123,"box":{"x":70,"y":725,"width":820,"height":11}},{"id":"b5bf5dcb-1590-43f8-9c5e-c023ec4ce96c","block_type":"box","text":"Specifically, short and long-term outcomes for individual clients may vary due to asset mix, asset/liability spreads on","page_number":123,"box":{"x":69,"y":740,"width":834,"height":11}},{"id":"e86843cd-710b-4705-b02a-4a27fdebd0d4","block_type":"box","text":"different securities, and the overall limits imposed by the firm.","page_number":123,"box":{"x":69,"y":755,"width":444,"height":11}},{"id":"ad5a224c-97d7-4d63-b46f-49eeb634eee4","block_type":"box","text":"Purchases and sales of securities and other assets for a Fund may be aggregated with orders for other","page_number":123,"box":{"x":102,"y":778,"width":734,"height":11}},{"id":"560f9c60-903a-43fb-a7a5-f8134d777266","block_type":"box","text":"BlackRock client accounts, including with accounts that pay different transaction costs solely due to the fact that they","page_number":123,"box":{"x":70,"y":793,"width":840,"height":11}},{"id":"11cdd692-166f-463a-a94b-1120a74927ac","block_type":"box","text":"have different research payment arrangements. BlackRock, however, is not required to aggregate orders if portfolio","page_number":123,"box":{"x":69,"y":808,"width":822,"height":11}},{"id":"18e4ca2a-f13f-45cd-a81a-0de2fc8da8eb","block_type":"box","text":"management decisions for different accounts are made separately, or if they determine that aggregating is not","page_number":123,"box":{"x":69,"y":823,"width":788,"height":12}},{"id":"5ab8509b-684e-49b3-9c24-f544101c9663","block_type":"box","text":"practicable or required, or in cases involving client direction.","page_number":123,"box":{"x":70,"y":839,"width":426,"height":11}},{"id":"bcf1f7ff-09e6-4a27-8c97-96e8fd8ce619","block_type":"box","text":"Prevailing trading activity frequently may make impossible the receipt of the same price or execution on the","page_number":123,"box":{"x":102,"y":861,"width":763,"height":11}},{"id":"892cc314-4b7a-401b-8e6b-2f49ee22efa6","block_type":"box","text":"entire volume of securities purchased or sold. When this occurs, the various prices may be averaged, and the Funds","page_number":123,"box":{"x":69,"y":876,"width":828,"height":11}},{"id":"031f8169-7ea3-44f9-ad96-24eaae589745","block_type":"box","text":"will be charged or credited with the average price. Thus, the effect of the aggregation may operate on some","page_number":123,"box":{"x":68,"y":891,"width":767,"height":12}},{"id":"dab3cf77-2fe7-4feb-9205-00cca5eae351","block_type":"box","text":"II-92","page_number":123,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"bf9aa363-c350-4864-8a11-bd076d61d184","block_type":"box","text":"NM0926U-5977317-123/232","page_number":123,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"718a8b85-9892-4629-aa8f-31b9a421cc39","block_type":"box","text":"occasions to the disadvantage of the Funds. In addition, under certain circumstances, the Funds will not be charged","page_number":124,"box":{"x":69,"y":45,"width":828,"height":11}},{"id":"4c3e1d8a-7c7f-4502-b5ed-48169f2020f5","block_type":"box","text":"the same commission or commission equivalent rates in connection with an aggregated order.","page_number":124,"box":{"x":68,"y":60,"width":672,"height":11}},{"id":"c322a3cc-c788-4d7b-ac82-ebe5ab041b9b","block_type":"box","text":"As discussed in the section below entitled “Portfolio Transactions and Brokerage—Transactions in Portfolio","page_number":124,"box":{"x":101,"y":82,"width":767,"height":12}},{"id":"271998bd-8a4e-4cf6-8604-ba67f0e14442","block_type":"box","text":"Securities,” BlackRock, unless prohibited by applicable law, may cause a Fund or account to pay a broker or dealer a","page_number":124,"box":{"x":69,"y":98,"width":832,"height":11}},{"id":"1bc73717-978d-4cb0-8651-e241d8593062","block_type":"box","text":"commission for effecting a transaction that exceeds the amount another broker or dealer would have charged for","page_number":124,"box":{"x":69,"y":113,"width":805,"height":11}},{"id":"d6548e38-7441-45bd-aa22-4baae9daa04a","block_type":"box","text":"effecting the same transaction in recognition of the value of brokerage and research services provided by that broker","page_number":124,"box":{"x":69,"y":128,"width":836,"height":11}},{"id":"808789cd-7f72-4133-96cc-849fea0d6fe9","block_type":"box","text":"or dealer. Under MiFID II, EU investment managers, including BlackRock International Limited (“BIL”) which acts as a","page_number":124,"box":{"x":69,"y":143,"width":831,"height":11}},{"id":"7e59e9fe-2c6f-45e2-8687-efcc949922a1","block_type":"box","text":"sub-adviser to certain Funds, pay for research from brokers and dealers directly out of their own resources, rather","page_number":124,"box":{"x":69,"y":158,"width":812,"height":11}},{"id":"0514e1ac-52a3-4d5d-a10a-eaac9d4cd9a7","block_type":"box","text":"than through client commissions.","page_number":124,"box":{"x":68,"y":173,"width":237,"height":11}},{"id":"76f66310-f435-473b-882f-0276bc1f5752","block_type":"box","text":"Subject to applicable law, BlackRock may select brokers that furnish BlackRock, the Funds, other BlackRock","page_number":124,"box":{"x":102,"y":196,"width":770,"height":11}},{"id":"553cad79-6b73-4161-905c-6acb623be709","block_type":"box","text":"client accounts or personnel, directly or through correspondent relationships, with research or other appropriate","page_number":124,"box":{"x":69,"y":211,"width":797,"height":11}},{"id":"a7d9bb17-bdcc-4ee3-80cc-66f60f2c9da5","block_type":"box","text":"services which provide, in BlackRock’s view, appropriate assistance to BlackRock in the investment decision making","page_number":124,"box":{"x":69,"y":226,"width":830,"height":11}},{"id":"99fdc8e5-1235-425b-893c-356ca65e92b7","block_type":"box","text":"process (including with respect to futures, fixed-price offerings and OTC transactions). Such research or other","page_number":124,"box":{"x":70,"y":241,"width":780,"height":11}},{"id":"2f8a8f70-eacf-41a9-a595-312ce99063da","block_type":"box","text":"services may include, to the extent permitted by law, research reports on companies, industries and securities;","page_number":124,"box":{"x":69,"y":257,"width":795,"height":10}},{"id":"4ae1dd5c-1d55-48dc-9e2a-34cceed64581","block_type":"box","text":"economic and financial data; financial publications; proxy analysis; trade industry seminars; computer data bases;","page_number":124,"box":{"x":69,"y":271,"width":815,"height":12}},{"id":"7e5d4050-26a4-44c7-85f6-533e1ac14d86","block_type":"box","text":"research-oriented software and other services and products.","page_number":124,"box":{"x":69,"y":286,"width":430,"height":11}},{"id":"b7930b5e-dd0a-45a6-9d4a-89633df202f0","block_type":"box","text":"Research or other services obtained in this manner may be used in servicing any or all of the Funds and other","page_number":124,"box":{"x":102,"y":309,"width":785,"height":11}},{"id":"2873f4aa-ad19-46ad-8bf0-dd93b0465f46","block_type":"box","text":"BlackRock client accounts, including in connection with BlackRock client accounts other than those that pay","page_number":124,"box":{"x":70,"y":325,"width":768,"height":11}},{"id":"f9cfdef7-54b8-42c7-9f55-896934c305f4","block_type":"box","text":"commissions to the broker relating to the research or other service arrangements. Such products and services may","page_number":124,"box":{"x":69,"y":340,"width":826,"height":11}},{"id":"b2ef736b-7ee2-4664-a70b-e2cb04433214","block_type":"box","text":"disproportionately benefit other BlackRock client accounts relative to the Funds based on the amount of brokerage","page_number":124,"box":{"x":69,"y":355,"width":818,"height":11}},{"id":"d46fcc25-18eb-4e43-9b5f-086dc64d7620","block_type":"box","text":"commissions paid by the Funds and such other BlackRock client accounts. For example, research or other services","page_number":124,"box":{"x":69,"y":370,"width":821,"height":11}},{"id":"dbab6683-59b8-4474-8839-1fb833470e15","block_type":"box","text":"that are paid for through one client’s commissions may not be used in managing that client’s account. In addition,","page_number":124,"box":{"x":68,"y":385,"width":815,"height":11}},{"id":"53ad23a9-997e-4f60-9a60-296e62f7ba16","block_type":"box","text":"other BlackRock client accounts may receive the benefit, including disproportionate benefits, of economies of scale","page_number":124,"box":{"x":69,"y":400,"width":824,"height":11}},{"id":"47e18477-e0f0-4846-9b39-0ac137d82209","block_type":"box","text":"or price discounts in connection with products and services that may be provided to the Funds and to such other","page_number":124,"box":{"x":69,"y":415,"width":804,"height":11}},{"id":"66e6e387-cc91-4d55-b702-8ba916600f6c","block_type":"box","text":"BlackRock client accounts. To the extent that BlackRock uses soft dollars, it will not have to pay for those products","page_number":124,"box":{"x":70,"y":430,"width":819,"height":11}},{"id":"4076cbd3-3d36-429a-84e9-079a363b9c93","block_type":"box","text":"and services itself.","page_number":124,"box":{"x":69,"y":445,"width":134,"height":9}},{"id":"3f9533c8-b5c7-4416-b875-c74aff9286ba","block_type":"box","text":"BlackRock, unless prohibited by applicable law, may endeavor to execute trades through brokers who, pursuant","page_number":124,"box":{"x":102,"y":468,"width":793,"height":11}},{"id":"95859815-8568-45d1-8229-5ef067e87b44","block_type":"box","text":"to such arrangements, provide research or other services in order to ensure the continued receipt of research or","page_number":124,"box":{"x":68,"y":483,"width":805,"height":11}},{"id":"7b34b8c4-1b9a-46ae-a1e2-04176bd327ed","block_type":"box","text":"other services BlackRock believes are useful in its investment decision-making process. BlackRock may from time to","page_number":124,"box":{"x":69,"y":498,"width":833,"height":11}},{"id":"75855b4a-a033-4185-aa46-6b85bf99f9e8","block_type":"box","text":"time choose not to engage in the above described arrangements to varying degrees. BlackRock, unless prohibited by","page_number":124,"box":{"x":68,"y":514,"width":836,"height":11}},{"id":"161b258e-8fef-46c1-b922-f033832056d0","block_type":"box","text":"applicable law, may also enter into commission sharing arrangements under which BlackRock may execute","page_number":124,"box":{"x":69,"y":529,"width":760,"height":11}},{"id":"0266348e-cb82-48d9-8617-556ecaf849ef","block_type":"box","text":"transactions through a broker-dealer and request that the broker-dealer allocate a portion of the commissions or","page_number":124,"box":{"x":68,"y":543,"width":803,"height":12}},{"id":"a82a5de9-cb84-41a7-9ba1-9c1120dcf2c5","block_type":"box","text":"commission credits to another firm that provides research to BlackRock. To the extent that BlackRock engages in","page_number":124,"box":{"x":69,"y":559,"width":807,"height":11}},{"id":"e0e2206c-6a7a-49b9-86a1-4ba9cb444596","block_type":"box","text":"commission sharing arrangements, many of the same conflicts related to traditional soft dollars may exist.","page_number":124,"box":{"x":69,"y":574,"width":760,"height":11}},{"id":"981ca8c5-f4e8-4e71-9c73-bb213bbfe828","block_type":"box","text":"BlackRock may utilize certain electronic crossing networks (“ECNs”) (including, without limitation, ECNs in which","page_number":124,"box":{"x":102,"y":597,"width":799,"height":11}},{"id":"11715bcc-5b5c-4d3b-9525-3fe6be9b8f01","block_type":"box","text":"BlackRock has an investment or other interest, to the extent permitted by applicable law) in executing client","page_number":124,"box":{"x":70,"y":612,"width":767,"height":11}},{"id":"92e105de-a7dc-4818-b633-c98d787bef03","block_type":"box","text":"securities transactions for certain types of securities. These ECNs may charge fees for their services, including","page_number":124,"box":{"x":69,"y":627,"width":794,"height":11}},{"id":"cd9d24ff-027f-4483-a4c8-e38911fcd49c","block_type":"box","text":"access fees and transaction fees. The transaction fees, which are similar to commissions or markups/ markdowns,","page_number":124,"box":{"x":69,"y":642,"width":825,"height":11}},{"id":"82802428-e3bd-462d-8af3-489ace5c1e22","block_type":"box","text":"will generally be charged to clients and, like commissions and markups/markdowns, would generally be included in","page_number":124,"box":{"x":68,"y":657,"width":821,"height":11}},{"id":"2a2076b2-8e5f-4d82-94db-1af39b00a99f","block_type":"box","text":"the cost of the securities purchased. Access fees may be paid by BlackRock even though incurred in connection with","page_number":124,"box":{"x":68,"y":672,"width":833,"height":11}},{"id":"0de40799-c307-4317-909f-39460e18ace9","block_type":"box","text":"executing transactions on behalf of clients, including the Funds. In certain circumstances, ECNs may offer volume","page_number":124,"box":{"x":69,"y":687,"width":812,"height":11}},{"id":"0bf0cdcc-386f-489e-be0e-2c0ff27ecc88","block_type":"box","text":"discounts that will reduce the access fees typically paid by BlackRock. BlackRock will only utilize ECNs consistent","page_number":124,"box":{"x":69,"y":702,"width":809,"height":11}},{"id":"9cf16bec-eb6f-4b47-b23c-49b554d865e0","block_type":"box","text":"with its obligation to seek to obtain best execution in client transactions.","page_number":124,"box":{"x":68,"y":718,"width":519,"height":11}},{"id":"f911abc1-4114-46f6-a56e-eefe96500e0a","block_type":"box","text":"BlackRock owns a minority interest in, and is a member of, Members Exchange (“MEMX”), a newly created U.S.","page_number":124,"box":{"x":102,"y":740,"width":793,"height":11}},{"id":"139320a5-6d7c-49a8-ba46-8593a1a9958b","block_type":"box","text":"stock exchange. Transactions for a Fund may be executed on MEMX if third party brokers select MEMX as the","page_number":124,"box":{"x":69,"y":755,"width":782,"height":11}},{"id":"b9655fa9-7b1d-4405-acb5-76c8aae841a7","block_type":"box","text":"appropriate venue for execution of orders placed by BlackRock traders on behalf of client portfolios.","page_number":124,"box":{"x":69,"y":770,"width":710,"height":11}},{"id":"731ded2d-2fd3-4e0e-a3b0-31ed60770d73","block_type":"box","text":"BlackRock has adopted policies and procedures designed to prevent conflicts of interest from influencing proxy","page_number":124,"box":{"x":102,"y":793,"width":792,"height":11}},{"id":"535692a5-d54a-4052-8771-811f38951936","block_type":"box","text":"voting decisions that it makes on behalf of advisory clients, including the Funds, and to help ensure that such","page_number":124,"box":{"x":68,"y":808,"width":784,"height":11}},{"id":"d065035c-665c-4f8b-ab00-2ea6db67cd61","block_type":"box","text":"decisions are made in accordance with BlackRock’s fiduciary obligations to its clients. Nevertheless, notwithstanding","page_number":124,"box":{"x":69,"y":823,"width":837,"height":12}},{"id":"16795051-709f-4c51-bbb0-ab4f68e4812e","block_type":"box","text":"such proxy voting policies and procedures, actual proxy voting decisions of BlackRock may have the effect of favoring","page_number":124,"box":{"x":69,"y":838,"width":835,"height":12}},{"id":"08f333ae-24a7-44f2-9547-1e7040b3c44f","block_type":"box","text":"the interests of other clients or businesses of other divisions or units of BlackRock, provided that BlackRock believes","page_number":124,"box":{"x":68,"y":853,"width":837,"height":11}},{"id":"cff2443d-0c1d-411b-b6bf-b6a8ef3ab22e","block_type":"box","text":"such voting decisions to be in accordance with its fiduciary obligations. For a more detailed discussion of these","page_number":124,"box":{"x":69,"y":869,"width":795,"height":11}},{"id":"f00e3ede-82bd-4e31-b96c-3e0f8b53f983","block_type":"box","text":"policies and procedures, see “Proxy Voting Policies and Procedures.”","page_number":124,"box":{"x":70,"y":884,"width":490,"height":11}},{"id":"591553af-9d13-4d05-a600-dd48fea171ea","block_type":"box","text":"II-93","page_number":124,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"11ea7f78-1de0-44d9-95cf-7b56e5bed706","block_type":"box","text":"NM0926U-5977317-124/232","page_number":124,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"c517f499-a3dd-4cab-b8bf-628b4258db7a","block_type":"box","text":"It is also possible that, from time to time, BlackRock and/or its advisory clients (including other funds and","page_number":125,"box":{"x":102,"y":45,"width":757,"height":11}},{"id":"e0c13806-2d37-4d84-9908-7e249b526edc","block_type":"box","text":"separately managed accounts) may, subject to compliance with applicable law, purchase and hold shares of a Fund.","page_number":125,"box":{"x":69,"y":60,"width":825,"height":11}},{"id":"806ca0c8-5fe9-4908-95b7-0ddcde4577c4","block_type":"box","text":"Increasing a Fund’s assets may enhance investment flexibility and diversification and may contribute to economies of","page_number":125,"box":{"x":70,"y":75,"width":837,"height":11}},{"id":"39d88db0-a63b-434e-8bca-52089f0deb99","block_type":"box","text":"scale that tend to reduce the Fund’s expense ratio. BlackRock reserves the right, subject to compliance with","page_number":125,"box":{"x":69,"y":90,"width":774,"height":11}},{"id":"2fc0ffcb-ae40-4e30-880b-2d4d0e1faa8b","block_type":"box","text":"applicable law, to redeem at any time some or all of the shares of a Fund acquired for its own accounts. A large","page_number":125,"box":{"x":69,"y":105,"width":796,"height":11}},{"id":"41465b60-5465-459a-9c16-699b39d413d0","block_type":"box","text":"redemption of shares of a Fund by BlackRock could significantly reduce the asset size of the Fund, which might have","page_number":125,"box":{"x":69,"y":120,"width":830,"height":12}},{"id":"abf9e09e-0021-4297-945f-9c2729f0fed2","block_type":"box","text":"an adverse effect on the Fund’s investment flexibility, portfolio diversification and expense ratio. 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BlackRock and its sales personnel may","page_number":125,"box":{"x":69,"y":362,"width":814,"height":11}},{"id":"44a9f41e-357d-4934-89d4-4342a94ca21e","block_type":"box","text":"directly or indirectly receive a portion of the fees and commissions charged to the Funds or their shareholders.","page_number":125,"box":{"x":69,"y":377,"width":788,"height":12}},{"id":"c63d054c-0b26-4d48-9115-a6a79d4c8001","block_type":"box","text":"BlackRock and its advisory or other personnel may also benefit from increased amounts of assets under","page_number":125,"box":{"x":70,"y":392,"width":745,"height":12}},{"id":"198a3b68-f460-41c8-97fd-57d90bb06ba8","block_type":"box","text":"management. 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BlackRock has been designated as the Fund’s valuation designee pursuant to Rule 2a-5","page_number":125,"box":{"x":68,"y":604,"width":803,"height":11}},{"id":"594500dd-f452-4d6b-a0c1-86b0480b496e","block_type":"box","text":"under the Investment Company Act and acts through BlackRock’s Rule 2a-5 Committee (the “2a-5 Committee”), with","page_number":125,"box":{"x":69,"y":619,"width":831,"height":11}},{"id":"5b71cfd3-06e4-43ce-be85-95b5f03cbc93","block_type":"box","text":"assistance from other BlackRock pricing committees and in accordance with BlackRock’s policies and procedures","page_number":125,"box":{"x":69,"y":634,"width":811,"height":12}},{"id":"e6c9c04e-55be-4283-acd7-0b2e457d6996","block_type":"box","text":"(the “Valuation Procedures”). When determining a “fair value price,” the 2a-5 Committee seeks to determine the","page_number":125,"box":{"x":69,"y":649,"width":802,"height":12}},{"id":"93a3d3e1-b655-41d1-a2b5-75dddf9d86c3","block_type":"box","text":"price that a Fund might reasonably expect to receive from the current sale of that asset or liability in an arm’s-length","page_number":125,"box":{"x":70,"y":664,"width":829,"height":12}},{"id":"5cac4bf4-f42f-469e-b6d3-559fb4d608c0","block_type":"box","text":"transaction. The price generally may not be determined based on what a Fund might reasonably expect to receive for","page_number":125,"box":{"x":68,"y":680,"width":832,"height":11}},{"id":"c839cd92-9ff9-4ceb-aa1f-ea11299f0fa2","block_type":"box","text":"selling an asset or liability at a later time or if it holds the asset or liability to maturity. 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The fair value of one or more assets or","page_number":125,"box":{"x":69,"y":740,"width":839,"height":11}},{"id":"64d1d431-9f7c-4042-9b7c-e57116b50144","block_type":"box","text":"liabilities may not, in retrospect, be the price at which those assets or liabilities could have been sold during the","page_number":125,"box":{"x":70,"y":755,"width":800,"height":11}},{"id":"0ba6e51f-1b91-415f-b904-18746c8813ea","block_type":"box","text":"period in which the particular fair values were used in determining a Fund’s NAV. As a result, a Fund’s sale or","page_number":125,"box":{"x":70,"y":770,"width":779,"height":12}},{"id":"25022f8b-ad34-43f4-a0ac-8ef6c9be5ac6","block_type":"box","text":"redemption of its shares at NAV, at a time when a holding or holdings are valued by the 2a-5 Committee at fair value,","page_number":125,"box":{"x":69,"y":785,"width":834,"height":12}},{"id":"7ba56244-e07f-4dcf-bb97-427cda900b27","block_type":"box","text":"may have the effect of diluting or increasing the economic interest of existing shareholders and may affect the","page_number":125,"box":{"x":69,"y":801,"width":788,"height":11}},{"id":"d048b26f-23aa-490f-919d-0dc2490b65e6","block_type":"box","text":"amount of revenue received by BlackRock with respect to services for which it receives an asset-based fee.","page_number":125,"box":{"x":69,"y":816,"width":765,"height":11}},{"id":"0ddfcb0d-9689-4423-9ac3-51e18268b291","block_type":"box","text":"To the extent permitted by applicable law, a Fund may invest all or some of its short term cash investments in","page_number":125,"box":{"x":101,"y":838,"width":784,"height":11}},{"id":"535ce004-d326-437a-812e-71c06b22ed89","block_type":"box","text":"any money market fund or similarly-managed private fund advised or managed by BlackRock. In connection with any","page_number":125,"box":{"x":69,"y":853,"width":823,"height":12}},{"id":"b8706422-f259-4b9e-a8c5-70b27e2196f3","block_type":"box","text":"such investments, a Fund, to the extent permitted by the Investment Company Act, may pay its share of expenses of","page_number":125,"box":{"x":69,"y":869,"width":833,"height":11}},{"id":"9de82460-aef9-4979-b5c4-4655bd714495","block_type":"box","text":"a money market fund or other similarly-managed private fund in which it invests, which may result in a Fund bearing","page_number":125,"box":{"x":69,"y":884,"width":822,"height":11}},{"id":"ce4ca5e0-e411-4795-a391-efb184c6c9b0","block_type":"box","text":"some additional expenses.","page_number":125,"box":{"x":69,"y":899,"width":190,"height":11}},{"id":"3d1b788f-daba-414a-a874-ab5b1af6765f","block_type":"box","text":"II-94","page_number":125,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"fa8e982e-e921-41aa-aa03-225e11be3928","block_type":"box","text":"NM0926U-5977317-125/232","page_number":125,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"02f7d340-6399-4e66-9c5e-56654058503b","block_type":"box","text":"BlackRock and its directors, officers and employees, may buy and sell securities or other investments for their","page_number":126,"box":{"x":102,"y":45,"width":787,"height":11}},{"id":"54cd4ec9-d216-4d55-958f-181578869e1f","block_type":"box","text":"own accounts and may have conflicts of interest with respect to investments made on behalf of a Fund. As a result of","page_number":126,"box":{"x":69,"y":60,"width":839,"height":11}},{"id":"536484ef-fe1a-470f-8167-7839255520e8","block_type":"box","text":"differing trading and investment strategies or constraints, positions may be taken by directors, officers and","page_number":126,"box":{"x":69,"y":75,"width":764,"height":11}},{"id":"759c65b8-2419-4040-b1c1-98e6788976e3","block_type":"box","text":"employees of BlackRock that are the same, different from or made at different times than positions taken for the","page_number":126,"box":{"x":69,"y":90,"width":809,"height":11}},{"id":"dfc8d339-f272-4f06-ba45-d1790c974b57","block_type":"box","text":"Fund. To lessen the possibility that a Fund will be adversely affected by this personal trading, the Fund, BRIL and","page_number":126,"box":{"x":70,"y":105,"width":802,"height":11}},{"id":"406af0ab-36c2-4e96-812c-18666e8f93d0","block_type":"box","text":"BlackRock each have adopted a Code of Ethics in compliance with Section 17(j) of the Investment Company Act that","page_number":126,"box":{"x":70,"y":120,"width":828,"height":11}},{"id":"60e30013-1531-4e59-abb3-67f73c6385b9","block_type":"box","text":"restricts securities trading in the personal accounts of investment professionals and others who normally come into","page_number":126,"box":{"x":69,"y":135,"width":825,"height":12}},{"id":"8ee4124d-d02e-43d5-9ef0-e5bbd7c96da4","block_type":"box","text":"possession of information regarding the Fund’s portfolio transactions. Each Code of Ethics is also available on the","page_number":126,"box":{"x":70,"y":150,"width":816,"height":12}},{"id":"af365b37-2434-4079-be82-2cdcb6b36b99","block_type":"box","text":"EDGAR Database on the Commission’s Internet site at http://www.sec.gov, and copies may be obtained, after paying","page_number":126,"box":{"x":70,"y":166,"width":836,"height":11}},{"id":"007f8fe4-97d0-40f0-9d88-0548560793bc","block_type":"box","text":"a duplicating fee, by e-mail at publicinfo@sec.gov.","page_number":126,"box":{"x":69,"y":181,"width":352,"height":11}},{"id":"25b0a983-09a4-41f6-84e7-39a223984e6b","block_type":"box","text":"BlackRock will not purchase securities or other property from, or sell securities or other property to, a Fund,","page_number":126,"box":{"x":102,"y":203,"width":768,"height":12}},{"id":"8f74a6bb-7d96-4ee4-a023-dab718e0f908","block_type":"box","text":"except that the Fund may in accordance with rules or guidance adopted under the Investment Company Act engage in","page_number":126,"box":{"x":69,"y":219,"width":836,"height":11}},{"id":"17cab397-4d89-410e-953b-cc8c9068c68c","block_type":"box","text":"transactions with another Fund or accounts that are affiliated with the Fund as a result of common officers, directors,","page_number":126,"box":{"x":68,"y":234,"width":839,"height":10}},{"id":"4b4ede58-2e06-45d3-86ec-fd0740c174d5","block_type":"box","text":"or investment advisers or pursuant to exemptive orders granted to the Funds and/or BlackRock by the Commission.","page_number":126,"box":{"x":69,"y":249,"width":824,"height":11}},{"id":"40689baa-353e-42b3-844d-56eb25927793","block_type":"box","text":"These transactions would be effected in circumstances in which BlackRock determined that it would be appropriate","page_number":126,"box":{"x":68,"y":264,"width":824,"height":11}},{"id":"d889216c-5b5c-4d8f-b341-ebb642a24cca","block_type":"box","text":"for the Fund to purchase and another client of BlackRock to sell, or the Fund to sell and another client of BlackRock","page_number":126,"box":{"x":68,"y":279,"width":826,"height":11}},{"id":"0347de7a-ccc8-4975-b5aa-ffc64d3210f0","block_type":"box","text":"to purchase, the same security or instrument on the same day. From time to time, the activities of a Fund may be","page_number":126,"box":{"x":68,"y":294,"width":810,"height":11}},{"id":"5a27dc3a-2b09-464c-afa9-2df3c1052120","block_type":"box","text":"restricted because of regulatory requirements applicable to BlackRock and/or BlackRock’s internal policies designed","page_number":126,"box":{"x":69,"y":309,"width":834,"height":11}},{"id":"7262cea2-b4fc-477a-b88a-a88467c979b0","block_type":"box","text":"to comply with, limit the applicability of, or that otherwise relate to such requirements. A client not advised by","page_number":126,"box":{"x":68,"y":324,"width":782,"height":11}},{"id":"563c70e3-c18c-46f6-8e9d-129595f1a9d8","block_type":"box","text":"BlackRock would not be subject to some of those considerations. There may be periods when BlackRock may not","page_number":126,"box":{"x":70,"y":339,"width":807,"height":12}},{"id":"0dc89074-3868-4627-a6a4-052d5d780dbb","block_type":"box","text":"initiate or recommend certain types of transactions, or may otherwise restrict or limit its advice regarding certain","page_number":126,"box":{"x":70,"y":355,"width":804,"height":11}},{"id":"0a63515a-04d0-42f5-8c07-1d953fb4cecd","block_type":"box","text":"securities or instruments issued by or related to companies for which BlackRock is performing advisory or other","page_number":126,"box":{"x":69,"y":370,"width":799,"height":11}},{"id":"14dd0e58-70e8-4255-a05b-dadc90488fbe","block_type":"box","text":"services or has proprietary positions. For example, when BlackRock is engaged to provide advisory or risk","page_number":126,"box":{"x":69,"y":385,"width":755,"height":11}},{"id":"939dcce8-8655-4a57-90a9-bf3c135dfaab","block_type":"box","text":"management services for a company, BlackRock may be prohibited from or limited in purchasing or selling securities","page_number":126,"box":{"x":69,"y":400,"width":831,"height":11}},{"id":"48b0ea10-b449-4d21-b31b-8aebf5588624","block_type":"box","text":"of that company on behalf of a Fund, particularly where such services result in BlackRock obtaining material non","page_number":126,"box":{"x":69,"y":415,"width":806,"height":11}},{"id":"471bb315-5d9f-4563-9d38-95dcccdf45d7","block_type":"box","text":"public information about the company (","page_number":126,"box":{"x":70,"y":430,"width":276,"height":11}},{"id":"eeb82a0a-214b-4957-b218-e822224df9d5","block_type":"box","text":"e.g.","page_number":126,"box":{"x":348,"y":432,"width":25,"height":9}},{"id":"7a7ae98c-f899-43e2-be97-26e47179324c","block_type":"box","text":", in connection with participation in a creditors’ committee). Moreover,","page_number":126,"box":{"x":376,"y":430,"width":499,"height":11}},{"id":"63195392-2bfd-4e29-8aa2-ce23fac37831","block_type":"box","text":"applicable provisions of the Investment Company Act or other regulatory considerations may restrict a Fund or","page_number":126,"box":{"x":69,"y":445,"width":784,"height":12}},{"id":"88709011-e4cc-485a-bc35-234b6da2e5f3","block_type":"box","text":"BlackRock from effecting certain portfolio transactions or taking other actions in respect of an investment on behalf","page_number":126,"box":{"x":70,"y":460,"width":827,"height":12}},{"id":"3dfd8add-ca45-4a2d-8197-42bf5f20b453","block_type":"box","text":"of a Fund, including where BlackRock and/or clients advised by BlackRock already have an interest in such issuer or","page_number":126,"box":{"x":69,"y":475,"width":830,"height":12}},{"id":"ca680ab7-a3ed-49f8-b2b6-6674b931d97e","block_type":"box","text":"the investment. Similar situations could arise if personnel of BlackRock serve as directors of companies the","page_number":126,"box":{"x":68,"y":491,"width":773,"height":11}},{"id":"754f3809-f2ef-4227-92a7-74916241b168","block_type":"box","text":"securities of which the Funds wish to purchase or sell. However, if permitted by applicable law, and where consistent","page_number":126,"box":{"x":69,"y":506,"width":832,"height":11}},{"id":"1f67dc99-5c1d-4852-80c8-106a214268e8","block_type":"box","text":"with BlackRock’s policies and procedures (including the necessary implementation of appropriate information","page_number":126,"box":{"x":68,"y":521,"width":781,"height":11}},{"id":"2e76f560-3400-4561-8b85-660d1d9d33d2","block_type":"box","text":"barriers), the Funds may purchase securities or instruments that are issued by such companies, are the subject of","page_number":126,"box":{"x":69,"y":536,"width":819,"height":11}},{"id":"ac71b831-d572-48f6-aef7-910de30c8e92","block_type":"box","text":"an advisory or risk management assignment by BlackRock, or where personnel of BlackRock are directors or officers","page_number":126,"box":{"x":69,"y":551,"width":832,"height":11}},{"id":"29915650-796c-436a-b1c1-0d1f7ef14773","block_type":"box","text":"of the issuer.","page_number":126,"box":{"x":69,"y":566,"width":92,"height":9}},{"id":"d0edc153-ebc5-4917-a800-a83bb1b20512","block_type":"box","text":"BlackRock has adopted and implemented policies and procedures that are designed to address potential","page_number":126,"box":{"x":102,"y":589,"width":748,"height":11}},{"id":"66fd0540-e3c6-4ab7-813f-3709b4bff427","block_type":"box","text":"conflicts that arise in connection with the advisory services BlackRock provides to Funds and other clients. Certain","page_number":126,"box":{"x":69,"y":604,"width":819,"height":11}},{"id":"60fe1939-ae82-4f91-b1a1-e8a50d287042","block_type":"box","text":"BlackRock advisory personnel may take views, and make decisions or recommendations, that are different than or","page_number":126,"box":{"x":70,"y":619,"width":817,"height":11}},{"id":"d73b2379-98a8-429a-8806-46a7f399e188","block_type":"box","text":"opposite those of other BlackRock advisory personnel. Certain portfolio management teams within BlackRock may","page_number":126,"box":{"x":69,"y":634,"width":818,"height":12}},{"id":"bda33078-1663-45ce-b123-773a3fec24c6","block_type":"box","text":"make decisions or take (or refrain from taking) actions with respect to clients they advise in a manner different than","page_number":126,"box":{"x":69,"y":649,"width":827,"height":12}},{"id":"a5cca2a2-8a26-4c21-9ada-2c4289ed373b","block_type":"box","text":"or adverse to the decisions made or the actions taken (or not taken) by the Funds’ portfolio management teams. The","page_number":126,"box":{"x":69,"y":664,"width":835,"height":12}},{"id":"b8d92215-1eb8-4aba-9b68-9aae476dc196","block_type":"box","text":"various portfolio management teams may not share information with each other, including as a result of certain","page_number":126,"box":{"x":68,"y":680,"width":797,"height":11}},{"id":"6c049fbe-10d8-436a-b36b-da6d3b138827","block_type":"box","text":"information barriers and other policies, and will not have any obligation or other duty to do so.","page_number":126,"box":{"x":70,"y":695,"width":667,"height":11}},{"id":"0421b8b9-747a-47c7-b70b-1a2c3f72fc7b","block_type":"box","text":"BlackRock has established certain information barriers and other policies to address the sharing of information","page_number":126,"box":{"x":102,"y":717,"width":794,"height":12}},{"id":"64bf6422-4a33-4d45-80e1-c622e34217da","block_type":"box","text":"between different businesses within BlackRock, including with respect to personnel responsible with managing","page_number":126,"box":{"x":69,"y":732,"width":791,"height":12}},{"id":"66b2d4ff-9133-4f88-a9fc-dc27a0a1f352","block_type":"box","text":"portfolios and voting proxies with respect to certain index equity portfolios versus those responsible for managing","page_number":126,"box":{"x":70,"y":748,"width":812,"height":11}},{"id":"6459eaa1-6559-46ab-abc0-e7bbf948f8bc","block_type":"box","text":"portfolios and voting proxies with respect to all other portfolios. As a result of information barriers, certain units of","page_number":126,"box":{"x":70,"y":763,"width":818,"height":11}},{"id":"7b0c820d-8471-4dc0-bbf6-60ec41ab7586","block_type":"box","text":"BlackRock generally will not have access, or will have limited access, to certain information and personnel, including","page_number":126,"box":{"x":70,"y":778,"width":830,"height":11}},{"id":"b660a78b-f598-4875-ad5c-77fc7e9d498d","block_type":"box","text":"senior personnel, in other units of BlackRock, and generally will not manage the Funds with the benefit of information","page_number":126,"box":{"x":69,"y":793,"width":835,"height":11}},{"id":"20fff38e-8b44-4065-a622-bd916b9d54b5","block_type":"box","text":"possessed by such other units. Therefore, BlackRock may not be able to review potential investments for the Funds","page_number":126,"box":{"x":70,"y":808,"width":824,"height":11}},{"id":"60a4c43b-4517-4be2-8e64-c53da88ab538","block_type":"box","text":"with the benefit of information held by certain areas of BlackRock.","page_number":126,"box":{"x":68,"y":823,"width":472,"height":11}},{"id":"0f0c468c-cefd-49cf-9a29-43b5bb29f813","block_type":"box","text":"BlackRock may determine to move certain personnel, businesses, or business units from one side of an","page_number":126,"box":{"x":102,"y":846,"width":744,"height":11}},{"id":"0def2d0a-e034-4d2a-a8a9-c129cb7caaad","block_type":"box","text":"information barrier to the other side of the information barrier. In connection therewith, BlackRock personnel,","page_number":126,"box":{"x":70,"y":861,"width":775,"height":11}},{"id":"3fe6eeb6-3443-49e0-9b6f-56000baefff7","block_type":"box","text":"businesses, and business units that were moved will no longer have access to the information and personnel from","page_number":126,"box":{"x":69,"y":876,"width":818,"height":11}},{"id":"d0ae533d-5985-4cca-b685-9df436129ea6","block_type":"box","text":"the side of the information barrier from which they were moved. Information obtained in connection with such","page_number":126,"box":{"x":68,"y":891,"width":779,"height":11}},{"id":"2ce35349-3ddc-4bb0-93b9-9221ab47e01e","block_type":"box","text":"changes to information barriers may limit or restrict the ability of BlackRock to engage in or otherwise effect","page_number":126,"box":{"x":69,"y":906,"width":771,"height":12}},{"id":"2bc8d5ed-b58d-41b5-aa6f-d22d9f1cad8b","block_type":"box","text":"II-95","page_number":126,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"0459a5e3-f059-49b9-adc5-bf4f19fc6064","block_type":"box","text":"NM0926U-5977317-126/232","page_number":126,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"fa1ba656-62e8-4d75-84e4-c27c2a3ba7df","block_type":"box","text":"transactions on behalf of the Funds (including purchasing or selling securities that BlackRock may otherwise have","page_number":127,"box":{"x":68,"y":45,"width":812,"height":11}},{"id":"f3a29051-1fc7-44ca-ac2c-28374b75f80d","block_type":"box","text":"purchased or sold for a client in the absence of a change to an information barrier). Information barriers may not","page_number":127,"box":{"x":70,"y":60,"width":803,"height":11}},{"id":"f9e44667-f7fd-43f9-8dde-d5e016bd5a1f","block_type":"box","text":"have their intended impact due to, for example, changes in applicable law or inadvertent crossings of the barriers,","page_number":127,"box":{"x":69,"y":75,"width":813,"height":11}},{"id":"8323da0e-40af-472d-992b-073d7875ba6c","block_type":"box","text":"and actions by personnel on one side of a barrier may impact the potential actions of personnel on the other side of","page_number":127,"box":{"x":69,"y":90,"width":829,"height":11}},{"id":"ab54c05a-34dd-4a4b-a1b6-b100e26831fa","block_type":"box","text":"a barrier.","page_number":127,"box":{"x":69,"y":105,"width":62,"height":9}},{"id":"dde48f25-679e-4b64-a5f9-6ec6b56bbe6a","block_type":"box","text":"Although the information barriers are intended to allow for independent portfolio management decision-making","page_number":127,"box":{"x":101,"y":128,"width":788,"height":11}},{"id":"585c94e9-87e0-43da-ad9a-18738e6ae9a6","block_type":"box","text":"and proxy voting among certain BlackRock businesses, the investment activities of BlackRock for BlackRock clients,","page_number":127,"box":{"x":69,"y":143,"width":827,"height":11}},{"id":"05b749fb-79f1-42bb-ba8c-8e256c69a857","block_type":"box","text":"as well as BlackRock’s proprietary accounts, may nonetheless limit the investment strategies and rights of other","page_number":127,"box":{"x":69,"y":158,"width":805,"height":11}},{"id":"3fce6cfc-1243-4dc7-a802-851758b59273","block_type":"box","text":"clients (including the Fund). As BlackRock’s assets under management increases, BlackRock clients may face greater","page_number":127,"box":{"x":69,"y":173,"width":840,"height":11}},{"id":"b6da097d-5343-4888-9e67-7824ba4584d8","block_type":"box","text":"negative impacts due to ownership restrictions and limitations imposed by laws, regulations, rules, regulators, or","page_number":127,"box":{"x":69,"y":188,"width":806,"height":12}},{"id":"15c89b32-6a69-4743-8a00-f2e25c0f4193","block_type":"box","text":"issuers. For example, in certain circumstances where a BlackRock client invests in securities issued by companies","page_number":127,"box":{"x":70,"y":204,"width":818,"height":11}},{"id":"8cfc6581-81f9-4418-ba54-5f22942094e8","block_type":"box","text":"that operate in certain industries (","page_number":127,"box":{"x":68,"y":219,"width":244,"height":11}},{"id":"826fe70e-9379-456d-baa2-9306fdd47c42","block_type":"box","text":"e.g.","page_number":127,"box":{"x":314,"y":220,"width":25,"height":10}},{"id":"c4f15cc6-0d0a-4f5c-a456-90ac65f7cef6","block_type":"box","text":", banking, insurance, and utilities) or in certain emerging or international","page_number":127,"box":{"x":342,"y":219,"width":515,"height":11}},{"id":"802cb1d3-cae4-49ee-8246-93d8f0514a0e","block_type":"box","text":"markets, or are subject to regulatory or corporate ownership restrictions (","page_number":127,"box":{"x":69,"y":234,"width":523,"height":11}},{"id":"3621067c-4a4b-489f-96fa-a972b97b0e46","block_type":"box","text":"e.g.","page_number":127,"box":{"x":594,"y":235,"width":25,"height":10}},{"id":"17d70b71-8e09-4a32-9e9c-d66fd695f9ef","block_type":"box","text":", with mechanisms such as poison pills","page_number":127,"box":{"x":621,"y":234,"width":280,"height":11}},{"id":"e6909e9d-d5d1-412a-afad-bdb3c631e4a8","block_type":"box","text":"in place to prevent takeovers), or where a BlackRock client invests in certain futures and derivatives, there may be","page_number":127,"box":{"x":70,"y":249,"width":816,"height":11}},{"id":"a1c208bc-5650-47d3-893b-3e04fac78d0f","block_type":"box","text":"limits on the aggregate amount invested by BlackRock for its clients and BlackRock’s proprietary accounts that may","page_number":127,"box":{"x":70,"y":264,"width":825,"height":11}},{"id":"03099f21-6d85-4b17-939c-b2dcbd320d0c","block_type":"box","text":"not be exceeded without the grant of a license or other regulatory or corporate approval, order, consent, relief, waiver","page_number":127,"box":{"x":69,"y":279,"width":837,"height":11}},{"id":"0bec9aed-daf2-4bf2-8627-edbe864eed31","block_type":"box","text":"or non-disapproval or, if exceeded, may cause BlackRock or its clients to be subject to enforcement actions,","page_number":127,"box":{"x":69,"y":294,"width":769,"height":11}},{"id":"ffc75ce6-45e6-4521-b2ea-d5b8bdf2db8e","block_type":"box","text":"disgorgement of share ownership or profits, regulatory restrictions, complex compliance reporting, increased","page_number":127,"box":{"x":69,"y":309,"width":775,"height":11}},{"id":"a218446f-1aef-495a-83da-5f0af07a662b","block_type":"box","text":"compliance costs or suffer disadvantages or business restrictions. In light of certain restrictions, BlackRock may also","page_number":127,"box":{"x":69,"y":324,"width":839,"height":12}},{"id":"3ed70123-6246-40d9-8007-aea470a0a668","block_type":"box","text":"seek to make indirect investments (","page_number":127,"box":{"x":69,"y":340,"width":255,"height":10}},{"id":"3a98505d-9eb4-4ba4-a47f-7546bbec51eb","block_type":"box","text":"e.g.","page_number":127,"box":{"x":326,"y":341,"width":24,"height":10}},{"id":"b23ce4e0-1534-4106-a465-291a9c60161d","block_type":"box","text":", using derivatives) on behalf of its clients to receive exposure to certain","page_number":127,"box":{"x":353,"y":339,"width":514,"height":12}},{"id":"e80659a7-2ea6-46eb-b9d7-77b59112f8fd","block_type":"box","text":"securities in excess of the applicable ownership restrictions and limitations when legally permitted that will expose","page_number":127,"box":{"x":69,"y":355,"width":817,"height":11}},{"id":"6c2f9eec-3ef1-435c-a0c4-488fb9ccfe48","block_type":"box","text":"such clients to additional costs and additional risks, including any risks associated with investing in derivatives.","page_number":127,"box":{"x":69,"y":370,"width":795,"height":11}},{"id":"8fc3148f-1b23-4055-811a-242580dc18c9","block_type":"box","text":"There may be limited availability of derivatives that provide indirect exposure to an impacted security. BlackRock","page_number":127,"box":{"x":68,"y":385,"width":799,"height":11}},{"id":"08de3d22-3b72-4bfe-9b09-69e47bd1bc36","block_type":"box","text":"clients can be subject to more than one ownership limitation depending on each client’s holdings, and each","page_number":127,"box":{"x":69,"y":400,"width":767,"height":11}},{"id":"edf92787-57cc-460d-828e-a6544dd9f82e","block_type":"box","text":"ownership limitation can impact multiple securities held by the client. Certain clients or shareholders may have their","page_number":127,"box":{"x":69,"y":415,"width":829,"height":11}},{"id":"5b6e5647-6477-42fa-b351-011f05e88a5e","block_type":"box","text":"own overlapping obligations to monitor their compliance with ownership limitations across their investments.","page_number":127,"box":{"x":69,"y":430,"width":772,"height":11}},{"id":"fdf972af-9eff-488e-8eb9-97d9b24b3e8b","block_type":"box","text":"If certain aggregate ownership thresholds are reached either through the actions of BlackRock or a BlackRock","page_number":127,"box":{"x":102,"y":453,"width":783,"height":11}},{"id":"ebf9179e-9ab2-4e89-bbc2-1fb048568eae","block_type":"box","text":"client or as a result of corporate actions by the issuer, the ability of BlackRock on behalf of clients to purchase or","page_number":127,"box":{"x":69,"y":468,"width":808,"height":11}},{"id":"9876e6b0-40d6-4f3e-b2a6-605eead32946","block_type":"box","text":"dispose of investments, or exercise rights (including voting) or undertake business transactions, may be restricted by","page_number":127,"box":{"x":69,"y":483,"width":837,"height":11}},{"id":"4a641a44-852c-4f21-ae00-2b6d17154825","block_type":"box","text":"law, regulation, rule, or organizational documents or otherwise impaired. For example, to meet the requirements of","page_number":127,"box":{"x":70,"y":498,"width":818,"height":11}},{"id":"6c2b5dfb-4c17-422c-b188-feb0abd37a72","block_type":"box","text":"an ownership limitation or restriction, a client may be unable to purchase or directly hold a security the client would","page_number":127,"box":{"x":69,"y":514,"width":821,"height":10}},{"id":"e21aa601-1de6-4958-af44-55f65cce38b5","block_type":"box","text":"otherwise purchase or hold. The limitation or restriction may be based on the holdings of other BlackRock clients","page_number":127,"box":{"x":69,"y":528,"width":806,"height":12}},{"id":"7a1b3e95-d5d5-4545-b091-6663e6619a41","block_type":"box","text":"instead of the specific client being restricted. For index funds, this means a fund may not be able to track its index as","page_number":127,"box":{"x":70,"y":543,"width":839,"height":12}},{"id":"bff852f1-a779-4724-a836-dac88ff0e6e1","block_type":"box","text":"closely as it would if it was not subject to an ownership limitation or restriction because the fund cannot acquire the","page_number":127,"box":{"x":69,"y":559,"width":826,"height":11}},{"id":"5ac24810-ef8e-4a4e-b282-9743f5e5353b","block_type":"box","text":"amount of the impacted security included in its index. BlackRock on behalf of its clients may limit purchases, sell","page_number":127,"box":{"x":69,"y":574,"width":807,"height":11}},{"id":"0923c032-2526-491d-b6e7-ed71ac2842a9","block_type":"box","text":"existing investments, utilize indirect investments, utilize information barriers, or otherwise restrict, forgo, or limit the","page_number":127,"box":{"x":69,"y":589,"width":830,"height":11}},{"id":"8a2a5065-f749-4516-a59c-6f46476be12e","block_type":"box","text":"exercise of rights (including transferring, outsourcing, or limiting voting rights or forgoing the right to receive","page_number":127,"box":{"x":69,"y":604,"width":765,"height":11}},{"id":"bfa8535a-e57e-4b66-b418-8ec03104c29b","block_type":"box","text":"dividends) when BlackRock, in its sole discretion, deems it appropriate in light of potential regulatory or other","page_number":127,"box":{"x":69,"y":619,"width":781,"height":11}},{"id":"6058479a-c24e-4e55-9469-722d79c9f916","block_type":"box","text":"restrictions on ownership or other consequences resulting from reaching investment thresholds. These types of","page_number":127,"box":{"x":69,"y":634,"width":796,"height":12}},{"id":"b741d8e3-22b7-4db3-b3fa-714d27a9b6ea","block_type":"box","text":"restrictions could negatively impact a client’s performance or ability to meet its investment objective.","page_number":127,"box":{"x":69,"y":649,"width":720,"height":12}},{"id":"d740801e-8620-4aa5-a1eb-71adee8e9404","block_type":"box","text":"When BlackRock or a BlackRock client is subject to an ownership limitation, BlackRock may in its discretion seek","page_number":127,"box":{"x":101,"y":672,"width":807,"height":11}},{"id":"13b65761-c8d6-4b6f-b429-c23ec99452a4","block_type":"box","text":"permission from the applicable issuers or regulators to exceed the limitation. However, there is no guarantee that","page_number":127,"box":{"x":70,"y":687,"width":810,"height":11}},{"id":"058d97d2-c27b-49a5-91b2-20b87eab7a4e","block_type":"box","text":"permission will be granted, or that, once granted, it will not be modified or revoked at a later date with minimal or no","page_number":127,"box":{"x":70,"y":702,"width":829,"height":12}},{"id":"73f878cb-67f3-49c4-97b8-fd8d1ebebf1b","block_type":"box","text":"notice. The issuer and/or regulator may also require that BlackRock on behalf of itself and its clients take or refrain","page_number":127,"box":{"x":69,"y":717,"width":824,"height":12}},{"id":"7280f57a-75bf-4b41-aff2-ae2b4c2fd673","block_type":"box","text":"from taking certain actions in connection with the approval, order, consent, relief or non-disapproval, which BlackRock","page_number":127,"box":{"x":68,"y":732,"width":841,"height":12}},{"id":"f7792f7b-444c-4d6e-8ceb-8f2ca6e36b73","block_type":"box","text":"may accept if it believes the benefits outweigh the costs and may limit BlackRock from taking actions that it","page_number":127,"box":{"x":69,"y":748,"width":770,"height":11}},{"id":"2f5b6cdb-df21-44ab-a401-ac1d747e9d23","block_type":"box","text":"otherwise would take. In those circumstances where ownership thresholds or limitations must be observed,","page_number":127,"box":{"x":69,"y":763,"width":769,"height":11}},{"id":"030e4ae2-d12f-44cb-a3e7-42a871a41bbe","block_type":"box","text":"BlackRock seeks to allocate limited investment opportunities equitably among clients, taking into consideration","page_number":127,"box":{"x":70,"y":778,"width":794,"height":11}},{"id":"9ae53cab-1f8c-4ceb-999b-510fd5520fdd","block_type":"box","text":"benchmark weight and investment strategy. BlackRock may adopt certain controls designed to prevent the","page_number":127,"box":{"x":69,"y":793,"width":757,"height":11}},{"id":"5bbf9a0e-4cfe-4f32-b495-60ce45c50b3b","block_type":"box","text":"occurrence of a breach of any applicable ownership threshold or limits, including, for example, when ownership in","page_number":127,"box":{"x":69,"y":808,"width":807,"height":11}},{"id":"ac470f30-dff3-426a-9840-cc6733d2ddd6","block_type":"box","text":"certain securities nears an applicable threshold, BlackRock may limit additional purchases in such securities or, with","page_number":127,"box":{"x":69,"y":823,"width":833,"height":11}},{"id":"7ae51418-ca6f-44be-9fc7-43280c931ffa","block_type":"box","text":"respect to ETFs, remove such securities from the list of Deposit Securities to be delivered to the Fund in connection","page_number":127,"box":{"x":69,"y":838,"width":827,"height":11}},{"id":"20ae691b-8b8d-476c-b133-e8102d3aba0f","block_type":"box","text":"with purchases of Creation Units of such Fund. If client holdings of an issuer exceed an applicable threshold and","page_number":127,"box":{"x":68,"y":853,"width":803,"height":12}},{"id":"5f1d49a3-fe34-4975-af17-bcd0ff75b574","block_type":"box","text":"BlackRock is unable to obtain relief to enable the continued holding of such investments, it may be necessary to","page_number":127,"box":{"x":70,"y":869,"width":802,"height":11}},{"id":"c5e96b31-7c8c-4d36-bdac-7a1fcd971c85","block_type":"box","text":"reduce these positions to meet the applicable limitations and BlackRock or such client may be subject to regulatory","page_number":127,"box":{"x":69,"y":884,"width":826,"height":11}},{"id":"7d7315e9-1297-47d4-a99a-7218aaca6088","block_type":"box","text":"actions. In these cases, the investments will be sold in a manner that BlackRock deems fair and equitable over time.","page_number":127,"box":{"x":69,"y":899,"width":834,"height":11}},{"id":"f5d899ba-ca9f-4ad5-85c3-922675c69fdf","block_type":"box","text":"II-96","page_number":127,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"0219bf18-c47d-4e84-abb4-d55349610a08","block_type":"box","text":"NM0926U-5977317-127/232","page_number":127,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"e359c4c0-8143-4280-84f9-3d728a2815b4","block_type":"box","text":"Ownership limitations are highly complex. It is possible that, despite BlackRock’s intent to either comply with or","page_number":128,"box":{"x":102,"y":45,"width":795,"height":11}},{"id":"068b7745-3224-4b0b-a09e-dedacecc5eb5","block_type":"box","text":"be granted permission to exceed ownership limitations, it may inadvertently breach a limit or violate the corporate or","page_number":128,"box":{"x":69,"y":60,"width":831,"height":11}},{"id":"a3210500-7163-4983-8c6c-bd1f000d62d6","block_type":"box","text":"regulatory approval, order, consent, relief or non-disapproval that was obtained.","page_number":128,"box":{"x":69,"y":75,"width":566,"height":11}},{"id":"29510607-3023-47e5-a776-02fefc4ef911","block_type":"box","text":"In addition to the foregoing, other ownership thresholds may trigger reporting requirements to governmental and","page_number":128,"box":{"x":102,"y":98,"width":798,"height":11}},{"id":"1063af5a-20b1-4641-a378-20c48a16c513","block_type":"box","text":"regulatory authorities, and such reports may entail the disclosure of the identity of a client or BlackRock’s intended","page_number":128,"box":{"x":69,"y":113,"width":823,"height":11}},{"id":"2f4ff3b9-c6b4-4983-8522-cf04d2610297","block_type":"box","text":"strategy with respect to such security or asset.","page_number":128,"box":{"x":69,"y":128,"width":333,"height":11}},{"id":"658fcc6d-adc1-4f59-a62d-a31e2ffed200","block_type":"box","text":"BlackRock may maintain securities indices. To the extent permitted by applicable laws, the Funds may seek to","page_number":128,"box":{"x":102,"y":151,"width":785,"height":11}},{"id":"902ba948-f981-4130-b4cf-066c6032939e","block_type":"box","text":"license and use such indices as part of their investment strategy. Index based funds that seek to track the","page_number":128,"box":{"x":70,"y":166,"width":760,"height":11}},{"id":"5d2558f9-5a5a-414f-a55e-757750631a1d","block_type":"box","text":"performance of securities indices also may use the name of the index or index provider in the fund name. Index","page_number":128,"box":{"x":70,"y":181,"width":796,"height":11}},{"id":"5b77b2d3-5890-47ed-81c2-707cac2b8fb4","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":128,"box":{"x":70,"y":196,"width":830,"height":11}},{"id":"20afab87-b11c-4502-b904-43df31dc3e6f","block_type":"box","text":"index or index name. In instances where BlackRock charges a unitary management fee, BlackRock may have a","page_number":128,"box":{"x":70,"y":211,"width":788,"height":11}},{"id":"b0eb77f6-8d3b-473c-b436-348af5c1e55f","block_type":"box","text":"financial incentive to use a BlackRock index that is less costly to BlackRock than a third party index. BlackRock may","page_number":128,"box":{"x":68,"y":226,"width":829,"height":11}},{"id":"312e6257-1c94-4848-b50c-ea35c170b599","block_type":"box","text":"benefit from the Funds using BlackRock indices by creating increasing acceptance in the marketplace for such","page_number":128,"box":{"x":69,"y":241,"width":784,"height":11}},{"id":"241db121-0b2e-4192-8c6c-dcac2e6d2605","block_type":"box","text":"indices. BlackRock is not obligated to license its indices to a Fund and the Funds are under no obligation to use","page_number":128,"box":{"x":70,"y":257,"width":797,"height":11}},{"id":"77940cae-04ae-4b6b-acb0-08acf3b07d75","block_type":"box","text":"BlackRock indices. Any Fund that enters into a license for a BlackRock index cannot be assured that the terms of any","page_number":128,"box":{"x":70,"y":271,"width":837,"height":12}},{"id":"99569f78-da4b-4d32-bef8-09d79fb06f4d","block_type":"box","text":"index licensing agreement with BlackRock will be as favorable as those terms offered to other licensees.","page_number":128,"box":{"x":70,"y":286,"width":746,"height":12}},{"id":"50e71cd8-5e7f-4d35-a919-b9ee51d17630","block_type":"box","text":"BlackRock may enter into contractual arrangements with third-party service providers to a Fund (","page_number":128,"box":{"x":102,"y":309,"width":686,"height":11}},{"id":"7900c575-a420-4131-b939-7b0e4ca9bf35","block_type":"box","text":"e.g.","page_number":128,"box":{"x":790,"y":311,"width":25,"height":9}},{"id":"3e10c171-77ec-4a2b-9743-2197e5c0ebb3","block_type":"box","text":", custodians,","page_number":128,"box":{"x":817,"y":309,"width":90,"height":11}},{"id":"f4642daf-0397-40f5-9342-93f34235affe","block_type":"box","text":"administrators and index providers) pursuant to which BlackRock receives fee discounts or concessions in","page_number":128,"box":{"x":69,"y":324,"width":756,"height":11}},{"id":"87423036-5fe7-4e19-bc36-ef96afb08a20","block_type":"box","text":"recognition of BlackRock’s overall relationship with such service providers. BlackRock may also enter into contractual","page_number":128,"box":{"x":69,"y":339,"width":836,"height":12}},{"id":"d1a8c720-97a3-496c-a48f-56be80125785","block_type":"box","text":"arrangements with such service providers pursuant to which BlackRock incurs additional costs if the service","page_number":128,"box":{"x":69,"y":355,"width":772,"height":11}},{"id":"255fd0fb-5e8d-40c9-acda-307ea3bb96f2","block_type":"box","text":"provider’s services are terminated with respect to a Fund. To the extent that BlackRock is responsible for paying","page_number":128,"box":{"x":70,"y":370,"width":800,"height":11}},{"id":"3c0efa1d-4445-41a5-b258-4669c823cd95","block_type":"box","text":"service providers out of its fees that it receives from the Funds, the benefits of lower fees, including any fee","page_number":128,"box":{"x":69,"y":385,"width":771,"height":11}},{"id":"f4539b8c-42d9-4757-a7ae-3015112688d9","block_type":"box","text":"discounts or concessions, or any additional savings, may accrue, in whole or in part, to BlackRock, which could result","page_number":128,"box":{"x":69,"y":400,"width":839,"height":11}},{"id":"570a6d9c-8cc3-4435-a8ce-56b9491ba024","block_type":"box","text":"in conflicts of interest relating to the use or termination of service providers to a Fund. In addition, conflicts of","page_number":128,"box":{"x":70,"y":415,"width":785,"height":11}},{"id":"49ed58d5-bc8c-4796-b7ce-1db5e0bb8ae7","block_type":"box","text":"interest may arise with respect to contractual arrangements with third-party service providers to a Fund, or the","page_number":128,"box":{"x":70,"y":430,"width":786,"height":11}},{"id":"f1cef941-1731-4493-b146-0d189751fdb6","block_type":"box","text":"selection of such providers, particularly in circumstances where BlackRock is negotiating on behalf of both funds that","page_number":128,"box":{"x":69,"y":445,"width":837,"height":12}},{"id":"cc2b0e7d-6924-4f9a-a18c-c173fa646e8b","block_type":"box","text":"have a unitary management fee and those that do not or different service providers have different fee structures.","page_number":128,"box":{"x":69,"y":460,"width":809,"height":12}},{"id":"ea432af8-356a-401f-a418-f4d07f6b59b1","block_type":"box","text":"Conflicts of interest may arise as a result of simultaneous investment management of multiple client accounts","page_number":128,"box":{"x":102,"y":483,"width":788,"height":11}},{"id":"603d5bdd-70e2-4aa9-b56c-f2e5c70e383a","block_type":"box","text":"by BlackRock’s investment professionals. For example, differences in the advisory fee structure may create the","page_number":128,"box":{"x":69,"y":498,"width":795,"height":11}},{"id":"17dbc96b-2aec-4aeb-adf7-02451da7e72b","block_type":"box","text":"appearance of actual or potential conflicts of interest because such differences could create pecuniary incentives for","page_number":128,"box":{"x":69,"y":513,"width":835,"height":11}},{"id":"50144da2-6a4f-47ee-87c1-605299eba768","block_type":"box","text":"BlackRock to favor one client account over another.","page_number":128,"box":{"x":70,"y":528,"width":363,"height":9}},{"id":"e4ce78ce-3d34-4d3e-a4a1-1f4e7497d31c","block_type":"box","text":"BlackRock owns or has an ownership interest in certain trading, portfolio management, operations and/or","page_number":128,"box":{"x":102,"y":551,"width":757,"height":11}},{"id":"f925440d-402c-4a59-a9fd-c86bd2bc492a","block_type":"box","text":"information systems used by Fund service providers. These systems are, or will be, used by a Fund service provider","page_number":128,"box":{"x":70,"y":566,"width":826,"height":11}},{"id":"1af3b4a7-1bd6-445f-8fe6-ab50b19bf90b","block_type":"box","text":"in connection with the provision of services to accounts managed by BlackRock and funds managed and sponsored","page_number":128,"box":{"x":70,"y":581,"width":822,"height":12}},{"id":"d37190aa-9981-4f81-91f7-56666367196f","block_type":"box","text":"by BlackRock, including the Funds, that engage the service provider (typically the custodian). A Fund’s service","page_number":128,"box":{"x":69,"y":597,"width":782,"height":11}},{"id":"bbe37502-15c8-41b9-9622-23da08582937","block_type":"box","text":"provider remunerates BlackRock for the use of the systems. A Fund service provider’s payments to BlackRock for the","page_number":128,"box":{"x":70,"y":612,"width":835,"height":11}},{"id":"0a1cf51a-cd92-4826-95c5-e7558de58057","block_type":"box","text":"use of these systems may enhance the profitability of BlackRock.","page_number":128,"box":{"x":69,"y":627,"width":465,"height":11}},{"id":"beb14111-d4e3-42df-9083-a14252c71fd5","block_type":"box","text":"BlackRock’s receipt of fees from a service provider in connection with the use of systems provided by BlackRock","page_number":128,"box":{"x":102,"y":649,"width":804,"height":12}},{"id":"20bddfd7-f642-4ee7-a856-7231efed3e63","block_type":"box","text":"may create an incentive for BlackRock to recommend that a Fund enter into or renew an arrangement with the service","page_number":128,"box":{"x":69,"y":664,"width":840,"height":12}},{"id":"42211e2c-6dbb-4c87-b1f3-911a905e6ca8","block_type":"box","text":"provider.","page_number":128,"box":{"x":70,"y":680,"width":58,"height":11}},{"id":"02cad506-1ff8-4c9d-a355-21d72cfb570f","block_type":"box","text":"In recognition of a BlackRock client’s overall relationship with BlackRock, BlackRock may offer special pricing","page_number":128,"box":{"x":102,"y":702,"width":778,"height":12}},{"id":"07f10e15-884c-4faf-9d86-88a0456e49cf","block_type":"box","text":"arrangements for certain services provided by BlackRock. Any such special pricing arrangements will not affect Fund","page_number":128,"box":{"x":69,"y":717,"width":831,"height":12}},{"id":"02649d17-e4df-4209-bc4d-8bd523906fb4","block_type":"box","text":"fees and expenses applicable to such client’s investment in a Fund.","page_number":128,"box":{"x":68,"y":732,"width":485,"height":11}},{"id":"18f264a8-903f-4a26-8eb3-1a5e7f16a9e6","block_type":"box","text":"Present and future activities of BlackRock and its directors, officers and employees, in addition to those","page_number":128,"box":{"x":102,"y":755,"width":742,"height":11}},{"id":"21092e75-3090-4736-b101-f53039462730","block_type":"box","text":"described in this section, may give rise to additional conflicts of interest.","page_number":128,"box":{"x":69,"y":770,"width":517,"height":12}},{"id":"1a17f8a7-d065-4bbc-b072-d562fc68110c","block_type":"box","text":"PURCHASE OF SHARES","page_number":128,"box":{"x":395,"y":800,"width":188,"height":10}},{"id":"15af8412-d1a5-4fc8-875f-47d20f01c960","block_type":"box","text":"Most BlackRock-advised open-end funds offer multiple classes of shares under a plan adopted under Rule 18f-3","page_number":128,"box":{"x":102,"y":823,"width":800,"height":11}},{"id":"94e15907-477a-479f-a7c8-b7586fc335b8","block_type":"box","text":"under the Investment Company Act. Investor A Shares are sold to investors choosing the initial sales charge","page_number":128,"box":{"x":69,"y":838,"width":771,"height":11}},{"id":"08eed86f-ed77-4fb3-ac2f-dcca5b5f4629","block_type":"box","text":"alternative, except that Investor A Shares of Index Funds (defined below) and BlackRock Short Obligations Fund are","page_number":128,"box":{"x":69,"y":853,"width":822,"height":11}},{"id":"fa286abc-d044-4668-a834-95a5c422ca17","block_type":"box","text":"generally not subject to an initial sales charge, and Investor C Shares are sold to investors choosing the deferred","page_number":128,"box":{"x":68,"y":868,"width":809,"height":11}},{"id":"e01b0426-b0cb-46f6-9fe0-2330150c7bad","block_type":"box","text":"sales charge alternative. Investor P Shares are available only to certain investors purchasing shares of Funds","page_number":128,"box":{"x":69,"y":883,"width":781,"height":11}},{"id":"db3acc8b-f794-4674-8651-9d7db342cf53","block_type":"box","text":"through registered representatives of an insurance company’s broker-dealer that has entered into an agreement with","page_number":128,"box":{"x":68,"y":898,"width":833,"height":11}},{"id":"416ab70c-a59d-4411-99a0-f12d56c4a3ac","block_type":"box","text":"II-97","page_number":128,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"8d391aa7-c807-498b-8a0d-3b12592459cf","block_type":"box","text":"NM0926U-5977317-128/232","page_number":128,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"e98937e5-cf07-4806-83ae-e44073d034b4","block_type":"box","text":"the Distributor to offer such shares. Institutional Shares are sold to certain eligible investors without a sales charge.","page_number":129,"box":{"x":68,"y":45,"width":833,"height":11}},{"id":"a3204f04-6864-4de9-87d5-f995aecac8b6","block_type":"box","text":"Certain Funds offer Class R Shares, which are available only to certain employer-sponsored retirement plans and are","page_number":129,"box":{"x":69,"y":60,"width":835,"height":11}},{"id":"18f224ef-a25e-4461-abc3-0f5c680a9b22","block_type":"box","text":"sold without a sales charge. Certain Funds offer Class G Shares, which are available only to investors on eligible","page_number":129,"box":{"x":69,"y":75,"width":804,"height":11}},{"id":"ac7c95e0-d3a4-49c6-8dc7-da196f653597","block_type":"box","text":"platforms, which are platforms where clients invest in the Fund through a single omnibus account in the name of a","page_number":129,"box":{"x":70,"y":90,"width":816,"height":11}},{"id":"0544a937-0cc1-4181-be47-3a56ce56ef7b","block_type":"box","text":"financial intermediary that meets an initial investment minimum of $2 billion. In addition, certain Funds offer Service","page_number":129,"box":{"x":68,"y":104,"width":835,"height":12}},{"id":"6c3956ea-9eee-4934-a546-83bc172304b1","block_type":"box","text":"Shares, BlackRock Shares and/or Class K Shares that are available only to certain eligible investors. Please see the","page_number":129,"box":{"x":69,"y":120,"width":834,"height":12}},{"id":"a19095fe-c079-4b85-82dd-2aee2425e953","block_type":"box","text":"appropriate Prospectus for your Fund to determine which classes are offered by your Fund and under what","page_number":129,"box":{"x":69,"y":135,"width":757,"height":11}},{"id":"e13b65ac-9444-4dfe-82b7-ba7539c5d5fc","block_type":"box","text":"circumstances. Each class has different exchange privileges. See “Shareholder Services — Exchange Privilege.”","page_number":129,"box":{"x":69,"y":150,"width":802,"height":12}},{"id":"a6d050fd-99f3-4a29-bc9d-faf5b2114493","block_type":"box","text":"The applicable offering price for purchase orders is based on the NAV of a Fund next determined after receipt of","page_number":129,"box":{"x":101,"y":173,"width":799,"height":11}},{"id":"465eed24-5505-490d-bae2-d50c6c96c524","block_type":"box","text":"the purchase order by a dealer or other financial intermediary (“Selling Dealer”) that has been authorized by the","page_number":129,"box":{"x":68,"y":188,"width":798,"height":12}},{"id":"a703d3cb-3c5d-4c0c-9f4a-4f07eafe4214","block_type":"box","text":"Distributor by contract to accept such orders. In addition, with respect to the affiliated underlying funds in which","page_number":129,"box":{"x":70,"y":203,"width":795,"height":12}},{"id":"2edcc7c6-fd74-4fa0-8e9a-cf072cc8a320","block_type":"box","text":"target date funds advised by BlackRock or its affiliates (“BlackRock Target Date Funds”) invest, the applicable","page_number":129,"box":{"x":68,"y":218,"width":786,"height":12}},{"id":"d87ca0b2-26d7-46a9-b004-c715c13edb92","block_type":"box","text":"offering price of each affiliated underlying fund is based on the NAV of such affiliated underlying fund next determined","page_number":129,"box":{"x":69,"y":234,"width":839,"height":11}},{"id":"cb19977d-2bf5-4810-8f53-e6373c687510","block_type":"box","text":"after a purchase order is received, or deemed to be received upon receipt by a Selling Dealer, by the BlackRock","page_number":129,"box":{"x":69,"y":249,"width":795,"height":11}},{"id":"52a444b5-9ceb-4035-9579-6cd5ed2125d4","block_type":"box","text":"Target Date Funds that allocate a portion of such purchase order to such affiliated underlying fund. As to purchase","page_number":129,"box":{"x":68,"y":264,"width":819,"height":11}},{"id":"4fdd1404-2fde-45ab-8384-462a1896df1d","block_type":"box","text":"orders received by Selling Dealers or BlackRock Target Date Funds prior to the close of business on the New York","page_number":129,"box":{"x":69,"y":279,"width":808,"height":11}},{"id":"88538c3d-6ef1-4423-92f4-022bdc08c59c","block_type":"box","text":"Stock Exchange (“NYSE”) (generally, the NYSE closes at 4:00 p.m. Eastern time), on the day the order is placed,","page_number":129,"box":{"x":69,"y":294,"width":803,"height":11}},{"id":"52cebedd-5421-40a3-bfe3-2db4ffcc0950","block_type":"box","text":"including orders received after the close of business on the previous day, the applicable offering price is based on","page_number":129,"box":{"x":70,"y":309,"width":812,"height":11}},{"id":"6b76eb44-beb5-4e4a-b32b-eb19d5766c98","block_type":"box","text":"the NAV determined as of the close of business on the NYSE on that day. If the purchase orders are not received by","page_number":129,"box":{"x":68,"y":324,"width":828,"height":11}},{"id":"1c2f8477-d74b-410a-a253-f935729b1087","block_type":"box","text":"the Selling Dealer or a BlackRock Target Date Fund before the close of business on the NYSE, such orders are","page_number":129,"box":{"x":68,"y":339,"width":788,"height":12}},{"id":"46df797b-e7ea-4fca-980d-28fd00b88f01","block_type":"box","text":"deemed received on the next business day. It is the responsibility of brokers to transmit purchase orders and","page_number":129,"box":{"x":69,"y":355,"width":779,"height":11}},{"id":"0f0f9114-26bc-4b49-be53-2cfbc9e8efd0","block_type":"box","text":"payment on a timely basis. Generally, if payment is not received within the period described in the Prospectuses, the","page_number":129,"box":{"x":70,"y":370,"width":830,"height":11}},{"id":"c4df9105-e0c3-4769-bca8-bfdda6260000","block_type":"box","text":"order will be canceled, notice thereof will be given, and the broker and its customers will be responsible for any loss","page_number":129,"box":{"x":69,"y":385,"width":828,"height":11}},{"id":"d6d8d40a-8e2e-48cf-991d-4580acc352d2","block_type":"box","text":"to the Fund or its shareholders. Orders of less than $500 may be mailed by a broker to the Transfer Agent.","page_number":129,"box":{"x":68,"y":399,"width":762,"height":12}},{"id":"f87ee0ee-d8fc-47fc-9afe-a8cfa0cc6cce","block_type":"box","text":"The minimum investment for the initial purchase of shares is set forth in the Prospectus for each Fund. The","page_number":129,"box":{"x":101,"y":423,"width":768,"height":11}},{"id":"6464046f-4ee6-4c3c-9adb-eedf970edd4c","block_type":"box","text":"minimum initial investment for employees of a Fund, a Fund’s Manager, Sub-Advisers or BRIL or employees of their","page_number":129,"box":{"x":69,"y":438,"width":819,"height":11}},{"id":"27949fa2-45c4-49d5-aeb8-525ee4a35841","block_type":"box","text":"affiliates is $100, unless payment is made through a payroll deduction program in which case the minimum","page_number":129,"box":{"x":69,"y":452,"width":769,"height":12}},{"id":"ce8bbeeb-57e1-4288-a8bd-4c3958ca22af","block_type":"box","text":"investment is $25.","page_number":129,"box":{"x":70,"y":467,"width":132,"height":11}},{"id":"5b77d951-7f3a-4a59-8004-67105cdd46c1","block_type":"box","text":"Each Fund has lower investment minimums for other categories of shareholders eligible to purchase Institutional","page_number":129,"box":{"x":102,"y":491,"width":802,"height":11}},{"id":"77fab7d3-a940-4771-920e-3c30d0e4ca2e","block_type":"box","text":"Shares, including selected fee-based programs. Each Fund may permit a lower initial investment for certain investors","page_number":129,"box":{"x":69,"y":506,"width":833,"height":11}},{"id":"1e13069d-3693-4a2c-a6fa-3344a39b9a9b","block_type":"box","text":"if their purchase, combined with purchases by other investors received together by the Fund, meets the minimum","page_number":129,"box":{"x":70,"y":521,"width":806,"height":11}},{"id":"79d26f0f-45b7-40ef-b828-ab1ae0bf02e2","block_type":"box","text":"investment requirement. Each Fund may reject any purchase order, modify or waive the minimum initial or","page_number":129,"box":{"x":70,"y":536,"width":751,"height":11}},{"id":"88b7bd8e-1962-4f47-ad97-eef296fa5924","block_type":"box","text":"subsequent investment requirements and suspend and resume the sale of any share class of any Fund at any time.","page_number":129,"box":{"x":69,"y":551,"width":826,"height":11}},{"id":"cd9d40d5-2431-4efc-a79b-bbf1300c7b2f","block_type":"box","text":"Financial intermediaries may, in connection with a change in account type or otherwise in accordance with a","page_number":129,"box":{"x":102,"y":574,"width":768,"height":11}},{"id":"48b7f149-d30d-40c0-b087-f589537aff82","block_type":"box","text":"financial intermediary’s policies and procedures, exchange shares of a Fund from one class of shares to another","page_number":129,"box":{"x":68,"y":589,"width":807,"height":11}},{"id":"e863e320-90c8-4338-a62c-badb3f4db1e1","block_type":"box","text":"class of shares of the same Fund, provided that the exchanged shares are not subject to a contingent deferred sales","page_number":129,"box":{"x":69,"y":604,"width":836,"height":11}},{"id":"1b739b7b-b62a-4182-9d7a-f096f7fff665","block_type":"box","text":"charge (“CDSC”) and that shareholders meet eligibility requirements of the new share class. Please speak to your","page_number":129,"box":{"x":69,"y":619,"width":814,"height":11}},{"id":"cd0ba6b7-dc0e-4e2d-9683-684991d5e62b","block_type":"box","text":"financial intermediary for information about specific policies and procedures applicable to your account.","page_number":129,"box":{"x":68,"y":634,"width":740,"height":11}},{"id":"aa022075-2ef9-4590-bd04-23fed593cdb4","block_type":"box","text":"Each Fund or the Distributor may suspend the continuous offering of the Fund’s shares of any class at any time","page_number":129,"box":{"x":102,"y":657,"width":795,"height":11}},{"id":"df9f74c1-49fa-4f77-8f53-75a27e0989ce","block_type":"box","text":"in response to conditions in the securities markets or otherwise and may resume offering the shares from time to","page_number":129,"box":{"x":70,"y":672,"width":813,"height":11}},{"id":"68c2769a-cf23-4687-9dd2-aeebc57c6c0a","block_type":"box","text":"time. Any order may be rejected by a Fund or the Distributor. Neither the Distributor, the securities dealers nor other","page_number":129,"box":{"x":68,"y":687,"width":827,"height":11}},{"id":"c614a161-1daf-4ec4-99a8-4f714e2a5621","block_type":"box","text":"financial intermediaries are permitted to withhold placing orders to benefit themselves by a price change.","page_number":129,"box":{"x":68,"y":702,"width":750,"height":12}},{"id":"37946c08-2f5c-442e-aedf-95ec65f1e16b","block_type":"box","text":"The term “purchase,” as used in the Prospectus and this SAI, refers to (i) a single purchase by an individual,","page_number":129,"box":{"x":101,"y":725,"width":776,"height":11}},{"id":"ccfe8d85-74af-436c-9dce-25020b2634c9","block_type":"box","text":"(ii) concurrent purchases by an individual, his or her spouse and their children purchasing shares for his, her or their","page_number":129,"box":{"x":69,"y":740,"width":831,"height":11}},{"id":"5af0e7bb-c76c-4443-8a52-7d83adc81609","block_type":"box","text":"own account, and (iii) single purchases by a trustee or other fiduciary purchasing shares for a single trust estate or","page_number":129,"box":{"x":69,"y":755,"width":822,"height":11}},{"id":"d5c0e048-aded-4ffd-98a2-bda1277e8466","block_type":"box","text":"single fiduciary account although more than one beneficiary may be involved. The term “purchase” also includes","page_number":129,"box":{"x":69,"y":770,"width":802,"height":12}},{"id":"b9712f35-915a-48b8-af43-6fa813f697de","block_type":"box","text":"purchases by any “company,” as that term is defined in the Investment Company Act, but does not include purchases","page_number":129,"box":{"x":70,"y":785,"width":839,"height":12}},{"id":"4e7e8648-4170-4ced-9cb4-14f890006a1e","block_type":"box","text":"by (i) any company that has not been in existence for at least six months, (ii) a company that has no purpose other","page_number":129,"box":{"x":69,"y":801,"width":819,"height":11}},{"id":"8525615e-c6b8-437a-a0e7-9c093741f59f","block_type":"box","text":"than the purchase of shares of a Fund or shares of other registered investment companies at a discount, or (iii) any","page_number":129,"box":{"x":68,"y":816,"width":827,"height":11}},{"id":"90c0515b-e196-4c80-9139-57394ef294f8","block_type":"box","text":"group of individuals whose sole organizational nexus is that its participants are credit cardholders of a company,","page_number":129,"box":{"x":68,"y":831,"width":803,"height":11}},{"id":"fd3052f9-c0fb-422a-ab5d-6bcc09884364","block_type":"box","text":"policyholders of an insurance company, customers of either a bank or broker-dealer or clients of an investment","page_number":129,"box":{"x":70,"y":846,"width":788,"height":11}},{"id":"92e4c0f8-9e8b-450f-91c2-d13bd9de6e95","block_type":"box","text":"adviser.","page_number":129,"box":{"x":69,"y":861,"width":53,"height":9}},{"id":"6109f80a-bf26-47b7-a595-7133ac980a08","block_type":"box","text":"With certain limited exceptions, the Funds are generally available only to investors residing in the United States","page_number":129,"box":{"x":101,"y":884,"width":795,"height":11}},{"id":"c03f5c6a-a8ad-4a0f-975c-a9ebce4b0993","block_type":"box","text":"and may not be distributed by a foreign financial intermediary. Under this policy, in order to accept new accounts or","page_number":129,"box":{"x":69,"y":899,"width":821,"height":11}},{"id":"01afed4c-4cfb-47bf-9798-a99e8ec3cc6c","block_type":"box","text":"II-98","page_number":129,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"0f4850bc-f072-4632-818c-5928de6183a0","block_type":"box","text":"NM0926U-5977317-129/232","page_number":129,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"772c0daf-e6f7-44a7-a87f-5f2904393f68","block_type":"box","text":"additional investments (including by way of exchange from another Fund) into existing accounts, a Fund generally","page_number":130,"box":{"x":69,"y":45,"width":803,"height":11}},{"id":"ebf9b54f-605c-4dae-aebc-f9f0f8429bcc","block_type":"box","text":"requires that (i) a shareholder that is a natural person be a U.S. citizen or resident alien, in each case residing within","page_number":130,"box":{"x":69,"y":60,"width":834,"height":11}},{"id":"49d56b26-02a3-456b-87b2-a17d611adc94","block_type":"box","text":"the United States or a U.S. territory (including APO/FPO/DPO addresses), and have a valid U.S. taxpayer","page_number":130,"box":{"x":68,"y":75,"width":747,"height":11}},{"id":"45283135-34b3-467f-ad9c-1df3347ff6c6","block_type":"box","text":"identification number, and (ii) a financial intermediary or a shareholder that is an entity be domiciled in the United","page_number":130,"box":{"x":70,"y":90,"width":809,"height":11}},{"id":"abd05005-0514-4a79-9262-09607869b6e7","block_type":"box","text":"States and have a valid U.S. taxpayer identification number or be domiciled in a U.S. territory and have a valid U.S.","page_number":130,"box":{"x":69,"y":105,"width":819,"height":11}},{"id":"31d58f15-40d4-4e01-be0f-7dcceea70538","block_type":"box","text":"taxpayer identification number or IRS Form W-8. Any existing account that is updated to reflect a non-U.S. address will","page_number":130,"box":{"x":68,"y":120,"width":840,"height":12}},{"id":"bfb62160-2733-4c24-a568-b8ff572e5ac9","block_type":"box","text":"also be restricted from making additional investments.","page_number":130,"box":{"x":69,"y":135,"width":388,"height":12}},{"id":"7be084b1-4788-48e4-8b78-852e89ead9be","block_type":"box","text":"In-Kind Purchases","page_number":130,"box":{"x":102,"y":158,"width":127,"height":9}},{"id":"75b13a6b-3ed9-406f-8378-970a9e7687e3","block_type":"box","text":". Payment for shares of a Fund may, at the discretion of BlackRock, be made in the form of","page_number":130,"box":{"x":230,"y":158,"width":649,"height":11}},{"id":"321a0188-fd02-419d-a3c7-f53d4086f8f8","block_type":"box","text":"securities that are permissible investments for the Fund and that meet the investment objective, policies and","page_number":130,"box":{"x":69,"y":173,"width":779,"height":11}},{"id":"12db3b19-2a0a-4714-983b-ce3b17505f1d","block_type":"box","text":"limitations of the Fund as described herein. In connection with an in-kind securities payment, the Fund may require,","page_number":130,"box":{"x":70,"y":188,"width":820,"height":11}},{"id":"7a1abf78-2e0e-4fe6-bca3-6772784de9f4","block_type":"box","text":"among other things, that the securities: (i) be valued on the day of purchase in accordance with the pricing methods","page_number":130,"box":{"x":69,"y":203,"width":827,"height":12}},{"id":"433bdfad-3576-4212-a59d-c04dfae4632d","block_type":"box","text":"used by the Fund; (ii) be accompanied by satisfactory assurance that the Fund will have good and marketable title to","page_number":130,"box":{"x":69,"y":218,"width":831,"height":12}},{"id":"dd1b7ef8-7049-41fa-8d64-f6f680c301cb","block_type":"box","text":"such securities; (iii) not be subject to any restrictions upon resale by the Fund; (iv) be in proper form for transfer to","page_number":130,"box":{"x":69,"y":234,"width":817,"height":11}},{"id":"f02f9b1d-cea7-493d-9ab4-0101e03f3701","block_type":"box","text":"the Fund; and (v) be accompanied by adequate information concerning the basis and other tax matters relating to the","page_number":130,"box":{"x":68,"y":249,"width":837,"height":11}},{"id":"d54961ec-64dc-4c6a-bc04-79474fb505d2","block_type":"box","text":"securities. All dividends, interest, subscription or other rights pertaining to such securities shall become the property","page_number":130,"box":{"x":69,"y":264,"width":835,"height":11}},{"id":"85f34617-e028-401e-9384-885c49d50f66","block_type":"box","text":"of the Fund engaged in the in-kind purchase transaction and must be delivered to the Fund by the investor upon","page_number":130,"box":{"x":69,"y":279,"width":795,"height":11}},{"id":"7c52e8c5-a457-4023-b22d-4ae69ebf33da","block_type":"box","text":"receipt from the issuer. Shares purchased in exchange for securities generally cannot be redeemed until the transfer","page_number":130,"box":{"x":69,"y":294,"width":833,"height":11}},{"id":"c433c3c7-bb85-4214-9a5a-b735050b8c82","block_type":"box","text":"has settled.","page_number":130,"box":{"x":69,"y":309,"width":83,"height":9}},{"id":"7fa01519-819c-4916-b43d-20cea16dbf29","block_type":"box","text":"Institutional Shares","page_number":130,"box":{"x":69,"y":340,"width":142,"height":8}},{"id":"4ca58cbe-7bc4-4beb-b897-80bac4d73233","block_type":"box","text":"Institutional Shares may be purchased at NAV without a sales charge. Only certain investors are eligible to","page_number":130,"box":{"x":102,"y":362,"width":759,"height":11}},{"id":"a32277a2-4c47-4191-a15b-c5cc6a67c81f","block_type":"box","text":"purchase Institutional Shares. Investors who are eligible to purchase Institutional Shares should purchase","page_number":130,"box":{"x":70,"y":377,"width":756,"height":12}},{"id":"8a3b75f5-05ca-4694-817a-1b4eb18c7d31","block_type":"box","text":"Institutional Shares because they are not subject to any sales charge and have lower ongoing expenses than","page_number":130,"box":{"x":70,"y":392,"width":775,"height":12}},{"id":"cbbf9c3d-0216-4cfd-bba1-50791d339d66","block_type":"box","text":"Investor A, Investor A1, Investor C, Investor P, Class R or Service Shares. A Fund may in its discretion waive or modify","page_number":130,"box":{"x":70,"y":407,"width":839,"height":12}},{"id":"721fe55c-2fe4-49f1-b9a3-b079bfb7da5f","block_type":"box","text":"any minimum investment amount, may reject any order for any class of shares and may suspend and resume the","page_number":130,"box":{"x":69,"y":423,"width":807,"height":11}},{"id":"bc5461e5-df7d-4f24-8f7f-30a26407af8c","block_type":"box","text":"sale of shares of any Fund at any time.","page_number":130,"box":{"x":69,"y":438,"width":276,"height":11}},{"id":"63fd2192-c17c-4d4e-963e-d159ee3a5262","block_type":"box","text":"Eligible Institutional Share Investors.","page_number":130,"box":{"x":102,"y":460,"width":259,"height":12}},{"id":"6a1948a0-d409-46f8-986a-4aa30573c361","block_type":"box","text":"Institutional Shares of the Funds may be purchased by customers of broker","page_number":130,"box":{"x":369,"y":460,"width":540,"height":12}},{"id":"83baeb64-b377-4b50-89b7-2655707ed159","block_type":"box","text":"dealers and agents that have established a servicing relationship with the Fund on behalf of their customers. These","page_number":130,"box":{"x":69,"y":475,"width":826,"height":12}},{"id":"58426868-3f8f-469b-adc7-a7cdbcfd6eb2","block_type":"box","text":"broker-dealers and agents may impose additional or different conditions on the purchase or redemption of Fund","page_number":130,"box":{"x":69,"y":491,"width":796,"height":11}},{"id":"fe179578-4e50-4a9b-81e9-97fd98c0fc2f","block_type":"box","text":"shares by their customers and may charge their customers transaction, account or other fees on the purchase and","page_number":130,"box":{"x":69,"y":506,"width":819,"height":11}},{"id":"24e84a4f-ba8f-472c-a719-37906712e606","block_type":"box","text":"redemption of Fund shares. Each broker-dealer or agent is responsible for transmitting to its customers a schedule of","page_number":130,"box":{"x":69,"y":521,"width":840,"height":11}},{"id":"d1482f2c-9250-43df-b3e4-3ea72e565243","block_type":"box","text":"any such fees and information regarding any additional or different conditions regarding purchases and redemptions.","page_number":130,"box":{"x":69,"y":536,"width":833,"height":11}},{"id":"b6a2af5f-a922-491c-97c1-ee2837c84e01","block_type":"box","text":"Shareholders who are customers of such broker-dealers or agents should consult them for information regarding","page_number":130,"box":{"x":69,"y":551,"width":802,"height":11}},{"id":"f81a00ca-24c8-4afb-82ac-c8f81700c7ff","block_type":"box","text":"these fees and conditions.","page_number":130,"box":{"x":68,"y":566,"width":189,"height":9}},{"id":"99b1ab79-8dda-488c-a7a4-2ce5dfc53992","block_type":"box","text":"Payment for Institutional Shares must normally be made in Federal funds or other funds immediately available by","page_number":130,"box":{"x":102,"y":589,"width":805,"height":11}},{"id":"85175276-20bc-4a29-8660-6775d644ddff","block_type":"box","text":"4 p.m. (Eastern time) on the first business day following receipt of the order. Payment may also, in the discretion of","page_number":130,"box":{"x":69,"y":604,"width":825,"height":11}},{"id":"c8c3c719-1c5b-41d0-a86c-00d63dca7e29","block_type":"box","text":"certain Funds, be made in the form of securities that are permissible investments for such Funds. If payment for a","page_number":130,"box":{"x":69,"y":619,"width":817,"height":11}},{"id":"f71f374d-45a0-431c-8bf5-06978c3ea622","block_type":"box","text":"purchase order is not received by the prescribed time, an investor may be liable for any resulting losses or expenses","page_number":130,"box":{"x":70,"y":634,"width":831,"height":12}},{"id":"03ca0565-be14-4e4e-881b-4a5ec24f672b","block_type":"box","text":"incurred by the Fund.","page_number":130,"box":{"x":70,"y":650,"width":147,"height":11}},{"id":"29746a63-21e6-4ab2-ba84-0009ceeaa6a8","block_type":"box","text":"Certain of the Funds offer Institutional Shares as described in each such Fund’s Prospectus. In addition, the","page_number":130,"box":{"x":102,"y":672,"width":774,"height":11}},{"id":"bf7b8c34-b970-4ad5-8dfe-a2abe64a2366","block_type":"box","text":"following investors may purchase Institutional Shares: employees, officers and directors/trustees of BlackRock, Inc.,","page_number":130,"box":{"x":68,"y":687,"width":834,"height":11}},{"id":"1b2ff52c-f68b-4215-a67a-3b1d56c522be","block_type":"box","text":"BlackRock Funds, Bank of America Corporation (“BofA Corp.”), Barclays PLC or their respective affiliates and","page_number":130,"box":{"x":70,"y":702,"width":773,"height":11}},{"id":"a4c41eca-df92-4211-8fe0-83eb5ea8e163","block_type":"box","text":"immediate family members of such persons, individuals and “Institutional Investors” with a minimum initial","page_number":130,"box":{"x":70,"y":717,"width":762,"height":12}},{"id":"5aa2e73e-ed7c-4fd6-9111-f7c6e0d51355","block_type":"box","text":"investment of $2 million who may purchase shares of a Fund through a financial intermediary that has entered into","page_number":130,"box":{"x":70,"y":732,"width":821,"height":12}},{"id":"f0b8af1e-2d57-40d1-a21f-29115dc72a14","block_type":"box","text":"an agreement with the Distributor to purchase such shares (“Institutional Investors” include, but are not limited to,","page_number":130,"box":{"x":69,"y":748,"width":819,"height":11}},{"id":"ebcee98f-7f6c-4987-b19f-8c7f0a969953","block_type":"box","text":"endowments, foundations, family offices, local, city, and state governmental institutions, corporations, and insurance","page_number":130,"box":{"x":69,"y":763,"width":836,"height":11}},{"id":"461957a3-0223-4d54-9115-56bbc77f72c8","block_type":"box","text":"company separate accounts); employer-sponsored retirement plans (which, for this purpose, do not include SEP IRAs,","page_number":130,"box":{"x":69,"y":778,"width":837,"height":11}},{"id":"b7baf55c-2e25-4ed3-83e8-94812169dfb1","block_type":"box","text":"SIMPLE IRAs or SARSEPs), state sponsored 529 college savings plans, collective trust funds, investment companies","page_number":130,"box":{"x":69,"y":793,"width":832,"height":11}},{"id":"1dd5dcfd-b14f-40ef-a871-8fe28dee43dd","block_type":"box","text":"or other pooled investment vehicles, unaffiliated thrifts and unaffiliated banks and trust companies, each of which","page_number":130,"box":{"x":69,"y":808,"width":815,"height":11}},{"id":"2684b2b3-511b-4f14-97eb-5bd0098ef9f9","block_type":"box","text":"may purchase shares of the Fund through a financial intermediary that has entered into an agreement with the","page_number":130,"box":{"x":69,"y":823,"width":789,"height":12}},{"id":"c7d01584-79f8-4717-bceb-2e70fe9e3f87","block_type":"box","text":"Distributor to purchase such shares; clients investing through a self-directed IRA brokerage account program","page_number":130,"box":{"x":70,"y":838,"width":772,"height":12}},{"id":"b483c616-61e2-48ff-bce1-f6ed43f7dce4","block_type":"box","text":"sponsored by a retirement plan record-keeper, provided that such program offers only mutual fund options and that","page_number":130,"box":{"x":69,"y":853,"width":822,"height":12}},{"id":"5ebcd1d3-5349-4a6a-879a-cf7a93e390dc","block_type":"box","text":"the program maintains an account with the Fund on an omnibus basis; clients of financial intermediaries that:","page_number":130,"box":{"x":68,"y":869,"width":783,"height":11}},{"id":"5277ec9a-ef0d-42b9-9282-a7d52ad96dd0","block_type":"box","text":"(i) charge such clients a fee for advisory, investment consulting, or similar services or (ii) have entered into an","page_number":130,"box":{"x":69,"y":884,"width":785,"height":11}},{"id":"73f4b7a6-c4d8-474e-9c71-ca1f10d20193","block_type":"box","text":"agreement with the Distributor to offer Institutional Shares through a no-load program or investment platform, in each","page_number":130,"box":{"x":69,"y":899,"width":838,"height":11}},{"id":"03522130-2aa6-4d68-8304-e089dfbb6b23","block_type":"box","text":"II-99","page_number":130,"box":{"x":473,"y":943,"width":32,"height":9}},{"id":"58863d32-6b62-4520-b30f-a9feb49f9d66","block_type":"box","text":"NM0926U-5977317-130/232","page_number":130,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"d18a8dd3-83ed-4b0a-8311-cf1a1c6061cd","block_type":"box","text":"case, with no minimum initial investment; clients investing through financial intermediaries that have entered into an","page_number":131,"box":{"x":69,"y":45,"width":831,"height":11}},{"id":"0587a136-9d27-4b71-afa7-965df180037f","block_type":"box","text":"agreement with the Distributor to offer such shares on a platform that charges a transaction based sales","page_number":131,"box":{"x":69,"y":60,"width":751,"height":11}},{"id":"4d32c442-73fe-4f89-a238-90728f3e00eb","block_type":"box","text":"commission outside of the Fund, with a minimum initial investment of $1,000; tax-qualified accounts for insurance","page_number":131,"box":{"x":69,"y":74,"width":817,"height":12}},{"id":"06be703f-277e-4beb-8a70-1c4aeadf233b","block_type":"box","text":"agents that are registered representatives of an insurance company’s broker-dealer that has entered into an","page_number":131,"box":{"x":69,"y":90,"width":773,"height":11}},{"id":"94c9e6a9-3cdf-48af-874f-7d7b12438497","block_type":"box","text":"agreement with the Distributor to offer Institutional Shares, and the family members of such persons, with a","page_number":131,"box":{"x":69,"y":105,"width":771,"height":11}},{"id":"f4f87472-026e-4c12-9a1e-2a2f147de7ab","block_type":"box","text":"minimum initial investment of $1,000; trust department clients of Bank of America, N.A. and its affiliates for whom","page_number":131,"box":{"x":69,"y":120,"width":822,"height":11}},{"id":"e57668dd-678c-4bf9-85b7-ec2ba4ce6743","block_type":"box","text":"they (i) act in a fiduciary capacity (excluding participant directed employee benefit plans), (ii) otherwise have","page_number":131,"box":{"x":68,"y":135,"width":771,"height":12}},{"id":"04946100-eabe-4ee6-b390-0204b8803165","block_type":"box","text":"investment discretion, or (iii) act as custodian for at least $2 million in assets; and holders of certain BofA Corp.","page_number":131,"box":{"x":70,"y":150,"width":801,"height":11}},{"id":"bb79cf06-ec6b-4f1a-a279-d482580594f9","block_type":"box","text":"sponsored unit investment trusts (UITs) who reinvest dividends received from such UITs in shares of a Fund.","page_number":131,"box":{"x":69,"y":166,"width":770,"height":11}},{"id":"c0566ce4-cccd-43ec-a1d8-90240d7c35df","block_type":"box","text":"Purchase Privileges of Cer tain Persons.","page_number":131,"box":{"x":102,"y":188,"width":280,"height":12}},{"id":"4860279c-a525-4ab9-923e-e3fc3cbde943","block_type":"box","text":"Employees, officers, directors/trustees of BlackRock, Inc., BlackRock","page_number":131,"box":{"x":389,"y":188,"width":496,"height":11}},{"id":"d93fa824-df46-4d93-ba0a-76e9b4fdee80","block_type":"box","text":"Funds, BofA Corp. or their respective affiliates; and any trust, pension, profit-sharing or other benefit plan for such","page_number":131,"box":{"x":70,"y":203,"width":812,"height":12}},{"id":"c0f92b28-aa69-47d4-9de9-02bb7894a8e4","block_type":"box","text":"persons may purchase Institutional Shares at lower investment minimums than stated in each Fund’s Prospectus. A","page_number":131,"box":{"x":70,"y":219,"width":828,"height":11}},{"id":"25f56594-e75f-4f65-9f0d-005ed198daac","block_type":"box","text":"Fund realizes economies of scale and reduction of sales-related expenses by virtue of the familiarity of these persons","page_number":131,"box":{"x":70,"y":234,"width":838,"height":11}},{"id":"3a8ce462-9edf-46cd-9ef4-3eadaddcd9c4","block_type":"box","text":"with the Fund. Employees, directors, and board members of other funds wishing to purchase shares of a Fund must","page_number":131,"box":{"x":68,"y":249,"width":826,"height":11}},{"id":"9f9e3e92-a8bf-4deb-99df-7c7de6bbbf68","block_type":"box","text":"satisfy the Fund’s suitability standards.","page_number":131,"box":{"x":69,"y":264,"width":279,"height":11}},{"id":"9593a75f-c182-4d88-bdf1-21899a5670a2","block_type":"box","text":"Initial Sales Charge Alternative — Investor A Shares","page_number":131,"box":{"x":69,"y":294,"width":382,"height":11}},{"id":"33d4fc57-b514-4b59-8f78-1d3e7aed50ac","block_type":"box","text":"Investors who prefer an initial sales charge alternative may elect to purchase Investor A Shares. Investor A1","page_number":131,"box":{"x":102,"y":317,"width":770,"height":11}},{"id":"da6caf13-6fd5-4929-8b7a-a7fd54009bc2","block_type":"box","text":"Shares are offered only (i) for purchase by certain employer-sponsored retirement plans and fee-based programs that","page_number":131,"box":{"x":69,"y":332,"width":837,"height":11}},{"id":"8273c27f-c5d6-4e60-ba62-a182a16e12d5","block_type":"box","text":"have been previously approved by certain Funds, and (ii) to certain investors who currently hold Investor A1 Shares","page_number":131,"box":{"x":69,"y":347,"width":819,"height":11}},{"id":"7b6ee53a-ec57-4f75-b34b-2a00b27c7c27","block_type":"box","text":"for dividend and capital gain reinvestment only. The Investor A1 initial sales charge does not apply to the transactions","page_number":131,"box":{"x":68,"y":362,"width":840,"height":11}},{"id":"bb56a09a-28ff-4e38-98e9-fd50a5b94cbf","block_type":"box","text":"described in (i) and (ii). For ease of reference, Investor A, Investor A1 and Investor P (discussed below) Shares are","page_number":131,"box":{"x":69,"y":377,"width":815,"height":11}},{"id":"bf1c1ce8-4d11-4f30-8561-1e9d70729f38","block_type":"box","text":"sometimes referred to herein as “front-end load shares.” Investor A Shares of Index Funds (defined below) and","page_number":131,"box":{"x":69,"y":392,"width":791,"height":11}},{"id":"b1e20385-7c99-4e82-a43e-dab578998090","block_type":"box","text":"BlackRock Short Obligations Fund generally are not subject to an initial sales charge or front-end load.","page_number":131,"box":{"x":70,"y":407,"width":727,"height":12}},{"id":"6aac5e0a-24e2-4f12-97ba-35babacfec92","block_type":"box","text":"Investors qualifying for significantly reduced initial sales charges may find the initial sales charge alternative","page_number":131,"box":{"x":102,"y":430,"width":770,"height":11}},{"id":"c458ad7a-add2-4487-b674-21b6318f4123","block_type":"box","text":"particularly attractive because similar sales charge reductions are not available with respect to the deferred sales","page_number":131,"box":{"x":70,"y":445,"width":812,"height":12}},{"id":"8adc48de-97e4-4708-80da-2d08211937df","block_type":"box","text":"charges imposed in connection with investments in Investor C Shares (sometimes referred to herein as “CDSC","page_number":131,"box":{"x":69,"y":460,"width":791,"height":12}},{"id":"182e0090-a2fa-4cad-8dab-0d812bff070d","block_type":"box","text":"shares”). Investors who do not qualify for reduced initial sales charges and who expect to maintain their investment","page_number":131,"box":{"x":69,"y":475,"width":826,"height":12}},{"id":"37f20cf1-bceb-4061-8146-7eb5f5efd29a","block_type":"box","text":"for an extended period of time also may elect to purchase Investor A Shares, because over time the accumulated","page_number":131,"box":{"x":68,"y":491,"width":808,"height":11}},{"id":"cc4b634c-7d55-4b39-83b7-c3260c20032a","block_type":"box","text":"ongoing service and distribution fees on CDSC shares may exceed the front-end load shares’ initial sales charge and","page_number":131,"box":{"x":69,"y":506,"width":834,"height":11}},{"id":"81f639e1-8ee6-4d8f-95d1-e8ad9088495c","block_type":"box","text":"service fee. Although some investors who previously purchased Institutional Shares may no longer be eligible to","page_number":131,"box":{"x":69,"y":521,"width":798,"height":11}},{"id":"0404037d-c12f-40ba-8511-cda3c8d0277f","block_type":"box","text":"purchase Institutional Shares of other Funds, those previously purchased Institutional Shares, together with all","page_number":131,"box":{"x":70,"y":536,"width":789,"height":11}},{"id":"a03d68eb-7855-41dc-9e5e-e222937c5948","block_type":"box","text":"BlackRock front-end load and CDSC share holdings, will count toward a right of accumulation that may qualify the","page_number":131,"box":{"x":70,"y":551,"width":805,"height":11}},{"id":"cb766582-1547-4c33-ad5a-9eb9e3622dcb","block_type":"box","text":"investor for a reduced initial sales charge on new initial sales charge purchases. In addition, the ongoing CDSC","page_number":131,"box":{"x":70,"y":566,"width":792,"height":11}},{"id":"03021a9f-90ad-4657-b0d4-71cf24a0f0b1","block_type":"box","text":"shares service and distribution fees will cause CDSC shares to have higher expense ratios, pay lower dividends and","page_number":131,"box":{"x":69,"y":581,"width":826,"height":12}},{"id":"b409c14a-1f8d-4a94-a26d-727d8c3b14bc","block_type":"box","text":"have lower total returns than the initial sales charge shares. The ongoing front-end load shares’ service fees will","page_number":131,"box":{"x":69,"y":596,"width":802,"height":12}},{"id":"db39e52b-e7cb-421d-ad45-1d4290996a45","block_type":"box","text":"cause Investor A, Investor A1, Investor P and Service Shares to have a higher expense ratio, pay lower dividends and","page_number":131,"box":{"x":69,"y":612,"width":834,"height":11}},{"id":"d91be805-218a-4a83-acc9-9c38981454bc","block_type":"box","text":"have a lower total return than Institutional Shares.","page_number":131,"box":{"x":69,"y":627,"width":358,"height":9}},{"id":"b4b4cdb1-5d4d-4df2-a79e-606f538e792f","block_type":"box","text":"See “Information on Sales Charges and Distribution Related Expenses” in Part I of each Fund’s SAI for","page_number":131,"box":{"x":102,"y":649,"width":734,"height":12}},{"id":"8abb644c-9081-454b-964e-93153dd57542","block_type":"box","text":"information about amounts paid to the Distributor in connection with Investor A and Investor A1 Shares for the","page_number":131,"box":{"x":70,"y":664,"width":785,"height":11}},{"id":"f61bad6f-8832-4e71-bdcf-42fdff4de1ce","block_type":"box","text":"periods indicated.","page_number":131,"box":{"x":70,"y":680,"width":124,"height":11}},{"id":"6b65b1b6-4db3-4bb1-9760-baeddc6df267","block_type":"box","text":"The Distributor may reallow discounts to selected securities dealers and other financial intermediaries and retain","page_number":131,"box":{"x":101,"y":702,"width":806,"height":11}},{"id":"de2aeac8-6d80-4c21-826b-7fe0980c8f68","block_type":"box","text":"the balance over such discounts. At times the Distributor may reallow the entire sales charge to such dealers. Since","page_number":131,"box":{"x":68,"y":718,"width":830,"height":11}},{"id":"d4f7538c-ecdf-46f1-a0c5-ce69e5a65ce8","block_type":"box","text":"securities dealers and other financial intermediaries selling front-end load shares of a Fund will receive a concession","page_number":131,"box":{"x":69,"y":732,"width":832,"height":12}},{"id":"d700818e-861f-448d-ae62-3edafdbf2713","block_type":"box","text":"equal to most of the sales charge, they may be deemed to be underwriters under the Securities Act.","page_number":131,"box":{"x":69,"y":748,"width":714,"height":11}},{"id":"9c3da22a-cad6-48e0-a949-bb8f447b6a3b","block_type":"box","text":"Initial Sales Charge — Investor P Shares","page_number":131,"box":{"x":69,"y":778,"width":297,"height":11}},{"id":"24befaf7-9552-423f-80ca-eaf134978143","block_type":"box","text":"Certain Funds offer Investor P Shares as described in each such Fund’s Prospectus, Investor P Shares are","page_number":131,"box":{"x":102,"y":801,"width":761,"height":11}},{"id":"78191ef0-c8bf-40c5-a944-61927aec9e7c","block_type":"box","text":"available for purchase only through registered representatives of an insurance company’s broker-dealer that has","page_number":131,"box":{"x":69,"y":816,"width":800,"height":11}},{"id":"0b042977-59d7-4044-b2eb-d07339ffc8af","block_type":"box","text":"entered into an agreement with the Distributor to offer such shares and are subject to an initial sales charge. The","page_number":131,"box":{"x":69,"y":831,"width":812,"height":11}},{"id":"8d6bf69e-156b-49d0-9cdd-a35cea554166","block_type":"box","text":"ongoing front-end load shares’ service fees will cause Investor P Shares to have a higher expense ratio, pay lower","page_number":131,"box":{"x":69,"y":846,"width":813,"height":11}},{"id":"01a58fa4-be4a-4d52-a58b-e0b2d35ed01c","block_type":"box","text":"dividends and have a lower total return than Investor A Shares of the same Fund.","page_number":131,"box":{"x":69,"y":861,"width":578,"height":9}},{"id":"fa55776f-e747-4d0b-8a78-9b2a403fc3c0","block_type":"box","text":"See “Information on Sales Charges and Distribution Related Expenses” in Part I of each Fund’s SAI for","page_number":131,"box":{"x":102,"y":884,"width":734,"height":11}},{"id":"72b9d58b-9a6a-4e05-ae72-42a3e546af37","block_type":"box","text":"information about amounts paid to the Distributor in connection with Investor P Shares for the periods indicated.","page_number":131,"box":{"x":70,"y":899,"width":800,"height":11}},{"id":"b58515ec-471d-47b2-99a4-a9a3e0c3f11b","block_type":"box","text":"II-100","page_number":131,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"07e3f1b1-fdee-41fb-aefc-447ff49bc686","block_type":"box","text":"NM0926U-5977317-131/232","page_number":131,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"3f5647ac-4b0a-4237-8020-6208876117c1","block_type":"box","text":"The Distributor may reallow discounts to selected securities dealers and other financial intermediaries and retain","page_number":132,"box":{"x":101,"y":45,"width":806,"height":11}},{"id":"5d4b3a4e-ebaa-479a-bdce-5c78bcc30d6d","block_type":"box","text":"the balance over such discounts. At times the Distributor may reallow the entire sales charge to such dealers. Since","page_number":132,"box":{"x":68,"y":60,"width":830,"height":11}},{"id":"c9a8ac37-9604-4d5c-adaf-2ec661e0f932","block_type":"box","text":"securities dealers and other financial intermediaries selling front-end load shares of a Fund will receive a concession","page_number":132,"box":{"x":69,"y":75,"width":832,"height":11}},{"id":"fd2a9076-5159-4c62-99ae-0fcb079966f9","block_type":"box","text":"equal to most of the sales charge, they may be deemed to be underwriters under the Securities Act.","page_number":132,"box":{"x":69,"y":90,"width":714,"height":11}},{"id":"cca6d968-131d-46f5-9bab-440e3d7bca05","block_type":"box","text":"Reduced Initial Sales Charges","page_number":132,"box":{"x":69,"y":120,"width":219,"height":11}},{"id":"ccb80fcd-cfd8-4141-9e8d-e4fe80c4ae2a","block_type":"box","text":"Certain investors may be eligible for a reduction in or waiver of a sales load due to the nature of the investors","page_number":132,"box":{"x":102,"y":143,"width":782,"height":11}},{"id":"4b58537b-624c-46af-8977-b6782db1f206","block_type":"box","text":"and/or the reduced sales efforts necessary to obtain their investments. Financial intermediaries may, in connection","page_number":132,"box":{"x":69,"y":158,"width":827,"height":11}},{"id":"8abc193a-b124-44d5-b844-b3681d732ea7","block_type":"box","text":"with a change in account type or otherwise in accordance with a financial intermediary’s policies and procedures,","page_number":132,"box":{"x":68,"y":173,"width":809,"height":11}},{"id":"b2e27ab1-8fdf-4451-9fbc-370ade79583a","block_type":"box","text":"exchange shares of a Fund from one class of shares to another class of shares of the same Fund provided that the","page_number":132,"box":{"x":69,"y":188,"width":823,"height":12}},{"id":"5955a6d7-078c-4f71-8942-fba7bbba3159","block_type":"box","text":"exchanged shares are not subject to a contingent deferred sales charge and that shareholders meet the eligibility","page_number":132,"box":{"x":69,"y":203,"width":812,"height":12}},{"id":"cd1214ab-3a00-402b-8f24-bbbc83cd6832","block_type":"box","text":"requirements of the new share class. Certain sales load reductions and waivers may be available to customers of","page_number":132,"box":{"x":69,"y":218,"width":813,"height":12}},{"id":"c6ea9b6d-9e40-4a0e-bf1b-5e8bd6278806","block_type":"box","text":"certain financial intermediaries, as described under “Intermediary-Defined Sales Charge Waiver Policies” in the","page_number":132,"box":{"x":69,"y":234,"width":793,"height":11}},{"id":"c4f790ee-c5f5-43bc-a241-6c2f1cdc0ebb","block_type":"box","text":"Fund’s Prospectus. Please speak to your financial intermediary for more information.","page_number":132,"box":{"x":70,"y":249,"width":603,"height":11}},{"id":"1f59e5b8-4d06-4fb6-af18-992345460d29","block_type":"box","text":"Reinvested Dividends.","page_number":132,"box":{"x":102,"y":272,"width":156,"height":8}},{"id":"740e1270-2a34-45b5-9160-2f7df03326f1","block_type":"box","text":"No sales charges are imposed upon shares issued as a result of the automatic","page_number":132,"box":{"x":265,"y":271,"width":566,"height":12}},{"id":"c9d81da6-47e4-448e-a14c-caeee166c629","block_type":"box","text":"reinvestment of dividends.","page_number":132,"box":{"x":69,"y":286,"width":186,"height":10}},{"id":"b3c4debf-1523-4205-9a7b-31c2792365fa","block_type":"box","text":"Right of Accumulation.","page_number":132,"box":{"x":102,"y":309,"width":158,"height":11}},{"id":"88b91862-686d-4b2e-86c4-ffaaa75db155","block_type":"box","text":"Investors have a “right of accumulation” under which any of the following may be","page_number":132,"box":{"x":267,"y":309,"width":574,"height":11}},{"id":"65de9ef1-c784-4971-8633-8a2ae766a47b","block_type":"box","text":"combined with the amount of the current purchase in determining whether an investor qualifies for a breakpoint and","page_number":132,"box":{"x":69,"y":324,"width":826,"height":12}},{"id":"ea6e05b7-2017-493b-90a9-b3b916def913","block_type":"box","text":"a reduced front-end sales charge: (i) the current value of an investor’s existing Investor A, Investor A1, Investor C,","page_number":132,"box":{"x":69,"y":339,"width":810,"height":12}},{"id":"1d6c0ba6-9b0f-49e3-b886-45d08f7361ef","block_type":"box","text":"Investor P, Institutional, Class K and Premier Shares in most BlackRock Funds, (ii) the current value of an investor’s","page_number":132,"box":{"x":70,"y":355,"width":825,"height":11}},{"id":"be63ec8c-89ac-4960-ba1f-8b8387c85705","block_type":"box","text":"existing shares of certain unlisted closed-end management investment companies sponsored and advised by","page_number":132,"box":{"x":69,"y":370,"width":780,"height":11}},{"id":"ac03ca27-8a29-416e-9fcc-00ee0ebc652f","block_type":"box","text":"BlackRock or its affiliates (“Eligible Unlisted BlackRock Closed-End Funds”) and (iii) the investment in the BlackRock","page_number":132,"box":{"x":70,"y":385,"width":828,"height":11}},{"id":"901d87b4-ad4f-4b3f-9e65-08edb0896615","block_type":"box","text":"CollegeAdvantage 529 Program by the investor or by or on behalf of the investor’s spouse and children. Financial","page_number":132,"box":{"x":69,"y":400,"width":804,"height":11}},{"id":"d101f866-a16e-4633-8a98-4abb14839175","block_type":"box","text":"intermediaries may value current holdings of their customers differently for purposes of determining whether an","page_number":132,"box":{"x":70,"y":415,"width":794,"height":11}},{"id":"3f7b9df1-7e4c-4400-9af7-de70bb733a90","block_type":"box","text":"investor qualifies for a breakpoint and a reduced front-end sales charge, although customers of the same financial","page_number":132,"box":{"x":70,"y":430,"width":814,"height":11}},{"id":"b065d79a-2792-4fa5-8a8f-b243fa5b2abe","block_type":"box","text":"intermediary will be treated similarly. In order to use this right, the investor must alert BlackRock to the existence of","page_number":132,"box":{"x":70,"y":445,"width":828,"height":12}},{"id":"59fcdab2-19cc-48cc-9864-400977a28e25","block_type":"box","text":"any previously purchased shares. Certain funds employ a “passive” management approach and attempt to match the","page_number":132,"box":{"x":69,"y":460,"width":838,"height":12}},{"id":"c8574749-5893-44c6-ab5f-70aac2bf5bc2","block_type":"box","text":"performance of a target index as closely as possible before the deduction of Fund expenses (“Index Funds”).","page_number":132,"box":{"x":70,"y":475,"width":776,"height":12}},{"id":"d63f7782-e42d-48bc-96a3-514a60c4d84a","block_type":"box","text":"Although Investor A Shares of Index Funds and BlackRock Short Obligations Fund generally are not subject to a sales","page_number":132,"box":{"x":68,"y":491,"width":835,"height":11}},{"id":"aa02b9ba-3192-46f1-8378-9657e82dda3e","block_type":"box","text":"charge, an investor’s existing Investor A, Investor A1, Investor C, Investor P, Institutional, Class K and Premier Shares","page_number":132,"box":{"x":69,"y":506,"width":839,"height":11}},{"id":"b9eed721-385c-4a34-880f-d037a2975753","block_type":"box","text":"in the Index Funds and BlackRock Short Obligations Fund may be combined with the amount of an investor’s current","page_number":132,"box":{"x":70,"y":521,"width":829,"height":11}},{"id":"72554ea9-53ee-4ae7-9826-4b9180ee6e54","block_type":"box","text":"purchase in determining whether an investor qualifies for a breakpoint and a reduced front-end sales charge.","page_number":132,"box":{"x":70,"y":536,"width":774,"height":11}},{"id":"d91bd948-0d2a-4cba-9564-c7398b06ac6e","block_type":"box","text":"Letter of Intent.","page_number":132,"box":{"x":102,"y":559,"width":109,"height":9}},{"id":"728f810e-25ac-475e-9abd-37acd416f0e4","block_type":"box","text":"An investor may qualify for a reduced front-end sales charge immediately by signing a “Letter of","page_number":132,"box":{"x":217,"y":559,"width":681,"height":11}},{"id":"019dcaae-c79a-4841-909a-5163610c8734","block_type":"box","text":"Intent” stating the investor’s intention to make one or more of the following investments within the next 13 months","page_number":132,"box":{"x":70,"y":574,"width":820,"height":11}},{"id":"cc0f995f-4856-4bea-a2a9-13f0d10a1236","block_type":"box","text":"which would, if bought all at once, qualify the investor for a reduced sales charge: (i) buy a specified amount of","page_number":132,"box":{"x":68,"y":589,"width":792,"height":11}},{"id":"efb16c78-9dde-49d6-afa9-97247b716fb7","block_type":"box","text":"Investor A, Investor C, Investor P, Institutional, Class K and/or Premier Shares, (ii) make an investment in one or","page_number":132,"box":{"x":70,"y":604,"width":802,"height":11}},{"id":"c586e0dc-ef1c-4a28-a466-b2f4b026d51e","block_type":"box","text":"more Eligible Unlisted BlackRock Closed-End Funds and/or (iii) make an investment through the BlackRock","page_number":132,"box":{"x":69,"y":619,"width":760,"height":11}},{"id":"87a5d04a-ecaa-4af6-98a6-c5ab4168f733","block_type":"box","text":"CollegeAdvantage 529 Program in one or more BlackRock Funds. The initial investment must meet the minimum","page_number":132,"box":{"x":69,"y":634,"width":800,"height":12}},{"id":"5eae4c51-2e14-4a0f-b31d-b5e92bd28df1","block_type":"box","text":"initial purchase requirement. The 13-month Letter of Intent period commences on the day that the Letter of Intent is","page_number":132,"box":{"x":70,"y":649,"width":826,"height":12}},{"id":"8ac21da0-556e-4220-a644-bd59842781bc","block_type":"box","text":"received by the Fund. The market value of current holdings in the BlackRock Funds (including Investor A, Investor C,","page_number":132,"box":{"x":69,"y":664,"width":822,"height":12}},{"id":"395a86ad-07d0-4e87-88c2-2581a08f44b2","block_type":"box","text":"Investor P, Institutional, Class K and Premier Shares, Eligible Unlisted BlackRock Closed-End Funds and the","page_number":132,"box":{"x":70,"y":680,"width":764,"height":11}},{"id":"b7a95d67-dfde-49b9-ac8c-678894525bb0","block_type":"box","text":"BlackRock CollegeAdvantage 529 Program Class A and Class C Units) as of the date of commencement that are","page_number":132,"box":{"x":70,"y":695,"width":800,"height":11}},{"id":"fb89f15e-83ea-4d30-b67b-70eb753eac34","block_type":"box","text":"eligible under the Right of Accumulation may be counted towards the sales charge reduction. The investor must notify","page_number":132,"box":{"x":69,"y":710,"width":838,"height":11}},{"id":"421bafa5-9f83-421a-a1e2-4fa3d0bea87e","block_type":"box","text":"the Fund of (i) any current holdings in the BlackRock Funds, Eligible Unlisted BlackRock Closed-End Funds and/or the","page_number":132,"box":{"x":68,"y":725,"width":835,"height":11}},{"id":"5d6008b0-df8d-4765-b894-9fb7845f9b1b","block_type":"box","text":"BlackRock CollegeAdvantage 529 Program that should be counted towards the sales charge reduction and (ii) any","page_number":132,"box":{"x":70,"y":740,"width":811,"height":11}},{"id":"fb555f0f-53e4-4202-aac3-c7d9b1e91f00","block_type":"box","text":"subsequent purchases that should be counted towards the Letter of Intent. During the term of the Letter of Intent,","page_number":132,"box":{"x":69,"y":755,"width":814,"height":11}},{"id":"03f4f8d8-3c73-4fcc-9fd2-876657089803","block_type":"box","text":"the Fund will hold Investor A Shares and/or Investor P Shares, as applicable, representing up to 5% of the indicated","page_number":132,"box":{"x":68,"y":770,"width":827,"height":12}},{"id":"9bf211c0-5ec4-4845-84af-d20d781cee9d","block_type":"box","text":"amount in an escrow account for payment of a higher sales load if the full amount indicated in the Letter of Intent is","page_number":132,"box":{"x":69,"y":785,"width":827,"height":12}},{"id":"bdda8e7d-9c02-4f2e-a592-01003064d637","block_type":"box","text":"not purchased. If the full amount indicated is not purchased within the 13-month period, and the investor does not","page_number":132,"box":{"x":69,"y":801,"width":817,"height":11}},{"id":"81468e62-4e4c-4f23-b1cc-0538ffd5351f","block_type":"box","text":"pay the higher sales load within 20 days, the Fund will redeem enough of the Investor A Shares and/or Investor P","page_number":132,"box":{"x":70,"y":816,"width":807,"height":11}},{"id":"1e3db872-47af-4d6f-97fa-7efb912a6bdd","block_type":"box","text":"Shares, as applicable, held in escrow to pay the difference.","page_number":132,"box":{"x":69,"y":831,"width":423,"height":11}},{"id":"fd9de1e5-1a2b-479f-8461-65c83e023ba6","block_type":"box","text":"Placement Fees.","page_number":132,"box":{"x":102,"y":854,"width":116,"height":8}},{"id":"f41454df-5157-48ee-8c0c-8a577e99fdc6","block_type":"box","text":"BlackRock may pay placement fees to dealers on purchases of Investor A and Investor P Shares of all Funds,","page_number":132,"box":{"x":102,"y":876,"width":777,"height":11}},{"id":"49059a45-1369-49df-98fc-9f72a7900618","block_type":"box","text":"which may depend on the policies, procedures and trading platforms of your financial intermediary.","page_number":132,"box":{"x":68,"y":891,"width":704,"height":12}},{"id":"21a2d24b-bfeb-4d60-812e-cc6f58d87df3","block_type":"box","text":"II-101","page_number":132,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"a45a4d62-a706-4c20-9000-ab4c11e44c73","block_type":"box","text":"NM0926U-5977317-132/232","page_number":132,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"25558e46-35e3-4a97-8a83-e03c734ea835","block_type":"box","text":"Except as noted below, these placement fees may be up to the following amounts for Investor A Shares:","page_number":133,"box":{"x":102,"y":45,"width":741,"height":11}},{"id":"48a63a01-2180-4eb7-a97f-b2fb9a9b9a99","block_type":"box","text":"$1 million but less than $3 million . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":72,"width":361,"height":10}},{"id":"809e7a57-fb63-40e8-ba41-a27091f81a68","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.00%","page_number":133,"box":{"x":535,"y":72,"width":288,"height":9}},{"id":"f31b10bc-d493-4688-8bbc-b98223ebdc40","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":87,"width":361,"height":10}},{"id":"9a10c6ec-d342-4f92-839d-c275e1251967","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":133,"box":{"x":535,"y":88,"width":288,"height":8}},{"id":"b9ceb85f-1304-4cf8-921a-5056451416b1","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":102,"width":345,"height":10}},{"id":"e01a4eea-9705-40ad-b8bd-702842014b34","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":133,"box":{"x":518,"y":103,"width":305,"height":9}},{"id":"bf1fab15-b1df-47f0-8fa9-3de96fe9ee68","block_type":"box","text":"With respect to Investor A Shares of BlackRock Global Allocation Fund, Inc., BlackRock Dynamic High Income","page_number":133,"box":{"x":101,"y":126,"width":776,"height":12}},{"id":"1b0ef6fe-115b-4f9d-9b0a-a1681159d63e","block_type":"box","text":"Portfolio (for shares purchased prior to July 1, 2020) and BlackRock Multi-Asset Income Portfolio (for shares","page_number":133,"box":{"x":69,"y":142,"width":774,"height":11}},{"id":"778a7f9c-a8b3-4361-9ac4-17a6502dea19","block_type":"box","text":"purchased prior to July 1, 2020) of BlackRock Funds II, BlackRock Credit Relative Value Fund of BlackRock Funds IV","page_number":133,"box":{"x":70,"y":157,"width":824,"height":11}},{"id":"6d213860-0cce-4583-a678-f905cd2a7b0d","block_type":"box","text":"and BlackRock Event Driven Equity Fund, the placement fees may be up to the following amounts:","page_number":133,"box":{"x":69,"y":172,"width":695,"height":11}},{"id":"a3ffabd8-d867-4799-8d18-9d90e70ae2c9","block_type":"box","text":"$250,000 but less than $3 million . . . . . . . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":199,"width":410,"height":11}},{"id":"6335d447-b0cc-4916-a72b-2b7cf09953d1","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . 1.00%","page_number":133,"box":{"x":583,"y":200,"width":240,"height":9}},{"id":"583d507e-77c8-4f54-bbb6-2263c07ad046","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":214,"width":361,"height":11}},{"id":"7a6b5a7b-e11b-4d5e-8394-c705d7b7de16","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":133,"box":{"x":535,"y":215,"width":288,"height":9}},{"id":"30ee5fc4-86ad-48f4-89d8-f813ed6e8d35","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":229,"width":345,"height":11}},{"id":"1842c510-64c3-44a0-9b7a-da7bca08092d","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":133,"box":{"x":518,"y":230,"width":305,"height":9}},{"id":"1e902773-4887-46d6-8715-ddf4ae865151","block_type":"box","text":"With respect to Investor A Shares of BlackRock Systematic Multi-Strategy Fund of BlackRock Funds IV, BlackRock","page_number":133,"box":{"x":101,"y":254,"width":806,"height":11}},{"id":"900d1bf5-3621-467b-b34b-366f01085dda","block_type":"box","text":"Advantage CoreAlpha Bond Fund of BlackRock Funds VI, BlackRock Tactical Opportunities Fund of BlackRock Funds","page_number":133,"box":{"x":68,"y":269,"width":821,"height":11}},{"id":"c72aa2be-b8af-4706-98ea-4c1d31be24b5","block_type":"box","text":"SM","page_number":133,"box":{"x":890,"y":269,"width":11,"height":5}},{"id":"a17f4ad8-876d-439a-8cde-2358fa26ebcc","block_type":"box","text":",","page_number":133,"box":{"x":903,"y":276,"width":2,"height":3}},{"id":"f7ac4b30-a0ed-4e0e-855e-b165b4808ae0","block_type":"box","text":"BlackRock High Yield Portfolio, BlackRock Core Bond Portfolio and BlackRock Sustainable High Yield Bond Fund of","page_number":133,"box":{"x":70,"y":284,"width":816,"height":11}},{"id":"e2e27cc2-8dc4-47ad-8c67-ad3b202849fd","block_type":"box","text":"BlackRock Funds V, BlackRock Securitized Income Fund of Managed Account Series II and BlackRock Strategic Global","page_number":133,"box":{"x":70,"y":299,"width":835,"height":11}},{"id":"ce75ff57-a155-47ac-894e-7226630ce04e","block_type":"box","text":"Bond Fund, Inc., the placement fees may be up to the following amounts:","page_number":133,"box":{"x":70,"y":314,"width":520,"height":12}},{"id":"3194ce38-e304-4240-afb1-d71592d5478a","block_type":"box","text":"$1 million but less than $3 million . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":341,"width":361,"height":11}},{"id":"b5f2bd46-a6a4-4cb4-b41b-48c682edede1","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.75%","page_number":133,"box":{"x":535,"y":342,"width":288,"height":9}},{"id":"5c75ec13-c9db-4fcd-936f-ac8c778c0c00","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":356,"width":361,"height":11}},{"id":"4283311c-4052-40e4-8475-8dc96d5f9bd1","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":133,"box":{"x":535,"y":357,"width":288,"height":9}},{"id":"38b3e040-4b18-4ce8-916c-653d55be5e52","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":372,"width":345,"height":10}},{"id":"cf6241f5-de0b-4023-9e6c-f0b5bb951c3b","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":133,"box":{"x":518,"y":372,"width":305,"height":9}},{"id":"1758b802-d029-4997-866b-a19926615d2a","block_type":"box","text":"With respect to Investor A Shares of BlackRock Mortgage-Backed Securities Fund and BlackRock Impact","page_number":133,"box":{"x":101,"y":396,"width":743,"height":11}},{"id":"9e883d39-730e-49d2-a8fc-5f040cb77fe8","block_type":"box","text":"Mortgage Fund of BlackRock Funds V, the placement fees may be up to the following amounts:","page_number":133,"box":{"x":70,"y":411,"width":674,"height":12}},{"id":"45bbf16f-20d1-4590-ab10-97186307516c","block_type":"box","text":"$1 million but less than $3 million . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":438,"width":361,"height":11}},{"id":"2f4dc381-3f3e-4e0d-b380-6ffd34ea1f3c","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":133,"box":{"x":535,"y":439,"width":288,"height":9}},{"id":"0b49fd73-2fbc-4f32-a5ca-5413450b880e","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":453,"width":361,"height":11}},{"id":"74a04042-6ff6-46ab-841c-e84c2947181b","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":133,"box":{"x":535,"y":454,"width":288,"height":9}},{"id":"a43c9890-c225-4bfd-808a-5e61279906ec","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":469,"width":345,"height":10}},{"id":"73c88920-5c66-440e-961e-423f589dcb5f","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.15%","page_number":133,"box":{"x":518,"y":469,"width":305,"height":9}},{"id":"ef6f5e72-463e-44fe-82cc-f083e84e4f6c","block_type":"box","text":"With respect to Investor A Shares of BlackRock Managed Income Fund of BlackRock Funds II, the placement fees","page_number":133,"box":{"x":101,"y":493,"width":808,"height":11}},{"id":"1d448160-190f-4975-8b62-461b616c1a02","block_type":"box","text":"may be up to the following amounts:","page_number":133,"box":{"x":69,"y":508,"width":257,"height":12}},{"id":"ce6c5ed6-fe1e-4edf-bd23-eeca9f78e3fb","block_type":"box","text":"$250,000 but less than $3 million . . . . . . . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":535,"width":410,"height":11}},{"id":"afdf49a3-275e-41e8-9374-232a3c5503b7","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":133,"box":{"x":583,"y":536,"width":240,"height":9}},{"id":"f1a01d72-d2af-451a-ae52-75b83ae966f9","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":550,"width":361,"height":11}},{"id":"eeb8fb85-dc55-40b8-9c18-4d2c44d0df0c","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":133,"box":{"x":535,"y":551,"width":288,"height":9}},{"id":"5a28ac01-9922-4c7e-a3e0-42d18983cbdc","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":566,"width":345,"height":10}},{"id":"69e0e3b1-5e3b-4a10-8b33-0a6e5d2f62b1","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.15%","page_number":133,"box":{"x":518,"y":566,"width":305,"height":9}},{"id":"a57d6a0a-539c-48cf-9ad6-b16bff1371fa","block_type":"box","text":"With respect to Investor A Shares of BlackRock Inflation Protected Bond Portfolio of BlackRock Funds V, the","page_number":133,"box":{"x":101,"y":590,"width":768,"height":11}},{"id":"28f4a8e0-1ea7-46b4-aa3f-d95aa00060e0","block_type":"box","text":"placement fees may be up to the following amounts:","page_number":133,"box":{"x":70,"y":605,"width":371,"height":12}},{"id":"9e0ccec3-fd3e-42d7-92cc-97aeb060432b","block_type":"box","text":"$1 million but less than $3 million . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":632,"width":361,"height":11}},{"id":"092425da-1efe-43cf-a34b-aff39f150e88","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.15%","page_number":133,"box":{"x":535,"y":633,"width":288,"height":9}},{"id":"52c74bc2-8bc4-4979-983b-c26394c21b5f","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":647,"width":361,"height":11}},{"id":"ebb90324-f931-443b-a482-0bbb77bd42a8","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.10%","page_number":133,"box":{"x":535,"y":648,"width":288,"height":9}},{"id":"096f367b-11a9-4f4e-bb72-5322b7f65dd7","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":663,"width":345,"height":10}},{"id":"978f00f0-fddf-40b1-9428-fe4af8b67198","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.05%","page_number":133,"box":{"x":518,"y":663,"width":305,"height":9}},{"id":"408b471f-7de4-4e8e-bb8d-e595881e1a24","block_type":"box","text":"With respect to Investor A Shares of BlackRock Low Duration Bond Portfolio, BlackRock Floating Rate Income","page_number":133,"box":{"x":101,"y":687,"width":778,"height":11}},{"id":"51a27b45-8843-4def-a8b9-ed659fc09b62","block_type":"box","text":"Portfolio, BlackRock Income Fund and BlackRock Strategic Income Opportunities Portfolio of BlackRock Funds V, the","page_number":133,"box":{"x":69,"y":702,"width":830,"height":12}},{"id":"266914d6-0b10-4cc7-b643-542e45e6f18e","block_type":"box","text":"placement fees may be up to the following amounts:","page_number":133,"box":{"x":70,"y":717,"width":371,"height":12}},{"id":"9e1175f3-f21e-41ab-8521-29179873dcfe","block_type":"box","text":"$500,000 but less than $3 million . . . . . . . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":744,"width":410,"height":12}},{"id":"2aa3c96c-6a3f-4c1f-89d7-a3d793e61227","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . 0.75%","page_number":133,"box":{"x":583,"y":745,"width":240,"height":9}},{"id":"f65ac5c0-5316-470f-9414-ade1dee5e35d","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":760,"width":361,"height":10}},{"id":"a8a8d142-4a73-46f6-a4e7-41a52242ba6d","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":133,"box":{"x":535,"y":760,"width":288,"height":9}},{"id":"c040675f-ccfe-4d98-936f-a7dfbd32476f","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":133,"box":{"x":167,"y":775,"width":345,"height":10}},{"id":"d4459de3-84d0-45ff-a3f3-36a353fd8756","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":133,"box":{"x":518,"y":775,"width":305,"height":9}},{"id":"70034dd7-4087-48fe-9fda-c660f5cac8e7","block_type":"box","text":"With respect to Investor A Shares of BlackRock Short Duration Muni Fund of BlackRock Municipal Bond Fund,","page_number":133,"box":{"x":101,"y":799,"width":779,"height":11}},{"id":"ac3990e9-a556-4229-ba9c-0bc9a2e77ce2","block_type":"box","text":"Inc. (for shares purchased prior to March 18, 2019), the placement fees may be up to the following amounts:","page_number":133,"box":{"x":70,"y":814,"width":780,"height":12}},{"id":"cc38dca1-c4b9-40d1-8554-d7931df8741f","block_type":"box","text":"$250,000 and above . . . .","page_number":133,"box":{"x":167,"y":841,"width":182,"height":12}},{"id":"4a2b0bce-55af-4195-b0b9-399b7c5188b6","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":133,"box":{"x":355,"y":842,"width":468,"height":9}},{"id":"7891ee47-f7c8-48b6-89f7-cea46817a90d","block_type":"box","text":"II-102","page_number":133,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"fd28e977-c3d4-4206-895e-10d9dbc5b6b2","block_type":"box","text":"NM0926U-5977317-133/232","page_number":133,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"116cd78b-72b1-4467-b048-83997ea47cdb","block_type":"box","text":"With respect to Investor A Shares of BlackRock Short Duration Muni Fund of BlackRock Municipal Bond Fund,","page_number":134,"box":{"x":101,"y":45,"width":779,"height":11}},{"id":"0a5de154-b9ae-43b6-b046-dd905ec83bf7","block_type":"box","text":"Inc. (for shares purchased on or after March 18, 2019 and prior to July 1, 2020), the placement fees may be up to","page_number":134,"box":{"x":70,"y":60,"width":819,"height":11}},{"id":"4ad7e299-46b4-4553-96a6-6842d57e6eb5","block_type":"box","text":"the following amounts:","page_number":134,"box":{"x":68,"y":75,"width":161,"height":11}},{"id":"383b9f02-f92c-48df-9544-2b9dbf1220a2","block_type":"box","text":"$100,000 and above . . . .","page_number":134,"box":{"x":167,"y":102,"width":182,"height":11}},{"id":"b918b717-fb5c-4fb4-957a-40a4752d4e32","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":134,"box":{"x":355,"y":103,"width":468,"height":9}},{"id":"6f6ec641-5c9e-4084-aa82-0aaa8e6caad9","block_type":"box","text":"With respect to Investor A Shares of BlackRock Short Duration Muni Fund of BlackRock Municipal Bond Fund,","page_number":134,"box":{"x":101,"y":126,"width":779,"height":11}},{"id":"770802ec-9de2-438a-be79-a6f343d5cb83","block_type":"box","text":"Inc. (for shares purchased on or after July 1, 2020), the placement fees may be up to the following amounts:","page_number":134,"box":{"x":70,"y":142,"width":775,"height":11}},{"id":"ed84e079-5adc-4fc4-a205-6bfc657462e0","block_type":"box","text":"$250,000 and above . . . .","page_number":134,"box":{"x":167,"y":169,"width":182,"height":11}},{"id":"cacf4930-075d-43ba-823f-ec908f29e06e","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":134,"box":{"x":355,"y":169,"width":468,"height":9}},{"id":"53897187-c984-4fb1-898b-3022c08f0034","block_type":"box","text":"With respect to Investor A Shares of BlackRock Strategic Municipal Opportunities Fund of BlackRock Municipal","page_number":134,"box":{"x":101,"y":193,"width":788,"height":12}},{"id":"b5f967bb-a3cf-43f8-9aef-7a1e4b83e693","block_type":"box","text":"Series Trust, BlackRock California Municipal Opportunities Fund of BlackRock California Municipal Series Trust,","page_number":134,"box":{"x":69,"y":208,"width":792,"height":11}},{"id":"51730c57-72a0-4a49-bb35-f36e5faa9c79","block_type":"box","text":"BlackRock New York Municipal Opportunities Fund, BlackRock New Jersey Municipal Bond Fund and BlackRock","page_number":134,"box":{"x":70,"y":224,"width":787,"height":11}},{"id":"763bbb71-d726-4752-be30-e7bd30f6a252","block_type":"box","text":"Pennsylvania Municipal Bond Fund of BlackRock Multi-State Municipal Series Trust and BlackRock National Municipal","page_number":134,"box":{"x":69,"y":239,"width":834,"height":11}},{"id":"00a7325a-05e0-4654-89b6-d06cf1e07e4c","block_type":"box","text":"Fund of BlackRock Municipal Bond Fund, Inc., the placement fees may be up to the following amounts:","page_number":134,"box":{"x":70,"y":254,"width":729,"height":11}},{"id":"99365662-4557-4b4a-a0c8-c73858ddf476","block_type":"box","text":"$250,000 but less than $4 million . . . . . . . . . . . . . . . . . . . .","page_number":134,"box":{"x":167,"y":281,"width":410,"height":11}},{"id":"f5144104-2aff-45f3-b3e1-f5f312ce0090","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . 1.00%","page_number":134,"box":{"x":583,"y":282,"width":240,"height":8}},{"id":"09e46015-2fc5-4b5a-b34e-9b768dbc479b","block_type":"box","text":"$4 million but less than $10 million . . . . . . . . . . . . .","page_number":134,"box":{"x":167,"y":296,"width":361,"height":10}},{"id":"2209d6de-bbde-4896-9053-0fa7821d1e3c","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":134,"box":{"x":535,"y":297,"width":288,"height":9}},{"id":"e97619f6-665e-4160-960e-da3726ff1c1c","block_type":"box","text":"$10 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":134,"box":{"x":167,"y":311,"width":345,"height":11}},{"id":"ce6f73eb-5208-497a-a690-891c6deefefc","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":134,"box":{"x":518,"y":312,"width":305,"height":9}},{"id":"b1adf15d-ee03-4dd3-a860-20c83c09f035","block_type":"box","text":"With respect to Investor A Shares of BlackRock Dynamic High Income Portfolio (for shares purchased on or after","page_number":134,"box":{"x":101,"y":336,"width":801,"height":11}},{"id":"15155a16-8a01-453b-9705-ae807d6c0f0c","block_type":"box","text":"July 1, 2020) and BlackRock Multi-Asset Income Portfolio (for shares purchased on or after July 1, 2020) of","page_number":134,"box":{"x":69,"y":351,"width":769,"height":11}},{"id":"e34983cd-9974-4029-b1e5-c886da48eb0d","block_type":"box","text":"BlackRock Funds II, BlackRock Total Return Fund of BlackRock Bond Fund, Inc. and BlackRock Balanced Fund, Inc.,","page_number":134,"box":{"x":70,"y":366,"width":818,"height":10}},{"id":"b7cdfa69-6c07-4895-bf61-64f88c8365ee","block_type":"box","text":"the placement fees may be up to the following amounts:","page_number":134,"box":{"x":68,"y":381,"width":401,"height":11}},{"id":"3587a5da-df1f-4b71-9205-f6816c4c5546","block_type":"box","text":"$250,000 but less than $3 million . . . . . . . . . . . . . . . . . . . .","page_number":134,"box":{"x":167,"y":408,"width":410,"height":11}},{"id":"9edae383-36f8-4f2c-b994-f46b2157a350","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . 0.75%","page_number":134,"box":{"x":583,"y":409,"width":240,"height":9}},{"id":"573aefc3-acbc-44f8-bcea-023efc52d226","block_type":"box","text":"$3 million but less than $15 million . . . . . . . . . . . . .","page_number":134,"box":{"x":167,"y":423,"width":361,"height":11}},{"id":"0142a05a-c19a-4a05-9e00-f97f652c4ccb","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.50%","page_number":134,"box":{"x":535,"y":424,"width":288,"height":9}},{"id":"37e9316f-aac8-402d-8fb9-fc1e16536235","block_type":"box","text":"$15 million and above . . . . . . . . . . . . . . . . . . . . . . .","page_number":134,"box":{"x":167,"y":438,"width":345,"height":11}},{"id":"9352ea03-57f8-41ff-ae6e-dcc13a7a8c26","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.25%","page_number":134,"box":{"x":518,"y":439,"width":305,"height":9}},{"id":"5c0534f3-e3bf-4f81-a7ef-bf0ad0974b49","block_type":"box","text":"With respect to Investor P Shares of BlackRock LifePath","page_number":134,"box":{"x":101,"y":463,"width":398,"height":11}},{"id":"df82b89f-4bbc-4ca1-9c29-f0d2734103d1","block_type":"box","text":"®","page_number":134,"box":{"x":500,"y":463,"width":6,"height":5}},{"id":"6cc230f7-db3b-4c68-b7d5-1eb20b498791","block_type":"box","text":"Index 2030 Fund, BlackRock LifePath","page_number":134,"box":{"x":513,"y":463,"width":264,"height":10}},{"id":"ad89d506-2515-450e-91c3-c33c73ffd395","block_type":"box","text":"®","page_number":134,"box":{"x":778,"y":463,"width":6,"height":5}},{"id":"f24bd006-4bd5-4d16-aaf0-4c36be1d5842","block_type":"box","text":"Index 2035","page_number":134,"box":{"x":791,"y":463,"width":79,"height":9}},{"id":"88c57d64-4484-48c3-872f-1048e54a78dd","block_type":"box","text":"Fund, BlackRock LifePath","page_number":134,"box":{"x":70,"y":478,"width":177,"height":11}},{"id":"4f5800d7-9233-48c1-8c2d-dd20046e2b26","block_type":"box","text":"®","page_number":134,"box":{"x":249,"y":478,"width":6,"height":5}},{"id":"095fac92-5316-4236-bae4-2c5b625d6bc0","block_type":"box","text":"Index 2040 Fund, BlackRock LifePath","page_number":134,"box":{"x":261,"y":478,"width":265,"height":11}},{"id":"41d4d462-e037-4248-81df-6f29097e1ffa","block_type":"box","text":"®","page_number":134,"box":{"x":527,"y":478,"width":6,"height":5}},{"id":"d0cb2d2c-d80c-4316-bbf7-25f178ba566a","block_type":"box","text":"Index 2045 Fund, BlackRock LifePath","page_number":134,"box":{"x":539,"y":478,"width":265,"height":11}},{"id":"a2114474-922c-46d6-b74d-0e0859da9bf3","block_type":"box","text":"®","page_number":134,"box":{"x":805,"y":478,"width":6,"height":5}},{"id":"da39535c-fe16-47d8-9065-fa0015ef438d","block_type":"box","text":"Index 2050","page_number":134,"box":{"x":817,"y":478,"width":80,"height":9}},{"id":"6b0f6124-d057-4f81-9c63-88c2dcf91c29","block_type":"box","text":"Fund, BlackRock LifePath","page_number":134,"box":{"x":70,"y":493,"width":177,"height":11}},{"id":"cc704e19-d82d-4ae7-be8f-6ec3df8c8ec3","block_type":"box","text":"®","page_number":134,"box":{"x":248,"y":494,"width":6,"height":4}},{"id":"af1be5c4-147f-4bfd-96d0-1a31869c27f8","block_type":"box","text":"Index 2055 Fund, BlackRock LifePath","page_number":134,"box":{"x":261,"y":493,"width":263,"height":11}},{"id":"a3e9ef17-ed14-473d-b60f-aedec070ac9d","block_type":"box","text":"®","page_number":134,"box":{"x":526,"y":494,"width":6,"height":4}},{"id":"30f554de-74d4-4d8d-9f34-5407102627d2","block_type":"box","text":"Index 2060 Fund, BlackRock LifePath","page_number":134,"box":{"x":538,"y":493,"width":264,"height":11}},{"id":"92ba015f-2c1b-4d76-8767-01817a66ff0c","block_type":"box","text":"®","page_number":134,"box":{"x":803,"y":494,"width":6,"height":4}},{"id":"4dfe5b0b-690e-4377-a702-76bcbb288cde","block_type":"box","text":"Index 2065","page_number":134,"box":{"x":815,"y":493,"width":80,"height":9}},{"id":"1cab5db5-504d-429d-94bf-e1bd12000d93","block_type":"box","text":"Fund, BlackRock LifePath","page_number":134,"box":{"x":70,"y":508,"width":177,"height":11}},{"id":"c364c1f3-8bc0-4d7b-a9c2-533f5c3394c9","block_type":"box","text":"®","page_number":134,"box":{"x":248,"y":509,"width":6,"height":4}},{"id":"06daa075-6853-4b03-bb54-d80b2fc40607","block_type":"box","text":"Index 2070 Fund and BlackRock LifePath","page_number":134,"box":{"x":261,"y":508,"width":290,"height":9}},{"id":"380b333b-8c13-4c62-9c92-d782cfb9a556","block_type":"box","text":"®","page_number":134,"box":{"x":552,"y":509,"width":6,"height":4}},{"id":"90f474e6-948e-4d56-850a-dd74413e1f18","block_type":"box","text":"Index Retirement Fund of BlackRock Funds III,","page_number":134,"box":{"x":564,"y":508,"width":324,"height":11}},{"id":"ad004d9a-0333-48b9-9cbc-22fd5012e85d","block_type":"box","text":"the placement fees may be up to the following amounts:","page_number":134,"box":{"x":68,"y":523,"width":401,"height":12}},{"id":"1cf7dea9-9cbf-49c7-8cdd-3402819c1139","block_type":"box","text":"$1,000,000 and above . . . . .","page_number":134,"box":{"x":167,"y":550,"width":206,"height":12}},{"id":"e4839808-b226-44c7-98d2-d672c6da146b","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.10%","page_number":134,"box":{"x":380,"y":551,"width":443,"height":9}},{"id":"20e32933-0961-4d9a-a8f9-00bbb9184218","block_type":"box","text":"With respect to Investor P Shares of iShares Municipal Bond Index Fund of BlackRock Funds","page_number":134,"box":{"x":101,"y":575,"width":657,"height":11}},{"id":"c058b850-a839-461a-93b4-515fb53fcec7","block_type":"box","text":"SM","page_number":134,"box":{"x":760,"y":575,"width":10,"height":5}},{"id":"a09674b2-3ea3-44dc-9db4-a9a5f44d33ec","block_type":"box","text":", the placement","page_number":134,"box":{"x":773,"y":575,"width":110,"height":11}},{"id":"1d24d776-3081-48e4-8389-3c2154cf0b32","block_type":"box","text":"fees may be up to the following amounts:","page_number":134,"box":{"x":68,"y":590,"width":294,"height":11}},{"id":"1ba41105-65da-467f-b4bb-1b14f742a412","block_type":"box","text":"$1,000,000 and above . . . . .","page_number":134,"box":{"x":167,"y":617,"width":206,"height":11}},{"id":"1ad69bde-40cf-426f-93a4-b53b40b29ddb","block_type":"box","text":". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.15%","page_number":134,"box":{"x":380,"y":618,"width":443,"height":9}},{"id":"101d6b2b-99cc-4a54-a7c5-5f334cc55a47","block_type":"box","text":"There are no placement fees for Investor P Shares of iShares MSCI EAFE International Index Fund and iShares","page_number":134,"box":{"x":101,"y":642,"width":787,"height":11}},{"id":"1f7a79c8-76c5-4ac0-81ca-4a30a0f2950e","block_type":"box","text":"Russell 2000 Small-Cap Index Fund of BlackRock Index Funds, Inc. and iShares S&P 500 Index Fund and iShares","page_number":134,"box":{"x":70,"y":657,"width":808,"height":11}},{"id":"ffad07b9-37b3-4a36-965f-7ec1702f1eca","block_type":"box","text":"U.S. Aggregate Bond Index Fund of BlackRock Funds III.","page_number":134,"box":{"x":70,"y":672,"width":393,"height":11}},{"id":"1b007ddc-7961-444a-b344-792ef0c12534","block_type":"box","text":"For the tables above, the placement fees indicated will apply up to the indicated breakpoint (so that, for","page_number":134,"box":{"x":102,"y":695,"width":740,"height":11}},{"id":"10afa923-4a5b-4024-b20b-e3e81330d500","block_type":"box","text":"example, a sale of $4 million worth of Investor A Shares of BlackRock Impact Mortgage Fund of BlackRock Funds V","page_number":134,"box":{"x":69,"y":709,"width":823,"height":12}},{"id":"355eb27b-ef0c-45f4-b99d-bf8986fa7ba0","block_type":"box","text":"will result in a placement fee of up to 0.50% on the first $3 million and a placement fee of 0.25% on the final","page_number":134,"box":{"x":68,"y":724,"width":780,"height":12}},{"id":"8547a3fb-70e4-4d5a-bbf8-89513107a99c","block_type":"box","text":"$1 million).","page_number":134,"box":{"x":69,"y":739,"width":79,"height":12}},{"id":"13298edf-fd7b-4fcf-b3d5-b3df857a0c34","block_type":"box","text":"Other.","page_number":134,"box":{"x":102,"y":763,"width":41,"height":9}},{"id":"6c8632c3-99b5-423f-9d70-30beddacb49b","block_type":"box","text":"The following persons may also buy Investor A or Investor P Shares without paying a sales charge:","page_number":134,"box":{"x":149,"y":763,"width":698,"height":11}},{"id":"eacffb3b-d08d-48be-985a-d3e8232fccea","block_type":"box","text":"(a) certain employer-sponsored retirement plans (for purposes of this waiver, employer-sponsored retirement plans do","page_number":134,"box":{"x":69,"y":778,"width":839,"height":11}},{"id":"7dc8a5a5-8baf-4ffe-bed3-8b8a09b6eeb0","block_type":"box","text":"not include SEP IRAs, SIMPLE IRAs or SARSEPs); (b) rollovers of current investments through certain employer","page_number":134,"box":{"x":69,"y":793,"width":790,"height":11}},{"id":"34facaae-25b7-4dbe-b006-5613253170c0","block_type":"box","text":"sponsored retirement plans provided the shares are transferred to Investor A or Investor P, as applicable, shares of","page_number":134,"box":{"x":69,"y":808,"width":825,"height":11}},{"id":"bc7c3979-f3a9-4899-ab32-5094db2c9329","block_type":"box","text":"the same or another BlackRock Fund as either a direct rollover, or subsequent to distribution, the rolled-over","page_number":134,"box":{"x":68,"y":823,"width":773,"height":11}},{"id":"45ea358c-a059-46b3-9cf2-86061103169f","block_type":"box","text":"proceeds are contributed to a BlackRock IRA through an account directly with the Fund; or purchases by IRA programs","page_number":134,"box":{"x":70,"y":839,"width":838,"height":11}},{"id":"a8a17d17-e128-44c6-b49a-f65c113b29c6","block_type":"box","text":"that are sponsored by financial intermediary firms provided the financial intermediary firm has entered into a Class A","page_number":134,"box":{"x":68,"y":853,"width":837,"height":12}},{"id":"0f11c659-406c-4daa-a26b-fa8deb0129d8","block_type":"box","text":"or Investor P NAV agreement, as applicable, with respect to such program with the Distributor; (c) insurance company","page_number":134,"box":{"x":69,"y":869,"width":836,"height":11}},{"id":"600f45b7-54d3-48b6-a655-1339114f2d25","block_type":"box","text":"separate accounts; (d) registered investment advisers, trust companies and bank trust departments exercising","page_number":134,"box":{"x":69,"y":884,"width":793,"height":11}},{"id":"2f6744ac-0be3-4ffa-ac96-40f41fed10ba","block_type":"box","text":"discretionary investment authority with respect to amounts to be invested in a Fund; (e) persons participating in a","page_number":134,"box":{"x":69,"y":899,"width":811,"height":11}},{"id":"d81eeeac-c5cd-4218-9f83-a5ef80bb6368","block_type":"box","text":"II-103","page_number":134,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"81d6dd3b-fe61-4113-8d55-4bc7e943b374","block_type":"box","text":"NM0926U-5977317-134/232","page_number":134,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"8c985050-1fab-4c41-9297-4cc7debeacd6","block_type":"box","text":"fee-based program (such as a wrap account) under which they pay advisory fees to a broker-dealer or other financial","page_number":135,"box":{"x":68,"y":45,"width":827,"height":11}},{"id":"9379a5d4-ee79-41a6-8124-90853a126f8c","block_type":"box","text":"institution; (f) financial intermediaries who have entered into an agreement with the Distributor and have been","page_number":135,"box":{"x":70,"y":60,"width":782,"height":11}},{"id":"00947fbf-bf11-4a2d-b409-fd99f55f6a14","block_type":"box","text":"approved by the Distributor to offer Fund shares to self-directed investment brokerage accounts that may or may not","page_number":135,"box":{"x":69,"y":75,"width":830,"height":11}},{"id":"8723d016-47a9-479e-abfb-b5c5a3397269","block_type":"box","text":"charge a transaction fee; (g) state sponsored 529 college savings plans and rollovers of such 529 plans into Roth","page_number":135,"box":{"x":69,"y":90,"width":815,"height":11}},{"id":"2e02dba1-48ca-41df-a2fb-4baa7a2df3bb","block_type":"box","text":"IRAs as permitted under the Internal Revenue Code; (h) with respect to Investor A Shares only, accounts opened","page_number":135,"box":{"x":70,"y":105,"width":799,"height":11}},{"id":"31128575-4cc0-4207-a31a-32201357d599","block_type":"box","text":"directly with a Fund that do not have a financial intermediary associated with the account; and (i) persons","page_number":135,"box":{"x":69,"y":120,"width":752,"height":11}},{"id":"06c44d46-4474-49da-b2ff-ea744a4e44af","block_type":"box","text":"involuntarily liquidated from a Fund, who within 60 days of liquidation buy new shares of another BlackRock Fund (but","page_number":135,"box":{"x":70,"y":135,"width":836,"height":11}},{"id":"345efec6-4663-4945-8232-d23aafd8f186","block_type":"box","text":"only up to the amount that was liquidated). The following persons associated with the Funds, the Fund’s Manager,","page_number":135,"box":{"x":69,"y":150,"width":812,"height":12}},{"id":"4ae71d1a-1888-442c-bebf-a47f41dea033","block_type":"box","text":"Sub-Advisers, Transfer Agent, Distributor, fund accounting agents, Barclays PLC and their affiliates may buy Investor A","page_number":135,"box":{"x":69,"y":166,"width":840,"height":11}},{"id":"d6e7fe8c-2924-4cad-b4ee-03fb99baf4bd","block_type":"box","text":"or Investor P Shares of each of the Funds without paying a sales charge to the extent permitted by these firms","page_number":135,"box":{"x":69,"y":181,"width":788,"height":11}},{"id":"ca26befa-5552-4fad-bde9-11865a29bca5","block_type":"box","text":"including: (a) officers, directors and partners; (b) employees and retirees; (c) employees or registered representatives","page_number":135,"box":{"x":70,"y":196,"width":838,"height":11}},{"id":"ec44e929-0525-43fd-9c19-30c9e40adfd6","block_type":"box","text":"of firms who have entered into selling agreements to distribute shares of BlackRock-advised funds; (d) immediate","page_number":135,"box":{"x":69,"y":211,"width":810,"height":11}},{"id":"b32111fb-38e7-4d98-b1bc-51ad26269503","block_type":"box","text":"family members of such persons (“immediate family members” shall be defined as the investor, the investor’s","page_number":135,"box":{"x":68,"y":226,"width":787,"height":11}},{"id":"c72e0a8c-f192-424a-854c-9c4ae7e7a662","block_type":"box","text":"spouse or domestic partner, children, parents and siblings); and (e) any trust, pension, profit-sharing or other benefit","page_number":135,"box":{"x":69,"y":241,"width":834,"height":11}},{"id":"b876cae2-28a8-4680-a785-66d657aa7761","block_type":"box","text":"plan for any of the persons set forth in (a) through (d). Investors who qualify for any of these exemptions from the","page_number":135,"box":{"x":70,"y":256,"width":808,"height":12}},{"id":"94169d52-4953-4fc9-90e2-ac38a511d1db","block_type":"box","text":"sales charge should purchase Investor A or Investor P Shares. In addition, a sales charge waiver may be available for","page_number":135,"box":{"x":69,"y":271,"width":837,"height":12}},{"id":"53c37d50-0bab-47cb-a03e-41d659e7ee01","block_type":"box","text":"investors exchanging Investor A Shares of one BlackRock Fund for Investor P Shares of another BlackRock Fund, or","page_number":135,"box":{"x":70,"y":286,"width":820,"height":12}},{"id":"10c9a805-3570-4113-a67b-42a39843ed14","block_type":"box","text":"exchanging Investor P Shares of one BlackRock Fund for Investor A Shares of another BlackRock Fund, through an","page_number":135,"box":{"x":69,"y":302,"width":813,"height":11}},{"id":"e273c515-a23e-490f-825f-f80f478ef7a3","block_type":"box","text":"intermediary-processed exchange, provided that the investor had previously paid a sales charge with respect to such","page_number":135,"box":{"x":70,"y":317,"width":831,"height":11}},{"id":"32d4f878-cd23-44b1-8d31-381d06a54675","block_type":"box","text":"shares. The availability of Investor A or Investor P Shares sales charge waivers may depend upon the policies,","page_number":135,"box":{"x":69,"y":332,"width":783,"height":11}},{"id":"627a710e-480e-401d-a931-4571b9e3e1c4","block_type":"box","text":"procedures and trading platforms of your financial intermediary; consult your financial adviser.","page_number":135,"box":{"x":70,"y":347,"width":668,"height":11}},{"id":"a94f6148-66dd-4e32-ac78-80c0f1ea7460","block_type":"box","text":"If you invest $1,000,000 ($250,000 for BlackRock Dynamic High Income Portfolio, BlackRock Multi-Asset","page_number":135,"box":{"x":102,"y":369,"width":754,"height":12}},{"id":"41ed37a6-77d4-4460-8961-eb91e148f218","block_type":"box","text":"Income Portfolio and BlackRock Managed Income Fund of BlackRock Funds II, BlackRock Credit Relative Value Fund","page_number":135,"box":{"x":70,"y":385,"width":823,"height":11}},{"id":"42282ca0-1580-40e5-acc9-2766bf4bbacf","block_type":"box","text":"of BlackRock Funds IV, BlackRock Total Return Fund of BlackRock Bond Fund, Inc., BlackRock Global Allocation Fund,","page_number":135,"box":{"x":69,"y":400,"width":833,"height":10}},{"id":"1261333a-58eb-42bd-a439-2db3c53b1361","block_type":"box","text":"Inc., BlackRock National Municipal Fund of BlackRock Municipal Bond Fund, Inc., BlackRock Short Duration Muni","page_number":135,"box":{"x":70,"y":415,"width":802,"height":11}},{"id":"33a148fa-e696-406b-ad11-2a58902b8892","block_type":"box","text":"Fund of BlackRock Municipal Bond Fund, Inc., BlackRock Strategic Municipal Opportunities Fund of BlackRock","page_number":135,"box":{"x":70,"y":430,"width":781,"height":11}},{"id":"de8fbae5-df21-48db-966a-d14eb580e075","block_type":"box","text":"Municipal Series Trust, BlackRock California Municipal Opportunities Fund of BlackRock California Municipal Series","page_number":135,"box":{"x":70,"y":445,"width":819,"height":11}},{"id":"2a16f904-5e13-4858-9727-cce9421ac0fe","block_type":"box","text":"Trust, BlackRock New York Municipal Opportunities Fund, BlackRock New Jersey Municipal Bond Fund and BlackRock","page_number":135,"box":{"x":68,"y":460,"width":835,"height":12}},{"id":"bc130421-1358-40a5-bcd2-520b026d87d4","block_type":"box","text":"Pennsylvania Municipal Bond Fund of BlackRock Multi-State Municipal Series Trust, BlackRock Event Driven Equity","page_number":135,"box":{"x":69,"y":475,"width":813,"height":12}},{"id":"da45be35-c687-4649-b11d-4889855c0cdf","block_type":"box","text":"Fund and BlackRock Balanced Fund, Inc., and $500,000 for BlackRock Low Duration Bond Portfolio, BlackRock","page_number":135,"box":{"x":70,"y":490,"width":792,"height":11}},{"id":"04c40845-9b25-42d2-b1bd-36f9906ef25a","block_type":"box","text":"Floating Rate Income Portfolio, BlackRock Income Fund and BlackRock Strategic Income Opportunities Portfolio of","page_number":135,"box":{"x":70,"y":506,"width":813,"height":11}},{"id":"1fab13d6-395e-441c-b5b1-3dd467279a1f","block_type":"box","text":"BlackRock Funds V) or more in Investor A or Investor P Shares, as applicable, you may not pay an initial sales charge.","page_number":135,"box":{"x":70,"y":521,"width":837,"height":11}},{"id":"e6a077dc-6a05-4d5a-bd18-ed882fb6c910","block_type":"box","text":"However, if you redeem your Investor A or Investor P Shares, as applicable, within 18 months after purchase (a","page_number":135,"box":{"x":70,"y":536,"width":790,"height":11}},{"id":"a130cbf9-b794-42fe-800d-4c0216bef25d","block_type":"box","text":"shorter holding period may apply depending on the Fund), you may be charged a deferred sales charge.","page_number":135,"box":{"x":69,"y":551,"width":736,"height":11}},{"id":"bacef144-4343-4b95-9bf3-499fb9d60ddb","block_type":"box","text":"A deferred sales charge of up to 1.00% may apply to certain redemptions of Investor A Shares of the Index","page_number":135,"box":{"x":101,"y":574,"width":763,"height":11}},{"id":"00edf392-03d7-470f-a381-528bac85ca11","block_type":"box","text":"Funds and BlackRock Short Obligations Fund purchased in an exchange transaction for Investor A Shares of a","page_number":135,"box":{"x":70,"y":589,"width":782,"height":11}},{"id":"9bd480c8-2868-4564-b63e-2f72096df491","block_type":"box","text":"portfolio advised by BlackRock or its affiliates where no initial sales charge was paid at the time of purchase of such","page_number":135,"box":{"x":70,"y":604,"width":832,"height":11}},{"id":"30e97800-d5fe-415c-b8e8-fc37cd3a01c8","block_type":"box","text":"fund (an “Investor A Load-Waived BlackRock Portfolio”) as part of an investment of $1,000,000 (lesser amounts may","page_number":135,"box":{"x":68,"y":618,"width":839,"height":12}},{"id":"9f24f1c4-2767-4e48-a748-c5d95c611025","block_type":"box","text":"apply depending on the Investor A Load-Waived BlackRock Portfolio) or more. The Investor A Shares deferred sales","page_number":135,"box":{"x":69,"y":634,"width":817,"height":12}},{"id":"d4d3ad77-1886-4403-969b-f1eb27900358","block_type":"box","text":"charge is only charged upon redemptions of Investor A Shares within 18 months after you originally acquired such","page_number":135,"box":{"x":69,"y":649,"width":811,"height":12}},{"id":"53516f6d-c3e1-4506-9829-03b2d21caff5","block_type":"box","text":"Investor A Shares of the Investor A Load-Waived BlackRock Portfolio (a shorter holding period may apply depending","page_number":135,"box":{"x":70,"y":664,"width":818,"height":12}},{"id":"cce1a88b-39f2-4531-a426-1bf5e08e7d0e","block_type":"box","text":"on the Investor A Load-Waived BlackRock Portfolio), unless you qualify for a waiver. There is no deferred sales charge","page_number":135,"box":{"x":69,"y":680,"width":836,"height":11}},{"id":"4b337ee7-db8d-4b06-918f-031659bc0218","block_type":"box","text":"charged on redemptions if you have owned your Investor A Shares for more than 18 months (or for a shorter holding","page_number":135,"box":{"x":69,"y":695,"width":830,"height":11}},{"id":"d9c50bea-d19f-41dd-b09e-7777b9b3d3de","block_type":"box","text":"period, as applicable) (as measured from your original purchase of Investor A Shares that you exchanged into","page_number":135,"box":{"x":70,"y":710,"width":778,"height":11}},{"id":"83ccae37-e245-421d-bbb6-bc3efbf8704b","block_type":"box","text":"Investor A Shares of the Index Fund or BlackRock Short Obligations Fund).","page_number":135,"box":{"x":70,"y":725,"width":526,"height":11}},{"id":"f3e74d02-f444-4109-8017-877f0425c778","block_type":"box","text":"The deferred sales charge on Investor A or Investor P Shares, as applicable, is not charged in connection with:","page_number":135,"box":{"x":101,"y":748,"width":788,"height":11}},{"id":"2a4aabbe-1e14-4038-b066-238f53bcf0cd","block_type":"box","text":"(a) redemptions of Investor A or Investor P Shares purchased through certain employer-sponsored retirement plans","page_number":135,"box":{"x":69,"y":763,"width":819,"height":11}},{"id":"e7bb415e-3ab2-4dd4-aa27-3483307613f1","block_type":"box","text":"and rollovers of current investments in a Fund through such plans; (b) exchanges described in “Exchange Privilege”","page_number":135,"box":{"x":69,"y":778,"width":820,"height":11}},{"id":"3fba5ef6-a211-4bc6-9fa4-33d825f0835c","block_type":"box","text":"below; (c) redemptions made in connection with minimum required distributions from IRA and 403(b)(7) accounts due","page_number":135,"box":{"x":69,"y":793,"width":837,"height":11}},{"id":"807b6abf-2063-4bf4-85e0-8bdd52498171","block_type":"box","text":"to the shareholder reaching the applicable age triggering such distributions; (d) redemptions made with respect to","page_number":135,"box":{"x":68,"y":808,"width":812,"height":11}},{"id":"878e2289-1dc9-4ecd-97c9-d6e42f3594d5","block_type":"box","text":"certain retirement plans sponsored by a Fund, BlackRock or its affiliates; (e) redemptions (i) within one year of a","page_number":135,"box":{"x":69,"y":823,"width":803,"height":11}},{"id":"1256fc27-91e9-4acc-94e9-252bf89e6ccf","block_type":"box","text":"shareholder’s death or, if later, the receipt of a certified probate settlement (including in connection with the","page_number":135,"box":{"x":69,"y":838,"width":772,"height":12}},{"id":"c7bbb5c5-2009-484d-90df-64495b762e3a","block_type":"box","text":"distribution of account assets to a beneficiary of the decedent) or (ii) in connection with a shareholder’s disability (as","page_number":135,"box":{"x":69,"y":853,"width":835,"height":12}},{"id":"9ecffeb6-6b92-44c5-bfe1-46f91ed60d3f","block_type":"box","text":"defined in the Code) subsequent to the purchase of Investor A or Investor P Shares; (f) involuntary redemptions of","page_number":135,"box":{"x":69,"y":869,"width":814,"height":11}},{"id":"8274698c-a4d4-4165-80fc-e822f78e1ca8","block_type":"box","text":"Investor A or Investor P Shares in accounts with low balances; (g) certain redemptions made pursuant to the","page_number":135,"box":{"x":70,"y":884,"width":772,"height":11}},{"id":"a3bf0f8b-0127-4821-a402-d32ab0ca6fc2","block_type":"box","text":"Systematic Withdrawal Plan (described below); (h) redemptions related to the payment of BNY Mellon Investment","page_number":135,"box":{"x":69,"y":899,"width":805,"height":11}},{"id":"231a939d-ca6d-4754-8ec1-c778452b6b26","block_type":"box","text":"II-104","page_number":135,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"20258b14-c955-46d4-8efc-4cdae439b2c3","block_type":"box","text":"NM0926U-5977317-135/232","page_number":135,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"7b3ead47-ac79-4fa3-85da-55d5ddd9c80b","block_type":"box","text":"Servicing Trust Company custodial IRA fees; and (i) redemptions when a shareholder can demonstrate hardship, in","page_number":136,"box":{"x":69,"y":45,"width":817,"height":11}},{"id":"645a4d9a-537f-49da-bddd-ffb73cc9973e","block_type":"box","text":"the absolute discretion of a Fund.","page_number":136,"box":{"x":68,"y":60,"width":239,"height":9}},{"id":"05316d63-01fc-4ce4-9f6c-46c6ecaa5d9c","block_type":"box","text":"With respect to certain employer-sponsored retirement plans, if a dealer waives its right to receive a placement","page_number":136,"box":{"x":101,"y":82,"width":794,"height":12}},{"id":"6c4efb96-232c-499e-9221-029be13fb83b","block_type":"box","text":"fee, the Fund may, at its own discretion, waive the CDSC related to purchases of $1,000,000 ($250,000 for","page_number":136,"box":{"x":68,"y":97,"width":776,"height":12}},{"id":"904159ac-0241-4e63-bb2f-5e4fd20aa434","block_type":"box","text":"BlackRock Dynamic High Income Portfolio, BlackRock Multi-Asset Income Portfolio and BlackRock Managed Income","page_number":136,"box":{"x":70,"y":113,"width":821,"height":11}},{"id":"fa0f86bd-655f-46ec-8c80-f16cd0c168b8","block_type":"box","text":"Fund of BlackRock Funds II, BlackRock Credit Relative Value Fund of BlackRock Funds IV, BlackRock Total Return","page_number":136,"box":{"x":70,"y":128,"width":800,"height":10}},{"id":"0d88a873-9680-4d7f-b38a-c1dd70a15aba","block_type":"box","text":"Fund of BlackRock Bond Fund, Inc., BlackRock Global Allocation Fund, Inc., BlackRock National Municipal Fund of","page_number":136,"box":{"x":70,"y":143,"width":806,"height":11}},{"id":"7bafae89-f9d7-4a99-acf1-3a9a0095ee11","block_type":"box","text":"BlackRock Municipal Bond Fund, Inc., BlackRock Short Duration Muni Fund of BlackRock Municipal Bond Fund, Inc.,","page_number":136,"box":{"x":70,"y":158,"width":823,"height":11}},{"id":"8af86027-fe8f-4d4d-b65c-783673e7605b","block_type":"box","text":"BlackRock Strategic Municipal Opportunities Fund of BlackRock Municipal Series Trust, BlackRock California","page_number":136,"box":{"x":70,"y":173,"width":770,"height":11}},{"id":"6ebfc418-c5dc-4193-bdc5-3bff2649eae1","block_type":"box","text":"Municipal Opportunities Fund of BlackRock California Municipal Series Trust, BlackRock New York Municipal","page_number":136,"box":{"x":70,"y":188,"width":766,"height":11}},{"id":"7147f5a4-8a5c-4110-9188-f5e2c0db42d3","block_type":"box","text":"Opportunities Fund, BlackRock New Jersey Municipal Bond Fund and BlackRock Pennsylvania Municipal Bond Fund of","page_number":136,"box":{"x":69,"y":203,"width":837,"height":12}},{"id":"8eec882d-893b-4018-b299-a2ac01bcdb77","block_type":"box","text":"BlackRock Multi-State Municipal Series Trust, BlackRock Event Driven Equity Fund and BlackRock Balanced Fund,","page_number":136,"box":{"x":70,"y":219,"width":805,"height":11}},{"id":"679854b1-1bc0-42d4-b3c5-b8156dab748e","block_type":"box","text":"Inc., and $500,000 for BlackRock Low Duration Bond Portfolio, BlackRock Floating Rate Income Portfolio, BlackRock","page_number":136,"box":{"x":70,"y":233,"width":832,"height":12}},{"id":"1c5c5ef5-c00f-46b5-bdcc-82ffc47947cf","block_type":"box","text":"Income Fund and BlackRock Strategic Income Opportunities Portfolio of BlackRock Funds V) or more of Investor A or","page_number":136,"box":{"x":70,"y":249,"width":828,"height":11}},{"id":"6786ccc9-433c-494c-808a-85b9078a4d98","block_type":"box","text":"Investor P Shares. This may depend upon the policies, procedures and trading platforms of your financial","page_number":136,"box":{"x":70,"y":264,"width":746,"height":11}},{"id":"96a5a2a8-dce4-44c2-8df5-8249dbf7aeff","block_type":"box","text":"intermediary; consult your financial adviser.","page_number":136,"box":{"x":70,"y":279,"width":307,"height":11}},{"id":"122d2483-c7f3-4cde-b882-d4efe0e8c69e","block_type":"box","text":"Investor A and Investor P Shares are also available at NAV to investors that, for regulatory reasons, are required","page_number":136,"box":{"x":102,"y":302,"width":799,"height":11}},{"id":"da55d56d-05c7-44eb-8a7b-0c24900a6b41","block_type":"box","text":"to transfer investment positions from a foreign registered investment company advised by BlackRock or its affiliates","page_number":136,"box":{"x":68,"y":317,"width":829,"height":11}},{"id":"d0e96dca-241a-4a29-b1b4-068729d1a2b1","block_type":"box","text":"to a U.S. registered BlackRock-advised fund.","page_number":136,"box":{"x":68,"y":332,"width":317,"height":11}},{"id":"9f970947-3519-4a59-8b02-e9827b27189b","block_type":"box","text":"Acquisition of Cer tain Investment Companies.","page_number":136,"box":{"x":101,"y":355,"width":326,"height":11}},{"id":"540bc507-92fe-40ef-b828-9377f68517ca","block_type":"box","text":"Investor A and Investor P Shares may be offered at NAV in","page_number":136,"box":{"x":434,"y":355,"width":413,"height":11}},{"id":"225e152a-867e-4159-85d1-5079c5656e25","block_type":"box","text":"connection with the acquisition of the assets of, or merger or consolidation with, a personal holding company or a","page_number":136,"box":{"x":69,"y":370,"width":811,"height":11}},{"id":"8a962d7f-cc9c-4858-959d-755de63e8c97","block_type":"box","text":"public or private investment company.","page_number":136,"box":{"x":70,"y":385,"width":266,"height":11}},{"id":"135402b3-4d70-4f84-92ec-258c123e2a07","block_type":"box","text":"Purchases Through Cer tain Financial Intermediaries.","page_number":136,"box":{"x":102,"y":408,"width":372,"height":11}},{"id":"0c4ae609-9cc7-4231-8b73-1e07bf535684","block_type":"box","text":"Reduced sales charges may be applicable for purchases of","page_number":136,"box":{"x":481,"y":407,"width":421,"height":12}},{"id":"e734d0f7-6fc4-456c-be97-d0df47c7f5de","block_type":"box","text":"Investor A, Investor A1 or Investor P Shares of a Fund through certain financial advisers, selected securities dealers","page_number":136,"box":{"x":70,"y":423,"width":825,"height":11}},{"id":"293f4876-221a-4766-98f7-90322b6e74c9","block_type":"box","text":"and other financial intermediaries that meet and adhere to standards established by the Manager from time to time.","page_number":136,"box":{"x":69,"y":438,"width":830,"height":11}},{"id":"0fd959cf-9e21-49e8-b932-ab685b1c676a","block_type":"box","text":"Deferred Sales Charge Alternative — Investor C Shares","page_number":136,"box":{"x":69,"y":468,"width":405,"height":11}},{"id":"59a1f0b2-9f8c-4afd-97c5-3523eed68a99","block_type":"box","text":"Investors choosing the deferred sales charge alternative should consider Investor C Shares if they are uncertain","page_number":136,"box":{"x":102,"y":491,"width":799,"height":11}},{"id":"7acbf575-ee92-4a4a-9e9e-847379efd3e1","block_type":"box","text":"as to the length of time they intend to hold their assets in a Fund. If you select Investor C Shares, you do not pay an","page_number":136,"box":{"x":69,"y":506,"width":828,"height":11}},{"id":"16774c65-46df-4b46-9cc4-5d9cc84391c1","block_type":"box","text":"initial sales charge at the time of purchase. A Fund will not accept a purchase order of $500,000 or more for","page_number":136,"box":{"x":70,"y":520,"width":778,"height":12}},{"id":"49b260fe-d47e-4991-95a1-ea892d280698","block_type":"box","text":"Investor C Shares (may be lower on funds that have set a lower breakpoint for NAV). Your financial intermediary may","page_number":136,"box":{"x":70,"y":536,"width":826,"height":11}},{"id":"1e0ba482-cdbb-4abc-91ad-0714b2936f2b","block_type":"box","text":"set a lower maximum for Investor C Shares.","page_number":136,"box":{"x":69,"y":551,"width":311,"height":9}},{"id":"02696c97-36dc-485b-ae09-428efde5f52d","block_type":"box","text":"Investor C Shares are not available in accounts opened or held directly with a Fund that do not have a financial","page_number":136,"box":{"x":102,"y":574,"width":789,"height":11}},{"id":"24ba974b-a8a0-4c43-9d6c-9050ac20a177","block_type":"box","text":"intermediary associated with the account.","page_number":136,"box":{"x":70,"y":589,"width":297,"height":11}},{"id":"c79a040b-2800-407d-b9da-9b0592f0e116","block_type":"box","text":"If you select Investor C Shares, you do not pay an initial sales charge at the time of purchase.","page_number":136,"box":{"x":102,"y":612,"width":669,"height":11}},{"id":"b3d12b75-1ef6-4cb6-9b91-893dbb48df76","block_type":"box","text":"The deferred sales charge alternatives may be particularly appealing to investors who do not qualify for the","page_number":136,"box":{"x":101,"y":634,"width":763,"height":12}},{"id":"76605ab4-0e12-48a0-8c2a-ca7d7c1c3165","block_type":"box","text":"reduction in initial sales charges. CDSC shares are subject to ongoing service fees and distribution fees; however,","page_number":136,"box":{"x":69,"y":649,"width":815,"height":12}},{"id":"45f38f7e-df5e-4d13-aa40-882ae3d74f33","block_type":"box","text":"these fees potentially may be offset to the extent any return is realized on the additional funds initially invested in","page_number":136,"box":{"x":68,"y":664,"width":813,"height":12}},{"id":"e1c90ed6-ec64-44f7-9bb0-d144177bd518","block_type":"box","text":"CDSC shares.","page_number":136,"box":{"x":69,"y":680,"width":97,"height":9}},{"id":"838d262e-e53c-4b47-8edb-be06026e7c47","block_type":"box","text":"BlackRock compensates financial advisers and other financial intermediaries for selling CDSC shares at the time","page_number":136,"box":{"x":102,"y":702,"width":804,"height":12}},{"id":"0ca22cb1-41ce-4771-9595-a97ffcac7d4a","block_type":"box","text":"of purchase from its own funds. Proceeds from the CDSC and the distribution fee are paid to the Distributor and are","page_number":136,"box":{"x":69,"y":717,"width":827,"height":11}},{"id":"607f3a7f-316a-4d0d-ae5a-74cfe9a143e8","block_type":"box","text":"used by the Distributor to defray the expenses of securities dealers or other financial intermediaries related to","page_number":136,"box":{"x":69,"y":732,"width":786,"height":12}},{"id":"8de75290-703f-4f9b-be35-371aa275fa80","block_type":"box","text":"providing distribution-related services to each Fund in connection with the sale of the CDSC shares. The combination","page_number":136,"box":{"x":70,"y":748,"width":831,"height":11}},{"id":"b8a89c26-196a-40c0-b80b-1bae7ae87beb","block_type":"box","text":"of the CDSC and the ongoing distribution fee facilitates the ability of each Fund to sell the CDSC shares without a","page_number":136,"box":{"x":69,"y":763,"width":809,"height":11}},{"id":"729cae51-451a-4d40-a864-5c03e3bc2c0f","block_type":"box","text":"sales charge being deducted at the time of purchase. See “Distribution and/or Shareholder Servicing Plans” below.","page_number":136,"box":{"x":69,"y":778,"width":824,"height":11}},{"id":"8f7cdc3b-fdcf-4f02-8ef9-2ad521cd3195","block_type":"box","text":"Imposition of the CDSC and the distribution fee on CDSC shares is limited by FINRA (as defined below) asset-based","page_number":136,"box":{"x":70,"y":793,"width":822,"height":11}},{"id":"e3186bf5-22ab-44bb-bde0-899ced2dc092","block_type":"box","text":"sales charge rule. See “Limitations on the Payment of Deferred Sales Charges” below.","page_number":136,"box":{"x":69,"y":808,"width":618,"height":11}},{"id":"b50dcf45-132d-4b0c-9e4a-6dce575ed96a","block_type":"box","text":"Dealers will generally immediately receive commissions equal to 1.00% of the Investor C Shares sold by them","page_number":136,"box":{"x":102,"y":831,"width":782,"height":11}},{"id":"5458c64e-e931-4bb1-ac94-d0e1f71dc53f","block_type":"box","text":"plus ongoing fees under the Fund’s Distribution and Service Plan. Dealers may not receive a commission in","page_number":136,"box":{"x":70,"y":846,"width":764,"height":11}},{"id":"5ebbc589-9144-479f-aa26-e9e0a3536fb2","block_type":"box","text":"connection with sales of Investor C Shares to certain employer-sponsored retirement plans sponsored by the Fund,","page_number":136,"box":{"x":69,"y":861,"width":820,"height":11}},{"id":"1a5b1a45-6240-4acb-ac53-2cb2f6224731","block_type":"box","text":"BlackRock or its affiliates, but may receive fees under the Distribution and Service Plan. These commissions and","page_number":136,"box":{"x":70,"y":876,"width":806,"height":11}},{"id":"6d635f7e-d88a-4d16-abb7-4dfbc0298f51","block_type":"box","text":"payments may be different than the reallowances, placement fees and commissions paid to dealers in connection","page_number":136,"box":{"x":70,"y":891,"width":813,"height":11}},{"id":"e4b306dd-2b7f-4875-b91d-b44eaaba0a36","block_type":"box","text":"II-105","page_number":136,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"d2a74ef2-30b5-4162-ad4c-2fdd02a39917","block_type":"box","text":"NM0926U-5977317-136/232","page_number":136,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"dce520a0-f60c-4102-86b9-b88a0a0fb396","block_type":"box","text":"with sales of Investor A, Investor A1 and Investor P Shares. These may depend upon the policies, procedures and","page_number":137,"box":{"x":68,"y":45,"width":811,"height":11}},{"id":"6c5b95d3-21b0-4791-bf1c-265454361e71","block_type":"box","text":"trading platforms of your financial intermediary; consult your financial adviser.","page_number":137,"box":{"x":68,"y":60,"width":554,"height":11}},{"id":"b4c3d40f-5f55-4758-b080-c9ab3eec706f","block_type":"box","text":"Each Fund has adopted an automatic conversion feature for Investor C Shares. Effective November 23, 2020,","page_number":137,"box":{"x":102,"y":82,"width":783,"height":11}},{"id":"8368c03c-1ce8-46c4-8b1e-3012ca21d73e","block_type":"box","text":"Investor C Shares held for approximately eight years will be converted into Investor A Shares, as set forth in each","page_number":137,"box":{"x":70,"y":98,"width":808,"height":11}},{"id":"c9272440-7a76-43a6-9be0-05003b4da66c","block_type":"box","text":"Fund’s Prospectus. In addition, accounts that do not have a financial intermediary associated with them are not","page_number":137,"box":{"x":70,"y":113,"width":797,"height":11}},{"id":"ff913130-52da-43ed-a8dc-a036cb469a7e","block_type":"box","text":"eligible to hold Investor C Shares, and any Investor C Shares held in such accounts will be automatically converted to","page_number":137,"box":{"x":69,"y":128,"width":837,"height":11}},{"id":"342b7e11-0c07-4807-8e66-b490cd199847","block_type":"box","text":"Investor A Shares.","page_number":137,"box":{"x":70,"y":143,"width":128,"height":9}},{"id":"c9017ce5-1b42-479d-883c-f3046a76261d","block_type":"box","text":"Conversion of Investor C Shares to Investor A Shares","page_number":137,"box":{"x":102,"y":166,"width":378,"height":9}},{"id":"82ffbb65-d9b5-49df-8f41-9a043bbf0a4d","block_type":"box","text":"Effective November 23, 2020 (the “Effective Date”), approximately eight years after purchase, Investor C Shares","page_number":137,"box":{"x":102,"y":188,"width":804,"height":12}},{"id":"76f98c7a-b861-4713-990b-16cd5e102f31","block_type":"box","text":"of each Fund will convert automatically into Investor A Shares of that Fund (the “Investor C 8-Year Conversion”).","page_number":137,"box":{"x":69,"y":203,"width":794,"height":12}},{"id":"28a1e403-32ce-4e34-a930-b51fcc219619","block_type":"box","text":"Certain funds (the “Predecessor Funds”) were reorganized into new Funds (the “Successor Funds”) pursuant to","page_number":137,"box":{"x":69,"y":218,"width":794,"height":12}},{"id":"ed0785e1-d217-4af3-849c-581361424dfc","block_type":"box","text":"reorganizations which occurred in September 2018. The holding period for Investor C Shares of Successor Funds","page_number":137,"box":{"x":69,"y":234,"width":806,"height":11}},{"id":"1280cc69-4d41-40cb-aaa1-da13098269f1","block_type":"box","text":"includes the period such shares were held in the respective Predecessor Fund. It is the financial intermediary’s","page_number":137,"box":{"x":70,"y":249,"width":793,"height":11}},{"id":"034f34be-fc79-4381-abf5-bbf0a07ee213","block_type":"box","text":"responsibility to ensure that the shareholder is credited with the proper holding period. As of the Effective Date,","page_number":137,"box":{"x":69,"y":264,"width":796,"height":11}},{"id":"34bba394-1826-4087-9441-e64a2b2fa5e2","block_type":"box","text":"certain financial intermediaries, including group retirement recordkeeping platforms, may not have been tracking","page_number":137,"box":{"x":69,"y":279,"width":802,"height":11}},{"id":"c0c8d906-747a-420b-8764-0595cefa6320","block_type":"box","text":"such holding periods and therefore may not be able to process such conversions. In such instances, Investor C","page_number":137,"box":{"x":69,"y":294,"width":793,"height":11}},{"id":"f44a78a3-4732-49f9-a784-cce7c780de22","block_type":"box","text":"Shares held as of the Effective Date will automatically convert to Investor A Shares approximately eight years after","page_number":137,"box":{"x":69,"y":309,"width":817,"height":11}},{"id":"72fbbcb3-8d9f-4c9d-9238-55cd405ec926","block_type":"box","text":"the Effective Date. If, as of November 23, 2028 (eight years after the Effective Date), a financial intermediary has","page_number":137,"box":{"x":68,"y":324,"width":814,"height":12}},{"id":"07303217-6f80-4ee9-af8e-fd036d7bd794","block_type":"box","text":"not implemented systems or procedures to track holding periods commencing from the Effective Date, shareholders","page_number":137,"box":{"x":69,"y":339,"width":828,"height":12}},{"id":"542217a6-2331-4480-9684-d08cabbf6187","block_type":"box","text":"holding Investor C Shares through such financial intermediary will no longer be eligible to hold Investor C Shares and","page_number":137,"box":{"x":69,"y":355,"width":832,"height":11}},{"id":"21cd80c2-2a64-40f9-8cfa-8c462a7d7510","block_type":"box","text":"any such shares will convert to Investor A Shares as soon as reasonably practicable after such date.","page_number":137,"box":{"x":69,"y":370,"width":718,"height":11}},{"id":"606c040a-71ee-4e69-a1c9-6c7ab8e1d9b4","block_type":"box","text":"In addition, accounts that do not have a financial intermediary associated with them are not eligible to hold","page_number":137,"box":{"x":102,"y":392,"width":764,"height":12}},{"id":"9aa150dc-d21b-48c9-8209-4baf546afbb4","block_type":"box","text":"Investor C Shares, and any Investor C Shares held in such accounts will be automatically converted into Investor A","page_number":137,"box":{"x":70,"y":408,"width":816,"height":11}},{"id":"5236f653-a260-4280-84a3-37fa3870b6f8","block_type":"box","text":"Shares (the “Investor C Direct Accounts Conversion” and together with the Investor C 8-Year Conversion, the","page_number":137,"box":{"x":69,"y":423,"width":772,"height":11}},{"id":"f11fdf5e-0873-44ea-b0a6-4bb2d61efed0","block_type":"box","text":"“Investor C Conversions”).","page_number":137,"box":{"x":70,"y":438,"width":186,"height":11}},{"id":"e3071ce2-8358-4801-86ac-e6e615a7bb74","block_type":"box","text":"The Investor C Conversions will occur at least once each month (on the “Investor C Conversion Date”) on the","page_number":137,"box":{"x":101,"y":460,"width":776,"height":11}},{"id":"1b9b5bab-9ec3-4c24-8e82-af7be69d44e8","block_type":"box","text":"basis of the relative NAV of the shares of the two applicable classes on the Investor C Conversion Date, without the","page_number":137,"box":{"x":69,"y":475,"width":824,"height":11}},{"id":"6cf252b1-d0d5-4784-9b83-d445ab10de87","block_type":"box","text":"imposition of any sales load, fee or other charge. The Investor C Conversions will not be deemed a purchase or sale","page_number":137,"box":{"x":70,"y":491,"width":827,"height":11}},{"id":"d7da2fd0-cdca-4b7b-90c6-872a33c68072","block_type":"box","text":"of the shares for U.S. federal income tax purposes. Shares acquired through reinvestment of dividends on Investor C","page_number":137,"box":{"x":69,"y":506,"width":833,"height":11}},{"id":"f19b70a5-0576-4405-82f1-2c494c48240c","block_type":"box","text":"Shares will also convert automatically to Investor A Shares, as set forth in each Fund’s Prospectus. The Investor C","page_number":137,"box":{"x":69,"y":521,"width":818,"height":11}},{"id":"87b8622a-0995-4406-b136-2ae7825a8d81","block_type":"box","text":"Conversion Date for dividend reinvestment shares will be calculated taking into account the length of time the shares","page_number":137,"box":{"x":69,"y":536,"width":836,"height":11}},{"id":"4a0721d7-481e-43a9-81eb-1626b1904b92","block_type":"box","text":"underlying the dividend reinvestment shares were outstanding.","page_number":137,"box":{"x":69,"y":551,"width":445,"height":11}},{"id":"4599f947-1ae4-4793-ae1d-aa0ab281b1e5","block_type":"box","text":"Contingent Deferred Sales Charge — Investor C Shares","page_number":137,"box":{"x":102,"y":574,"width":396,"height":11}},{"id":"5f0d475f-01e3-486f-9d0d-af582f3fcee8","block_type":"box","text":"Investor C Shares that are redeemed within one year of purchase may be subject to a 1.00% CDSC charged as a","page_number":137,"box":{"x":102,"y":596,"width":804,"height":12}},{"id":"dc5fbac5-eae7-48f1-8296-bd7b21d01e6c","block_type":"box","text":"percentage of the dollar amount subject thereto. In determining whether an Investor C Shares CDSC is applicable to","page_number":137,"box":{"x":70,"y":612,"width":826,"height":11}},{"id":"8859512c-e2e4-4802-88db-7c1ced178ef3","block_type":"box","text":"a redemption, the calculation will be determined in the manner that results in the lowest possible rate being charged.","page_number":137,"box":{"x":69,"y":627,"width":837,"height":11}},{"id":"d09af5d4-4e53-4405-947a-3cda6d0c3f82","block_type":"box","text":"The charge will be assessed on an amount equal to the lesser of the proceeds of redemption or the cost of the","page_number":137,"box":{"x":68,"y":642,"width":795,"height":11}},{"id":"6932d450-9e47-4ad4-a04b-133795ead705","block_type":"box","text":"shares being redeemed. Accordingly, no CDSC will be imposed on increases in NAV above the initial purchase price of","page_number":137,"box":{"x":69,"y":657,"width":840,"height":11}},{"id":"1024c0fb-6c26-4200-91a9-3ac3f5783a8d","block_type":"box","text":"Investor C Shares. In addition, no CDSC will be assessed on Investor C Shares acquired through reinvestment of","page_number":137,"box":{"x":70,"y":672,"width":804,"height":11}},{"id":"438a81fb-1ee8-4ff3-858b-c591d17d4366","block_type":"box","text":"dividends. It will be assumed that the redemption is first of shares held for over one year or shares acquired","page_number":137,"box":{"x":69,"y":687,"width":772,"height":11}},{"id":"fc234408-f175-47ee-a0d0-19875fb651a4","block_type":"box","text":"pursuant to reinvestment of dividends and then of shares held longest during the one-year period. A transfer of","page_number":137,"box":{"x":70,"y":702,"width":790,"height":12}},{"id":"d7726f3e-6c2a-49e4-b9c4-3f37d049ade5","block_type":"box","text":"shares from a shareholder’s account to another account will be assumed to be made in the same order as a","page_number":137,"box":{"x":69,"y":717,"width":776,"height":9}},{"id":"163b81c4-f081-4c1d-ad30-d7cd103f0702","block_type":"box","text":"redemption.","page_number":137,"box":{"x":69,"y":733,"width":83,"height":10}},{"id":"1014f65b-f8dc-4e3a-aa9d-2145b8fb0dee","block_type":"box","text":"See “Information on Sales Charges and Distribution Related Expenses” in Part I of each Fund’s SAI for","page_number":137,"box":{"x":102,"y":755,"width":734,"height":11}},{"id":"bf462491-ab5d-4fc2-a3f1-0d64de53ba2f","block_type":"box","text":"information about amounts paid to the Distributor in connection with CDSC shares for the periods indicated.","page_number":137,"box":{"x":70,"y":770,"width":769,"height":11}},{"id":"6c25ea2b-4e3d-41cd-9e83-181efed81fa9","block_type":"box","text":"Investor C Shares — Contingent Deferred Sales Charge Waivers and Reductions","page_number":137,"box":{"x":102,"y":793,"width":572,"height":11}},{"id":"6e81bdd8-f0ee-46c4-997c-12bcb4156568","block_type":"box","text":"The CDSC on Investor C Shares is not charged in connection with: (1) redemptions of Investor C Shares","page_number":137,"box":{"x":101,"y":816,"width":740,"height":11}},{"id":"33248678-a58d-4f1a-b2d3-44335737165f","block_type":"box","text":"purchased through certain employer-sponsored retirement plans and fee-based programs previously approved by","page_number":137,"box":{"x":70,"y":831,"width":802,"height":11}},{"id":"e294f5a6-bc7f-45dc-938b-f012a9cb7120","block_type":"box","text":"certain Funds and rollovers of current investments in the Fund through such plans; (2) exchanges described in","page_number":137,"box":{"x":69,"y":846,"width":786,"height":11}},{"id":"921e003a-ca76-4cba-8930-fb25bab322e4","block_type":"box","text":"“Exchange Privilege” below; (3) redemptions made in connection with minimum required distributions due to the","page_number":137,"box":{"x":70,"y":861,"width":797,"height":11}},{"id":"67fadea9-60f7-429d-a369-d0eb0d065f7e","block_type":"box","text":"shareholder reaching age 72 from IRA and 403(b)(7) accounts; (4) redemptions made with respect to certain","page_number":137,"box":{"x":69,"y":876,"width":776,"height":11}},{"id":"a9252270-b102-4fc7-a314-8cf4ce18d5ea","block_type":"box","text":"retirement plans sponsored by the Fund, BlackRock or its affiliates; (5) redemptions in connection with a","page_number":137,"box":{"x":69,"y":891,"width":747,"height":11}},{"id":"818a039a-cfe9-4646-852a-cd0b8e825676","block_type":"box","text":"shareholder’s death as long as the waiver request is made within one year of death or, if later, reasonably promptly","page_number":137,"box":{"x":69,"y":906,"width":822,"height":12}},{"id":"07c2b5f0-35e7-487b-975b-41131d227fe9","block_type":"box","text":"II-106","page_number":137,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"786b63bb-c3b8-4d41-9fb5-3410b62befe1","block_type":"box","text":"NM0926U-5977317-137/232","page_number":137,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"c016e8a3-2e63-439a-b0b4-e320b69fffe0","block_type":"box","text":"following completion of probate (including in connection with the distribution of account assets to a beneficiary of the","page_number":138,"box":{"x":68,"y":45,"width":836,"height":11}},{"id":"83f6097e-ec2e-4539-b038-c6b7ff1ed86e","block_type":"box","text":"decedent) or disability (as defined in the Code) subsequent to the purchase of Investor C Shares; (6) withdrawals","page_number":138,"box":{"x":69,"y":60,"width":806,"height":11}},{"id":"28270b7a-7465-4cdc-8a59-9554e241510a","block_type":"box","text":"resulting from shareholder disability (as defined in the Code) as long as the disability arose subsequent to the","page_number":138,"box":{"x":69,"y":75,"width":786,"height":11}},{"id":"edb50a52-04af-46d3-a64d-48c9b03b9908","block_type":"box","text":"purchase of the shares; (7) involuntary redemptions of Investor C Shares in accounts with low balances as described","page_number":138,"box":{"x":70,"y":90,"width":834,"height":11}},{"id":"fd981854-b5a6-4039-a627-da4e93915257","block_type":"box","text":"in “Redemption of Shares” below; (8) redemptions made pursuant to a systematic withdrawal plan, subject to the","page_number":138,"box":{"x":70,"y":105,"width":809,"height":11}},{"id":"e9f4abfc-2fba-47fa-b331-15cc185a2bc0","block_type":"box","text":"limitations set forth under “Systematic Withdrawal Plan” below; (9) redemptions related to the payment of BNY","page_number":138,"box":{"x":70,"y":120,"width":791,"height":11}},{"id":"36664cc0-58ab-4526-998b-a77fd74a2de1","block_type":"box","text":"Mellon Investment Servicing Trust Company custodial IRA fees; and (10) redemptions when a shareholder can","page_number":138,"box":{"x":70,"y":135,"width":784,"height":12}},{"id":"e1c47f94-6826-4340-a92b-a5f83c2fa9a9","block_type":"box","text":"demonstrate hardship, in the absolute discretion of the Fund. In addition, no CDSC is charged on Investor C Shares","page_number":138,"box":{"x":69,"y":150,"width":824,"height":12}},{"id":"f138965d-eae3-439d-8402-029c841d8ab5","block_type":"box","text":"acquired through the reinvestment of dividends or distributions.","page_number":138,"box":{"x":69,"y":166,"width":451,"height":11}},{"id":"61ef72ba-7ded-4b85-90d7-b580696736ae","block_type":"box","text":"Certain CDSC waivers and reductions on Investor C Shares may be available to customers of certain financial","page_number":138,"box":{"x":102,"y":188,"width":781,"height":11}},{"id":"b44c04f5-4e11-410d-8000-b525bc1dde0d","block_type":"box","text":"intermediaries, as described under “Intermediary-Defined Sales Charge Waiver Policies” in the Fund’s Prospectus.","page_number":138,"box":{"x":70,"y":203,"width":813,"height":12}},{"id":"6883c1d4-914a-480a-be73-14bd7497b1d4","block_type":"box","text":"Please speak to your financial intermediary for more information.","page_number":138,"box":{"x":69,"y":218,"width":462,"height":12}},{"id":"7179c03e-e99f-4c93-9f87-737f60727fc7","block_type":"box","text":"Class R Shares","page_number":138,"box":{"x":69,"y":249,"width":110,"height":9}},{"id":"c4c3aac0-6ac6-4f97-8423-072aeb09069c","block_type":"box","text":"Certain of the Funds offer Class R Shares as described in each such Fund’s Prospectus. Class R Shares are","page_number":138,"box":{"x":102,"y":271,"width":775,"height":11}},{"id":"f5467ae2-80a5-41fb-ba26-074beacceae2","block_type":"box","text":"available only to certain employer-sponsored retirement plans. Class R Shares are not subject to an initial sales","page_number":138,"box":{"x":69,"y":287,"width":799,"height":11}},{"id":"28d88875-ef58-4da7-929c-97aac1af136c","block_type":"box","text":"charge or a CDSC but are subject to an ongoing distribution fee of 0.25% per year and an ongoing service fee of","page_number":138,"box":{"x":69,"y":302,"width":801,"height":11}},{"id":"a90e476a-49e2-4ee1-963a-07780b98b561","block_type":"box","text":"0.25% per year. Distribution fees are used to support the Fund’s marketing and distribution efforts, such as","page_number":138,"box":{"x":69,"y":317,"width":772,"height":11}},{"id":"71ed1296-ca39-4d59-8d21-1ca5aa155168","block_type":"box","text":"compensating financial advisers and other financial intermediaries, advertising and promotion. Service fees are used","page_number":138,"box":{"x":69,"y":332,"width":836,"height":11}},{"id":"d791cf85-6d5d-4c10-9219-bdf7c7fd2492","block_type":"box","text":"to compensate securities dealers and other financial intermediaries for service activities.","page_number":138,"box":{"x":68,"y":347,"width":636,"height":11}},{"id":"f546ff66-7d2e-420d-8eac-3bb183dfcf9d","block_type":"box","text":"If Class R Shares are held over time, these fees may exceed the maximum sales charge that an investor would","page_number":138,"box":{"x":102,"y":370,"width":791,"height":11}},{"id":"97d65c8a-fb68-4c8e-9a2a-174fe0bc8dd4","block_type":"box","text":"have paid as a shareholder of one of the other share classes.","page_number":138,"box":{"x":69,"y":385,"width":440,"height":11}},{"id":"3fd1e1f7-9e78-4300-a211-083cff381896","block_type":"box","text":"Class K Shares","page_number":138,"box":{"x":69,"y":415,"width":109,"height":9}},{"id":"15fa2354-b1ab-47e3-9fdd-bcda88529165","block_type":"box","text":"Certain Funds offer Class K Shares as described in each such Fund’s Prospectus. Class K Shares are available","page_number":138,"box":{"x":102,"y":438,"width":797,"height":11}},{"id":"80428196-0c17-487c-a0e5-4c01cb05e475","block_type":"box","text":"only to (i) certain employee benefit plans, such as health savings accounts, and certain employer-sponsored","page_number":138,"box":{"x":69,"y":453,"width":772,"height":11}},{"id":"49b83a73-1c7f-4258-ae55-7c3d93207ab6","block_type":"box","text":"retirement plans (not including SEP IRAs, SIMPLE IRAs and SARSEPs) (collectively, “Employer-Sponsored Retirement","page_number":138,"box":{"x":69,"y":468,"width":827,"height":11}},{"id":"27fdd091-b6ae-4c15-ad7b-ce261492ece2","block_type":"box","text":"Plans”), (ii) collective trust funds, investment companies and other pooled investment vehicles, each of which may","page_number":138,"box":{"x":69,"y":483,"width":817,"height":11}},{"id":"fec476ee-960d-4ea9-8f66-3a0bcb92ee1e","block_type":"box","text":"purchase shares of the Fund through a financial intermediary that has entered into an agreement with the Distributor","page_number":138,"box":{"x":70,"y":498,"width":834,"height":11}},{"id":"acfa9a68-1946-49a7-9ba3-59750fbd402c","block_type":"box","text":"to purchase such shares, (iii) “Institutional Investors,” which include but are not limited to, endowments,","page_number":138,"box":{"x":68,"y":514,"width":748,"height":10}},{"id":"bc52de5f-1c48-40ba-8114-6d8180249108","block_type":"box","text":"foundations, family offices, banks and bank trusts, local, city, and state governmental institutions, corporations and","page_number":138,"box":{"x":68,"y":528,"width":828,"height":12}},{"id":"cb78d10d-0edd-48bc-80b3-80be7f40ec7f","block_type":"box","text":"insurance company separate accounts, each of which may purchase shares of the Fund through a financial","page_number":138,"box":{"x":70,"y":543,"width":760,"height":12}},{"id":"62569ac2-d2d3-4ad7-9b4a-23b9cc16167f","block_type":"box","text":"intermediary that has entered into an agreement with the Distributor to purchase such shares, (iv) clients of private","page_number":138,"box":{"x":70,"y":559,"width":823,"height":11}},{"id":"0f118975-ab23-4de0-8c75-7c8bbd14e564","block_type":"box","text":"banks that purchase shares of the Fund through a financial intermediary that has entered into an agreement with the","page_number":138,"box":{"x":69,"y":574,"width":836,"height":11}},{"id":"fd8fb2b9-a432-492b-8a7c-45b208d1a65d","block_type":"box","text":"Distributor to sell such shares; (v) fee-based advisory platforms of a financial intermediary that (a) has specifically","page_number":138,"box":{"x":70,"y":589,"width":814,"height":11}},{"id":"61006750-bc84-432e-8e9f-a58d20a5d543","block_type":"box","text":"acknowledged in a written agreement with the Distributor and/or its affiliate(s) that the financial intermediary shall","page_number":138,"box":{"x":69,"y":604,"width":817,"height":11}},{"id":"10dffd41-ffb6-4103-b789-78ec69b2c0a6","block_type":"box","text":"offer such shares to fee-based advisory clients through an omnibus account held at the Fund or (b) transacts in the","page_number":138,"box":{"x":69,"y":619,"width":823,"height":11}},{"id":"75a2c726-1166-4759-9ef1-c714498fad80","block_type":"box","text":"Fund’s shares through another intermediary that has executed such an agreement and (vi) any other investors who","page_number":138,"box":{"x":70,"y":634,"width":818,"height":12}},{"id":"04baefa6-cf85-4d14-86e3-d692f1612b5d","block_type":"box","text":"met the eligibility criteria for BlackRock Shares or Class K Shares prior to August 15, 2016 and have continually held","page_number":138,"box":{"x":69,"y":649,"width":833,"height":12}},{"id":"5284c88a-02a5-4cb3-bfe4-595fee29e2f3","block_type":"box","text":"Class K Shares of the Fund or the respective Predecessor Fund in the same account since August 15, 2016. The","page_number":138,"box":{"x":69,"y":664,"width":807,"height":12}},{"id":"c57b6cb7-f4c3-4bdb-96f2-17a79573da8d","block_type":"box","text":"agreement referenced in (iv) above shall appear in a supplemental agreement to any selling, sub-transfer agent, or","page_number":138,"box":{"x":69,"y":680,"width":817,"height":11}},{"id":"fea314fb-65e5-4b58-9b7b-ac8dc8d76db5","block_type":"box","text":"distribution and marketing agreement.","page_number":138,"box":{"x":69,"y":695,"width":270,"height":11}},{"id":"bd1af86c-371b-4bb5-a017-5f779250b9be","block_type":"box","text":"Class K Shares are also available to employees, officers and directors/trustees of BlackRock, Inc. and","page_number":138,"box":{"x":102,"y":717,"width":734,"height":12}},{"id":"dd7977ff-4197-4c8f-83f6-49e8f683e472","block_type":"box","text":"BlackRock Funds and immediate family members of such persons, if they open an account directly with BlackRock.","page_number":138,"box":{"x":70,"y":732,"width":817,"height":12}},{"id":"3ecbc31a-5271-4a20-a1f2-73b62d983372","block_type":"box","text":"Eligible individuals who would like to convert existing holdings to Class K Shares must contact BlackRock.","page_number":138,"box":{"x":70,"y":748,"width":753,"height":11}},{"id":"952ed3d9-8a19-4f07-8c19-edf07e851c8a","block_type":"box","text":"Class G Shares","page_number":138,"box":{"x":69,"y":778,"width":110,"height":9}},{"id":"f9a55190-4d56-4d5e-b31f-b3e5df9ac07b","block_type":"box","text":"Certain Funds offer Class G Shares, which are available only to investors on eligible platforms. Eligible platforms","page_number":138,"box":{"x":102,"y":801,"width":804,"height":11}},{"id":"8ac8e68f-f6c3-48e9-b040-fd85764d93a1","block_type":"box","text":"are those where clients invest in the Fund through a single omnibus account in the name of a financial intermediary","page_number":138,"box":{"x":69,"y":816,"width":826,"height":11}},{"id":"ba496921-3e23-4c9d-83b4-0200c9cadbc4","block_type":"box","text":"that meets an initial investment minimum of $2 billion. For clients investing through such eligible platforms, the Fund","page_number":138,"box":{"x":68,"y":830,"width":836,"height":12}},{"id":"ca6b0f63-c044-4ac4-a117-ba451815caf1","block_type":"box","text":"does not impose investment minimums on any individual investor. Financial intermediaries may impose separate","page_number":138,"box":{"x":69,"y":846,"width":803,"height":11}},{"id":"14e2c790-a531-436a-b4a8-68f4ea1f9ce6","block_type":"box","text":"eligibility requirements.","page_number":138,"box":{"x":69,"y":861,"width":164,"height":11}},{"id":"68a695e1-ee23-4b21-b972-d54057d1cd08","block_type":"box","text":"II-107","page_number":138,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"b706c4ac-f9b7-416e-9ec7-54bb93b0f8e2","block_type":"box","text":"NM0926U-5977317-138/232","page_number":138,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"53234702-0837-41d1-b0fa-0d37345c36e9","block_type":"box","text":"Service Shares","page_number":139,"box":{"x":68,"y":45,"width":109,"height":9}},{"id":"2e122e38-514b-40ed-9096-a75b58bacb06","block_type":"box","text":"Certain Funds offer Service Shares, which are available only to certain investors, including: (i) certain financial","page_number":139,"box":{"x":102,"y":67,"width":788,"height":12}},{"id":"1b3f9af1-ba60-479b-81af-91b9f468b6af","block_type":"box","text":"institutions, such as banks and brokerage firms, acting on behalf of their customers; (ii) certain persons who were","page_number":139,"box":{"x":70,"y":82,"width":815,"height":12}},{"id":"3a410d5b-7a51-452e-b74d-3d1c6297f9b3","block_type":"box","text":"shareholders of the Compass Capital Group of Funds at the time of its combination with The PNC","page_number":139,"box":{"x":69,"y":98,"width":693,"height":11}},{"id":"3ff8213f-d8c2-4e5c-b7b4-103b2324f1e4","block_type":"box","text":"®","page_number":139,"box":{"x":763,"y":98,"width":6,"height":4}},{"id":"09e844fc-fc93-4fd1-95a8-fdd578683bb5","block_type":"box","text":"Fund in 1996; and","page_number":139,"box":{"x":775,"y":98,"width":130,"height":10}},{"id":"ce2978fa-24be-4d95-9c8a-91875c60a363","block_type":"box","text":"(iii) participants in the Capital Directions","page_number":139,"box":{"x":69,"y":113,"width":287,"height":11}},{"id":"561379cf-757a-4667-8e98-da7054a3ead4","block_type":"box","text":"SM","page_number":139,"box":{"x":357,"y":113,"width":11,"height":5}},{"id":"937dd9d4-b181-46e3-ad0e-2df77076ab59","block_type":"box","text":"asset allocation program. Service Shares are not subject to an initial sales","page_number":139,"box":{"x":374,"y":113,"width":534,"height":11}},{"id":"de044e44-536e-437f-a522-a3ea0acc0c7f","block_type":"box","text":"charge or a CDSC but are subject to an ongoing service fee as set forth in the applicable Fund’s Prospectus.","page_number":139,"box":{"x":69,"y":128,"width":776,"height":11}},{"id":"abf643b3-a541-4bdb-ac09-b6bb512766b5","block_type":"box","text":"BlackRock Shares","page_number":139,"box":{"x":69,"y":158,"width":133,"height":9}},{"id":"179ba03c-661d-4edd-8525-63b75fa84d2a","block_type":"box","text":"Certain Funds offer BlackRock Shares, which are available only to certain investors. BlackRock Shares are","page_number":139,"box":{"x":102,"y":181,"width":760,"height":11}},{"id":"1f0a215c-107d-41d5-9c3c-5e50a5cf8c6c","block_type":"box","text":"offered without a sales charge to institutional and individual investors, registered investment advisers and certain","page_number":139,"box":{"x":69,"y":196,"width":813,"height":11}},{"id":"8b7339d0-f661-4baa-844c-76f18be20292","block_type":"box","text":"fee-based programs.","page_number":139,"box":{"x":68,"y":211,"width":145,"height":11}},{"id":"f4809203-db9a-4ecb-b991-0d5139ec42b5","block_type":"box","text":"Distribution and/or Shareholder Servicing Plans","page_number":139,"box":{"x":69,"y":241,"width":348,"height":11}},{"id":"b1772bad-c61b-44a6-bc43-2d41ebeff1f4","block_type":"box","text":"Each Fund has adopted a plan (each, a “Plan”) pursuant to Rule 12b-1 under the Investment Company Act with","page_number":139,"box":{"x":102,"y":264,"width":790,"height":11}},{"id":"d070421f-5864-43dc-9e04-9455c038e12e","block_type":"box","text":"respect to certain share classes that allows the Fund to pay distribution fees for the sale of its shares and","page_number":139,"box":{"x":69,"y":279,"width":761,"height":11}},{"id":"6e596661-1afd-4e11-a7bf-1b6186ebfa6f","block_type":"box","text":"shareholder servicing fees for certain services provided to its shareholders.","page_number":139,"box":{"x":69,"y":294,"width":541,"height":11}},{"id":"43194d18-81c6-4e8e-8745-ac72504133d8","block_type":"box","text":"Pursuant to the Plans, a Fund may pay BRIL and/or BlackRock, or any other affiliate or significant shareholder of","page_number":139,"box":{"x":102,"y":317,"width":803,"height":11}},{"id":"a86d8027-d3a7-4537-bea9-330fd0eefbf1","block_type":"box","text":"BlackRock, fees for distribution and sales support services with respect to Investor A, Investor A1, Investor C,","page_number":139,"box":{"x":70,"y":332,"width":783,"height":11}},{"id":"eacb4648-bab0-4ff7-af1b-2e72d97591bb","block_type":"box","text":"Investor P, Service and Class R Shares. Currently, as described further below, only Investor C and Class R Shares","page_number":139,"box":{"x":70,"y":347,"width":809,"height":11}},{"id":"6d6478e6-0dc7-4e5e-b01b-54df114974b1","block_type":"box","text":"bear the expense of distribution fees under a Plan.","page_number":139,"box":{"x":69,"y":362,"width":360,"height":11}},{"id":"c09e9df3-3faf-4dc5-bb87-fd057ff5e7a6","block_type":"box","text":"Each Fund has entered into a distribution agreement with BRIL under which BRIL, as agent, offers shares of","page_number":139,"box":{"x":102,"y":385,"width":770,"height":11}},{"id":"4c67b16f-042b-453d-95b6-a1bb590463a9","block_type":"box","text":"each Fund on a continuous basis. BRIL has agreed to use appropriate efforts to effect sales of the shares, but it is","page_number":139,"box":{"x":69,"y":400,"width":824,"height":11}},{"id":"3e4eeae3-d958-451e-b46c-fc46cff0b3c2","block_type":"box","text":"not obligated to sell any particular amount of shares. BRIL’s principal business address is 50 Hudson Yards, New","page_number":139,"box":{"x":69,"y":415,"width":812,"height":11}},{"id":"8c644176-48cf-4654-90ae-e66847b98545","block_type":"box","text":"York, NY 10001. BRIL is an affiliate of BlackRock.","page_number":139,"box":{"x":68,"y":430,"width":355,"height":11}},{"id":"d686b7f8-8539-4fad-a6bb-5a046ede2445","block_type":"box","text":"Pursuant to the Plans, each Fund may also pay shareholder servicing fees (also referred to as general","page_number":139,"box":{"x":102,"y":453,"width":727,"height":11}},{"id":"6525b91b-544d-426b-bacf-0106ac248a66","block_type":"box","text":"shareholder liaison services fees) to affiliated and unaffiliated brokers, dealers, financial institutions, insurance","page_number":139,"box":{"x":69,"y":468,"width":799,"height":11}},{"id":"894fd061-1428-47a6-9079-d2039b795839","block_type":"box","text":"companies, retirement plan record-keepers and other financial intermediaries (including BlackRock, BRIL and their","page_number":139,"box":{"x":69,"y":483,"width":813,"height":11}},{"id":"f45c61bf-581e-4665-8884-dc64f5fbddae","block_type":"box","text":"affiliates) (collectively, “Service Organizations”) for certain support services rendered by Service Organizations to","page_number":139,"box":{"x":69,"y":498,"width":809,"height":11}},{"id":"5f6fb001-44c9-45b3-a618-e8edc5130fcb","block_type":"box","text":"their customers (“Customers”) who are the beneficial owners of Investor A, Investor A1, Investor C, Investor P,","page_number":139,"box":{"x":68,"y":513,"width":786,"height":11}},{"id":"37d15b03-9cb3-4a9f-84a8-08553b1fa941","block_type":"box","text":"Service and Class R Shares of a Fund. Such services are intended to supplement the services provided by the","page_number":139,"box":{"x":69,"y":528,"width":789,"height":12}},{"id":"4d934c53-b5bd-493d-a831-2a944fc16ba8","block_type":"box","text":"Fund’s Administrators and Transfer Agent to the Fund’s shareholders of record.","page_number":139,"box":{"x":70,"y":543,"width":562,"height":12}},{"id":"57b17e6a-e447-49d9-b287-ec33e86d8a73","block_type":"box","text":"The support services provided by Service Organizations are general shareholder liaison services, which include,","page_number":139,"box":{"x":101,"y":566,"width":798,"height":11}},{"id":"b1a400f1-8286-4b7f-8ec2-5315d81d9352","block_type":"box","text":"but are not limited to: (i) answering Customer inquiries regarding account status and history, the manner in which","page_number":139,"box":{"x":69,"y":581,"width":808,"height":12}},{"id":"1aec47a3-d6e5-4f67-95f1-9b5b142cd20c","block_type":"box","text":"purchases, exchanges and redemptions or repurchases of shares may be effected and certain other matters","page_number":139,"box":{"x":70,"y":596,"width":776,"height":12}},{"id":"3f26846b-7017-4dcc-995c-26f16741304f","block_type":"box","text":"pertaining to the Customers’ investments; and (ii) assisting Customers in designating and changing dividend options,","page_number":139,"box":{"x":70,"y":612,"width":835,"height":11}},{"id":"5923bf23-060a-4859-a07d-7f9585b86059","block_type":"box","text":"account designations and addresses. The shareholder servicing fees payable pursuant to the Plans are paid to","page_number":139,"box":{"x":69,"y":627,"width":791,"height":11}},{"id":"a9af53f8-77e9-45ec-8c23-a3ddcf913da7","block_type":"box","text":"compensate Service Organizations for the administration and servicing of shareholder accounts and are not costs","page_number":139,"box":{"x":69,"y":642,"width":813,"height":11}},{"id":"a1e1c860-26b6-4fe4-9429-f3f451053e8b","block_type":"box","text":"which are primarily intended to result in the sale of the Fund’s shares.","page_number":139,"box":{"x":68,"y":657,"width":501,"height":11}},{"id":"72d31ebd-63c8-4a56-8287-aa9a0409213a","block_type":"box","text":"Payments under the Plans are based on a percentage of average daily net assets attributable to the shares in","page_number":139,"box":{"x":102,"y":680,"width":783,"height":11}},{"id":"ba4c21a2-0d1b-47c7-9cc2-139204ab1f79","block_type":"box","text":"the applicable share class regardless of the amount of expenses incurred. As a result, payments under the Plans","page_number":139,"box":{"x":68,"y":695,"width":810,"height":11}},{"id":"6b7eca20-7aa0-4981-85f4-6e059aa392d4","block_type":"box","text":"may be more or less than expenses incurred in connection with providing distribution and/or shareholder services","page_number":139,"box":{"x":69,"y":710,"width":813,"height":11}},{"id":"b981ff23-cbd8-4409-8ce8-2da3ada81ab2","block_type":"box","text":"with respect to the related class. Information with respect to the payments under the Plans and expenses incurred in","page_number":139,"box":{"x":68,"y":725,"width":836,"height":11}},{"id":"30ea8ceb-d974-48cc-b3a3-e8b3b0a200da","block_type":"box","text":"providing services with respect to the related class is presented to the Directors for their consideration quarterly.","page_number":139,"box":{"x":70,"y":740,"width":805,"height":11}},{"id":"cc4394e6-f8a0-4e09-a2fa-a5f27df9f29d","block_type":"box","text":"Payments under the Plans consist of the shareholder servicing fees and the distribution fees. Expenses with respect","page_number":139,"box":{"x":69,"y":755,"width":832,"height":11}},{"id":"031a38cc-ebaf-4b61-b849-2a81f5bf469b","block_type":"box","text":"to providing distribution and/or shareholder services with respect to a class may consist of Service Organization","page_number":139,"box":{"x":68,"y":770,"width":803,"height":12}},{"id":"b4cf4e23-acfe-4759-9701-9b1ff7d3eb97","block_type":"box","text":"financial adviser compensation, branch office and regional operation center selling and transaction processing","page_number":139,"box":{"x":68,"y":785,"width":788,"height":12}},{"id":"62b79607-588a-43a5-bb62-f3315b10ab5e","block_type":"box","text":"expenses, advertising, sales promotion and marketing expenses. Payments under the Plans with respect to one","page_number":139,"box":{"x":69,"y":801,"width":798,"height":11}},{"id":"f4aa198a-615c-4a2e-acc3-0a58afbac7dc","block_type":"box","text":"class will not be used to finance the expenditures of another class. Sales personnel may receive different","page_number":139,"box":{"x":69,"y":816,"width":755,"height":11}},{"id":"9481baae-c445-40fb-b230-372df56b2b59","block_type":"box","text":"compensation for selling different classes of shares.","page_number":139,"box":{"x":69,"y":831,"width":375,"height":11}},{"id":"0ca4c45b-664f-4f17-a704-eee7885da479","block_type":"box","text":"Each Plan is subject to the provisions of Rule 12b-1 under the Investment Company Act. In their consideration of","page_number":139,"box":{"x":102,"y":853,"width":803,"height":12}},{"id":"2171fcb5-6450-4021-9148-72e198222f44","block_type":"box","text":"a Plan, the Directors must consider all factors they deem relevant, including information as to the benefits of the Plan","page_number":139,"box":{"x":69,"y":869,"width":839,"height":11}},{"id":"10d2c405-efe2-4afe-a952-014e33bb31d4","block_type":"box","text":"to the Fund and the related class of shareholders. In approving a Plan in accordance with Rule 12b-1, the non","page_number":139,"box":{"x":68,"y":884,"width":788,"height":11}},{"id":"582f5f84-4656-48bd-ad7d-ca44281de82d","block_type":"box","text":"interested Directors concluded that there is reasonable likelihood that the Plan will benefit the Fund and its related","page_number":139,"box":{"x":70,"y":899,"width":818,"height":9}},{"id":"1a94292b-d65a-4c58-8c6f-35945b61b041","block_type":"box","text":"II-108","page_number":139,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"4d8bd603-a3f1-472d-bf17-21b87a8328c3","block_type":"box","text":"NM0926U-5977317-139/232","page_number":139,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"7d8f4beb-5127-45d0-abd0-8e6a03f251bc","block_type":"box","text":"class of shareholders. The Plan provides, among other things, that: (i) the Board of Directors shall receive quarterly","page_number":140,"box":{"x":69,"y":45,"width":824,"height":11}},{"id":"221a4130-a020-4af9-8f25-91abb40f8f4b","block_type":"box","text":"reports regarding the amounts expended under the Plan and the purposes for which such expenditures were made;","page_number":140,"box":{"x":69,"y":60,"width":821,"height":11}},{"id":"488c2422-ecbe-4701-8203-e08c8f8eca91","block_type":"box","text":"(ii) the Plan will continue in effect for so long as its continuance is approved at least annually by the Board of","page_number":140,"box":{"x":69,"y":75,"width":778,"height":11}},{"id":"591d0772-667a-4b1a-89fd-7feeaa19cf29","block_type":"box","text":"Directors, including the directors who are not “interested persons” of the Fund (as defined in the Investment","page_number":140,"box":{"x":70,"y":90,"width":773,"height":11}},{"id":"e8048430-6a56-4f89-b9ed-77e9191f73c5","block_type":"box","text":"Company Act) and who have no direct or indirect financial interest in the operation of the Plan or any agreement","page_number":140,"box":{"x":69,"y":105,"width":796,"height":11}},{"id":"6462b057-4522-4e5e-b3f9-55d5368096aa","block_type":"box","text":"entered into in connection with the Plan (the “12b-1 Directors”), acting in person at a meeting called for said purpose","page_number":140,"box":{"x":69,"y":120,"width":837,"height":12}},{"id":"c1e57925-7da8-4709-8752-54f996742393","block_type":"box","text":"in accordance with Rule 12b-1 under the Investment Company Act; (iii) any material amendment thereto must be","page_number":140,"box":{"x":70,"y":135,"width":801,"height":11}},{"id":"c3ca4728-29a8-4341-94f9-301333c6eb6b","block_type":"box","text":"approved by the Board of Directors, including the 12b-1 Directors, acting in person at a meeting called for said","page_number":140,"box":{"x":69,"y":150,"width":787,"height":12}},{"id":"e231df8f-7906-42be-bf38-3af89cd1e0d5","block_type":"box","text":"purpose; (iv) any amendment to increase materially the costs which any class of shares may bear for distribution","page_number":140,"box":{"x":70,"y":166,"width":802,"height":11}},{"id":"97b1d288-30e3-47e9-91df-2c64b1e277d5","block_type":"box","text":"services pursuant to the Plan shall be effective only upon approval by a vote of a majority of the outstanding shares","page_number":140,"box":{"x":69,"y":181,"width":826,"height":11}},{"id":"8f1deddd-d68d-4577-83d3-a1ba1e81e1a8","block_type":"box","text":"of such class and by a majority of the Board of Directors, including the 12b-1 Directors, acting in person at a meeting","page_number":140,"box":{"x":69,"y":196,"width":836,"height":11}},{"id":"7d181e2c-df6e-42b3-8429-070ca36f1b74","block_type":"box","text":"called for said purpose; and (v) while the Plan remains in effect, the selection and nomination of the Fund’s Directors","page_number":140,"box":{"x":69,"y":211,"width":836,"height":11}},{"id":"9bfa433b-c86c-4c82-bf7d-62bbb5c228f1","block_type":"box","text":"who are not “interested persons” of the Fund shall be committed to the discretion of the Fund’s non-interested","page_number":140,"box":{"x":68,"y":226,"width":792,"height":11}},{"id":"23bb022f-aee2-43a2-8ede-265e1ae4d910","block_type":"box","text":"Directors. Rule 12b-1 further requires that each Fund preserve copies of each Plan and any report made pursuant to","page_number":140,"box":{"x":70,"y":241,"width":831,"height":11}},{"id":"33769bfa-630d-452f-be79-a309077f25ef","block_type":"box","text":"such Plan for a period of not less than six years from the date of the Plan or such report, the first two years in an","page_number":140,"box":{"x":69,"y":256,"width":807,"height":11}},{"id":"04dde78b-55d6-473a-a598-91861e6c70b2","block_type":"box","text":"easily accessible place.","page_number":140,"box":{"x":69,"y":272,"width":167,"height":11}},{"id":"677729d4-289d-4392-95f0-16236e23b7b3","block_type":"box","text":"Each Plan is terminable as to any class of shares without penalty at any time by a vote of a majority of the 12b-1","page_number":140,"box":{"x":102,"y":294,"width":804,"height":11}},{"id":"7209335f-a4e3-44c3-af68-300cdae0482d","block_type":"box","text":"Directors, or by vote of the holders of a majority of the shares of such class.","page_number":140,"box":{"x":70,"y":309,"width":542,"height":11}},{"id":"ae3b7406-2779-4918-b346-b0e5d2bbfcfe","block_type":"box","text":"See “Information on Sales Charges and Distribution Related Expenses” in Part I of each Fund’s SAI for","page_number":140,"box":{"x":102,"y":332,"width":734,"height":11}},{"id":"511f0dab-f668-4572-b637-f71868ee7ac0","block_type":"box","text":"information relating to the fees paid by your Fund to the Distributor under each Plan during the Fund’s most recent","page_number":140,"box":{"x":70,"y":347,"width":814,"height":11}},{"id":"6678451d-fd41-4ea7-bbc9-85e7eebf896f","block_type":"box","text":"fiscal year.","page_number":140,"box":{"x":68,"y":362,"width":75,"height":11}},{"id":"056cdceb-6483-4b30-bc46-76391a67aa48","block_type":"box","text":"Limitations on the Payment of Deferred Sales Charges","page_number":140,"box":{"x":69,"y":392,"width":396,"height":11}},{"id":"7f94abe4-bdc3-4f6a-8350-9c311aadc7ae","block_type":"box","text":"The maximum sales charge rule in the Conduct Rules of the Financial Industry Regulatory Authority (“FINRA”)","page_number":140,"box":{"x":101,"y":415,"width":777,"height":11}},{"id":"2f61a164-de57-41bb-b617-52c8c4c1d5e8","block_type":"box","text":"imposes a limitation on certain asset-based sales charges such as the distribution fee borne by Class R Shares, and","page_number":140,"box":{"x":70,"y":430,"width":835,"height":11}},{"id":"a49df1c4-b17b-4b14-a684-1a5ac55e5147","block_type":"box","text":"the distribution fee and the CDSC borne by the Investor C Shares. This limitation does not apply to the shareholder","page_number":140,"box":{"x":68,"y":445,"width":822,"height":11}},{"id":"fd33ec6c-a7e2-41ae-838b-3b1ad64ca7b8","block_type":"box","text":"servicing fee. The maximum sales charge rule is applied separately to each class and limits the aggregate of","page_number":140,"box":{"x":69,"y":460,"width":778,"height":12}},{"id":"a5d5bf8f-5cff-4e24-97e4-e87902f3ffc7","block_type":"box","text":"distribution fee payments and CDSCs payable by a Fund to (1) 6.25% of eligible gross sales of Investor C and Class R","page_number":140,"box":{"x":69,"y":475,"width":840,"height":12}},{"id":"05c7ddb5-0c6e-4350-a7fd-de3458202d7e","block_type":"box","text":"Shares, computed separately (excluding shares issued pursuant to dividend reinvestments and exchanges), plus","page_number":140,"box":{"x":69,"y":491,"width":803,"height":11}},{"id":"1d923955-f626-4c1d-ac08-d5b545c25677","block_type":"box","text":"(2) interest on the unpaid balance for the respective class, computed separately, at the prime rate plus 1% (the","page_number":140,"box":{"x":69,"y":506,"width":794,"height":11}},{"id":"4706af99-c3a8-4a1e-b2d3-c470dc3e0b9e","block_type":"box","text":"unpaid balance being the maximum amount payable minus amounts received from the payment of the distribution fee","page_number":140,"box":{"x":69,"y":521,"width":839,"height":11}},{"id":"ba443073-1396-45b3-9382-f4642f225cf8","block_type":"box","text":"and the CDSC). See “Information on Sales Charges and Distribution Related Expenses” in Part I of each Fund’s SAI","page_number":140,"box":{"x":69,"y":536,"width":824,"height":11}},{"id":"1d003bb6-aadc-4920-a3f1-642de58dfbd8","block_type":"box","text":"for comparative information as of your Fund’s most recent fiscal year end with respect to, if applicable, the Investor C","page_number":140,"box":{"x":68,"y":551,"width":839,"height":11}},{"id":"afdab991-fabb-4049-9c91-bad0b43f3b93","block_type":"box","text":"and Class R Shares of your Fund.","page_number":140,"box":{"x":69,"y":566,"width":236,"height":11}},{"id":"75261dd6-f156-4d19-b8d6-0e490bf51a8b","block_type":"box","text":"Other Payments by the Fund","page_number":140,"box":{"x":69,"y":597,"width":206,"height":11}},{"id":"43e56c53-127a-4ee6-80c6-eabb1a0a2006","block_type":"box","text":"In addition to shareholder servicing fees that a Fund may pay to a Service Organization pursuant to the Plan and","page_number":140,"box":{"x":102,"y":619,"width":800,"height":11}},{"id":"30d0897d-e802-4c13-af5d-eeb32730c24e","block_type":"box","text":"fees the Fund pays to its Transfer Agent, BlackRock, on behalf of a Fund, may enter into non-Plan agreements with","page_number":140,"box":{"x":68,"y":634,"width":816,"height":12}},{"id":"83c7663b-bbcc-40bb-aa57-8f35b0202215","block_type":"box","text":"Service Organizations pursuant to which the Fund will pay a Service Organization for administrative, networking,","page_number":140,"box":{"x":69,"y":649,"width":794,"height":12}},{"id":"3b74c9ac-24f4-4970-8f30-42c97f653257","block_type":"box","text":"recordkeeping, sub-transfer agency, sub-accounting and/or shareholder services. These non-Plan payments are","page_number":140,"box":{"x":69,"y":664,"width":792,"height":12}},{"id":"cb4b09cb-285a-4300-b1b0-72d4635cf125","block_type":"box","text":"generally based on either (1) a percentage of the average daily net assets of Fund shareholders serviced by a Service","page_number":140,"box":{"x":68,"y":680,"width":841,"height":11}},{"id":"2c4648af-1560-4663-bbc0-63c23405d139","block_type":"box","text":"Organization or (2) a fixed dollar amount for each account serviced by a Service Organization. The aggregate amount","page_number":140,"box":{"x":69,"y":695,"width":831,"height":11}},{"id":"5f82876a-c21c-4b8e-8028-225a70264544","block_type":"box","text":"of these payments may be substantial.","page_number":140,"box":{"x":69,"y":710,"width":276,"height":11}},{"id":"87f847f6-301a-4dfc-aeab-fa246de8244f","block_type":"box","text":"Additional Payments by BlackRock","page_number":140,"box":{"x":68,"y":740,"width":256,"height":11}},{"id":"d88eec97-90e8-4358-b4db-a12dba4d2b19","block_type":"box","text":"From time to time, BlackRock, BRIL and/or their affiliates (referred to in this section collectively as “BlackRock”)","page_number":140,"box":{"x":102,"y":763,"width":803,"height":11}},{"id":"6415e76b-daf9-4f71-adfa-31537e330322","block_type":"box","text":"may compensate Service Organizations for the sale and distribution of shares of a Fund, for services to a Fund and","page_number":140,"box":{"x":69,"y":778,"width":823,"height":11}},{"id":"5abbc157-2853-4b75-aca0-7e3bfed350ff","block_type":"box","text":"its shareholders and/or for data provision or technology support. A Service Organization may perform these","page_number":140,"box":{"x":70,"y":793,"width":768,"height":11}},{"id":"87c936c2-42e5-4165-a5a2-35510878a648","block_type":"box","text":"obligations itself or may arrange for a third party to perform them. These payments, which are not made pursuant to","page_number":140,"box":{"x":69,"y":808,"width":830,"height":11}},{"id":"161ae163-7bb1-4dc6-8b35-f3c43121194f","block_type":"box","text":"a Plan or otherwise paid by a Fund, are referred to as “Additional Payments” herein.","page_number":140,"box":{"x":69,"y":823,"width":599,"height":11}},{"id":"41ba9960-d07a-46e3-82f2-8231c9833b7a","block_type":"box","text":"Additional Payments are made from BlackRock’s own assets (which may come directly or indirectly from fees","page_number":140,"box":{"x":101,"y":846,"width":776,"height":11}},{"id":"8e7977b4-a237-40c1-84de-4562e23915b7","block_type":"box","text":"paid by a Fund to BlackRock for various services, such as investment advisory services). These payments are not an","page_number":140,"box":{"x":70,"y":861,"width":832,"height":11}},{"id":"1f44e5ef-34f8-41a8-b221-ca50cbf9d1fe","block_type":"box","text":"additional charge to a Fund or its shareholders and do not change the price paid by shareholders for the purchase of","page_number":140,"box":{"x":69,"y":876,"width":833,"height":11}},{"id":"1f056285-b387-431b-9d52-8a6738a335cf","block_type":"box","text":"a Fund’s shares or the amount a Fund receives as proceeds from such purchases. Additional Payments made to","page_number":140,"box":{"x":69,"y":891,"width":802,"height":11}},{"id":"a96bad6c-82dd-418e-919c-01e1ad34ea8a","block_type":"box","text":"Service Organizations are in addition to any distribution or shareholder servicing fees paid under any Plan of any","page_number":140,"box":{"x":69,"y":906,"width":802,"height":12}},{"id":"b1cf422e-3925-403d-8126-9b405a644f8a","block_type":"box","text":"II-109","page_number":140,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"3d025007-e53b-4305-83d5-0ac1a0206c4b","block_type":"box","text":"NM0926U-5977317-140/232","page_number":140,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"713cc360-a889-415c-9600-fe41ab7f901a","block_type":"box","text":"Fund, any sales charges, commissions or other concessions described in the Prospectuses or this SAI, and any","page_number":141,"box":{"x":70,"y":45,"width":796,"height":11}},{"id":"1e2a41ee-6be7-4320-bff4-e6df4c40589b","block_type":"box","text":"administrative, networking, recordkeeping, sub-transfer agency or sub-accounting fees payable by a Fund. Pursuant to","page_number":141,"box":{"x":69,"y":60,"width":836,"height":11}},{"id":"9a369972-33e6-4cbc-8456-2f545869f9fd","block_type":"box","text":"applicable FINRA regulations, the details of certain of these payments, including the Service Organizations receiving","page_number":141,"box":{"x":69,"y":75,"width":828,"height":11}},{"id":"dc77b2d1-2fbb-4d98-b808-5aa6354d0b5f","block_type":"box","text":"such payments in connection with the sale and distribution of Fund shares, are required to be disclosed. While FINRA","page_number":141,"box":{"x":69,"y":90,"width":837,"height":11}},{"id":"c646e6bf-61f0-440a-be6c-fa09b5324958","block_type":"box","text":"regulations limit the sales charges that shareholders may bear, there are no limits with regard to the amounts that","page_number":141,"box":{"x":69,"y":105,"width":818,"height":11}},{"id":"c2ded772-bc04-4b19-99f5-c622c7eeb751","block_type":"box","text":"BlackRock may pay out of its own assets.","page_number":141,"box":{"x":70,"y":120,"width":294,"height":11}},{"id":"4cdcdd79-a0da-45f8-ad8b-7f0a289c4dd5","block_type":"box","text":"Additional Payments may be made as a fixed dollar amount, may be based on the number of Customer accounts","page_number":141,"box":{"x":101,"y":143,"width":803,"height":11}},{"id":"6fe9b018-827f-4c40-a580-4c976cfd2ca6","block_type":"box","text":"maintained by a Service Organization, may be based on a percentage of the value of shares sold to, or held by,","page_number":141,"box":{"x":69,"y":158,"width":792,"height":11}},{"id":"c7925a11-6faf-4a34-9b65-792c34321f82","block_type":"box","text":"Customers of the Service Organization involved, or may be calculated on another basis.","page_number":141,"box":{"x":69,"y":173,"width":623,"height":11}},{"id":"8f6db5a3-a016-438f-bf40-d216c16f8d9f","block_type":"box","text":"BlackRock negotiates Additional Payments with each Service Organization on an individual basis. Additional","page_number":141,"box":{"x":102,"y":196,"width":765,"height":11}},{"id":"4a044875-6bc0-426b-af09-809e4793254d","block_type":"box","text":"Payments may be different for different Service Organizations, and some Service Organizations may be paid pursuant","page_number":141,"box":{"x":69,"y":211,"width":841,"height":11}},{"id":"81351ea3-57c1-46ac-b4bc-ebe315402412","block_type":"box","text":"to more than one of the calculations described above. Not all Service Organizations receive Additional Payments.","page_number":141,"box":{"x":68,"y":226,"width":806,"height":11}},{"id":"8dba8952-6267-494a-8186-5dc17e88cb22","block_type":"box","text":"Sales-based payments primarily create incentives to make new sales of shares of the Fund, and asset-based","page_number":141,"box":{"x":69,"y":241,"width":776,"height":11}},{"id":"f5b3046b-2285-4148-a89b-1070c51f3847","block_type":"box","text":"payments primarily create incentives to retain previously sold shares of the Fund. The level of payments made to","page_number":141,"box":{"x":70,"y":256,"width":802,"height":11}},{"id":"be9b1194-4bdd-445a-aa99-22fea0cb9191","block_type":"box","text":"these Service Organizations in any year will vary and may be limited to specific Funds or share classes. In certain","page_number":141,"box":{"x":68,"y":271,"width":811,"height":12}},{"id":"ac29cf90-97d2-4aa3-8d5d-ae059e8bd54f","block_type":"box","text":"cases, these payments may be subject to certain minimum payment levels.","page_number":141,"box":{"x":69,"y":287,"width":538,"height":11}},{"id":"98bc2b3d-33da-4504-8391-00fe4639953b","block_type":"box","text":"The aggregate amount of Additional Payments made by BlackRock may be substantial and may be significant to","page_number":141,"box":{"x":101,"y":309,"width":795,"height":11}},{"id":"e849d5bd-8c04-4549-91b4-7828291a9e1b","block_type":"box","text":"certain Service Organizations. The categories of Additional Payments listed below are not mutually exclusive. The","page_number":141,"box":{"x":69,"y":324,"width":807,"height":12}},{"id":"5e38ad2f-7785-4806-b7bc-a0123c365230","block_type":"box","text":"same Service Organization, or one or more of its affiliates, may receive payments under more than one category of","page_number":141,"box":{"x":69,"y":339,"width":823,"height":12}},{"id":"0c3aa615-a1f6-496e-ab04-800408c16db8","block_type":"box","text":"Additional Payments. Such payments may be different for different Service Organizations and for different types of","page_number":141,"box":{"x":68,"y":355,"width":819,"height":11}},{"id":"f7a00f86-e4dd-47ca-90a3-94d9b102cb3d","block_type":"box","text":"Funds.","page_number":141,"box":{"x":70,"y":370,"width":44,"height":9}},{"id":"e6f85726-7c3b-4959-a71b-244fcd8f6bd4","block_type":"box","text":"A. Distribution and Marketing Suppor t","page_number":141,"box":{"x":101,"y":392,"width":270,"height":12}},{"id":"840fc0ab-3fbd-4719-ba1f-8a78c9226397","block_type":"box","text":"Additional Payments may be made by BlackRock for distribution and marketing support activities. 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These payments","page_number":141,"box":{"x":68,"y":566,"width":805,"height":11}},{"id":"abfc42af-3984-40c7-a7d1-3b4965c35c9e","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":141,"box":{"x":69,"y":581,"width":828,"height":12}},{"id":"b82f9c0f-73d6-4955-8bd9-d3a8553058c9","block_type":"box","text":"of the assets attributable to that Service Organization invested in a Fund.","page_number":141,"box":{"x":69,"y":596,"width":523,"height":12}},{"id":"fe14090b-7443-47fb-8c06-a4006dc544f9","block_type":"box","text":"B. Shareholder Services","page_number":141,"box":{"x":102,"y":619,"width":172,"height":9}},{"id":"986a64bc-0d5c-4b45-a047-b7042a116a05","block_type":"box","text":"Many Fund shares are owned or held by Service Organizations for the benefit of their Customers. 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Service Organizations Receiving Additional Payments","page_number":141,"box":{"x":102,"y":861,"width":397,"height":11}},{"id":"80984ee2-2923-4060-bf14-913f7e897e2f","block_type":"box","text":"As of the date of this SAI, the Service Organizations listed below, and, in some cases, certain of the Service","page_number":141,"box":{"x":101,"y":884,"width":774,"height":11}},{"id":"286090e3-1b39-4b94-9f26-ea4eabeb3dd0","block_type":"box","text":"Organization’s affiliates, may be receiving one or more types of Additional Payments. 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BlackRock","page_number":145,"box":{"x":70,"y":361,"width":833,"height":11}},{"id":"4c2b32c7-b65e-40bd-baba-63f729941350","block_type":"box","text":"configures these tools and calculators and localizes the content for Service Organizations as part of its customary","page_number":145,"box":{"x":69,"y":376,"width":817,"height":11}},{"id":"066cb17a-03f5-48ff-8e90-63b3063a94fe","block_type":"box","text":"digital marketing support and promotion of the Funds or other BlackRock funds, iShares ETFs and other exchange","page_number":145,"box":{"x":69,"y":391,"width":815,"height":11}},{"id":"fcac517e-a77a-4298-bcaa-628a5055466c","block_type":"box","text":"traded products.","page_number":145,"box":{"x":68,"y":406,"width":116,"height":11}},{"id":"03f7b7b0-97b9-4a7c-afe6-3d74cae079ac","block_type":"box","text":"F. Conflicts","page_number":145,"box":{"x":102,"y":429,"width":78,"height":9}},{"id":"1e20b512-20fb-4c05-81b7-25aaf91aab36","block_type":"box","text":"Additional Payments made by BlackRock to a Service Organization or its affiliates or other incentive","page_number":145,"box":{"x":101,"y":452,"width":710,"height":11}},{"id":"1b2978ea-fe99-473e-9d0f-ddbd5f2e15a5","block_type":"box","text":"arrangements may be an important factor in the Service Organization’s willingness to support the sale of a Fund","page_number":145,"box":{"x":69,"y":467,"width":803,"height":11}},{"id":"677e0343-abb7-4d8b-a109-732e8d67f04c","block_type":"box","text":"and/or particular share class through its distribution system or to perform services with respect to such Fund.","page_number":145,"box":{"x":69,"y":482,"width":788,"height":11}},{"id":"edf99fc2-9671-48b0-9bac-dd04ad3daaae","block_type":"box","text":"Additional Payments and other incentive arrangements may also be important factors in the Service Organization’s","page_number":145,"box":{"x":68,"y":497,"width":819,"height":11}},{"id":"c6f4623d-995f-40d1-bb81-7c192b75aac6","block_type":"box","text":"willingness to recommend the BlackRock Fund complex in general.","page_number":145,"box":{"x":68,"y":512,"width":473,"height":11}},{"id":"1206e40e-9d53-4627-9334-dcbfbc09f6bf","block_type":"box","text":"BlackRock may be motivated to pay Additional Payments and other incentive compensation to promote the sale","page_number":145,"box":{"x":102,"y":535,"width":793,"height":11}},{"id":"59c01573-0c8b-4c3b-a7f3-3a2cd3ee6a4d","block_type":"box","text":"of Fund shares to Customers of Service Organizations and the retention of those investments by such Customers. To","page_number":145,"box":{"x":69,"y":550,"width":835,"height":11}},{"id":"3a31379e-b20e-4d6f-8bee-f8a025735540","block_type":"box","text":"the extent Service Organizations sell more shares of a Fund or retain shares of a Fund in their Customers’ accounts,","page_number":145,"box":{"x":68,"y":565,"width":833,"height":11}},{"id":"5e7afa27-f62c-43fc-b600-8dd5d7dbeb3c","block_type":"box","text":"BlackRock benefits from the incremental management and other fees paid by the Fund with respect to those assets.","page_number":145,"box":{"x":70,"y":580,"width":830,"height":11}},{"id":"ef5e687e-ae7b-47af-9985-a314fed71d76","block_type":"box","text":"Service Organizations may have financial incentives for recommending a particular Fund, share class or fund","page_number":145,"box":{"x":102,"y":603,"width":774,"height":11}},{"id":"509c03ee-acd0-42c1-9c19-0da109f1f7e7","block_type":"box","text":"complex over another. Service Organizations may charge their Customers additional fees in connection with the","page_number":145,"box":{"x":69,"y":618,"width":794,"height":11}},{"id":"bcdb10f4-d5b8-47ca-965f-fdd469b17905","block_type":"box","text":"purchase or redemption of Fund shares or for account-related services which are in addition to the sales and other","page_number":145,"box":{"x":70,"y":633,"width":818,"height":11}},{"id":"da421bed-1ef3-4b5d-883f-e3315b8ae0f4","block_type":"box","text":"charges described in the Fund’s Prospectus and this SAI. Such charges may vary among Service Organizations but in","page_number":145,"box":{"x":69,"y":648,"width":836,"height":11}},{"id":"57e63ad6-28ec-4185-a03e-ba811c760336","block_type":"box","text":"all cases will be retained by the Service Organization and will not be remitted to a Fund or BlackRock.","page_number":145,"box":{"x":69,"y":663,"width":723,"height":12}},{"id":"c09f34a4-e892-4943-81cd-ea3189f08746","block_type":"box","text":"Shareholders should consider whether such incentives exist when evaluating any recommendations from a","page_number":145,"box":{"x":102,"y":686,"width":759,"height":11}},{"id":"455cf529-effc-44b1-8aa7-c2becc90ee1e","block_type":"box","text":"Service Organization to purchase or sell shares of a Fund and when considering which share class is most","page_number":145,"box":{"x":69,"y":701,"width":760,"height":11}},{"id":"f2ce7ee1-0183-4326-95ba-e37729488a2b","block_type":"box","text":"appropriate.","page_number":145,"box":{"x":69,"y":716,"width":84,"height":11}},{"id":"c8351cce-7b87-45bc-9801-9822ac548608","block_type":"box","text":"You should consult with your Service Organization, and review carefully any disclosure by the Service","page_number":145,"box":{"x":160,"y":716,"width":738,"height":11}},{"id":"6358ec72-de6c-42a1-bc91-efd82b1eadc5","block_type":"box","text":"Organization, as to compensation received by it or its affiliates and for more information about the payments","page_number":145,"box":{"x":69,"y":731,"width":795,"height":11}},{"id":"341f3d14-eb23-4c5b-9ab1-8ba4215ea8dc","block_type":"box","text":"described above.","page_number":145,"box":{"x":69,"y":746,"width":122,"height":9}},{"id":"e3fc7836-e5dc-4137-85bf-08da537cda32","block_type":"box","text":"REDEMPTION OF SHARES","page_number":145,"box":{"x":385,"y":776,"width":208,"height":10}},{"id":"8c1b3c88-a6b8-4d64-86cf-98e2ea0bccd2","block_type":"box","text":"Shares normally will be redeemed for cash upon receipt of a request in proper form, although each Fund retains","page_number":145,"box":{"x":102,"y":799,"width":798,"height":11}},{"id":"8717632a-652a-4e6d-9c36-af1890f05c1f","block_type":"box","text":"the right to redeem some or all of its shares in kind (valued in the same way as they would be valued for purposes of","page_number":145,"box":{"x":68,"y":814,"width":836,"height":11}},{"id":"4b2cb049-4059-44e8-a15d-7b0643e6ac2a","block_type":"box","text":"computing a Fund’s NAV), by delivery of securities and other assets selected from the Fund’s portfolio holdings at the","page_number":145,"box":{"x":69,"y":829,"width":840,"height":11}},{"id":"37d90b9f-98b1-46cb-bbee-bf1ea3864c8d","block_type":"box","text":"Manager’s discretion. In kind payment means payment will be made in portfolio securities and other assets rather","page_number":145,"box":{"x":70,"y":844,"width":814,"height":11}},{"id":"0edf80e3-46a4-4948-aaad-6df418ae7881","block_type":"box","text":"than cash. Redemptions in kind may be used in applicable circumstances, generally if the relevant shareholder is","page_number":145,"box":{"x":68,"y":859,"width":809,"height":11}},{"id":"1abd1c9c-0cb0-484c-ad6c-3bc7fa444a01","block_type":"box","text":"able to accept securities in kind, and may also be used in stressed market conditions. If this occurs, the redeeming","page_number":145,"box":{"x":69,"y":874,"width":827,"height":12}},{"id":"4c10be68-f41c-4996-9eac-d743daa1b3d0","block_type":"box","text":"shareholder might incur brokerage or other transaction costs to convert the securities and other assets to cash. Each","page_number":145,"box":{"x":69,"y":890,"width":839,"height":11}},{"id":"27de72b8-da12-42da-962a-28af305c1026","block_type":"box","text":"Fund has elected, however, to be governed by Rule 18f-1 under the Investment Company Act so that the Fund is","page_number":145,"box":{"x":70,"y":904,"width":797,"height":12}},{"id":"35331890-fcb8-477c-9f7b-469eb993c1ad","block_type":"box","text":"II-114","page_number":145,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"9849fd2c-ba8d-4e0c-873e-599c7c5f1828","block_type":"box","text":"NM0926U-5977317-145/232","page_number":145,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"9206c176-0773-49e0-925e-3747c70a04d4","block_type":"box","text":"obligated to redeem its shares solely in cash up to the lesser of $250,000 or 1% of its NAV during any 90-day period","page_number":146,"box":{"x":69,"y":44,"width":833,"height":12}},{"id":"370508ff-1785-49aa-a034-91d33b47dcaa","block_type":"box","text":"for any shareholder of the Fund.","page_number":146,"box":{"x":68,"y":60,"width":227,"height":11}},{"id":"3400e1f7-d5cb-45c4-be34-f1f836ab50c8","block_type":"box","text":"The redemption price is the NAV per share next determined after the initial receipt of proper notice of","page_number":146,"box":{"x":101,"y":82,"width":722,"height":11}},{"id":"4c20357c-b84a-4a10-8f0e-ba2eeb7ff3d2","block_type":"box","text":"redemption. The value of shares of each Fund at the time of redemption may be more or less than your cost at the","page_number":146,"box":{"x":69,"y":98,"width":818,"height":11}},{"id":"f60dc0ca-a03a-4b20-a5bf-ff993d23e6c1","block_type":"box","text":"time of purchase, depending in part on the market value of the securities held by the Fund at such time. Except for","page_number":146,"box":{"x":68,"y":113,"width":821,"height":11}},{"id":"aadf9785-e78d-4ecc-b4c8-76e6417f587a","block_type":"box","text":"any CDSC that may be applicable, there will be no redemption charge if your redemption request is sent directly to","page_number":146,"box":{"x":69,"y":128,"width":815,"height":11}},{"id":"09a78fcd-3469-4ba8-b359-af4a6fc87380","block_type":"box","text":"the Transfer Agent. If you are liquidating your holdings you will receive all dividends reinvested through the date of","page_number":146,"box":{"x":68,"y":143,"width":812,"height":11}},{"id":"71cd1fc5-09d7-4b03-a687-4faf358adb11","block_type":"box","text":"redemption.","page_number":146,"box":{"x":69,"y":158,"width":83,"height":11}},{"id":"cce38e73-23fd-4f0e-85e1-c1c4098810ca","block_type":"box","text":"The right to redeem shares may be suspended or payment upon redemption may be delayed for more than seven","page_number":146,"box":{"x":101,"y":181,"width":807,"height":11}},{"id":"0eb8a7c4-d520-49d1-a44d-48de681be3f8","block_type":"box","text":"days only (i) for any period during which trading on the NYSE is restricted as determined by the Commission or during","page_number":146,"box":{"x":69,"y":196,"width":835,"height":11}},{"id":"6c853d83-fe5c-44ec-ae74-4eb3e043519c","block_type":"box","text":"which the NYSE is closed (other than customary weekend and holiday closings), (ii) for any period during which an","page_number":146,"box":{"x":68,"y":211,"width":811,"height":11}},{"id":"8507ef93-e80e-4815-9d10-4c95e628d709","block_type":"box","text":"emergency exists, as defined by the Commission, as a result of which disposal of portfolio securities or","page_number":146,"box":{"x":69,"y":226,"width":741,"height":11}},{"id":"e76069a1-275e-4cd2-8de7-ede1ae0ffd97","block_type":"box","text":"determination of the NAV of a Fund is not reasonably practicable, or (iii) for such other periods as the Commission","page_number":146,"box":{"x":69,"y":241,"width":813,"height":11}},{"id":"212b684c-0695-4180-86f1-f19a76c2bbf1","block_type":"box","text":"may by order permit for the protection of shareholders of the Fund. (A Fund may also suspend or postpone the","page_number":146,"box":{"x":69,"y":256,"width":787,"height":11}},{"id":"1957724d-5ba6-4d84-ac5c-366cece56658","block_type":"box","text":"recordation of the transfer of its shares upon the occurrence of any of the foregoing conditions.)","page_number":146,"box":{"x":69,"y":271,"width":685,"height":12}},{"id":"92302821-d940-49b1-badf-5c059b4f5a8d","block_type":"box","text":"Each Fund, with other investment companies advised by the Manager, has entered into a joint committed line of","page_number":146,"box":{"x":102,"y":294,"width":798,"height":11}},{"id":"e40d27c8-5f32-44ac-ba11-0f48d58ef506","block_type":"box","text":"credit with a syndicate of banks that is intended to provide the Fund with a temporary source of cash to be used to","page_number":146,"box":{"x":69,"y":309,"width":820,"height":11}},{"id":"1d6547a4-a155-4b0b-8e7b-64ee61f657bf","block_type":"box","text":"meet redemption requests from shareholders in extraordinary or emergency circumstances.","page_number":146,"box":{"x":69,"y":324,"width":653,"height":12}},{"id":"929bc310-38ac-4f49-8efe-5fd38ac4afd0","block_type":"box","text":"Each Fund may redeem shares involuntarily to reimburse the Fund for any loss sustained by reason of the failure","page_number":146,"box":{"x":102,"y":347,"width":803,"height":11}},{"id":"ebba95c3-89d5-426b-9396-c0257823d181","block_type":"box","text":"of a shareholder to make full payment for shares purchased by the shareholder or to collect any charge relating to a","page_number":146,"box":{"x":69,"y":362,"width":827,"height":11}},{"id":"c71d83e1-8938-4294-8bb9-4b74c8f8221e","block_type":"box","text":"transaction effected for the benefit of a shareholder. Each Fund reserves the express right to redeem shares of the","page_number":146,"box":{"x":68,"y":377,"width":824,"height":12}},{"id":"4994ede0-b95b-421a-817b-bffc52e54eff","block_type":"box","text":"Fund involuntarily at any time if the Fund’s Board of Directors determines, in its sole discretion, that failure to do so","page_number":146,"box":{"x":70,"y":392,"width":825,"height":12}},{"id":"37257f0c-30c4-4f9c-91c5-857c5bcd0f31","block_type":"box","text":"may have adverse consequences to the holders of shares in the Fund. Upon such redemption the holders of shares","page_number":146,"box":{"x":69,"y":407,"width":825,"height":12}},{"id":"ad5f0d76-cac4-466f-99ff-fc3f2dcad63f","block_type":"box","text":"so redeemed shall have no further right with respect thereto other than to receive payment of the redemption price.","page_number":146,"box":{"x":69,"y":423,"width":823,"height":11}},{"id":"b93483b1-d76c-4a5f-9d41-a1c2138fd271","block_type":"box","text":"Redemption","page_number":146,"box":{"x":69,"y":453,"width":86,"height":11}},{"id":"47b1378b-85ca-40a1-b035-251f31b03077","block_type":"box","text":"Investor A, Investor A1, Investor C, Institutional and Class R Shares","page_number":146,"box":{"x":70,"y":476,"width":481,"height":10}},{"id":"4f766de2-6f50-46e9-b3af-a307cc858a6c","block_type":"box","text":"Redeem by Telephone:","page_number":146,"box":{"x":102,"y":498,"width":162,"height":11}},{"id":"4b868066-ea99-4f23-8795-5754635898c3","block_type":"box","text":"You may sell Investor Shares, excluding Investor P Shares, held at BlackRock by","page_number":146,"box":{"x":270,"y":498,"width":571,"height":11}},{"id":"e74f910a-9576-43f6-b310-31f2c2b4f170","block_type":"box","text":"telephone request if certain conditions are met and if the amount being sold is less than (i) $100,000 for payments","page_number":146,"box":{"x":68,"y":513,"width":829,"height":12}},{"id":"8d7d2208-efbc-4391-8121-b6d8e769b649","block_type":"box","text":"by check or (ii) $250,000 for payments through the Automated Clearing House Network (“ACH”) or wire transfer.","page_number":146,"box":{"x":69,"y":528,"width":798,"height":12}},{"id":"47506160-a79a-458f-8448-45e0fc438687","block_type":"box","text":"Certain redemption requests, such as those in excess of these amounts, and those where (i) the Fund does not have","page_number":146,"box":{"x":69,"y":543,"width":838,"height":12}},{"id":"89ac1927-4c17-4137-a96c-c1765893b5f9","block_type":"box","text":"verified banking information on file; or (ii) the proceeds are not paid to the record owner at the record address, must","page_number":146,"box":{"x":68,"y":559,"width":831,"height":11}},{"id":"a8854bec-2576-49a3-a150-e3137d356aca","block_type":"box","text":"be in writing with a medallion signature guarantee provided by any “eligible guarantor institution” as defined in Rule","page_number":146,"box":{"x":69,"y":574,"width":822,"height":11}},{"id":"e561ace0-7b9f-45ff-ac54-a8742eefaaea","block_type":"box","text":"17Ad-15 under the Securities Exchange Act of 1934 (the “Exchange Act”), whose existence and validity may be","page_number":146,"box":{"x":70,"y":589,"width":791,"height":11}},{"id":"61be71cb-ceb7-4855-87d2-89ffd34bfd09","block_type":"box","text":"verified by the Transfer Agent through the use of industry publications. For Institutional Shares, certain redemption","page_number":146,"box":{"x":68,"y":604,"width":818,"height":11}},{"id":"daea6fa0-abde-4679-a3dd-973a9b74b624","block_type":"box","text":"requests may require written instructions with a medallion signature guarantee. Call (800) 441-7762 for details. You","page_number":146,"box":{"x":69,"y":619,"width":829,"height":11}},{"id":"77888888-6115-4f8e-8d41-5a45f056f9dc","block_type":"box","text":"can obtain a medallion signature guarantee stamp from a bank, securities dealer, securities broker, credit union,","page_number":146,"box":{"x":69,"y":634,"width":803,"height":12}},{"id":"45f87b9b-4fd5-4ac6-ab2b-27f6525f25f0","block_type":"box","text":"savings and loan association, national securities exchange or registered securities association. The three recognized","page_number":146,"box":{"x":69,"y":650,"width":834,"height":11}},{"id":"184c4cc5-cd7d-4aa6-8108-d82b3bb879f1","block_type":"box","text":"medallion programs are Securities Transfer Agent Medallion Program, Stock Exchanges Medallion Program and New","page_number":146,"box":{"x":69,"y":664,"width":825,"height":12}},{"id":"bcf8b522-b129-4e4c-9c9f-248e8db522e2","block_type":"box","text":"York Stock Exchange, Inc. Medallion Signature Program. Signature guarantees which are not a part of these programs","page_number":146,"box":{"x":68,"y":680,"width":840,"height":11}},{"id":"828f2a23-72c1-4975-8a1e-e057ff5aa560","block_type":"box","text":"will not be accepted. A notary public seal will not be acceptable. Generally, a properly signed written request with any","page_number":146,"box":{"x":68,"y":695,"width":835,"height":11}},{"id":"c24a9658-cbb2-454e-84e2-0bd8c933e4e0","block_type":"box","text":"required signature guarantee is all that is required for a redemption. In some cases, however, other documents may","page_number":146,"box":{"x":69,"y":710,"width":828,"height":11}},{"id":"0c93fec5-7690-45a3-a9ce-f1cee6495b58","block_type":"box","text":"be necessary. Additional documentary evidence of authority is required by the Transfer Agent in the event redemption","page_number":146,"box":{"x":69,"y":725,"width":835,"height":11}},{"id":"bedeea2f-30b8-4231-adae-55c716c9e09a","block_type":"box","text":"is requested by a corporation, partnership, trust, fiduciary, executor or administrator.","page_number":146,"box":{"x":70,"y":740,"width":603,"height":11}},{"id":"b409577d-cd1f-4380-a89b-2f5727003f61","block_type":"box","text":"If you make a redemption request before a Fund has collected payment for the purchase of shares, the Fund","page_number":146,"box":{"x":102,"y":763,"width":774,"height":11}},{"id":"185bc085-add3-4982-a886-4915513eada3","block_type":"box","text":"may delay mailing your proceeds. This delay will usually not exceed ten days. A Fund, its Administrators and the","page_number":146,"box":{"x":69,"y":778,"width":795,"height":11}},{"id":"0c0ecaa3-fbe2-4e9d-946f-e87596956925","block_type":"box","text":"Distributor will employ reasonable procedures to confirm that instructions communicated by telephone are genuine.","page_number":146,"box":{"x":70,"y":793,"width":821,"height":11}},{"id":"63858dc3-3509-41e1-a84d-5740a07038ee","block_type":"box","text":"Telephone redemption requests will not be honored if: (i) the accountholder is deceased, (ii) the proceeds are to be","page_number":146,"box":{"x":68,"y":808,"width":823,"height":11}},{"id":"2b0ca091-5c49-4692-a750-e413451c8a14","block_type":"box","text":"sent to someone other than the shareholder of record, (iii) a Fund does not have verified information on file, (iv) the","page_number":146,"box":{"x":69,"y":823,"width":823,"height":11}},{"id":"0cce731d-7b42-434f-aadc-1460b14c8e44","block_type":"box","text":"request is by an individual other than the accountholder of record, (v) the account is held by joint tenants who are","page_number":146,"box":{"x":69,"y":838,"width":809,"height":11}},{"id":"29808f7f-95a1-4a27-b596-3872b9caa4a6","block_type":"box","text":"divorced, (vi) the address on the account has changed within the last 30 days or share certificates have been issued","page_number":146,"box":{"x":69,"y":853,"width":833,"height":12}},{"id":"5141729a-c914-4d33-8c27-fc4114dd8792","block_type":"box","text":"on the account, or (vii) to protect against fraud, if the caller is unable to provide the account number, the name and","page_number":146,"box":{"x":69,"y":869,"width":821,"height":11}},{"id":"f9df8ec3-94f3-4866-8155-daffae49026d","block_type":"box","text":"address registered on the account and the social security number registered on the account. The Fund and its","page_number":146,"box":{"x":69,"y":884,"width":785,"height":11}},{"id":"ba1b6747-9e27-43f5-8a54-317d9b6e7b4c","block_type":"box","text":"service providers will not be liable for any loss, liability, cost or expense for acting upon telephone instructions that","page_number":146,"box":{"x":69,"y":899,"width":820,"height":11}},{"id":"c7d4b1ac-b566-4f23-9391-759c9f828a74","block_type":"box","text":"II-115","page_number":146,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"d8957bcb-f4e1-462b-945c-e22f91e5e71a","block_type":"box","text":"NM0926U-5977317-146/232","page_number":146,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"771e503e-06d6-4da8-b00e-d7278939b0eb","block_type":"box","text":"are reasonably believed to be genuine in accordance with such procedures. Before telephone requests will be","page_number":147,"box":{"x":69,"y":45,"width":782,"height":11}},{"id":"3e1417df-10e2-4fbb-8c5c-7b7f5151c2e6","block_type":"box","text":"honored, signature approval from all shareholders of record on the account must be obtained. The Fund may refuse a","page_number":147,"box":{"x":69,"y":60,"width":838,"height":11}},{"id":"b08e95cc-2d27-4e87-9063-efce551473cf","block_type":"box","text":"telephone redemption request if it believes it is advisable to do so. During periods of substantial economic or market","page_number":147,"box":{"x":68,"y":75,"width":837,"height":11}},{"id":"eece8c81-4c8d-4b12-b8f6-cc897410ebf4","block_type":"box","text":"change, telephone redemptions may be difficult to complete. Please find below alternative redemption methods.","page_number":147,"box":{"x":69,"y":90,"width":800,"height":11}},{"id":"4098b77f-1e9a-4510-afc7-82630a9b7ea3","block_type":"box","text":"Redemption orders for Institutional Shares placed prior to 4:00 p.m. (Eastern time) on a business day will be","page_number":147,"box":{"x":102,"y":113,"width":776,"height":11}},{"id":"0b3b4cc1-5844-4fbc-8044-c86d3a2270ac","block_type":"box","text":"priced at the NAV determined that day. If redemption orders are received by 4:00 p.m. (Eastern time) on a business","page_number":147,"box":{"x":70,"y":128,"width":823,"height":11}},{"id":"b76a3802-cef4-40e6-8edb-fa1c1c48c1de","block_type":"box","text":"day, payment for redeemed Institutional Shares will normally be wired in Federal Funds on the next business day. If","page_number":147,"box":{"x":69,"y":143,"width":820,"height":11}},{"id":"1a2dc03c-f2dc-43c0-a660-fb2238b84387","block_type":"box","text":"the Federal Reserve Bank of Philadelphia is not open on the business day following receipt of the redemption order,","page_number":147,"box":{"x":68,"y":158,"width":826,"height":11}},{"id":"c3c1710d-ff88-43f9-a4b8-d812400dfd73","block_type":"box","text":"the redemption order will be accepted and processed the next succeeding business day when the Federal Reserve","page_number":147,"box":{"x":68,"y":173,"width":817,"height":11}},{"id":"3cd062e1-a20e-48b8-84f7-6b2c4d56239d","block_type":"box","text":"Bank of Philadelphia is open, provided that the Fund’s custodian is also open for business.","page_number":147,"box":{"x":70,"y":188,"width":648,"height":11}},{"id":"79f83b3e-cb25-4790-aea9-8cccc3cf7fbc","block_type":"box","text":"Redeem by VRU:","page_number":147,"box":{"x":102,"y":211,"width":120,"height":11}},{"id":"57d866b5-f20a-40af-8539-e400ada8ee20","block_type":"box","text":"Investor class shares, excluding Investor P Shares, may also be redeemed by use of a Fund’s","page_number":147,"box":{"x":229,"y":211,"width":667,"height":11}},{"id":"2a3e47d5-29d8-40a1-bf54-901ac5e89f42","block_type":"box","text":"automated voice response unit service (“VRU”). Payment for Investor class shares redeemed by VRU may be made","page_number":147,"box":{"x":69,"y":226,"width":820,"height":11}},{"id":"681a12b8-126d-45ee-8aba-b81906b37602","block_type":"box","text":"for non-retirement accounts in amounts up to $25,000, either through check, ACH or wire.","page_number":147,"box":{"x":68,"y":241,"width":644,"height":11}},{"id":"22193c82-f10f-4c43-8cd4-29d0f804e5ab","block_type":"box","text":"Redeem by Internet:","page_number":147,"box":{"x":102,"y":264,"width":147,"height":11}},{"id":"8503c26f-ca62-4b8f-a009-4182e8aa8c3e","block_type":"box","text":"Certain Investor and Institutional class shares may also be redeemed by logging onto the","page_number":147,"box":{"x":255,"y":264,"width":637,"height":11}},{"id":"36cb8aea-489d-48c1-95e1-a96399ea4759","block_type":"box","text":"BlackRock website at www.blackrock.com. Proceeds from Internet redemptions may be sent via check, ACH or wire to","page_number":147,"box":{"x":70,"y":279,"width":836,"height":11}},{"id":"6a7d2a6c-43e2-42a1-b07b-7d964b02a6ed","block_type":"box","text":"the bank account of record. Payment for shares redeemed by Internet may be made for non-retirement accounts up","page_number":147,"box":{"x":68,"y":294,"width":823,"height":11}},{"id":"9b7a409c-b760-4e13-b171-c7741297c302","block_type":"box","text":"to $100,000 per account per day, either through check, ACH or wire. Different maximums may apply to certain","page_number":147,"box":{"x":68,"y":309,"width":789,"height":11}},{"id":"983d8a32-e860-4e7e-806e-99dff32e14cb","block_type":"box","text":"institutional investors.","page_number":147,"box":{"x":70,"y":325,"width":155,"height":8}},{"id":"61d2e35f-f730-49df-8a7d-c960356a2611","block_type":"box","text":"Redeem in Writing:","page_number":147,"box":{"x":102,"y":347,"width":137,"height":11}},{"id":"89a6fb1e-20ec-43bd-a31c-09c6c8ef16f3","block_type":"box","text":"If you hold shares with the Transfer Agent you may redeem such shares without charge by","page_number":147,"box":{"x":247,"y":347,"width":639,"height":11}},{"id":"4b420557-32a0-4b81-99b0-1164040c0f4d","block_type":"box","text":"writing to BlackRock, P.O. Box 534429, Pittsburgh, Pennsylvania 15253-4429. Redemption requests delivered other","page_number":147,"box":{"x":68,"y":362,"width":831,"height":11}},{"id":"44d37fa5-1019-4915-b5c1-e7ba2db58f93","block_type":"box","text":"than by mail should be sent to BlackRock, Attention: 534429, 1350 Penn Avenue Suite 102, Pittsburgh,","page_number":147,"box":{"x":68,"y":377,"width":745,"height":12}},{"id":"50d8290a-7215-4297-a16e-ad95a3f5e24a","block_type":"box","text":"Pennsylvania 15222. If you hold share certificates issued by your Fund, the letter must be accompanied by","page_number":147,"box":{"x":69,"y":392,"width":764,"height":12}},{"id":"c5e07b03-c321-4056-a4bc-3327a6fa459b","block_type":"box","text":"certificates for the shares. All shareholders on the account must sign the letter. A medallion signature guarantee will","page_number":147,"box":{"x":69,"y":407,"width":831,"height":12}},{"id":"e9f70a37-79c1-400b-9610-745a628b688e","block_type":"box","text":"generally be required but may be waived in certain limited circumstances. You can obtain a medallion signature","page_number":147,"box":{"x":68,"y":423,"width":794,"height":11}},{"id":"6893c196-3314-4195-b6ce-73e78b7e894f","block_type":"box","text":"guarantee stamp from a bank, securities dealer, securities broker, credit union, savings and loan association,","page_number":147,"box":{"x":68,"y":438,"width":782,"height":11}},{"id":"299fda68-7f35-426e-93d2-66136520d0ef","block_type":"box","text":"national securities exchange or registered securities association. A notary public seal will not be acceptable. If you","page_number":147,"box":{"x":69,"y":453,"width":817,"height":11}},{"id":"acb866a6-fe56-4e7f-8991-e380981d3c67","block_type":"box","text":"hold stock certificates, return the certificates with the letter. Proceeds from redemptions may be sent via check, ACH","page_number":147,"box":{"x":69,"y":468,"width":836,"height":11}},{"id":"8e772c4a-953c-4867-b5af-99ed49ce9eae","block_type":"box","text":"or wire to the bank account of record.","page_number":147,"box":{"x":69,"y":483,"width":266,"height":9}},{"id":"116c43dc-844e-400d-9c6c-196ca071bdd4","block_type":"box","text":"Redemptions of Investor P Shares, Service Shares, Class G Shares, Class K Shares and BlackRock Shares may","page_number":147,"box":{"x":102,"y":506,"width":802,"height":11}},{"id":"cee5cf60-7afd-4ece-b4b5-a74ef74b7d16","block_type":"box","text":"be made in the manner and amounts described in the Prospectuses.","page_number":147,"box":{"x":69,"y":521,"width":489,"height":11}},{"id":"0ffdc090-568d-4810-be79-a4f37b3967db","block_type":"box","text":"The Funds or the Transfer Agent may temporarily suspend telephone transactions at any time.","page_number":147,"box":{"x":101,"y":543,"width":668,"height":12}},{"id":"897b0c2e-e556-4bb4-85ad-3fcb17bcf6bd","block_type":"box","text":"If you redeem shares directly with the Transfer Agent, payments will generally be mailed within one business day","page_number":147,"box":{"x":102,"y":566,"width":800,"height":11}},{"id":"002a0450-89c9-4f08-9abf-60efc3524a98","block_type":"box","text":"of receipt of the proper notice of redemption. A Fund may delay the mailing of a redemption check until good payment","page_number":147,"box":{"x":69,"y":581,"width":838,"height":12}},{"id":"48a94275-1d1e-48df-bc35-ba25280da8cc","block_type":"box","text":"(that is, cash, Federal funds or certified check drawn on a U.S. bank) has been collected for the purchase of Fund","page_number":147,"box":{"x":69,"y":596,"width":811,"height":11}},{"id":"eb44e91b-1461-43f5-8b43-8da365f1b0ef","block_type":"box","text":"shares, which delay will usually not exceed 10 days. If your account is held directly with the Transfer Agent and","page_number":147,"box":{"x":69,"y":612,"width":789,"height":11}},{"id":"f5907832-37cd-4e63-bac6-2ca334518170","block_type":"box","text":"contains a fractional share balance following a redemption, the fractional share balance will be automatically","page_number":147,"box":{"x":69,"y":627,"width":775,"height":11}},{"id":"f638dc1a-8d1e-4300-9a87-4a566e81a8bc","block_type":"box","text":"redeemed by the Fund.","page_number":147,"box":{"x":69,"y":642,"width":162,"height":11}},{"id":"13d68eae-fefb-4c24-a1e4-d032b1c86515","block_type":"box","text":"Note on Low Balance Accounts.","page_number":147,"box":{"x":102,"y":665,"width":223,"height":8}},{"id":"2559961f-9aa2-4b0a-b0ab-d80087d5e9ce","block_type":"box","text":"Because of the high cost of maintaining smaller shareholder accounts,","page_number":147,"box":{"x":332,"y":664,"width":503,"height":12}},{"id":"4b99ffc0-8498-46f8-beb2-ed9af30210bd","block_type":"box","text":"BlackRock has set a minimum balance of $500 in each Fund position you hold within your account (“Fund","page_number":147,"box":{"x":70,"y":679,"width":752,"height":12}},{"id":"fdb1af2e-6f71-47b7-9795-68ec15e21458","block_type":"box","text":"Minimum”), and may redeem the shares in your account if the NAV of those shares in your account falls below $500","page_number":147,"box":{"x":70,"y":694,"width":829,"height":12}},{"id":"80ba5ca8-fef4-4d1a-bc78-755ea0025161","block_type":"box","text":"for any reason, including market fluctuation.","page_number":147,"box":{"x":68,"y":710,"width":313,"height":11}},{"id":"93e561c3-0855-4a02-9876-55476726dbfe","block_type":"box","text":"You will be notified that the value of your account is less than the Fund Minimum before the Fund makes any","page_number":147,"box":{"x":101,"y":732,"width":775,"height":12}},{"id":"49bc2857-ab72-4243-b353-f52e58feb9fc","block_type":"box","text":"involuntary redemption. This notification will provide you with a 90 calendar day period to make an additional","page_number":147,"box":{"x":70,"y":748,"width":773,"height":11}},{"id":"f494b774-6f3b-40c2-908f-6e5a5c87c669","block_type":"box","text":"investment in order to bring the value of your account to at least $500 before the Fund makes an involuntary","page_number":147,"box":{"x":70,"y":762,"width":776,"height":12}},{"id":"b585f626-1e62-4b7a-8a14-5ac137753c24","block_type":"box","text":"redemption. This involuntary redemption will not charge any deferred sales charge, and may not apply to accounts of","page_number":147,"box":{"x":69,"y":778,"width":834,"height":11}},{"id":"cd4bf71b-4e44-41a5-96eb-8edb8116c3ad","block_type":"box","text":"certain employer-sponsored retirement plans (not including IRAs), qualified state tuition plan (529 Plan) accounts,","page_number":147,"box":{"x":69,"y":793,"width":811,"height":11}},{"id":"1b255e5b-5879-486c-91e6-6ad393ee60c5","block_type":"box","text":"and select fee-based programs at your financial intermediary.","page_number":147,"box":{"x":69,"y":808,"width":435,"height":11}},{"id":"00ef9376-6974-4399-ada4-acfc29414a4c","block_type":"box","text":"Redemptions in Kind:","page_number":147,"box":{"x":102,"y":831,"width":153,"height":11}},{"id":"c787ed78-aa52-4ee1-ac64-9e76f362f4ac","block_type":"box","text":"Each Fund reserves the right to honor any request for redemption by making payment in","page_number":147,"box":{"x":263,"y":831,"width":624,"height":11}},{"id":"38593dbc-3db0-4940-99a6-47ff1df2c38f","block_type":"box","text":"whole or in part by delivering securities valued in the same way as they would be valued for purposes of computing a","page_number":147,"box":{"x":68,"y":846,"width":833,"height":11}},{"id":"712dbd2d-6f8f-4f41-ac22-effaf3a767f5","block_type":"box","text":"Fund’s NAV, except that each Fund is obligated to redeem shares solely in cash up to the lesser of $250,000 or 1%","page_number":147,"box":{"x":70,"y":860,"width":825,"height":12}},{"id":"80f36b6c-5726-4928-b985-881b012a2ea3","block_type":"box","text":"of the Fund’s NAV during any 90-day period for any one shareholder. Redemptions in excess of those amounts will","page_number":147,"box":{"x":69,"y":876,"width":811,"height":11}},{"id":"1d568bde-9dea-4360-baab-af4e2e175124","block_type":"box","text":"normally be paid in cash but may be paid wholly or partly by a distribution in kind of securities.","page_number":147,"box":{"x":69,"y":891,"width":672,"height":11}},{"id":"141c618a-7982-4409-9052-86effb12cef9","block_type":"box","text":"II-116","page_number":147,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"f81774b1-8b59-4a40-a306-f492ec50368f","block_type":"box","text":"NM0926U-5977317-147/232","page_number":147,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"06db0bd0-ee78-4483-86e0-0b50c8a7c989","block_type":"box","text":"The specific security or securities to be distributed will be determined by the Manager and could include a pro","page_number":148,"box":{"x":101,"y":45,"width":787,"height":11}},{"id":"835047bc-3f0d-4cbf-ae17-69ad0fc5b14c","block_type":"box","text":"rata representation of the Fund’s portfolio or a non-pro-rata representation of the Fund’s portfolio depending upon","page_number":148,"box":{"x":69,"y":60,"width":812,"height":11}},{"id":"ac0f276a-d8c1-4a23-892b-a0f5d7de6ce7","block_type":"box","text":"various circumstances and subject to the Funds’ policies and procedures and any applicable laws or regulations. In","page_number":148,"box":{"x":68,"y":75,"width":822,"height":11}},{"id":"16c207ec-dff5-4644-bc5e-ba1ba0f53ced","block_type":"box","text":"effecting such redemption in kind, the Manager may select securities to distribute to the redeeming shareholder by","page_number":148,"box":{"x":69,"y":90,"width":822,"height":11}},{"id":"9fd2f6d5-2f5b-4292-a8d3-6d6731f6e3b3","block_type":"box","text":"considering certain factors, including, without limitation, the portfolio management team’s model or optimal portfolio,","page_number":148,"box":{"x":69,"y":105,"width":838,"height":11}},{"id":"33b828fe-3a96-44e6-9fb8-e573c44606a8","block_type":"box","text":"risk management considerations, compliance considerations, the active positioning of a Fund post-redemption, the","page_number":148,"box":{"x":69,"y":120,"width":818,"height":12}},{"id":"0d79165d-43a9-4f79-b6d0-dc465b14d761","block_type":"box","text":"liquidity of the securities, and the tax basis of the securities. There is no assurance that BlackRock will select to","page_number":148,"box":{"x":70,"y":135,"width":801,"height":11}},{"id":"e6f07aa8-d3e3-411a-9646-d041b23a5d21","block_type":"box","text":"retain those securities that will perform the best. An Index Fund may deviate from pro rata redemptions but will seek","page_number":148,"box":{"x":69,"y":150,"width":832,"height":12}},{"id":"dd6ff897-5fb9-4601-90bd-8ffd0987d8eb","block_type":"box","text":"for the securities and other assets to be distributed to be deemed to be a fair representation of portfolio holdings","page_number":148,"box":{"x":68,"y":166,"width":812,"height":11}},{"id":"0ec240ac-2bef-4221-b68f-ee6cd1a9c968","block_type":"box","text":"and the interests of the remaining shareholders in the Index Fund to not be diluted.","page_number":148,"box":{"x":69,"y":181,"width":594,"height":11}},{"id":"20f38a28-6080-42bd-865d-a32634c09ca6","block_type":"box","text":"The Funds may effect redemptions in kind in an effort to, among other considerations: (a) manage the portfolio","page_number":148,"box":{"x":101,"y":203,"width":795,"height":12}},{"id":"c97aeeb2-16b6-4883-a78e-9d9162505e10","block_type":"box","text":"efficiently or for any other portfolio management purpose, and (b) externalize certain transaction costs that would","page_number":148,"box":{"x":69,"y":218,"width":810,"height":12}},{"id":"7b22f885-4127-45ad-ba37-7f0e0d54467d","block_type":"box","text":"otherwise be borne by a Fund in connection with redemption activity or portfolio turnover. Redemptions in kind may","page_number":148,"box":{"x":69,"y":234,"width":820,"height":11}},{"id":"d66daf12-acf8-4862-bffa-a0cf3689f87e","block_type":"box","text":"reduce the need for the Fund to maintain short-term cash reserves, reduce Fund transaction costs, reduce the need","page_number":148,"box":{"x":69,"y":249,"width":828,"height":10}},{"id":"a12d557d-8837-49e5-95fe-1ddcd0adeef7","block_type":"box","text":"for the Fund to sell its investments at inopportune times, and lower Fund capital gain recognition, all of which may be","page_number":148,"box":{"x":68,"y":264,"width":838,"height":11}},{"id":"2e9cdf0d-02fb-497b-8820-617c1ab9fd4b","block_type":"box","text":"considerations when determining whether to effect a redemption in kind. However, there can be no assurance that","page_number":148,"box":{"x":69,"y":279,"width":817,"height":11}},{"id":"526b9d2c-b700-40aa-983f-6a821b48148d","block_type":"box","text":"redemptions in kind can or will be effected when they would be beneficial to a Fund, and it may be impractical or","page_number":148,"box":{"x":69,"y":294,"width":802,"height":11}},{"id":"04c14fee-79e2-4313-9699-2a4eb52cab89","block_type":"box","text":"impossible to effect redemptions in kind with many or substantially all of the Fund’s shareholders because of, among","page_number":148,"box":{"x":70,"y":309,"width":837,"height":11}},{"id":"30c4cffb-f27c-44f8-90b5-c2c3f4f3d621","block_type":"box","text":"other things, how they hold their Fund shares or the small value of the redemptions.","page_number":148,"box":{"x":69,"y":324,"width":598,"height":12}},{"id":"13a1dcba-c1a6-41d7-92d0-1df19458f5da","block_type":"box","text":"In some circumstances, in order to meet Fund liquidity needs, for optimization of the Fund’s portfolio, or a","page_number":148,"box":{"x":102,"y":347,"width":756,"height":11}},{"id":"c68e0097-5340-4ece-8186-c28701e31734","block_type":"box","text":"combination thereof, a Fund, in its discretion, may accept large purchase orders from one or more financial","page_number":148,"box":{"x":69,"y":362,"width":764,"height":11}},{"id":"64f889e4-f969-442e-a55e-e3fb279afd31","block_type":"box","text":"institutions that are willing, upon redemption of their investment in the Fund, to receive their redemption proceeds in","page_number":148,"box":{"x":70,"y":377,"width":830,"height":12}},{"id":"ac261428-19fb-4dc0-98ea-d4f50f2076c2","block_type":"box","text":"kind rather than in cash. A Fund’s ability to pay these redemption proceeds in kind relieves the Fund of the need of","page_number":148,"box":{"x":69,"y":392,"width":821,"height":12}},{"id":"ec3b26bc-7849-463b-9b69-ea7cc11d1c1d","block_type":"box","text":"the Fund to sell the securities that are distributed in kind and incur brokerage and other transaction costs associated","page_number":148,"box":{"x":68,"y":408,"width":837,"height":11}},{"id":"92b059fb-1f27-4693-b317-43ce055d1dd2","block_type":"box","text":"with such sale, and may have the effect of reducing the amount of taxable gains the Fund would otherwise be","page_number":148,"box":{"x":68,"y":423,"width":784,"height":11}},{"id":"ed9aeb03-8fde-4390-be5a-249c1e8dc09d","block_type":"box","text":"required to distribute to shareholders. A Fund’s ability to engage in such transactions is subject to, among other","page_number":148,"box":{"x":69,"y":438,"width":801,"height":11}},{"id":"3d2ee935-5b5c-482a-8912-b70ee9bc6abb","block_type":"box","text":"things, limitations on frequency of redemptions in kind under the Fund’s policies and availability of shareholders able","page_number":148,"box":{"x":68,"y":453,"width":835,"height":11}},{"id":"6030af9b-d279-4ebe-833f-cafa7bea893c","block_type":"box","text":"to transact in kind, and there is no assurance that the Fund can or will effect any redemptions in kind. Financial","page_number":148,"box":{"x":68,"y":468,"width":796,"height":11}},{"id":"7dc1f281-144a-41bb-9317-50adcecf39e0","block_type":"box","text":"institutions that participate in the transactions described in this sub-section do not receive a fee from the Fund for","page_number":148,"box":{"x":70,"y":483,"width":816,"height":11}},{"id":"e5ff6786-f44c-440b-9e6f-201c0c51b22f","block_type":"box","text":"doing so. The Funds’ short-term trading policy shall not apply to the transactions described in this sub-section.","page_number":148,"box":{"x":69,"y":498,"width":788,"height":11}},{"id":"54daccff-466e-4f93-8d99-9077c34c5a69","block_type":"box","text":"If you receive securities through a redemption in kind, and desire to convert them to cash, you may pay taxes","page_number":148,"box":{"x":102,"y":521,"width":779,"height":11}},{"id":"3b8b1df3-2a3d-4119-82d3-ef7ba856e859","block_type":"box","text":"and brokerage and other transaction costs to dispose of the securities. You may also receive less for the securities","page_number":148,"box":{"x":69,"y":536,"width":823,"height":11}},{"id":"9054255a-3b70-4400-bf66-1b9defc40be4","block_type":"box","text":"than the price at which they were valued for purposes of effecting the redemption. There may also be a risk that","page_number":148,"box":{"x":68,"y":551,"width":800,"height":11}},{"id":"2481e410-f792-4ff6-8808-ef844dc30d83","block_type":"box","text":"redemption in kind activity could negatively impact the market value of the securities distributed in kind and, in turn,","page_number":148,"box":{"x":69,"y":566,"width":826,"height":11}},{"id":"d41d897d-80e8-4a19-ae7a-2b4612236d4b","block_type":"box","text":"the NAV of the corresponding Fund.","page_number":148,"box":{"x":68,"y":581,"width":251,"height":12}},{"id":"390b1b6f-d2e3-4904-885c-bcf4ad5ff236","block_type":"box","text":"Repurchase","page_number":148,"box":{"x":69,"y":612,"width":85,"height":11}},{"id":"1fde992b-f100-4819-89f7-efb57f0e1a59","block_type":"box","text":"A Fund normally will accept orders to repurchase shares from Selling Dealers for their customers. Shares will be","page_number":148,"box":{"x":101,"y":634,"width":800,"height":12}},{"id":"f4f28afb-6c25-425e-af39-c1fd51808cf3","block_type":"box","text":"priced at the NAV of the Fund next determined after receipt of the repurchase order by a Selling Dealer that has been","page_number":148,"box":{"x":70,"y":649,"width":833,"height":12}},{"id":"a1ecbc62-238a-4e26-bdf4-49beb2ba2e6a","block_type":"box","text":"authorized by the Distributor by contract to accept such orders. As to repurchase orders received by Selling Dealers","page_number":148,"box":{"x":69,"y":665,"width":822,"height":11}},{"id":"f3620d08-a3a8-4e92-8728-86ecdc39e10e","block_type":"box","text":"prior to the close of business on the NYSE (generally, the NYSE closes at 4:00 p.m. Eastern time), on the day the","page_number":148,"box":{"x":70,"y":680,"width":809,"height":11}},{"id":"d9c79002-b599-4465-bdbd-25e30857a4a4","block_type":"box","text":"order is placed, which includes orders received after the close of business on the previous day, the repurchase price","page_number":148,"box":{"x":69,"y":695,"width":831,"height":11}},{"id":"9599ca83-eb6a-4ffb-b5dd-d6e20af1a617","block_type":"box","text":"is the NAV determined as of the close of business on the NYSE on that day. If the orders for repurchase are not","page_number":148,"box":{"x":70,"y":710,"width":796,"height":11}},{"id":"e41226d7-e7c3-4890-89a8-8ef408c256c8","block_type":"box","text":"received by the Selling Dealer before the close of business on the NYSE, such orders are deemed received on the","page_number":148,"box":{"x":69,"y":725,"width":812,"height":11}},{"id":"a428aceb-2e3d-499c-8753-bc34d29694c2","block_type":"box","text":"next business day.","page_number":148,"box":{"x":69,"y":740,"width":130,"height":11}},{"id":"1e0e17a3-4ca4-4808-bbf7-7afb6a40909a","block_type":"box","text":"These repurchase arrangements are for your convenience and do not involve a charge by the Fund (other than","page_number":148,"box":{"x":101,"y":763,"width":783,"height":11}},{"id":"4c395617-38d0-4f6c-8e68-4675c2f0b688","block_type":"box","text":"any applicable CDSC or redemption fee). However, Selling Dealers may charge a processing fee in connection with","page_number":148,"box":{"x":69,"y":778,"width":813,"height":11}},{"id":"577783b2-f63e-44c6-9916-54661a3f4a7d","block_type":"box","text":"such transactions. In addition, securities firms that do not have selected dealer agreements with the Distributor may","page_number":148,"box":{"x":69,"y":793,"width":832,"height":11}},{"id":"2a7677a9-7c8a-4743-8323-04176b4248a4","block_type":"box","text":"impose a transaction charge for transmitting the notice of repurchase to the Fund. Each Fund reserves the right to","page_number":148,"box":{"x":70,"y":808,"width":814,"height":11}},{"id":"1b0a9a41-c712-4eb3-94b3-4336c14fa442","block_type":"box","text":"reject any order for repurchase. A shareholder whose order for repurchase is rejected by a Fund, however, may","page_number":148,"box":{"x":69,"y":823,"width":788,"height":11}},{"id":"754311a9-5666-4311-b22f-5345902ade53","block_type":"box","text":"redeem shares as set out above.","page_number":148,"box":{"x":69,"y":839,"width":235,"height":8}},{"id":"4865b377-8151-45a6-bf7d-b0b46322e994","block_type":"box","text":"II-117","page_number":148,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"d0d57acc-fc47-47c0-825f-6a0bc5ae128d","block_type":"box","text":"NM0926U-5977317-148/232","page_number":148,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"21eb5e77-9dae-45fc-9c6f-7e5bcc08fc5d","block_type":"box","text":"Reinstatement Privilege — Investor A and Investor P Shares","page_number":149,"box":{"x":69,"y":45,"width":440,"height":11}},{"id":"378faae4-679e-40fe-836b-d85c55915dab","block_type":"box","text":"Upon redemption of Investor A, Investor A1, Investor P or Institutional Shares, as applicable, shareholders may","page_number":149,"box":{"x":102,"y":67,"width":791,"height":11}},{"id":"6bf8bbd6-1ed6-4d74-90f1-a4fa77081f21","block_type":"box","text":"reinvest all or a portion of their redemption proceeds (after paying any applicable CDSC) in Investor A or Investor P","page_number":149,"box":{"x":69,"y":82,"width":815,"height":12}},{"id":"994f22db-4d77-4628-ad5e-8b0eb8ca48df","block_type":"box","text":"Shares of the same or another BlackRock fund without paying a front-end sales charge. This right may be exercised","page_number":149,"box":{"x":69,"y":98,"width":822,"height":11}},{"id":"5642ad88-f32c-4f19-bae1-76ab9485711c","block_type":"box","text":"within 90 days of the redemption, provided that the Investor A or Investor P Shares, as applicable, of that fund is","page_number":149,"box":{"x":68,"y":113,"width":806,"height":11}},{"id":"025136d9-b70d-4abe-8f79-d1b1015ad8f6","block_type":"box","text":"currently open to new investors or the shareholder has a current account in that closed fund. Shares will be","page_number":149,"box":{"x":69,"y":128,"width":768,"height":11}},{"id":"fff6d6fd-2589-43fe-a6ac-0469f78c984d","block_type":"box","text":"purchased at the NAV calculated at the close of trading on the day the request is received in good order. To exercise","page_number":149,"box":{"x":70,"y":143,"width":827,"height":11}},{"id":"b2008a6c-4482-4b25-b8a9-5060fcfe7049","block_type":"box","text":"this privilege, the Transfer Agent must receive written notification from the shareholder of record or the registered","page_number":149,"box":{"x":68,"y":158,"width":809,"height":11}},{"id":"adbeee5e-583f-48f9-a1f6-0704172ae01c","block_type":"box","text":"representative of record, at the time of purchase. Investors should consult a tax advisor concerning the tax","page_number":149,"box":{"x":69,"y":173,"width":764,"height":11}},{"id":"5feb85dc-8452-4152-89bb-4bbf6dee472f","block_type":"box","text":"consequences of exercising this reinstatement privilege.","page_number":149,"box":{"x":69,"y":188,"width":400,"height":12}},{"id":"4527c225-7935-48ac-a05a-5c1a3eb693da","block_type":"box","text":"SHAREHOLDER SERVICES","page_number":149,"box":{"x":384,"y":218,"width":210,"height":9}},{"id":"43e4f903-d8d9-4449-b35d-c36308ad401c","block_type":"box","text":"Each Fund offers one or more of the shareholder services described below that are designed to facilitate","page_number":149,"box":{"x":102,"y":241,"width":747,"height":11}},{"id":"420339b8-a84e-4385-9e86-daaf7085e2e1","block_type":"box","text":"investment in its shares. You can obtain more information about these services from each Fund by calling the","page_number":149,"box":{"x":70,"y":256,"width":781,"height":11}},{"id":"88ff8a58-d712-45d7-92e1-05fb5e56ff1c","block_type":"box","text":"telephone number on the cover page, or from the Distributor, your financial adviser, your selected securities dealer or","page_number":149,"box":{"x":68,"y":271,"width":836,"height":11}},{"id":"ce79ff6a-1206-40ea-bb32-c80cc916d660","block_type":"box","text":"other financial intermediary. Certain of these services are available only to U.S. investors.","page_number":149,"box":{"x":69,"y":286,"width":641,"height":11}},{"id":"91f453f1-f0b9-4759-aafb-fd62c82efd41","block_type":"box","text":"Investment Account","page_number":149,"box":{"x":69,"y":316,"width":146,"height":9}},{"id":"b7831bc5-df78-4057-802f-8b672dc91879","block_type":"box","text":"If your account is maintained at the Transfer Agent (an “Investment Account”) you will receive statements, at","page_number":149,"box":{"x":102,"y":339,"width":774,"height":11}},{"id":"1befc704-bb0f-4c49-a34a-0fa75915d364","block_type":"box","text":"least quarterly, from the Transfer Agent. These statements will serve as confirmations for automatic investment","page_number":149,"box":{"x":70,"y":354,"width":796,"height":11}},{"id":"1f68e668-0d3e-4f8c-9e28-9f41ded40d04","block_type":"box","text":"purchases and the reinvestment of dividends. The statements also will show any other activity in your Investment","page_number":149,"box":{"x":70,"y":369,"width":807,"height":11}},{"id":"d867712b-00eb-48c6-be53-5ddb7f8d021d","block_type":"box","text":"Account since the last statement. You also will receive separate confirmations for each purchase or sale transaction","page_number":149,"box":{"x":68,"y":384,"width":830,"height":11}},{"id":"ca752ccb-f7c3-4118-b057-0accf2f3c168","block_type":"box","text":"other than automatic investment purchases and the reinvestment of dividends. If your Investment Account is held at","page_number":149,"box":{"x":69,"y":399,"width":829,"height":11}},{"id":"d6923a4a-6a55-424f-a740-e34bd35a64cf","block_type":"box","text":"the Transfer Agent you may make additions to it at any time by mailing a check directly to the Transfer Agent. Each","page_number":149,"box":{"x":68,"y":414,"width":815,"height":12}},{"id":"b9dfcde1-5227-4ce4-aaf3-0f855f6130e5","block_type":"box","text":"Fund limits purchases by personal check to $500,000 per trade. You may also maintain an account through a","page_number":149,"box":{"x":70,"y":429,"width":781,"height":12}},{"id":"125fb181-4249-4f60-9593-0f916571e6e6","block_type":"box","text":"selected securities dealer or other financial intermediary. If you transfer shares out of an account maintained with a","page_number":149,"box":{"x":69,"y":445,"width":825,"height":11}},{"id":"ddb8783e-d9df-4a04-b41a-f5f35cb711aa","block_type":"box","text":"selected securities dealer or other financial intermediary, an Investment Account in your name may be opened","page_number":149,"box":{"x":69,"y":460,"width":785,"height":11}},{"id":"b6b4366e-a516-40f6-a7a5-446ac529b6ef","block_type":"box","text":"automatically at the Transfer Agent.","page_number":149,"box":{"x":69,"y":475,"width":251,"height":11}},{"id":"2af899d5-8bff-4679-ad82-7ae51b35cbea","block_type":"box","text":"You may transfer Fund shares from a selected securities dealer or other financial intermediary to another","page_number":149,"box":{"x":101,"y":498,"width":750,"height":11}},{"id":"c1831b29-d92a-4e46-a550-500492184faa","block_type":"box","text":"securities dealer or other financial intermediary that has entered into an agreement with the Distributor. Certain","page_number":149,"box":{"x":69,"y":513,"width":797,"height":11}},{"id":"788d4907-bc19-4623-a907-31c419a0f0da","block_type":"box","text":"shareholder services may not be available for the transferred shares. All future trading of these assets must be","page_number":149,"box":{"x":69,"y":528,"width":797,"height":11}},{"id":"3350a29a-ff13-4b50-9486-ca6de633716d","block_type":"box","text":"coordinated by the new firm. If you wish to transfer your shares to a securities dealer or other financial intermediary","page_number":149,"box":{"x":69,"y":543,"width":826,"height":11}},{"id":"82ff19e3-0de0-48a6-804e-a6bd44266f57","block_type":"box","text":"that has not entered into an agreement with the Distributor, you must either (i) redeem your shares, paying any","page_number":149,"box":{"x":68,"y":558,"width":792,"height":11}},{"id":"5478458d-3f1f-4711-a0f0-feb96b184079","block_type":"box","text":"applicable CDSC or (ii) continue to maintain an Investment Account at the Transfer Agent for those shares. You also","page_number":149,"box":{"x":69,"y":573,"width":824,"height":11}},{"id":"28e7243d-5a52-4b42-a4c3-6aad072e30bd","block_type":"box","text":"may request that the new securities dealer or other financial intermediary maintain the shares in an account at the","page_number":149,"box":{"x":69,"y":588,"width":820,"height":11}},{"id":"c1762ef9-f5d6-4d3f-bff2-90ee7168dd3a","block_type":"box","text":"Transfer Agent registered in the name of the securities dealer or other financial intermediary for your benefit whether","page_number":149,"box":{"x":68,"y":603,"width":833,"height":12}},{"id":"4ecfe0a7-1826-4ef0-9158-5e62b7d57fe9","block_type":"box","text":"the securities dealer or other financial intermediary has entered into a selected dealer agreement or not. In the","page_number":149,"box":{"x":68,"y":618,"width":795,"height":12}},{"id":"46acbcd9-4187-4ab2-b1e7-a089f9f63e42","block_type":"box","text":"interest of economy and convenience and because of the operating procedures of each Fund, share certificates will","page_number":149,"box":{"x":70,"y":634,"width":822,"height":11}},{"id":"69f1e1c7-1ea2-44db-b6fe-c013b63f4fbe","block_type":"box","text":"not be issued physically. Shares are maintained by each Fund on its register maintained by the Transfer Agent and","page_number":149,"box":{"x":69,"y":649,"width":814,"height":11}},{"id":"90b2e6c5-f4a4-4a38-9b67-64cdc60542f5","block_type":"box","text":"the holders thereof will have the same rights and ownership with respect to such shares as if certificates had been","page_number":149,"box":{"x":68,"y":664,"width":822,"height":11}},{"id":"b85050e3-ea72-4f58-8fc7-58dad85470dd","block_type":"box","text":"issued.","page_number":149,"box":{"x":70,"y":679,"width":49,"height":9}},{"id":"61ddfef1-add9-4dcb-bf73-8ea165bc71f7","block_type":"box","text":"If you are considering transferring a tax-deferred retirement account, such as an individual retirement account,","page_number":149,"box":{"x":102,"y":702,"width":785,"height":11}},{"id":"6aad234f-fa9a-462f-9ae4-a4f4578994b8","block_type":"box","text":"from one selected securities dealer to another securities dealer or other financial intermediary, you should be aware","page_number":149,"box":{"x":68,"y":717,"width":830,"height":11}},{"id":"8ec9a0dd-3641-4fc9-8fff-be55c4b9146d","block_type":"box","text":"that if the new firm will not take delivery of shares of the Fund, you must either redeem the shares (paying any","page_number":149,"box":{"x":68,"y":732,"width":790,"height":11}},{"id":"ac331b6c-fb86-4b6a-a364-a98afa295d35","block_type":"box","text":"applicable CDSC) so that the cash proceeds can be transferred to the account at the new firm, or you must continue","page_number":149,"box":{"x":69,"y":747,"width":831,"height":11}},{"id":"3955d240-5034-4842-a5ea-0a4f2a3a287e","block_type":"box","text":"to maintain a retirement account at the original selected securities dealer for those shares.","page_number":149,"box":{"x":68,"y":762,"width":652,"height":11}},{"id":"a2f15392-6254-4d5b-a90f-b537e779ca0e","block_type":"box","text":"Exchange Privilege","page_number":149,"box":{"x":69,"y":792,"width":138,"height":11}},{"id":"b2f23cc1-395e-48cb-b567-54e4be92562b","block_type":"box","text":"U.S. shareholders of Investor A, Investor A1, Investor C, Investor P, Class K, Institutional and Class G Shares of","page_number":149,"box":{"x":102,"y":815,"width":797,"height":11}},{"id":"5f68d475-9ad1-4f22-9294-1e3d6c1ebde8","block_type":"box","text":"each Fund have an exchange privilege with certain other Funds. However, Investor A1 Shares may only exchange out.","page_number":149,"box":{"x":69,"y":830,"width":832,"height":11}},{"id":"2aa10d9a-3bee-4cae-8611-e0485e963b15","block_type":"box","text":"The minimum amount for exchanges of Investor class shares is $1,000, although you may exchange less than","page_number":149,"box":{"x":68,"y":845,"width":788,"height":12}},{"id":"1c126837-3cd2-4720-b6ea-92c9eb92c1f9","block_type":"box","text":"$1,000 if you already have an account in the Fund into which you are exchanging. You may only exchange into a","page_number":149,"box":{"x":69,"y":860,"width":796,"height":12}},{"id":"0ebb6b4c-6b00-481e-8dd6-df731b87bb31","block_type":"box","text":"share class and a Fund that are open to new investors or in which you have a current account if the class or fund is","page_number":149,"box":{"x":69,"y":875,"width":824,"height":12}},{"id":"9e113c66-91a0-4d0f-922e-0c727e88c0aa","block_type":"box","text":"closed to new investors. Before effecting an exchange, you should obtain a currently effective prospectus of the fund","page_number":149,"box":{"x":69,"y":891,"width":835,"height":11}},{"id":"1eb4b2f0-056f-41ad-a608-7134b6ef1e7a","block_type":"box","text":"II-118","page_number":149,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"06af1990-3882-48c4-ad82-33107420cd14","block_type":"box","text":"NM0926U-5977317-149/232","page_number":149,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"e324ae1d-0262-4ef1-bd17-70d800ccf0eb","block_type":"box","text":"into which you wish to make the exchange. Exercise of the exchange privilege is treated as a sale of the exchanged","page_number":150,"box":{"x":70,"y":45,"width":820,"height":11}},{"id":"12ccf6e3-b85b-4614-8f82-1bf130312a09","block_type":"box","text":"shares and a purchase of the acquired shares for U.S. federal income tax purposes.","page_number":150,"box":{"x":69,"y":60,"width":600,"height":11}},{"id":"8ee84ee7-6c14-4bc9-9b2e-341f2c57f625","block_type":"box","text":"Exchanges of Investor A, Investor A1, Investor P, Class K, Institutional and Class G Shares.","page_number":150,"box":{"x":102,"y":82,"width":648,"height":12}},{"id":"b9b01ff9-4979-4b24-83d5-750ba55938a7","block_type":"box","text":"Institutional Shares","page_number":150,"box":{"x":757,"y":83,"width":137,"height":8}},{"id":"4e451e23-4642-49fe-9760-0a8e9a689557","block_type":"box","text":"are exchangeable with Institutional Shares of other Funds. Investor A and Investor A1 Shares are exchangeable for","page_number":150,"box":{"x":69,"y":98,"width":817,"height":11}},{"id":"55479ae2-bc75-448a-aebf-626c7e0f2f79","block_type":"box","text":"Investor A Shares of other Funds to the extent such shares are offered by your financial intermediary. Investor P","page_number":150,"box":{"x":70,"y":113,"width":798,"height":11}},{"id":"13f7917c-f8d2-4fa7-87a1-c142f4c71736","block_type":"box","text":"Shares are exchangeable for Investor P Shares of other Funds, to the extent such shares are offered by your financial","page_number":150,"box":{"x":69,"y":128,"width":838,"height":11}},{"id":"dfe890d2-d09e-4f15-82f7-f209d36386a7","block_type":"box","text":"intermediary. Class K Shares are exchangeable for Class K Shares of other Funds. Class G Shares are exchangeable","page_number":150,"box":{"x":70,"y":143,"width":834,"height":11}},{"id":"b661734e-a57f-41a5-9cf3-b867d3d7389b","block_type":"box","text":"for Class G Shares of other Funds.","page_number":150,"box":{"x":68,"y":158,"width":246,"height":9}},{"id":"821219c9-349f-456d-a061-d5f0f1ff4cd2","block_type":"box","text":"Exchanges of Institutional Shares outstanding for Institutional Shares of a second fund or for shares of a money","page_number":150,"box":{"x":102,"y":181,"width":800,"height":11}},{"id":"0d9f042f-d5b3-4b30-a7ae-107b8d1a5054","block_type":"box","text":"market fund are effected on the basis of relative NAV per Institutional Share. Exchanges of Investor A or Investor A1","page_number":150,"box":{"x":69,"y":196,"width":826,"height":11}},{"id":"74600340-6c83-42e0-8bf6-6a9be859c7d3","block_type":"box","text":"Shares outstanding (“outstanding Investor A Shares”) for Investor A Shares of a second fund, or for shares of a","page_number":150,"box":{"x":69,"y":211,"width":795,"height":11}},{"id":"b110e789-8bc2-4d5e-9a6a-7d401f0af228","block_type":"box","text":"money market fund (“new Investor A Shares”) are effected on the basis of relative NAV per share. Exchanges of","page_number":150,"box":{"x":69,"y":226,"width":797,"height":11}},{"id":"89b60c24-b207-4352-bdb9-bd30b5e4f6de","block_type":"box","text":"Investor P Shares outstanding for Investor P Shares of a second fund are effected on the basis of relative NAV per","page_number":150,"box":{"x":70,"y":241,"width":814,"height":11}},{"id":"670881f4-1e3a-461e-9d72-011019e2f2e1","block_type":"box","text":"share. Exchanges of Class K Shares outstanding for Class K Shares of a second fund, or for shares of a money","page_number":150,"box":{"x":69,"y":256,"width":796,"height":12}},{"id":"f2b14c98-57a0-4301-9067-4972a7acf809","block_type":"box","text":"market fund are effected on the basis of relative NAV per share. Exchanges of Class G Shares outstanding for Class","page_number":150,"box":{"x":69,"y":271,"width":828,"height":12}},{"id":"e217c0ce-a6f4-442e-b0a7-be6eab41cece","block_type":"box","text":"G Shares of a second fund are effected on the basis of relative NAV per share.","page_number":150,"box":{"x":69,"y":286,"width":561,"height":11}},{"id":"cca35de2-911b-4355-9b1b-120407b3336b","block_type":"box","text":"Exchanges of Investor C Shares.","page_number":150,"box":{"x":102,"y":309,"width":229,"height":11}},{"id":"14f1a990-79c8-4441-bc9a-15fbbdbee9fd","block_type":"box","text":"Shareholders of certain Funds with Investor C Shares outstanding (“outstanding","page_number":150,"box":{"x":338,"y":309,"width":570,"height":11}},{"id":"70d903ec-b391-4c94-9439-a50904071c01","block_type":"box","text":"Investor C Shares”) may exchange their shares for Investor C Shares of a second Fund (“new Investor C Shares”) or","page_number":150,"box":{"x":70,"y":324,"width":827,"height":12}},{"id":"e6fab4a4-6a94-40cd-9bef-0785e213b474","block_type":"box","text":"for shares of a money market fund (“new money market fund Shares”) on the basis of relative NAV per share, without","page_number":150,"box":{"x":68,"y":339,"width":839,"height":12}},{"id":"95d32048-9444-477d-a139-1cff8fff0ccf","block_type":"box","text":"the payment of any CDSC. Certain Funds impose different CDSC schedules. For purposes of computing the CDSC","page_number":150,"box":{"x":68,"y":355,"width":811,"height":11}},{"id":"7ae8964f-2e4b-40ac-b09e-2a4269f75b38","block_type":"box","text":"upon redemption of new Investor C Shares or new money market fund Shares, as applicable, the time you held both","page_number":150,"box":{"x":69,"y":370,"width":827,"height":11}},{"id":"bb955866-463c-4150-8ed1-40c4bf53907a","block_type":"box","text":"the exchanged Investor C Shares and the new Investor C Shares or new money market fund Shares will count","page_number":150,"box":{"x":68,"y":385,"width":781,"height":11}},{"id":"a79a4382-c31d-4f3b-a0f7-4f86d5968503","block_type":"box","text":"towards the holding period of the new Investor C Shares or new money market fund Shares.","page_number":150,"box":{"x":68,"y":400,"width":654,"height":11}},{"id":"c9f29c1f-f402-4523-acc6-df9303dd94ee","block_type":"box","text":"Exchanges of Service Shares.","page_number":150,"box":{"x":102,"y":423,"width":211,"height":11}},{"id":"af79609b-14ab-47cd-a505-fff91d80781e","block_type":"box","text":"Service Shares can be exchanged for Service Shares of Funds that are covered by","page_number":150,"box":{"x":319,"y":423,"width":588,"height":11}},{"id":"5a545445-cbc9-4e97-b60a-8097fc1f422f","block_type":"box","text":"selected dealer agreements with the Distributor.","page_number":150,"box":{"x":69,"y":438,"width":342,"height":11}},{"id":"316cb49f-aed9-46eb-8186-73d503d98e57","block_type":"box","text":"Exchanges for Shares of a Money Market Fund.","page_number":150,"box":{"x":102,"y":460,"width":335,"height":12}},{"id":"bde4f32d-3483-4b25-9a46-959de5f5916b","block_type":"box","text":"You may exchange any class of Investor class shares, excluding","page_number":150,"box":{"x":443,"y":460,"width":455,"height":12}},{"id":"60efb46c-e7f6-486c-a3aa-980897a2d23d","block_type":"box","text":"Investor P Shares, for shares of an affiliated money market fund. If you exchange into BlackRock Summit Cash","page_number":150,"box":{"x":70,"y":475,"width":788,"height":12}},{"id":"4f598486-99d1-492f-9f64-602724febd9c","block_type":"box","text":"Reserves Fund (“Summit”), a series of BlackRock Financial Institutions Series Trust, you will receive one of two","page_number":150,"box":{"x":70,"y":491,"width":793,"height":11}},{"id":"85058c39-a7bb-415b-94b3-edc6e00ee83f","block_type":"box","text":"classes of shares: exchanges of Investor A, Investor A1 and Institutional Shares of a Fund will receive Investor A","page_number":150,"box":{"x":69,"y":506,"width":802,"height":11}},{"id":"0bef4f7b-e2de-49cb-aae3-a7289db5cbd1","block_type":"box","text":"Shares of Summit and exchanges of Investor C Shares of a Fund will receive Investor C Shares of Summit. You may","page_number":150,"box":{"x":69,"y":521,"width":824,"height":11}},{"id":"a4eee03a-91e8-4468-a335-dd276ef6d708","block_type":"box","text":"exchange Investor A Shares of Summit back into Investor A or Institutional Shares of a Fund, if you are eligible to","page_number":150,"box":{"x":69,"y":536,"width":805,"height":11}},{"id":"60667643-8fe6-48a8-91ff-c1284c3d42fc","block_type":"box","text":"hold such shares. You may exchange Investor C Shares of Summit back into Investor C Shares of a Fund and, in the","page_number":150,"box":{"x":69,"y":551,"width":827,"height":11}},{"id":"6f94ff1f-d6e7-4c98-9691-2b5a5e70352d","block_type":"box","text":"event of such an exchange, the period of time that you held Investor C Shares of Summit will count toward","page_number":150,"box":{"x":69,"y":566,"width":758,"height":11}},{"id":"e6165696-0d8e-4ab3-99f8-4344321de0cc","block_type":"box","text":"satisfaction of the holding period requirement for purposes of reducing any CDSC. Investor C Shares of Summit are","page_number":150,"box":{"x":69,"y":581,"width":822,"height":12}},{"id":"e382fc5e-7c43-4781-bc0a-9eaec8beaf5a","block_type":"box","text":"subject to a distribution fee at an annual rate of 0.75% of average daily net assets of such Investor C Shares.","page_number":150,"box":{"x":69,"y":596,"width":782,"height":12}},{"id":"ad90be8a-8230-4db7-91a2-8f50a20ee6cb","block_type":"box","text":"Exchanges of Investor C Shares of a money market fund other than Summit for Investor C Shares of a Fund will be","page_number":150,"box":{"x":70,"y":612,"width":814,"height":11}},{"id":"5e93453d-7d0c-43da-aa65-b0eebabcf1de","block_type":"box","text":"exercised at NAV. However, a CDSC may be charged in connection with any subsequent redemption of the Investor C","page_number":150,"box":{"x":69,"y":627,"width":830,"height":11}},{"id":"21db45ab-d4d0-4103-be59-3dec57431360","block_type":"box","text":"Shares of the Fund received in the exchange. In determining the holding period for calculating the CDSC payable on","page_number":150,"box":{"x":69,"y":642,"width":821,"height":11}},{"id":"cfb96538-bcbe-4470-8103-2e2211d2b59c","block_type":"box","text":"redemption of Investor C Shares of the Fund received in the exchange, the holding period of the money market fund","page_number":150,"box":{"x":69,"y":657,"width":823,"height":11}},{"id":"d0c9e189-049f-40d9-a5db-ddb55e465fd1","block_type":"box","text":"Investor C Shares originally held will be added to the holding period of the Investor C Shares acquired through","page_number":150,"box":{"x":70,"y":672,"width":781,"height":11}},{"id":"b9f5df8c-ef5f-4d91-9ea7-0b22acf6ca28","block_type":"box","text":"exchange.","page_number":150,"box":{"x":69,"y":687,"width":70,"height":11}},{"id":"9e39a78d-1ca3-4e77-b4fe-893dec0539e5","block_type":"box","text":"Exchanges by Par ticipants in Cer tain Programs.","page_number":150,"box":{"x":102,"y":710,"width":337,"height":11}},{"id":"e9a9d228-8e2c-438a-b719-64d8f120b736","block_type":"box","text":"The exchange privilege may be modified with respect to certain","page_number":150,"box":{"x":445,"y":710,"width":448,"height":11}},{"id":"0c46b97e-d7cf-4698-8a6a-27320a2199e9","block_type":"box","text":"participants in mutual fund advisory programs and other fee-based programs sponsored by the Manager, an affiliate","page_number":150,"box":{"x":70,"y":725,"width":828,"height":11}},{"id":"7bca9033-f192-4b13-9d57-c71d8bfbcf84","block_type":"box","text":"of the Manager, or selected securities dealers or other financial intermediaries that have an agreement with the","page_number":150,"box":{"x":69,"y":740,"width":796,"height":11}},{"id":"d0899da6-871e-4d16-8254-4c1636a66725","block_type":"box","text":"Distributor. See “Fee-Based Programs” below.","page_number":150,"box":{"x":70,"y":755,"width":324,"height":11}},{"id":"103b1deb-4446-4dfc-82ee-f2c89397d453","block_type":"box","text":"Exercise of the Exchange Privilege.","page_number":150,"box":{"x":102,"y":778,"width":245,"height":11}},{"id":"d40c6c4f-26ee-4f63-af52-470e2d8b42ef","block_type":"box","text":"To exercise the exchange privilege, you should contact your financial adviser","page_number":150,"box":{"x":353,"y":778,"width":543,"height":11}},{"id":"6a82b8aa-55ad-4805-a174-fa19b08bb514","block_type":"box","text":"or the Transfer Agent, who will advise each Fund of the exchange. If you do not hold share certificates, you may","page_number":150,"box":{"x":69,"y":793,"width":794,"height":11}},{"id":"666962da-72bc-4c6e-ace9-e107ce509526","block_type":"box","text":"exercise the exchange privilege by wire through your securities dealer or other financial intermediary. Each Fund","page_number":150,"box":{"x":69,"y":808,"width":795,"height":11}},{"id":"e7f50904-4067-483e-9d4b-d3c32106c5f0","block_type":"box","text":"reserves the right to require a properly completed exchange application.","page_number":150,"box":{"x":69,"y":823,"width":512,"height":12}},{"id":"051eb82c-8725-460a-8b0b-6222d875f120","block_type":"box","text":"A shareholder who wishes to make an exchange may do so by sending a written request to the Fund c/o the","page_number":150,"box":{"x":101,"y":846,"width":772,"height":11}},{"id":"74397c91-4e7d-4885-94c9-e522daedc7b1","block_type":"box","text":"Transfer Agent at the following address: P.O. Box 534429, Pittsburgh, Pennsylvania 15253-4429. Shareholders are","page_number":150,"box":{"x":68,"y":861,"width":824,"height":11}},{"id":"a0390cf2-d6bc-433c-9a4f-c821c6a817d1","block_type":"box","text":"automatically provided with telephone exchange privileges when opening an account, unless they indicate on the","page_number":150,"box":{"x":69,"y":876,"width":801,"height":11}},{"id":"bcfb547d-ed9d-4cc9-a622-cfb2696da4ff","block_type":"box","text":"Application that they do not wish to use this privilege. To add this feature to an existing account that previously did","page_number":150,"box":{"x":68,"y":891,"width":817,"height":12}},{"id":"07f74ed4-17ec-4dcc-bd3a-091c4d2587cf","block_type":"box","text":"not provide this option, a Telephone Exchange Authorization Form must be filed with the Transfer Agent. This form is","page_number":150,"box":{"x":69,"y":906,"width":826,"height":12}},{"id":"a19e0a98-0fc5-48ad-91aa-6e584667d4a0","block_type":"box","text":"II-119","page_number":150,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"6488a05b-1c21-4dc5-9fd7-3b1acbed5c3d","block_type":"box","text":"NM0926U-5977317-150/232","page_number":150,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"156b7a65-7fde-463a-a676-2819b9480f87","block_type":"box","text":"available from the Transfer Agent. Once this election has been made, the shareholder may simply contact the Fund by","page_number":151,"box":{"x":69,"y":45,"width":840,"height":11}},{"id":"91c73089-6098-4b93-9053-fe75fb6b10e2","block_type":"box","text":"telephone at (800) 441-7762 to request the exchange. During periods of substantial economic or market change,","page_number":151,"box":{"x":68,"y":60,"width":811,"height":11}},{"id":"90c6902b-8dd7-4747-b80d-e5d6704c752e","block_type":"box","text":"telephone exchanges may be difficult to complete and shareholders may have to submit exchange requests to the","page_number":151,"box":{"x":68,"y":75,"width":815,"height":11}},{"id":"98a116f0-037c-4dfa-8423-9e0215e91c08","block_type":"box","text":"Transfer Agent in writing.","page_number":151,"box":{"x":68,"y":90,"width":175,"height":11}},{"id":"07db6179-b669-4a31-88fc-69598b9b6038","block_type":"box","text":"If the exchanging shareholder does not currently own shares of the investment portfolio whose shares are being","page_number":151,"box":{"x":102,"y":113,"width":800,"height":11}},{"id":"4d92c93c-b83f-49e1-ac30-c64af9cee534","block_type":"box","text":"acquired, a new account will be established with the same registration, dividend and capital gain options and broker","page_number":151,"box":{"x":69,"y":128,"width":828,"height":11}},{"id":"b9f6e174-e78b-4c11-ae57-2c27bcd212ad","block_type":"box","text":"of record as the account from which shares are exchanged, unless otherwise specified in writing by the shareholder","page_number":151,"box":{"x":69,"y":143,"width":826,"height":11}},{"id":"7c2e768f-40d2-4bdb-9210-639ffa8c92bf","block_type":"box","text":"with all signatures guaranteed by an eligible guarantor institution as defined below. In order to participate in the","page_number":151,"box":{"x":68,"y":158,"width":797,"height":11}},{"id":"d7b1e75f-14f8-466f-b2f7-027422ff05fd","block_type":"box","text":"Automatic Investment Program or establish a Systematic Withdrawal Plan for the new account, however, an","page_number":151,"box":{"x":68,"y":173,"width":763,"height":11}},{"id":"8b06809b-f7fc-467e-aee2-d7b6e1851aa8","block_type":"box","text":"exchanging shareholder must file a specific written request.","page_number":151,"box":{"x":69,"y":188,"width":424,"height":12}},{"id":"aa286a04-55c1-4ecc-b20a-b57443147533","block_type":"box","text":"Any share exchange must satisfy the requirements relating to the minimum initial investment requirement, and","page_number":151,"box":{"x":101,"y":211,"width":790,"height":11}},{"id":"f1a328c5-9523-4174-92b0-4370afd9399e","block_type":"box","text":"must be legally available for sale in the state of the investor’s residence. For U.S. federal income tax purposes, a","page_number":151,"box":{"x":69,"y":226,"width":808,"height":11}},{"id":"1b17e647-215c-431c-8d3a-19fc41f1a6e1","block_type":"box","text":"share exchange is a taxable event and, accordingly, a capital gain or loss may be realized. Before making an","page_number":151,"box":{"x":69,"y":241,"width":771,"height":11}},{"id":"3d5a5d78-1c04-40ac-9173-cb55c6c968ff","block_type":"box","text":"exchange request, shareholders should consult a tax or other financial adviser and should consider the investment","page_number":151,"box":{"x":69,"y":256,"width":819,"height":12}},{"id":"cd9e1882-ddf0-45d3-a8f8-fdb954f0ae0b","block_type":"box","text":"objective, policies and restrictions of the investment portfolio into which the shareholder is making an exchange.","page_number":151,"box":{"x":69,"y":271,"width":802,"height":12}},{"id":"f3c0d41d-8eeb-4cd1-9eb5-d8b6b0a8174a","block_type":"box","text":"Brokers may charge a fee for handling exchanges.","page_number":151,"box":{"x":70,"y":286,"width":354,"height":12}},{"id":"ce5f2126-3995-4e04-88ad-68722d76b8e8","block_type":"box","text":"The Funds reserve the right to suspend, modify or terminate the exchange privilege at any time. Notice will be","page_number":151,"box":{"x":101,"y":309,"width":782,"height":11}},{"id":"6e009e0b-34e1-42ae-a26f-275dbf07dcd7","block_type":"box","text":"given to shareholders of any material modification or termination except where notice is not required. The Funds","page_number":151,"box":{"x":68,"y":324,"width":800,"height":12}},{"id":"62d015f1-77d9-4179-9869-cd6c10afbea9","block_type":"box","text":"reserve the right to reject any telephone exchange request. Telephone exchanges may be subject to limitations as to","page_number":151,"box":{"x":69,"y":340,"width":831,"height":11}},{"id":"f368f019-87bd-4d1a-b517-b1493b25cb21","block_type":"box","text":"amount or frequency, and to other restrictions that may be established from time to time to ensure that exchanges","page_number":151,"box":{"x":69,"y":355,"width":818,"height":11}},{"id":"d0b154a1-f005-43ad-8794-e5fe6b4596c7","block_type":"box","text":"do not operate to the disadvantage of any portfolio or its shareholders.","page_number":151,"box":{"x":69,"y":370,"width":506,"height":11}},{"id":"5c09b1be-f5ef-401f-97f1-7b0f851296b3","block_type":"box","text":"The Funds, the Administrators and BRIL will employ reasonable procedures to confirm that instructions","page_number":151,"box":{"x":101,"y":392,"width":733,"height":12}},{"id":"5ba533e3-77b4-422d-aa24-fa29435ad5db","block_type":"box","text":"communicated by telephone are genuine. The Funds, the Administrators and BRIL will not be liable for any loss,","page_number":151,"box":{"x":69,"y":407,"width":793,"height":12}},{"id":"44e25566-192a-4333-8d6e-e32bf5d206d9","block_type":"box","text":"liability, cost or expense for acting upon telephone instructions reasonably believed to be genuine in accordance with","page_number":151,"box":{"x":70,"y":423,"width":832,"height":11}},{"id":"774ea369-ab88-4dfe-a55f-797354dd389e","block_type":"box","text":"such procedures. By use of the exchange privilege, the investor authorizes the Fund’s Transfer Agent to act on","page_number":151,"box":{"x":69,"y":438,"width":785,"height":11}},{"id":"ef9ce803-694c-4149-b1ba-e648a4fa927f","block_type":"box","text":"telephonic or written exchange instructions from any person representing himself to be the investor and believed by","page_number":151,"box":{"x":68,"y":453,"width":825,"height":11}},{"id":"7c4c7d64-9da9-4895-8eb4-4d5992c2f13a","block_type":"box","text":"the Fund’s Transfer Agent to be genuine. The records of the Fund’s Transfer Agent pertaining to such instructions are","page_number":151,"box":{"x":68,"y":468,"width":837,"height":11}},{"id":"2e1b249e-26c3-4499-8191-fffc948fb28b","block_type":"box","text":"binding. The exchange privilege may be modified or terminated at any time upon 60 days’ notice to affected","page_number":151,"box":{"x":69,"y":483,"width":767,"height":11}},{"id":"53ef46a0-f4ae-4374-893b-4fc70ee1b6c5","block_type":"box","text":"shareholders. The exchange privilege is only available in states where the exchange may legally be made.","page_number":151,"box":{"x":69,"y":498,"width":750,"height":11}},{"id":"b0af1b63-d7fc-4f8f-b6e9-8056d4f5c4b8","block_type":"box","text":"Each Fund reserves the right to limit the number of times an investor may exercise the exchange privilege.","page_number":151,"box":{"x":102,"y":521,"width":757,"height":11}},{"id":"a5c637e8-ed88-45e2-bcd9-f7a757cdefa9","block_type":"box","text":"Certain Funds may suspend the continuous offering of their shares to the general public at any time and may resume","page_number":151,"box":{"x":69,"y":536,"width":837,"height":11}},{"id":"b98db997-2ead-4ee5-848d-e68bf761d8c5","block_type":"box","text":"such offering from time to time. The exchange privilege is available only to U.S. shareholders in states where the","page_number":151,"box":{"x":69,"y":551,"width":805,"height":11}},{"id":"78563fca-41c3-4d66-908f-bc49b52b2dba","block_type":"box","text":"exchange legally may be made. The exchange privilege may be applicable to other new mutual funds whose shares","page_number":151,"box":{"x":69,"y":566,"width":817,"height":11}},{"id":"91cabea3-7afd-47e6-a044-76d893823a45","block_type":"box","text":"may be distributed by the Distributor.","page_number":151,"box":{"x":69,"y":582,"width":262,"height":10}},{"id":"486dc3ea-bc68-4acb-8c1c-44886a713e6e","block_type":"box","text":"Participation in Fee-Based Programs","page_number":151,"box":{"x":69,"y":612,"width":266,"height":11}},{"id":"267e097d-8687-4d22-a46f-7dbe3df982ec","block_type":"box","text":"If you participate in certain fee-based programs offered by BlackRock or an affiliate of BlackRock, or selected","page_number":151,"box":{"x":102,"y":634,"width":780,"height":12}},{"id":"cf8be872-136a-497c-8115-000a79060035","block_type":"box","text":"securities dealers or other financial intermediaries that have agreements with the Distributor or in certain fee-based","page_number":151,"box":{"x":69,"y":649,"width":826,"height":12}},{"id":"d1c57704-59a3-4921-94d5-bd29c8309a5c","block_type":"box","text":"programs in which BlackRock participates, you may be able to buy Institutional Shares, including by exchanges from","page_number":151,"box":{"x":70,"y":664,"width":825,"height":12}},{"id":"cee00eb6-dc62-4f03-8bbb-0fe7c60c8386","block_type":"box","text":"other share classes. Sales charges on the shares being exchanged may be reduced or waived under certain","page_number":151,"box":{"x":69,"y":680,"width":770,"height":11}},{"id":"314aa22a-a237-4232-ba2d-db0247acccb3","block_type":"box","text":"circumstances. You generally cannot transfer shares held through a fee-based program into another account. Instead,","page_number":151,"box":{"x":69,"y":695,"width":837,"height":11}},{"id":"3b39fb39-886f-47f2-a82d-94eaa50ef56d","block_type":"box","text":"if you choose to leave the fee-based program, you may have to redeem your shares held through the program and","page_number":151,"box":{"x":70,"y":710,"width":808,"height":11}},{"id":"c7acdcb8-d897-4f97-ac0c-d514c64cbe64","block_type":"box","text":"purchase shares of another class, which may be subject to distribution and service fees. This may be a taxable event","page_number":151,"box":{"x":70,"y":725,"width":838,"height":11}},{"id":"4113c9a1-eef0-41bd-a00b-507ace6f2c8e","block_type":"box","text":"and you may pay any applicable sales charges or redemption fee. Please speak to your financial intermediary for","page_number":151,"box":{"x":69,"y":740,"width":804,"height":11}},{"id":"508abb04-b575-42df-aa64-2e57150a2d7f","block_type":"box","text":"information about specific policies and procedures applicable to your account.","page_number":151,"box":{"x":70,"y":755,"width":555,"height":11}},{"id":"057ab8d7-e0b3-4a72-9a2b-4fe002540cc7","block_type":"box","text":"Generally, upon termination of a fee-based program, the shares may be liquidated or the shares can be held in","page_number":151,"box":{"x":102,"y":778,"width":788,"height":11}},{"id":"456512b3-f56c-4297-8e20-6c19fd715c6d","block_type":"box","text":"an account. In certain circumstances, when a shareholder chooses to continue to hold the shares, whatever share","page_number":151,"box":{"x":69,"y":793,"width":817,"height":10}},{"id":"b79dc802-9d83-476d-81fd-afb290ee9d3f","block_type":"box","text":"class was held in the program can be held after termination. Shares that have been held for less than specified","page_number":151,"box":{"x":69,"y":808,"width":796,"height":11}},{"id":"8ef1c14b-26f9-4791-8148-b705c0c14291","block_type":"box","text":"periods within the program may be subject to a fee upon redemption. Shareholders that held Investor A or","page_number":151,"box":{"x":70,"y":823,"width":754,"height":12}},{"id":"49052a66-876a-4ee8-85d0-8b782fe9f0c5","block_type":"box","text":"Institutional Shares in the program may be eligible to purchase additional shares of the respective share class of a","page_number":151,"box":{"x":70,"y":838,"width":820,"height":12}},{"id":"73f05a5c-32a5-4318-83fe-4afc0b64a1c6","block_type":"box","text":"Fund, but may be subject to upfront sales charges with respect to Investor A Shares. Additional purchases of","page_number":151,"box":{"x":70,"y":853,"width":777,"height":12}},{"id":"61d9cec2-1019-4d14-aeb2-40b0c0c81efb","block_type":"box","text":"Institutional Shares are permitted only if you have an existing position at the time of purchase or are otherwise","page_number":151,"box":{"x":70,"y":869,"width":791,"height":11}},{"id":"31adc5cd-88c3-450d-a088-38d255bc90eb","block_type":"box","text":"eligible to purchase Institutional Shares. Please speak to your financial intermediary for more information.","page_number":151,"box":{"x":69,"y":884,"width":756,"height":11}},{"id":"db52e8ee-c90f-4347-9262-8b1414282650","block_type":"box","text":"II-120","page_number":151,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"65999e43-0cee-450b-a8ba-b0a9378584c9","block_type":"box","text":"NM0926U-5977317-151/232","page_number":151,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"87cd571c-bd50-43b5-a093-f7a37fc8c190","block_type":"box","text":"Certain financial intermediaries may, in connection with a change in account type (for example, due to leaving a","page_number":152,"box":{"x":102,"y":45,"width":793,"height":11}},{"id":"048a729f-711e-4b62-a57c-3f635dde3011","block_type":"box","text":"fee-based program or upon termination of the fee-based program) or otherwise in accordance with the financial","page_number":152,"box":{"x":68,"y":60,"width":791,"height":11}},{"id":"f4355ebe-977f-4aa3-b9cc-ac3d939a448c","block_type":"box","text":"intermediary’s policies and procedures, exchange the share class held in the program for another share class of the","page_number":152,"box":{"x":70,"y":75,"width":830,"height":11}},{"id":"b9672caa-4828-4790-8291-cb06524e661f","block_type":"box","text":"same fund, provided that the exchanged shares are not subject to a sales charge and the shareholder meets the","page_number":152,"box":{"x":69,"y":90,"width":807,"height":11}},{"id":"3b77867f-f56b-4c0c-8d90-8fcd60acf6ba","block_type":"box","text":"eligibility requirements of the new share class. Please speak to your financial intermediary for information about","page_number":152,"box":{"x":69,"y":105,"width":801,"height":11}},{"id":"1a2c94de-2c0e-4106-a2b1-964b01061766","block_type":"box","text":"specific policies and procedures applicable to your account.","page_number":152,"box":{"x":69,"y":120,"width":424,"height":11}},{"id":"52b67a96-5357-4668-9e71-a085bfb633fe","block_type":"box","text":"Details about the features of each fee-based program and the relevant charges, terms and conditions are","page_number":152,"box":{"x":102,"y":143,"width":752,"height":11}},{"id":"f272dcab-dd45-4916-b4f3-db3d44d5ff44","block_type":"box","text":"included in the client agreement for each fee-based program and are available from your financial professional,","page_number":152,"box":{"x":70,"y":158,"width":789,"height":11}},{"id":"3c64d94d-6e8a-42a4-99c9-37514d6a2460","block_type":"box","text":"selected securities dealer or other financial intermediary. Please speak to your financial intermediary for more","page_number":152,"box":{"x":69,"y":173,"width":785,"height":11}},{"id":"92340ea0-b46d-4a29-b469-1164a9d8e610","block_type":"box","text":"information.","page_number":152,"box":{"x":70,"y":188,"width":83,"height":9}},{"id":"9f06d7dc-25e0-4dbc-b87b-ae0d56679a20","block_type":"box","text":"Retirement and Education Savings Plans","page_number":152,"box":{"x":69,"y":219,"width":296,"height":11}},{"id":"b842dc98-3559-4556-83ac-e8f3c074ebdf","block_type":"box","text":"Individual retirement accounts and other retirement and education savings plans are available from your financial","page_number":152,"box":{"x":102,"y":241,"width":805,"height":11}},{"id":"2da2d237-0ba7-4a5a-84ca-d5bdb2ee69e3","block_type":"box","text":"intermediary. Under these plans, investments may be made in a Fund (other than a Municipal Fund) and certain of","page_number":152,"box":{"x":70,"y":256,"width":815,"height":11}},{"id":"db130a92-de39-4c59-b8e7-405a3b8c0a0d","block_type":"box","text":"the other mutual funds sponsored by the Manager or its affiliates as well as in other securities. There may be fees","page_number":152,"box":{"x":68,"y":271,"width":819,"height":12}},{"id":"623e4da8-55f3-468d-8e83-20445b1368bb","block_type":"box","text":"associated with investing through these plans. Information with respect to these plans is available on request from","page_number":152,"box":{"x":69,"y":286,"width":820,"height":12}},{"id":"6d23ff9d-d5b4-40bd-b4d9-c4811ee2a5f8","block_type":"box","text":"your financial intermediary.","page_number":152,"box":{"x":68,"y":302,"width":191,"height":11}},{"id":"0d6f0198-8d0d-4246-90c0-44ce0fb5430e","block_type":"box","text":"Dividends received in each of the plans referred to above are exempt from U.S. federal taxation until distributed","page_number":152,"box":{"x":102,"y":324,"width":796,"height":11}},{"id":"d76bc7eb-944c-4678-be19-0f428e7187ad","block_type":"box","text":"from the plans and, in the case of Roth IRAs and education savings plans, may be exempt from taxation when","page_number":152,"box":{"x":68,"y":339,"width":784,"height":12}},{"id":"5025b221-14b3-4e1e-9a09-55c7013cc397","block_type":"box","text":"distributed as well. Investors considering participation in any retirement or education savings plan should review","page_number":152,"box":{"x":69,"y":355,"width":801,"height":11}},{"id":"f2152718-772c-47ab-a57c-6481049080f4","block_type":"box","text":"specific tax laws relating to the plan and should consult their attorneys or tax advisors with respect to the","page_number":152,"box":{"x":69,"y":370,"width":753,"height":11}},{"id":"fa826947-2ddb-48d2-864b-04307f073f18","block_type":"box","text":"establishment and maintenance of any such plan.","page_number":152,"box":{"x":69,"y":385,"width":354,"height":11}},{"id":"10bb8ba8-8206-405e-94d3-567bb4f0b0ce","block_type":"box","text":"Automatic Investment Plans","page_number":152,"box":{"x":68,"y":415,"width":207,"height":9}},{"id":"2ffe9488-1fb3-4105-8df6-a5fbd62674f4","block_type":"box","text":"Investor class shareholders and certain Service Share shareholders who were shareholders of the Compass","page_number":152,"box":{"x":102,"y":438,"width":773,"height":11}},{"id":"add9b5ff-25eb-4aaf-80bb-bb2cb02ea572","block_type":"box","text":"Capital Group of Funds at the time of its combination with The PNC","page_number":152,"box":{"x":69,"y":453,"width":477,"height":11}},{"id":"7089d73b-3120-499c-8476-00d818169f89","block_type":"box","text":"®","page_number":152,"box":{"x":547,"y":453,"width":6,"height":5}},{"id":"eab17f17-a9c0-4a15-90aa-d777f2408586","block_type":"box","text":"Fund in 1996 may arrange for periodic","page_number":152,"box":{"x":559,"y":453,"width":272,"height":11}},{"id":"fad05542-7c87-4cf3-a9d7-df06a251f3b6","block_type":"box","text":"investments in that Fund through automatic deductions from a checking or savings account. The minimum pre","page_number":152,"box":{"x":70,"y":468,"width":787,"height":11}},{"id":"8147a5af-2e6f-4a02-b03e-e8d68d874cbf","block_type":"box","text":"authorized investment amount is $50. If you buy shares of a Fund through certain accounts, no minimum charge to","page_number":152,"box":{"x":69,"y":482,"width":822,"height":12}},{"id":"5118eb74-fc32-4784-9f48-88c4a72110c4","block_type":"box","text":"your bank account is required. Contact your financial adviser or other financial intermediary for more information.","page_number":152,"box":{"x":68,"y":498,"width":805,"height":11}},{"id":"4e45eb2a-d149-48c3-8e95-de0ebd7f4305","block_type":"box","text":"Automatic Dividend Reinvestment Plan","page_number":152,"box":{"x":68,"y":529,"width":285,"height":8}},{"id":"9d58e550-a11d-4efe-92ae-078795c15409","block_type":"box","text":"Each Fund will distribute substantially all of its net investment income and net realized capital gains, if any, to","page_number":152,"box":{"x":102,"y":551,"width":782,"height":11}},{"id":"12bb1ef5-4053-464c-8e8e-24d6dad829f6","block_type":"box","text":"shareholders. All distributions are automatically reinvested at NAV in the form of additional full and fractional shares","page_number":152,"box":{"x":69,"y":566,"width":828,"height":11}},{"id":"b554c0bd-17bb-4c03-9dc8-6b15d1ca3859","block_type":"box","text":"of the same class of shares of the relevant Fund unless a shareholder elects otherwise or as otherwise set forth in a","page_number":152,"box":{"x":69,"y":581,"width":839,"height":9}},{"id":"5cba00fb-49a5-489f-88e2-1d591c32dbb5","block_type":"box","text":"Fund’s prospectus. Such election, or any revocation thereof, must be made in writing to the Transfer Agent, and will","page_number":152,"box":{"x":70,"y":596,"width":822,"height":12}},{"id":"9597a222-d498-4515-b0a6-cbebb46f6bda","block_type":"box","text":"become effective with respect to dividends paid after its receipt by the Transfer Agent.","page_number":152,"box":{"x":69,"y":612,"width":614,"height":11}},{"id":"e49b74c6-5484-4dfd-aab4-b08ef10121b3","block_type":"box","text":"Systematic Withdrawal Plans","page_number":152,"box":{"x":68,"y":642,"width":214,"height":11}},{"id":"7e700d48-a5fc-439d-b7a2-0d06c0e2b37a","block_type":"box","text":"Shareholders may receive regular distributions from their accounts via a Systematic Withdrawal Plan (“SWP”).","page_number":152,"box":{"x":102,"y":664,"width":780,"height":12}},{"id":"86ff00b1-b493-4240-ae70-a838a9988fb9","block_type":"box","text":"Upon commencement of the SWP, the account must have a current value of $10,000 or more in a Fund.","page_number":152,"box":{"x":70,"y":679,"width":742,"height":12}},{"id":"4dfaae45-a1f8-4bec-a9e5-e8b78c8f7e91","block_type":"box","text":"Shareholders may elect to receive automatic cash payments of $50 or more at any interval. You may choose any day","page_number":152,"box":{"x":69,"y":694,"width":834,"height":12}},{"id":"b58888af-e09e-4448-90a6-8d4b8a5e61b4","block_type":"box","text":"for the withdrawal. If no day is specified, the withdrawals will be processed on the 25th day of the month or, if such","page_number":152,"box":{"x":68,"y":710,"width":823,"height":11}},{"id":"1359d4e1-a81a-4ebe-9acd-23e0a79c7273","block_type":"box","text":"day is not a business day, on the prior business day and are paid promptly thereafter. An investor may utilize the SWP","page_number":152,"box":{"x":69,"y":725,"width":840,"height":11}},{"id":"09b6cd3b-6510-459a-8554-c27ca92e578e","block_type":"box","text":"by completing the Systematic Withdrawal Plan Application Form which may be obtained by visiting our website at","page_number":152,"box":{"x":69,"y":740,"width":800,"height":11}},{"id":"84de02d8-5e40-4853-8887-93ec104c13ee","block_type":"box","text":"www.blackrock.com.","page_number":152,"box":{"x":68,"y":755,"width":142,"height":9}},{"id":"e77c6fef-ab28-49c2-bcfd-a93538d6a392","block_type":"box","text":"Shareholders should realize that if withdrawals exceed income dividends their invested principal in the account","page_number":152,"box":{"x":102,"y":778,"width":789,"height":11}},{"id":"4172c414-530c-4839-97e9-aeab3f054f04","block_type":"box","text":"will be depleted. To participate in the SWP, shareholders must have their dividends automatically reinvested.","page_number":152,"box":{"x":68,"y":793,"width":774,"height":11}},{"id":"97208d46-be22-482c-8791-f804de54beaf","block_type":"box","text":"Shareholders may change or cancel the SWP at any time, upon written notice to the Fund, or by calling the Fund at","page_number":152,"box":{"x":69,"y":808,"width":815,"height":11}},{"id":"bf767cdb-60b3-4741-a45b-bc119623f519","block_type":"box","text":"(800) 441-7762. Purchases of additional Investor A or Investor P Shares of the Fund concurrently with withdrawals","page_number":152,"box":{"x":69,"y":823,"width":817,"height":11}},{"id":"587b021c-b91a-4e9c-91d8-fa02e7f7cd2d","block_type":"box","text":"may be disadvantageous to investors because of the sales charges involved and, therefore, are discouraged. No","page_number":152,"box":{"x":69,"y":838,"width":803,"height":12}},{"id":"3b8cff7c-e942-44fe-b4b0-493ba41a4bc8","block_type":"box","text":"CDSC will be assessed on redemptions of Investor C Shares made through the SWP that do not exceed 12% of the","page_number":152,"box":{"x":69,"y":853,"width":820,"height":12}},{"id":"71eebad6-d9b4-4cd6-992c-0745778acb92","block_type":"box","text":"original investment on an annualized basis. For example, monthly, quarterly and semi-annual SWP redemptions of","page_number":152,"box":{"x":69,"y":869,"width":810,"height":11}},{"id":"60ea7a5a-e7cf-44a7-a5df-88caa97ac17c","block_type":"box","text":"II-121","page_number":152,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"69a4faf6-d459-4bfc-96ee-25762b4b5ca0","block_type":"box","text":"NM0926U-5977317-152/232","page_number":152,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"abefb054-9c9f-4f97-a4b4-e6d63a30070e","block_type":"box","text":"Investor C Shares will not be subject to the CDSC if they do not exceed 1% (monthly), 3% (quarterly) and 6% (semi","page_number":153,"box":{"x":70,"y":45,"width":816,"height":11}},{"id":"1d7d9485-f907-43f6-88e7-5711ded92ac3","block_type":"box","text":"annually), respectively, of an account’s NAV on the redemption date. SWP redemptions of Investor C Shares in excess","page_number":153,"box":{"x":69,"y":60,"width":840,"height":11}},{"id":"049b366e-e578-4424-a05c-d9b21c487ec6","block_type":"box","text":"of this limit are still subject to the applicable CDSC.","page_number":153,"box":{"x":69,"y":75,"width":367,"height":11}},{"id":"c0ef3d10-0bfd-4d81-97e8-9a531f3ba564","block_type":"box","text":"For this reason, a shareholder may not participate in the Automatic Investment Plan described above (see “How","page_number":153,"box":{"x":102,"y":98,"width":798,"height":11}},{"id":"19cb4091-e309-4a52-91f6-64a5908b10d4","block_type":"box","text":"to Buy, Sell, Exchange and Transfer Shares” or “How to Buy, Sell and Exchange Shares,” as applicable, in the Fund’s","page_number":153,"box":{"x":68,"y":113,"width":834,"height":11}},{"id":"3ee9e25d-5cf9-45f4-925a-686d6fb9d70f","block_type":"box","text":"Prospectus) and the SWP at the same time.","page_number":153,"box":{"x":69,"y":128,"width":311,"height":11}},{"id":"4fb9c96c-d4e2-4bdd-8e76-84ca9f1e0372","block_type":"box","text":"Dividend Allocation Plan","page_number":153,"box":{"x":69,"y":158,"width":176,"height":9}},{"id":"31113bc1-6278-458c-8f73-f760d9e29ad5","block_type":"box","text":"The Dividend Allocation Plan, as applicable, allows shareholders to elect to have all their dividends and any other","page_number":153,"box":{"x":101,"y":181,"width":807,"height":11}},{"id":"99231b27-918c-4f4a-874b-c2bca56416df","block_type":"box","text":"distributions from any Eligible Fund (which means funds so designated by the Distributor from time to time)","page_number":153,"box":{"x":69,"y":196,"width":763,"height":11}},{"id":"f7fa70ec-072a-4fb2-8532-b9a731f42f7f","block_type":"box","text":"automatically invested at NAV in one other such Eligible Fund designated by the shareholder, provided the account","page_number":153,"box":{"x":69,"y":211,"width":814,"height":11}},{"id":"f4298dc1-dd32-4bc2-9c8b-503fc05ab426","block_type":"box","text":"into which the dividends and distributions are directed is initially funded with the requisite minimum amount.","page_number":153,"box":{"x":70,"y":226,"width":771,"height":11}},{"id":"f2194748-3b8f-4ae6-bace-2d8ceca4c191","block_type":"box","text":"PRICING OF SHARES","page_number":153,"box":{"x":406,"y":256,"width":167,"height":9}},{"id":"36d80efa-fe49-4090-86c1-3b36426b2317","block_type":"box","text":"Determination of Net Asset Value","page_number":153,"box":{"x":69,"y":286,"width":243,"height":9}},{"id":"14ae3818-985f-4511-bbc4-d87819f6c651","block_type":"box","text":"Valuation of Shares.","page_number":153,"box":{"x":101,"y":309,"width":145,"height":9}},{"id":"cae3be51-7390-420c-bd01-ea855db56d8c","block_type":"box","text":"The NAV for each class of shares of each Fund is generally calculated as of the close of","page_number":153,"box":{"x":252,"y":309,"width":626,"height":11}},{"id":"b0d5e45b-0719-4e16-aeb2-ba304d02caa1","block_type":"box","text":"regular trading hours on the NYSE (currently 4:00 p.m. Eastern Time) on each business day the NYSE is open.","page_number":153,"box":{"x":69,"y":324,"width":785,"height":11}},{"id":"806eb00b-6393-4a78-abc2-3f1b185e67b6","block_type":"box","text":"Valuation of assets held by a Fund is as follows:","page_number":153,"box":{"x":68,"y":339,"width":343,"height":11}},{"id":"be85d380-5536-4cca-8736-ae081ae98f95","block_type":"box","text":"Equity Investments.","page_number":153,"box":{"x":102,"y":362,"width":143,"height":11}},{"id":"4ddd55b8-c7b6-42ef-a52a-346bd7882c6d","block_type":"box","text":"Equity securities traded on a recognized securities exchange (","page_number":153,"box":{"x":252,"y":362,"width":439,"height":11}},{"id":"18d885e9-92d1-4353-b2de-3a0db01a0cb8","block_type":"box","text":"e.g.","page_number":153,"box":{"x":693,"y":363,"width":25,"height":10}},{"id":"877c3b17-b107-481c-93f3-36d00c9564e3","block_type":"box","text":", NYSE), on separate","page_number":153,"box":{"x":720,"y":362,"width":147,"height":11}},{"id":"3cb329d3-5a9d-40f4-96a8-bf20d9685ea3","block_type":"box","text":"trading boards of a securities exchange or through a market system that provides contemporaneous transaction","page_number":153,"box":{"x":68,"y":377,"width":799,"height":11}},{"id":"7c2c3030-ab5f-4275-9ec2-c8249ae44724","block_type":"box","text":"pricing information (each, an “Exchange”) are valued using information obtained via independent pricing services,","page_number":153,"box":{"x":70,"y":392,"width":808,"height":11}},{"id":"41004417-9411-4660-82d3-cd7c71d65603","block_type":"box","text":"generally at the Exchange closing price or if an Exchange closing price is not available, the last traded price on that","page_number":153,"box":{"x":68,"y":407,"width":820,"height":11}},{"id":"218a674b-7cad-44d9-9efb-c74e68cebd8b","block_type":"box","text":"Exchange prior to the time as of which the assets or liabilities are valued. However, under certain circumstances,","page_number":153,"box":{"x":70,"y":422,"width":805,"height":11}},{"id":"d4393b70-53dc-4516-89f4-6c9bde3633fd","block_type":"box","text":"other means of determining current market value may be used. If an equity security is traded on more than one","page_number":153,"box":{"x":69,"y":437,"width":793,"height":11}},{"id":"aec77a34-e5db-48a9-b480-ea938035b135","block_type":"box","text":"Exchange, the current market value of the security where it is primarily traded generally will be used. In the event that","page_number":153,"box":{"x":70,"y":452,"width":836,"height":11}},{"id":"725c269c-b918-427a-8a91-c8629525c411","block_type":"box","text":"there are no sales involving an equity security held by a Fund on a day on which the Fund values such security, the","page_number":153,"box":{"x":68,"y":468,"width":815,"height":11}},{"id":"0ad78170-f6e5-498f-89b2-272663b89bf4","block_type":"box","text":"last bid (long positions) or ask (short positions) price, if available, will be used as the value of such security. If a Fund","page_number":153,"box":{"x":70,"y":482,"width":837,"height":12}},{"id":"437f4d1a-4305-4903-8337-d42153652590","block_type":"box","text":"holds both long and short positions in the same security, the last bid price will be applied to securities held long and","page_number":153,"box":{"x":69,"y":498,"width":832,"height":11}},{"id":"5ba9d28a-bd93-4d81-9925-181158ff637a","block_type":"box","text":"the last ask price will be applied to securities sold short. If no bid or ask price is available on a day on which a Fund","page_number":153,"box":{"x":68,"y":513,"width":828,"height":11}},{"id":"8a9f8126-9018-4cc2-ae5d-f2f72d87d06e","block_type":"box","text":"values such security, the prior day’s price will be used, unless BlackRock determines that such prior day’s price no","page_number":153,"box":{"x":68,"y":528,"width":819,"height":11}},{"id":"ba8c07ac-4759-48d8-acea-8f44a896c3c9","block_type":"box","text":"longer reflects the fair value of the security, in which case such asset would be treated as a Fair Value Asset (as","page_number":153,"box":{"x":70,"y":543,"width":798,"height":11}},{"id":"e60434bc-524b-45de-8fcd-01f9b346339d","block_type":"box","text":"defined below).","page_number":153,"box":{"x":69,"y":558,"width":106,"height":11}},{"id":"2716400b-1412-4120-a2fa-e64f4e4df415","block_type":"box","text":"Fixed-Income Investments.","page_number":153,"box":{"x":102,"y":581,"width":194,"height":9}},{"id":"60c9de42-86c5-49a3-8c37-aa932c8d9a0b","block_type":"box","text":"Fixed-income securities are generally valued using prices provided by dealers or","page_number":153,"box":{"x":304,"y":581,"width":565,"height":11}},{"id":"87646901-6df1-4fe1-8e95-f4590bb30998","block_type":"box","text":"prices (including evaluated prices) supplied by the Fund’s approved independent third-party pricing services, each in","page_number":153,"box":{"x":70,"y":596,"width":825,"height":11}},{"id":"f78618bf-11db-470e-b02d-a05d08ccc8bd","block_type":"box","text":"accordance with the Valuation Procedures. The pricing services may use valuation models that utilize certain inputs","page_number":153,"box":{"x":69,"y":611,"width":823,"height":11}},{"id":"1a948893-24b1-45f6-91bd-8823e6cc8be4","block_type":"box","text":"and assumptions to derive values, including transaction data (","page_number":153,"box":{"x":69,"y":626,"width":443,"height":11}},{"id":"ca4ec84c-94e1-4afc-855e-2d00b6124ec9","block_type":"box","text":"e.g.","page_number":153,"box":{"x":514,"y":628,"width":24,"height":9}},{"id":"25c5a319-d2e0-4843-a977-15a7afad8593","block_type":"box","text":", recent representative bids and offers), credit","page_number":153,"box":{"x":541,"y":626,"width":328,"height":11}},{"id":"688b490a-21db-42ad-a75f-1b717c7402e2","block_type":"box","text":"quality information, perceived market movements, news, and other relevant information and by other methods, which","page_number":153,"box":{"x":69,"y":641,"width":834,"height":11}},{"id":"ab63c8c0-fdf0-41db-9f2c-0024a141adea","block_type":"box","text":"may include consideration of: yields or prices of securities of comparable quality, coupon, maturity and type;","page_number":153,"box":{"x":69,"y":656,"width":769,"height":11}},{"id":"95906cc4-da7d-408e-a1dd-7e0d0a2f1351","block_type":"box","text":"indications as to values from dealers; general market conditions; and/or other factors and assumptions. Pricing","page_number":153,"box":{"x":70,"y":671,"width":797,"height":12}},{"id":"3cca2031-3153-4781-874e-7eddd37389ce","block_type":"box","text":"services generally value fixed-income securities assuming orderly transactions of an institutional round lot size, but","page_number":153,"box":{"x":69,"y":686,"width":821,"height":12}},{"id":"2152ee7b-28da-4fcd-895e-1e98f88384a5","block_type":"box","text":"the Fund may hold or transact in such securities in smaller, odd lot sizes. Odd lots of securities in certain asset","page_number":153,"box":{"x":68,"y":702,"width":798,"height":11}},{"id":"0a87bc50-15a8-474c-8b7f-f94759552f77","block_type":"box","text":"classes may trade at lower prices than institutional round lots, and the value ultimately realized when the securities","page_number":153,"box":{"x":69,"y":717,"width":825,"height":11}},{"id":"4398d65a-8711-4bdb-8d25-5ae238cba6b3","block_type":"box","text":"are sold could differ from the prices used by a Fund. The amortized cost method of valuation may be used with","page_number":153,"box":{"x":69,"y":732,"width":791,"height":11}},{"id":"373cde60-18ca-4c9b-b4ff-94d5949ed88e","block_type":"box","text":"respect to debt obligations with 60 days or less remaining to maturity unless such method does not represent fair","page_number":153,"box":{"x":69,"y":747,"width":814,"height":11}},{"id":"93d51ae5-e1fa-4d05-a533-0fd82666deb6","block_type":"box","text":"value. Certain fixed-income investments, including asset-backed and mortgage related securities, may be valued","page_number":153,"box":{"x":68,"y":762,"width":802,"height":11}},{"id":"405557f7-bd43-4fd4-9199-8607784961f2","block_type":"box","text":"based on valuation models that consider the estimated cash flows of each tranche of the issuer, establish a","page_number":153,"box":{"x":69,"y":777,"width":773,"height":11}},{"id":"d78d5a49-2ec6-478b-b1bc-1d8ece792d89","block_type":"box","text":"benchmark yield and develop an estimated tranche specific spread to the benchmark yield based on the unique","page_number":153,"box":{"x":69,"y":792,"width":795,"height":12}},{"id":"3170742d-316f-447b-a59c-74ab26b11165","block_type":"box","text":"attributes of the tranche.","page_number":153,"box":{"x":69,"y":807,"width":176,"height":9}},{"id":"c7681a20-8e5d-4ca4-a22b-d1f5862ffaf2","block_type":"box","text":"Options, Futures, Swaps and Other Derivatives.","page_number":153,"box":{"x":101,"y":830,"width":344,"height":11}},{"id":"ae568723-9684-4c74-aadd-d6837799774e","block_type":"box","text":"Exchange-traded equity options (except ETF options, equity","page_number":153,"box":{"x":453,"y":830,"width":416,"height":11}},{"id":"30db9aa3-9327-41b3-a964-f81bfa6beae7","block_type":"box","text":"index options or those that are customized) for which market quotations are readily available are valued at the mean","page_number":153,"box":{"x":70,"y":845,"width":829,"height":11}},{"id":"2cea4c8b-7648-4ada-bdf3-5b665f625459","block_type":"box","text":"of the last bid and ask prices as quoted on the Exchange or the board of trade on which such options are traded. In","page_number":153,"box":{"x":69,"y":860,"width":824,"height":12}},{"id":"67b0f1cf-a0d4-4880-b434-993c00b59a43","block_type":"box","text":"the event that there is no mean price available for an exchange-traded equity option held by a Fund on a day on which","page_number":153,"box":{"x":68,"y":875,"width":838,"height":12}},{"id":"3f8fb073-feb2-45ac-a26d-6b578a8c420a","block_type":"box","text":"the Fund values such option, the last bid (long positions) or ask (short positions) price, if available, will be used as","page_number":153,"box":{"x":68,"y":891,"width":820,"height":11}},{"id":"5f9e0465-27de-40cb-8acd-4bef56c12073","block_type":"box","text":"the value of such option. If no bid or ask price is available on a day on which a Fund values such option, the prior","page_number":153,"box":{"x":68,"y":906,"width":808,"height":11}},{"id":"a3278c20-3b68-4725-a696-f9da63be2711","block_type":"box","text":"II-122","page_number":153,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"b15efc9a-12f6-4341-8057-e19a8b4bf022","block_type":"box","text":"NM0926U-5977317-153/232","page_number":153,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"ba1ad841-d8a8-4997-b313-37fa866e0f99","block_type":"box","text":"day’s price will be used, unless BlackRock determines that such prior day’s price no longer reflects the fair value of","page_number":154,"box":{"x":69,"y":45,"width":824,"height":11}},{"id":"649ecaa4-80f5-4e09-9dc6-8d408be11a99","block_type":"box","text":"the option, in which case such option will be treated as a Fair Value Asset. Customized exchange-traded equity","page_number":154,"box":{"x":68,"y":60,"width":789,"height":11}},{"id":"d297db18-01b3-43a6-8505-0252ce228a0b","block_type":"box","text":"options, ETF options, equity index options and OTC derivatives, may be valued using a mathematical model which","page_number":154,"box":{"x":69,"y":75,"width":807,"height":11}},{"id":"f1f4b93b-09ce-47a4-80e0-e68650c83825","block_type":"box","text":"may incorporate a number of market data factors. Financial futures contracts and options thereon, which are traded","page_number":154,"box":{"x":69,"y":90,"width":824,"height":11}},{"id":"0dbee502-b634-48a2-902b-cc74bb3f3b04","block_type":"box","text":"on exchanges, are valued at their last sale price or settle price as of the close of such exchanges. Swap agreements","page_number":154,"box":{"x":69,"y":105,"width":833,"height":11}},{"id":"a876eacf-d46d-4ddc-8d0a-872d840be7c4","block_type":"box","text":"and other derivatives are generally valued daily based upon quotations from market makers or by a pricing service in","page_number":154,"box":{"x":69,"y":120,"width":830,"height":12}},{"id":"8d865e8a-4e50-43de-998f-ffa8dc6feb56","block_type":"box","text":"accordance with the Valuation Procedures.","page_number":154,"box":{"x":69,"y":136,"width":301,"height":8}},{"id":"714124ee-9767-4ef4-9732-815dcd46882a","block_type":"box","text":"Underlying Funds.","page_number":154,"box":{"x":102,"y":158,"width":128,"height":11}},{"id":"b066c58d-5e82-444d-bc3a-0b8f54aa807c","block_type":"box","text":"Shares of underlying open-end funds that are not traded on an exchange (including money","page_number":154,"box":{"x":237,"y":158,"width":640,"height":11}},{"id":"724639f4-c2a5-4f09-8ff7-8d59c86b2f1d","block_type":"box","text":"market funds) are valued at NAV. Shares of underlying exchange-traded closed-end funds or other ETFs will be valued","page_number":154,"box":{"x":69,"y":173,"width":830,"height":11}},{"id":"ee6150a5-ffe0-43f1-9ec1-70284b27a4f6","block_type":"box","text":"at their most recent closing price.","page_number":154,"box":{"x":69,"y":188,"width":238,"height":12}},{"id":"4951a67e-2ce6-4d30-af6d-209cc08d88d9","block_type":"box","text":"General Valuation Information.","page_number":154,"box":{"x":101,"y":211,"width":220,"height":9}},{"id":"517f244e-7672-4bc7-a183-eb1cdadfbe3c","block_type":"box","text":"Prices obtained from independent third-party pricing services, broker-dealers or","page_number":154,"box":{"x":328,"y":211,"width":564,"height":11}},{"id":"7c1961cf-6997-43f4-a690-0371a3a418a1","block_type":"box","text":"market makers to value each Fund’s securities and other assets and liabilities are based on information available at","page_number":154,"box":{"x":69,"y":226,"width":831,"height":9}},{"id":"1bf7c2c8-d2cb-48a0-9c3f-851df88f852e","block_type":"box","text":"the time the Fund values its assets and liabilities. In the event that a pricing service quotation is revised or updated","page_number":154,"box":{"x":68,"y":241,"width":828,"height":11}},{"id":"253328cf-1ea1-4f49-b154-949c58c0ea16","block_type":"box","text":"subsequent to the day on which the Fund valued such security, the revised pricing service quotation generally will be","page_number":154,"box":{"x":69,"y":257,"width":829,"height":11}},{"id":"ea2012c4-5a75-4673-a627-bb711b7e19b4","block_type":"box","text":"applied prospectively. Such determination will be made considering pertinent facts and circumstances surrounding","page_number":154,"box":{"x":69,"y":271,"width":817,"height":12}},{"id":"3e9b3d6a-1f5b-450a-9670-c133fe6b6906","block_type":"box","text":"the revision.","page_number":154,"box":{"x":68,"y":287,"width":87,"height":9}},{"id":"a1dce6dd-7ad1-4ebc-af30-ed103bcf6404","block_type":"box","text":"In determining the market value of portfolio investments, the Fund may employ independent third-party pricing","page_number":154,"box":{"x":102,"y":309,"width":784,"height":11}},{"id":"137ab0e7-ae31-41e5-b358-ca7125511a59","block_type":"box","text":"services, which may use, without limitation, evaluated pricing methods that take into consideration market indexes,","page_number":154,"box":{"x":69,"y":325,"width":823,"height":11}},{"id":"9bde2a40-f89e-454a-a7e8-e5a4ed721fd6","block_type":"box","text":"matrices, yield curves and other specified inputs and assumptions. This may result in the assets being valued at a","page_number":154,"box":{"x":69,"y":339,"width":818,"height":12}},{"id":"9bde1907-4af7-4adc-b943-ec3c68c83bdc","block_type":"box","text":"price different from the price that would have been determined had the evaluated pricing method not been used. The","page_number":154,"box":{"x":70,"y":355,"width":832,"height":11}},{"id":"bf2c0b36-8285-49d6-bd18-74115ee8e7e3","block_type":"box","text":"price the Fund could receive upon the sale of any particular portfolio investment may differ from the Fund’s valuation","page_number":154,"box":{"x":70,"y":370,"width":832,"height":11}},{"id":"7bad38da-f186-4c8e-96d1-91571e3b12d2","block_type":"box","text":"of the investment, particularly for assets that trade in thin or volatile markets or that are valued using a fair valuation","page_number":154,"box":{"x":69,"y":385,"width":834,"height":11}},{"id":"3c164c32-aba8-4c62-9b81-07f0ebcd0e3e","block_type":"box","text":"methodology or a price provided by an independent pricing service. As a result, the price received upon the sale of an","page_number":154,"box":{"x":69,"y":400,"width":837,"height":11}},{"id":"5e9e7dc1-a51e-4993-a701-6339cd7f6f63","block_type":"box","text":"investment may be less than the value ascribed by the Fund, and the Fund could realize a greater than expected loss","page_number":154,"box":{"x":70,"y":415,"width":833,"height":11}},{"id":"96a16a59-7dac-4b4e-90db-4d61028e5992","block_type":"box","text":"or lesser than expected gain upon the sale of the investment. The Fund’s ability to value its investment may also be","page_number":154,"box":{"x":69,"y":430,"width":827,"height":11}},{"id":"44de0d62-06f5-41ac-b03d-972d62440815","block_type":"box","text":"impacted by technological issues and/or errors by pricing services or other third-party service providers.","page_number":154,"box":{"x":70,"y":446,"width":741,"height":11}},{"id":"4ef055d4-82c3-4b3d-a411-19b6dac8f48b","block_type":"box","text":"In the event that application of the methods of valuation discussed above result in a price for a security which is","page_number":154,"box":{"x":102,"y":468,"width":800,"height":11}},{"id":"7d1ea67b-ceee-45a0-a2cc-fdfd8d2d31d6","block_type":"box","text":"deemed not to be representative of the fair market value of such security, the security will be valued by, under the","page_number":154,"box":{"x":69,"y":483,"width":811,"height":11}},{"id":"d8b9012f-d35a-483e-9f91-bd3e6601e2fb","block_type":"box","text":"direction of or in accordance with a method approved by BlackRock, the Fund’s valuation designee, as reflecting fair","page_number":154,"box":{"x":69,"y":498,"width":827,"height":11}},{"id":"12746f79-ddce-4737-9a43-a4af099f3280","block_type":"box","text":"value. All other assets and liabilities (including securities for which market quotations are not readily available) held","page_number":154,"box":{"x":68,"y":513,"width":824,"height":12}},{"id":"0380e6a6-7ada-4753-85f7-6ab28b3b90ce","block_type":"box","text":"by a Fund (including restricted securities and private market investments, as applicable) are valued at fair value as","page_number":154,"box":{"x":69,"y":528,"width":817,"height":12}},{"id":"2127d0bd-b048-46af-9e5a-4fb5485c9596","block_type":"box","text":"determined in good faith by BlackRock pursuant to the Valuation Procedures. Any assets and liabilities which are","page_number":154,"box":{"x":69,"y":543,"width":802,"height":12}},{"id":"d41df09a-8e0b-4a45-929a-4f02bd2ece55","block_type":"box","text":"denominated in a foreign currency are translated into U.S. dollars at the prevailing market rates.","page_number":154,"box":{"x":69,"y":559,"width":685,"height":11}},{"id":"96ac3814-7dda-435a-b52d-95f0abc86d30","block_type":"box","text":"Certain of the securities acquired by the Funds may be traded on foreign exchanges or OTC markets on days on","page_number":154,"box":{"x":102,"y":581,"width":795,"height":12}},{"id":"663ee316-f55c-4cb0-acfb-c184ee3931da","block_type":"box","text":"which a Fund’s NAV is not calculated. In such cases, the NAV of a Fund’s shares may be significantly affected on","page_number":154,"box":{"x":68,"y":596,"width":805,"height":12}},{"id":"cbb3bc74-3ff5-4b86-9b2f-b1931c4f6eec","block_type":"box","text":"days when investors can neither purchase nor redeem shares of the Fund.","page_number":154,"box":{"x":69,"y":612,"width":529,"height":11}},{"id":"df8a7fc1-54d8-44c1-b949-72f93ae05045","block_type":"box","text":"Fair Value.","page_number":154,"box":{"x":102,"y":634,"width":74,"height":9}},{"id":"f9a90d83-024f-4d31-8500-90adf1225132","block_type":"box","text":"When market quotations are not readily available or are believed by BlackRock to be unreliable, a","page_number":154,"box":{"x":183,"y":634,"width":693,"height":11}},{"id":"1935c845-7393-4d86-9c63-a49f099132e7","block_type":"box","text":"Fund’s investments are valued at fair value (“Fair Value Assets”). Fair Value Assets are valued by BlackRock in","page_number":154,"box":{"x":70,"y":649,"width":785,"height":12}},{"id":"8e8fc1da-eb2c-4ece-a7c3-96c1fd951d9d","block_type":"box","text":"accordance with the Valuation Procedures. Pursuant to Rule 2a-5 under the Investment Company Act, the Board of","page_number":154,"box":{"x":69,"y":664,"width":816,"height":12}},{"id":"46fa8b7d-278b-4900-8680-5826eec8b653","block_type":"box","text":"Directors has designated BlackRock as the valuation designee for the respective Funds for which it serves as","page_number":154,"box":{"x":70,"y":680,"width":779,"height":11}},{"id":"a07d0576-422e-482f-9934-24f70c0a3d0b","block_type":"box","text":"investment adviser. BlackRock may reasonably conclude that a market quotation is not readily available or is","page_number":154,"box":{"x":70,"y":695,"width":773,"height":11}},{"id":"543184ca-30b3-459f-a16f-7988ee183921","block_type":"box","text":"unreliable if, among other things, a security or other asset or liability does not have a price source due to its","page_number":154,"box":{"x":69,"y":710,"width":772,"height":11}},{"id":"2f6870e1-237b-468f-aad7-b98a356ce024","block_type":"box","text":"complete lack of trading, if BlackRock believes a market quotation from a broker-dealer or other source is unreliable","page_number":154,"box":{"x":69,"y":725,"width":826,"height":11}},{"id":"cf35634c-ba1b-49f1-a2f2-f9fbc8debe5f","block_type":"box","text":"(","page_number":154,"box":{"x":69,"y":740,"width":3,"height":11}},{"id":"8aea746f-d46c-4dc4-9c7f-dd4ba6469d63","block_type":"box","text":"e.g.","page_number":154,"box":{"x":74,"y":742,"width":25,"height":9}},{"id":"d3b86181-486a-478e-ad6d-724672d4aa60","block_type":"box","text":", where it varies significantly from a recent trade, or no longer reflects the fair value of the security or other asset","page_number":154,"box":{"x":101,"y":740,"width":806,"height":11}},{"id":"da7d881f-2d0d-42ce-97ff-d915eb94490d","block_type":"box","text":"or liability subsequent to the most recent market quotation), or where the security or other asset or liability is only","page_number":154,"box":{"x":69,"y":755,"width":813,"height":11}},{"id":"ab2c42f4-ec2b-4ffc-8b34-72333063cf5e","block_type":"box","text":"thinly traded or due to the occurrence of a significant event subsequent to the most recent market quotation. For this","page_number":154,"box":{"x":68,"y":770,"width":837,"height":12}},{"id":"949311ee-5d97-4608-b2d5-b792c8807897","block_type":"box","text":"purpose, a “significant event” is deemed to occur if BlackRock determines, in its reasonable business judgment, that","page_number":154,"box":{"x":70,"y":785,"width":838,"height":12}},{"id":"e2f1ba60-0df8-4df3-bd57-d0d31d38dc1a","block_type":"box","text":"an event has occurred after the close of trading for an asset or liability but prior to or at the time of pricing a Fund’s","page_number":154,"box":{"x":69,"y":801,"width":824,"height":11}},{"id":"bbc3499f-1c8d-4801-bfab-9a98a4fa6d96","block_type":"box","text":"assets or liabilities, is likely to cause a material change to the last exchange closing price or closing market price of","page_number":154,"box":{"x":69,"y":816,"width":828,"height":11}},{"id":"fbcdd93f-9faf-4a45-b493-c6efc2fb929a","block_type":"box","text":"one or more assets held by, or liabilities of, the Fund. On any day the NYSE is open and a foreign market or the","page_number":154,"box":{"x":69,"y":831,"width":793,"height":11}},{"id":"0997e736-25b7-47ed-bfd7-c6f3f745e5a0","block_type":"box","text":"primary exchange on which a foreign asset or liability is traded is closed, such asset or liability will be valued using","page_number":154,"box":{"x":70,"y":846,"width":819,"height":11}},{"id":"bda28791-37ac-402e-943c-0c07d8ddb5a2","block_type":"box","text":"the prior day’s price, provided that BlackRock is not aware of any significant event or other information that would","page_number":154,"box":{"x":68,"y":861,"width":810,"height":11}},{"id":"d6658091-d331-4e88-9328-20bcb0b879b7","block_type":"box","text":"cause such price to no longer reflect the fair value of the asset or liability, in which case such asset or liability would","page_number":154,"box":{"x":69,"y":876,"width":828,"height":11}},{"id":"e4cb38c3-429b-42c4-a837-1b79346ceb10","block_type":"box","text":"be treated as a Fair Value Asset. For certain foreign assets, a third-party vendor supplies evaluated, systematic fair","page_number":154,"box":{"x":69,"y":891,"width":822,"height":12}},{"id":"4515efdc-d3f4-4072-8a46-7ff78be78799","block_type":"box","text":"value pricing based upon the movement of a proprietary multi-factor model after the relevant foreign markets have","page_number":154,"box":{"x":68,"y":906,"width":814,"height":12}},{"id":"f6985067-c840-41d4-93c5-73f99b7787c1","block_type":"box","text":"II-123","page_number":154,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"afdc7f08-6f71-4e3c-8f65-52a5aaa4f15a","block_type":"box","text":"NM0926U-5977317-154/232","page_number":154,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"c7912a78-7e80-42cc-a253-ff3981fb2816","block_type":"box","text":"closed. This systematic fair value pricing methodology is designed to correlate the prices of foreign assets in one or","page_number":155,"box":{"x":69,"y":45,"width":827,"height":11}},{"id":"58fded3d-bf82-4bc7-ab22-c0bd4959a387","block_type":"box","text":"more non-U.S. markets following the close of the local markets to the prices that might have prevailed as of a Fund’s","page_number":155,"box":{"x":69,"y":60,"width":834,"height":11}},{"id":"dc0f03a2-fbb3-49bf-badb-83bc2c161cf0","block_type":"box","text":"pricing time.","page_number":155,"box":{"x":70,"y":75,"width":85,"height":11}},{"id":"0f80aef8-3849-44b6-8339-75a7641f1ae8","block_type":"box","text":"BlackRock’s Rule 2a-5 Committee is responsible for reviewing and approving methodologies by investment type","page_number":155,"box":{"x":102,"y":98,"width":794,"height":11}},{"id":"50e8e402-3233-4849-8915-5c9218bf79ef","block_type":"box","text":"and significant inputs used in the fair valuation of Fund assets or liabilities. In addition, the Funds’ accounting agent","page_number":155,"box":{"x":69,"y":113,"width":829,"height":11}},{"id":"423468f4-f14f-4e90-a2f0-b09d3b0358dc","block_type":"box","text":"assists BlackRock by periodically endeavoring to confirm the prices it receives from all third-party pricing services,","page_number":155,"box":{"x":69,"y":128,"width":813,"height":11}},{"id":"702d1da7-50d0-4981-992d-8cfd5e440817","block_type":"box","text":"index providers and broker-dealers. BlackRock regularly evaluates the values assigned to the securities and other","page_number":155,"box":{"x":70,"y":143,"width":808,"height":11}},{"id":"37ca27f8-6156-4bff-bc64-ea9be73719a3","block_type":"box","text":"assets and liabilities of the Funds.","page_number":155,"box":{"x":69,"y":158,"width":245,"height":9}},{"id":"2760bd3b-80e7-48e4-a425-ba157114c6e7","block_type":"box","text":"When determining the price for a Fair Value Asset, BlackRock will seek to determine the price that a Fund might","page_number":155,"box":{"x":101,"y":181,"width":795,"height":11}},{"id":"1bc5213b-3fed-4066-a40a-69de1752bc0a","block_type":"box","text":"reasonably expect to receive from the current sale of that asset or liability in an arm’s-length transaction on the date","page_number":155,"box":{"x":69,"y":196,"width":832,"height":11}},{"id":"b662e686-d0a1-43ea-8118-7d0eac8a393e","block_type":"box","text":"on which the asset or liability is being valued, and does not seek to determine the price a Fund might reasonably","page_number":155,"box":{"x":69,"y":211,"width":805,"height":11}},{"id":"4c55ddae-23ff-45ac-955e-de89917b3931","block_type":"box","text":"expect to receive for selling an asset or liability at a later time or if it holds the asset or liability to maturity. Fair value","page_number":155,"box":{"x":69,"y":226,"width":834,"height":11}},{"id":"2a246327-94b7-4d2e-9575-201db05bc079","block_type":"box","text":"determinations will be based upon all available factors that BlackRock deems relevant at the time of the","page_number":155,"box":{"x":69,"y":241,"width":744,"height":11}},{"id":"43f63ee8-4c19-41be-aa57-52a643423494","block_type":"box","text":"determination, and may be based on analytical values determined by BlackRock using proprietary or third-party","page_number":155,"box":{"x":69,"y":257,"width":791,"height":11}},{"id":"120315ef-cc30-40c7-bfe9-5066e8b8db4a","block_type":"box","text":"valuation models.","page_number":155,"box":{"x":68,"y":272,"width":125,"height":8}},{"id":"5d7be371-b3b4-412f-a634-81e946481cbd","block_type":"box","text":"Fair value represents a good faith approximation of the value of an asset or liability. When determining the fair","page_number":155,"box":{"x":102,"y":294,"width":785,"height":11}},{"id":"eaeeea2d-3015-4984-be5d-913e66425677","block_type":"box","text":"value of an investment, one or more fair value methodologies may be used (depending on certain factors, including","page_number":155,"box":{"x":68,"y":309,"width":822,"height":11}},{"id":"04a1d1db-0995-4214-b6b0-149864497917","block_type":"box","text":"the asset type). For example, the investment may be initially priced based on the original cost of the investment or,","page_number":155,"box":{"x":68,"y":324,"width":820,"height":12}},{"id":"9fd738a2-224a-4aa9-ba02-55f2ec117a0d","block_type":"box","text":"alternatively, using proprietary or third-party models that may rely upon one or more unobservable inputs. Prices of","page_number":155,"box":{"x":69,"y":339,"width":818,"height":12}},{"id":"e8fb8ab2-a6b0-4562-8746-9c97e68a715f","block_type":"box","text":"actual, executed or historical transactions in the relevant investment (or comparable instruments) or, where","page_number":155,"box":{"x":69,"y":355,"width":766,"height":11}},{"id":"b118b703-3eba-4d65-b7e8-c48f29887e1f","block_type":"box","text":"appropriate, an appraisal by a third-party experienced in the valuation of similar instruments, may also be used as a","page_number":155,"box":{"x":69,"y":370,"width":828,"height":11}},{"id":"6abba01f-ec77-4ec6-8d96-312d05754ea3","block_type":"box","text":"basis for establishing the fair value of an investment.","page_number":155,"box":{"x":69,"y":385,"width":378,"height":11}},{"id":"9ba9fce4-8e07-4c98-b577-267f62dad87c","block_type":"box","text":"The fair value of one or more assets or liabilities may not, in retrospect, be the price at which those assets or","page_number":155,"box":{"x":101,"y":407,"width":784,"height":12}},{"id":"6794a5e4-8d60-4bf9-8932-e6e7d6c1fa5b","block_type":"box","text":"liabilities could have been sold during the period in which the particular fair values were used in determining a Fund’s","page_number":155,"box":{"x":70,"y":423,"width":836,"height":11}},{"id":"eb1821b4-21d5-44f3-abf5-eb1560a5af87","block_type":"box","text":"NAV. As a result, a Fund’s sale or redemption of its shares at NAV, at a time when a holding or holdings are valued at","page_number":155,"box":{"x":70,"y":438,"width":834,"height":11}},{"id":"0b951040-d689-466c-85b0-6c6b574a53a9","block_type":"box","text":"fair value, may have the effect of diluting or increasing the economic interest of existing shareholders.","page_number":155,"box":{"x":68,"y":453,"width":728,"height":11}},{"id":"b371aace-3acb-4497-a551-67d95d73646b","block_type":"box","text":"Each Fund’s annual audited financial statements, which are prepared in accordance with accounting principles","page_number":155,"box":{"x":102,"y":475,"width":786,"height":12}},{"id":"96d91a87-43b3-4ac4-b203-337c24979566","block_type":"box","text":"generally accepted in the United States of America (“US GAAP”), follow the requirements for valuation set forth in","page_number":155,"box":{"x":68,"y":491,"width":809,"height":11}},{"id":"59b816a8-b982-41dd-942b-5a63257b12fd","block_type":"box","text":"Financial Accounting Standards Board Accounting Standards Codification Topic 820, “Fair Value Measurements and","page_number":155,"box":{"x":70,"y":506,"width":821,"height":11}},{"id":"b8c60f16-34a5-4574-8b8a-2d5d7dcabb61","block_type":"box","text":"Disclosures” (“ASC 820”), which defines and establishes a framework for measuring fair value under US GAAP and","page_number":155,"box":{"x":70,"y":521,"width":818,"height":11}},{"id":"a00bede0-3894-423f-afc6-60dca0052c8d","block_type":"box","text":"expands financial statement disclosure requirements relating to fair value measurements.","page_number":155,"box":{"x":69,"y":536,"width":641,"height":11}},{"id":"8983253b-be22-456d-bbd5-a79c8d42b1c9","block_type":"box","text":"Generally, ASC 820 and other accounting rules applicable to funds and various assets in which they invest are","page_number":155,"box":{"x":102,"y":559,"width":786,"height":11}},{"id":"ae5c47ef-7472-4567-848b-2b36be26d110","block_type":"box","text":"evolving. Such changes may adversely affect a Fund. For example, the evolution of rules governing the determination","page_number":155,"box":{"x":69,"y":574,"width":832,"height":11}},{"id":"9c64b8eb-f134-440d-aabb-14de86fb062b","block_type":"box","text":"of the fair market value of assets or liabilities, to the extent such rules become more stringent, would tend to","page_number":155,"box":{"x":69,"y":589,"width":780,"height":11}},{"id":"f0a6fdb2-1e22-4267-894c-b2f7add0b6b1","block_type":"box","text":"increase the cost and/or reduce the availability of third-party determinations of fair market value. This may in turn","page_number":155,"box":{"x":70,"y":604,"width":810,"height":11}},{"id":"1637e529-7e21-4037-86e8-8ed6b03af879","block_type":"box","text":"increase the costs associated with selling assets or affect their liquidity due to a Fund’s inability to obtain a third","page_number":155,"box":{"x":70,"y":619,"width":810,"height":11}},{"id":"5b4c2955-8304-44f1-92bc-333d9c471eb3","block_type":"box","text":"party determination of fair market value.","page_number":155,"box":{"x":70,"y":634,"width":285,"height":11}},{"id":"d2174960-1415-4e00-802e-977e4591dc4e","block_type":"box","text":"Computation of Offering Price Per Share","page_number":155,"box":{"x":69,"y":665,"width":292,"height":11}},{"id":"e151726e-f9ed-4653-a15f-d475c6523c42","block_type":"box","text":"See “Computation of Offering Price Per Share” in Part I of a Fund’s SAI for an illustration of the computation of","page_number":155,"box":{"x":102,"y":687,"width":791,"height":11}},{"id":"5cdc9443-357f-4137-ac50-3489fda23b33","block_type":"box","text":"the offering price for shares of your Fund.","page_number":155,"box":{"x":68,"y":702,"width":295,"height":12}},{"id":"1eab8cfa-0001-44c0-948f-b9f3aa0b2cb8","block_type":"box","text":"PORTFOLIO TRANSACTIONS AND BROKERAGE","page_number":155,"box":{"x":303,"y":732,"width":373,"height":10}},{"id":"5e2af2b7-6187-4dfd-a9c0-ebf9e620726a","block_type":"box","text":"Transactions in Portfolio Securities","page_number":155,"box":{"x":68,"y":762,"width":257,"height":9}},{"id":"f829b2fc-f81a-4313-8816-87e695af537e","block_type":"box","text":"Subject to policies established by the Board of Directors, BlackRock is primarily responsible for the execution of","page_number":155,"box":{"x":102,"y":785,"width":798,"height":11}},{"id":"83b87f83-3cd9-431e-a916-8f67724e748b","block_type":"box","text":"a Fund’s portfolio transactions and the allocation of brokerage. BlackRock does not execute transactions through any","page_number":155,"box":{"x":69,"y":800,"width":839,"height":11}},{"id":"01a8f692-516f-4486-b671-6c7105ffec78","block_type":"box","text":"particular broker or dealer, but seeks to obtain the best net results for the Fund, taking into account certain factors","page_number":155,"box":{"x":70,"y":815,"width":822,"height":11}},{"id":"43be8489-14cb-4e58-81f7-1c0ce26170f1","block_type":"box","text":"set out below. While BlackRock generally seeks reasonable trade execution costs, a Fund does not necessarily pay","page_number":155,"box":{"x":69,"y":830,"width":820,"height":11}},{"id":"b2700148-f82e-4df9-a07d-07cba8a0debe","block_type":"box","text":"the lowest spread or commission available, and payment of the lowest commission or spread is not necessarily","page_number":155,"box":{"x":68,"y":845,"width":798,"height":11}},{"id":"463f3ce5-e54d-44cf-be25-28977ae01174","block_type":"box","text":"consistent with obtaining the best price and execution in particular transactions. Subject to applicable legal","page_number":155,"box":{"x":69,"y":860,"width":765,"height":12}},{"id":"5cd50d02-1502-4d6c-bdbb-cfd286742052","block_type":"box","text":"requirements, BlackRock may select a broker based partly upon brokerage or research services provided to","page_number":155,"box":{"x":69,"y":876,"width":768,"height":11}},{"id":"9c07c2d2-efc6-4950-93f6-a9f00559b955","block_type":"box","text":"BlackRock and its clients, including a Fund. In return for such services, BlackRock may cause a Fund to pay a higher","page_number":155,"box":{"x":70,"y":891,"width":830,"height":11}},{"id":"1c72d922-11c6-49b4-bcc3-74aef424feeb","block_type":"box","text":"II-124","page_number":155,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"9ab86beb-cc58-494e-bb11-0451ddf1843f","block_type":"box","text":"NM0926U-5977317-155/232","page_number":155,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"75dff0c3-8107-4001-894f-0489fb15220b","block_type":"box","text":"commission than other brokers would charge if BlackRock determines in good faith that the commission is","page_number":156,"box":{"x":69,"y":45,"width":760,"height":11}},{"id":"ce3d4076-50c2-4b0f-945f-620527c48655","block_type":"box","text":"reasonable in relation to the services provided.","page_number":156,"box":{"x":69,"y":60,"width":336,"height":11}},{"id":"8dca2227-333f-42ab-a21a-49ee31b7d2c0","block_type":"box","text":"In the case of Feeder Funds, because each Feeder Fund generally invests exclusively in beneficial interests of a","page_number":156,"box":{"x":102,"y":82,"width":794,"height":12}},{"id":"1c3706fb-0ff0-44a3-8e74-03ea48a0cca1","block_type":"box","text":"Master Portfolio, it is expected that all transactions in portfolio securities will be entered into by the Master Portfolio.","page_number":156,"box":{"x":70,"y":98,"width":835,"height":11}},{"id":"22925730-f9a6-43b7-ae51-656e1418938e","block_type":"box","text":"In selecting brokers or dealers to execute portfolio transactions, the Manager and sub-advisers seek to obtain","page_number":156,"box":{"x":102,"y":120,"width":784,"height":12}},{"id":"49d553e3-713c-48d2-9300-805a0a29e83d","block_type":"box","text":"the best price and most favorable execution for a Fund, taking into account a variety of factors including: (i) the size,","page_number":156,"box":{"x":68,"y":135,"width":829,"height":12}},{"id":"503e7adf-8af2-4fce-9fd9-f8dd05eae665","block_type":"box","text":"nature and character of the security or instrument being traded and the markets in which it is purchased or sold;","page_number":156,"box":{"x":69,"y":150,"width":802,"height":12}},{"id":"dabf083c-2696-4690-918c-526c46c6c05f","block_type":"box","text":"(ii) the desired timing of the transaction; (iii) BlackRock’s knowledge of the expected commission rates and spreads","page_number":156,"box":{"x":69,"y":166,"width":826,"height":11}},{"id":"b06e11db-5c25-41eb-a0f5-a92e9b8a0d14","block_type":"box","text":"currently available; (iv) the activity existing and expected in the market for the particular security or instrument,","page_number":156,"box":{"x":69,"y":181,"width":789,"height":11}},{"id":"4838d01b-1c6d-45c4-9628-a1375bd172f7","block_type":"box","text":"including any anticipated execution difficulties; (v) the full range of brokerage services provided; (vi) the broker’s or","page_number":156,"box":{"x":70,"y":196,"width":818,"height":11}},{"id":"a97c5262-af13-41dd-8450-993c7bd40b11","block_type":"box","text":"dealer’s capital; (vii) the quality of research and research services provided; (viii) the reasonableness of the","page_number":156,"box":{"x":69,"y":211,"width":769,"height":11}},{"id":"cc23e8f6-a660-42e9-abe3-0c4d4094bbea","block_type":"box","text":"commission, dealer spread or its equivalent for the specific transaction; and (ix) BlackRock’s knowledge of any actual","page_number":156,"box":{"x":69,"y":226,"width":837,"height":11}},{"id":"d5b727b6-5864-4e98-a185-6a5bf989e2ca","block_type":"box","text":"or apparent operational problems of a broker or dealer.","page_number":156,"box":{"x":69,"y":241,"width":391,"height":11}},{"id":"0bfdc74c-ec7c-467d-bd5e-9dc0e8355dea","block_type":"box","text":"Section 28(e) of the Exchange Act (“Section 28(e)”) permits an investment adviser, under certain circumstances","page_number":156,"box":{"x":102,"y":264,"width":801,"height":11}},{"id":"1d56c271-3ecb-4e4a-bf01-e30583c6832a","block_type":"box","text":"to cause an account to pay a broker or dealer a commission for effecting a transaction that exceeds the amount","page_number":156,"box":{"x":68,"y":279,"width":802,"height":11}},{"id":"6ad3b55a-21bb-4546-9152-d5a60f53ab06","block_type":"box","text":"another broker or dealer would have charged for effecting the same transaction in recognition of the value of","page_number":156,"box":{"x":69,"y":294,"width":775,"height":11}},{"id":"53331b3b-8b09-41c9-a260-7c1e5d3b45b2","block_type":"box","text":"brokerage and research services provided by that broker or dealer. This includes commissions paid on riskless","page_number":156,"box":{"x":69,"y":309,"width":790,"height":11}},{"id":"451cca0e-e7c3-4f62-8162-1661e6f2cc1c","block_type":"box","text":"principal transactions under certain conditions. Brokerage and research services include: (1) furnishing advice as to","page_number":156,"box":{"x":70,"y":324,"width":827,"height":12}},{"id":"7f02d461-c841-4179-b43a-a80308d654b9","block_type":"box","text":"the value of securities, including pricing and appraisal advice, credit analysis, risk measurement analysis,","page_number":156,"box":{"x":68,"y":339,"width":753,"height":12}},{"id":"5ca9b22f-8be4-4f70-b981-23fd1ad00ac6","block_type":"box","text":"performance and other analysis, as well as the advisability of investing in, purchasing or selling securities, and the","page_number":156,"box":{"x":70,"y":355,"width":818,"height":11}},{"id":"3339fea4-b8cf-4d8d-82b9-0c5651fe2ea9","block_type":"box","text":"availability of securities or purchasers or sellers of securities; (2) furnishing analyses and reports concerning issuers,","page_number":156,"box":{"x":69,"y":370,"width":837,"height":11}},{"id":"ce0ba7f0-be53-41e2-b5bb-5cc43caadee5","block_type":"box","text":"industries, securities, economic factors and trends, portfolio strategy, and the performance of accounts; and","page_number":156,"box":{"x":70,"y":385,"width":775,"height":11}},{"id":"5d5b3715-95a7-440c-9a72-f9c4eb053695","block_type":"box","text":"(3) effecting securities transactions and performing functions incidental to securities transactions (such as","page_number":156,"box":{"x":69,"y":400,"width":764,"height":11}},{"id":"8f5928f9-74b9-426d-a503-5b26620e61c2","block_type":"box","text":"clearance, settlement, and custody). BlackRock believes that access to independent investment research is","page_number":156,"box":{"x":69,"y":415,"width":770,"height":11}},{"id":"678f2d94-3a57-43e5-b13b-163f9bedc875","block_type":"box","text":"beneficial to its investment decision-making processes and, therefore, to the Funds.","page_number":156,"box":{"x":69,"y":430,"width":599,"height":11}},{"id":"fb7967ad-a287-4178-8c69-5a2d7f629195","block_type":"box","text":"BlackRock, unless prohibited by applicable law, may participate in client commission arrangements under which","page_number":156,"box":{"x":102,"y":453,"width":796,"height":11}},{"id":"74fcc698-c34f-4d3a-8083-bc40071ac0a9","block_type":"box","text":"BlackRock may execute transactions through a broker-dealer and request that the broker-dealer allocate a portion of","page_number":156,"box":{"x":70,"y":468,"width":829,"height":11}},{"id":"9b79d4d1-9067-48ca-935c-40c0718ef488","block_type":"box","text":"the commissions or commission credits to another firm that provides research to BlackRock. BlackRock believes that","page_number":156,"box":{"x":68,"y":483,"width":839,"height":11}},{"id":"65e12ad6-fbde-43bd-8d1a-afb0126e53a9","block_type":"box","text":"research services obtained through soft dollar or commission sharing arrangements enhance its investment decision","page_number":156,"box":{"x":69,"y":498,"width":839,"height":11}},{"id":"a1a958a3-7a45-4a2d-affe-3fc7ed6ac2c7","block_type":"box","text":"making capabilities, thereby increasing the prospects for higher investment returns. BlackRock will engage only in","page_number":156,"box":{"x":69,"y":513,"width":809,"height":12}},{"id":"3958cedc-9ae1-49c1-8685-1b8e5ba6bd1f","block_type":"box","text":"soft dollar or commission sharing transactions that comply with the requirements of Section 28(e). Certain Funds","page_number":156,"box":{"x":69,"y":528,"width":808,"height":12}},{"id":"b32f189e-1b79-486f-9768-5f9bb2e9d0e7","block_type":"box","text":"may be subject to additional regulations, including MiFID II. Under MiFID II, EU investment managers, including BIL,","page_number":156,"box":{"x":69,"y":544,"width":818,"height":11}},{"id":"2ef0a163-c2f9-47b0-b705-cea56e7fa3fe","block_type":"box","text":"pay for any research out of their own resources and not through soft dollars or commission sharing arrangements.","page_number":156,"box":{"x":70,"y":559,"width":813,"height":11}},{"id":"133971f5-3521-4d62-a15c-f90c6dfa8e15","block_type":"box","text":"BlackRock regularly evaluates the soft dollar products and services utilized, as well as the overall soft dollar and","page_number":156,"box":{"x":70,"y":574,"width":801,"height":11}},{"id":"6e305672-5525-4ea8-a9d6-86cdbab29fa9","block_type":"box","text":"commission sharing arrangements to ensure that trades are executed by firms that are regarded as best able to","page_number":156,"box":{"x":69,"y":589,"width":802,"height":11}},{"id":"e797be84-4f57-44e4-bebd-e1a034962544","block_type":"box","text":"execute trades for client accounts, while at the same time providing access to the research and other services","page_number":156,"box":{"x":69,"y":604,"width":790,"height":11}},{"id":"0dba8a64-5baf-4270-b1da-9e24c68098f0","block_type":"box","text":"BlackRock views as impactful to its trading results.","page_number":156,"box":{"x":70,"y":619,"width":361,"height":11}},{"id":"60c671e5-3f10-4bae-8ea9-5bafb2055fbb","block_type":"box","text":"BlackRock, unless prohibited by applicable law, may utilize soft dollars and related services, including research","page_number":156,"box":{"x":102,"y":642,"width":791,"height":11}},{"id":"a2d643ea-0765-4911-86c0-4595dca5a057","block_type":"box","text":"(whether prepared by the broker-dealer or prepared by a third-party and provided to BlackRock by the broker-dealer)","page_number":156,"box":{"x":69,"y":657,"width":819,"height":11}},{"id":"f1b7e8aa-e831-4125-bd51-dbb1b84e8c28","block_type":"box","text":"and execution or brokerage services within applicable rules and BlackRock’s policies to the extent that such","page_number":156,"box":{"x":69,"y":672,"width":772,"height":11}},{"id":"104c1037-01f6-4c7c-babc-142375129982","block_type":"box","text":"permitted services do not compromise BlackRock’s ability to seek to obtain best execution. In this regard, the","page_number":156,"box":{"x":70,"y":687,"width":785,"height":11}},{"id":"0bfb4936-86a5-42ce-91f4-c91a0575b35c","block_type":"box","text":"portfolio management investment and/or trading teams may consider a variety of factors, including the degree to","page_number":156,"box":{"x":70,"y":702,"width":806,"height":12}},{"id":"3e374faf-e6d1-40cb-b7b0-0a9938103c8b","block_type":"box","text":"which the broker-dealer: (a) provides access to company management; (b) provides access to their analysts;","page_number":156,"box":{"x":68,"y":718,"width":772,"height":11}},{"id":"35f51585-4dc8-44b2-b1fb-1a7414378100","block_type":"box","text":"(c) provides meaningful/insightful research notes on companies or other potential investments; (d) facilitates calls on","page_number":156,"box":{"x":69,"y":732,"width":838,"height":12}},{"id":"aceb8933-393e-4f76-b170-54a92f8268e5","block_type":"box","text":"which meaningful or insightful ideas about companies or potential investments are discussed; (e) facilitates","page_number":156,"box":{"x":68,"y":748,"width":769,"height":11}},{"id":"b21e560b-e7d6-4075-bbb6-ae359296cccc","block_type":"box","text":"conferences at which meaningful or insightful ideas about companies or potential investments are discussed; or","page_number":156,"box":{"x":69,"y":763,"width":801,"height":11}},{"id":"a1eb6dbd-1f3f-49be-9524-ff8ac63757bd","block_type":"box","text":"(f) provides research tools such as market data, financial analysis, and other third-party related research and","page_number":156,"box":{"x":69,"y":778,"width":778,"height":11}},{"id":"dc0b3907-30de-4781-8c57-51252ed249a7","block_type":"box","text":"brokerage tools that aid in the investment process.","page_number":156,"box":{"x":69,"y":793,"width":363,"height":11}},{"id":"f551d618-1cf5-488c-8a2a-8e684a65d10c","block_type":"box","text":"Research-oriented services for which BlackRock, unless prohibited by applicable law, might pay with Fund","page_number":156,"box":{"x":102,"y":816,"width":749,"height":11}},{"id":"eb432445-ec6c-4764-bbba-c7e1b0db6eed","block_type":"box","text":"commissions may be in written form or through direct contact with individuals and may include information as to","page_number":156,"box":{"x":69,"y":831,"width":799,"height":11}},{"id":"94b176fc-8af7-4f54-9746-070078349278","block_type":"box","text":"particular companies or industries and securities or groups of securities, as well as market, economic, or","page_number":156,"box":{"x":70,"y":846,"width":752,"height":11}},{"id":"64f9fa52-6990-4e76-aaf5-ff31f3145030","block_type":"box","text":"institutional advice and statistical information, political developments and technical market information that assists","page_number":156,"box":{"x":70,"y":861,"width":823,"height":11}},{"id":"5afd5c93-d232-4c08-8cbc-c8159fa10eaf","block_type":"box","text":"in the valuation of investments. Except as noted immediately below, research services furnished by brokers may be","page_number":156,"box":{"x":70,"y":876,"width":822,"height":11}},{"id":"7920ac8f-0b92-47b2-a3a3-63208cfc03c7","block_type":"box","text":"used in servicing some or all client accounts and not all services may be used in connection with the Fund or account","page_number":156,"box":{"x":69,"y":891,"width":840,"height":12}},{"id":"2b08bad3-2086-4f1a-af48-1518381a73ed","block_type":"box","text":"that paid commissions to the broker providing such services. In some cases, research information received from","page_number":156,"box":{"x":68,"y":906,"width":805,"height":12}},{"id":"dce8fe59-a0d1-4805-9c72-fe3de54617f4","block_type":"box","text":"II-125","page_number":156,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"be078f58-01f9-4bc9-9d08-997479ac0e36","block_type":"box","text":"NM0926U-5977317-156/232","page_number":156,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"62da33a5-cbb3-4c93-ad3d-87c4a4463e3e","block_type":"box","text":"brokers by mutual fund management personnel, or personnel principally responsible for BlackRock’s individually","page_number":157,"box":{"x":69,"y":45,"width":798,"height":11}},{"id":"360cbb48-1b83-4b4e-b784-64bea35db0e2","block_type":"box","text":"managed portfolios, is not necessarily shared by and between such personnel. Any investment advisory or other fees","page_number":157,"box":{"x":69,"y":60,"width":836,"height":11}},{"id":"e7ffe18a-0301-44ca-8460-ed5cbb7c1744","block_type":"box","text":"paid by a Fund to BlackRock are not reduced as a result of BlackRock’s receipt of research services. In some cases,","page_number":157,"box":{"x":70,"y":75,"width":832,"height":11}},{"id":"cd280902-210a-4da3-b9d0-92a41f9e4b2f","block_type":"box","text":"BlackRock may receive a service from a broker that has both a “research” and a “non-research” use. When this","page_number":157,"box":{"x":70,"y":90,"width":798,"height":11}},{"id":"172dd5c5-3bc9-4159-bf89-0e63c219c7cf","block_type":"box","text":"occurs BlackRock makes a good faith allocation, under all the circumstances, between the research and non","page_number":157,"box":{"x":69,"y":105,"width":780,"height":11}},{"id":"9d3fc632-c0a3-4485-92b8-033b9f932510","block_type":"box","text":"research uses of the service. The percentage of the service that is used for research purposes may be paid for with","page_number":157,"box":{"x":69,"y":120,"width":827,"height":12}},{"id":"781fc199-c335-4628-a4f2-8ab702988c56","block_type":"box","text":"client commissions, while BlackRock will use its own funds to pay for the percentage of the service that is used for","page_number":157,"box":{"x":69,"y":135,"width":821,"height":12}},{"id":"d890bccb-78a5-4dcc-a76b-b78daf0591d5","block_type":"box","text":"non-research purposes. In making this good faith allocation, BlackRock faces a potential conflict of interest, but","page_number":157,"box":{"x":69,"y":150,"width":797,"height":12}},{"id":"ffb0993b-b2e3-4620-8d0b-a56033e49aa4","block_type":"box","text":"BlackRock believes that its allocation procedures are reasonably designed to ensure that it appropriately allocates","page_number":157,"box":{"x":70,"y":166,"width":815,"height":11}},{"id":"554e5388-658d-4004-bac7-94b041b6623b","block_type":"box","text":"the anticipated use of such services to their research and non-research uses.","page_number":157,"box":{"x":68,"y":181,"width":555,"height":11}},{"id":"2d4f4df0-7687-4031-8d29-243dbdf81b3c","block_type":"box","text":"Under MiFID II, investment managers in the EU, including BIL, are not able to use soft dollars to pay for research","page_number":157,"box":{"x":102,"y":203,"width":802,"height":12}},{"id":"55be69f1-b5b6-4e6a-91a2-d01e91e7ef6e","block_type":"box","text":"from brokers. Investment managers in the EU are required to either pay for research out of their own profit and loss","page_number":157,"box":{"x":68,"y":218,"width":825,"height":12}},{"id":"1fb6944c-2eaa-47cc-ae65-d24852837abc","block_type":"box","text":"or agree with clients to have research costs paid by clients through research payment accounts that are directly","page_number":157,"box":{"x":69,"y":234,"width":798,"height":11}},{"id":"8e5d2b80-f29c-4c8d-88db-d04a89910809","block_type":"box","text":"funded or funded by a specific client research charge collected alongside execution commissions, provided that the","page_number":157,"box":{"x":68,"y":249,"width":824,"height":11}},{"id":"00e16da6-6c80-49fd-af06-560d9cf04a00","block_type":"box","text":"payments for research are unbundled from the payments for execution. BIL will pay for any research out of its own","page_number":157,"box":{"x":70,"y":264,"width":812,"height":11}},{"id":"4f952d1f-c700-4bb6-ba2f-c11af9e68a0b","block_type":"box","text":"resources and not through soft dollars or commission sharing arrangements.","page_number":157,"box":{"x":69,"y":279,"width":547,"height":11}},{"id":"a2d19a4b-fb0a-464f-a201-35494413ff59","block_type":"box","text":"Payments of commissions to brokers who are affiliated persons of the Fund, or the Master Portfolio with respect","page_number":157,"box":{"x":102,"y":302,"width":804,"height":11}},{"id":"c60cf82a-70c7-4a15-9c23-5bdeb6e9ff49","block_type":"box","text":"to the Feeder Fund (or affiliated persons of such persons), will be made in accordance with Rule 17e-1 under the","page_number":157,"box":{"x":68,"y":317,"width":806,"height":11}},{"id":"0a95d621-2a0b-4ce5-9545-81d651f30014","block_type":"box","text":"Investment Company Act. Subject to policies established by the Board of Directors of the Master Portfolio, BlackRock","page_number":157,"box":{"x":70,"y":332,"width":836,"height":11}},{"id":"f3daa804-04c8-4b97-8fcf-b6c0ce081d93","block_type":"box","text":"is primarily responsible for the execution of the Master Portfolio’s portfolio transactions and the allocation of","page_number":157,"box":{"x":70,"y":347,"width":777,"height":11}},{"id":"cebf4c4a-9239-4a54-9b16-d5eebf672186","block_type":"box","text":"brokerage.","page_number":157,"box":{"x":69,"y":362,"width":74,"height":11}},{"id":"da2c1ab2-57af-4452-8aaf-10dad91490d7","block_type":"box","text":"From time to time, a Fund may purchase new issues of securities in a fixed price offering. In these situations,","page_number":157,"box":{"x":102,"y":385,"width":781,"height":11}},{"id":"c8e5adee-f21a-43d1-ba03-6c185a596ac2","block_type":"box","text":"the broker may be a member of the selling group that will, in addition to selling securities, provide BlackRock with","page_number":157,"box":{"x":68,"y":400,"width":810,"height":11}},{"id":"d865ced1-fb51-41ab-a220-27fe27c2a6ea","block_type":"box","text":"research services. FINRA has adopted rules expressly permitting these types of arrangements under certain","page_number":157,"box":{"x":69,"y":415,"width":771,"height":11}},{"id":"80372818-0fe9-4ffd-a8d4-a4e4f830ddca","block_type":"box","text":"circumstances. Generally, the broker will provide research “credits” in these situations at a rate that is higher than","page_number":157,"box":{"x":69,"y":430,"width":818,"height":11}},{"id":"e3e68590-3758-4322-8e07-cf1592da2782","block_type":"box","text":"that available for typical secondary market transactions. These arrangements may not fall within the safe harbor of","page_number":157,"box":{"x":68,"y":445,"width":821,"height":12}},{"id":"27d128a0-8f05-49b9-bc48-64f1b8fc30f7","block_type":"box","text":"Section 28(e).","page_number":157,"box":{"x":69,"y":460,"width":99,"height":11}},{"id":"98703605-a03b-42d0-af99-d203de8e5dd9","block_type":"box","text":"BlackRock does not consider sales of shares of the mutual funds it advises as a factor in the selection of","page_number":157,"box":{"x":102,"y":483,"width":755,"height":9}},{"id":"ac8652fb-9056-4dda-8089-7d34326073b4","block_type":"box","text":"brokers or dealers to execute portfolio transactions for a Fund; however, whether or not a particular broker or dealer","page_number":157,"box":{"x":69,"y":498,"width":828,"height":11}},{"id":"6d79323e-5ae6-47fb-8a67-96ad85a2e94c","block_type":"box","text":"sells shares of the mutual funds advised by BlackRock neither qualifies nor disqualifies such broker or dealer to","page_number":157,"box":{"x":69,"y":513,"width":799,"height":11}},{"id":"6bafc643-1fa5-44fe-9878-cd6e68eeda9f","block_type":"box","text":"execute transactions for those mutual funds.","page_number":157,"box":{"x":69,"y":528,"width":319,"height":9}},{"id":"9b3447fa-c6c0-463e-82a8-414fe366a0d6","block_type":"box","text":"Each Fund anticipates that its brokerage transactions involving foreign securities generally will be conducted","page_number":157,"box":{"x":102,"y":551,"width":770,"height":11}},{"id":"4bfe2597-a99f-47b4-8e53-62e2266f98bb","block_type":"box","text":"primarily on the principal stock exchanges of the applicable country. Foreign equity securities may be held by a Fund","page_number":157,"box":{"x":70,"y":566,"width":825,"height":11}},{"id":"bce4ae67-7b5a-4a86-9b17-583dd9e9059e","block_type":"box","text":"in the form of depositary receipts, or other securities convertible into foreign equity securities. Depositary receipts","page_number":157,"box":{"x":70,"y":581,"width":816,"height":12}},{"id":"f704e3b9-f7a6-4ffd-9808-ba0c3deb96c2","block_type":"box","text":"may be listed on stock exchanges, or traded in OTC markets in the United States or Europe, as the case may be.","page_number":157,"box":{"x":69,"y":597,"width":805,"height":11}},{"id":"fb48b186-9fb6-400c-99a7-950e92de5e0e","block_type":"box","text":"American Depositary Receipts, like other securities traded in the United States, will be subject to negotiated","page_number":157,"box":{"x":68,"y":612,"width":773,"height":11}},{"id":"60fb5f06-5309-4767-8aaf-9859f5831d88","block_type":"box","text":"commission rates. Because the shares of each Fund are redeemable on a daily basis in U.S. dollars, each Fund","page_number":157,"box":{"x":69,"y":627,"width":798,"height":11}},{"id":"ee5b164a-1d7a-4d55-b477-a29b7a42849e","block_type":"box","text":"intends to manage its portfolio so as to give reasonable assurance that it will be able to obtain U.S. dollars to the","page_number":157,"box":{"x":70,"y":642,"width":812,"height":11}},{"id":"0a95ee6c-c9bf-4f23-bf13-0b7801f3888e","block_type":"box","text":"extent necessary to meet anticipated redemptions. Under present conditions, it is not believed that these","page_number":157,"box":{"x":69,"y":657,"width":754,"height":11}},{"id":"4c016a4a-b6f5-4d03-a2c3-39f5ca29a494","block_type":"box","text":"considerations will have a significant effect on a Fund’s portfolio strategies.","page_number":157,"box":{"x":69,"y":672,"width":540,"height":11}},{"id":"1ef5b855-79d0-4f35-a8a1-99c2988497a2","block_type":"box","text":"See “Portfolio Transactions and Brokerage” in the SAI for information about the brokerage commissions paid by","page_number":157,"box":{"x":102,"y":695,"width":798,"height":11}},{"id":"e53b9bcf-e0d1-4c2b-8f93-c0a6e72397a9","block_type":"box","text":"your Fund, including commissions paid to affiliates, if any, for the periods indicated.","page_number":157,"box":{"x":68,"y":710,"width":597,"height":11}},{"id":"e1a9e2c7-1618-4022-8d72-1fdcadb7432d","block_type":"box","text":"Each Fund may invest in certain securities traded in the OTC market and intends to deal directly with the dealers","page_number":157,"box":{"x":102,"y":733,"width":802,"height":11}},{"id":"85cb2ec0-a740-43c9-8ac7-fe33cc1bd3b5","block_type":"box","text":"who make a market in the particular securities, except in those circumstances in which better prices and execution","page_number":157,"box":{"x":68,"y":748,"width":822,"height":11}},{"id":"bd07229a-856d-4e25-bcfc-965c52816883","block_type":"box","text":"are available elsewhere. Under the Investment Company Act, persons affiliated with a Fund and persons who are","page_number":157,"box":{"x":69,"y":763,"width":804,"height":11}},{"id":"699cd447-b262-46b0-a5a9-dd2ce9ab329e","block_type":"box","text":"affiliated with such affiliated persons are prohibited from dealing with the Fund as principal in the purchase and sale","page_number":157,"box":{"x":69,"y":778,"width":832,"height":11}},{"id":"0933de82-d091-40c4-9984-95f03a721021","block_type":"box","text":"of securities unless a permissive order allowing such transactions is obtained from the Commission. Since","page_number":157,"box":{"x":69,"y":793,"width":762,"height":11}},{"id":"72985e5c-862f-42f3-9ab3-9c8f8c8a5550","block_type":"box","text":"transactions in the OTC market usually involve transactions with the dealers acting as principal for their own","page_number":157,"box":{"x":68,"y":808,"width":770,"height":11}},{"id":"51226a80-64a1-4df7-ac61-9a418b2f2012","block_type":"box","text":"accounts, the Funds will not deal with affiliated persons in connection with such transactions. However, an affiliated","page_number":157,"box":{"x":69,"y":823,"width":828,"height":11}},{"id":"aded4b81-2826-42a0-9165-e6facf7b4fd5","block_type":"box","text":"person of a Fund may serve as its broker in OTC transactions conducted on an agency basis provided that, among","page_number":157,"box":{"x":70,"y":838,"width":814,"height":12}},{"id":"f7290565-65eb-4021-941f-5429a730d0c6","block_type":"box","text":"other things, the fee or commission received by such affiliated broker is reasonable and fair compared to the fee or","page_number":157,"box":{"x":69,"y":853,"width":825,"height":12}},{"id":"419c5e76-99e1-4abb-b919-e84c07f7f1f7","block_type":"box","text":"commission received by non-affiliated brokers in connection with comparable transactions.","page_number":157,"box":{"x":69,"y":869,"width":645,"height":11}},{"id":"03859e41-abc2-49a6-9cf0-9eb2d2e66bd2","block_type":"box","text":"OTC issues, including most fixed-income securities such as corporate debt and U.S. Government Securities, are","page_number":157,"box":{"x":102,"y":891,"width":797,"height":12}},{"id":"dcb7003f-28ff-48df-9cfd-448bdaaa0902","block_type":"box","text":"normally traded on a “net” basis without a stated commission, through dealers acting for their own account and not","page_number":157,"box":{"x":69,"y":906,"width":826,"height":12}},{"id":"3d0815b2-3342-4f5e-8714-5967e37f0dee","block_type":"box","text":"II-126","page_number":157,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"d7ae7a84-2b66-434a-b062-a3f2e69254bd","block_type":"box","text":"NM0926U-5977317-157/232","page_number":157,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"1fdb7aa3-e5c4-4c4d-b3fb-5e9f271d4d32","block_type":"box","text":"as brokers. The Funds will primarily engage in transactions with these dealers or deal directly with the issuer unless a","page_number":158,"box":{"x":69,"y":45,"width":839,"height":11}},{"id":"c1935446-fded-4f61-8507-0981df4257df","block_type":"box","text":"better price or execution could be obtained by using a broker. Prices paid to a dealer with respect to both foreign and","page_number":158,"box":{"x":69,"y":60,"width":833,"height":11}},{"id":"a0fab04f-f319-48fa-8b85-08d2a7a90b1f","block_type":"box","text":"domestic securities will generally include a “spread,” which is the difference between the prices at which the dealer","page_number":158,"box":{"x":69,"y":75,"width":826,"height":11}},{"id":"fc4fe8e0-ad33-4075-98fa-c513edcdab81","block_type":"box","text":"is willing to purchase and sell the specific security at the time, and includes the dealer’s normal profit.","page_number":158,"box":{"x":70,"y":90,"width":730,"height":11}},{"id":"40c13b68-f55d-48f1-96cf-d0379ca7a7d7","block_type":"box","text":"Purchases of money market instruments by a Fund are made from dealers, underwriters and issuers. The Funds","page_number":158,"box":{"x":102,"y":113,"width":800,"height":11}},{"id":"f7e95d42-bf02-4f65-8428-b52abbdca017","block_type":"box","text":"do not currently expect to incur any brokerage commission expense on such transactions because money market","page_number":158,"box":{"x":69,"y":128,"width":807,"height":11}},{"id":"6d278047-4c51-4055-8c06-fad43a9e153c","block_type":"box","text":"instruments are generally traded on a “net” basis with dealers acting as principal for their own accounts without a","page_number":158,"box":{"x":70,"y":143,"width":812,"height":11}},{"id":"8c99d183-23d9-486a-a330-2a5aac9bbf53","block_type":"box","text":"stated commission. The price of the security, however, usually includes a profit to the dealer. Each money market","page_number":158,"box":{"x":69,"y":158,"width":807,"height":11}},{"id":"4fa75bcc-d3bd-426c-b5e3-e5122eb2a83f","block_type":"box","text":"fund intends to purchase only securities with remaining maturities of 397 days or less as determined in accordance","page_number":158,"box":{"x":68,"y":173,"width":827,"height":11}},{"id":"18c8bf08-0d66-40f5-a532-9c7381229e75","block_type":"box","text":"with the rules of the Commission. As a result, the portfolio turnover rates of a money market fund will be relatively","page_number":158,"box":{"x":68,"y":188,"width":817,"height":11}},{"id":"4e3553d8-ae6d-41e9-8473-4a2116ddd232","block_type":"box","text":"high. However, because brokerage commissions will not normally be paid with respect to investments made by a","page_number":158,"box":{"x":69,"y":204,"width":802,"height":11}},{"id":"e8fa37d9-8477-4013-8cf9-830c71c4d375","block_type":"box","text":"money market fund, the turnover rates should not adversely affect the Fund’s NAVs or net income.","page_number":158,"box":{"x":69,"y":218,"width":700,"height":12}},{"id":"dec44dcb-ab2e-46ae-bd38-6a454c1855ba","block_type":"box","text":"Securities purchased in underwritten offerings include a fixed amount of compensation to the underwriter,","page_number":158,"box":{"x":102,"y":241,"width":756,"height":11}},{"id":"ad6cf937-91a9-4a4f-bec3-6304803ad102","block_type":"box","text":"generally referred to as the underwriter’s concession or discount. When offered securities are purchased or sold","page_number":158,"box":{"x":68,"y":256,"width":804,"height":12}},{"id":"d74ad01d-2723-4184-8a8f-215156f3a1cd","block_type":"box","text":"directly from or to an issuer, no commissions or discounts are paid except where required by local markets.","page_number":158,"box":{"x":69,"y":271,"width":766,"height":12}},{"id":"2e729ed4-c93c-4f61-8f91-3d7d21f2f98f","block_type":"box","text":"The Manager or sub-advisers may seek to obtain an undertaking from issuers of commercial paper or dealers","page_number":158,"box":{"x":101,"y":294,"width":780,"height":11}},{"id":"472f6fe5-4b31-4ce6-98d2-29cde940f036","block_type":"box","text":"selling commercial paper to consider the repurchase of such securities from a Fund prior to maturity at their original","page_number":158,"box":{"x":69,"y":309,"width":826,"height":11}},{"id":"23f01f82-ac65-4173-a2a1-e4d978d83acf","block_type":"box","text":"cost plus interest (sometimes adjusted to reflect the actual maturity of the securities), if it believes that a Fund’s","page_number":158,"box":{"x":69,"y":324,"width":806,"height":11}},{"id":"d4c1c3a6-76ee-4776-86f4-67987141170b","block_type":"box","text":"anticipated need for liquidity makes such action desirable. Any such repurchase prior to maturity reduces the","page_number":158,"box":{"x":69,"y":339,"width":776,"height":12}},{"id":"5b549ee0-e1de-48aa-bd21-1972a70bc2e0","block_type":"box","text":"possibility that a Fund would incur a capital loss in liquidating commercial paper, especially if interest rates have","page_number":158,"box":{"x":70,"y":355,"width":800,"height":11}},{"id":"8e377ea3-dce0-42cb-808f-a53523aca4cf","block_type":"box","text":"risen since acquisition of such commercial paper.","page_number":158,"box":{"x":69,"y":370,"width":352,"height":11}},{"id":"79b97dd9-f847-49ee-b612-68df77178488","block_type":"box","text":"Investment decisions for each Fund and for other investment accounts managed by the Manager or sub-advisers","page_number":158,"box":{"x":102,"y":392,"width":800,"height":12}},{"id":"fd62c7d3-7c88-4f51-bd36-efbe086f9607","block_type":"box","text":"are made independently of each other in light of differing conditions. BlackRock allocates investments among client","page_number":158,"box":{"x":69,"y":407,"width":824,"height":12}},{"id":"b57258b2-23cd-408a-b12e-f689964222e3","block_type":"box","text":"accounts in a fair and equitable manner over time. A variety of factors will be considered in making such allocations.","page_number":158,"box":{"x":69,"y":423,"width":828,"height":11}},{"id":"cba9d8f0-c3a8-4aee-bbab-1edce86c06a0","block_type":"box","text":"These factors include: (i) investment objectives or strategies for particular accounts, including sector, industry,","page_number":158,"box":{"x":68,"y":438,"width":788,"height":11}},{"id":"8d6db79d-8497-4dac-8861-5db746d01917","block_type":"box","text":"country or region and capitalization weightings, (ii) tax considerations of an account, (iii) risk or investment","page_number":158,"box":{"x":69,"y":453,"width":759,"height":11}},{"id":"3c61fc29-3370-488a-ad09-fabdf42c88fd","block_type":"box","text":"concentration parameters for an account, (iv) supply or demand for a security at a given price level, (v) size of","page_number":158,"box":{"x":69,"y":468,"width":780,"height":11}},{"id":"0c23bdb9-f032-4fa2-bae7-2ae60069b976","block_type":"box","text":"available investment, (vi) cash availability and liquidity requirements for accounts, (vii) regulatory restrictions,","page_number":158,"box":{"x":69,"y":483,"width":777,"height":11}},{"id":"17e70fbe-8505-42d6-af77-b471e4ea2a6e","block_type":"box","text":"(viii) minimum investment size of an account, (ix) relative size of account, and (x) such other factors as may be","page_number":158,"box":{"x":69,"y":498,"width":788,"height":11}},{"id":"98029ee4-0450-45f7-a640-63ecffb6a40f","block_type":"box","text":"approved by BlackRock’s general counsel. Moreover, investments may not be allocated to one client account over","page_number":158,"box":{"x":69,"y":514,"width":811,"height":11}},{"id":"15725e51-04cf-49b7-92bc-c5f32cde0398","block_type":"box","text":"another based on any of the following considerations: (i) to favor one client account at the expense of another, (ii) to","page_number":158,"box":{"x":69,"y":528,"width":829,"height":12}},{"id":"deea4d43-665e-4066-ba0e-3d6e55f50faa","block_type":"box","text":"generate higher fees paid by one client account over another or to produce greater performance compensation to","page_number":158,"box":{"x":68,"y":543,"width":808,"height":12}},{"id":"8ad09292-670a-49d1-a783-bfa2e0148beb","block_type":"box","text":"BlackRock, (iii) to develop or enhance a relationship with a client or prospective client, (iv) to compensate a client for","page_number":158,"box":{"x":70,"y":559,"width":832,"height":11}},{"id":"552e7cf2-8621-4dbf-9543-c7724fdc7c02","block_type":"box","text":"past services or benefits rendered to BlackRock or to induce future services or benefits to be rendered to BlackRock,","page_number":158,"box":{"x":70,"y":574,"width":836,"height":11}},{"id":"d47280b2-0d2b-40c9-a789-6d85e9202234","block_type":"box","text":"or (v) to manage or equalize investment performance among different client accounts.","page_number":158,"box":{"x":69,"y":589,"width":613,"height":11}},{"id":"8c08a60f-af0b-4b75-b5a8-9703aca598c7","block_type":"box","text":"Equity securities will generally be allocated among client accounts within the same investment mandate on a pro","page_number":158,"box":{"x":102,"y":612,"width":802,"height":11}},{"id":"ef6212c9-c397-4ddf-bf76-ea3b072039ee","block_type":"box","text":"rata basis. All allocations of equity securities will be subject, where relevant, to share minimums established for","page_number":158,"box":{"x":69,"y":627,"width":800,"height":11}},{"id":"63fb0a5e-f48f-48ef-90db-e5211267489a","block_type":"box","text":"accounts and compliance constraints.","page_number":158,"box":{"x":69,"y":642,"width":269,"height":11}},{"id":"99d6fdd8-1f3a-4c66-8cfe-56d2f0a6ef39","block_type":"box","text":"Initial public offerings of securities may be over-subscribed and subsequently trade at a premium in the","page_number":158,"box":{"x":102,"y":664,"width":736,"height":12}},{"id":"9f3d5abc-69ce-41f2-b012-35b8713df3ea","block_type":"box","text":"secondary market. In these situations, the supply of securities available for client accounts is often less than the","page_number":158,"box":{"x":69,"y":680,"width":808,"height":11}},{"id":"52e77d98-8114-4a8b-b601-4cc1657b1e5e","block_type":"box","text":"amount of securities the accounts would otherwise take. In order to allocate these investments fairly and equitably","page_number":158,"box":{"x":69,"y":695,"width":821,"height":11}},{"id":"2d170c35-63e6-42bd-80f9-60fa9e33c1d0","block_type":"box","text":"among client accounts over time, each portfolio manager or a member of his or her respective investment team will","page_number":158,"box":{"x":69,"y":710,"width":823,"height":11}},{"id":"65814238-eb4a-416d-a12e-b808bb523b30","block_type":"box","text":"indicate to BlackRock’s trading desk their level of interest in a particular offering with respect to eligible client","page_number":158,"box":{"x":70,"y":725,"width":783,"height":11}},{"id":"7a785bfc-4ee0-4782-9bd6-3bb55d89bef7","block_type":"box","text":"accounts for which that team is responsible. Initial public offerings of U.S. equity securities will be identified as","page_number":158,"box":{"x":69,"y":740,"width":793,"height":11}},{"id":"822fc1f9-f481-4f1f-a0bf-9d14c085af59","block_type":"box","text":"eligible for particular client accounts that are managed by portfolio teams who have indicated interest in the offering","page_number":158,"box":{"x":69,"y":755,"width":831,"height":11}},{"id":"a14a8f3c-c209-43ad-8b4a-8c2a49b9aba5","block_type":"box","text":"based on market capitalization of the issuer of the security and the investment mandate of the client account and in","page_number":158,"box":{"x":69,"y":770,"width":828,"height":11}},{"id":"9be8ea36-5635-48c0-bbe1-07a83e9afaad","block_type":"box","text":"the case of international equity securities, the country where the offering is taking place and the investment mandate","page_number":158,"box":{"x":68,"y":785,"width":839,"height":12}},{"id":"becb407d-f204-4a39-b7ba-0f03d4945857","block_type":"box","text":"of the client account. Generally, shares received during the initial public offering will be allocated among participating","page_number":158,"box":{"x":69,"y":801,"width":835,"height":11}},{"id":"507c568c-6c85-4614-850e-0a277489b06c","block_type":"box","text":"client accounts within each investment mandate on a pro rata basis. In situations where supply is too limited to be","page_number":158,"box":{"x":69,"y":816,"width":819,"height":11}},{"id":"6145309b-d8c1-4d83-8636-e52bca272c54","block_type":"box","text":"allocated among all accounts for which the investment is eligible, portfolio managers may rotate such investment","page_number":158,"box":{"x":69,"y":831,"width":808,"height":11}},{"id":"549e69cf-ed4f-4a4b-a1aa-5e0d89e9c399","block_type":"box","text":"opportunities among one or more accounts so long as the rotation system provides for fair access for all client","page_number":158,"box":{"x":69,"y":846,"width":791,"height":11}},{"id":"16342f60-555c-48e4-9914-c47956e1fd2a","block_type":"box","text":"accounts over time. Other allocation methodologies that are considered by BlackRock to be fair and equitable to","page_number":158,"box":{"x":69,"y":861,"width":799,"height":11}},{"id":"06e01a98-2def-4ad7-aae8-d31a135b4a25","block_type":"box","text":"clients may be used as well.","page_number":158,"box":{"x":69,"y":876,"width":200,"height":11}},{"id":"80dc818a-cfa0-4286-a9cf-c1575d7fd043","block_type":"box","text":"II-127","page_number":158,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"bcf3ab8c-c280-4fda-9d10-215fe881810f","block_type":"box","text":"NM0926U-5977317-158/232","page_number":158,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"d830e782-9a72-47f6-aac4-317e2d4ed0d8","block_type":"box","text":"Because different accounts may have differing investment objectives and policies, BlackRock may buy and sell","page_number":159,"box":{"x":102,"y":45,"width":789,"height":11}},{"id":"30c42095-3b37-45ef-82ae-d4fb43d93e22","block_type":"box","text":"the same securities at the same time for different clients based on the particular investment objective, guidelines","page_number":159,"box":{"x":68,"y":60,"width":815,"height":11}},{"id":"e0a292f2-deda-4905-8d26-695cf925919b","block_type":"box","text":"and strategies of those accounts. For example, BlackRock may decide that it may be entirely appropriate for a growth","page_number":159,"box":{"x":69,"y":75,"width":835,"height":11}},{"id":"59f48ec1-4895-4745-bbb7-6b196a9266dd","block_type":"box","text":"fund to sell a security at the same time a value fund is buying that security. To the extent that transactions on behalf","page_number":159,"box":{"x":68,"y":90,"width":833,"height":11}},{"id":"51b09872-53e3-4a05-bc0a-11c0cb466bb6","block_type":"box","text":"of more than one client of BlackRock or its affiliates during the same period may increase the demand for securities","page_number":159,"box":{"x":69,"y":105,"width":829,"height":11}},{"id":"ddaf9467-5240-474b-b071-5bace639aefa","block_type":"box","text":"being purchased or the supply of securities being sold, there may be an adverse effect on price. For example, sales","page_number":159,"box":{"x":69,"y":120,"width":825,"height":12}},{"id":"4d9ae321-ff4e-486a-b4ce-c5401ded1bcb","block_type":"box","text":"of a security by BlackRock on behalf of one or more of its clients may decrease the market price of such security,","page_number":159,"box":{"x":69,"y":135,"width":806,"height":11}},{"id":"1ca48d84-db2d-4001-8858-de0f36b27d86","block_type":"box","text":"adversely impacting other BlackRock clients that still hold the security. If purchases or sales of securities arise for","page_number":159,"box":{"x":69,"y":150,"width":814,"height":12}},{"id":"6068dea8-f57e-408a-82a3-eead52a83f92","block_type":"box","text":"consideration at or about the same time that would involve a Fund or other clients or funds for which BlackRock or an","page_number":159,"box":{"x":69,"y":166,"width":836,"height":9}},{"id":"d2c0710f-b09f-4e2e-9353-880019fdf8b1","block_type":"box","text":"affiliate act as investment manager, transactions in such securities will be made, insofar as feasible, for the","page_number":159,"box":{"x":69,"y":181,"width":773,"height":11}},{"id":"114d87cc-eb4f-4a29-a3fb-f394eb46998f","block_type":"box","text":"respective funds and clients in a manner deemed equitable to all.","page_number":159,"box":{"x":69,"y":196,"width":467,"height":11}},{"id":"86aa2e63-5998-46b5-9bf9-517c4805e1bb","block_type":"box","text":"In certain instances, BlackRock may find it efficient for purposes of seeking to obtain best execution, to","page_number":159,"box":{"x":102,"y":218,"width":741,"height":12}},{"id":"e4877dd1-5662-450c-86c4-d4039ef25643","block_type":"box","text":"aggregate certain contemporaneous purchases or sale orders of its advisory accounts. In general, all","page_number":159,"box":{"x":69,"y":234,"width":721,"height":11}},{"id":"50ebede8-e2ee-49f5-bc16-ab1c7c0cc012","block_type":"box","text":"contemporaneous trades for client accounts under management by the same portfolio manager or investment team","page_number":159,"box":{"x":69,"y":249,"width":824,"height":11}},{"id":"81db55b3-2940-4631-8f06-dc93b28a9449","block_type":"box","text":"will be aggregated in a single order if the trader believes the aggregated trade would provide each client with an","page_number":159,"box":{"x":68,"y":264,"width":795,"height":11}},{"id":"7af78720-36df-48a0-8232-f734090b2c97","block_type":"box","text":"opportunity to achieve a more favorable execution at a potentially lower execution cost. The costs associated with an","page_number":159,"box":{"x":69,"y":279,"width":834,"height":11}},{"id":"149809bb-cb25-4e84-af2e-69a29644c90c","block_type":"box","text":"aggregated order will be shared pro rata among the clients in the aggregated order. Generally, if an order for a","page_number":159,"box":{"x":69,"y":294,"width":783,"height":11}},{"id":"5ff86543-d31d-4c02-ac59-532564ca1f1e","block_type":"box","text":"particular portfolio manager or management team is filled at several different prices through multiple trades, all","page_number":159,"box":{"x":70,"y":309,"width":796,"height":11}},{"id":"02f1bcba-d95a-4cdf-b52d-d09674967c93","block_type":"box","text":"accounts participating in the order will receive the average price except in the case of certain international markets","page_number":159,"box":{"x":69,"y":324,"width":821,"height":12}},{"id":"0787e40f-be9d-4eac-99cf-749aa1314c3f","block_type":"box","text":"where average pricing is not permitted. While in some cases this practice could have a detrimental effect upon the","page_number":159,"box":{"x":68,"y":339,"width":819,"height":12}},{"id":"0e5afefb-88ac-47c0-9bde-db0d4199c292","block_type":"box","text":"price or value of the security as far as a Fund is concerned, in other cases it could be beneficial to the Fund.","page_number":159,"box":{"x":70,"y":355,"width":771,"height":11}},{"id":"532aeac1-1d8b-4a93-8fc3-9538f045d272","block_type":"box","text":"Transactions effected by BlackRock on behalf of more than one of its clients during the same period may increase","page_number":159,"box":{"x":68,"y":370,"width":815,"height":11}},{"id":"ff9685ed-91a0-4501-9c1d-7951a3ca7e07","block_type":"box","text":"the demand for securities being purchased or the supply of securities being sold, causing an adverse effect on price.","page_number":159,"box":{"x":68,"y":385,"width":835,"height":11}},{"id":"c2a052ad-3138-4d56-9ca0-abd6907097e0","block_type":"box","text":"The trader will give the aggregated order to the broker-dealer that the trader has identified as being able to provide","page_number":159,"box":{"x":68,"y":400,"width":817,"height":11}},{"id":"8ab0d21c-cd77-46f8-afb7-c0a137a0d2d7","block_type":"box","text":"the best execution of the order. Orders for purchase or sale of securities will be placed within a reasonable amount","page_number":159,"box":{"x":68,"y":415,"width":823,"height":11}},{"id":"f2c2f3d2-75b0-483e-aa05-405f540da81b","block_type":"box","text":"of time of the order receipt and aggregated orders will be kept aggregated only long enough to execute the order.","page_number":159,"box":{"x":69,"y":430,"width":803,"height":11}},{"id":"c8763ffd-29c4-46c0-9c95-4d18ab954c5c","block_type":"box","text":"A Fund will not purchase securities during the existence of any underwriting or selling group relating to such","page_number":159,"box":{"x":101,"y":453,"width":767,"height":11}},{"id":"0c81e58d-b554-49ea-9848-d6253c38cd13","block_type":"box","text":"securities of which BlackRock, BRIL or any affiliated person (as defined in the Investment Company Act) thereof is a","page_number":159,"box":{"x":69,"y":468,"width":826,"height":11}},{"id":"731ebf7c-623e-43b4-a0af-cfd2a15c17a5","block_type":"box","text":"member except pursuant to procedures adopted by the Board of Directors in accordance with Rule 10f-3 under the","page_number":159,"box":{"x":69,"y":483,"width":816,"height":11}},{"id":"04bb52a7-7f79-4ec5-8605-7b514133477c","block_type":"box","text":"Investment Company Act. In no instance will portfolio securities be purchased from or sold to BlackRock, BRIL or any","page_number":159,"box":{"x":70,"y":498,"width":833,"height":11}},{"id":"20b03d30-d8ca-45fe-a2c6-b8bf364402f3","block_type":"box","text":"affiliated person of the foregoing entities except as permitted by Commission exemptive order or by applicable law.","page_number":159,"box":{"x":69,"y":513,"width":818,"height":12}},{"id":"e1a6ee02-d2e3-41cb-85b2-8927347d3f5e","block_type":"box","text":"A Fund’s purchase and sale orders for securities may be combined with those of other investment companies,","page_number":159,"box":{"x":101,"y":536,"width":786,"height":11}},{"id":"f8b62926-309c-4280-9058-5fdd1454e535","block_type":"box","text":"clients or accounts that BlackRock manages or advises. If purchases or sales of portfolio securities of a Fund and","page_number":159,"box":{"x":69,"y":551,"width":814,"height":11}},{"id":"5b7fd174-a92d-4db9-b8e0-52a067f9f2cf","block_type":"box","text":"one or more other accounts managed or advised by BlackRock are considered at or about the same time,","page_number":159,"box":{"x":69,"y":566,"width":751,"height":11}},{"id":"853c2724-f413-487e-9377-ca5dd88cf2bb","block_type":"box","text":"transactions in such securities are allocated among the Fund and the other accounts in a manner deemed equitable","page_number":159,"box":{"x":68,"y":582,"width":829,"height":11}},{"id":"bff890ef-fd37-4606-ab7b-4a3c9ba44ded","block_type":"box","text":"to all by BlackRock. In some cases, this procedure could have a detrimental effect on the price or volume of the","page_number":159,"box":{"x":68,"y":596,"width":799,"height":12}},{"id":"ef5dd792-5f95-42c8-8691-881593e8d6e1","block_type":"box","text":"security as far as a Fund is concerned. However, in other cases, it is possible that the ability to participate in volume","page_number":159,"box":{"x":69,"y":612,"width":834,"height":11}},{"id":"17ee9abe-291a-4eca-bbe8-d1c9fec92ea8","block_type":"box","text":"transactions and to negotiate lower transaction costs will be beneficial to the Fund. BlackRock may deal, trade and","page_number":159,"box":{"x":68,"y":627,"width":820,"height":11}},{"id":"1b55b471-c882-4241-895d-83cfaf0a72a8","block_type":"box","text":"invest for its own account in the types of securities in which a Fund may invest. BlackRock may, from time to time,","page_number":159,"box":{"x":70,"y":642,"width":812,"height":11}},{"id":"bf9e63f8-ed18-4ed5-aaf4-abbabed0c54f","block_type":"box","text":"effect trades on behalf of and for the account of a Fund with brokers or dealers that are affiliated with BFA, in","page_number":159,"box":{"x":69,"y":657,"width":781,"height":10}},{"id":"44dcbfc0-118b-4e0a-aa7c-620c0a0ee25c","block_type":"box","text":"conformity with the Investment Company Act and Commission rules and regulations. Under these provisions, any","page_number":159,"box":{"x":69,"y":672,"width":805,"height":11}},{"id":"21c6821c-573e-495c-8d03-2d362e91b438","block_type":"box","text":"commissions paid to affiliated brokers or dealers must be reasonable and fair compared to the commissions charged","page_number":159,"box":{"x":69,"y":687,"width":840,"height":11}},{"id":"67e9e0a4-db7a-4621-a6ef-83ef4bd14a9f","block_type":"box","text":"by other brokers or dealers in comparable transactions. A Fund will not deal with affiliates in principal transactions","page_number":159,"box":{"x":69,"y":702,"width":815,"height":11}},{"id":"20f5e777-42f6-4d42-9f02-7b29dcdfc5b5","block_type":"box","text":"unless permitted by applicable Commission rules or regulations, or by Commission exemptive order.","page_number":159,"box":{"x":69,"y":718,"width":713,"height":11}},{"id":"e293e4f3-fb85-49cb-a420-9552a21dad4c","block_type":"box","text":"Portfolio Turnover","page_number":159,"box":{"x":69,"y":748,"width":129,"height":9}},{"id":"6aacf6a8-695f-4f1b-ac37-558d108ec025","block_type":"box","text":"The portfolio turnover rate is calculated by dividing the lesser of a Fund’s annual sales or purchases of portfolio","page_number":159,"box":{"x":101,"y":770,"width":798,"height":12}},{"id":"0af35efd-6b9b-4504-9c58-ef219ed32e81","block_type":"box","text":"securities (exclusive of purchases or sales of U.S. Government Securities and all other securities whose maturities at","page_number":159,"box":{"x":69,"y":785,"width":839,"height":11}},{"id":"918393d5-d2f5-45f6-ad2a-f5676d4a34a0","block_type":"box","text":"the time of acquisition were one year or less) by the monthly average value of the securities in the portfolio during","page_number":159,"box":{"x":68,"y":801,"width":814,"height":11}},{"id":"87aa4b5f-eed9-43bb-ba37-6e8e62a887cd","block_type":"box","text":"the year. A high rate of portfolio turnover results in certain tax consequences, such as increased capital gain","page_number":159,"box":{"x":68,"y":816,"width":777,"height":11}},{"id":"33da0c71-8996-4c9e-9454-7cc2115424fc","block_type":"box","text":"dividends and/or ordinary income dividends, and in correspondingly greater transaction costs in the form of dealer","page_number":159,"box":{"x":69,"y":831,"width":818,"height":11}},{"id":"edda21b6-464b-494a-8fb1-1778c28d5e50","block_type":"box","text":"spreads and brokerage commissions, which are borne directly by a Fund.","page_number":159,"box":{"x":69,"y":846,"width":519,"height":11}},{"id":"d5b9abc5-701a-4544-91fd-13fc6822e89f","block_type":"box","text":"II-128","page_number":159,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"fc7daf57-d999-462c-a0e3-20a358b72693","block_type":"box","text":"NM0926U-5977317-159/232","page_number":159,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"24a59b7b-adf1-46d8-82e8-bddaf9ba6ecb","block_type":"box","text":"DIVIDENDS AND TAXES","page_number":160,"box":{"x":396,"y":45,"width":186,"height":10}},{"id":"c1d6b498-86ca-45da-a72d-d54c150e131a","block_type":"box","text":"Dividends","page_number":160,"box":{"x":69,"y":76,"width":69,"height":8}},{"id":"5ace12ad-a4e0-4228-94a2-3b06d87bc739","block_type":"box","text":"Each Fund intends to distribute substantially all of its net investment income, if any. Dividends from such net","page_number":160,"box":{"x":102,"y":98,"width":776,"height":11}},{"id":"c425752c-e7d4-42bb-9adf-e8aa1e27600b","block_type":"box","text":"investment income are paid as set forth in each Fund’s Prospectus. Each Fund also intends to distribute all net","page_number":160,"box":{"x":70,"y":113,"width":795,"height":11}},{"id":"b6684c6b-fd7e-4ab4-94db-1a108fa9cbec","block_type":"box","text":"realized capital gains, if any, as set forth in such Fund’s Prospectus. From time to time, a Fund may declare a special","page_number":160,"box":{"x":69,"y":128,"width":837,"height":12}},{"id":"845d7a7b-fad5-401d-814a-f64a680c44a5","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 certain","page_number":160,"box":{"x":69,"y":143,"width":836,"height":12}},{"id":"0c0c9427-72ba-42eb-8138-30dbf7f924ce","block_type":"box","text":"percentages of its ordinary income and capital gains be distributed during the year. If, in any fiscal year, a Fund has","page_number":160,"box":{"x":70,"y":159,"width":822,"height":11}},{"id":"82ae500c-531b-4eb3-9da1-4f44bb5bf268","block_type":"box","text":"net income from certain foreign currency transactions, such income will be distributed at least annually.","page_number":160,"box":{"x":69,"y":174,"width":739,"height":11}},{"id":"a8ba61b8-f57e-486c-8764-9f5c30b39bdd","block_type":"box","text":"For information concerning the manner in which dividends may be reinvested automatically in shares of each","page_number":160,"box":{"x":102,"y":196,"width":773,"height":12}},{"id":"5efe6372-467b-4549-9850-cd442f3eff92","block_type":"box","text":"Fund, as applicable, see “Shareholder Services — Automatic Dividend Reinvestment Plan.” Shareholders may also","page_number":160,"box":{"x":70,"y":212,"width":819,"height":11}},{"id":"2324875d-181a-4a20-993b-2ed56054a653","block_type":"box","text":"elect in writing to receive any such dividends in cash. Dividends are taxable to shareholders, as discussed below,","page_number":160,"box":{"x":69,"y":227,"width":807,"height":11}},{"id":"6c41d3d2-b262-4e63-b41d-30d860da9fd0","block_type":"box","text":"whether they are reinvested in shares of the Fund or received in cash. The per share dividends on front-end load","page_number":160,"box":{"x":68,"y":242,"width":800,"height":11}},{"id":"9d1487ba-0a5b-4d05-8592-4656f24f50d0","block_type":"box","text":"shares, CDSC shares and Service Shares will be lower than the per share dividends on Institutional Shares as a","page_number":160,"box":{"x":69,"y":257,"width":801,"height":11}},{"id":"829909a2-90df-4fb3-a5ee-6ef9da9f489d","block_type":"box","text":"result of the service, distribution and higher transfer agency fees applicable to CDSC shares, the service fees","page_number":160,"box":{"x":69,"y":272,"width":783,"height":11}},{"id":"4869c7b4-76a5-4c7c-b091-bf2cdad53aa5","block_type":"box","text":"applicable to front-end load shares and Service Shares, and the service and distribution fees applicable to Class R","page_number":160,"box":{"x":69,"y":287,"width":820,"height":11}},{"id":"b1a7d1e0-6d32-4180-a063-9e4eb28f1579","block_type":"box","text":"Shares. Similarly, the per share dividends on CDSC shares and Class R Shares will be lower than the per share","page_number":160,"box":{"x":69,"y":302,"width":794,"height":11}},{"id":"79a2fb82-67b7-4913-801f-fa0adbd59b04","block_type":"box","text":"dividends on front-end load shares and Service Shares as a result of the distribution fees and higher transfer agency","page_number":160,"box":{"x":69,"y":317,"width":834,"height":12}},{"id":"07fda50c-1790-4ca2-a094-35e7001eb4d7","block_type":"box","text":"fees applicable to CDSC shares and the distribution fees applicable to Class R Shares, and the per share dividends","page_number":160,"box":{"x":68,"y":332,"width":826,"height":11}},{"id":"c63bf40c-2f8a-40d7-9302-eb30c22823a7","block_type":"box","text":"on CDSC shares will be lower than the per share dividends on Class R Shares as a result of the higher distribution","page_number":160,"box":{"x":69,"y":348,"width":816,"height":11}},{"id":"11b25c2d-537e-4afb-ab4c-2525bd096882","block_type":"box","text":"fees and higher transfer agency fees applicable to CDSC shares.","page_number":160,"box":{"x":68,"y":363,"width":461,"height":11}},{"id":"b4aa89a2-d958-4eaf-9c2e-a209100c9e0c","block_type":"box","text":"Taxes","page_number":160,"box":{"x":68,"y":393,"width":42,"height":9}},{"id":"4bc69de8-a2b4-4bcd-a8ce-092569ff2c62","block_type":"box","text":"Each Fund intends to continue to qualify for the special tax treatment afforded to regulated investment","page_number":160,"box":{"x":102,"y":416,"width":732,"height":11}},{"id":"fb79f4a6-469f-429a-ac82-c0ca812d6448","block_type":"box","text":"companies under the Code. As long as a Fund so qualifies, the Fund (but not its shareholders) will not be subject to","page_number":160,"box":{"x":69,"y":431,"width":825,"height":11}},{"id":"ef99eeae-34ce-4f42-9cb8-401ba847c87f","block_type":"box","text":"U.S. federal income tax on the part of its investment company taxable income and net realized capital gains that it","page_number":160,"box":{"x":70,"y":446,"width":817,"height":11}},{"id":"5d68bf55-0a46-4953-bd2d-702d6ef5ecbb","block_type":"box","text":"distributes to its shareholders in years in which it distributes at least 90% of its investment company taxable income","page_number":160,"box":{"x":69,"y":461,"width":832,"height":11}},{"id":"026a52d8-a6b1-4ffc-84e0-5e67d6e25826","block_type":"box","text":"and at least 90% of its net tax-exempt interest income, if any, for the year. To qualify as a regulated investment","page_number":160,"box":{"x":69,"y":476,"width":791,"height":11}},{"id":"debb8d27-3851-4221-a3c0-df390d1e83e0","block_type":"box","text":"company, a Fund must meet certain requirements regarding the source of its income and the composition and","page_number":160,"box":{"x":69,"y":491,"width":786,"height":12}},{"id":"8f903e6e-4fb5-404c-870a-d73417f022d7","block_type":"box","text":"diversification of its assets. See Part II, “Investment Risks and Considerations—Investment Restrictions (All Funds)”","page_number":160,"box":{"x":69,"y":506,"width":831,"height":11}},{"id":"f347bcec-f682-418b-9c2c-5feaf8c28e26","block_type":"box","text":"for a discussion of the asset diversification requirements. In the case of a Feeder Fund, such Fund may look to the","page_number":160,"box":{"x":68,"y":521,"width":819,"height":12}},{"id":"a7879264-b3ac-42d5-99ff-298b576e9341","block_type":"box","text":"underlying assets of the Master Portfolio in which it has invested for purposes of satisfying the asset diversification","page_number":160,"box":{"x":69,"y":537,"width":824,"height":11}},{"id":"da5104c1-4bfb-4c62-8cc1-7dac314d2742","block_type":"box","text":"requirement and various other requirements of the Code applicable to regulated investment companies.","page_number":160,"box":{"x":69,"y":552,"width":739,"height":11}},{"id":"0e5e06e8-1889-4954-8d85-543639a5b4bb","block_type":"box","text":"A Fund may be able to cure a failure to derive at least 90% of its income from the sources specified above or a","page_number":160,"box":{"x":101,"y":574,"width":792,"height":12}},{"id":"9d8f9ad9-efe9-4b05-a99a-67ca4f9bed8f","block_type":"box","text":"failure to diversify its holdings in the manner described above by paying a tax, by disposing of certain assets, or by","page_number":160,"box":{"x":68,"y":589,"width":819,"height":12}},{"id":"fc45032f-c8dd-4d9a-b78f-56a5c2b7c152","block_type":"box","text":"paying a tax and disposing of assets. If, in any taxable year, a Fund fails one of these tests and does not timely cure","page_number":160,"box":{"x":70,"y":605,"width":830,"height":11}},{"id":"bb0d3820-8350-4736-87a9-2b00afbc40c1","block_type":"box","text":"the failure, the Fund will be taxed in the same manner as an ordinary corporation and distributions to its","page_number":160,"box":{"x":68,"y":620,"width":744,"height":11}},{"id":"a01421c3-4254-4d5f-88f1-56205eeb0e9b","block_type":"box","text":"shareholders will not be deductible by the Fund in computing its taxable income. Although in general the passive loss","page_number":160,"box":{"x":69,"y":635,"width":835,"height":11}},{"id":"0f36fdec-4a1e-4226-9c87-6181184ff943","block_type":"box","text":"rules of the Code do not apply to regulated investment companies, such rules do apply to a regulated investment","page_number":160,"box":{"x":69,"y":650,"width":808,"height":11}},{"id":"32bd8da9-1d94-4c69-8fd3-ba08f39e47a7","block_type":"box","text":"company with respect to items attributable to an interest in a qualified publicly-traded partnership. A Fund’s","page_number":160,"box":{"x":69,"y":665,"width":767,"height":11}},{"id":"d2f9efbb-91a7-44a7-bd96-1114e192706f","block_type":"box","text":"investments in partnerships, including in qualified publicly-traded partnerships, may result in the Fund being subject","page_number":160,"box":{"x":70,"y":680,"width":826,"height":12}},{"id":"e520db33-2e11-4d76-a2c6-c1272845df07","block_type":"box","text":"to state, local, or non-U.S. income, franchise or withholding tax liabilities.","page_number":160,"box":{"x":68,"y":695,"width":521,"height":12}},{"id":"8d18887e-90d3-42b1-b149-920c2b4f6aaa","block_type":"box","text":"Each Fund intends to distribute substantially all of such income and gains. If, in any taxable year, a Fund fails to","page_number":160,"box":{"x":102,"y":718,"width":798,"height":11}},{"id":"df5aeea8-7dfa-4205-be73-d4cf5f47bf94","block_type":"box","text":"qualify as a regulated investment company under the Code, notwithstanding the availability of certain relief","page_number":160,"box":{"x":69,"y":733,"width":762,"height":11}},{"id":"610f6860-d13c-4d08-86df-f986632f3077","block_type":"box","text":"provisions, such Fund would be taxed in the same manner as an ordinary corporation and all distributions from","page_number":160,"box":{"x":70,"y":748,"width":789,"height":11}},{"id":"1e1019c1-b575-437c-a818-239cbf6b30b3","block_type":"box","text":"earnings and profits (as determined under U.S. federal income tax principles) to its shareholders would be taxable as","page_number":160,"box":{"x":69,"y":763,"width":837,"height":12}},{"id":"589b1643-bd6e-4feb-b23e-9e0177154d4f","block_type":"box","text":"ordinary dividend income eligible for taxation at a reduced tax rate for non-corporate shareholders and the dividends","page_number":160,"box":{"x":69,"y":778,"width":831,"height":12}},{"id":"5fd1b28a-dc46-4c4b-8932-5a518774f3e8","block_type":"box","text":"received deduction for corporate shareholders. However, a Municipal Fund’s distributions derived from income on tax","page_number":160,"box":{"x":69,"y":794,"width":837,"height":11}},{"id":"d7cd615f-6c74-48db-8bd3-784df2dcaaea","block_type":"box","text":"exempt obligations, as defined herein, would no longer qualify for treatment as exempt interest. Each Fund that is a","page_number":160,"box":{"x":69,"y":809,"width":825,"height":11}},{"id":"04fd8705-3b85-417f-bff5-f0eb3e387ae4","block_type":"box","text":"series of a regulated investment company that consists of multiple series is treated as a separate corporation for","page_number":160,"box":{"x":69,"y":824,"width":811,"height":11}},{"id":"24682854-6ef4-4b06-b861-3518155c61a9","block_type":"box","text":"U.S. federal income tax purposes, and therefore is considered to be a separate entity in determining its treatment","page_number":160,"box":{"x":70,"y":839,"width":813,"height":11}},{"id":"98b96180-bfc9-4f32-8dd6-9372f09041db","block_type":"box","text":"under the rules for regulated investment companies. Losses in one series of a regulated investment company do not","page_number":160,"box":{"x":69,"y":854,"width":834,"height":11}},{"id":"cccf3ecd-1831-4c26-ae9f-b9a50159153f","block_type":"box","text":"offset gains in another, and the requirements (other than certain organizational requirements) for qualifying for","page_number":160,"box":{"x":69,"y":869,"width":790,"height":11}},{"id":"e70a30c4-90dc-4186-875c-3cb08d5b08e7","block_type":"box","text":"regulated investment company status will be determined at the level of the individual series. In the following","page_number":160,"box":{"x":69,"y":884,"width":771,"height":12}},{"id":"c7cee803-2c00-4418-a484-999914ba66b8","block_type":"box","text":"discussion, the term “Fund” means each individual series, if applicable.","page_number":160,"box":{"x":69,"y":899,"width":512,"height":11}},{"id":"c0ca1172-6509-441d-a625-411f880879e0","block_type":"box","text":"II-129","page_number":160,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"33100f81-a79a-46da-a518-4e046e1f300f","block_type":"box","text":"NM0926U-5977317-160/232","page_number":160,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"2d0487a3-a9c3-4b30-b975-49f6d637728b","block_type":"box","text":"The Code requires a regulated investment company to pay a nondeductible 4% excise tax to the extent the","page_number":161,"box":{"x":101,"y":45,"width":759,"height":11}},{"id":"ad7ad268-7edc-4c38-942e-26d10c6af7c9","block_type":"box","text":"regulated investment company does not distribute, during each calendar year, at least 98% of its ordinary income,","page_number":161,"box":{"x":69,"y":60,"width":813,"height":11}},{"id":"a767551d-c011-41af-904b-db8863e08f2e","block_type":"box","text":"determined on a calendar year basis, and at least 98.2% of its capital gain net income, determined, in general, as if","page_number":161,"box":{"x":69,"y":75,"width":830,"height":11}},{"id":"84857972-939e-4899-84d5-35a5ff79c26d","block_type":"box","text":"the regulated investment company’s taxable year ended on October 31, plus certain undistributed amounts from the","page_number":161,"box":{"x":68,"y":90,"width":832,"height":11}},{"id":"8958cbd8-a087-4521-9a63-c4a156dfd9b4","block_type":"box","text":"previous years. While each Fund intends to distribute its income and capital gains in the manner necessary to avoid","page_number":161,"box":{"x":70,"y":105,"width":825,"height":11}},{"id":"2f087b3a-8716-4639-8e9d-589441ed352c","block_type":"box","text":"imposition of the 4% excise tax, there can be no assurance that a sufficient amount of the Fund’s taxable income","page_number":161,"box":{"x":70,"y":120,"width":810,"height":11}},{"id":"aa1d39fc-a257-4471-889f-7ba32597ae96","block_type":"box","text":"and capital gains will be distributed to avoid entirely the imposition of the tax. In such event, a Fund will be liable for","page_number":161,"box":{"x":69,"y":135,"width":828,"height":12}},{"id":"f00367ef-7326-437e-9ce9-ff48264b5b02","block_type":"box","text":"the tax only on the amount by which it does not meet the foregoing distribution requirements.","page_number":161,"box":{"x":68,"y":150,"width":666,"height":12}},{"id":"59849f12-0401-4ea2-a523-857b1b7350e5","block_type":"box","text":"Net capital loss carryforwards may be applied against realized capital gains in each succeeding year, until they","page_number":161,"box":{"x":102,"y":173,"width":790,"height":11}},{"id":"36034167-f935-4712-a058-c6689fdd4437","block_type":"box","text":"have been reduced to zero. In the event that the Fund were to experience an ownership change as defined under the","page_number":161,"box":{"x":69,"y":188,"width":830,"height":12}},{"id":"d5041d71-1415-41df-b907-c3b883c511aa","block_type":"box","text":"Code, the Fund’s loss carryforwards and other favorable tax attributes of the Fund, if any, may be subject to","page_number":161,"box":{"x":69,"y":203,"width":770,"height":12}},{"id":"e014c283-76c6-4da8-bc1e-a3d0c92e0af4","block_type":"box","text":"limitation.","page_number":161,"box":{"x":70,"y":219,"width":68,"height":8}},{"id":"ac0da6f0-c5e2-43f0-8ba7-76c12100fe9b","block_type":"box","text":"Dividends paid by a Fund from its ordinary income or from an excess of net short-term capital gain over net long","page_number":161,"box":{"x":102,"y":241,"width":803,"height":11}},{"id":"86a8e670-a796-4b1f-9395-0ea23dbda4b1","block_type":"box","text":"term capital loss (together referred to as “ordinary income dividends”) are taxable to shareholders as ordinary","page_number":161,"box":{"x":68,"y":256,"width":790,"height":12}},{"id":"d77d32f6-e00c-4600-b3fc-435e791dfc65","block_type":"box","text":"income. Distributions made from an excess of net long-term capital gain over net short-term capital loss (including","page_number":161,"box":{"x":70,"y":271,"width":815,"height":12}},{"id":"65cbe8e2-8419-4b9a-b96f-f7e49dd01dfb","block_type":"box","text":"gains or losses from certain transactions in futures and options) (“capital gain dividends”) are taxable to","page_number":161,"box":{"x":68,"y":286,"width":748,"height":12}},{"id":"83ceb4df-410b-43eb-9e69-e0349830af46","block_type":"box","text":"shareholders as long-term capital gains, regardless of the length of time the shareholder has owned Fund shares.","page_number":161,"box":{"x":69,"y":302,"width":811,"height":11}},{"id":"4497abc1-37ab-4acf-b175-92c07a9bfc55","block_type":"box","text":"Distributions paid by a Fund that are reported as exempt-interest dividends will not be subject to regular U.S. federal","page_number":161,"box":{"x":70,"y":317,"width":829,"height":11}},{"id":"b02c5731-9b52-4e41-b38a-648b5d9c37ac","block_type":"box","text":"income tax. Certain dividend income and long-term capital gains are eligible for taxation at a reduced rate that","page_number":161,"box":{"x":70,"y":332,"width":785,"height":11}},{"id":"2410388a-4852-4218-9d6a-6f3bea957460","block_type":"box","text":"applies to non-corporate shareholders. Under these rules, the portion of ordinary income dividends constituting","page_number":161,"box":{"x":69,"y":347,"width":795,"height":11}},{"id":"b6d7d713-0f16-4eff-8912-fc96bcc77ab1","block_type":"box","text":"“qualified dividend income” when paid by a regulated investment company to a non-corporate shareholder may be","page_number":161,"box":{"x":70,"y":362,"width":809,"height":11}},{"id":"800f1120-1b17-4936-9865-c0d9f12c2050","block_type":"box","text":"taxable to such shareholder at long-term capital gain rates provided the shareholder has held the shares on which","page_number":161,"box":{"x":68,"y":377,"width":814,"height":12}},{"id":"ec1a7fda-a25a-4a2d-91e2-1d081c885204","block_type":"box","text":"the dividend was paid for at least 61 days during the 121-day period that begins on the date that is 60 days before","page_number":161,"box":{"x":68,"y":392,"width":822,"height":12}},{"id":"018e5368-81ac-4a4e-8f8b-f410da9e0160","block_type":"box","text":"the date on which the shares become ex-dividend with respect to such dividend (or, in the case of certain","page_number":161,"box":{"x":68,"y":407,"width":751,"height":11}},{"id":"b513487c-6088-4869-9626-62f94f3fc3d4","block_type":"box","text":"accumulated dividends with respect to preferred stocks, the shareholder has held the shares on which the dividend","page_number":161,"box":{"x":69,"y":423,"width":823,"height":11}},{"id":"7ad0fbaa-a5ab-42c7-b2fa-5b59cbafc7bc","block_type":"box","text":"was paid for at least 91 days during the 181-day period that begins on the date that is 90 days before the date on","page_number":161,"box":{"x":68,"y":438,"width":817,"height":11}},{"id":"5298469a-197a-4ae5-b371-868c012fe825","block_type":"box","text":"which the shares become ex-dividend with respect to such dividend). However, to the extent a Fund’s distributions","page_number":161,"box":{"x":68,"y":453,"width":813,"height":11}},{"id":"ec96c703-34b1-497a-b9e3-8ed2fd1ebfe5","block_type":"box","text":"are derived from income on debt securities, certain types of preferred stock treated as debt for U.S. federal income","page_number":161,"box":{"x":69,"y":468,"width":825,"height":11}},{"id":"05f964e0-c60e-4a1f-87b1-54bb374fd53a","block_type":"box","text":"tax purposes and short-term capital gains, such distributions will not constitute “qualified dividend income.” In","page_number":161,"box":{"x":68,"y":483,"width":789,"height":11}},{"id":"6d73437c-a580-4f4d-8a39-3f60f5019ddf","block_type":"box","text":"addition, distributions that are derived from securities lending income, such as substitute dividend payments, will not","page_number":161,"box":{"x":69,"y":498,"width":836,"height":11}},{"id":"ff111c48-5b34-4abc-a614-1180d62a7f04","block_type":"box","text":"constitute “qualified dividend income.”","page_number":161,"box":{"x":69,"y":513,"width":275,"height":11}},{"id":"c7bfed00-10be-4207-940e-3b5e9eade1a6","block_type":"box","text":"A 3.8% Medicare tax is imposed on the net investment income (which includes taxable dividends and redemption","page_number":161,"box":{"x":101,"y":536,"width":806,"height":11}},{"id":"25c02064-06a0-4554-9551-52d99e005624","block_type":"box","text":"proceeds) of certain individuals, trusts and estates.","page_number":161,"box":{"x":70,"y":551,"width":368,"height":11}},{"id":"eda248d1-7872-45f6-b888-698d3e379dc0","block_type":"box","text":"A Fund’s net capital gain (the excess of net long-term capital gains over net short-term capital losses) is not","page_number":161,"box":{"x":101,"y":574,"width":772,"height":11}},{"id":"aecb77c9-cd83-465b-8617-3ff117e2f1a1","block_type":"box","text":"subject to the 90% distribution requirement for taxation as a regulated investment company, described above. If a","page_number":161,"box":{"x":69,"y":589,"width":811,"height":11}},{"id":"eb30bec9-34ae-4471-9691-2120448feeec","block_type":"box","text":"Fund retains net capital gain, it is subject to tax on that gain, and may designate the retained amount as","page_number":161,"box":{"x":70,"y":604,"width":745,"height":11}},{"id":"f4340963-38db-4ccc-9a59-246d70d70e16","block_type":"box","text":"undistributed capital gain in a written statement furnished to its shareholders, who will be required to include in","page_number":161,"box":{"x":69,"y":619,"width":795,"height":11}},{"id":"f33ec469-6037-43a1-8755-af085c1ca315","block_type":"box","text":"income, as long-term capital gain, their proportionate shares of such undistributed net capital gain, will be deemed to","page_number":161,"box":{"x":70,"y":634,"width":838,"height":12}},{"id":"33411f0b-9556-4f5c-ba92-9f7334f4f755","block_type":"box","text":"have paid and may claim as a credit against their U.S. federal income tax liability (and as a refund to the extent it","page_number":161,"box":{"x":69,"y":649,"width":809,"height":12}},{"id":"7404e7ee-e7dc-4abb-b0c7-1dddec72e6b0","block_type":"box","text":"exceeds that liability) their proportionate shares of the tax paid by the Fund on that gain, and shall increase the tax","page_number":161,"box":{"x":69,"y":664,"width":822,"height":12}},{"id":"d82e4ddd-11d5-46ab-978a-b29842c4f6ac","block_type":"box","text":"basis of their shares in the Fund by the excess of the amount included in income over the amount allowed as a credit","page_number":161,"box":{"x":69,"y":680,"width":838,"height":11}},{"id":"15f799ff-b34d-4287-84a4-e1a028943231","block_type":"box","text":"against their taxes.","page_number":161,"box":{"x":69,"y":695,"width":135,"height":11}},{"id":"d60dd464-08f4-4c52-8f75-2b1b10694e74","block_type":"box","text":"Distributions in excess of a Fund’s current and accumulated earnings and profits will first reduce the adjusted","page_number":161,"box":{"x":102,"y":717,"width":783,"height":12}},{"id":"dc0c893e-628d-4a9c-aa23-33de79f7a3c1","block_type":"box","text":"tax basis of a holder’s shares and after such adjusted tax basis is reduced to zero, will constitute capital gains to","page_number":161,"box":{"x":68,"y":732,"width":812,"height":12}},{"id":"61b68397-c031-4424-88d5-64b3e6a6ba3a","block_type":"box","text":"such holder (assuming the shares are held as a capital asset). Distributions in excess of a Fund’s minimum","page_number":161,"box":{"x":69,"y":748,"width":769,"height":11}},{"id":"e30057b2-e25d-4908-852b-d50e67cd2f00","block_type":"box","text":"distribution requirements (or taxable income) but not in excess of a Fund’s earnings and profits will be taxable to","page_number":161,"box":{"x":69,"y":763,"width":805,"height":11}},{"id":"361b3079-2f6f-4557-a4ff-11e47a37c8bf","block_type":"box","text":"shareholders and will not constitute nontaxable returns of capital. In the case of a Fund with a non-calendar taxable","page_number":161,"box":{"x":69,"y":778,"width":824,"height":11}},{"id":"116abb1c-e8b5-47dd-afec-47a3fce4f5cf","block_type":"box","text":"year, a Fund’s earnings and profits are allocated first to distributions made on or before December 31 of the taxable","page_number":161,"box":{"x":68,"y":793,"width":831,"height":11}},{"id":"40dbab3a-dabc-411a-be40-0f1240008f8a","block_type":"box","text":"year, and then to distributions made after December 31 of the taxable year. Any loss upon the sale or exchange of","page_number":161,"box":{"x":68,"y":808,"width":817,"height":11}},{"id":"3831a801-4892-4bb1-8df5-0407e3344e9d","block_type":"box","text":"Fund shares held for six months or less will be treated as long-term capital loss to the extent of any capital gain","page_number":161,"box":{"x":70,"y":823,"width":797,"height":12}},{"id":"40f16722-8d53-43f3-b7f5-1263a4536f17","block_type":"box","text":"dividends received by the shareholder.","page_number":161,"box":{"x":69,"y":839,"width":272,"height":10}},{"id":"de272fb9-cdb4-42ac-b949-ea7729d9bd6e","block_type":"box","text":"Ordinary income and capital gain dividends are taxable to shareholders even if they are reinvested in additional","page_number":161,"box":{"x":102,"y":861,"width":792,"height":11}},{"id":"2933e111-5df1-497d-8ceb-f771c14aa64e","block_type":"box","text":"shares of a Fund. Distributions by a Fund, whether from ordinary income or capital gains, generally will not be eligible","page_number":161,"box":{"x":69,"y":876,"width":835,"height":11}},{"id":"7b818401-33c2-4240-b95f-502619052ed9","block_type":"box","text":"for the dividends received deduction allowed to corporations under the Code. If a Fund pays a dividend in January","page_number":161,"box":{"x":68,"y":891,"width":809,"height":11}},{"id":"e1e72de9-d06b-4a95-8050-7ed64c7d75a9","block_type":"box","text":"that was declared in the previous October, November or December to shareholders of record on a specified date in","page_number":161,"box":{"x":68,"y":906,"width":819,"height":11}},{"id":"54d1b255-d521-429a-b3d1-5ea856bee263","block_type":"box","text":"II-130","page_number":161,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"1cfa76f0-1d45-466e-9c13-aa8c7922f3d8","block_type":"box","text":"NM0926U-5977317-161/232","page_number":161,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"4e9a74c3-5357-47de-a800-efc514c5f195","block_type":"box","text":"one of such months, then such dividend will be treated for tax purposes as being paid by the Fund and received by its","page_number":162,"box":{"x":69,"y":45,"width":839,"height":11}},{"id":"12877f87-9aac-48c8-9d3f-ace1fb4d6de6","block_type":"box","text":"shareholders on December 31 of the year in which the dividend was declared. In the case of a Fund with a non","page_number":162,"box":{"x":69,"y":60,"width":794,"height":11}},{"id":"83a2e4c5-34e7-474c-a5fa-0e539e4ab54c","block_type":"box","text":"calendar taxable year, if the Fund reports more capital gain dividends than it earns in such taxable year, then the","page_number":162,"box":{"x":69,"y":75,"width":804,"height":11}},{"id":"6350eed8-e3bb-4b1c-861d-17d5ae173540","block_type":"box","text":"Fund will reduce the amounts reported as capital gains. Where possible, such reduction will first be allocated to","page_number":162,"box":{"x":70,"y":90,"width":797,"height":11}},{"id":"ba8b03ae-697a-4cd3-9310-76980363ae8f","block_type":"box","text":"dividends made after December 31 of such taxable year. A Fund may elect to defer recognizing, until the following","page_number":162,"box":{"x":69,"y":105,"width":810,"height":11}},{"id":"078a3eea-9923-4fc7-8429-be3ce02406fd","block_type":"box","text":"taxable year, certain net capital losses arising after October 31 of the current taxable year, and certain net ordinary","page_number":162,"box":{"x":68,"y":120,"width":826,"height":12}},{"id":"2056f708-3564-4baf-aaf1-3488d28a3ff9","block_type":"box","text":"losses arising after October 31 and/or December 31 of the current taxable year. This may have the effect of","page_number":162,"box":{"x":70,"y":135,"width":772,"height":12}},{"id":"b3cbd6d2-02af-4622-b99d-1f7097caabe1","block_type":"box","text":"increasing the amount of dividends otherwise includible in the shareholder’s income with respect to the current","page_number":162,"box":{"x":70,"y":150,"width":795,"height":12}},{"id":"7ef632a5-a8c1-49d9-a38f-3723bb330342","block_type":"box","text":"taxable year.","page_number":162,"box":{"x":68,"y":166,"width":89,"height":11}},{"id":"9f1c9295-aa02-40bf-8011-92eeceb29224","block_type":"box","text":"No gain or loss will be recognized by Investor C shareholders on the conversion to Investor A Shares. A","page_number":162,"box":{"x":102,"y":188,"width":733,"height":12}},{"id":"4c948dbb-14ac-498e-8630-d37e24b01724","block_type":"box","text":"shareholder’s tax basis in the Investor A Shares acquired upon conversion will be the same as the shareholder’s tax","page_number":162,"box":{"x":69,"y":203,"width":832,"height":11}},{"id":"d6914dfa-dc37-4805-a494-c19293fabf03","block_type":"box","text":"basis in the converted Investor C Shares and the holding period of the acquired Investor A Shares will include the","page_number":162,"box":{"x":69,"y":218,"width":809,"height":12}},{"id":"9bbf2fa4-d616-4414-8843-ba665a1be8f0","block_type":"box","text":"holding period for the converted Investor C Shares.","page_number":162,"box":{"x":69,"y":234,"width":362,"height":11}},{"id":"2900c776-3b69-4d5b-a804-aaa830247fd0","block_type":"box","text":"If a shareholder of a Fund exercises an exchange privilege within 90 days of acquiring the shares of a Fund, but","page_number":162,"box":{"x":102,"y":256,"width":795,"height":12}},{"id":"6461e620-2cc4-41a7-9cf4-8c795ecfe8c2","block_type":"box","text":"on or before January 31 of the following year, then the loss that the shareholder recognizes on the exchange will be","page_number":162,"box":{"x":69,"y":271,"width":824,"height":12}},{"id":"93c7b572-2315-44a9-815a-f773d7788570","block_type":"box","text":"reduced (or the gain increased) to the extent any sales charge paid on the exchanged shares reduces any sales","page_number":162,"box":{"x":69,"y":287,"width":797,"height":11}},{"id":"9fd939bf-5da1-4388-b895-9206d269e889","block_type":"box","text":"charge the shareholder would have owed upon the purchase of the new shares in the absence of the exchange","page_number":162,"box":{"x":69,"y":302,"width":791,"height":11}},{"id":"7a2322e3-98ff-42de-85cf-e11f29649c1e","block_type":"box","text":"privilege. Instead, such sales charge will be treated as an amount paid for the new shares.","page_number":162,"box":{"x":70,"y":317,"width":646,"height":11}},{"id":"86d15f38-1ad2-4411-a9b1-aba09d63ae25","block_type":"box","text":"A sale, redemption, or exchange of Fund shares may give rise to a gain or loss. In general, any gain or loss","page_number":162,"box":{"x":101,"y":339,"width":762,"height":12}},{"id":"dbe63fdb-2f64-4119-8c1f-ebc2451db199","block_type":"box","text":"realized upon a taxable disposition of shares of a Fund will be treated as long-term capital gain or loss if such shares","page_number":162,"box":{"x":69,"y":355,"width":836,"height":11}},{"id":"ed2f6cef-7f85-498a-95ba-69cd999efe43","block_type":"box","text":"have been held for more than 12 months. Otherwise, the gain or loss on the taxable disposition of Fund shares will","page_number":162,"box":{"x":69,"y":370,"width":822,"height":11}},{"id":"f174c03d-9fef-4344-b724-c02a787b49ce","block_type":"box","text":"generally be treated as short-term capital gain or loss. Any loss realized upon a taxable disposition of shares held for","page_number":162,"box":{"x":68,"y":385,"width":838,"height":11}},{"id":"06809735-8575-4095-a35b-f21efa0d22d9","block_type":"box","text":"six months or less will be treated as long-term capital loss, rather than short-term capital loss, to the extent of any","page_number":162,"box":{"x":69,"y":400,"width":820,"height":11}},{"id":"fa64aad7-4d09-4723-a417-8b024788766b","block_type":"box","text":"amounts treated as distributions to the shareholder of long-term capital gain (including any amounts credited to the","page_number":162,"box":{"x":69,"y":415,"width":823,"height":11}},{"id":"311430bf-f43d-4d95-9cad-64a1cbe74183","block_type":"box","text":"shareholder as undistributed capital gains). Shareholders that hold shares of a Fund through a qualified tax-exempt","page_number":162,"box":{"x":69,"y":430,"width":822,"height":11}},{"id":"ca8be0a9-cc0b-4991-b93b-bfebd2fe3db5","block_type":"box","text":"plan described in section 401(a) of the Internal Revenue Code should see the Fund’s Prospectus for a discussion of","page_number":162,"box":{"x":70,"y":445,"width":829,"height":11}},{"id":"f1220603-04ee-4cb6-88fe-aa9693123221","block_type":"box","text":"special tax rules that apply to their investments.","page_number":162,"box":{"x":69,"y":461,"width":343,"height":11}},{"id":"31e63cac-00ab-4d8a-90e6-995ed5fcb676","block_type":"box","text":"A loss realized on a sale or exchange of shares of a Fund will be disallowed if other substantially identical shares","page_number":162,"box":{"x":101,"y":483,"width":807,"height":11}},{"id":"199cd9ee-cec7-4406-9983-538e4aeccbf1","block_type":"box","text":"are acquired (whether through the automatic reinvestment of dividends or otherwise) within a 61-day period beginning","page_number":162,"box":{"x":69,"y":498,"width":839,"height":11}},{"id":"92544c05-09ae-4a04-9d98-25984ce221b7","block_type":"box","text":"30 days before and ending 30 days after the date on which the shares are sold or exchanged. In such case, the","page_number":162,"box":{"x":69,"y":513,"width":799,"height":12}},{"id":"b630fff3-5d8f-4ad9-8124-8e54b6f8f99e","block_type":"box","text":"basis of the shares acquired will be adjusted to reflect the disallowed loss.","page_number":162,"box":{"x":69,"y":528,"width":534,"height":12}},{"id":"f02ee973-5d99-4594-9ed1-70aff8883556","block_type":"box","text":"A Fund is also generally required by law to report to each shareholder and to the IRS cost basis information for","page_number":162,"box":{"x":101,"y":551,"width":792,"height":11}},{"id":"e91fd28d-a54a-4936-a67b-57b09c74fbba","block_type":"box","text":"shares of the Fund acquired on or after January 1, 2012, and sold or redeemed after that date. This information","page_number":162,"box":{"x":69,"y":566,"width":800,"height":11}},{"id":"5700695a-7dc1-4104-819a-aa30ec4f4620","block_type":"box","text":"includes the adjusted cost basis of the shares, the gross proceeds from disposition, and whether the gain or loss is","page_number":162,"box":{"x":70,"y":581,"width":828,"height":12}},{"id":"083a6ea2-78e5-435c-ae4a-8f7479bf4951","block_type":"box","text":"long-term or short-term. The adjusted cost basis of shares will be based on the default cost basis reporting method","page_number":162,"box":{"x":70,"y":596,"width":824,"height":12}},{"id":"0c983af2-b755-4589-8201-08a25065852b","block_type":"box","text":"selected by the Fund, unless a shareholder, before the sale or redemption, informs the Fund that it has selected a","page_number":162,"box":{"x":69,"y":612,"width":816,"height":11}},{"id":"bb218772-c670-4fe1-b0c2-2c008c6a03aa","block_type":"box","text":"different IRS-accepted method offered by the Fund. These requirements, however, will not apply for investments","page_number":162,"box":{"x":69,"y":627,"width":797,"height":11}},{"id":"b4607a88-a41d-45ee-b992-1144f128d43e","block_type":"box","text":"through an IRA or other tax-advantaged account. Shareholders should consult their tax advisors to determine the best","page_number":162,"box":{"x":68,"y":642,"width":840,"height":11}},{"id":"06a6a94e-0c89-42b5-be2f-192127256ea5","block_type":"box","text":"cost basis method for their tax situation, and to obtain more information about how these cost basis reporting","page_number":162,"box":{"x":69,"y":657,"width":788,"height":11}},{"id":"86a51fbb-96b3-471f-8188-cfe11bf0db33","block_type":"box","text":"requirements apply to them. For shares of a Fund acquired before January 1, 2012, these requirements will not","page_number":162,"box":{"x":69,"y":672,"width":797,"height":11}},{"id":"56bd598e-76f3-4479-b523-b4bd7cced201","block_type":"box","text":"apply, but the Fund will continue to report to the IRS the gross proceeds received by a shareholder from the sale or","page_number":162,"box":{"x":69,"y":687,"width":821,"height":11}},{"id":"f5e2e5fe-3d3c-41d4-a9de-504c3cb3493c","block_type":"box","text":"redemption of such shares.","page_number":162,"box":{"x":69,"y":702,"width":195,"height":11}},{"id":"49b0f32f-b06c-4ae0-8f05-6c6d2ba17c45","block_type":"box","text":"The Manager may determine it is in the best interest of a Fund to distribute portfolio securities in kind for the","page_number":162,"box":{"x":101,"y":725,"width":780,"height":11}},{"id":"058279d8-74b0-4d43-a93a-363b8c93e1c5","block_type":"box","text":"purposes of portfolio management when meeting redemption requests. When the Manager determines to do so, a","page_number":162,"box":{"x":70,"y":740,"width":814,"height":11}},{"id":"86fa62a6-c426-403d-b5f8-b9fc2515b56b","block_type":"box","text":"Fund generally will not recognize taxable gains in respect of the portfolio securities it distributes to the redeeming","page_number":162,"box":{"x":70,"y":755,"width":810,"height":11}},{"id":"310c4467-592c-41ac-a84f-8b05290af194","block_type":"box","text":"shareholder, which may reduce the amount of taxable gains the Fund would otherwise be required to distribute.","page_number":162,"box":{"x":69,"y":770,"width":793,"height":12}},{"id":"b94cc304-472e-4095-a088-b2c17dfa1d4c","block_type":"box","text":"While a Fund may engage in redemptions in kind that have the effect of reducing or eliminating distributable","page_number":162,"box":{"x":101,"y":793,"width":770,"height":11}},{"id":"3708a4ae-35ab-4c90-98f0-b6d84da0ca13","block_type":"box","text":"capital gains as described above, the Funds do not employ a systematic approach to tax management. There is no","page_number":162,"box":{"x":69,"y":808,"width":817,"height":11}},{"id":"d3ab54a6-965c-453a-99b6-7c8a6b148298","block_type":"box","text":"assurance that a Fund can or will be successful in effecting any redemptions in kind and shareholders should expect","page_number":162,"box":{"x":69,"y":823,"width":833,"height":12}},{"id":"b4db938e-f8a0-44cf-84e1-6231b8091e6b","block_type":"box","text":"that each Fund will distribute capital gains.","page_number":162,"box":{"x":68,"y":839,"width":305,"height":11}},{"id":"d90e9102-6744-44a4-bee9-ef25850e00bd","block_type":"box","text":"Certain Funds may invest in derivative contracts such as options, futures contracts, forward contracts and swap","page_number":162,"box":{"x":102,"y":861,"width":799,"height":11}},{"id":"67fba8aa-c031-4e90-aa4d-69d5ceca1b43","block_type":"box","text":"agreements. The U.S. federal income tax treatment of a derivative contract may not be as favorable as a direct","page_number":162,"box":{"x":69,"y":876,"width":791,"height":11}},{"id":"45ba3078-5e39-4192-9f2f-3e21180cf7c6","block_type":"box","text":"investment in the underlying security and may adversely affect the timing, character and amount of income the Fund","page_number":162,"box":{"x":70,"y":891,"width":826,"height":12}},{"id":"5fc71712-692d-4359-b1c0-c8521f79626d","block_type":"box","text":"realizes from its investments. As a result, a larger portion of the Fund’s distributions may be treated as ordinary","page_number":162,"box":{"x":69,"y":906,"width":803,"height":12}},{"id":"03f7c517-c5c8-439f-a8fe-c18a242428ad","block_type":"box","text":"II-131","page_number":162,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"efb882ce-3294-4f5b-8c05-ff72a8e65f99","block_type":"box","text":"NM0926U-5977317-162/232","page_number":162,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"1750557a-ed15-41a6-9494-d4ea3568a885","block_type":"box","text":"income rather than capital gains. In addition, section 1256 contracts held by a Fund at the end of each taxable year","page_number":163,"box":{"x":70,"y":45,"width":825,"height":11}},{"id":"592de1d3-5725-4946-bbc5-4d227432b94f","block_type":"box","text":"(and, for purposes of the 4% excise tax, certain other dates as prescribed under the Code) are generally “marked-to","page_number":163,"box":{"x":69,"y":60,"width":829,"height":11}},{"id":"e2d53d81-339b-4126-ac96-58a03283eb74","block_type":"box","text":"market,” such that unrealized gains or losses are treated as though they were realized (with such gain or loss being","page_number":163,"box":{"x":69,"y":75,"width":826,"height":11}},{"id":"d291957e-5b5d-4846-8d84-a0ff89874ff1","block_type":"box","text":"considered 60% long-term and 40% short-term capital gain or loss), which may increase the amount that must be","page_number":163,"box":{"x":69,"y":90,"width":808,"height":11}},{"id":"271d3d0e-7b71-48fb-8f37-a2d2d81b3f47","block_type":"box","text":"distributed to meet distribution requirements and avoid the excise tax. In addition, the tax treatment of certain","page_number":163,"box":{"x":69,"y":105,"width":787,"height":11}},{"id":"f15015bd-d735-4ac2-9afc-f7cd2896e7f2","block_type":"box","text":"derivative contracts, such as swap agreements, is unsettled and may be subject to future legislation, regulation or","page_number":163,"box":{"x":69,"y":120,"width":816,"height":12}},{"id":"ef79d7c1-cfec-4886-825d-f88a91f2c4f5","block_type":"box","text":"administrative pronouncements issued by the IRS. If such future guidance limits the Fund’s ability to use derivatives,","page_number":163,"box":{"x":69,"y":135,"width":832,"height":12}},{"id":"490242d4-1b76-422c-a46b-41d4ebedf6d5","block_type":"box","text":"the Fund may have to find other ways of achieving its investment objectives.","page_number":163,"box":{"x":68,"y":150,"width":542,"height":12}},{"id":"e56f0d04-9fa1-4f95-8da4-f36269622f89","block_type":"box","text":"Certain swap agreements, including exchange-traded swap agreements, are treated as notional principal","page_number":163,"box":{"x":102,"y":173,"width":744,"height":11}},{"id":"c18a56c8-b474-4915-ba35-a1d8bbb66017","block_type":"box","text":"contracts rather than as section 1256 contracts. This can affect the type of income earned by such swap","page_number":163,"box":{"x":69,"y":188,"width":751,"height":11}},{"id":"ede25c4d-fdaf-44df-8955-67967a61fb98","block_type":"box","text":"agreements since all the income on a notional principal contract may be ordinary income, whereas 40% of the gain","page_number":163,"box":{"x":69,"y":203,"width":819,"height":12}},{"id":"7c7cf7b3-b70b-4a59-b67a-33b5d5e064ee","block_type":"box","text":"on a section 1256 contract is treated as short-term capital gain taxed at ordinary rates and 60% is treated as long","page_number":163,"box":{"x":69,"y":219,"width":823,"height":11}},{"id":"1eb8cef7-988b-4f95-a6c6-c5005635c50e","block_type":"box","text":"term capital gain taxed at more favorable rates when distributed to shareholders. The rest is long-term capital gain,","page_number":163,"box":{"x":68,"y":234,"width":823,"height":11}},{"id":"db7c2693-21bb-40c9-80d9-5c682ca0310a","block_type":"box","text":"which may be taxable at more favorable rates than ordinary income. Proposed regulations interpret what types of","page_number":163,"box":{"x":68,"y":249,"width":807,"height":11}},{"id":"aab99510-5a8a-420a-980b-c053e3111a7e","block_type":"box","text":"swap agreements are to be treated as notional principal contracts rather than as section 1256 contracts. When","page_number":163,"box":{"x":69,"y":264,"width":797,"height":11}},{"id":"3dd64566-a387-443e-80aa-138b7752ae15","block_type":"box","text":"finalized, these regulations could result in the Fund having to treat more of its income on swap agreements and more","page_number":163,"box":{"x":68,"y":279,"width":838,"height":11}},{"id":"d5918927-1d11-45b9-b739-e639ef71bd49","block_type":"box","text":"of the distributions made to shareholders as ordinary income and less as long-term capital gains.","page_number":163,"box":{"x":69,"y":294,"width":695,"height":11}},{"id":"3bba1435-9e94-4f82-84e2-8c28fd4dbac8","block_type":"box","text":"Certain Funds may invest in zero coupon U.S. Treasury bonds and other debt securities that are issued at a","page_number":163,"box":{"x":102,"y":317,"width":768,"height":11}},{"id":"9b9852f1-38ea-4c94-a709-b7aab11d6a74","block_type":"box","text":"discount or provide for deferred interest. Even though a Fund receives no actual interest payments on these","page_number":163,"box":{"x":69,"y":332,"width":769,"height":11}},{"id":"d63035db-f088-4c0f-87bc-334804dd5577","block_type":"box","text":"securities, it will be deemed to receive income equal, generally, to a portion of the excess of the stated redemption","page_number":163,"box":{"x":69,"y":347,"width":822,"height":11}},{"id":"9e51cba8-e136-410b-9139-7144876d8d2c","block_type":"box","text":"price of the securities over their issue price (“original issue discount”) each year that the securities are held. Since","page_number":163,"box":{"x":70,"y":362,"width":819,"height":11}},{"id":"364221ee-0f54-4f1a-b7b8-4e0141a50f88","block_type":"box","text":"the original issue discount income earned by a Fund in a taxable year may not be represented by cash income, the","page_number":163,"box":{"x":68,"y":377,"width":818,"height":12}},{"id":"d7ba7115-568b-4ea5-911f-73515f9f5c89","block_type":"box","text":"Fund may have to dispose of securities, which it might otherwise have continued to hold, or borrow to generate cash","page_number":163,"box":{"x":70,"y":392,"width":830,"height":12}},{"id":"a9bec066-12c9-48f7-b3a1-254e27f61ba9","block_type":"box","text":"in order to satisfy its distribution requirements. In addition, a Fund’s investment in foreign currencies or foreign","page_number":163,"box":{"x":70,"y":407,"width":792,"height":12}},{"id":"b6233120-3f8d-460d-96f4-c1d2ebaf0767","block_type":"box","text":"currency denominated or referenced debt securities, certain asset-backed securities and contingent payment and","page_number":163,"box":{"x":69,"y":423,"width":808,"height":11}},{"id":"16936347-8a5f-4ead-ade1-d2bda928ffc8","block_type":"box","text":"inflation-indexed debt instruments also may increase or accelerate the Fund’s recognition of income, including the","page_number":163,"box":{"x":70,"y":438,"width":812,"height":11}},{"id":"b2ecc160-8a80-43a9-a09d-ae329a2d8776","block_type":"box","text":"recognition of taxable income in excess of cash generated by such investments. Any transaction by the Fund in","page_number":163,"box":{"x":69,"y":453,"width":789,"height":11}},{"id":"cb776a91-f917-4e28-85f9-17e149e4f0d1","block_type":"box","text":"foreign currencies, foreign currency-denominated debt obligations or certain foreign currency options, futures","page_number":163,"box":{"x":68,"y":468,"width":777,"height":11}},{"id":"99dd9d2d-55d8-4632-9f1e-12e6227b7093","block_type":"box","text":"contracts or forward contracts (or similar instruments) may give rise to ordinary income or loss to the extent such","page_number":163,"box":{"x":69,"y":483,"width":810,"height":11}},{"id":"0ed2c19d-c30a-4005-aa16-cd6687a0f790","block_type":"box","text":"income or loss results from fluctuations in the value of the foreign currency concerned. Any such net gains could","page_number":163,"box":{"x":70,"y":498,"width":801,"height":11}},{"id":"aeac7660-5063-4b9f-93b0-b6c4114201ba","block_type":"box","text":"require a larger dividend toward the end of the calendar year. Any such net losses will generally reduce and","page_number":163,"box":{"x":69,"y":513,"width":762,"height":12}},{"id":"417468d8-aa00-4180-8267-ec8212421951","block_type":"box","text":"potentially require the recharacterization of prior ordinary income distributions. Such ordinary income treatment may","page_number":163,"box":{"x":70,"y":528,"width":827,"height":12}},{"id":"e703258f-6df3-408e-83ae-5d4ad1d302d7","block_type":"box","text":"accelerate Fund distributions to shareholders and increase the distributions taxed to shareholders as ordinary","page_number":163,"box":{"x":69,"y":544,"width":787,"height":11}},{"id":"93f88c4d-9b61-4ea8-9258-e365074b33ce","block_type":"box","text":"income. Any net ordinary losses so created cannot be carried forward by the Fund to offset income or gains earned","page_number":163,"box":{"x":70,"y":559,"width":822,"height":11}},{"id":"fb045e9f-6e17-49d7-83d9-7e9d1e60ab10","block_type":"box","text":"in subsequent taxable years.","page_number":163,"box":{"x":70,"y":574,"width":203,"height":11}},{"id":"6fa9e055-1ca7-44df-9cb4-c46bb5820851","block_type":"box","text":"Ordinary income dividends paid to shareholders who are nonresident aliens or foreign entities (other than pass","page_number":163,"box":{"x":102,"y":596,"width":795,"height":12}},{"id":"97751ad3-03c2-4344-a44c-0e3189d5ab79","block_type":"box","text":"through entities to the extent owned by U.S. persons) generally will be subject to a 30% U.S. withholding tax under","page_number":163,"box":{"x":68,"y":612,"width":816,"height":11}},{"id":"fcba5f7a-2feb-45a3-bd70-b188327892cf","block_type":"box","text":"existing provisions of the Code applicable to foreign individuals and entities unless a reduced rate of withholding or a","page_number":163,"box":{"x":69,"y":627,"width":835,"height":11}},{"id":"35aea800-f0d2-4dbb-953e-bb02da31344c","block_type":"box","text":"withholding exemption is provided under applicable treaty law. Capital gain dividends paid to shareholders that are","page_number":163,"box":{"x":68,"y":642,"width":815,"height":11}},{"id":"e00422aa-1903-4e36-8e59-18bc1bf26563","block_type":"box","text":"nonresident aliens or foreign entities, if and to the extent properly reported as capital gain dividends, generally will","page_number":163,"box":{"x":69,"y":657,"width":816,"height":11}},{"id":"608b27d1-e580-4e0e-a304-80110dbeadbd","block_type":"box","text":"not be subject to a 30% withholding tax, unless certain exceptions apply. Dividends derived by a regulated investment","page_number":163,"box":{"x":69,"y":672,"width":840,"height":11}},{"id":"738f353d-d41c-4471-8a60-c64a52d755fd","block_type":"box","text":"company from short-term capital gains and qualified net interest income (including income from original issue","page_number":163,"box":{"x":69,"y":687,"width":781,"height":11}},{"id":"b948abf7-9bab-4eda-a56d-54c92ed991f1","block_type":"box","text":"discount and market discount) and paid to shareholders who are nonresident aliens or foreign entities, if and to the","page_number":163,"box":{"x":69,"y":702,"width":824,"height":12}},{"id":"4bb9dad3-085d-4838-a6d8-0209b45ca872","block_type":"box","text":"extent properly reported as “short-term capital gain dividends” or “interest-related dividends”, respectively, generally","page_number":163,"box":{"x":69,"y":718,"width":832,"height":11}},{"id":"a6fb4957-2322-432c-b966-66675024a0a8","block_type":"box","text":"will not be subject to U.S. withholding tax. Where possible, the Funds intend to report such dividends as interest","page_number":163,"box":{"x":68,"y":733,"width":808,"height":11}},{"id":"cedc679e-3e5b-4202-aee3-ce305d0c4d25","block_type":"box","text":"related dividends or short-term capital gain dividends. However, depending on its circumstances, a Fund may report","page_number":163,"box":{"x":69,"y":748,"width":826,"height":11}},{"id":"bcb7b078-b82a-4d0c-8a22-894010339d3d","block_type":"box","text":"all, some or none of its potentially eligible dividends as interest-related or as short-term capital gain dividends, and/","page_number":163,"box":{"x":69,"y":763,"width":830,"height":11}},{"id":"690d0a8f-4a96-4942-8c3a-da92e253e847","block_type":"box","text":"or treat such dividends, in whole or in part, as ineligible for this exemption from withholding. In order to qualify for","page_number":163,"box":{"x":69,"y":778,"width":811,"height":11}},{"id":"30166f2b-75af-47dd-8b65-541bb9cdb00f","block_type":"box","text":"this exemption from withholding, a foreign shareholder must comply with applicable certification requirements","page_number":163,"box":{"x":68,"y":793,"width":784,"height":11}},{"id":"63cb8057-30ea-4dd3-acdc-a8f0ceab8a1c","block_type":"box","text":"relating to its foreign status (including, in general, furnishing an IRS Form W-8BEN, IRS Form W-8BEN-E or substitute","page_number":163,"box":{"x":69,"y":808,"width":828,"height":11}},{"id":"e4ce8db5-0708-4091-bfd6-4d1d3f16b56c","block_type":"box","text":"Form). In the case of shares held through an intermediary, the intermediary may withhold even if the Fund reports the","page_number":163,"box":{"x":70,"y":823,"width":839,"height":12}},{"id":"c9e07e72-d131-4ca9-8f17-c0f285dff3d5","block_type":"box","text":"payment as an interest-related or short-term capital gain dividend. Foreign shareholders should contact their","page_number":163,"box":{"x":70,"y":839,"width":772,"height":11}},{"id":"fdd78f84-1c0f-4c99-bb0b-bfaa51cf2bcc","block_type":"box","text":"intermediaries with respect to the application of these rules to their accounts. It is not possible to predict what","page_number":163,"box":{"x":70,"y":853,"width":791,"height":11}},{"id":"4264d974-752e-4b67-ad62-b534a62cfbb5","block_type":"box","text":"portion, if any, of a Fund’s distributions will be reported as interest-related dividends or short-term capital gain","page_number":163,"box":{"x":70,"y":869,"width":787,"height":11}},{"id":"b2cb174b-3ceb-4bcf-8eea-40d587355a92","block_type":"box","text":"dividends under these rules.","page_number":163,"box":{"x":69,"y":884,"width":201,"height":9}},{"id":"f6a5232c-512f-4b43-a392-79378774c10f","block_type":"box","text":"II-132","page_number":163,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"1ec8c80e-e4e8-42b5-9235-1810081ed548","block_type":"box","text":"NM0926U-5977317-163/232","page_number":163,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"f7db11c2-beb6-4138-90e6-1333dbf35f67","block_type":"box","text":"Distributions to certain foreign shareholders by a Fund at least 50% of the assets of which are “U.S. real","page_number":164,"box":{"x":102,"y":45,"width":747,"height":11}},{"id":"f9f3fce6-912b-4b17-8953-493c6b49fa85","block_type":"box","text":"property interests” (as defined in the Code and Treasury regulations) at any time during the five-year period ending on","page_number":164,"box":{"x":70,"y":60,"width":838,"height":11}},{"id":"b8aa0f5e-dd56-4ac9-9878-9c1128dd3def","block_type":"box","text":"the date of the distributions, to the extent the distributions are attributable to gains from sales or exchanges of U.S.","page_number":164,"box":{"x":68,"y":75,"width":829,"height":11}},{"id":"2992337d-d5ba-4f1f-bba2-d0cc35b1a55c","block_type":"box","text":"real property interests (including shares in certain “U.S. real property holding corporations” such as certain REITs,","page_number":164,"box":{"x":69,"y":90,"width":817,"height":11}},{"id":"09391d3b-9e40-4cdd-94ee-ffc733e0a084","block_type":"box","text":"although exceptions may apply if any class of stock of such a corporation is regularly traded on an established","page_number":164,"box":{"x":69,"y":105,"width":786,"height":11}},{"id":"b3753714-aa03-4755-aa68-f417a2940667","block_type":"box","text":"securities market and the Fund has held no more than 5% of such class of stock at all times during the five-year","page_number":164,"box":{"x":69,"y":120,"width":800,"height":12}},{"id":"0b61c6fe-a599-4573-b159-647aeef7a4ee","block_type":"box","text":"period ending on the date of the distributions), generally must be treated by such foreign shareholders as income","page_number":164,"box":{"x":70,"y":135,"width":807,"height":12}},{"id":"ba6698a6-3d03-4d84-a246-9d49fb025691","block_type":"box","text":"effectively connected to a trade or business within the United States, which is generally subject to tax at the","page_number":164,"box":{"x":69,"y":150,"width":772,"height":12}},{"id":"516dcefd-ebee-431e-9a67-396e897c6d50","block_type":"box","text":"graduated rates applicable to U.S. shareholders, except for distributions to foreign shareholders that held no more","page_number":164,"box":{"x":68,"y":166,"width":818,"height":11}},{"id":"721a8359-2521-424a-b2a1-a969b1858ecc","block_type":"box","text":"than 5% of any class of stock of the Fund at all times during the previous one-year period ending on the date of the","page_number":164,"box":{"x":68,"y":181,"width":820,"height":11}},{"id":"34f9a350-c1cd-4a00-a777-96b4a2eb575a","block_type":"box","text":"distributions. Such distributions will be subject to U.S. income and withholding tax and generally will require a foreign","page_number":164,"box":{"x":69,"y":196,"width":833,"height":11}},{"id":"bcf3d28e-0e5e-4b91-8c50-014df22b19a7","block_type":"box","text":"shareholder to file a U.S. federal income tax return. If the foreign shareholder held no more than 5% of any class of","page_number":164,"box":{"x":69,"y":211,"width":823,"height":11}},{"id":"ea2e9754-ea0b-4c36-9c6b-2980efb1bf0f","block_type":"box","text":"stock of the Fund at all times during the previous one-year period ending on the date of the distributions, the","page_number":164,"box":{"x":69,"y":226,"width":774,"height":11}},{"id":"0021b034-f6bc-4a25-816f-4cd81b93237b","block_type":"box","text":"distributions will be taxable as ordinary dividends and subject to withholding at a 30% or lower treaty rate. In addition,","page_number":164,"box":{"x":69,"y":241,"width":839,"height":11}},{"id":"c5771876-ff49-4e51-bfc2-15d5c4062c0f","block_type":"box","text":"sales or redemptions of shares held by certain foreign shareholders in such a Fund generally will be subject to U.S.","page_number":164,"box":{"x":69,"y":256,"width":822,"height":12}},{"id":"0901d059-d3b5-4bec-aad0-7a75a7a0df76","block_type":"box","text":"income and withholding tax and generally will require the foreign shareholder to file a U.S. federal income tax return,","page_number":164,"box":{"x":70,"y":271,"width":827,"height":12}},{"id":"2999e703-791b-4233-967b-5acac132b875","block_type":"box","text":"although exceptions may apply if more than 50% of the value of the Fund’s shares are held by U.S. shareholders or","page_number":164,"box":{"x":69,"y":286,"width":823,"height":12}},{"id":"1b8f5289-b538-4a4f-b940-665c937b949c","block_type":"box","text":"the foreign shareholder selling or redeeming the shares has held no more than 5% of any class of stock of the Fund","page_number":164,"box":{"x":68,"y":302,"width":827,"height":11}},{"id":"5e2d82bf-b76e-4259-b29c-1ec466b0c756","block_type":"box","text":"at all times during the five-year period ending on the date of the sale or redemption.","page_number":164,"box":{"x":69,"y":317,"width":596,"height":11}},{"id":"529e117d-fe63-47d7-b15e-42f09d7ef2ed","block_type":"box","text":"Provided that more than 50% of the value of a Fund’s stock is held by U.S. shareholders, redemptions and other","page_number":164,"box":{"x":102,"y":339,"width":802,"height":12}},{"id":"091314ab-44f9-433b-b7bd-72e0584e0a97","block_type":"box","text":"distributions made in the form of U.S. real property interests (including shares in certain “U.S. real property holding","page_number":164,"box":{"x":69,"y":355,"width":827,"height":11}},{"id":"a122dbec-f1f4-4b2f-82d3-14857d8847e2","block_type":"box","text":"corporations”, although exceptions may apply if any class of stock of such a corporation is regularly traded on an","page_number":164,"box":{"x":69,"y":370,"width":804,"height":11}},{"id":"e8642c4f-258b-4e67-a832-3c5863da6995","block_type":"box","text":"established securities market and the Fund has held no more than 5% of such class of stock at all times during the","page_number":164,"box":{"x":69,"y":385,"width":824,"height":11}},{"id":"ca9688c8-98c1-4320-b1bf-4869fd30edc1","block_type":"box","text":"five-year period ending on the date of the distribution) generally will cause the Fund to recognize a portion of any","page_number":164,"box":{"x":68,"y":400,"width":801,"height":11}},{"id":"1a9f3ed5-b4de-4192-9630-456e57d80c04","block_type":"box","text":"unrecognized gain in the U.S. real property interests equal to the product of (i) the excess of fair market value of","page_number":164,"box":{"x":69,"y":415,"width":803,"height":11}},{"id":"9d9d0135-5602-4e2c-a67c-e00bdc606059","block_type":"box","text":"such U.S. real property interests over the Fund’s adjusted bases in such interests and (ii) the greatest foreign","page_number":164,"box":{"x":69,"y":430,"width":785,"height":11}},{"id":"4f4553ec-dbcc-47a4-b75e-2fc5064297c7","block_type":"box","text":"ownership percentage of the Fund during the five-year period ending on the date of distribution.","page_number":164,"box":{"x":69,"y":445,"width":676,"height":12}},{"id":"b9e87c9b-7daa-4482-9b0e-91526c0095cd","block_type":"box","text":"A foreign shareholder may also be subject to certain “wash sale” rules to prevent the avoidance of the tax filing","page_number":164,"box":{"x":101,"y":468,"width":798,"height":11}},{"id":"bd91c0b1-8a73-45bc-bd6e-1e474cf67585","block_type":"box","text":"and payment obligations discussed above through the sale and repurchase of Fund shares.","page_number":164,"box":{"x":69,"y":483,"width":651,"height":11}},{"id":"e67420ff-a17a-4b62-aea5-30334d00fdda","block_type":"box","text":"Shareholders that are nonresident aliens or foreign entities are urged to consult their own tax advisors","page_number":164,"box":{"x":102,"y":506,"width":731,"height":11}},{"id":"e09f76c3-8cc9-4419-8a28-bbb906462c6e","block_type":"box","text":"concerning the particular tax consequences to them of an investment in a Fund.","page_number":164,"box":{"x":69,"y":521,"width":570,"height":11}},{"id":"5a366dbe-53c9-4a68-9466-e52705ca3ca3","block_type":"box","text":"Separately, a 30% withholding tax is currently imposed on U.S.-source dividends, interest and other income","page_number":164,"box":{"x":102,"y":544,"width":763,"height":11}},{"id":"7364c932-5595-41c3-9681-14e6eef929ab","block_type":"box","text":"items paid to (i) certain foreign financial institutions and investment funds, and (ii) certain other foreign entities. To","page_number":164,"box":{"x":70,"y":559,"width":820,"height":11}},{"id":"c36852ef-bcda-4c92-bad9-eca9e38df133","block_type":"box","text":"avoid withholding, foreign financial institutions and investment funds will generally either need to (a) collect and","page_number":164,"box":{"x":69,"y":574,"width":794,"height":11}},{"id":"d90b0f0a-a2c8-4341-88a5-5d7bf4f0251f","block_type":"box","text":"report to the IRS detailed information identifying their U.S. accounts and U.S. account holders, comply with due","page_number":164,"box":{"x":69,"y":589,"width":794,"height":11}},{"id":"667a99c4-2a0d-45ba-a63a-302c343f8087","block_type":"box","text":"diligence procedures for identifying U.S. accounts and withhold tax on certain payments made to noncomplying","page_number":164,"box":{"x":69,"y":604,"width":791,"height":11}},{"id":"26e1d024-130b-41e5-ac4d-f7cff5c2a084","block_type":"box","text":"foreign entities and account holders or (b) if an intergovernmental agreement is entered into and implementing","page_number":164,"box":{"x":68,"y":619,"width":791,"height":11}},{"id":"992057ea-4f7a-40e6-9bed-ed33864de3c2","block_type":"box","text":"legislation is adopted, comply with the agreement and legislation. Other foreign entities will generally either need to","page_number":164,"box":{"x":70,"y":634,"width":822,"height":12}},{"id":"cbc6abc9-0b67-4975-aacc-c972bae74001","block_type":"box","text":"provide detailed information identifying each substantial U.S. owner or certify there are no such owners.","page_number":164,"box":{"x":70,"y":649,"width":739,"height":12}},{"id":"857ccb55-cb29-4890-8dce-af3078a9ab97","block_type":"box","text":"Under certain provisions of the Code, some shareholders may be subject to a 24% withholding tax on ordinary","page_number":164,"box":{"x":102,"y":672,"width":786,"height":11}},{"id":"6094a5fd-1222-4f8e-adf2-ba0d5e1f7d4e","block_type":"box","text":"income dividends, capital gain dividends and redemption payments (“backup withholding”). Generally, shareholders","page_number":164,"box":{"x":70,"y":687,"width":820,"height":11}},{"id":"06e1e892-7c5a-4d52-8502-598b4526e572","block_type":"box","text":"subject to backup withholding will be non-corporate shareholders for whom no certified taxpayer identification number","page_number":164,"box":{"x":69,"y":702,"width":837,"height":12}},{"id":"fe534209-eae0-4577-935c-fb2008161ff4","block_type":"box","text":"is on file with the Fund or who, to the Fund’s knowledge, have furnished an incorrect number. When establishing an","page_number":164,"box":{"x":70,"y":717,"width":821,"height":12}},{"id":"302b6c2a-e952-43f6-908c-6a8e6083db55","block_type":"box","text":"account, an investor must certify under penalty of perjury that such number is correct and that such investor is not","page_number":164,"box":{"x":69,"y":732,"width":819,"height":12}},{"id":"49e11726-dcd4-434b-908a-2db984984808","block_type":"box","text":"otherwise subject to backup withholding. Backup withholding is not an additional tax. Any amount withheld generally","page_number":164,"box":{"x":69,"y":748,"width":826,"height":11}},{"id":"dafb75e3-d3ec-41a5-b797-5ea2ba63aaa3","block_type":"box","text":"may be allowed as a refund or a credit against a shareholder’s U.S. federal income tax liability, provided that the","page_number":164,"box":{"x":69,"y":763,"width":802,"height":11}},{"id":"250f0cce-e197-4e9d-8247-b5eaa9e693cb","block_type":"box","text":"required information is timely forwarded to the IRS.","page_number":164,"box":{"x":69,"y":778,"width":364,"height":11}},{"id":"2a3fb80a-ebcc-46a2-bbf1-01711013a24a","block_type":"box","text":"If a shareholder recognizes a loss with respect to a Fund’s shares of at least $2 million in any single taxable","page_number":164,"box":{"x":102,"y":800,"width":774,"height":12}},{"id":"02ad15d6-3768-469c-ba6b-10c441100072","block_type":"box","text":"year or $4 million in any combination of taxable years for an individual shareholder or $10 million in any single","page_number":164,"box":{"x":68,"y":815,"width":787,"height":12}},{"id":"21013061-ecac-49b8-bfd6-c0773144a78d","block_type":"box","text":"taxable year or $20 million in any combination of taxable years for a corporate shareholder in any single taxable year,","page_number":164,"box":{"x":68,"y":830,"width":835,"height":12}},{"id":"e0eaccd0-8f30-4044-b02c-ed7640eac731","block_type":"box","text":"the shareholder must file a disclosure statement on IRS Form 8886 with the IRS. Direct shareholders of portfolio","page_number":164,"box":{"x":68,"y":846,"width":809,"height":11}},{"id":"1ed6fc97-984c-4ef0-93ec-a0c19888148d","block_type":"box","text":"securities are in many cases exempted. That a loss is reportable under these regulations does not affect the legal","page_number":164,"box":{"x":69,"y":861,"width":817,"height":11}},{"id":"f5c7d0fe-0c4b-48bd-bfac-8446533b2eb3","block_type":"box","text":"determination of whether the taxpayer’s treatment of the loss is proper. Shareholders should consult their tax","page_number":164,"box":{"x":69,"y":876,"width":783,"height":11}},{"id":"27707685-4560-40db-8566-95164293b01e","block_type":"box","text":"advisors to determine the applicability of these regulations in light of their individual circumstances.","page_number":164,"box":{"x":69,"y":891,"width":710,"height":12}},{"id":"542644fe-7a57-4903-8023-d0fcb0733cd9","block_type":"box","text":"II-133","page_number":164,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"e1149961-53a0-4711-af4f-8ccf4ae4fb27","block_type":"box","text":"NM0926U-5977317-164/232","page_number":164,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"9211f3a9-818c-4b70-bbb1-957a77d58bba","block_type":"box","text":"Certain types of income received by a Fund from REITs, real estate mortgage investment conduits, taxable","page_number":165,"box":{"x":102,"y":45,"width":758,"height":11}},{"id":"1c99e8d5-4078-4d26-a2ce-324fa07b10a3","block_type":"box","text":"mortgage pools or other investments may cause the Fund to report some or all of its distributions as “excess","page_number":165,"box":{"x":69,"y":60,"width":782,"height":11}},{"id":"730d14e7-e728-41d8-bfb2-6a470fd1974c","block_type":"box","text":"inclusion income.” To Fund shareholders, such excess inclusion income may: (i) constitute taxable income, as","page_number":165,"box":{"x":70,"y":75,"width":783,"height":11}},{"id":"fe3813d0-0146-4244-be70-66074c0953f6","block_type":"box","text":"unrelated business taxable income (“UBTI”) for those shareholders who would otherwise be tax-exempt such as","page_number":165,"box":{"x":69,"y":90,"width":797,"height":11}},{"id":"9e382137-98cf-4a7c-b604-ea060f11d864","block_type":"box","text":"individual retirement accounts, 401(k) accounts, Keogh plans, pension plans and certain charitable entities; (ii) not","page_number":165,"box":{"x":70,"y":105,"width":822,"height":11}},{"id":"7ad2a8a2-380b-4e37-a262-71b77ce027e6","block_type":"box","text":"be offset by otherwise allowable deductions for tax purposes; (iii) not be eligible for reduced U.S. withholding for non","page_number":165,"box":{"x":69,"y":120,"width":836,"height":12}},{"id":"b65b746b-2ddb-4723-a3ae-afb92f050afa","block_type":"box","text":"U.S. shareholders even from tax treaty countries; and (iv) cause the Fund to be subject to tax if certain “disqualified","page_number":165,"box":{"x":70,"y":135,"width":826,"height":11}},{"id":"349940b0-aef9-4fb0-9ec4-4e3300ba73b1","block_type":"box","text":"organizations,” as defined by the Code, are Fund shareholders. The Fund tries to avoid investing in REITs that are","page_number":165,"box":{"x":69,"y":150,"width":808,"height":12}},{"id":"719fab16-08aa-41d9-846d-eee5dcf54f57","block_type":"box","text":"expected to generate excess inclusion income, but the Fund may not always be successful in doing so. Because","page_number":165,"box":{"x":69,"y":166,"width":800,"height":11}},{"id":"46c7b38b-1c50-46c4-af33-a42d920ced69","block_type":"box","text":"information about a REIT’s investments may be inadequate or inaccurate, or because a REIT may change its","page_number":165,"box":{"x":70,"y":181,"width":770,"height":11}},{"id":"ce0b0dda-0939-4d1e-9ab9-ef23f35440bd","block_type":"box","text":"investment program, the Fund may not be successful in avoiding the consequences described above. Avoidance of","page_number":165,"box":{"x":70,"y":196,"width":816,"height":11}},{"id":"db448b46-1092-411e-84c8-2a2419fdf6f2","block_type":"box","text":"investments in REITs that generate excess inclusion income may require the Fund to forego otherwise attractive","page_number":165,"box":{"x":70,"y":211,"width":796,"height":11}},{"id":"6560cdcf-6043-4747-a7a1-fc89af721891","block_type":"box","text":"investment opportunities.","page_number":165,"box":{"x":70,"y":226,"width":180,"height":11}},{"id":"146e2f83-d148-4d7a-8171-7545d544fc83","block_type":"box","text":"Dividends and interest received and capital gains realized by a Fund may give rise to withholding and other taxes","page_number":165,"box":{"x":102,"y":249,"width":801,"height":11}},{"id":"42a40032-4f4a-4dfa-bd8e-f27b4b88427e","block_type":"box","text":"imposed by foreign countries. Tax conventions between certain foreign countries and the United States may reduce or","page_number":165,"box":{"x":70,"y":264,"width":839,"height":11}},{"id":"9bf33e59-2dad-4c4a-a3c5-4e1c056d90e7","block_type":"box","text":"eliminate such taxes. Shareholders of a Fund more than 50% by value of the assets of which at the close of a taxable","page_number":165,"box":{"x":69,"y":279,"width":840,"height":11}},{"id":"3c36e416-969c-4148-a01c-bdd31997b4ba","block_type":"box","text":"year are foreign securities may be able to claim U.S. foreign tax credits with respect to such foreign taxes paid by the","page_number":165,"box":{"x":68,"y":294,"width":837,"height":11}},{"id":"e88567bf-649e-42e0-b30d-769ded60181f","block_type":"box","text":"Fund, subject to certain requirements and limitations contained in the Code. For example, certain retirement","page_number":165,"box":{"x":70,"y":309,"width":774,"height":11}},{"id":"8dd55e4d-e946-4fb9-bd76-8e2890e97e5a","block_type":"box","text":"accounts and certain tax-exempt organizations cannot claim foreign tax credits on investments in foreign securities","page_number":165,"box":{"x":69,"y":324,"width":820,"height":12}},{"id":"388ac78b-2301-4c01-989b-a98c1b56b952","block_type":"box","text":"held in a Fund. In addition, a foreign tax credit may be claimed with respect to withholding tax on payments with","page_number":165,"box":{"x":69,"y":339,"width":795,"height":12}},{"id":"d0b8912c-3d80-4223-ba6b-caaad7861448","block_type":"box","text":"respect to a security only if the holder of the security meets certain holding period requirements. Both the","page_number":165,"box":{"x":69,"y":355,"width":755,"height":11}},{"id":"d5cd1c0b-687d-4875-a9fd-28a423d7dca1","block_type":"box","text":"shareholder and the Fund must meet these holding period requirements, and if a Fund fails to do so, it will not be","page_number":165,"box":{"x":69,"y":370,"width":811,"height":11}},{"id":"4e42f784-b5a2-4e2b-9353-d9bf12421868","block_type":"box","text":"able to “pass through” to shareholders the ability to claim a credit or a deduction for the related foreign taxes paid by","page_number":165,"box":{"x":69,"y":385,"width":839,"height":11}},{"id":"0c776cc1-fb8a-4a3a-94a2-6de410be4ded","block_type":"box","text":"the Fund. Further, to the extent that a Fund engages in securities lending with respect to a security paying income","page_number":165,"box":{"x":68,"y":400,"width":812,"height":11}},{"id":"b802ef3a-f6d3-41d0-8eb0-a43c97b3db19","block_type":"box","text":"subject to foreign taxes, it may not be able to pass through to its shareholders the ability to take a foreign tax credit","page_number":165,"box":{"x":69,"y":415,"width":829,"height":11}},{"id":"f7d5fd58-8d4c-43b0-a7f1-ff528d13a876","block_type":"box","text":"for those taxes. If a Fund satisfies the applicable requirements, such Fund will be eligible to file an election with the","page_number":165,"box":{"x":68,"y":430,"width":827,"height":11}},{"id":"272558c0-2591-42cf-9979-8275da466244","block_type":"box","text":"IRS pursuant to which shareholders of the Fund will be required to include their proportionate shares of such foreign","page_number":165,"box":{"x":70,"y":445,"width":829,"height":12}},{"id":"36efc5e8-a064-4710-af2b-a36f56df2d32","block_type":"box","text":"taxes in their U.S. income tax returns as gross income, treat such proportionate shares as taxes paid by them, and","page_number":165,"box":{"x":68,"y":460,"width":825,"height":12}},{"id":"cbca0f92-cee0-47d0-9888-c5b44bb13f89","block_type":"box","text":"deduct such proportionate shares in computing their taxable incomes or, alternatively, use them as foreign tax","page_number":165,"box":{"x":69,"y":475,"width":788,"height":12}},{"id":"0702f006-ff60-412e-8b3e-856313c253dd","block_type":"box","text":"credits against their U.S. income taxes. No deductions for foreign taxes, however, may be claimed by noncorporate","page_number":165,"box":{"x":69,"y":491,"width":818,"height":11}},{"id":"abe63b35-4bdb-4e28-b069-547d22bfd58a","block_type":"box","text":"shareholders who do not itemize deductions. A shareholder that is a nonresident alien individual or a foreign","page_number":165,"box":{"x":69,"y":506,"width":773,"height":11}},{"id":"bf229607-ad80-41d2-a913-6c004f03e5ff","block_type":"box","text":"corporation may be subject to U.S. withholding tax on the income resulting from a Fund’s election described in this","page_number":165,"box":{"x":69,"y":521,"width":817,"height":11}},{"id":"f370c2e9-878e-4190-b82e-b1daf5343cac","block_type":"box","text":"paragraph but may not be able to claim a credit or deduction against such U.S. tax for the foreign taxes treated as","page_number":165,"box":{"x":70,"y":536,"width":814,"height":11}},{"id":"ece32783-b334-46fe-b0af-cabb40421d61","block_type":"box","text":"having been paid by such shareholder. A Fund will report annually to its shareholders the amount per share of such","page_number":165,"box":{"x":69,"y":551,"width":821,"height":11}},{"id":"9828c7bd-2773-4042-ac16-b0ad57593d99","block_type":"box","text":"foreign taxes and other information needed to claim the foreign tax credit.","page_number":165,"box":{"x":68,"y":566,"width":527,"height":11}},{"id":"dee0e315-ce59-442f-9093-f5c35f26a69f","block_type":"box","text":"Certain transactions entered into by the Funds are subject to special tax rules of the Code that may, among","page_number":165,"box":{"x":102,"y":589,"width":768,"height":11}},{"id":"14f0c821-7470-4b61-afb2-97fb451e12b0","block_type":"box","text":"other things, (a) affect the character of gains and losses realized, (b) disallow, suspend or otherwise limit the","page_number":165,"box":{"x":69,"y":604,"width":780,"height":11}},{"id":"8043b695-4332-4586-be5c-e4e7b5d28906","block_type":"box","text":"allowance of certain losses or deductions, and (c) accelerate the recognition of income without a corresponding","page_number":165,"box":{"x":69,"y":619,"width":797,"height":11}},{"id":"de638d4f-ec1f-456c-9b5a-af36ea524b7e","block_type":"box","text":"receipt of cash (with which to make the necessary distributions to satisfy distribution requirements applicable to","page_number":165,"box":{"x":69,"y":634,"width":802,"height":11}},{"id":"a8ba2da1-46de-47d1-85d4-4c950ead6602","block_type":"box","text":"regulated investment companies). Operation of these rules could, therefore, affect the character, amount and timing","page_number":165,"box":{"x":69,"y":649,"width":831,"height":12}},{"id":"9bcb6483-071a-42bc-9e80-fa48b211790d","block_type":"box","text":"of distributions to shareholders. Special tax rules also may require a Fund to mark-to-market certain types of","page_number":165,"box":{"x":69,"y":664,"width":776,"height":12}},{"id":"d1818098-5a80-40b3-8f6e-70db609185ae","block_type":"box","text":"positions in its portfolio (","page_number":165,"box":{"x":70,"y":680,"width":177,"height":11}},{"id":"53ff74a8-048e-4d50-acbc-d574c712ad49","block_type":"box","text":"i.e.","page_number":165,"box":{"x":249,"y":680,"width":20,"height":9}},{"id":"5ce40175-0359-4d14-a8ee-13b72ea12955","block_type":"box","text":", treat them as sold on the last day of the taxable year), and may result in the recognition","page_number":165,"box":{"x":272,"y":680,"width":636,"height":11}},{"id":"35dbc033-9dac-4772-bf2e-df1583b4e711","block_type":"box","text":"of income without a corresponding receipt of cash. Funds engaging in transactions affected by these provisions","page_number":165,"box":{"x":69,"y":695,"width":795,"height":11}},{"id":"460ec58b-3e15-42fc-912e-0fdd5ab8b77b","block_type":"box","text":"intend to monitor their transactions, make appropriate tax elections and make appropriate entries in their books and","page_number":165,"box":{"x":70,"y":710,"width":830,"height":11}},{"id":"beb68780-14cb-4918-881d-3867f0be9f2e","block_type":"box","text":"records to lessen the effect of these tax rules and avoid any possible disqualification from the special treatment","page_number":165,"box":{"x":69,"y":725,"width":804,"height":11}},{"id":"b04b3b35-7827-4b26-8651-49984f6c1288","block_type":"box","text":"afforded regulated investment companies under the Code.","page_number":165,"box":{"x":69,"y":740,"width":415,"height":11}},{"id":"9e5a4def-fb0a-4760-8912-ba4539d877df","block_type":"box","text":"Certain of a Fund’s investments in derivative instruments and foreign currency-denominated instruments, and","page_number":165,"box":{"x":102,"y":763,"width":781,"height":11}},{"id":"1738067c-b4ab-4d0d-a046-af0a5085eac9","block_type":"box","text":"any of the Fund’s transactions in foreign currencies and hedging activities, are likely to produce a difference between","page_number":165,"box":{"x":69,"y":778,"width":835,"height":11}},{"id":"eef38d2e-46e0-49c9-b0d8-717bc534abb9","block_type":"box","text":"its book income and the sum of its taxable income and net tax-exempt income (if any). If such a difference arises,","page_number":165,"box":{"x":70,"y":793,"width":811,"height":11}},{"id":"0fcd4e71-a0c7-43f0-865a-9ea764c4ac38","block_type":"box","text":"and the Fund’s book income is less than the sum of its taxable income and net tax-exempt income, the Fund could","page_number":165,"box":{"x":69,"y":808,"width":818,"height":11}},{"id":"8a7a26fd-f1f8-45e0-9a89-e271e8022e03","block_type":"box","text":"be required to make distributions exceeding book income to qualify as a RIC that is accorded special tax treatment","page_number":165,"box":{"x":69,"y":823,"width":820,"height":12}},{"id":"aed3c616-70ea-4176-9dde-945313e2c0aa","block_type":"box","text":"and to avoid an entity-level tax. In the alternative, if the Fund makes any distribution based on book income and such","page_number":165,"box":{"x":69,"y":838,"width":834,"height":11}},{"id":"de732b9d-c659-4da7-8dcf-9dc01c83a1b0","block_type":"box","text":"book income exceeds the sum of its taxable income (including realized capital gains) and net tax-exempt income, the","page_number":165,"box":{"x":69,"y":853,"width":833,"height":12}},{"id":"8fec9c10-1120-447a-bc0c-ca39643d1bcb","block_type":"box","text":"distribution (if any) of such excess generally will be treated as (i) a dividend to the extent of the Fund’s remaining","page_number":165,"box":{"x":69,"y":869,"width":805,"height":11}},{"id":"1dbca0ad-9e22-472b-847b-2af055fba7ce","block_type":"box","text":"II-134","page_number":165,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"28e46b77-dff4-4cb0-ab2a-83ef972fdd7c","block_type":"box","text":"NM0926U-5977317-165/232","page_number":165,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"c5fc3d1d-a5ff-493e-aeb2-2c173f84eb59","block_type":"box","text":"earnings and profits (including earnings and profits arising from tax-exempt income), (ii) thereafter, as a return of","page_number":166,"box":{"x":69,"y":45,"width":805,"height":11}},{"id":"f1ed2ebb-acd0-4ff8-a877-a2e648ccd2fb","block_type":"box","text":"capital to the extent of the recipient’s basis in its shares, and (iii) thereafter as gain from the sale or exchange of a","page_number":166,"box":{"x":69,"y":60,"width":822,"height":11}},{"id":"b26c8937-d397-4b50-ba00-27e71e4b1fe0","block_type":"box","text":"capital asset.","page_number":166,"box":{"x":69,"y":75,"width":95,"height":11}},{"id":"bbc01a12-9812-41c6-b387-9f539a519403","block_type":"box","text":"If a Fund invests in underlying funds, the Fund’s realized losses on sales of shares of underlying funds may be","page_number":166,"box":{"x":102,"y":98,"width":787,"height":11}},{"id":"8b702bed-eae3-4979-b65d-9bc7f990736a","block_type":"box","text":"indefinitely or permanently deferred as “wash sales.” Distributions of short-term capital gains by underlying funds will","page_number":166,"box":{"x":70,"y":113,"width":836,"height":11}},{"id":"f69ed463-139b-4f32-b5fa-ef54e7f6aa28","block_type":"box","text":"be recognized as ordinary income by the Fund and would not be offset by the Fund’s capital loss carryforwards, if","page_number":166,"box":{"x":69,"y":128,"width":812,"height":11}},{"id":"ac79efdd-b2b0-4d90-b39a-6ac075d45c0a","block_type":"box","text":"any. Capital loss carryforwards of underlying funds, if any, would not offset net capital gains of the Fund. Each of","page_number":166,"box":{"x":69,"y":143,"width":805,"height":11}},{"id":"1b0468d6-4aa9-45ad-b8dd-af75ef4d927d","block_type":"box","text":"these effects is caused by the Fund’s expected investment in the underlying funds and may result in distributions to","page_number":166,"box":{"x":68,"y":158,"width":829,"height":11}},{"id":"6a122ded-083f-41c8-b5cb-d77f67b6acda","block_type":"box","text":"Fund shareholders being of higher magnitudes and less likely to qualify for lower capital gain tax rates than if the","page_number":166,"box":{"x":70,"y":173,"width":803,"height":11}},{"id":"919442cb-40c4-4c4f-87bb-a7fc13b55069","block_type":"box","text":"Fund were to invest otherwise.","page_number":166,"box":{"x":70,"y":188,"width":216,"height":9}},{"id":"32fe5ee6-bb01-4127-9319-f6be56e1421f","block_type":"box","text":"A Fund may take certain positions through a wholly-owned (or majority-owned), foreign subsidiary (the","page_number":166,"box":{"x":101,"y":211,"width":721,"height":11}},{"id":"3efd1588-eaee-4118-8f69-b946d7d6dd70","block_type":"box","text":"“Subsidiary”). It is expected that the Subsidiary will be a “controlled foreign corporation” and that all of its net","page_number":166,"box":{"x":70,"y":226,"width":787,"height":11}},{"id":"f3f17fb7-531d-44d3-b4ec-6f6e0dd43b5e","block_type":"box","text":"income will be “subpart F income” for U.S. federal income tax purposes. If that is the case, the Fund will be required","page_number":166,"box":{"x":70,"y":241,"width":831,"height":11}},{"id":"2ad780f8-1f55-41e8-a24e-b26cbe67e78b","block_type":"box","text":"to report all of the Subsidiary’s net income as ordinary income regardless of whether that income would be treated","page_number":166,"box":{"x":68,"y":256,"width":823,"height":12}},{"id":"edd07ac4-968d-41cd-91db-593a78eb2d13","block_type":"box","text":"differently (for example, as capital gain) at the Subsidiary level and regardless of whether that income is distributed","page_number":166,"box":{"x":69,"y":271,"width":825,"height":12}},{"id":"b94eeb24-e301-47f1-b7a0-8c26bfd03774","block_type":"box","text":"to the Fund. (Previously taxed income will not, however, be taxable again when distributed.) If a net loss is realized by","page_number":166,"box":{"x":68,"y":286,"width":838,"height":12}},{"id":"a12ba60d-f7ee-4f03-9286-059a8e81ef5d","block_type":"box","text":"the Subsidiary in any taxable year, the loss will generally not be available to offset the Fund’s other income. It is not","page_number":166,"box":{"x":68,"y":302,"width":830,"height":11}},{"id":"d6e882a9-6150-4a53-9fd5-580665b55011","block_type":"box","text":"expected that the Subsidiary will be subject to an entity-level federal tax.","page_number":166,"box":{"x":69,"y":317,"width":515,"height":11}},{"id":"91b91208-f721-4e87-a218-1f11f29fccf4","block_type":"box","text":"If a Fund purchases shares of an investment company (or similar investment entity) organized under foreign law,","page_number":166,"box":{"x":102,"y":339,"width":798,"height":12}},{"id":"3c76ce71-b76a-4c64-a3b9-9de9ee81a9a2","block_type":"box","text":"the Fund will generally be treated as owning shares in a passive foreign investment company (“PFIC”) for U.S. federal","page_number":166,"box":{"x":68,"y":355,"width":835,"height":11}},{"id":"72072336-157d-48b0-a198-c410de2a4154","block_type":"box","text":"income tax purposes. A Fund may be subject to U.S. federal income tax, and interest charges (at the rate applicable","page_number":166,"box":{"x":70,"y":370,"width":827,"height":11}},{"id":"238a2233-8d6c-4508-8c48-de5a02abaab2","block_type":"box","text":"to tax underpayments) on tax liability treated as having been deferred with respect to certain distributions from such","page_number":166,"box":{"x":68,"y":385,"width":830,"height":11}},{"id":"1c55df46-7d59-4e46-b67b-e01493a35039","block_type":"box","text":"a company and on gain from the disposition of the shares of such a company (collectively referred to as “excess","page_number":166,"box":{"x":69,"y":400,"width":802,"height":11}},{"id":"d87055e8-8bf0-4821-b8ef-4d71c2f90d10","block_type":"box","text":"distributions”), even if such excess distributions are paid by the Fund as a dividend to its shareholders. However, a","page_number":166,"box":{"x":69,"y":415,"width":821,"height":11}},{"id":"c0187cef-318e-441c-a49c-bab803e90378","block_type":"box","text":"Fund may elect to “mark-to-market” at the end of each taxable year shares that it holds in PFICs. The election is","page_number":166,"box":{"x":70,"y":430,"width":797,"height":11}},{"id":"1ee7fed3-a646-4d6f-b55d-6900dc12c61c","block_type":"box","text":"made separately for each PFIC held and, once made, would be effective for all subsequent taxable years, unless","page_number":166,"box":{"x":69,"y":445,"width":801,"height":11}},{"id":"fb4f04af-2360-406a-a4e8-2ad2fb082eb7","block_type":"box","text":"revoked with consent from the IRS. Under this election, a Fund would recognize as ordinary income any increase in","page_number":166,"box":{"x":69,"y":460,"width":818,"height":12}},{"id":"ef533ae1-e8b9-43c9-a256-3a396fd89a04","block_type":"box","text":"the value of its shares as of the close of the taxable year over their adjusted tax basis and as ordinary loss any","page_number":166,"box":{"x":68,"y":475,"width":797,"height":12}},{"id":"c9bc014e-e356-4534-a4ee-c6ae8124c3c4","block_type":"box","text":"decrease in such value, but only to the extent of previously recognized “mark-to-market” gains. By making the mark","page_number":166,"box":{"x":69,"y":491,"width":824,"height":11}},{"id":"3e112676-3038-4d34-96e2-05c4908c6593","block_type":"box","text":"to-market election, a Fund could avoid imposition of the interest charge with respect to excess distributions from","page_number":166,"box":{"x":68,"y":506,"width":804,"height":11}},{"id":"990b139e-847e-443f-ae3f-19a2cb8efb2b","block_type":"box","text":"PFICs, but in any particular year might be required to recognize income in excess of the distributions it received from","page_number":166,"box":{"x":69,"y":521,"width":831,"height":11}},{"id":"b6ee9524-a518-4770-b4f6-3343852daf43","block_type":"box","text":"PFICs.","page_number":166,"box":{"x":69,"y":536,"width":42,"height":9}},{"id":"2f2a7331-f207-4a81-b24e-74bc6db608d5","block_type":"box","text":"If a Fund were to invest in a PFIC and elect to treat the PFIC as a “qualified electing fund” under the Code, in lieu","page_number":166,"box":{"x":102,"y":559,"width":804,"height":11}},{"id":"d08cbe95-7abe-4e9a-9756-fe177361792a","block_type":"box","text":"of the foregoing requirements, the Fund would be required to include in income each year a portion of the ordinary","page_number":166,"box":{"x":69,"y":574,"width":816,"height":11}},{"id":"f2f15e0b-379c-40ac-ad23-8f5e105de4de","block_type":"box","text":"earnings and net capital gains of the qualified electing fund, even if not distributed to the Fund, and such amounts","page_number":166,"box":{"x":69,"y":589,"width":816,"height":11}},{"id":"f5a5d16a-20bb-45b6-a161-6e72ef4f715a","block_type":"box","text":"would be subject to the 90% and excise tax distribution requirements described above. In order to make this election,","page_number":166,"box":{"x":68,"y":604,"width":840,"height":11}},{"id":"22df1f12-0c7d-48be-b967-ddc05b1ef549","block_type":"box","text":"the Fund would be required to obtain certain annual information from the PFICs in which it invests, which may be","page_number":166,"box":{"x":68,"y":619,"width":804,"height":11}},{"id":"933842f1-d1d6-402b-892f-fff876dd20e9","block_type":"box","text":"difficult or impossible to obtain.","page_number":166,"box":{"x":69,"y":634,"width":225,"height":11}},{"id":"188e6522-5b4e-41d9-8ccd-6ff44f340efe","block_type":"box","text":"In certain situations, a Fund may, for a taxable year, defer all or a portion of its net capital loss (or if there is no","page_number":166,"box":{"x":102,"y":657,"width":796,"height":11}},{"id":"064b7239-184a-465d-8b01-b035f5f7fffa","block_type":"box","text":"net capital loss, any net long-term or short-term capital loss) realized after October and its late-year ordinary loss","page_number":166,"box":{"x":69,"y":672,"width":806,"height":11}},{"id":"baaab39c-ed34-4da2-a3ac-1f47f2b46bf2","block_type":"box","text":"(defined as the sum of the excess of post-October foreign currency and PFIC losses over post-October foreign","page_number":166,"box":{"x":69,"y":687,"width":778,"height":11}},{"id":"fa8095d0-aa82-4285-a583-d9b8cd5142e7","block_type":"box","text":"currency and PFIC gains plus the excess of post-December ordinary losses over post-December ordinary income) until","page_number":166,"box":{"x":69,"y":702,"width":838,"height":12}},{"id":"502c6d4b-df3a-4c88-a769-7d4ac2b533b0","block_type":"box","text":"the next taxable year in computing its investment company taxable income and net capital gain, which will defer the","page_number":166,"box":{"x":68,"y":717,"width":824,"height":12}},{"id":"f24b77e5-f663-4f6f-8d42-ef562e3f02fd","block_type":"box","text":"recognition of such realized losses. Such deferrals and other rules regarding gains and losses realized after October","page_number":166,"box":{"x":69,"y":732,"width":830,"height":12}},{"id":"cf602596-f69f-4fd7-ae72-21f112c74c90","block_type":"box","text":"(or December) may affect the tax character of shareholder distributions.","page_number":166,"box":{"x":69,"y":748,"width":511,"height":11}},{"id":"8b87e9af-1ae4-4dfe-83ea-5c08546ffa0a","block_type":"box","text":"Municipal Funds","page_number":166,"box":{"x":102,"y":771,"width":115,"height":10}},{"id":"996c2f75-3d12-4793-9f5c-f02662ee8ed4","block_type":"box","text":"Each Municipal Fund intends to qualify to pay “exempt-interest dividends” as defined in Section 852(b)(5) of the","page_number":166,"box":{"x":102,"y":793,"width":798,"height":11}},{"id":"ba7c8de4-eea9-4d1c-95c2-049979333810","block_type":"box","text":"Code. Under such section if, at the close of each quarter of a Fund’s taxable year, at least 50% of the value of the","page_number":166,"box":{"x":69,"y":808,"width":815,"height":11}},{"id":"793d5de8-8167-4315-aa53-0b3c09be7e08","block_type":"box","text":"Fund’s total assets consists of obligations exempt from U.S. federal income tax (“tax-exempt obligations”) under","page_number":166,"box":{"x":70,"y":823,"width":803,"height":12}},{"id":"130d2e7b-cb98-4702-8f7d-b3797d7a9e0d","block_type":"box","text":"Section 103(a) of the Code (relating generally to obligations of a state or local governmental unit), the Fund shall be","page_number":166,"box":{"x":69,"y":838,"width":826,"height":12}},{"id":"7a581f2d-d863-4977-a686-1b7bb320d24f","block_type":"box","text":"qualified to pay exempt-interest dividends to holders of all outstanding classes of its shares (together the","page_number":166,"box":{"x":69,"y":853,"width":752,"height":12}},{"id":"81e2f7f4-0f3c-4ceb-9ef4-8753ad4b25e9","block_type":"box","text":"“shareholders”). Exempt-interest dividends are dividends or any part thereof paid by a Fund that are attributable to","page_number":166,"box":{"x":70,"y":869,"width":817,"height":11}},{"id":"e8bc375e-0564-45a5-9278-dc63705a65ee","block_type":"box","text":"interest on tax-exempt obligations and reported by the Fund as exempt-interest dividends. A Fund will allocate","page_number":166,"box":{"x":70,"y":884,"width":780,"height":11}},{"id":"dabfee4e-3fd3-48a0-a8a9-fd2fa0e3b058","block_type":"box","text":"interest from tax-exempt obligations (as well as ordinary income, capital gains and tax preference items discussed","page_number":166,"box":{"x":70,"y":899,"width":815,"height":11}},{"id":"eeef898c-bc70-4cbf-abba-607a453d0f17","block_type":"box","text":"II-135","page_number":166,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"55641b05-1cd5-4ddc-8476-a41ebd9cb3b3","block_type":"box","text":"NM0926U-5977317-166/232","page_number":166,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"db22d23d-9d26-4f37-9d63-d00f3acf906a","block_type":"box","text":"below) among the Fund’s shareholders according to a method (that it believes is consistent with the Commission rule","page_number":167,"box":{"x":69,"y":45,"width":839,"height":11}},{"id":"95278ee8-cc41-4352-b12b-ad569e185727","block_type":"box","text":"permitting the issuance and sale of multiple classes of shares) that is based upon the gross income that is allocable","page_number":167,"box":{"x":70,"y":60,"width":835,"height":11}},{"id":"517cb208-e0cd-4380-80ed-4827c1151a04","block_type":"box","text":"to each class of shareholders during the taxable year, or such other method as the IRS may prescribe.","page_number":167,"box":{"x":68,"y":75,"width":730,"height":11}},{"id":"75673a00-9ce0-489d-9bd5-8b18b08e90f4","block_type":"box","text":"Exempt-interest dividends will be excludable from a shareholder’s gross income for U.S. federal income tax","page_number":167,"box":{"x":102,"y":98,"width":763,"height":11}},{"id":"455bbd93-50fa-4d35-a7df-2f4865e0d134","block_type":"box","text":"purposes. Exempt-interest dividends are included, however, in determining the portion, if any, of a person’s social","page_number":167,"box":{"x":70,"y":113,"width":809,"height":11}},{"id":"c8091eb6-006c-430e-bdbc-95fdb4f31694","block_type":"box","text":"security and railroad retirement benefits subject to U.S. federal income taxes. Interest on indebtedness incurred or","page_number":167,"box":{"x":69,"y":128,"width":821,"height":11}},{"id":"ba9405f2-2d23-4bf4-bc78-b88cdf4a6772","block_type":"box","text":"continued to purchase or carry shares of a regulated investment company paying exempt-interest dividends, such as","page_number":167,"box":{"x":69,"y":143,"width":831,"height":11}},{"id":"07811b06-910a-4c94-8a3d-e4c468f372a5","block_type":"box","text":"the Fund, will not be deductible by the investor for U.S. federal income tax purposes to the extent attributable to","page_number":167,"box":{"x":68,"y":158,"width":800,"height":11}},{"id":"b981fafa-263e-4b76-a313-406d1a54408d","block_type":"box","text":"exempt-interest dividends. Shareholders are advised to consult their tax advisors with respect to whether exempt","page_number":167,"box":{"x":69,"y":173,"width":810,"height":11}},{"id":"d4be3f12-4d59-4e64-95bf-a7c0428f1ba2","block_type":"box","text":"interest dividends retain the exclusion under Code Section 103(a) if a shareholder would be treated as a “substantial","page_number":167,"box":{"x":70,"y":188,"width":836,"height":11}},{"id":"932a1927-3d8d-4733-9615-8fee5cf869d5","block_type":"box","text":"user” or “related person” under Code Section 147(a) with respect to property financed with the proceeds of an issue","page_number":167,"box":{"x":69,"y":203,"width":835,"height":12}},{"id":"1ddaf8c8-add4-4c43-8dde-ab71d88085ca","block_type":"box","text":"of PABs, if any, held by a Fund.","page_number":167,"box":{"x":69,"y":218,"width":217,"height":12}},{"id":"f589917b-e199-4e28-86b4-3f0c9b28051e","block_type":"box","text":"Substitute payments received by a Fund representing interest paid on tax-exempt obligations loaned out by the","page_number":167,"box":{"x":102,"y":241,"width":788,"height":11}},{"id":"ca5201cc-2644-4dbe-af34-1004842efa1a","block_type":"box","text":"Fund will not be considered exempt interest, and distributions by the Fund of such substitute payments will not","page_number":167,"box":{"x":70,"y":256,"width":790,"height":11}},{"id":"740c569d-3c5d-4e1b-b8d0-b8b351cc29d6","block_type":"box","text":"constitute exempt-interest dividends.","page_number":167,"box":{"x":69,"y":272,"width":261,"height":10}},{"id":"ac64c4ae-049c-44ab-975f-094fa04c0461","block_type":"box","text":"Distributions in excess of a Fund’s earnings and profits will first reduce the adjusted tax basis of a holder’s","page_number":167,"box":{"x":102,"y":294,"width":765,"height":11}},{"id":"065bab82-06f6-4ab7-8e28-da1205f4a7a9","block_type":"box","text":"shares and, after such adjusted tax basis is reduced to zero, will constitute capital gains to such holder (assuming","page_number":167,"box":{"x":69,"y":309,"width":819,"height":11}},{"id":"c995e5f1-984c-4af9-b1a7-f21859b8d652","block_type":"box","text":"the shares are held as a capital asset). Any loss upon the sale or exchange of Fund shares held for six months or","page_number":167,"box":{"x":68,"y":324,"width":813,"height":12}},{"id":"b3b306f6-05b0-4daf-944f-7e0ace20d678","block_type":"box","text":"less will be disallowed to the extent of any exempt-interest dividends received by the shareholder. In addition, any","page_number":167,"box":{"x":70,"y":339,"width":809,"height":12}},{"id":"642aa7b3-10fc-4d30-a104-b474a9a3f571","block_type":"box","text":"such loss that is not disallowed under the rule stated above will be treated as long-term capital loss to the extent of","page_number":167,"box":{"x":69,"y":355,"width":829,"height":11}},{"id":"84d48f63-512f-4154-a3df-128a31db9117","block_type":"box","text":"any capital gain dividends received by the shareholder.","page_number":167,"box":{"x":69,"y":370,"width":388,"height":11}},{"id":"899bc3f7-9f65-4eaa-b08d-6ec5192b9d8c","block_type":"box","text":"All or a portion of a Fund’s gains from the sale or redemption of tax-exempt obligations purchased at a market","page_number":167,"box":{"x":101,"y":392,"width":787,"height":12}},{"id":"7fc26e80-27ae-41c5-b199-532d10e7f728","block_type":"box","text":"discount will be treated as ordinary income rather than capital gain. This rule may increase the amount of ordinary","page_number":167,"box":{"x":69,"y":407,"width":817,"height":12}},{"id":"73ad9ff0-45a2-4429-be2e-be101b66d8f5","block_type":"box","text":"income dividends received by shareholders.","page_number":167,"box":{"x":70,"y":423,"width":309,"height":11}},{"id":"14f536ac-88c6-460c-88ec-5e514bc3a900","block_type":"box","text":"Any market discount recognized on a bond is taxable as ordinary income. A market discount bond is a bond","page_number":167,"box":{"x":101,"y":446,"width":766,"height":11}},{"id":"0045dafc-edd5-4485-9b4b-75f2507c74a0","block_type":"box","text":"acquired in the secondary market at a price below redemption value or adjusted issue price if issued with original","page_number":167,"box":{"x":69,"y":460,"width":808,"height":12}},{"id":"97d8894c-6a60-4bf2-ac8c-983f3d1e5c6a","block_type":"box","text":"issue discount. Absent an election by the Fund to include the market discount in income as it accrues, gain on the","page_number":167,"box":{"x":70,"y":476,"width":815,"height":11}},{"id":"090b8ee7-eea5-4a11-8015-c558e9d4a7ec","block_type":"box","text":"Fund’s disposition of such an obligation will be treated as ordinary income rather than capital gain to the extent of","page_number":167,"box":{"x":70,"y":491,"width":815,"height":11}},{"id":"13ae0a9e-9a38-4eb0-8032-91dc7b940183","block_type":"box","text":"the accrued market discount.","page_number":167,"box":{"x":68,"y":506,"width":208,"height":9}},{"id":"fe8b053f-c4cb-4141-94a5-006540d40369","block_type":"box","text":"The Code subjects interest received on certain otherwise tax-exempt securities to a federal alternative minimum","page_number":167,"box":{"x":101,"y":528,"width":801,"height":12}},{"id":"8f042f49-c82d-4905-b04d-a18565d169bd","block_type":"box","text":"tax. The alternative minimum tax applies to interest received on certain “PABs” issued after August 7, 1986. PABs","page_number":167,"box":{"x":68,"y":543,"width":818,"height":12}},{"id":"6cc9f7ff-650c-44d0-894e-a0036e265c9e","block_type":"box","text":"are bonds that, although tax-exempt, are used for purposes other than those generally performed by governmental","page_number":167,"box":{"x":69,"y":559,"width":816,"height":11}},{"id":"294769d0-2454-407e-8ab3-5c6fb0079524","block_type":"box","text":"units and that benefit non-governmental entities (","page_number":167,"box":{"x":69,"y":574,"width":351,"height":11}},{"id":"5721c53d-b4f0-4459-919a-e8437dac6179","block_type":"box","text":"e.g.","page_number":167,"box":{"x":422,"y":575,"width":24,"height":10}},{"id":"0bb0397e-5d48-4a35-a694-72e135a25888","block_type":"box","text":", bonds used for industrial development or housing purposes).","page_number":167,"box":{"x":449,"y":574,"width":441,"height":11}},{"id":"f5e79887-7b9d-4b78-ae32-8e3f3bf633a8","block_type":"box","text":"Income received on such bonds is classified as an item of “tax preference,” which could subject certain investors in","page_number":167,"box":{"x":70,"y":589,"width":827,"height":11}},{"id":"c4e84079-3916-42c8-bb48-d84094bea37d","block_type":"box","text":"such bonds, including shareholders of a Fund, to a federal alternative minimum tax. A Fund will purchase such","page_number":167,"box":{"x":69,"y":604,"width":786,"height":11}},{"id":"418d1f39-edb7-4c79-9ad8-1423e2620577","block_type":"box","text":"“PABs” and will report to shareholders after the close of the calendar year the portion of the Fund’s dividends","page_number":167,"box":{"x":70,"y":619,"width":782,"height":11}},{"id":"90b5c046-9c2b-4312-a226-2a91dcebfc21","block_type":"box","text":"declared during the year that constitute an item of tax preference for alternative minimum tax purposes.","page_number":167,"box":{"x":69,"y":634,"width":740,"height":12}},{"id":"530c2bc2-9d26-4511-b5f6-e5b4b22fe5f7","block_type":"box","text":"Each Municipal Fund may engage in interest rate swap transactions. The U.S. federal income tax rules governing","page_number":167,"box":{"x":102,"y":657,"width":802,"height":11}},{"id":"4c937d2c-d9d0-4d3c-89d8-a65244a39c88","block_type":"box","text":"the taxation of interest rate swaps are not entirely clear and may require a Fund to treat payments received under","page_number":167,"box":{"x":68,"y":672,"width":812,"height":11}},{"id":"ab301295-45bd-465d-826c-e4fd3791509b","block_type":"box","text":"such arrangements as ordinary income and to amortize payments made under certain circumstances. Because","page_number":167,"box":{"x":69,"y":687,"width":794,"height":11}},{"id":"b0724b17-4849-4f05-ad08-f1b76caeaa3a","block_type":"box","text":"payments received by a Fund in connection with swap transactions will be taxable rather than tax-exempt and","page_number":167,"box":{"x":70,"y":703,"width":776,"height":10}},{"id":"56382447-dc83-47e6-952a-2c4b30ec5fb5","block_type":"box","text":"because swap payments made by a Fund will offset both taxable and tax-exempt gross income proportionately, they","page_number":167,"box":{"x":69,"y":717,"width":826,"height":12}},{"id":"58a4c569-5ee3-4c47-a002-da44daef11d8","block_type":"box","text":"may result in increased taxable distributions to shareholders.","page_number":167,"box":{"x":69,"y":733,"width":436,"height":11}},{"id":"20a84286-3bf4-44ef-9d30-fcf0bc45f880","block_type":"box","text":"Please see Part I of your Fund’s SAI for certain state tax information relevant to an investment in BlackRock","page_number":167,"box":{"x":102,"y":755,"width":771,"height":11}},{"id":"dcc67b65-ed65-4b1a-b908-34ad1148af3e","block_type":"box","text":"California Municipal Opportunities Fund, BlackRock New Jersey Municipal Bond Fund, BlackRock New York Municipal","page_number":167,"box":{"x":69,"y":770,"width":828,"height":11}},{"id":"cfffaac3-7e3d-4bf9-ba3a-0030dc5bc020","block_type":"box","text":"Opportunities Fund and BlackRock Pennsylvania Municipal Bond Fund, as well as information on economic conditions","page_number":167,"box":{"x":69,"y":785,"width":836,"height":12}},{"id":"761c9bf0-995b-4523-9c65-18449975d26d","block_type":"box","text":"within each applicable state.","page_number":167,"box":{"x":68,"y":801,"width":203,"height":11}},{"id":"f2a71db3-3cb7-49ae-b459-06867f823f80","block_type":"box","text":"In the case of a Feeder Fund, such Fund is entitled to look to the underlying assets of the Master Portfolio in","page_number":167,"box":{"x":102,"y":823,"width":774,"height":12}},{"id":"cd4f53da-5b39-4c44-8c3d-998a3f51cef2","block_type":"box","text":"which it has invested for purposes of satisfying various qualification requirements of the Code applicable to regulated","page_number":167,"box":{"x":68,"y":838,"width":837,"height":12}},{"id":"b6155b88-8255-41b4-8c7a-05636edc85fe","block_type":"box","text":"investment companies. Each Master Portfolio is classified either as a partnership or a separate disregarded entity","page_number":167,"box":{"x":70,"y":853,"width":816,"height":12}},{"id":"356ade46-9b65-4b61-a0a7-4291028b694c","block_type":"box","text":"(depending on the particular Master Portfolio) for U.S. federal income tax purposes. If applicable tax provisions were","page_number":167,"box":{"x":69,"y":869,"width":830,"height":11}},{"id":"e677c41f-6eb6-4937-8188-bc181c429060","block_type":"box","text":"to change the classification of a Master Portfolio, then the Board of Directors of a Feeder Fund would determine, in","page_number":167,"box":{"x":68,"y":884,"width":822,"height":11}},{"id":"d0a4f658-e590-4f39-bb56-52a06fd3fee3","block_type":"box","text":"its discretion, the appropriate course of action for the Feeder Fund. One possible course of action would be to","page_number":167,"box":{"x":70,"y":899,"width":783,"height":11}},{"id":"fde7e50c-3b54-4e35-85e7-2a15556794f6","block_type":"box","text":"II-136","page_number":167,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"8b4ead14-7464-418f-abd2-1a3810ae4df9","block_type":"box","text":"NM0926U-5977317-167/232","page_number":167,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"31ae0474-c93d-42d2-80ba-f1f520729dc1","block_type":"box","text":"withdraw the Feeder Fund’s investments from the Master Portfolio and to retain an investment manager to manage","page_number":168,"box":{"x":68,"y":45,"width":822,"height":11}},{"id":"fd5240e2-2515-489a-809f-a81579cca009","block_type":"box","text":"the Feeder Fund’s assets in accordance with the investment policies applicable to the Feeder Fund.","page_number":168,"box":{"x":68,"y":60,"width":710,"height":11}},{"id":"609c6aed-5006-4d04-b5ca-2b8bbcc675ed","block_type":"box","text":"Ordinary income and capital gain dividends may also be subject to state and local taxes. Certain states exempt","page_number":168,"box":{"x":102,"y":83,"width":796,"height":11}},{"id":"ce48f204-caa1-41b6-bc8c-d9e16a8c8a86","block_type":"box","text":"from state income taxation dividends paid by regulated investment companies that are derived from interest on U.S.","page_number":168,"box":{"x":68,"y":98,"width":828,"height":11}},{"id":"ce6c742c-fb55-4f10-bfa7-424ceb2011ab","block_type":"box","text":"government obligations. State law varies as to whether dividend income attributable to U.S. government obligations is","page_number":168,"box":{"x":68,"y":113,"width":841,"height":11}},{"id":"d16cd1b6-970d-45b1-b5e7-53c063b6d3b2","block_type":"box","text":"exempt from state income tax.","page_number":168,"box":{"x":69,"y":128,"width":216,"height":11}},{"id":"1b71f9cc-d8fb-47c4-a7b3-2096c6742ce4","block_type":"box","text":"Shareholders of each Fund are urged to consult their tax advisers regarding specific questions as to federal,","page_number":168,"box":{"x":102,"y":150,"width":771,"height":12}},{"id":"a2a1e7e9-d6d3-4d71-907d-dfb6f31ddd75","block_type":"box","text":"foreign, state or local taxes with respect to their Fund. Foreign investors should consider applicable foreign taxes in","page_number":168,"box":{"x":68,"y":166,"width":823,"height":11}},{"id":"7524f8c8-2b1d-452c-b7dd-048636f6dc91","block_type":"box","text":"their evaluation of an investment in a Fund.","page_number":168,"box":{"x":68,"y":181,"width":309,"height":9}},{"id":"c9a98d27-398a-4a34-b1e3-8820f497ebc5","block_type":"box","text":"The foregoing general discussion of U.S. federal income tax consequences is based on the Code and the","page_number":168,"box":{"x":101,"y":203,"width":749,"height":12}},{"id":"beb7df1d-9eb1-41b2-bdbc-9664bc0ccebc","block_type":"box","text":"regulations issued thereunder as in effect on the date of this SAI. Future legislative or administrative changes or","page_number":168,"box":{"x":69,"y":218,"width":803,"height":12}},{"id":"838138c0-8f87-4f16-8e9e-33e99fa9ac57","block_type":"box","text":"court decisions may significantly change the conclusions expressed in this discussion, and any such changes or","page_number":168,"box":{"x":69,"y":234,"width":801,"height":11}},{"id":"fe27df28-b8a2-46d5-b07c-2c8d69be7341","block_type":"box","text":"decisions may have a retroactive effect.","page_number":168,"box":{"x":69,"y":249,"width":283,"height":11}},{"id":"c12662c3-12b2-4543-afdd-f8cad57bb559","block_type":"box","text":"PERFORMANCE DATA","page_number":168,"box":{"x":403,"y":278,"width":173,"height":10}},{"id":"ab740a5c-cb95-46d4-8a28-f64f24f21072","block_type":"box","text":"From time to time a Fund may include its average annual total return and other total return data, and, if","page_number":168,"box":{"x":102,"y":301,"width":738,"height":11}},{"id":"ae210c63-10ef-47fc-982d-0f78f330e2a5","block_type":"box","text":"applicable, yield and tax-equivalent yield in advertisements or information furnished to present or prospective","page_number":168,"box":{"x":69,"y":316,"width":779,"height":11}},{"id":"742fa468-46a2-48f7-954e-a9d8e4da687e","block_type":"box","text":"shareholders. Total return, yield and tax-equivalent yield each is based on a Fund’s historical performance and is not","page_number":168,"box":{"x":69,"y":331,"width":833,"height":11}},{"id":"1cd12ba7-abd1-488c-b13b-bca8cd530f58","block_type":"box","text":"intended to indicate future performance. Average annual total return is determined separately for each class of","page_number":168,"box":{"x":70,"y":346,"width":792,"height":12}},{"id":"12abecb4-684e-4364-a60f-b5fcddad95b9","block_type":"box","text":"shares in accordance with a formula specified by the Commission.","page_number":168,"box":{"x":69,"y":361,"width":473,"height":12}},{"id":"14fcae25-2471-45c7-be0e-5d0f36e57cb0","block_type":"box","text":"Quotations of average annual total return, before tax, for the specified periods are computed by finding the","page_number":168,"box":{"x":102,"y":384,"width":761,"height":11}},{"id":"4ede50a1-9142-4ee5-b618-de028ce0fb83","block_type":"box","text":"average annual compounded rates of return (based on net investment income and any realized and unrealized capital","page_number":168,"box":{"x":69,"y":399,"width":836,"height":12}},{"id":"dfd0c0d3-98f9-4ea5-b875-cc7b4f7812df","block_type":"box","text":"gains or losses on portfolio investments over such periods) that would equate the initial amount invested to the","page_number":168,"box":{"x":68,"y":414,"width":798,"height":12}},{"id":"e53441cf-0f65-4fa2-8b4b-fcdc2b9c4f29","block_type":"box","text":"redeemable value of such investment at the end of each period. Average annual total return before taxes is","page_number":168,"box":{"x":69,"y":429,"width":765,"height":12}},{"id":"38ef61ce-1cfc-447b-9a43-b75c56940820","block_type":"box","text":"computed assuming all dividends are reinvested and taking into account all applicable recurring and nonrecurring","page_number":168,"box":{"x":69,"y":445,"width":808,"height":11}},{"id":"db0e520f-1df0-4338-b3be-c8ec91838ce2","block_type":"box","text":"expenses, including the maximum sales charge, in the case of front-end load shares, and the CDSC that would be","page_number":168,"box":{"x":69,"y":460,"width":813,"height":11}},{"id":"3eda0498-9c31-4f4a-bbca-5ab9cfda8042","block_type":"box","text":"applicable to a complete redemption of the investment at the end of the specified period in the case of CDSC shares,","page_number":168,"box":{"x":69,"y":475,"width":839,"height":11}},{"id":"346d1b85-0405-439d-bc63-b28ba73e8b45","block_type":"box","text":"but does not take into account taxes payable on dividends or on redemption.","page_number":168,"box":{"x":69,"y":490,"width":546,"height":11}},{"id":"7eec7cdf-4824-4dd5-bc59-c2b46d1b610b","block_type":"box","text":"Quotations of average annual total return, after taxes, on dividends for the specified periods are computed by","page_number":168,"box":{"x":102,"y":513,"width":781,"height":11}},{"id":"a7bf395d-47fb-4b79-8367-7e32ecfab994","block_type":"box","text":"finding the average annual compounded rates of return that would equate the initial amount invested to the ending","page_number":168,"box":{"x":68,"y":528,"width":819,"height":11}},{"id":"f6cb2fc1-de0a-4ba5-9bb7-d5e462d8847b","block_type":"box","text":"value of such investment at the end of each period assuming payment of taxes on dividends received during such","page_number":168,"box":{"x":68,"y":543,"width":810,"height":11}},{"id":"4bfebc0a-677d-4ab8-9299-8e954d231ed8","block_type":"box","text":"period. Average annual total return after taxes on dividends is computed assuming all dividends, less the taxes due","page_number":168,"box":{"x":70,"y":558,"width":823,"height":11}},{"id":"01343543-3f52-46b2-8a7f-1e96b8ea551c","block_type":"box","text":"on such dividends, are reinvested and taking into account all applicable recurring and nonrecurring expenses,","page_number":168,"box":{"x":69,"y":573,"width":780,"height":11}},{"id":"d9169e17-b042-401f-9630-7a88133c34d4","block_type":"box","text":"including the maximum sales charge, in the case of front-end load shares and the CDSC that would be applicable to","page_number":168,"box":{"x":70,"y":588,"width":825,"height":12}},{"id":"71ad2e77-ae71-4696-8d43-b950e1d7408d","block_type":"box","text":"a complete redemption of the investment at the end of the specified period in the case of CDSC shares. The taxes","page_number":168,"box":{"x":69,"y":603,"width":817,"height":11}},{"id":"b41f7bca-1a56-47c1-886b-9b62ab0b4e07","block_type":"box","text":"due on dividends are calculated by applying to each dividend the highest applicable marginal U.S. federal individual","page_number":168,"box":{"x":69,"y":618,"width":820,"height":12}},{"id":"b4aa96d8-0f00-404f-b7a7-bc1532a1b865","block_type":"box","text":"income tax rates in effect on the reinvestment date for that dividend. The rates used correspond to the tax character","page_number":168,"box":{"x":70,"y":634,"width":833,"height":11}},{"id":"521b586a-acd8-4c2a-8975-fee151c4f8a7","block_type":"box","text":"(including eligibility for the maximum 20% tax rate applicable to qualified dividend income) of each dividend. The","page_number":168,"box":{"x":69,"y":649,"width":797,"height":11}},{"id":"fdab5c34-da7d-463e-b76e-8009a4847a6e","block_type":"box","text":"taxable amount and tax character of each dividend are specified by each Fund on the dividend declaration date, but","page_number":168,"box":{"x":68,"y":664,"width":824,"height":11}},{"id":"24b5b976-e94f-4fcb-84ec-aa13be9dd53f","block_type":"box","text":"may be adjusted to reflect subsequent recharacterizations of distributions. The applicable tax rates may vary over the","page_number":168,"box":{"x":69,"y":679,"width":837,"height":11}},{"id":"a32b3645-83a3-4310-9201-dcacd7e70c17","block_type":"box","text":"measurement period. The effects of state and local taxes are not reflected. Applicable tax credits, such as foreign","page_number":168,"box":{"x":69,"y":694,"width":814,"height":11}},{"id":"5b1a9dff-b464-4910-8f94-45fd3755b1d1","block_type":"box","text":"credits, are taken into account according to U.S. federal tax law. The ending value is determined assuming complete","page_number":168,"box":{"x":69,"y":709,"width":830,"height":11}},{"id":"547b71bd-20d0-4624-a6de-1b66a66a3b1f","block_type":"box","text":"redemption at the end of the applicable periods with no tax consequences associated with such redemption.","page_number":168,"box":{"x":69,"y":724,"width":774,"height":11}},{"id":"184112d9-a104-49f0-b7eb-6d46baa87a0a","block_type":"box","text":"Quotations of average annual total return, after taxes, on both dividends and redemption for the specified","page_number":168,"box":{"x":102,"y":747,"width":752,"height":11}},{"id":"8226c3c8-b9b0-4418-bc31-e93b9a9e2460","block_type":"box","text":"periods are computed by finding the average annual compounded rates of return that would equate the initial amount","page_number":168,"box":{"x":70,"y":762,"width":835,"height":11}},{"id":"f279ebb7-fb28-479e-867e-178951f1f328","block_type":"box","text":"invested to the ending value of such investment at the end of each period assuming payment of taxes on dividends","page_number":168,"box":{"x":70,"y":777,"width":820,"height":12}},{"id":"810ec740-1e96-49d4-a48c-8b339fbff92b","block_type":"box","text":"received during such period as well as on complete redemption. Average annual total return after taxes on","page_number":168,"box":{"x":69,"y":792,"width":756,"height":12}},{"id":"6203429c-0b6c-4a3c-93fc-081383f67c6f","block_type":"box","text":"distributions and redemption is computed assuming all dividends, less the taxes due on such dividends, are","page_number":168,"box":{"x":69,"y":808,"width":772,"height":11}},{"id":"195959be-9876-4a41-8f98-fe3ca03ba333","block_type":"box","text":"reinvested and taking into account all applicable recurring and nonrecurring expenses, including the maximum sales","page_number":168,"box":{"x":69,"y":823,"width":827,"height":11}},{"id":"744b3219-4d9f-4cc1-a068-9395226487de","block_type":"box","text":"charge in the case of front-end load shares and the CDSC that would be applicable to a complete redemption of the","page_number":168,"box":{"x":69,"y":838,"width":825,"height":11}},{"id":"9eaa1281-24ba-4860-9dbd-2f4c5a6553a8","block_type":"box","text":"investment at the end of the specified period in the case of CDSC shares and assuming, for all classes of shares,","page_number":168,"box":{"x":70,"y":853,"width":812,"height":11}},{"id":"00282fc4-2abf-4e30-a8f7-d427567ac661","block_type":"box","text":"complete redemption and payment of taxes due on such redemption. The ending value is determined assuming","page_number":168,"box":{"x":69,"y":868,"width":795,"height":11}},{"id":"ab3cffb2-c039-4136-bec9-bf69122b19f3","block_type":"box","text":"complete redemption at the end of the applicable periods, subtracting capital gains taxes resulting from the","page_number":168,"box":{"x":69,"y":883,"width":768,"height":11}},{"id":"beda122a-ca53-4a19-a176-29f76a03ede6","block_type":"box","text":"redemption and adding the presumed tax benefit from capital losses resulting from redemption. The taxes due on","page_number":168,"box":{"x":69,"y":898,"width":810,"height":11}},{"id":"1f69ca6d-f26a-4f70-8cc6-8377d1724c8e","block_type":"box","text":"II-137","page_number":168,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"cfae7ef4-89bf-4995-b173-d09efcbd68f6","block_type":"box","text":"NM0926U-5977317-168/232","page_number":168,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"3a3ee116-c0e7-4e2f-9223-b070367d0d5e","block_type":"box","text":"dividends and on the deemed redemption are calculated by applying the highest applicable marginal U.S. federal","page_number":169,"box":{"x":69,"y":45,"width":802,"height":11}},{"id":"67b2da69-88cd-42f4-8454-ffec3e12aa03","block_type":"box","text":"individual income tax rates in effect on the reinvestment and/or the redemption date. The rates used correspond to","page_number":169,"box":{"x":70,"y":60,"width":825,"height":11}},{"id":"fdc85156-f7be-42f0-9659-511795549c53","block_type":"box","text":"the tax character (including eligibility for the maximum 20% tax rate applicable to qualified dividend income) of each","page_number":169,"box":{"x":68,"y":75,"width":823,"height":11}},{"id":"75d1e1b3-1099-4562-88e7-3225167f7052","block_type":"box","text":"component of each dividend and/or the redemption payment. The applicable tax rates may vary over the","page_number":169,"box":{"x":69,"y":90,"width":743,"height":11}},{"id":"b2c09f3d-0e18-4b15-942b-7f529f66bcc1","block_type":"box","text":"measurement period. The effects of state and local taxes are not reflected. Applicable tax credits, such as foreign","page_number":169,"box":{"x":69,"y":105,"width":814,"height":11}},{"id":"c807ebee-d42c-4126-ab2c-f0207a43e1a6","block_type":"box","text":"tax credits, are taken into account according to federal law.","page_number":169,"box":{"x":68,"y":120,"width":422,"height":12}},{"id":"aac165a8-46e6-4709-ab3f-9df528b34352","block_type":"box","text":"A Fund also may quote annual, average annual and annualized total return and aggregate total return","page_number":169,"box":{"x":101,"y":143,"width":720,"height":11}},{"id":"463e2b11-baf9-4e22-9054-439c1bdbb829","block_type":"box","text":"performance data, both as a percentage and as a dollar amount based on a hypothetical investment of $1,000 or","page_number":169,"box":{"x":70,"y":157,"width":813,"height":12}},{"id":"29df0537-90a4-479d-bd97-8d0c4b75e1ea","block_type":"box","text":"some other amount, for various periods other than those noted in Part I of each Fund’s SAI. Such data will be","page_number":169,"box":{"x":69,"y":173,"width":781,"height":11}},{"id":"50ade060-5112-42e6-a5ac-a8ff9c402b8b","block_type":"box","text":"computed as described above, except that (1) as required by the periods of the quotations, actual annual, annualized","page_number":169,"box":{"x":69,"y":188,"width":837,"height":11}},{"id":"19a0175d-d5b5-4fb6-9505-dcbe236f248e","block_type":"box","text":"or aggregate data, rather than average annual data, may be quoted and (2) the maximum applicable sales charges","page_number":169,"box":{"x":69,"y":203,"width":817,"height":12}},{"id":"ef93fdd2-78f4-4ea4-8759-f65be62c6503","block_type":"box","text":"will not be included with respect to annual or annualized rates of return calculations. Aside from the impact on the","page_number":169,"box":{"x":68,"y":218,"width":815,"height":11}},{"id":"6a720c53-c038-4c68-95ba-6c78d2e72950","block_type":"box","text":"performance data calculations of including or excluding the maximum applicable sales charges, actual annual or","page_number":169,"box":{"x":70,"y":234,"width":801,"height":11}},{"id":"24f886ba-f9a6-4bc6-8ba3-deac698b6216","block_type":"box","text":"annualized total return data generally will be lower than average annual total return data since the average rates of","page_number":169,"box":{"x":69,"y":249,"width":819,"height":11}},{"id":"456e8fe9-a307-48a3-86ea-ae6a4083bed5","block_type":"box","text":"return reflect compounding of return; aggregate total return data generally will be higher than average annual total","page_number":169,"box":{"x":69,"y":264,"width":811,"height":11}},{"id":"30d57d54-96f3-4286-96de-fd8c8f654df6","block_type":"box","text":"return data since the aggregate rates of return reflect compounding over a longer period of time.","page_number":169,"box":{"x":69,"y":279,"width":686,"height":11}},{"id":"7f39c6b2-d681-4702-b052-103667aa3951","block_type":"box","text":"Yield quotations will be computed based on a 30-day period by dividing (a) the net income based on the yield of","page_number":169,"box":{"x":101,"y":302,"width":796,"height":11}},{"id":"d4289815-fbad-4e6e-b790-1c21ea094156","block_type":"box","text":"each security earned during the period by (b) the average daily number of shares outstanding during the period that","page_number":169,"box":{"x":69,"y":317,"width":821,"height":11}},{"id":"8a73c378-ad29-485b-a4a9-098317f5ab3b","block_type":"box","text":"were entitled to receive dividends multiplied by the maximum offering price per share on the last day of the period.","page_number":169,"box":{"x":68,"y":332,"width":817,"height":11}},{"id":"41926db7-a3a9-45d1-8b0f-1e7cde888c18","block_type":"box","text":"Tax equivalent yield quotations will be computed by dividing (a) the part of a Fund’s yield that is tax-exempt by (b) one","page_number":169,"box":{"x":68,"y":347,"width":837,"height":11}},{"id":"5e8cfc05-5585-435f-938b-0e5077fc74e7","block_type":"box","text":"minus a stated tax rate and adding the result to that part, if any, of the Fund’s yield that is not tax-exempt.","page_number":169,"box":{"x":69,"y":362,"width":759,"height":11}},{"id":"b1f9d046-63fb-4d0e-9ba5-8e61e09cb67b","block_type":"box","text":"A Fund’s total return will vary depending on market conditions, the securities comprising a Fund’s portfolio, a","page_number":169,"box":{"x":101,"y":385,"width":779,"height":11}},{"id":"862c4bb3-79dc-46e6-a954-03f0434217bc","block_type":"box","text":"Fund’s operating expenses and the amount of realized and unrealized net capital gains or losses during the period.","page_number":169,"box":{"x":70,"y":400,"width":819,"height":11}},{"id":"f1df2f7e-0ad7-4b16-9a00-b8f802238a12","block_type":"box","text":"The value of an investment in a Fund will fluctuate and an investor’s shares, when redeemed, may be worth more or","page_number":169,"box":{"x":68,"y":415,"width":830,"height":11}},{"id":"e76f0ad2-5d05-4693-bfdf-18d2fd4371f7","block_type":"box","text":"less than their original cost.","page_number":169,"box":{"x":70,"y":430,"width":196,"height":11}},{"id":"9336d693-4731-4ba2-b719-bcfa16ef2569","block_type":"box","text":"In order to reflect the reduced sales charges in the case of front-end load shares or the waiver of the CDSC in","page_number":169,"box":{"x":102,"y":453,"width":782,"height":11}},{"id":"e5b8e6cd-a54d-4331-a39a-b3456eb2647c","block_type":"box","text":"the case of CDSC shares applicable to certain investors, as described under “Purchase of Shares” and “Redemption","page_number":169,"box":{"x":68,"y":468,"width":836,"height":11}},{"id":"5cba533c-1d0d-4b5f-a56f-ed70a80c9245","block_type":"box","text":"of Shares,” respectively, the total return data quoted by a Fund in advertisements directed to such investors may","page_number":169,"box":{"x":69,"y":483,"width":807,"height":11}},{"id":"f12dabb4-2d90-4d70-a79a-6cb81a25eb9e","block_type":"box","text":"take into account the reduced, and not the maximum, sales charge or may take into account the CDSC waiver and,","page_number":169,"box":{"x":68,"y":498,"width":820,"height":11}},{"id":"e46108ac-cf94-4120-9335-c3cc146781aa","block_type":"box","text":"therefore, may reflect greater total return since, due to the reduced sales charges or the waiver of sales charges, a","page_number":169,"box":{"x":68,"y":513,"width":824,"height":12}},{"id":"31bd1848-afd4-4c28-b555-196fedc2cc4a","block_type":"box","text":"lower amount of expenses is deducted.","page_number":169,"box":{"x":70,"y":528,"width":278,"height":11}},{"id":"3759363f-a28c-408b-bcb7-620f03cc8207","block_type":"box","text":"On occasion, a Fund may compare its performance to, among other things, the Fund’s benchmark index","page_number":169,"box":{"x":102,"y":551,"width":741,"height":11}},{"id":"fddc20a1-ed61-4335-baf3-19a4b2787dbf","block_type":"box","text":"indicated in the Prospectus, the Value Line Composite Index, the Dow Jones Industrial Average, or to other published","page_number":169,"box":{"x":70,"y":566,"width":830,"height":11}},{"id":"b6864322-c641-4214-a92c-aacae39131c9","block_type":"box","text":"indices, or to performance data published by Lipper Inc., Morningstar, Inc. (“Morningstar”),","page_number":169,"box":{"x":70,"y":581,"width":646,"height":12}},{"id":"388878ac-79f1-4df1-a419-81b47cecddc9","block_type":"box","text":"Money Magazine, U.S.","page_number":169,"box":{"x":724,"y":581,"width":156,"height":12}},{"id":"515b0dda-d36e-4555-84d3-5074448c2bf1","block_type":"box","text":"News & World Repor t, BusinessWeek, Forbes Magazine, For tune Magazine","page_number":169,"box":{"x":70,"y":597,"width":533,"height":11}},{"id":"ec84c303-e321-41f4-ac5f-e9e864ce7fc0","block_type":"box","text":"or other industry publications. When","page_number":169,"box":{"x":608,"y":597,"width":257,"height":11}},{"id":"39bf689e-5e3d-4218-84bd-5c26e1ffc4a7","block_type":"box","text":"comparing its performance to a market index, a Fund may refer to various statistical measures derived from the","page_number":169,"box":{"x":69,"y":612,"width":797,"height":11}},{"id":"df9839de-c712-4ea6-ac2c-3fe066990364","block_type":"box","text":"historical performance of a Fund and the index, such as standard deviation and beta. As with other performance","page_number":169,"box":{"x":69,"y":627,"width":803,"height":11}},{"id":"5c599065-5e76-40a1-a320-6c29e065523d","block_type":"box","text":"data, performance comparisons should not be considered indicative of a Fund’s relative performance for any future","page_number":169,"box":{"x":69,"y":642,"width":824,"height":11}},{"id":"ca4157cd-8ab3-41e8-979a-235fd1ed9a31","block_type":"box","text":"period. In addition, from time to time a Fund may include the Fund’s Morningstar risk-adjusted performance ratings","page_number":169,"box":{"x":70,"y":657,"width":818,"height":11}},{"id":"e048c0dc-94ad-4634-85a7-3045cb5ab4d0","block_type":"box","text":"assigned by Morningstar in advertising or supplemental sales literature. From time to time a Fund may quote in","page_number":169,"box":{"x":69,"y":672,"width":793,"height":11}},{"id":"9fa7b835-a958-47fa-8478-a012be41497a","block_type":"box","text":"advertisements or other materials other applicable measures of Fund performance and may also make reference to","page_number":169,"box":{"x":69,"y":687,"width":826,"height":11}},{"id":"176c858c-a693-45c5-b7d1-b4f8cd80954f","block_type":"box","text":"awards that may be given to the Manager. Certain Funds may also compare their performance to composite indices","page_number":169,"box":{"x":69,"y":702,"width":825,"height":12}},{"id":"a403934a-602e-4653-bee3-73ea96d50483","block_type":"box","text":"developed by Fund management.","page_number":169,"box":{"x":69,"y":718,"width":233,"height":11}},{"id":"f8d1ded5-4437-48fa-8c75-dd11f28960c8","block_type":"box","text":"A Fund may provide information designed to help investors understand how the Fund is seeking to achieve its","page_number":169,"box":{"x":101,"y":740,"width":780,"height":11}},{"id":"c830f37e-9b74-46dc-be84-f8e15133734d","block_type":"box","text":"investment objectives. This may include information about past, current or possible economic, market, political or","page_number":169,"box":{"x":70,"y":755,"width":810,"height":11}},{"id":"e15e2892-6e7f-43b6-82d3-59833aca3f36","block_type":"box","text":"other conditions, descriptive information or general principles of investing such as asset allocation, diversification","page_number":169,"box":{"x":69,"y":770,"width":810,"height":12}},{"id":"93005e14-5c35-4c6e-90bf-21cb1b3ecdc1","block_type":"box","text":"and risk tolerance, discussion of a Fund’s portfolio composition, investment philosophy, strategy or investment","page_number":169,"box":{"x":69,"y":785,"width":792,"height":12}},{"id":"b30fe814-58db-4c76-b41b-07e31486912d","block_type":"box","text":"techniques, comparisons of the Fund’s performance or portfolio composition to that of other funds or types of","page_number":169,"box":{"x":68,"y":801,"width":788,"height":11}},{"id":"c7afd49d-9dc1-4857-9ff9-a09b20d94e04","block_type":"box","text":"investments, indices relevant to the comparison being made, or to a hypothetical or model portfolio. A Fund may also","page_number":169,"box":{"x":70,"y":816,"width":835,"height":11}},{"id":"6953af6a-cceb-47a9-bb66-ef61b2c7711b","block_type":"box","text":"quote various measures of volatility and benchmark correlation in advertising and other materials, and may compare","page_number":169,"box":{"x":69,"y":831,"width":830,"height":11}},{"id":"17ee2c27-0394-4fef-a3bc-33d32e71363c","block_type":"box","text":"these measures to those of other funds or types of investments.","page_number":169,"box":{"x":68,"y":846,"width":461,"height":11}},{"id":"396979e0-b705-44d4-8cdc-12b2b089b4dd","block_type":"box","text":"II-138","page_number":169,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"aff4947d-76b1-406b-85f7-a3ede3891bc5","block_type":"box","text":"NM0926U-5977317-169/232","page_number":169,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"7a65b2ce-3cb8-418a-9180-188db1522243","block_type":"box","text":"PROXY VOTING POLICIES AND PROCEDURES","page_number":170,"box":{"x":308,"y":45,"width":362,"height":10}},{"id":"b6b16ba2-f27c-4134-9133-984ee7f88f92","block_type":"box","text":"The Board of Directors of the Funds has delegated the voting of proxies for the Funds’ securities to the Manager","page_number":170,"box":{"x":101,"y":68,"width":802,"height":11}},{"id":"c414c1ea-9412-454a-a3fe-f94c6d0d10a6","block_type":"box","text":"pursuant to (i) the Open-End Active and Fixed Income Index Fund Proxy Voting Policy (the “Active Fund Proxy Voting","page_number":170,"box":{"x":70,"y":83,"width":809,"height":11}},{"id":"32df752e-6145-4250-ac32-b52749d62e70","block_type":"box","text":"Policy”), with respect to certain Funds, and (ii) the Index Equity Fund Proxy Voting Policy, with respect to certain other","page_number":170,"box":{"x":69,"y":98,"width":833,"height":11}},{"id":"71077481-1553-46fd-8eaf-22472913e0c0","block_type":"box","text":"Funds, as applicable. Please refer to Part I of this SAI, which discloses the policy applicable to each Fund.","page_number":170,"box":{"x":70,"y":113,"width":755,"height":11}},{"id":"af1c6b88-918e-4a07-9447-e7a3b61a37ea","block_type":"box","text":"With respect to Funds covered by the Active Fund Proxy Voting Policy, the Manager has adopted the BlackRock","page_number":170,"box":{"x":101,"y":136,"width":785,"height":11}},{"id":"2138b8cc-14fd-41a1-91c7-a1595d93b521","block_type":"box","text":"Active Investment Stewardship—Global Engagement and Voting Guidelines (the “BAIS Guidelines”). Certain of such","page_number":170,"box":{"x":68,"y":151,"width":822,"height":11}},{"id":"48d50f99-6539-48fa-93bc-6af142048e9c","block_type":"box","text":"Funds, as listed within the Active Fund Proxy Voting Policy and as disclosed in Part I of this SAI, follow supplemental","page_number":170,"box":{"x":70,"y":166,"width":824,"height":11}},{"id":"fdab0584-f7f7-414d-98b6-accd83618ba3","block_type":"box","text":"guidelines within the BAIS Guidelines that are applicable to certain climate and decarbonization issues (the “BAIS","page_number":170,"box":{"x":68,"y":181,"width":812,"height":12}},{"id":"5add1ff9-dab1-4876-9b08-33d76c742224","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines”).","page_number":170,"box":{"x":69,"y":197,"width":392,"height":10}},{"id":"9220c11f-357a-428c-b4b9-50bc5b0e7ea2","block_type":"box","text":"With respect to Funds covered by the Index Equity Fund Proxy Voting Policy, the Manager has adopted the","page_number":170,"box":{"x":101,"y":219,"width":749,"height":11}},{"id":"da6fc706-2679-42c0-82a3-57402b64fb81","block_type":"box","text":"BlackRock Investment Stewardship (“BIS”) Global Benchmark Policy, comprised of the Global Principles for","page_number":170,"box":{"x":70,"y":234,"width":759,"height":11}},{"id":"5d49d3d0-b12b-4aa3-8a74-fab938e990c7","block_type":"box","text":"Benchmark Policies, regional voting guidelines, and engagement priorities, which are each available upon request. In","page_number":170,"box":{"x":70,"y":250,"width":830,"height":11}},{"id":"b1996fab-a4d5-40f8-8fb3-331459f37cb5","block_type":"box","text":"addition, certain of such Funds, as listed within the Index Equity Fund Proxy Voting Policy and as disclosed in Part I of","page_number":170,"box":{"x":69,"y":264,"width":838,"height":12}},{"id":"882d0640-a03b-4cb0-a0f3-0f2dbf9ec91b","block_type":"box","text":"this SAI, follow supplemental guidelines that are applicable to certain climate and decarbonization issues (the “BIS","page_number":170,"box":{"x":68,"y":280,"width":822,"height":11}},{"id":"a5b3981d-ee88-47af-b37a-cd4a84d397b1","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines”).","page_number":170,"box":{"x":69,"y":295,"width":392,"height":11}},{"id":"32c17ea8-6f8f-4782-b614-34d70ac1673f","block_type":"box","text":"If a Fund invests in an underlying fund managed by BlackRock, the Fund will use its proxy voting policy when","page_number":170,"box":{"x":102,"y":317,"width":767,"height":12}},{"id":"d685deb2-56fb-435c-a480-14d1f207828a","block_type":"box","text":"voting on proxies for the underlying fund while the underlying fund will use its proxy voting policy when voting proxies","page_number":170,"box":{"x":68,"y":332,"width":827,"height":12}},{"id":"bde71164-ea3b-43b7-9d7b-562fb9417554","block_type":"box","text":"on investments the underlying fund holds. Therefore, the Fund may use the Active Fund Proxy Voting Policy while an","page_number":170,"box":{"x":69,"y":348,"width":819,"height":11}},{"id":"4e99e99f-8715-46bf-aec2-8cb422f64cd8","block_type":"box","text":"underlying fund may use the Index Equity Fund Proxy Voting Policy, and the opposite is also true.","page_number":170,"box":{"x":69,"y":363,"width":684,"height":11}},{"id":"2d513efd-0631-4caa-a1cb-630c6d2d000f","block_type":"box","text":"Copies of the Active Fund Proxy Voting Policy, Index Equity Fund Proxy Voting Policy, the BAIS Guidelines, the","page_number":170,"box":{"x":102,"y":385,"width":766,"height":12}},{"id":"b6e2463a-88da-45a4-9be3-6118288307ac","block_type":"box","text":"Global Principles for Benchmark Policies and the BIS Climate and Decarbonization Stewardship Guidelines are","page_number":170,"box":{"x":69,"y":401,"width":784,"height":11}},{"id":"730bd6dc-5f4f-4980-9948-ba9cf2d8c5f5","block_type":"box","text":"attached as Appendix B to this SAI. Only those guidelines that are applicable to a particular Fund pursuant to the","page_number":170,"box":{"x":69,"y":416,"width":805,"height":11}},{"id":"f22e7643-9c72-4159-89f4-7e2857ba33ce","block_type":"box","text":"Active Fund Proxy Voting Policy or the Index Equity Fund Proxy Voting Policy are considered to form a part of the","page_number":170,"box":{"x":68,"y":431,"width":790,"height":11}},{"id":"57296016-29ca-472b-9a96-0797aac4a6aa","block_type":"box","text":"Fund’s SAI. Information on how each Fund voted proxies relating to portfolio securities during the most recent 12-","page_number":170,"box":{"x":70,"y":446,"width":810,"height":11}},{"id":"5ce93995-926d-4769-bdbe-4ba495549eb5","block_type":"box","text":"month period ended June 30 is available without charge, (i) at www.blackrock.com/proxyrecords and (ii) on the","page_number":170,"box":{"x":69,"y":461,"width":788,"height":11}},{"id":"a421ed04-c9f9-4c24-b4d9-11bb393f97a0","block_type":"box","text":"Commission’s website at http://www.sec.gov.","page_number":170,"box":{"x":69,"y":476,"width":327,"height":11}},{"id":"b7ccf363-b510-40f8-83bf-3e6581078f93","block_type":"box","text":"GENERAL INFORMATION","page_number":170,"box":{"x":391,"y":506,"width":195,"height":9}},{"id":"d114c2ea-85f3-4437-b23e-4012d7e74e37","block_type":"box","text":"Description of Shares","page_number":170,"box":{"x":69,"y":536,"width":156,"height":11}},{"id":"76e51204-f3c7-4109-a0ed-f446d97c419b","block_type":"box","text":"Shareholders of a Fund are entitled to one vote for each full share held and fractional votes for fractional shares","page_number":170,"box":{"x":102,"y":559,"width":800,"height":9}},{"id":"27664ac9-8649-466b-98f2-75e8999dc679","block_type":"box","text":"held in the election of Directors and generally on other matters submitted to the vote of shareholders of the Fund.","page_number":170,"box":{"x":69,"y":574,"width":811,"height":11}},{"id":"505a6c6d-4e3f-460c-84f3-b5dfce9682df","block_type":"box","text":"Shareholders of a class that bears distribution and/or service expenses have exclusive voting rights with respect to","page_number":170,"box":{"x":69,"y":589,"width":825,"height":11}},{"id":"7f0e6a2f-9e3f-42bc-b380-6758f492d77f","block_type":"box","text":"matters relating to such distribution and service expenditures. Voting rights are not cumulative, so that the holders of","page_number":170,"box":{"x":69,"y":604,"width":838,"height":11}},{"id":"01b84840-8c77-493a-81bc-58dda4e29343","block_type":"box","text":"more than 50% of the shares voting in the election of Directors can, if they choose to do so, elect all the Directors of","page_number":170,"box":{"x":69,"y":619,"width":835,"height":11}},{"id":"ffc51b24-8bc6-4bc5-b92e-c27dc4c38c4a","block_type":"box","text":"a Fund, in which event the holders of the remaining shares would be unable to elect any person as a Director.","page_number":170,"box":{"x":69,"y":634,"width":781,"height":12}},{"id":"5ff72cec-11bb-4a60-9c6b-e0713393cc09","block_type":"box","text":"No Fund intends to hold annual meetings of shareholders in any year in which the Investment Company Act does","page_number":170,"box":{"x":102,"y":657,"width":801,"height":11}},{"id":"1ed88c0c-dd0f-4f14-bbb2-7ad3b7e2c3c6","block_type":"box","text":"not require shareholders to act upon any of the following matters: (i) election of Directors; (ii) approval of a","page_number":170,"box":{"x":69,"y":672,"width":760,"height":11}},{"id":"7080c14a-bc4e-4144-95ad-e2f5e0157ea7","block_type":"box","text":"management agreement; (iii) approval of a distribution agreement; and (iv) ratification of selection of independent","page_number":170,"box":{"x":69,"y":687,"width":810,"height":11}},{"id":"85c11b2d-0b8a-4b17-87e5-5410b951c5f3","block_type":"box","text":"accountants. Shares issued are fully paid and non-assessable and have no preemptive rights. Redemption and","page_number":170,"box":{"x":69,"y":702,"width":790,"height":12}},{"id":"8d310152-9dff-4b68-b3bf-ab129a188feb","block_type":"box","text":"conversion rights are discussed elsewhere herein and in each Fund’s Prospectus. Each share of each class of","page_number":170,"box":{"x":69,"y":717,"width":787,"height":12}},{"id":"cc5b5ea9-17fe-4be9-92e6-2d0804b0923d","block_type":"box","text":"Common Stock is entitled to participate equally in dividends and distributions declared by a Fund and in the net","page_number":170,"box":{"x":69,"y":733,"width":797,"height":11}},{"id":"1dd185a5-6171-428a-a84d-0208e96c133a","block_type":"box","text":"assets of the Fund upon liquidation or dissolution after satisfaction of outstanding liabilities.","page_number":170,"box":{"x":69,"y":748,"width":658,"height":11}},{"id":"9ee40efd-b883-4306-a2ed-3a229ce8a892","block_type":"box","text":"For Funds organized as Maryland corporations, the by-laws of the Fund require that a special meeting of","page_number":170,"box":{"x":102,"y":770,"width":741,"height":12}},{"id":"54e43642-771e-4352-8ddd-b879860108ba","block_type":"box","text":"shareholders be held upon the written request of a minimum percentage of the outstanding shares of the Fund","page_number":170,"box":{"x":69,"y":785,"width":790,"height":12}},{"id":"fb0e2848-3dc1-4b4c-9fa8-fc2ac077723d","block_type":"box","text":"entitled to vote at such meeting, if they comply with applicable Maryland law.","page_number":170,"box":{"x":69,"y":801,"width":546,"height":11}},{"id":"dd46b290-bf5e-4684-9700-b96c7d943e66","block_type":"box","text":"Certain of the Funds are organized as “Massachusetts business trusts.” Under Massachusetts law,","page_number":170,"box":{"x":102,"y":823,"width":712,"height":12}},{"id":"9a76cb59-4e3f-4f58-9783-878f6d65f9f0","block_type":"box","text":"shareholders of such a trust may, under certain circumstances, be held personally liable as partners for its","page_number":170,"box":{"x":69,"y":838,"width":765,"height":11}},{"id":"63046189-3782-4692-89e6-2372219a24c4","block_type":"box","text":"obligations. However, the Declaration of Trust establishing a trust, a copy of which for each applicable Fund, together","page_number":170,"box":{"x":69,"y":853,"width":834,"height":12}},{"id":"c3b78675-643b-4384-9b50-191438bfdf3f","block_type":"box","text":"with all amendments thereto (the “Declaration of Trust”), is on file in the office of the Secretary of the","page_number":170,"box":{"x":68,"y":869,"width":729,"height":11}},{"id":"82530f74-fc95-40a7-b40b-daa178eb43f4","block_type":"box","text":"Commonwealth of Massachusetts, contains an express disclaimer of shareholder liability for acts or obligations of","page_number":170,"box":{"x":69,"y":884,"width":815,"height":11}},{"id":"585416cb-4dad-4f18-a93f-34ea28cf8f33","block_type":"box","text":"the trust and provides for indemnification and reimbursement of expenses out of the trust property for any","page_number":170,"box":{"x":68,"y":899,"width":761,"height":11}},{"id":"e79ff039-5f68-4805-b526-31533297f5af","block_type":"box","text":"II-139","page_number":170,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"24d8b344-e402-4368-85d5-041617b19a95","block_type":"box","text":"NM0926U-5977317-170/232","page_number":170,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"1a7dffd6-c418-496a-99ec-c6d780a4952e","block_type":"box","text":"shareholder held personally liable for the obligations of the trust. The Declaration of Trust also provides that a trust","page_number":171,"box":{"x":69,"y":45,"width":824,"height":11}},{"id":"8c7b4b9d-4684-4c62-869e-4d7dfb44da21","block_type":"box","text":"may maintain appropriate insurance (for example, fidelity bond and errors and omissions insurance) for the protection","page_number":171,"box":{"x":69,"y":60,"width":839,"height":11}},{"id":"d0f95cc5-6bec-4da0-9b65-fc9b205f7f76","block_type":"box","text":"of the trust, its shareholders, trustees, officers, employees and agents covering possible tort and other liabilities.","page_number":171,"box":{"x":69,"y":75,"width":813,"height":11}},{"id":"2cc78901-a3bd-47ef-90db-a70e124cc85d","block_type":"box","text":"Thus, the risk of a shareholder incurring financial loss on account of shareholder liability is limited to circumstances","page_number":171,"box":{"x":68,"y":90,"width":827,"height":11}},{"id":"b8ef8702-2fb6-4fa8-aae9-b5a14a93cb74","block_type":"box","text":"in which both inadequate insurance existed and the trust itself was unable to meet its obligations.","page_number":171,"box":{"x":70,"y":105,"width":699,"height":11}},{"id":"c20ded7c-1516-4060-aa4b-7ce2414e11ef","block_type":"box","text":"Certain Funds are organized as Delaware statutory trusts.","page_number":171,"box":{"x":102,"y":128,"width":413,"height":11}},{"id":"05c81723-684e-48f7-bfed-67d039bf08e0","block_type":"box","text":"Additional Information","page_number":171,"box":{"x":68,"y":158,"width":161,"height":9}},{"id":"6da85aec-d2d2-4b41-bcdb-2633014c5227","block_type":"box","text":"Under a separate agreement, BlackRock has granted certain Funds the right to use the “BlackRock” name and","page_number":171,"box":{"x":102,"y":181,"width":789,"height":11}},{"id":"457bb0f1-430d-4252-b02d-6b584196202f","block_type":"box","text":"has reserved the right to (i) withdraw its consent to the use of such name by a Fund if the Fund ceases to retain","page_number":171,"box":{"x":69,"y":196,"width":799,"height":11}},{"id":"2295238c-a907-4b22-9027-605e3e2fb62e","block_type":"box","text":"BlackRock Advisors, LLC or BlackRock Fund Advisors, as applicable, as investment adviser and (ii) to grant the use of","page_number":171,"box":{"x":70,"y":211,"width":837,"height":11}},{"id":"c1d184e9-542a-4c4c-8324-f2745478e52d","block_type":"box","text":"such name to any other company.","page_number":171,"box":{"x":69,"y":226,"width":238,"height":11}},{"id":"8cf2c01a-ecd3-40b7-ad25-72be860716e4","block_type":"box","text":"II-140","page_number":171,"box":{"x":468,"y":943,"width":42,"height":9}},{"id":"ecc8372f-9ecc-4ddb-9547-92737b9840ce","block_type":"box","text":"NM0926U-5977317-171/232","page_number":171,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"bf291bf1-7a00-4953-889e-a4bee9c949ff","block_type":"box","text":"APPENDIX A","page_number":172,"box":{"x":438,"y":45,"width":101,"height":10}},{"id":"002e05ec-a4d2-4bd6-ae7f-cdfa13b6ba74","block_type":"box","text":"Description of Bond Ratings","page_number":172,"box":{"x":377,"y":68,"width":224,"height":13}},{"id":"fbb2c159-0228-47fa-b78f-0fac2c0f0d44","block_type":"box","text":"A rating is generally assigned to a fixed-income security at the time of issuance by a credit rating agency","page_number":172,"box":{"x":101,"y":91,"width":743,"height":12}},{"id":"d147201e-c568-4064-a94c-23b06870357d","block_type":"box","text":"designated as a nationally recognized statistical rating organization (“NRSRO”) by the Securities and Exchange","page_number":172,"box":{"x":69,"y":106,"width":787,"height":12}},{"id":"895c3804-31f4-437e-a23f-9b046d013808","block_type":"box","text":"Commission (“SEC”). While NRSROs may from time to time revise such ratings, they undertake no obligation to do","page_number":172,"box":{"x":69,"y":121,"width":817,"height":12}},{"id":"2ef701c9-a144-411b-90e2-2bd926120e01","block_type":"box","text":"so, and the ratings given to securities at issuance do not necessarily represent ratings which would be given to these","page_number":172,"box":{"x":69,"y":137,"width":837,"height":11}},{"id":"89f6e8cd-b3f4-4ebf-93cd-49e039f8ab4a","block_type":"box","text":"securities on a particular subsequent date.","page_number":172,"box":{"x":69,"y":152,"width":306,"height":11}},{"id":"086e1bff-1db1-4bc8-a54a-abbef0183181","block_type":"box","text":"NRSROs may rate specific investments (","page_number":172,"box":{"x":102,"y":174,"width":286,"height":12}},{"id":"055110d6-4769-4949-ac3d-965c39a5f112","block_type":"box","text":"e.g.","page_number":172,"box":{"x":390,"y":176,"width":25,"height":10}},{"id":"6f2ea6b9-f88c-4044-bdd5-7dabbabb9bb6","block_type":"box","text":", bonds), issuers (","page_number":172,"box":{"x":417,"y":175,"width":128,"height":10}},{"id":"61a3aabf-591a-4bc9-930d-22a897824af1","block_type":"box","text":"e.g.","page_number":172,"box":{"x":547,"y":176,"width":25,"height":10}},{"id":"f3984a82-fc00-43de-aee7-e661b3ac7787","block_type":"box","text":", corporations, governments and financial","page_number":172,"box":{"x":574,"y":174,"width":293,"height":12}},{"id":"a5a36614-4ac7-4a24-ae7c-2c3d5920eb91","block_type":"box","text":"institutions) and/or programs (","page_number":172,"box":{"x":70,"y":190,"width":217,"height":11}},{"id":"97908c83-4fcc-4d28-9a57-699b406ed7b2","block_type":"box","text":"e.g.","page_number":172,"box":{"x":289,"y":191,"width":25,"height":10}},{"id":"fbc251b6-4001-4976-be0c-7e3441a4cbcc","block_type":"box","text":", commercial paper programs). However, certain types of investments may not be","page_number":172,"box":{"x":317,"y":189,"width":578,"height":12}},{"id":"1b9c395d-9107-425b-8099-71dbe13f75e1","block_type":"box","text":"rated by NRSROs, such as certain government/sovereign obligations, US agency securities, commercial paper, time","page_number":172,"box":{"x":69,"y":205,"width":826,"height":11}},{"id":"afbd2f4a-6fbc-4a38-a9a6-d0466caf6d46","block_type":"box","text":"deposits at financial institutions, and derivative instruments such as credit default swaps. For these types of","page_number":172,"box":{"x":69,"y":220,"width":777,"height":11}},{"id":"d829a577-c2b2-4879-ac30-a9ca32e0d25f","block_type":"box","text":"investments, as well as US Treasury securities (some of which are not rated), where an NRSRO has not rated the","page_number":172,"box":{"x":70,"y":235,"width":807,"height":11}},{"id":"0bcbafae-7197-4792-a4ac-fcbeb5c27efa","block_type":"box","text":"specific investment but has rated the investment’s issuer, program, financial institution or underlying reference","page_number":172,"box":{"x":69,"y":250,"width":791,"height":11}},{"id":"ecff30f1-4bfb-48cc-97d2-b1591ef40f3f","block_type":"box","text":"asset, BlackRock Advisors, LLC, BlackRock Fund Advisors or their respective affiliates (“BlackRock”) may consider","page_number":172,"box":{"x":69,"y":265,"width":816,"height":11}},{"id":"8f44007e-8ffe-4a23-9cb1-16f1e966443f","block_type":"box","text":"the investment to have the same NRSRO rating as its issuer, program, financial institution or underlying reference","page_number":172,"box":{"x":68,"y":280,"width":812,"height":12}},{"id":"28486cf8-8aba-4168-925e-52a00d561b21","block_type":"box","text":"asset, as applicable. In the case of municipal securities, where one NRSRO provides multiple ratings for the same","page_number":172,"box":{"x":69,"y":295,"width":815,"height":12}},{"id":"0e457a21-6036-4276-add3-5e463ddd60a9","block_type":"box","text":"security (","page_number":172,"box":{"x":69,"y":311,"width":63,"height":11}},{"id":"aa173875-87ed-44d1-96b0-8dc133ff4d19","block_type":"box","text":"e.g.","page_number":172,"box":{"x":134,"y":312,"width":25,"height":10}},{"id":"8275b6a7-d0af-4d93-8b5b-20ad88ecb8c5","block_type":"box","text":", “underlying,” “insured” and/or “enhanced” ratings), BlackRock may consider the security to have the","page_number":172,"box":{"x":161,"y":311,"width":730,"height":11}},{"id":"7d68c3f6-9404-40d3-b26c-db1331a2f7c3","block_type":"box","text":"highest of the multiple ratings.","page_number":172,"box":{"x":69,"y":326,"width":216,"height":11}},{"id":"ca706a40-0006-4673-9d9e-7accda9c725b","block_type":"box","text":"New issue securities (regardless of type) may not be rated by an NRSRO at the time of their initial offering.","page_number":172,"box":{"x":102,"y":348,"width":760,"height":12}},{"id":"59052686-a052-4223-9c97-4a30f0e0a876","block_type":"box","text":"Preliminary prospectuses or term sheets for new issue securities may include an expected rating for the security (as","page_number":172,"box":{"x":69,"y":363,"width":830,"height":12}},{"id":"c8d63acf-5c01-48d9-b48c-dc9686c4a2a8","block_type":"box","text":"determined by the underwriter and/or issuer) or an NRSRO rating for the issuer of the security. If applicable, when","page_number":172,"box":{"x":69,"y":378,"width":812,"height":12}},{"id":"3d14ae75-5e4f-4913-891d-0cd739abc50f","block_type":"box","text":"deciding whether to purchase a new issue security that has not yet been rated by an NRSRO, BlackRock may","page_number":172,"box":{"x":69,"y":394,"width":776,"height":11}},{"id":"f886010a-547e-418d-ae44-b89c1403804c","block_type":"box","text":"attribute an expected rating to the security based on: (i) the expected rating of the security set forth in the","page_number":172,"box":{"x":69,"y":409,"width":756,"height":11}},{"id":"1091436c-9c65-4d24-a8e1-2377facafc24","block_type":"box","text":"preliminary prospectus or term sheet for the security; (ii) the NRSRO’s rating for the issuer of the security set forth in","page_number":172,"box":{"x":70,"y":424,"width":835,"height":11}},{"id":"8c03efe1-7052-4f5f-8348-169c1b2c9d28","block_type":"box","text":"the preliminary prospectus or term sheet for the security; or (iii) with respect to asset-backed securities, the rating of","page_number":172,"box":{"x":68,"y":439,"width":836,"height":11}},{"id":"d04cdfea-cb4e-4c9e-9ea9-30665ccb885a","block_type":"box","text":"a prior issuance having a similar structure or the same sponsor.","page_number":172,"box":{"x":69,"y":454,"width":456,"height":11}},{"id":"509f2e14-6f9d-4405-9c94-80ebb14f8dac","block_type":"box","text":"Where the investment objective of a fund is to track the performance of an index that includes credit ratings","page_number":172,"box":{"x":101,"y":477,"width":771,"height":11}},{"id":"15b3caf6-d23c-46a7-961c-96aac54b26b0","block_type":"box","text":"eligibility criteria as part of its index methodology, the fund may purchase any security within the index, such security","page_number":172,"box":{"x":69,"y":492,"width":832,"height":11}},{"id":"c4928b30-2001-4d05-84da-767d15839312","block_type":"box","text":"having been determined by the index provider as meeting its credit ratings eligibility criteria. The credit ratings","page_number":172,"box":{"x":69,"y":507,"width":782,"height":11}},{"id":"a78c2ded-dad2-4eb9-97e8-cf0388983356","block_type":"box","text":"practices of an index provider may differ from BlackRock’s practices, as described above. Further, the fund may","page_number":172,"box":{"x":70,"y":522,"width":796,"height":11}},{"id":"8781d030-4d4e-49c6-94e3-3b8adfc2e03a","block_type":"box","text":"invest, directly or indirectly, in securities that are not rated by a rating agency or securities with a credit rating that","page_number":172,"box":{"x":70,"y":537,"width":811,"height":12}},{"id":"51c94c65-9694-4a8a-b84b-a5007f23f14e","block_type":"box","text":"differs from the credit rating specified in its index methodology in various circumstances, including where a security is","page_number":172,"box":{"x":69,"y":552,"width":840,"height":12}},{"id":"3f65123a-d5c3-473e-81e6-317ded8e1170","block_type":"box","text":"downgraded but not yet removed from an index, following the removal of a security from an index prior to its sale by","page_number":172,"box":{"x":69,"y":567,"width":824,"height":12}},{"id":"5af9c00c-ff81-423d-979d-d66b36faf40a","block_type":"box","text":"the fund or as a result of a corporate action or restructuring affecting an issuer of a security held by the fund.","page_number":172,"box":{"x":68,"y":583,"width":781,"height":11}},{"id":"d34cb48e-7a3f-4503-b66f-a727d659565e","block_type":"box","text":"Fixed-income securities which are unrated may expose the investor to risks with respect to capacity to pay","page_number":172,"box":{"x":102,"y":606,"width":756,"height":10}},{"id":"15100bea-c6bb-4646-b1a7-ef094e63dedd","block_type":"box","text":"interest or repay principal which are similar to the risks of lower-rated speculative bonds (although BlackRock may","page_number":172,"box":{"x":70,"y":620,"width":811,"height":12}},{"id":"41e75a20-040f-4121-a7fc-fedb3581157d","block_type":"box","text":"deem such unrated securities to be of higher quality). Evaluation of these securities is dependent on BlackRock’s","page_number":172,"box":{"x":69,"y":635,"width":809,"height":12}},{"id":"195c3853-fdc3-44f0-914c-747bd8467c2f","block_type":"box","text":"judgment, analysis and experience in the evaluation of such securities.","page_number":172,"box":{"x":67,"y":651,"width":506,"height":11}},{"id":"8425fdb5-67f6-45ae-a380-397c70d59092","block_type":"box","text":"Investors should note that the assignment of a rating to a security by an NRSRO may not reflect the effect of","page_number":172,"box":{"x":102,"y":673,"width":776,"height":12}},{"id":"80e4031e-287e-494f-9fb0-2fbcb292ad6f","block_type":"box","text":"recent developments on the issuer’s ability to make interest and principal payments or on the likelihood of default.","page_number":172,"box":{"x":69,"y":688,"width":818,"height":12}},{"id":"75612068-2d0c-4647-be14-dd64e8506a66","block_type":"box","text":"Securities deemed to be high yield are rated below Baa3 by Moody’s and below BBB- by S&P Global Ratings and","page_number":172,"box":{"x":102,"y":711,"width":799,"height":11}},{"id":"47d34d63-ba13-43fb-8095-7b1e2c09634e","block_type":"box","text":"Fitch. Other terms used to describe such securities include “lower rated bonds,” “non-investment grade bonds,”","page_number":172,"box":{"x":70,"y":726,"width":798,"height":11}},{"id":"c0be828a-d133-40a8-a445-47605e046a67","block_type":"box","text":"“below investment grade bonds,” and “junk bonds.”","page_number":172,"box":{"x":70,"y":742,"width":368,"height":11}},{"id":"5a0989b7-ab0d-4857-ab6d-bb5f590dfb78","block_type":"box","text":"The descriptions below relate to general long-term and short-term obligations of an issuer.","page_number":172,"box":{"x":101,"y":764,"width":643,"height":11}},{"id":"448dc3d6-e24e-4d34-9b6a-889045f0c941","block_type":"box","text":"A Description of Moody’s Investors Service, Inc.’s (“Moody’s”) Global Rating Scales","page_number":172,"box":{"x":68,"y":794,"width":616,"height":11}},{"id":"a5816af6-0db6-4806-8e9c-a1761f4f68f5","block_type":"box","text":"Credit ratings are assigned on Moody’s global long-term and short-term rating scales and are forward-looking","page_number":172,"box":{"x":102,"y":817,"width":777,"height":11}},{"id":"f5cd6a57-1f11-49b9-a6a5-e5e5762ef225","block_type":"box","text":"opinions of the relative credit risks of financial obligations issued by non-financial corporates, financial institutions,","page_number":172,"box":{"x":69,"y":832,"width":818,"height":11}},{"id":"df316520-a3fa-46f7-8c88-c5a34a6e4f47","block_type":"box","text":"structured finance vehicles, project finance vehicles, and public sector entities. Moody’s defines credit risk as the","page_number":172,"box":{"x":69,"y":847,"width":812,"height":11}},{"id":"22052891-fa89-451e-98ba-3549c8911d99","block_type":"box","text":"risk that an entity may not meet its contractual financial obligations as they come due and any estimated financial","page_number":172,"box":{"x":69,"y":862,"width":812,"height":12}},{"id":"1c45be4a-6895-482b-a926-688cf3c940e6","block_type":"box","text":"loss in the event of default or impairment. The contractual financial obligations addressed by Moody’s ratings are","page_number":172,"box":{"x":70,"y":877,"width":807,"height":12}},{"id":"143299d9-ecc3-4f68-86e5-fd797b42578f","block_type":"box","text":"those that call for, without regard to enforceability, the payment of an ascertainable amount, which may vary based","page_number":172,"box":{"x":68,"y":892,"width":821,"height":12}},{"id":"3849d6cf-b4cf-4e4f-b163-c3531fb219fb","block_type":"box","text":"upon standard sources of variation (","page_number":172,"box":{"x":69,"y":908,"width":257,"height":11}},{"id":"eb00d074-1a2c-4340-87a5-48eea9a07a1d","block_type":"box","text":"e.g.","page_number":172,"box":{"x":328,"y":909,"width":25,"height":10}},{"id":"b542ac06-7ae0-42d3-8880-b06c0146add0","block_type":"box","text":", floating interest rates), by an ascertainable date. Moody’s rating addresses","page_number":172,"box":{"x":355,"y":908,"width":548,"height":11}},{"id":"6a6b0225-53c8-4080-9206-8f95325ca48b","block_type":"box","text":"A-1","page_number":172,"box":{"x":477,"y":943,"width":24,"height":9}},{"id":"1d693412-f9c6-4cf4-a716-839f9dba11cb","block_type":"box","text":"NM0926U-5977317-172/232","page_number":172,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"59e36a8d-2482-4b50-8e3e-0dfd962221cc","block_type":"box","text":"the issuer’s ability to obtain cash sufficient to service the obligation, and its willingness to pay. Moody’s ratings do","page_number":173,"box":{"x":68,"y":45,"width":821,"height":11}},{"id":"056dfd95-6b7b-43e5-a271-777bdab24d8a","block_type":"box","text":"not address non-standard sources of variation in the amount of the principal obligation (","page_number":173,"box":{"x":69,"y":60,"width":627,"height":11}},{"id":"836c06ed-0c4b-49bf-95c7-18b57a7acede","block_type":"box","text":"e.g.","page_number":173,"box":{"x":697,"y":61,"width":25,"height":10}},{"id":"b4a8fb66-0a82-40e2-b931-aebe5bcba141","block_type":"box","text":", equity indexed), absent","page_number":173,"box":{"x":725,"y":60,"width":174,"height":11}},{"id":"d578965c-1694-4b19-821a-04b7859587df","block_type":"box","text":"an express statement to the contrary in a press release accompanying an initial rating. Long-term ratings are","page_number":173,"box":{"x":69,"y":75,"width":777,"height":11}},{"id":"fbdf34cf-302e-44f6-9877-fde6ed1fc97a","block_type":"box","text":"assigned to issuers or obligations with an original maturity of eleven months or more and reflect both on the","page_number":173,"box":{"x":69,"y":90,"width":771,"height":11}},{"id":"1bba0f95-f38a-48b8-95c4-ad6d620a6301","block_type":"box","text":"likelihood of a default or impairment on contractual financial obligations and the expected financial loss suffered in","page_number":173,"box":{"x":70,"y":105,"width":819,"height":11}},{"id":"7394c940-5a4c-4db3-8c21-f45d9aa09ebc","block_type":"box","text":"the event of default or impairment. Short-term ratings are assigned for obligations with an original maturity of thirteen","page_number":173,"box":{"x":68,"y":120,"width":840,"height":12}},{"id":"cc7fad3e-e5dd-4e30-8b53-bf7832901c53","block_type":"box","text":"months or less and reflect both on the likelihood of a default or impairment on contractual financial obligations and","page_number":173,"box":{"x":69,"y":135,"width":822,"height":12}},{"id":"c3972ab3-7d25-4df3-ab43-f8ff8aea4ec1","block_type":"box","text":"the expected financial loss suffered in the event of default or impairment. Moody’s issues ratings at the issuer level","page_number":173,"box":{"x":68,"y":150,"width":829,"height":12}},{"id":"058e2048-e195-4fc9-8091-c2f57df94472","block_type":"box","text":"and instrument level on both the long-term scale and the short-term scale. Typically, ratings are made publicly","page_number":173,"box":{"x":69,"y":166,"width":784,"height":11}},{"id":"46686206-bbdd-4411-b277-bd475201d402","block_type":"box","text":"available although private and unpublished ratings may also be assigned.","page_number":173,"box":{"x":69,"y":181,"width":521,"height":11}},{"id":"8755535d-8974-47b8-aa5c-63da1164ea36","block_type":"box","text":"Moody’s differentiates structured finance ratings from fundamental ratings (","page_number":173,"box":{"x":102,"y":203,"width":542,"height":12}},{"id":"26630669-d20e-477e-9674-ddc2e520f25d","block_type":"box","text":"i.e.","page_number":173,"box":{"x":646,"y":204,"width":20,"height":8}},{"id":"503642fb-69a3-4133-bc2a-0573aa40e9cc","block_type":"box","text":", ratings on nonfinancial","page_number":173,"box":{"x":669,"y":203,"width":169,"height":12}},{"id":"99138b23-8ed4-410e-9afd-d701eba4e32a","block_type":"box","text":"corporate, financial institution, and public sector entities) on the global long-term scale by adding (sf) to all structured","page_number":173,"box":{"x":69,"y":218,"width":837,"height":12}},{"id":"2f271a87-b843-4182-880c-91e52732f26d","block_type":"box","text":"finance ratings. The addition of (sf) to structured finance ratings should eliminate any presumption that such ratings","page_number":173,"box":{"x":68,"y":234,"width":828,"height":11}},{"id":"d2edd736-4e3b-4ec8-af31-94c976b198a0","block_type":"box","text":"and fundamental ratings at the same letter grade level will behave the same. The (sf) indicator for structured finance","page_number":173,"box":{"x":69,"y":249,"width":832,"height":11}},{"id":"d9f5fcab-ec0a-4d08-a897-9e9d0409b06d","block_type":"box","text":"security ratings indicates that otherwise similarly rated structured finance and fundamental securities may have","page_number":173,"box":{"x":69,"y":264,"width":797,"height":11}},{"id":"0242a43d-d532-4fbd-9242-f14bb0b49b42","block_type":"box","text":"different risk characteristics. Through its current methodologies, however, Moody’s aspires to achieve broad","page_number":173,"box":{"x":69,"y":279,"width":771,"height":11}},{"id":"70787b21-8774-4503-8366-b30420c72c34","block_type":"box","text":"expected equivalence in structured finance and fundamental rating performance when measured over a long period","page_number":173,"box":{"x":69,"y":294,"width":821,"height":11}},{"id":"9503625a-ca25-45d3-831a-c4a3e22a9c8e","block_type":"box","text":"of time.","page_number":173,"box":{"x":69,"y":309,"width":53,"height":9}},{"id":"c9def184-c085-47c0-9609-67a01bd3504b","block_type":"box","text":"Description of Moody’s Global Long-Term Rating Scale","page_number":173,"box":{"x":69,"y":339,"width":395,"height":12}},{"id":"5443d7ad-fda3-4dd3-99eb-96d964f74e83","block_type":"box","text":"Aaa Obligations rated Aaa are judged to be of the highest quality, subject to the lowest level of credit","page_number":173,"box":{"x":68,"y":367,"width":815,"height":11}},{"id":"b0e98061-615f-4886-a993-dd71930f5189","block_type":"box","text":"risk.","page_number":173,"box":{"x":197,"y":383,"width":28,"height":8}},{"id":"6565034e-8084-4e75-b3e3-56d4ffdb6ea9","block_type":"box","text":"Aa Obligations rated Aa are judged to be of high quality and are subject to very low credit risk.","page_number":173,"box":{"x":68,"y":402,"width":773,"height":12}},{"id":"0eb49f7b-a944-469f-9f13-3450a5af9b9e","block_type":"box","text":"A Obligations rated A are judged to be upper-medium grade and are subject to low credit risk.","page_number":173,"box":{"x":68,"y":423,"width":776,"height":11}},{"id":"9dd66235-6581-4950-abf5-5a99e71c764c","block_type":"box","text":"Baa Obligations rated Baa are judged to be medium-grade and subject to moderate credit risk and as","page_number":173,"box":{"x":70,"y":443,"width":813,"height":11}},{"id":"09a0f635-e623-42d5-a25a-ffe98aeaba63","block_type":"box","text":"such may possess certain speculative characteristics.","page_number":173,"box":{"x":196,"y":458,"width":385,"height":11}},{"id":"1a346ce7-33f0-4645-a60a-16357a747595","block_type":"box","text":"Ba Obligations rated Ba are judged to be speculative and are subject to substantial credit risk.","page_number":173,"box":{"x":70,"y":478,"width":775,"height":11}},{"id":"e87c5fac-f12f-4a0c-90a0-1cf0f5cc40fc","block_type":"box","text":"B Obligations rated B are considered speculative and are subject to high credit risk.","page_number":173,"box":{"x":70,"y":498,"width":707,"height":11}},{"id":"94b7249e-5922-4977-a9b9-f54656b9f54a","block_type":"box","text":"Caa Obligations rated Caa are judged to be speculative of poor standing and are subject to very high","page_number":173,"box":{"x":69,"y":518,"width":810,"height":12}},{"id":"5f9cf578-83bb-4660-a7e7-23746a371e27","block_type":"box","text":"credit risk.","page_number":173,"box":{"x":196,"y":534,"width":74,"height":8}},{"id":"a9fecc60-cbd6-4744-a33a-4bcbf2d431f7","block_type":"box","text":"Ca Obligations rated Ca are highly speculative and are likely in, or very near, default, with some","page_number":173,"box":{"x":69,"y":554,"width":783,"height":11}},{"id":"16a07c58-3fea-4689-b8c8-54d15fc92b6c","block_type":"box","text":"prospect of recovery of principal and interest.","page_number":173,"box":{"x":197,"y":569,"width":322,"height":11}},{"id":"7dd45fd1-9eb4-4ad3-8f27-afefaf85dde4","block_type":"box","text":"C Obligations rated C are the lowest rated and are typically in default, with little prospect for recovery","page_number":173,"box":{"x":69,"y":589,"width":834,"height":11}},{"id":"d4ff8830-92e7-4f71-8487-8546a4c5ab09","block_type":"box","text":"of principal or interest.","page_number":173,"box":{"x":196,"y":604,"width":160,"height":11}},{"id":"cb72405d-0cfe-4716-99c2-0fa2cde60ef5","block_type":"box","text":"Note:","page_number":173,"box":{"x":102,"y":624,"width":37,"height":9}},{"id":"56603d0d-1866-4721-8d36-a5e4a4fbae94","block_type":"box","text":"Moody’s appends numerical modifiers 1, 2, and 3 to each generic rating classification from Aa through","page_number":173,"box":{"x":146,"y":624,"width":731,"height":11}},{"id":"34617207-46ff-4d34-bda4-57dc881ccbc7","block_type":"box","text":"Caa. The modifier 1 indicates that the obligation ranks in the higher end of its generic rating category; the modifier 2","page_number":173,"box":{"x":69,"y":639,"width":831,"height":12}},{"id":"1abbede8-4c80-4b88-a6f0-be93bed1bd27","block_type":"box","text":"indicates a mid-range ranking; and the modifier 3 indicates a ranking in the lower end of that generic rating category.","page_number":173,"box":{"x":70,"y":654,"width":829,"height":12}},{"id":"5c62bd2f-1e67-4611-90f6-e660be193ff4","block_type":"box","text":"Additionally, a “(hyb)” indicator is appended to all ratings of hybrid securities issued by banks, insurers, finance","page_number":173,"box":{"x":68,"y":669,"width":795,"height":12}},{"id":"89e3bfb9-9979-4a23-aa5f-df7398c4bf94","block_type":"box","text":"companies, and securities firms.","page_number":173,"box":{"x":69,"y":685,"width":232,"height":11}},{"id":"fec3b054-9926-4fcd-ba79-c5d6db33dfb4","block_type":"box","text":"By their terms, hybrid securities allow for the omission of scheduled dividends, interest, or principal payments,","page_number":173,"box":{"x":102,"y":707,"width":787,"height":11}},{"id":"a985ccc5-2f39-49b6-821b-752920182b4d","block_type":"box","text":"which can potentially result in impairment if such an omission occurs. Hybrid securities may also be subject to","page_number":173,"box":{"x":68,"y":722,"width":788,"height":12}},{"id":"343d35a9-cb2e-4815-967b-6be049e97327","block_type":"box","text":"contractually allowable write-downs of principal that could result in impairment. Together with the hybrid indicator, the","page_number":173,"box":{"x":69,"y":738,"width":833,"height":11}},{"id":"b3bc81d4-6a20-4239-a3a2-dacef526f0d8","block_type":"box","text":"long-term obligation rating assigned to a hybrid security is an expression of the relative credit risk associated with","page_number":173,"box":{"x":70,"y":753,"width":809,"height":11}},{"id":"eab9ab45-22ba-48a4-9ded-59878671968d","block_type":"box","text":"that security.","page_number":173,"box":{"x":68,"y":768,"width":91,"height":11}},{"id":"f1d7e3ab-2256-4b36-87e3-d96c7ade227c","block_type":"box","text":"Description of Moody’s Global Short-Term Rating Scale","page_number":173,"box":{"x":69,"y":798,"width":400,"height":11}},{"id":"7aefe61a-e883-435c-81c6-a12a48563aec","block_type":"box","text":"P-1 Ratings of Prime-1 reflect a superior ability to repay short-term obligations.","page_number":173,"box":{"x":69,"y":826,"width":658,"height":11}},{"id":"11751b33-19de-416f-b680-3d07d800c916","block_type":"box","text":"P-2 Ratings of Prime-2 reflect a strong ability to repay short-term obligations.","page_number":173,"box":{"x":69,"y":846,"width":645,"height":11}},{"id":"f584cfda-abea-4fe0-8be6-350aa8b5e0e8","block_type":"box","text":"P-3 Ratings of Prime-3 reflect an acceptable ability to repay short-term obligations.","page_number":173,"box":{"x":69,"y":866,"width":686,"height":11}},{"id":"54d75d7f-7ccf-4d9a-936e-a31ced6c6bcb","block_type":"box","text":"NP Issuers (or supporting institutions) rated Not Prime do not fall within any of the Prime rating","page_number":173,"box":{"x":70,"y":886,"width":778,"height":12}},{"id":"a0a9d7b5-2b58-4757-9260-e5e8e7101b22","block_type":"box","text":"categories.","page_number":173,"box":{"x":196,"y":902,"width":77,"height":11}},{"id":"b8b062e9-0880-439b-b08a-0ca73adde7f9","block_type":"box","text":"A-2","page_number":173,"box":{"x":477,"y":943,"width":23,"height":9}},{"id":"38c6e57b-0272-4737-8f4d-3720ba3f7445","block_type":"box","text":"NM0926U-5977317-173/232","page_number":173,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"859ecf0f-3d04-4f4b-8662-c5988fd1d16d","block_type":"box","text":"Description of Moody’s U.S. Municipal Short-Term Debt and Demand Obligation Ratings","page_number":174,"box":{"x":69,"y":45,"width":637,"height":11}},{"id":"1f6274e0-6fca-4ade-8835-8da622888244","block_type":"box","text":"Moody’s uses the global short-term Prime rating scale for commercial paper issued by U.S. municipalities and","page_number":174,"box":{"x":102,"y":67,"width":784,"height":12}},{"id":"007bee29-5826-41fd-9ba6-58b73bc67a62","block_type":"box","text":"nonprofits. These commercial paper programs may be backed by external letters of credit or liquidity facilities, or by","page_number":174,"box":{"x":69,"y":82,"width":824,"height":12}},{"id":"2420a90a-3ef2-4b54-b190-a3dd1d45cd69","block_type":"box","text":"an issuer’s self-liquidity.","page_number":174,"box":{"x":69,"y":98,"width":170,"height":11}},{"id":"c6cd4e33-83b0-485a-9e1f-18240e09ebe1","block_type":"box","text":"For other short-term municipal obligations, Moody’s uses one of two other short-term rating scales, the","page_number":174,"box":{"x":102,"y":120,"width":736,"height":12}},{"id":"78368f82-7aec-4933-9506-6596eb42d624","block_type":"box","text":"Municipal Investment Grade (“MIG”) and Variable Municipal Investment Grade (“VMIG”) scales discussed below.","page_number":174,"box":{"x":70,"y":135,"width":796,"height":11}},{"id":"819396be-8ad0-453c-9723-14bced0d8788","block_type":"box","text":"MIG Ratings","page_number":174,"box":{"x":102,"y":158,"width":85,"height":11}},{"id":"1492bf03-cfa6-418c-94b3-a51db839ec49","block_type":"box","text":"Moody’s uses the MIG scale for U.S. municipal cash flow notes, bond anticipation notes and certain other short","page_number":174,"box":{"x":102,"y":181,"width":803,"height":11}},{"id":"fea8561e-10e8-4c4d-9b01-b1cd09686182","block_type":"box","text":"term obligations, which typically mature in three years or less. Under certain circumstances, Moody’s uses the MIG","page_number":174,"box":{"x":68,"y":196,"width":823,"height":11}},{"id":"b939b18e-d5f1-46fd-8a1d-db4727465cdf","block_type":"box","text":"scale for bond anticipation notes with maturities of up to five years.","page_number":174,"box":{"x":69,"y":211,"width":480,"height":11}},{"id":"8cf6457b-88d7-43da-a14c-8870ab087469","block_type":"box","text":"MIG Scale","page_number":174,"box":{"x":102,"y":234,"width":71,"height":9}},{"id":"d284a864-bc7e-4b7c-a3e1-7c1fbaeeb929","block_type":"box","text":"MIG 1 This designation denotes superior credit quality. Excellent protection is afforded by established","page_number":174,"box":{"x":70,"y":261,"width":802,"height":12}},{"id":"f7813108-5a4d-427f-b185-28f3fa577597","block_type":"box","text":"cash flows, highly reliable liquidity support, or demonstrated broad-based access to the market for","page_number":174,"box":{"x":196,"y":276,"width":703,"height":12}},{"id":"c4650176-9eea-4a3e-9125-1b6057b1ca94","block_type":"box","text":"refinancing.","page_number":174,"box":{"x":197,"y":292,"width":80,"height":11}},{"id":"ace9261f-37a7-4035-adaa-b0c9ac8c3bff","block_type":"box","text":"MIG 2 This designation denotes strong credit quality. Margins of protection are ample, although not as","page_number":174,"box":{"x":70,"y":312,"width":809,"height":11}},{"id":"bb453f17-b284-475c-bf5e-ea54f65db613","block_type":"box","text":"large as in the preceding group.","page_number":174,"box":{"x":197,"y":327,"width":224,"height":11}},{"id":"6f2fc539-4314-4535-9a9f-8c6838788ce7","block_type":"box","text":"MIG 3 This designation denotes acceptable credit quality. Liquidity and cash-flow protection may be","page_number":174,"box":{"x":70,"y":347,"width":785,"height":11}},{"id":"480dc3cd-0880-4d3a-923c-b7ea709b3a12","block_type":"box","text":"narrow, and market access for refinancing is likely to be less well-established.","page_number":174,"box":{"x":197,"y":362,"width":554,"height":11}},{"id":"cc90d048-fc38-4588-ab51-170c473477a6","block_type":"box","text":"SG This designation denotes speculative-grade credit quality. Debt instruments in this category may","page_number":174,"box":{"x":69,"y":382,"width":813,"height":12}},{"id":"dc1d680a-82a3-4d23-bb0f-579dada707dd","block_type":"box","text":"lack sufficient margins of protection.","page_number":174,"box":{"x":197,"y":397,"width":259,"height":12}},{"id":"e6745ee3-e7a4-4482-ad9a-1ad5ec4aca4a","block_type":"box","text":"VMIG Ratings","page_number":174,"box":{"x":68,"y":425,"width":100,"height":11}},{"id":"8a55e09b-5876-42c5-b716-66d934f33339","block_type":"box","text":"In the case of variable rate demand obligations (“VRDOs”), a two-component rating is assigned. The components","page_number":174,"box":{"x":102,"y":448,"width":804,"height":11}},{"id":"936c5210-9646-4f18-8051-54cdaf24206c","block_type":"box","text":"are a long-term rating and a short-term payment obligation rating. The long-term rating addresses the issuer’s ability","page_number":174,"box":{"x":69,"y":463,"width":829,"height":11}},{"id":"54c5df27-4567-421a-97d1-168d974f2116","block_type":"box","text":"to meet scheduled principal and interest payments. The short-term payment obligation rating addresses the ability of","page_number":174,"box":{"x":68,"y":478,"width":836,"height":11}},{"id":"9fa6fd60-8d42-4d5f-96d4-dd8f6d57541e","block_type":"box","text":"the issuer or the liquidity provider meet any purchase-price payment obligation resulting from optional tenders (“on","page_number":174,"box":{"x":68,"y":493,"width":817,"height":11}},{"id":"d2bff0ff-5731-4c32-9533-46078c21d149","block_type":"box","text":"demand”) and/or mandatory tenders of the VRDO. The short-term demand obligation rating uses the VMIG scale.","page_number":174,"box":{"x":69,"y":508,"width":807,"height":12}},{"id":"a638e7f8-1f36-41fd-a4b7-ad7eac7d56c5","block_type":"box","text":"VMIG ratings with liquidity support use as an input the short-term Counterparty Risk Assessment of the support","page_number":174,"box":{"x":68,"y":523,"width":800,"height":12}},{"id":"dd52b95a-8ef6-4bef-bbd6-e4b2e1cda220","block_type":"box","text":"provider, or the long-term rating of the underlying obligor in the absence of third party liquidity support. Transitions of","page_number":174,"box":{"x":70,"y":538,"width":832,"height":12}},{"id":"7ca0a47c-9833-42e1-8e44-5c8dc4a1a38d","block_type":"box","text":"VMIG ratings of demand obligations with conditional liquidity support differ from transitions on the Prime scale to","page_number":174,"box":{"x":68,"y":554,"width":807,"height":11}},{"id":"78cba378-2b24-41ee-9cf6-d7f9752be934","block_type":"box","text":"reflect the risk that external liquidity support will terminate if the issuer’s long-term rating drops below investment","page_number":174,"box":{"x":69,"y":569,"width":812,"height":11}},{"id":"dc027ef3-1de7-4fb7-9f4b-b7203ef16e55","block_type":"box","text":"grade.","page_number":174,"box":{"x":68,"y":584,"width":43,"height":11}},{"id":"d288041f-c882-4ad8-8c97-a2c1fb4db96e","block_type":"box","text":"Moody’s typically assigns the VMIG short-term demand obligation rating if the frequency of the demand feature is","page_number":174,"box":{"x":102,"y":606,"width":807,"height":12}},{"id":"2379cb68-8435-46a1-808b-e79ad613d77d","block_type":"box","text":"less than every three years. If the frequency of the demand feature is less than three years but the purchase price is","page_number":174,"box":{"x":70,"y":622,"width":833,"height":11}},{"id":"0cd6aaaa-23be-490e-b16f-d125f71854de","block_type":"box","text":"payable only with remarketing proceeds, the short-term demand obligation rating is “NR”.","page_number":174,"box":{"x":70,"y":637,"width":635,"height":11}},{"id":"f70c24b4-3aa4-4e09-b3b9-58f4f76d036a","block_type":"box","text":"Industrial development bonds in the US where the obligor is a corporate may carry a VMIG rating that reflects","page_number":174,"box":{"x":102,"y":659,"width":778,"height":12}},{"id":"18688c62-98a3-4cdc-84d1-4a7b1122458e","block_type":"box","text":"Moody’s view of the relative likelihood of default and loss. In these cases, liquidity assessment is based on the","page_number":174,"box":{"x":70,"y":675,"width":795,"height":11}},{"id":"7da18361-d036-4602-8a5b-790f3fbc1500","block_type":"box","text":"liquidity of the corporate obligor.","page_number":174,"box":{"x":70,"y":690,"width":226,"height":11}},{"id":"26b1aa6a-e725-45e0-ad32-9456e54d59f3","block_type":"box","text":"VMIG Scale","page_number":174,"box":{"x":101,"y":712,"width":81,"height":9}},{"id":"ae40eb61-74f3-4acd-83bc-060ebe6da9c2","block_type":"box","text":"VMIG 1 This designation denotes superior credit quality. Excellent protection is afforded by the superior","page_number":174,"box":{"x":68,"y":740,"width":808,"height":11}},{"id":"d1220e43-f1c8-4540-a53c-17b075b2ff49","block_type":"box","text":"short-term credit strength of the liquidity provider and structural and legal protections.","page_number":174,"box":{"x":196,"y":755,"width":613,"height":11}},{"id":"65a02d7a-d1d5-49fc-ade6-1897b5078a8e","block_type":"box","text":"VMIG 2 This designation denotes strong credit quality. Good protection is afforded by the strong short-term","page_number":174,"box":{"x":68,"y":775,"width":834,"height":12}},{"id":"cd49e6d7-9991-45c2-b647-fae2792e95f8","block_type":"box","text":"credit strength of the liquidity provider and structural and legal protections.","page_number":174,"box":{"x":196,"y":790,"width":533,"height":12}},{"id":"3b4094aa-c56d-45a5-9427-9ced137b317a","block_type":"box","text":"VMIG 3 This designation denotes acceptable credit quality. Adequate protection is afforded by the","page_number":174,"box":{"x":68,"y":811,"width":768,"height":11}},{"id":"715f3a16-e432-423a-b00f-83867f0b5c76","block_type":"box","text":"satisfactory short-term credit strength of the liquidity provider and structural and legal protections.","page_number":174,"box":{"x":196,"y":826,"width":701,"height":11}},{"id":"654ba21f-6f37-410b-aeb3-fd34919a8a8f","block_type":"box","text":"SG This designation denotes speculative-grade credit quality. Demand features rated in this category","page_number":174,"box":{"x":69,"y":846,"width":820,"height":11}},{"id":"6e736153-5697-4db3-b514-8336835154d9","block_type":"box","text":"may be supported by a liquidity provider that does not have a sufficiently strong short-term rating or","page_number":174,"box":{"x":197,"y":861,"width":711,"height":11}},{"id":"ee3480bf-a675-43ac-984b-0274b6bede40","block_type":"box","text":"may lack the structural or legal protections.","page_number":174,"box":{"x":197,"y":876,"width":308,"height":11}},{"id":"c15f1ee9-ba9f-4e45-8ecd-b6a7746d208f","block_type":"box","text":"A-3","page_number":174,"box":{"x":477,"y":943,"width":23,"height":9}},{"id":"4edf4230-195b-4373-a869-f141a985be21","block_type":"box","text":"NM0926U-5977317-174/232","page_number":174,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"eedb6182-f579-4792-b699-35f2b2aad975","block_type":"box","text":"Description of S&P Global Ratings (“S&P”), a Division of S&P Global Inc., Issue Credit Ratings","page_number":175,"box":{"x":69,"y":45,"width":691,"height":11}},{"id":"f7401790-691e-4fe7-aa89-2c3c99e75684","block_type":"box","text":"An S&P issue credit rating is a forward-looking opinion about the creditworthiness of an obligor with respect to a","page_number":175,"box":{"x":101,"y":67,"width":801,"height":12}},{"id":"171d4ded-33a3-4eae-a6c9-22bc2363858d","block_type":"box","text":"specific financial obligation, a specific class of financial obligations, or a specific financial program (including ratings","page_number":175,"box":{"x":69,"y":82,"width":829,"height":12}},{"id":"f05f422b-79df-40f6-a9f5-caa883fd7688","block_type":"box","text":"on medium-term note programs and commercial paper programs). It takes into consideration the creditworthiness of","page_number":175,"box":{"x":69,"y":98,"width":831,"height":11}},{"id":"9e176726-4f0c-4788-932d-2ad342b1a799","block_type":"box","text":"guarantors, insurers, or other forms of credit enhancement on the obligation and takes into account the currency in","page_number":175,"box":{"x":68,"y":113,"width":823,"height":11}},{"id":"4ce1ca25-d69e-440c-9bd5-73bcb67c7a21","block_type":"box","text":"which the obligation is denominated. The opinion reflects S&P’s view of the obligor’s capacity and willingness to meet","page_number":175,"box":{"x":68,"y":128,"width":841,"height":11}},{"id":"d8a4692e-6577-4367-864d-d1885a70c2bf","block_type":"box","text":"its financial commitments as they come due, and this opinion may assess terms, such as collateral security and","page_number":175,"box":{"x":70,"y":143,"width":801,"height":11}},{"id":"ed825197-3add-4cea-9ce2-e1332e0d5b13","block_type":"box","text":"subordination, which could affect ultimate payment in the event of default.","page_number":175,"box":{"x":69,"y":158,"width":530,"height":11}},{"id":"d970b8bc-5930-49cd-9754-fa957c111a85","block_type":"box","text":"Issue credit ratings can be either long-term or short-term. Short-term issue credit ratings are generally assigned","page_number":175,"box":{"x":102,"y":181,"width":796,"height":11}},{"id":"ac83fcdb-3bf7-4ee8-955c-74efaf373f21","block_type":"box","text":"to those obligations considered short-term in the relevant market, typically with an original maturity of no more than","page_number":175,"box":{"x":68,"y":196,"width":825,"height":11}},{"id":"a9ea4e7a-a1c5-4975-978a-309de2a4a543","block_type":"box","text":"365 days. Short-term issue credit ratings are also used to indicate the creditworthiness of an obligor with respect to","page_number":175,"box":{"x":69,"y":211,"width":832,"height":11}},{"id":"a8c06274-486c-4823-9ee5-ca26a8875fad","block_type":"box","text":"put features on long-term obligations. S&P would typically assign a long-term issue credit rating to an obligation with","page_number":175,"box":{"x":70,"y":226,"width":826,"height":11}},{"id":"a19d79ce-36c5-47ff-8bd8-d27ffa360d9b","block_type":"box","text":"an original maturity of greater than 365 days. However, the ratings S&P assigns to certain instruments may diverge","page_number":175,"box":{"x":69,"y":241,"width":823,"height":11}},{"id":"9dff1984-7e99-407a-b7a9-7730a4c7da89","block_type":"box","text":"from these guidelines based on market practices.","page_number":175,"box":{"x":68,"y":256,"width":354,"height":12}},{"id":"4144c1ed-a956-45fc-9b42-993aed051c11","block_type":"box","text":"Issue credit ratings are based, in varying degrees, on S&P’s analysis of the following considerations:","page_number":175,"box":{"x":102,"y":279,"width":718,"height":11}},{"id":"cc78496a-5eff-44ac-9fcb-3cf9342419a3","block_type":"box","text":"•","page_number":175,"box":{"x":69,"y":302,"width":6,"height":5}},{"id":"e377a181-4427-469b-9bca-f2705e233e73","block_type":"box","text":"The likelihood of payment—the capacity and willingness of the obligor to meet its financial commitments on an","page_number":175,"box":{"x":101,"y":299,"width":790,"height":11}},{"id":"31eacf13-79ad-4658-a024-d443f1b6f185","block_type":"box","text":"obligation in accordance with the terms of the obligation;","page_number":175,"box":{"x":102,"y":314,"width":404,"height":12}},{"id":"6c205d47-cff3-4d35-9458-16c88be6421d","block_type":"box","text":"•","page_number":175,"box":{"x":69,"y":337,"width":6,"height":5}},{"id":"655b2b13-8ed8-4d02-a800-2ef49cd17983","block_type":"box","text":"The nature and provisions of the financial obligation, and the promise S&P imputes; and","page_number":175,"box":{"x":101,"y":334,"width":629,"height":12}},{"id":"9042167b-d0ef-456c-a667-d5d6f601b9f8","block_type":"box","text":"•","page_number":175,"box":{"x":69,"y":357,"width":6,"height":5}},{"id":"71067a28-800a-4ca6-8a4a-be41a3b2d13b","block_type":"box","text":"The protection afforded by, and relative position of, the financial obligation in the event of a bankruptcy,","page_number":175,"box":{"x":101,"y":355,"width":738,"height":11}},{"id":"d3067e7a-d8ab-4d44-bb8d-d8801ae4cade","block_type":"box","text":"reorganization, or other arrangement under the laws of bankruptcy and other laws affecting creditors’ rights.","page_number":175,"box":{"x":102,"y":370,"width":770,"height":11}},{"id":"56bcc98e-3b86-470f-808e-1cf8017ba2ab","block_type":"box","text":"An issue rating is an assessment of default risk but may incorporate an assessment of relative seniority or","page_number":175,"box":{"x":101,"y":392,"width":763,"height":12}},{"id":"9df6f697-ed79-4f81-a0cf-bb57df5443c9","block_type":"box","text":"ultimate recovery in the event of default. Junior obligations are typically rated lower than senior obligations, to reflect","page_number":175,"box":{"x":69,"y":407,"width":833,"height":12}},{"id":"13d1a310-d916-481c-b01b-e577b503fbb5","block_type":"box","text":"lower priority in bankruptcy, as noted above. (Such differentiation may apply when an entity has both senior and","page_number":175,"box":{"x":70,"y":423,"width":794,"height":11}},{"id":"8caa7cef-a971-47b3-a54a-a2d6e646f3ed","block_type":"box","text":"subordinated obligations, secured and unsecured obligations, or operating company and holding company","page_number":175,"box":{"x":69,"y":438,"width":754,"height":11}},{"id":"201f207f-ae20-4e2d-9d35-32d6b438d301","block_type":"box","text":"obligations.)","page_number":175,"box":{"x":69,"y":453,"width":86,"height":11}},{"id":"e22c92ec-dc31-4de2-902d-45a43e2ba9e6","block_type":"box","text":"Long-Term Issue Credit Ratings*","page_number":175,"box":{"x":69,"y":483,"width":236,"height":11}},{"id":"17e4f482-a59f-4ed1-ab4f-354804bb5044","block_type":"box","text":"AAA An obligation rated ‘AAA’ has the highest rating assigned by S&P. The obligor’s capacity to meet its","page_number":175,"box":{"x":68,"y":511,"width":833,"height":11}},{"id":"e0cc00ed-cbe2-4564-ab0d-f54d45e88e38","block_type":"box","text":"financial commitments on the obligation is extremely strong.","page_number":175,"box":{"x":196,"y":526,"width":429,"height":11}},{"id":"df5af94d-62b2-484c-9cfc-608c0f6f1c9d","block_type":"box","text":"AA An obligation rated ‘AA’ differs from the highest-rated obligations only to a small degree. The","page_number":175,"box":{"x":68,"y":546,"width":788,"height":11}},{"id":"0e1e4148-d178-4d18-b7ed-7684ce75efb5","block_type":"box","text":"obligor’s capacity to meet its financial commitments on the obligation is very strong.","page_number":175,"box":{"x":196,"y":561,"width":602,"height":11}},{"id":"4067e220-d8c4-49bd-a366-e98a34d0d451","block_type":"box","text":"A An obligation rated ‘A’ is somewhat more susceptible to the adverse effects of changes in","page_number":175,"box":{"x":68,"y":581,"width":770,"height":12}},{"id":"07cf9227-59e6-40a4-8040-fbf79c242a27","block_type":"box","text":"circumstances and economic conditions than obligations in higher-rated categories. However, the","page_number":175,"box":{"x":196,"y":597,"width":692,"height":11}},{"id":"87d90539-e2bb-4e8e-b561-9dbeb240126a","block_type":"box","text":"obligor’s capacity to meet its financial commitments on the obligation is still strong.","page_number":175,"box":{"x":196,"y":612,"width":598,"height":11}},{"id":"b2b062f0-4451-431d-a20a-b7326bf2dc0c","block_type":"box","text":"BBB An obligation rated ‘BBB’ exhibits adequate protection parameters. However, adverse economic","page_number":175,"box":{"x":70,"y":632,"width":806,"height":11}},{"id":"b397026a-f928-470a-ba28-cd85b0c1266b","block_type":"box","text":"conditions or changing circumstances are more likely to weaken the obligor’s capacity to meet its","page_number":175,"box":{"x":196,"y":647,"width":694,"height":11}},{"id":"0fce777f-ae9e-4cc5-8986-c09a36f00d4a","block_type":"box","text":"financial commitments on the obligation.","page_number":175,"box":{"x":196,"y":662,"width":289,"height":11}},{"id":"1ea3b9fc-a4d7-4c7a-857d-376dc60486f9","block_type":"box","text":"BB,","page_number":175,"box":{"x":70,"y":682,"width":22,"height":11}},{"id":"7bbc160f-1d64-4819-bba6-e35ad3c76bec","block_type":"box","text":"B,","page_number":175,"box":{"x":70,"y":697,"width":12,"height":11}},{"id":"da4d5660-83eb-46e8-8d1c-b87a17bb9047","block_type":"box","text":"CCC,","page_number":175,"box":{"x":69,"y":712,"width":33,"height":11}},{"id":"2e94ed58-bf1c-493f-bcfb-599a1493aa81","block_type":"box","text":"CC,","page_number":175,"box":{"x":69,"y":728,"width":23,"height":10}},{"id":"75418396-086b-46d3-be2f-e97a03ab73e0","block_type":"box","text":"and C","page_number":175,"box":{"x":69,"y":743,"width":40,"height":9}},{"id":"f6649590-dc55-4688-bcf9-6cc68b8efebc","block_type":"box","text":"Obligations rated ‘BB’, ‘B’, ‘CCC’, ‘CC’, and ‘C’ are regarded as having significant speculative","page_number":175,"box":{"x":196,"y":682,"width":667,"height":11}},{"id":"f38317e0-97d2-41f7-98a0-a6b69ee42a6e","block_type":"box","text":"characteristics. ‘BB’ indicates the least degree of speculation and ‘C’ the highest. While such","page_number":175,"box":{"x":196,"y":697,"width":667,"height":12}},{"id":"7413fd4c-a629-436c-92eb-0851e142e822","block_type":"box","text":"obligations will likely have some quality and protective characteristics, these may be outweighed by","page_number":175,"box":{"x":196,"y":713,"width":707,"height":11}},{"id":"26cdcf9c-8f83-4020-b224-f30385f4dd42","block_type":"box","text":"large uncertainties or major exposure to adverse conditions.","page_number":175,"box":{"x":197,"y":728,"width":428,"height":11}},{"id":"32fbd1bb-d451-4d6f-9b84-3efaf90a7153","block_type":"box","text":"BB An obligation rated ‘BB’ is less vulnerable to nonpayment than other speculative issues. However, it","page_number":175,"box":{"x":70,"y":763,"width":838,"height":11}},{"id":"a966fd01-e102-4895-9f23-299abc7edf84","block_type":"box","text":"faces major ongoing uncertainties or exposure to adverse business, financial, or economic","page_number":175,"box":{"x":196,"y":778,"width":646,"height":11}},{"id":"eed274b0-21de-4e9c-8036-7308c0dd2fc0","block_type":"box","text":"conditions that could lead to the obligor’s inadequate capacity to meet its financial commitments","page_number":175,"box":{"x":196,"y":793,"width":692,"height":11}},{"id":"8dbe568a-13c5-4aa2-8280-2d5586232268","block_type":"box","text":"on the obligation.","page_number":175,"box":{"x":196,"y":808,"width":122,"height":11}},{"id":"948fb17b-76cc-4a1e-b702-34f31a574897","block_type":"box","text":"B An obligation rated ‘B’ is more vulnerable to nonpayment than obligations rated ‘BB’, but the obligor","page_number":175,"box":{"x":70,"y":828,"width":840,"height":12}},{"id":"c9c0ea1d-9897-4e89-ab71-34a310c6b3f5","block_type":"box","text":"currently has the capacity to meet its financial commitments on the obligation. Adverse business,","page_number":175,"box":{"x":196,"y":843,"width":695,"height":12}},{"id":"07dc5192-c80f-4b1e-9443-097ee926e359","block_type":"box","text":"financial, or economic conditions will likely impair the obligor’s capacity or willingness to meet its","page_number":175,"box":{"x":196,"y":858,"width":691,"height":12}},{"id":"7a7fedc0-6194-4896-b2b6-e92cafd65cad","block_type":"box","text":"financial commitments on the obligation.","page_number":175,"box":{"x":196,"y":874,"width":289,"height":11}},{"id":"23ecf469-becf-416f-a7de-ebfe8eab45b0","block_type":"box","text":"A-4","page_number":175,"box":{"x":477,"y":943,"width":24,"height":9}},{"id":"be07edaa-0a64-419f-82a8-105e01dd4741","block_type":"box","text":"NM0926U-5977317-175/232","page_number":175,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"46afa59b-81df-4cba-bbe1-9629593a2340","block_type":"box","text":"CCC An obligation rated ‘CCC’ is currently vulnerable to nonpayment and is dependent upon favorable","page_number":176,"box":{"x":69,"y":48,"width":816,"height":12}},{"id":"10cdc75f-c34c-4e71-bca5-b908d20bb637","block_type":"box","text":"business, financial, and economic conditions for the obligor to meet its financial commitments on","page_number":176,"box":{"x":196,"y":63,"width":695,"height":12}},{"id":"6e05cd50-abd4-4239-b9f9-68970e351352","block_type":"box","text":"the obligation. In the event of adverse business, financial, or economic conditions, the obligor is","page_number":176,"box":{"x":195,"y":79,"width":687,"height":11}},{"id":"50c8f6a0-c311-43f2-97ee-8c06534f7b3b","block_type":"box","text":"not likely to have the capacity to meet its financial commitments on the obligation.","page_number":176,"box":{"x":197,"y":94,"width":586,"height":11}},{"id":"eb7ba918-fea2-49f6-a7a0-8fe884b7f986","block_type":"box","text":"CC An obligation rated ‘CC’ is currently highly vulnerable to nonpayment. The ‘CC’ rating is used when","page_number":176,"box":{"x":69,"y":114,"width":826,"height":11}},{"id":"e90a57fa-6b8a-4b7d-a386-b49d2e716b35","block_type":"box","text":"a default has not yet occurred but S&P expects default to be a virtual certainty, regardless of the","page_number":176,"box":{"x":196,"y":129,"width":692,"height":11}},{"id":"e077a55f-c9fc-4587-be39-cd9f767b68eb","block_type":"box","text":"anticipated time to default.","page_number":176,"box":{"x":196,"y":144,"width":191,"height":11}},{"id":"8965d6a5-5516-4a30-bbb7-e2005691a88c","block_type":"box","text":"C An obligation rated ‘C’ is currently highly vulnerable to nonpayment, and the obligation is expected","page_number":176,"box":{"x":69,"y":164,"width":826,"height":12}},{"id":"a28912fa-e6c7-41b9-a963-b439c777845e","block_type":"box","text":"to have lower relative seniority or lower ultimate recovery compared with obligations that are rated","page_number":176,"box":{"x":195,"y":180,"width":700,"height":11}},{"id":"d43d0838-6c13-4ba0-a585-d71ff5b72d08","block_type":"box","text":"higher.","page_number":176,"box":{"x":197,"y":195,"width":45,"height":11}},{"id":"cb65394e-f96a-4351-83f0-672aeb3692e4","block_type":"box","text":"D An obligation rated ‘D’ is in default or in breach of an imputed promise. For non-hybrid capital","page_number":176,"box":{"x":70,"y":215,"width":789,"height":11}},{"id":"2b8ea9cb-c0b7-4342-b1ae-99ec3e6ffc60","block_type":"box","text":"instruments, the ‘D’ rating category is used when payments on an obligation are not made on the","page_number":176,"box":{"x":197,"y":230,"width":695,"height":11}},{"id":"6f9e9768-bf03-483b-8442-e03bbc87f7a3","block_type":"box","text":"date due, unless S&P believes that such payments will be made within five business days in the","page_number":176,"box":{"x":196,"y":245,"width":686,"height":11}},{"id":"204c1267-7a18-42c2-a9cb-f9835d4d7fe4","block_type":"box","text":"absence of a stated grace period or within the earlier of the stated grace period or 30 calendar","page_number":176,"box":{"x":196,"y":260,"width":676,"height":11}},{"id":"8ccd743f-aa4d-4138-93fe-a77fa61a6186","block_type":"box","text":"days. The ‘D’ rating also will be used upon the filing of a bankruptcy petition or the taking of similar","page_number":176,"box":{"x":196,"y":275,"width":708,"height":11}},{"id":"e914d0e6-d434-4ae9-96a8-3f7b5fa19d20","block_type":"box","text":"action and where default on an obligation is a virtual certainty, for example due to automatic stay","page_number":176,"box":{"x":196,"y":290,"width":694,"height":12}},{"id":"e2858304-a545-4769-8ce2-0ace8e8d6cd9","block_type":"box","text":"provisions. A rating on an obligation is lowered to ‘D’ if it is subject to a distressed debt","page_number":176,"box":{"x":197,"y":305,"width":626,"height":12}},{"id":"71a1da5f-bc8f-4db8-a0bd-0323f55056cb","block_type":"box","text":"restructuring.","page_number":176,"box":{"x":197,"y":321,"width":92,"height":11}},{"id":"89af91c6-60bc-45fb-9459-fb461f641573","block_type":"box","text":"*Ratings from ‘AA’ to ‘CCC’ may be modified by the addition of a plus (+) or minus (-) sign to show relative","page_number":176,"box":{"x":103,"y":341,"width":756,"height":11}},{"id":"c8bc2676-e480-4991-9b72-2c1cbaa55108","block_type":"box","text":"standing within the rating categories.","page_number":176,"box":{"x":69,"y":356,"width":262,"height":11}},{"id":"392c7008-081c-4a01-83ec-97c2158b5778","block_type":"box","text":"Short-Term Issue Credit Ratings","page_number":176,"box":{"x":68,"y":386,"width":233,"height":11}},{"id":"0474a8da-6751-4857-af96-0b39a89b8be5","block_type":"box","text":"A-1 A short-term obligation rated ‘A-1’ is rated in the highest category by S&P. The obligor’s capacity to","page_number":176,"box":{"x":68,"y":414,"width":833,"height":11}},{"id":"2dfbf8ea-1248-4725-a220-3ca8da043fe2","block_type":"box","text":"meet its financial commitments on the obligation is strong. Within this category, certain obligations","page_number":176,"box":{"x":197,"y":429,"width":707,"height":11}},{"id":"e56b4a99-17b6-42d9-af86-b5a65a16c1b7","block_type":"box","text":"are designated with a plus sign (+). This indicates that the obligor’s capacity to meet its financial","page_number":176,"box":{"x":196,"y":444,"width":691,"height":11}},{"id":"64f6ed2e-9adb-4b05-8564-0e98e98b2ced","block_type":"box","text":"commitments on these obligations is extremely strong.","page_number":176,"box":{"x":196,"y":459,"width":390,"height":11}},{"id":"ba91eda5-0343-4d7b-869e-dddb09cc7a0a","block_type":"box","text":"A-2 A short-term obligation rated ‘A-2’ is somewhat more susceptible to the adverse effects of changes","page_number":176,"box":{"x":68,"y":479,"width":837,"height":12}},{"id":"a1327e36-e76a-4461-90d5-798849eecf69","block_type":"box","text":"in circumstances and economic conditions than obligations in higher rating categories. However,","page_number":176,"box":{"x":197,"y":495,"width":684,"height":11}},{"id":"6dd60cc4-9eb1-4d51-89a8-f4845b7f180f","block_type":"box","text":"the obligor’s capacity to meet its financial commitments on the obligation is satisfactory.","page_number":176,"box":{"x":195,"y":509,"width":634,"height":12}},{"id":"d13faa02-568f-46aa-9dd8-51d1a104de13","block_type":"box","text":"A-3 A short-term obligation rated ‘A-3’ exhibits adequate protection parameters. However, adverse","page_number":176,"box":{"x":68,"y":530,"width":798,"height":11}},{"id":"ebc62e0f-dc39-44a2-806a-f3ca75af3a61","block_type":"box","text":"economic conditions or changing circumstances are more likely to weaken an obligor’s capacity to","page_number":176,"box":{"x":196,"y":545,"width":699,"height":11}},{"id":"5167f054-cdd9-4e74-b362-41aac847566d","block_type":"box","text":"meet its financial commitments on the obligation.","page_number":176,"box":{"x":197,"y":560,"width":351,"height":11}},{"id":"4ce42fed-ada6-40d4-a454-33cc4cd50409","block_type":"box","text":"B A short-term obligation rated ‘B’ is regarded as vulnerable and has significant speculative","page_number":176,"box":{"x":70,"y":580,"width":765,"height":11}},{"id":"e511fda5-c506-49e3-8d47-6146356b6ddf","block_type":"box","text":"characteristics. The obligor currently has the capacity to meet its financial commitments; however,","page_number":176,"box":{"x":196,"y":595,"width":700,"height":11}},{"id":"f64b0473-ac48-4307-9359-4eba87ad43e2","block_type":"box","text":"it faces major ongoing uncertainties that could lead to the obligor’s inadequate capacity to meet its","page_number":176,"box":{"x":197,"y":610,"width":708,"height":12}},{"id":"b7328461-1a72-42cd-a57a-8675472c74d8","block_type":"box","text":"financial commitments.","page_number":176,"box":{"x":196,"y":625,"width":165,"height":9}},{"id":"e4227716-a6fb-4f1c-a877-160127272f43","block_type":"box","text":"C A short-term obligation rated ‘C’ is currently vulnerable to nonpayment and is dependent upon","page_number":176,"box":{"x":69,"y":646,"width":796,"height":11}},{"id":"f3ca0b34-76a9-4799-b0d3-d9d0640281e7","block_type":"box","text":"favorable business, financial, and economic conditions for the obligor to meet its financial","page_number":176,"box":{"x":196,"y":661,"width":641,"height":11}},{"id":"668ff6cb-3167-4096-bdad-9a2c77695f23","block_type":"box","text":"commitments on the obligation.","page_number":176,"box":{"x":196,"y":676,"width":224,"height":11}},{"id":"42b956e1-0982-4070-b48f-2a3974ac10e9","block_type":"box","text":"D A short-term obligation rated ‘D’ is in default or in breach of an imputed promise. For non-hybrid","page_number":176,"box":{"x":70,"y":696,"width":808,"height":11}},{"id":"3ff38149-8ced-4a6e-9015-7494a7e651ff","block_type":"box","text":"capital instruments, the ‘D’ rating category is used when payments on an obligation are not made","page_number":176,"box":{"x":196,"y":711,"width":698,"height":11}},{"id":"1d68818b-f2e4-49ea-bf2b-799a155ab1a4","block_type":"box","text":"on the date due, unless S&P believes that such payments will be made within any stated grace","page_number":176,"box":{"x":196,"y":726,"width":678,"height":12}},{"id":"88035baf-aa38-46e8-bed4-59c790f7a4f5","block_type":"box","text":"period. However, any stated grace period longer than five business days will be treated as five","page_number":176,"box":{"x":197,"y":741,"width":669,"height":12}},{"id":"cc1900c3-b6b8-4721-a413-1376ba81d03e","block_type":"box","text":"business days. The ‘D’ rating also will be used upon the filing of a bankruptcy petition or the taking","page_number":176,"box":{"x":196,"y":756,"width":707,"height":12}},{"id":"5bdbe026-987b-4181-92bc-577ebc1cef21","block_type":"box","text":"of a similar action and where default on an obligation is a virtual certainty, for example due to","page_number":176,"box":{"x":196,"y":772,"width":669,"height":11}},{"id":"9519b682-a90f-484e-a1bb-a27999cf206e","block_type":"box","text":"automatic stay provisions. A rating on an obligation is lowered to ‘D’ if it is subject to a distressed","page_number":176,"box":{"x":196,"y":787,"width":700,"height":11}},{"id":"b725044a-cf64-4a5b-9da8-257d1c9c3da9","block_type":"box","text":"debt restructuring.","page_number":176,"box":{"x":196,"y":802,"width":130,"height":11}},{"id":"ba516075-f1e9-4748-bcbd-44fc2e7ba6ea","block_type":"box","text":"Description of S&P’s Municipal Short-Term Note Ratings","page_number":176,"box":{"x":69,"y":830,"width":411,"height":11}},{"id":"1747b1b9-479f-4b36-abb1-37f9cd94f849","block_type":"box","text":"An S&P U.S. municipal note rating reflects S&P’s opinion about the liquidity factors and market access risks","page_number":176,"box":{"x":101,"y":852,"width":772,"height":11}},{"id":"366d46e8-3b5e-4867-8f90-3dee7e6092e1","block_type":"box","text":"unique to the notes. Notes due in three years or less will likely receive a note rating. Notes with an original maturity","page_number":176,"box":{"x":69,"y":868,"width":823,"height":11}},{"id":"b4f93288-4b4b-417f-825e-ffdded9a6b17","block_type":"box","text":"of more than three years will most likely receive a long-term debt rating. In determining which type of rating, if any, to","page_number":176,"box":{"x":69,"y":882,"width":832,"height":12}},{"id":"a3eaa671-ff17-4641-92b2-3c55fe106cfe","block_type":"box","text":"assign, S&P’s analysis will review the following considerations:","page_number":176,"box":{"x":69,"y":898,"width":447,"height":11}},{"id":"0cefb91a-402e-4bc3-93b2-801f0cdc33a0","block_type":"box","text":"A-5","page_number":176,"box":{"x":477,"y":943,"width":24,"height":9}},{"id":"40318fdc-4bc3-4d32-8f51-7275f5768a64","block_type":"box","text":"NM0926U-5977317-176/232","page_number":176,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"3116451a-68ee-43ad-b86c-0610c93372af","block_type":"box","text":"•","page_number":177,"box":{"x":69,"y":48,"width":6,"height":4}},{"id":"64783928-6950-4a68-b83b-7c8029b47a32","block_type":"box","text":"Amortization schedule—the larger the final maturity relative to other maturities, the more likely it will be treated","page_number":177,"box":{"x":101,"y":45,"width":796,"height":11}},{"id":"601b456e-072b-49b1-aa4a-de727bb2d109","block_type":"box","text":"as a note; and","page_number":177,"box":{"x":102,"y":60,"width":101,"height":10}},{"id":"791ba520-5fc2-4db3-98d7-60ba426a4221","block_type":"box","text":"•","page_number":177,"box":{"x":69,"y":83,"width":6,"height":4}},{"id":"214c79d2-6e2b-42c9-8978-526321d91d57","block_type":"box","text":"Source of payment—the more dependent the issue is on the market for its refinancing, the more likely it will be","page_number":177,"box":{"x":102,"y":80,"width":794,"height":11}},{"id":"3298882f-c270-4faf-b107-8fcc6d8c7f80","block_type":"box","text":"treated as a note.","page_number":177,"box":{"x":101,"y":95,"width":127,"height":9}},{"id":"91fb8db9-c69e-4f7b-aba9-e74594fbf10e","block_type":"box","text":"S&P’s municipal short-term note rating symbols are as follows:","page_number":177,"box":{"x":102,"y":118,"width":448,"height":11}},{"id":"8c75c038-42af-4f28-9af3-c3f7f8c4f3e5","block_type":"box","text":"SP-1 Strong capacity to pay principal and interest. An issue determined to possess a very strong","page_number":177,"box":{"x":69,"y":146,"width":779,"height":11}},{"id":"c6a4cce7-8713-44d3-92b5-33434fef22f5","block_type":"box","text":"capacity to pay debt service is given a plus (+) designation.","page_number":177,"box":{"x":196,"y":161,"width":422,"height":11}},{"id":"f4d5d747-6222-428d-9d10-496e113cc860","block_type":"box","text":"SP-2 Satisfactory capacity to pay principal and interest, with some vulnerability to adverse financial and","page_number":177,"box":{"x":69,"y":181,"width":825,"height":11}},{"id":"03d5840c-2b28-4433-b432-fa19f1f2498e","block_type":"box","text":"economic changes over the term of the notes.","page_number":177,"box":{"x":196,"y":196,"width":327,"height":11}},{"id":"9812c392-6017-4cb4-b15c-31362e0cae64","block_type":"box","text":"SP-3 Speculative capacity to pay principal and interest.","page_number":177,"box":{"x":69,"y":216,"width":479,"height":11}},{"id":"38c193fa-0e8d-4135-a04e-3fa407dc2a9e","block_type":"box","text":"D ‘D’ is assigned upon failure to pay the note when due, completion of a distressed debt","page_number":177,"box":{"x":70,"y":236,"width":745,"height":11}},{"id":"4cf44238-0c0c-42fc-895d-def6aa3dc36e","block_type":"box","text":"restructuring, or the filing of a bankruptcy petition or the taking of similar action and where default","page_number":177,"box":{"x":197,"y":251,"width":699,"height":12}},{"id":"179f380b-a3f0-4f6b-9d85-f51d0157b869","block_type":"box","text":"on an obligation is a virtual certainty, for example due to automatic stay provisions.","page_number":177,"box":{"x":196,"y":266,"width":594,"height":12}},{"id":"768e33d8-d62b-41ed-8db3-7e9941120320","block_type":"box","text":"Description of Fitch Ratings’ (“Fitch”) Credit Ratings Scales","page_number":177,"box":{"x":69,"y":294,"width":442,"height":11}},{"id":"be27f677-e4f9-4e2e-97bb-ece4b254ef55","block_type":"box","text":"Fitch publishes credit ratings that are forward-looking opinions on the relative ability of an entity or obligation to","page_number":177,"box":{"x":102,"y":317,"width":793,"height":11}},{"id":"31464eae-f45e-4f97-a57b-846c729d43dd","block_type":"box","text":"meet financial commitments. Issuer default ratings (IDRs) are assigned to corporations, sovereign entities, financial","page_number":177,"box":{"x":69,"y":332,"width":826,"height":11}},{"id":"c5c3b0b0-cd16-4cb8-b50f-f09a40d171bb","block_type":"box","text":"institutions such as banks, leasing companies and insurers, and public finance entities (local and regional","page_number":177,"box":{"x":70,"y":347,"width":756,"height":11}},{"id":"a9ef9eb9-8abd-426e-bf6a-f02aaea95c5a","block_type":"box","text":"governments). Issue level ratings are also assigned, often include an expectation of recovery and may be notched","page_number":177,"box":{"x":68,"y":362,"width":813,"height":11}},{"id":"6dab12a1-f4a7-46d1-812d-266992330d97","block_type":"box","text":"above or below the issuer level rating. Issue ratings are assigned to secured and unsecured debt securities, loans,","page_number":177,"box":{"x":69,"y":377,"width":819,"height":12}},{"id":"3fd271d8-0f8b-4eab-aecf-468f1b8d9963","block_type":"box","text":"preferred stock and other instruments, Structured finance ratings are issue ratings to securities backed by","page_number":177,"box":{"x":70,"y":392,"width":760,"height":12}},{"id":"4277a79a-850d-4673-8826-d622f22a6d36","block_type":"box","text":"receivables or other financial assets that consider the obligations’ relative vulnerability to default.","page_number":177,"box":{"x":69,"y":407,"width":694,"height":12}},{"id":"ade54847-84de-4675-964f-b825025d58da","block_type":"box","text":"Fitch’s credit ratings relating to issuers are an opinion on the relative ability of an entity to meet financial","page_number":177,"box":{"x":102,"y":430,"width":747,"height":11}},{"id":"7cead22a-eed8-4ad7-a7c9-c5a9aa71cf8c","block_type":"box","text":"commitments, such as interest, preferred dividends, repayment of principal, insurance claims or counterparty","page_number":177,"box":{"x":69,"y":445,"width":782,"height":11}},{"id":"ea332292-a077-40f1-a4c9-2de50ae604c9","block_type":"box","text":"obligations. Credit ratings relating to securities and obligations of an issuer can include a recovery expectation.","page_number":177,"box":{"x":69,"y":460,"width":793,"height":12}},{"id":"8a8f77f8-7d50-420b-a3b6-d899073add71","block_type":"box","text":"Credit ratings are used by investors as indications of the likelihood of receiving the money owed to them in","page_number":177,"box":{"x":69,"y":475,"width":761,"height":12}},{"id":"31b02973-7fbb-45e6-9c41-c1f8ed44ffab","block_type":"box","text":"accordance with the terms on which they invested. The agency’s credit ratings cover the global spectrum of","page_number":177,"box":{"x":69,"y":491,"width":766,"height":11}},{"id":"da1fe7d3-7ef0-41a7-ad7c-d4a5e725d386","block_type":"box","text":"corporate, sovereign financial, bank, insurance, and public finance entities (including supranational and sub-national","page_number":177,"box":{"x":69,"y":506,"width":827,"height":11}},{"id":"57d04a20-aea0-4601-901b-e39c688535c4","block_type":"box","text":"entities) and the securities or other obligations they issue, as well as structured finance securities backed by","page_number":177,"box":{"x":69,"y":521,"width":779,"height":11}},{"id":"29b458eb-ed44-49a1-ae05-7284d8041aec","block_type":"box","text":"receivables or other financial assets.","page_number":177,"box":{"x":69,"y":536,"width":262,"height":9}},{"id":"42d2a715-d904-4eb4-a909-653142cce2d6","block_type":"box","text":"The terms “investment grade” and “speculative grade” have established themselves over time as shorthand to","page_number":177,"box":{"x":101,"y":559,"width":794,"height":11}},{"id":"e214a016-3564-45ed-ab1d-9d00f5831205","block_type":"box","text":"describe the categories ‘AAA’ to ‘BBB’ (investment grade) and ‘BB’ to ‘D’ (speculative grade). The terms investment","page_number":177,"box":{"x":69,"y":574,"width":826,"height":11}},{"id":"7a2281e1-fb91-49d2-902f-7e7c98323bfe","block_type":"box","text":"grade and speculative grade are market conventions and do not imply any recommendation or endorsement of a","page_number":177,"box":{"x":68,"y":589,"width":800,"height":11}},{"id":"9de9f258-b9c8-4d57-b068-766925882dd2","block_type":"box","text":"specific security for investment purposes. Investment grade categories indicate relatively low to moderate credit risk,","page_number":177,"box":{"x":69,"y":604,"width":832,"height":11}},{"id":"7b0e32d8-2e07-40f7-a468-6ac44c766120","block_type":"box","text":"while ratings in the speculative categories either signal a higher level of credit risk or that a default has already","page_number":177,"box":{"x":68,"y":619,"width":793,"height":11}},{"id":"92b46da2-3ae2-4a0d-bd61-99521d7a545c","block_type":"box","text":"occurred.","page_number":177,"box":{"x":69,"y":634,"width":65,"height":9}},{"id":"acf02be9-714e-4dd3-b66e-1346479778fa","block_type":"box","text":"Fitch may also include issues relating to a rated issuer that are not and have not been rated on its web page.","page_number":177,"box":{"x":102,"y":657,"width":779,"height":11}},{"id":"d05ba836-6e5e-4434-a7f7-ce047a665798","block_type":"box","text":"Such issues are also denoted as ‘NR’.","page_number":177,"box":{"x":69,"y":672,"width":274,"height":9}},{"id":"84817c12-f956-4b2e-971f-a5f6e94fcf11","block_type":"box","text":"Credit ratings express risk in relative rank order, which is to say they are ordinal measures of credit risk and are","page_number":177,"box":{"x":102,"y":695,"width":797,"height":11}},{"id":"ac98ccc7-3aad-45f9-9721-9bdfc3e823fa","block_type":"box","text":"not predictive of a specific frequency of default or loss.","page_number":177,"box":{"x":69,"y":710,"width":391,"height":11}},{"id":"df9a85a5-d2a0-4c1d-bcc9-d164996bb681","block_type":"box","text":"Fitch’s credit ratings do not directly address any risk other than credit risk. In particular, ratings do not deal with","page_number":177,"box":{"x":102,"y":733,"width":798,"height":11}},{"id":"e21fb6a8-866c-4c2c-96c2-c1da286be85a","block_type":"box","text":"the risk of a market value loss on a rated security due to changes in interest rates, liquidity and other market","page_number":177,"box":{"x":68,"y":748,"width":780,"height":11}},{"id":"a921149f-8120-4b9e-8411-444cdd2e636b","block_type":"box","text":"considerations. However, in terms of payment obligation on the rated liability, market risk may be considered to the","page_number":177,"box":{"x":69,"y":763,"width":821,"height":11}},{"id":"50755f73-9c8a-4e79-91a9-8c2838a4f4c1","block_type":"box","text":"extent that it influences the ability of an issuer to pay upon a commitment.","page_number":177,"box":{"x":69,"y":778,"width":531,"height":11}},{"id":"2911278e-1591-42c0-b5f1-876ca816189a","block_type":"box","text":"Ratings nonetheless do not reflect market risk to the extent that they influence the size or other conditionality of","page_number":177,"box":{"x":102,"y":801,"width":801,"height":11}},{"id":"c56e93e9-82cc-4765-8ed0-fb4927d4c798","block_type":"box","text":"the obligation to pay upon a commitment (for example, in the case of index-linked bonds).","page_number":177,"box":{"x":68,"y":816,"width":639,"height":11}},{"id":"9716ea91-0380-4c20-8dac-1bcb1d6edc6c","block_type":"box","text":"In the default components of ratings assigned to individual obligations or instruments, the agency typically rates","page_number":177,"box":{"x":102,"y":838,"width":799,"height":12}},{"id":"8dc8981a-f37c-4b1d-9164-03d0dbd11cb8","block_type":"box","text":"to the likelihood of non-payment or default in accordance with the terms of that instrument’s documentation. In","page_number":177,"box":{"x":68,"y":853,"width":794,"height":12}},{"id":"cb38814c-e0f3-480b-a7b8-b62cfc39b5d2","block_type":"box","text":"limited cases, Fitch may include additional considerations (","page_number":177,"box":{"x":70,"y":869,"width":420,"height":11}},{"id":"03e215c9-22e0-4e91-8a0d-ee921de072c5","block_type":"box","text":"i.e.","page_number":177,"box":{"x":492,"y":869,"width":20,"height":9}},{"id":"b9511d4a-03c9-42ec-8b82-6ddb44ce502d","block_type":"box","text":"rate to a higher or lower standard than that implied in","page_number":177,"box":{"x":519,"y":869,"width":380,"height":11}},{"id":"938315b8-bead-492e-88ba-1a3fc9a58025","block_type":"box","text":"the obligation’s documentation).","page_number":177,"box":{"x":68,"y":884,"width":230,"height":11}},{"id":"d2fc34b4-b1ea-4940-82de-f6c1f528be69","block_type":"box","text":"A-6","page_number":177,"box":{"x":477,"y":943,"width":23,"height":9}},{"id":"425f6e7a-cd37-4161-93b9-733829db92d2","block_type":"box","text":"NM0926U-5977317-177/232","page_number":177,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"d9827153-74e3-4b34-accc-97533ff3121f","block_type":"box","text":"The primary credit rating scales can be used to provide a rating of privately issued obligations or certain note","page_number":178,"box":{"x":101,"y":45,"width":779,"height":11}},{"id":"6d738a38-446a-40eb-a960-81c71aa3a627","block_type":"box","text":"issuance programs or for private ratings. In this case the rating is not published, but only provided to the issuer or its","page_number":178,"box":{"x":70,"y":60,"width":835,"height":11}},{"id":"2ef4d5d5-1ae6-4ded-b400-ea7ace86b1c3","block_type":"box","text":"agents in the form of a rating letter.","page_number":178,"box":{"x":69,"y":75,"width":253,"height":11}},{"id":"f64fd50c-eced-4940-a1ec-7cdca0180554","block_type":"box","text":"The primary credit rating scales may also be used to provide ratings for a more narrow scope, including interest","page_number":178,"box":{"x":101,"y":98,"width":797,"height":11}},{"id":"eb976f60-90c3-4b2a-bc69-522c7145f93e","block_type":"box","text":"strips and return of principal or in other forms of opinions such as credit opinions or rating assessment services.","page_number":178,"box":{"x":69,"y":113,"width":806,"height":11}},{"id":"601cb88b-3bb6-4a2e-9e93-ae29e53c0f1e","block_type":"box","text":"Credit opinions are either a notch- or category-specific view using the primary rating scale and omit one or more","page_number":178,"box":{"x":69,"y":128,"width":796,"height":11}},{"id":"4fe0d696-b7a8-40db-a4e6-30dd3b4097fe","block_type":"box","text":"characteristics of a full rating or meet them to a different standard. Credit opinions will be indicated using a lower","page_number":178,"box":{"x":69,"y":143,"width":811,"height":11}},{"id":"0640a328-f692-48a8-9266-2e116338caa9","block_type":"box","text":"case letter symbol combined with either an ‘*’ (","page_number":178,"box":{"x":69,"y":158,"width":340,"height":11}},{"id":"8f4c27c5-48dd-4ba7-ad05-30867609445f","block_type":"box","text":"e.g.","page_number":178,"box":{"x":410,"y":160,"width":25,"height":9}},{"id":"e18c42b1-11af-4d6d-b30a-9d6722e19da1","block_type":"box","text":"‘bbb+*’) or (cat) suffix to denote the opinion status. Credit","page_number":178,"box":{"x":443,"y":158,"width":418,"height":11}},{"id":"456764b0-611f-4a0c-8365-6ce4e86c1255","block_type":"box","text":"opinions will be point-in-time typically but may be monitored if the analytical group believes information will be","page_number":178,"box":{"x":69,"y":173,"width":780,"height":11}},{"id":"5eaece95-9cb5-4032-81b6-91ddada8fb1e","block_type":"box","text":"sufficiently available. Rating assessment services are a notch-specific view using the primary rating scale of how an","page_number":178,"box":{"x":69,"y":188,"width":827,"height":12}},{"id":"e519b69a-e078-441f-8bcd-5525a8d4f27c","block_type":"box","text":"existing or potential rating may be changed by a given set of hypothetical circumstances. While credit opinions and","page_number":178,"box":{"x":69,"y":203,"width":816,"height":12}},{"id":"a18d51c2-801c-4a1b-b0f6-cabcfb5220ad","block_type":"box","text":"rating assessment services are point-in-time and are not monitored, they may have a directional watch or outlook","page_number":178,"box":{"x":69,"y":219,"width":808,"height":11}},{"id":"a4999165-cfca-4a7f-a0e7-bfd8b140ffc9","block_type":"box","text":"assigned, which can signify the trajectory of the credit profile.","page_number":178,"box":{"x":69,"y":234,"width":437,"height":11}},{"id":"f3c183d3-26ab-4e86-850f-36b6c52fe2ab","block_type":"box","text":"Description of Fitch’s Long-Term Corporate Finance Obligations Rating Scales","page_number":178,"box":{"x":69,"y":264,"width":567,"height":11}},{"id":"845d2e4b-2f51-4b12-89bb-7ebc75350945","block_type":"box","text":"Ratings of individual securities or financial obligations of a corporate issuer address relative vulnerability to","page_number":178,"box":{"x":102,"y":286,"width":763,"height":12}},{"id":"998d0b98-67cf-450b-8f49-c8942e95599d","block_type":"box","text":"default on an ordinal scale. In addition, for financial obligations in corporate finance, a measure of recovery given","page_number":178,"box":{"x":69,"y":302,"width":807,"height":11}},{"id":"37e97971-3413-4239-be96-d509ca373f46","block_type":"box","text":"default on that liability is also included in the rating assessment. This notably applies to covered bonds ratings, which","page_number":178,"box":{"x":69,"y":317,"width":840,"height":11}},{"id":"89d0ea0f-2f80-416e-876d-35d33e97d8ae","block_type":"box","text":"incorporate both an indication of the probability of default and of the recovery given a default of this debt instrument.","page_number":178,"box":{"x":70,"y":332,"width":833,"height":11}},{"id":"3ec97b1c-3780-4e5d-af31-0a19b22c3f95","block_type":"box","text":"On the contrary, Ratings of debtor-in-possession (“DIP”) obligations incorporate the expectation of full repayment.","page_number":178,"box":{"x":69,"y":347,"width":807,"height":11}},{"id":"363cb101-4638-4103-8e73-db0ea7b8b62c","block_type":"box","text":"The relationship between the issuer scale and obligation scale assumes a generic historical average recovery.","page_number":178,"box":{"x":101,"y":370,"width":784,"height":11}},{"id":"ad844fc3-3808-4d59-94f7-3ed39316b435","block_type":"box","text":"Individual obligations can be assigned ratings higher, lower, or the same as that entity’s issuer rating or issuer","page_number":178,"box":{"x":70,"y":385,"width":787,"height":11}},{"id":"e0669ef0-e910-434a-bfdc-3a325aa9e639","block_type":"box","text":"default rating (“IDR”), based on their relative ranking, relative vulnerability to default or based on explicit Recovery","page_number":178,"box":{"x":69,"y":400,"width":813,"height":11}},{"id":"a66e60cc-951f-47c6-8d3d-f371271a26d6","block_type":"box","text":"Ratings.","page_number":178,"box":{"x":70,"y":415,"width":55,"height":11}},{"id":"08c08c5f-04fa-448e-83a5-85bc6592fc19","block_type":"box","text":"As a result, individual obligations of entities, such as corporations, are assigned ratings higher, lower, or the","page_number":178,"box":{"x":101,"y":438,"width":772,"height":11}},{"id":"194298ac-aca6-4f48-a868-2c8be33bee56","block_type":"box","text":"same as that entity’s issuer rating or IDR, except DIP obligation ratings that are not based off an IDR. At the lower","page_number":178,"box":{"x":69,"y":453,"width":815,"height":11}},{"id":"b332e52d-dd0b-44f9-8f39-f80ce12ebcaa","block_type":"box","text":"end of the ratings scale, Fitch publishes explicit Recovery Ratings in many cases to complement issuer and","page_number":178,"box":{"x":69,"y":468,"width":766,"height":11}},{"id":"428cb4cf-135d-417d-a412-45b7eaec4996","block_type":"box","text":"obligation ratings.","page_number":178,"box":{"x":69,"y":483,"width":125,"height":11}},{"id":"f3639707-f191-442b-aed5-221b8ceabef4","block_type":"box","text":"Fitch long-term obligations rating scales are as follows:","page_number":178,"box":{"x":102,"y":506,"width":390,"height":11}},{"id":"ceafd9ee-2142-4c03-afdf-712cd325842e","block_type":"box","text":"AAA Highest Credit Quality. ‘AAA’ ratings denote the lowest expectation of default risk. They are","page_number":178,"box":{"x":68,"y":533,"width":774,"height":12}},{"id":"d53ba2e2-4363-496d-867e-51ab2b811ea6","block_type":"box","text":"assigned only in cases of exceptionally strong capacity for payment of financial commitments. This","page_number":178,"box":{"x":196,"y":549,"width":703,"height":11}},{"id":"a75fc357-da7e-47e2-8276-fab525da3df0","block_type":"box","text":"capacity is highly unlikely to be adversely affected by foreseeable events.","page_number":178,"box":{"x":196,"y":564,"width":521,"height":11}},{"id":"b51ebfcd-7d5c-4343-9604-6ef651a933ef","block_type":"box","text":"AA Very High Credit Quality. ‘AA’ ratings denote expectations of very low default risk. They indicate very","page_number":178,"box":{"x":68,"y":584,"width":838,"height":11}},{"id":"200aa55f-16a1-4377-b87c-2c9768266bda","block_type":"box","text":"strong capacity for payment of financial commitments. This capacity is not significantly vulnerable","page_number":178,"box":{"x":196,"y":599,"width":694,"height":11}},{"id":"4ae34682-33bc-4f44-921a-d97e03545374","block_type":"box","text":"to foreseeable events.","page_number":178,"box":{"x":195,"y":614,"width":159,"height":9}},{"id":"f78871a5-3fbe-489f-a7e6-4b338c4dcc1b","block_type":"box","text":"A High Credit Quality. ‘A’ ratings denote expectations of low default risk. The capacity for payment of","page_number":178,"box":{"x":68,"y":634,"width":828,"height":12}},{"id":"b215fc0d-10fc-41f0-94e4-62c6d596d914","block_type":"box","text":"financial commitments is considered strong. This capacity may, nevertheless, be more vulnerable","page_number":178,"box":{"x":196,"y":649,"width":695,"height":12}},{"id":"facd5e50-0b07-41d8-b060-9a9d1c2f7116","block_type":"box","text":"to adverse business or economic conditions than is the case for higher ratings.","page_number":178,"box":{"x":195,"y":664,"width":565,"height":12}},{"id":"6a680566-9b0b-4094-bee7-e424aed06d0f","block_type":"box","text":"BBB Good Credit Quality. ‘BBB’ ratings indicate that expectations of default risk are currently low. The","page_number":178,"box":{"x":70,"y":685,"width":814,"height":11}},{"id":"31b9876a-44e4-455a-8e47-ba67666b3b2f","block_type":"box","text":"capacity for payment of financial commitments is considered adequate, but adverse business or","page_number":178,"box":{"x":196,"y":700,"width":686,"height":11}},{"id":"617fe7d7-cd59-4cc4-b802-e4c4c45dfce2","block_type":"box","text":"economic conditions are more likely to impair this capacity.","page_number":178,"box":{"x":196,"y":715,"width":420,"height":11}},{"id":"ba50cc2e-068e-4011-b9d2-33e3ee5a8fed","block_type":"box","text":"BB Speculative. ‘BB’ ratings indicate an elevated vulnerability to default risk, particularly in the event of","page_number":178,"box":{"x":70,"y":735,"width":839,"height":11}},{"id":"9653d344-dbb4-479a-83d1-427fdfa6a755","block_type":"box","text":"adverse changes in business or economic conditions over time; however, business or financial","page_number":178,"box":{"x":196,"y":750,"width":672,"height":11}},{"id":"f36bad2e-13d1-48fc-a1e3-7bd0059096ad","block_type":"box","text":"flexibility exists that supports the servicing of financial commitments.","page_number":178,"box":{"x":196,"y":765,"width":495,"height":12}},{"id":"deed8d63-2af2-47bc-bfc9-d217f1ef0d09","block_type":"box","text":"B Highly Speculative. ‘B’ ratings indicate that material default risk is present, but a limited margin of","page_number":178,"box":{"x":70,"y":785,"width":828,"height":12}},{"id":"d33226a9-8665-4d33-8729-1a94b9f53e43","block_type":"box","text":"safety remains. Financial commitments are currently being met; however, capacity for continued","page_number":178,"box":{"x":196,"y":801,"width":682,"height":11}},{"id":"c60d4ff4-1034-4619-8919-b06f244c0d0b","block_type":"box","text":"payment is vulnerable to deterioration in the business and economic environment.","page_number":178,"box":{"x":197,"y":816,"width":584,"height":11}},{"id":"a1efb745-a8ee-4cba-a11b-7a2bbbd19c02","block_type":"box","text":"CCC Substantial Credit Risk. ‘CCC’ ratings indicate very low margin for safety. Default is a real","page_number":178,"box":{"x":69,"y":836,"width":764,"height":11}},{"id":"8e805acc-4a35-4c86-a2c5-8de30c411810","block_type":"box","text":"possibility.","page_number":178,"box":{"x":197,"y":851,"width":72,"height":11}},{"id":"9b671500-62d3-4db4-9282-574af95da1d4","block_type":"box","text":"CC Very High Levels of Credit Risk. ‘CC’ ratings indicate default of some kind appears probable.","page_number":178,"box":{"x":69,"y":871,"width":784,"height":11}},{"id":"68dd9aac-a8c9-4edc-82b3-f1958a53f551","block_type":"box","text":"C Exceptionally High Levels of Credit Risk. ‘C’ ratings indicate default or default-like process has","page_number":178,"box":{"x":69,"y":891,"width":798,"height":12}},{"id":"a57c2674-9111-4036-b5e8-1c8d1ac23051","block_type":"box","text":"begun, or for a closed funding vehicle, payment capacity is irrevocably impaired.","page_number":178,"box":{"x":196,"y":906,"width":569,"height":12}},{"id":"69f87b35-b887-4623-891c-5a859b55e477","block_type":"box","text":"A-7","page_number":178,"box":{"x":477,"y":943,"width":23,"height":9}},{"id":"9df45c2a-6e1c-49a0-a155-ab9c19850cb6","block_type":"box","text":"NM0926U-5977317-178/232","page_number":178,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"bf1e87cb-e975-4651-8a00-a8f62d5f6506","block_type":"box","text":"RD Restricted Default. ‘RD’ ratings indicate an issuer that in Fitch’s opinion has experienced an","page_number":179,"box":{"x":70,"y":48,"width":782,"height":12}},{"id":"ee335ce5-365a-46f8-bf49-060666ea0a17","block_type":"box","text":"uncured payment default or distressed debt exchange on a bond, loan or other material financial","page_number":179,"box":{"x":197,"y":63,"width":686,"height":12}},{"id":"5822c161-9a49-460c-b21d-cab9120771e1","block_type":"box","text":"obligation, but has not entered into bankruptcy filings, administration, receivership, liquidation, or","page_number":179,"box":{"x":196,"y":79,"width":696,"height":11}},{"id":"8f162a44-8ae1-412f-a516-6cbd54e95d78","block_type":"box","text":"other formal winding-up procedure, and has not otherwise ceased operating.","page_number":179,"box":{"x":196,"y":94,"width":544,"height":11}},{"id":"915210c6-9d67-4c25-bf7e-42f9ac7e9262","block_type":"box","text":"D Default. ‘D’ ratings indicate an issuer that in Fitch’s opinion has entered into bankruptcy filings,","page_number":179,"box":{"x":70,"y":114,"width":807,"height":11}},{"id":"e4fedd7e-15ad-41fa-a7d1-182322b8dc94","block_type":"box","text":"administration, receivership, liquidation or other formal winding-up procedure or that has otherwise","page_number":179,"box":{"x":196,"y":129,"width":705,"height":11}},{"id":"72489d0a-6814-45b9-9b81-b17f5d642a57","block_type":"box","text":"ceased business and debt is still outstanding.","page_number":179,"box":{"x":196,"y":144,"width":328,"height":11}},{"id":"443f4260-101f-47eb-88d1-e603b3110252","block_type":"box","text":"Within rating categories, Fitch may use modifiers. The modifiers “+” or “-” may be appended to a rating to denote","page_number":179,"box":{"x":101,"y":164,"width":808,"height":12}},{"id":"7a2412b4-a56d-4df1-934b-6fcb4fde863a","block_type":"box","text":"relative status within major rating categories.","page_number":179,"box":{"x":69,"y":180,"width":320,"height":11}},{"id":"d5064f25-3bde-4487-89b6-d2f5dc10ed13","block_type":"box","text":"For example, the rating category ‘AA’ has three notch-specific rating levels (‘AA+’; ‘AA’; ‘AA–’; each a rating","page_number":179,"box":{"x":102,"y":202,"width":761,"height":11}},{"id":"9529fd1f-30fb-4c8c-b926-5be49eeae9c8","block_type":"box","text":"level). Such suffixes are not added to ‘AAA’ ratings and ratings below the ‘CCC’ category. For the short-term rating","page_number":179,"box":{"x":70,"y":217,"width":813,"height":12}},{"id":"81d917de-d76b-4629-a961-af83210d08a3","block_type":"box","text":"category of ‘F1’, a ‘+’ may be appended.","page_number":179,"box":{"x":69,"y":232,"width":289,"height":12}},{"id":"9d4d1e29-a1f6-4c41-aadf-0e32db89be36","block_type":"box","text":"Description of Fitch’s Short-Term Ratings Assigned to Issuers and Obligations","page_number":179,"box":{"x":69,"y":263,"width":568,"height":11}},{"id":"410cc7db-144e-471a-99a3-98625e82b01e","block_type":"box","text":"A short-term issuer or obligation rating is based in all cases on the short-term vulnerability to default of the rated","page_number":179,"box":{"x":101,"y":285,"width":806,"height":12}},{"id":"cf438b16-a524-46e3-8754-38f14a05edf4","block_type":"box","text":"entity and relates to the capacity to meet financial obligations in accordance with the documentation governing the","page_number":179,"box":{"x":69,"y":300,"width":817,"height":12}},{"id":"29865f88-ffcf-4c41-a641-47059b67f731","block_type":"box","text":"relevant obligation. Short-term deposit ratings may be adjusted for loss severity. Short-term ratings are assigned to","page_number":179,"box":{"x":69,"y":315,"width":822,"height":12}},{"id":"03501269-aaae-474f-94fa-c9d26ed1adc6","block_type":"box","text":"obligations whose initial maturity is viewed as “short term” based on market convention. Typically, this means up to","page_number":179,"box":{"x":69,"y":331,"width":827,"height":11}},{"id":"fe5c273b-7267-4ea6-b223-9caebf99f96a","block_type":"box","text":"13 months for corporate, sovereign, and structured obligations and up to 36 months for obligations in U.S. public","page_number":179,"box":{"x":70,"y":346,"width":808,"height":11}},{"id":"a88bc8f3-4f20-46b8-a991-030cea39733d","block_type":"box","text":"finance markets.","page_number":179,"box":{"x":68,"y":361,"width":118,"height":9}},{"id":"e8769bc5-9c46-47a7-9a9d-8cbe1dca629b","block_type":"box","text":"Fitch short-term ratings are as follows:","page_number":179,"box":{"x":102,"y":383,"width":273,"height":12}},{"id":"d588e512-aea3-4290-a0c7-f7f2e93b2968","block_type":"box","text":"F1 Highest Short-Term Credit Quality. Indicates the strongest intrinsic capacity for timely payment of","page_number":179,"box":{"x":70,"y":411,"width":816,"height":12}},{"id":"038064a2-0991-4b57-9f09-40a6c2d4842b","block_type":"box","text":"financial commitments; may have an added “+” to denote any exceptionally strong credit feature.","page_number":179,"box":{"x":196,"y":426,"width":692,"height":12}},{"id":"404be748-f7b1-4253-9944-83e68d9b669f","block_type":"box","text":"F2 Good Short-Term Credit Quality. Good intrinsic capacity for timely payment of financial","page_number":179,"box":{"x":70,"y":446,"width":734,"height":12}},{"id":"e18662c9-5f29-42c3-92b1-54a02321ea00","block_type":"box","text":"commitments.","page_number":179,"box":{"x":196,"y":462,"width":100,"height":9}},{"id":"cf1cf69e-2509-4d2f-bcf1-c1695aa62535","block_type":"box","text":"F3 Fair Short-Term Credit Quality. The intrinsic capacity for timely payment of financial commitments is","page_number":179,"box":{"x":70,"y":482,"width":831,"height":11}},{"id":"ee96913e-b5ab-4213-a567-8afefc01e80d","block_type":"box","text":"adequate.","page_number":179,"box":{"x":196,"y":497,"width":70,"height":11}},{"id":"cd91833b-df58-4ef5-8aca-b40c010c6889","block_type":"box","text":"B Speculative Short-Term Credit Quality. Minimal capacity for timely payment of financial","page_number":179,"box":{"x":70,"y":517,"width":737,"height":11}},{"id":"f123a974-b324-4cab-8883-77abff8d7f2e","block_type":"box","text":"commitments, plus heightened vulnerability to near term adverse changes in financial and","page_number":179,"box":{"x":196,"y":532,"width":641,"height":11}},{"id":"74c9cd35-c3fc-4ce8-a3f7-2ead54268cd2","block_type":"box","text":"economic conditions.","page_number":179,"box":{"x":196,"y":548,"width":149,"height":8}},{"id":"62176367-bcf4-4535-9659-42a51c7e0ea8","block_type":"box","text":"C High Short-Term Default Risk. Default is a real possibility.","page_number":179,"box":{"x":69,"y":567,"width":535,"height":12}},{"id":"3419de0d-ec21-401a-ae92-92b77c5bd27a","block_type":"box","text":"RD Restricted Default. Indicates an entity that has defaulted on one or more of its financial","page_number":179,"box":{"x":70,"y":588,"width":749,"height":11}},{"id":"733a2c25-6c59-485a-ace6-6d711fcaca05","block_type":"box","text":"commitments, although it continues to meet other financial obligations. Typically applicable to entity","page_number":179,"box":{"x":196,"y":603,"width":714,"height":11}},{"id":"08f98ad3-25eb-4cf7-acb2-e2ce23b0a5f0","block_type":"box","text":"ratings only.","page_number":179,"box":{"x":197,"y":618,"width":83,"height":11}},{"id":"debe5f35-f8fa-4951-a071-35b05446b524","block_type":"box","text":"D Default. Indicates a broad-based default event for an entity, or the default of a short-term","page_number":179,"box":{"x":70,"y":638,"width":761,"height":11}},{"id":"f179efb3-64cb-4418-a554-d890978d2480","block_type":"box","text":"obligation.","page_number":179,"box":{"x":196,"y":653,"width":72,"height":11}},{"id":"ef21bcb3-9be6-4cea-98e8-c117a486f892","block_type":"box","text":"A-8","page_number":179,"box":{"x":477,"y":943,"width":24,"height":9}},{"id":"eee7e8db-5e2f-4edb-b0fa-531c081d6ecf","block_type":"box","text":"NM0926U-5977317-179/232","page_number":179,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"766121f0-6fd8-482b-b2b0-6e6b03099ea6","block_type":"box","text":"APPENDIX B","page_number":180,"box":{"x":438,"y":76,"width":101,"height":9}},{"id":"cfd7fb0a-1491-4f54-bd7e-5fd14243e6bb","block_type":"box","text":"Open-End Active and Fixed Income Index Fund Proxy Voting 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The guidance informs the voting recommendations BAIS","page_number":184,"box":{"x":69,"y":143,"width":803,"height":11}},{"id":"8763c1c6-ecb7-46a8-b722-a412d21b683a","block_type":"box","text":"makes to BlackRock’s active portfolio managers. It applies to active equity holdings in BlackRock’s fundamental","page_number":184,"box":{"x":69,"y":158,"width":800,"height":11}},{"id":"8f2b2fc0-aa00-41bd-ae9a-0c1754dd8824","block_type":"box","text":"equity, systematic equity and multi-asset solutions strategies. 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There are","page_number":184,"box":{"x":68,"y":218,"width":788,"height":12}},{"id":"c4ee5ff9-44f3-49a2-8e2f-7167548ef6d9","block_type":"box","text":"separate, independently developed principles and voting policies that are applied to BlackRock’s index equity","page_number":184,"box":{"x":69,"y":234,"width":778,"height":11}},{"id":"acf9da07-ac5a-4261-ae0b-99281e6821cb","block_type":"box","text":"investments by a distinct and independent function, BlackRock Investment Stewardship.","page_number":184,"box":{"x":70,"y":249,"width":627,"height":11}},{"id":"1d237d87-a48b-40e4-a575-ce827ea05ac4","block_type":"box","text":"1","page_number":184,"box":{"x":69,"y":294,"width":4,"height":4}},{"id":"6681a050-f010-463e-8a23-4a16fff03693","block_type":"box","text":"This document includes BAIS’ benchmark policy, which covers nearly all active equity holdings in BlackRock’s","page_number":184,"box":{"x":78,"y":293,"width":777,"height":11}},{"id":"5fdff3e3-6490-440d-95d4-09bb5cfa9f52","block_type":"box","text":"fundamental equity, systematic equity and multi-asset solutions strategies. The benchmark policy also may apply to","page_number":184,"box":{"x":68,"y":308,"width":823,"height":11}},{"id":"7f8d2834-201a-446d-87f6-f5e91ebdb165","block_type":"box","text":"holdings in BlackRock’s index and active fixed income strategies, to the extent those strategies hold voting securities","page_number":184,"box":{"x":69,"y":323,"width":837,"height":12}},{"id":"416f2637-0c24-4fdc-90e2-cbc8c19d1b5e","block_type":"box","text":"or conduct issuer engagements. This document also includes BAIS’ decarbonization policy, which covers holdings in","page_number":184,"box":{"x":69,"y":339,"width":824,"height":11}},{"id":"e5d83493-431e-40a6-be2f-071b40bb048e","block_type":"box","text":"BlackRock active funds that have climate and decarbonization objectives in addition to financial objectives.","page_number":184,"box":{"x":70,"y":354,"width":759,"height":11}},{"id":"9d290731-80c2-4017-b7a3-7f442aaec0f1","block_type":"box","text":"2","page_number":184,"box":{"x":69,"y":372,"width":4,"height":4}},{"id":"0f27d2b9-6d9a-466e-82f3-ffc9143d09dc","block_type":"box","text":"BlackRock segmented active and index equity investment functions, including stewardship, in January 2025 as part","page_number":184,"box":{"x":79,"y":371,"width":825,"height":11}},{"id":"14053a8c-5cde-4416-8411-bfdc4adc314c","block_type":"box","text":"of a strategic initiative to unlock the full breadth of the firm’s active and private markets capabilities for clients. As a","page_number":184,"box":{"x":69,"y":386,"width":830,"height":12}},{"id":"70bac526-5f82-4449-b9dd-d7a6edb60d60","block_type":"box","text":"result, there are two stewardship teams, which operate independently of one another and have separate voting","page_number":184,"box":{"x":69,"y":401,"width":792,"height":12}},{"id":"908bdaf7-a4b1-4d93-a425-69bdc82fb6b1","block_type":"box","text":"policies.","page_number":184,"box":{"x":70,"y":417,"width":56,"height":11}},{"id":"b1cc23d2-0c2f-475e-a573-b81a57f0a438","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":184,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"d0d72b88-fcaf-4012-b6b8-72247ea83eed","block_type":"box","text":"Global Engagement and Voting Guidelines | 3","page_number":184,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"9dffea8c-8bde-4844-ad95-db012ff9ec86","block_type":"box","text":"NM0926U-5977317-184/232","page_number":184,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"c4b53a0c-e346-4fb9-ac9f-8b1d029b9549","block_type":"box","text":"INTRODUCTION TO BLACKROCK","page_number":185,"box":{"x":372,"y":45,"width":235,"height":9}},{"id":"f767fe4c-2a70-48a3-bc40-b0ae2cad6af5","block_type":"box","text":"BlackRock’s mission is to help more people invest better. The money BlackRock manages is not its own — it","page_number":185,"box":{"x":102,"y":64,"width":777,"height":11}},{"id":"a4e8192f-9535-4505-adef-59eb6eb515f0","block_type":"box","text":"belongs to BlackRock’s clients, many of whom make their own asset allocation and portfolio construction decisions.","page_number":185,"box":{"x":69,"y":78,"width":828,"height":12}},{"id":"26396283-e8aa-4c26-80cf-1c5ddf0e86cc","block_type":"box","text":"As a fiduciary, BlackRock invests on clients’ behalf to help them meet their investment objectives. The firm does this","page_number":185,"box":{"x":68,"y":93,"width":835,"height":11}},{"id":"714d9517-d0df-48cf-9f92-ba1c2fc7fdec","block_type":"box","text":"by understanding clients’ long-term investment objectives and offering choice on how and where they wish to invest","page_number":185,"box":{"x":69,"y":108,"width":823,"height":11}},{"id":"b2516d23-b91f-45e4-a775-d32fd77df91c","block_type":"box","text":"their money. BlackRock then helps clients seek the best risk-adjusted returns based on those choices, underpinning","page_number":185,"box":{"x":68,"y":123,"width":830,"height":11}},{"id":"7d7cce03-4dd3-4ff1-b2bc-b3fd0626257b","block_type":"box","text":"this work with research, data and analytics.","page_number":185,"box":{"x":68,"y":138,"width":309,"height":11}},{"id":"f1be1219-68cc-4e56-b45a-2e761cb20635","block_type":"box","text":"At BlackRock, investment stewardship is core to our role as an asset manager and a fiduciary to our clients. As","page_number":185,"box":{"x":101,"y":156,"width":796,"height":12}},{"id":"20946525-b7f4-4a76-88f2-b5e5c676d799","block_type":"box","text":"stewards of our clients’ assets, we engage with companies to discuss the corporate governance and business","page_number":185,"box":{"x":69,"y":171,"width":787,"height":12}},{"id":"4ce7d90b-d5cf-4128-8b2b-203da78887d1","block_type":"box","text":"practices that, in our experience, support companies in delivering durable, risk-adjusted financial returns over time.","page_number":185,"box":{"x":70,"y":186,"width":820,"height":12}},{"id":"83c3975e-d9c1-4763-891f-2440ecbe78e1","block_type":"box","text":"We are committed to building strong relationships through constructive, ongoing dialogue with the boards and","page_number":185,"box":{"x":68,"y":201,"width":782,"height":11}},{"id":"2d1c2edf-e45b-41db-8dc9-c4230fe4d674","block_type":"box","text":"executive management of the companies in which our clients are invested.","page_number":185,"box":{"x":69,"y":216,"width":531,"height":11}},{"id":"32e55fd8-39de-49b9-870b-1a6d9d34626a","block_type":"box","text":"ABOUT BLACKROCK ACTIVE INVESTMENT STEWARDSHIP","page_number":185,"box":{"x":277,"y":246,"width":424,"height":9}},{"id":"db3f1146-9ec6-4ef2-b019-30628ea3c69f","block_type":"box","text":"BlackRock Active Investment Stewardship (BAIS) is a specialist team within the Portfolio Management Group and","page_number":185,"box":{"x":102,"y":265,"width":804,"height":11}},{"id":"83de046b-151e-4427-9082-3729ba621391","block_type":"box","text":"manages BlackRock’s stewardship engagement and voting on behalf of clients invested in active strategies globally.","page_number":185,"box":{"x":69,"y":280,"width":826,"height":11}},{"id":"c4990a60-cc46-4323-86d8-ceaf83f34b8b","block_type":"box","text":"BAIS is also responsible for engagement with issuers in index fixed income strategies, where appropriate. Our","page_number":185,"box":{"x":70,"y":295,"width":783,"height":11}},{"id":"0213c081-260e-4064-aa35-ca942512d3ad","block_type":"box","text":"activities are informed by these Global Engagement and Voting Guidelines (the “Guidelines”) and insights from active","page_number":185,"box":{"x":69,"y":309,"width":834,"height":12}},{"id":"788d080d-1637-48e4-8d6a-72b61bc72527","block_type":"box","text":"investment analysts and portfolio managers, with whom we work closely in engaging companies and voting at","page_number":185,"box":{"x":70,"y":324,"width":779,"height":12}},{"id":"2a120bc8-641a-45a8-820b-0ffc76a5dce3","block_type":"box","text":"shareholder meetings.","page_number":185,"box":{"x":69,"y":339,"width":158,"height":11}},{"id":"4867f579-075f-4ade-9f76-06e56894a8a5","block_type":"box","text":"Engagement with public companies is the foundation of our approach to stewardship within fundamental active","page_number":185,"box":{"x":102,"y":358,"width":789,"height":11}},{"id":"8a240393-50ed-42d4-bc76-7f66528ef48c","block_type":"box","text":"investing.","page_number":185,"box":{"x":70,"y":373,"width":65,"height":11}},{"id":"5d20e6eb-d33c-46af-b534-123acbe5db56","block_type":"box","text":"3","page_number":185,"box":{"x":137,"y":373,"width":4,"height":5}},{"id":"bb76850a-5fc2-4be5-94b7-6150379af821","block_type":"box","text":"Through direct dialogue with company leadership, we seek to understand their businesses and how they","page_number":185,"box":{"x":146,"y":373,"width":744,"height":11}},{"id":"83391b48-89f8-47ed-9631-1611bb06f913","block_type":"box","text":"manage risks and opportunities to deliver durable, risk-adjusted financial returns. Portfolio managers and","page_number":185,"box":{"x":69,"y":387,"width":751,"height":12}},{"id":"3ad44522-9702-4ffc-90d6-22284bf4f133","block_type":"box","text":"stewardship specialists may engage jointly or independently on material corporate governance matters. Our","page_number":185,"box":{"x":69,"y":402,"width":765,"height":12}},{"id":"fece7d57-b997-426f-aa1a-fb7499ac01a3","block_type":"box","text":"discussions focus on topics relevant to a company’s success over time, including governance and leadership,","page_number":185,"box":{"x":69,"y":417,"width":782,"height":12}},{"id":"98ef35b6-80f5-43dc-9160-12edf8568524","block_type":"box","text":"corporate strategy, capital structure and financial performance, operations and material sustainability-related risks,","page_number":185,"box":{"x":69,"y":432,"width":820,"height":11}},{"id":"36c1e578-3bdf-4c09-b77b-3bb3efec362d","block_type":"box","text":"as well as macro-economic, geopolitical and sector dynamics. We aim to be constructive investors and are generally","page_number":185,"box":{"x":69,"y":447,"width":828,"height":11}},{"id":"f21648c4-def0-4ed3-afbc-5c385bd8e118","block_type":"box","text":"supportive of management teams that have a track record of financial value creation. We aim to build and maintain","page_number":185,"box":{"x":69,"y":462,"width":821,"height":11}},{"id":"e2a7d62f-03d7-4888-8790-2e586b4d9ecd","block_type":"box","text":"strong relationships with company leadership based on open dialogue and mutual respect.","page_number":185,"box":{"x":69,"y":477,"width":645,"height":11}},{"id":"cb0d7844-b0fe-4a0a-a3ce-96c4f40f4aae","block_type":"box","text":"Different active equity strategies may implement these voting guidelines differently, as a result of the latitude","page_number":185,"box":{"x":102,"y":495,"width":780,"height":12}},{"id":"eaa6517f-3ec5-4757-a44b-3fb9c6620fea","block_type":"box","text":"each portfolio manager has to make independent voting decisions on their holdings. For example, BAIS will generally","page_number":185,"box":{"x":69,"y":510,"width":831,"height":11}},{"id":"ecee1371-d098-45f9-be78-57e2c259e01c","block_type":"box","text":"vote the holdings in Systematic Active Equity portfolios in accordance with these guidelines. We provide voting","page_number":185,"box":{"x":68,"y":525,"width":787,"height":11}},{"id":"a82b1c45-9077-49e0-ae90-b7257a22d022","block_type":"box","text":"recommendations to fundamental equity portfolio managers, who may determine to vote differently based on each","page_number":185,"box":{"x":69,"y":540,"width":816,"height":11}},{"id":"98fb5788-efe9-4f63-a63f-046169ff9ad7","block_type":"box","text":"portfolio’s investment objectives and strategy.","page_number":185,"box":{"x":70,"y":555,"width":327,"height":11}},{"id":"23aacf1d-81b8-476d-ac33-ffa0ee223ad1","block_type":"box","text":"These guidelines discuss BAIS’ views on corporate governance topics on which we may engage with","page_number":185,"box":{"x":101,"y":574,"width":711,"height":11}},{"id":"a6a7468b-614c-4ed1-b943-f917bbb4e647","block_type":"box","text":"management teams and board directors","page_number":185,"box":{"x":69,"y":589,"width":285,"height":11}},{"id":"7e72a16c-4fea-4827-8b20-5e01564239d8","block_type":"box","text":"4","page_number":185,"box":{"x":355,"y":589,"width":5,"height":4}},{"id":"fa5cbc49-af21-4417-a549-6ac4c2359234","block_type":"box","text":"and on matters that routinely come to a shareholder vote. We recognize that","page_number":185,"box":{"x":366,"y":589,"width":544,"height":11}},{"id":"487acef6-0cac-4144-ac93-cbda3aceb763","block_type":"box","text":"accepted corporate governance norms can differ across markets, and believe these guidelines represent globally","page_number":185,"box":{"x":69,"y":603,"width":807,"height":11}},{"id":"0604a412-a56e-475f-b422-97c49b968ee1","block_type":"box","text":"applicable elements of governance that support a company’s ability to manage material risks and opportunities and","page_number":185,"box":{"x":69,"y":618,"width":827,"height":11}},{"id":"bb30579a-b87d-4f2f-91b9-04bb22d52d81","block_type":"box","text":"deliver financial returns to investors. Generally, we believe companies should observe accepted corporate governance","page_number":185,"box":{"x":69,"y":633,"width":840,"height":11}},{"id":"2d514488-9002-4863-8d8a-9d8c94a0ad73","block_type":"box","text":"norms within their local markets or, particularly in markets without well-established norms, aspire to widely","page_number":185,"box":{"x":69,"y":648,"width":762,"height":11}},{"id":"ceeabd51-aefa-461c-bc08-3bc07469f4b3","block_type":"box","text":"recognized international best practices. As one of many minority shareholders, BlackRock cannot – and does not try","page_number":185,"box":{"x":69,"y":663,"width":827,"height":11}},{"id":"dadfa2ab-c4c2-410d-b75a-89b6601e5a00","block_type":"box","text":"to – direct a company’s strategy or its implementation. We look to companies to provide disclosures that explain how","page_number":185,"box":{"x":68,"y":678,"width":837,"height":11}},{"id":"6b59bd21-1ab1-40f9-b8a6-c345b3f3d0e8","block_type":"box","text":"their approach to corporate governance best aligns with the financial interests of their investors.","page_number":185,"box":{"x":68,"y":692,"width":687,"height":12}},{"id":"7e192b68-3059-42c4-a4cb-19bdda96948f","block_type":"box","text":"OUR APPROACH TO STEWARDSHIP WITHIN ACTIVE EQUITIES","page_number":185,"box":{"x":263,"y":722,"width":451,"height":11}},{"id":"18ea4808-5b43-4cca-9ac5-add22b9aea11","block_type":"box","text":"Voting at a company’s shareholder meeting is a right of share ownership and a core principle of corporate","page_number":185,"box":{"x":101,"y":741,"width":753,"height":12}},{"id":"dbde9856-0a4f-40ef-9fbe-5f974f226581","block_type":"box","text":"governance. The voting rights attached to clients’ holdings are an important mechanism for investors to express","page_number":185,"box":{"x":68,"y":756,"width":801,"height":11}},{"id":"cebbe47a-df4c-4880-b096-2478127fe500","block_type":"box","text":"support for, or concern about, a company’s performance. As a fiduciary, BlackRock is legally required to make proxy","page_number":185,"box":{"x":69,"y":771,"width":829,"height":11}},{"id":"5b867f0f-5cc3-4ea8-a261-af143a48ee47","block_type":"box","text":"voting determinations, on behalf of clients who have delegated voting authority to us, in a manner consistent with","page_number":185,"box":{"x":68,"y":786,"width":809,"height":11}},{"id":"3e2a21fc-bab8-4067-b773-c9c0e1351cd7","block_type":"box","text":"BlackRock’s contractual arrangements with clients and funds.","page_number":185,"box":{"x":70,"y":801,"width":438,"height":11}},{"id":"b3f6741d-955e-49d6-9573-272f26a2ac0c","block_type":"box","text":"3","page_number":185,"box":{"x":69,"y":830,"width":4,"height":5}},{"id":"53581e0a-8a8f-4550-aafc-13fbc4b09af1","block_type":"box","text":"On February 11, 2025, the U.S. Securities and Exchange Commission (SEC) staff issued updated guidance for","page_number":185,"box":{"x":79,"y":830,"width":790,"height":11}},{"id":"156ff97c-74cd-4952-bb7e-59e9cb4ccdf0","block_type":"box","text":"shareholders to maintain their eligibility to report their beneficial ownership under Schedule 13G of the Exchange Act.","page_number":185,"box":{"x":69,"y":845,"width":836,"height":11}},{"id":"c6984f09-2445-4ebe-ab53-616b0ff33de1","block_type":"box","text":"We comply fully with these requirements and do not engage with portfolio companies for the purpose, or with the","page_number":185,"box":{"x":68,"y":860,"width":805,"height":11}},{"id":"a45d9037-3183-43dd-aa71-9835a57eb06f","block_type":"box","text":"effect, of changing or influencing control of the company.","page_number":185,"box":{"x":69,"y":875,"width":403,"height":12}},{"id":"69f77615-913d-4c3e-96e5-ece0399fd8af","block_type":"box","text":"4","page_number":185,"box":{"x":69,"y":893,"width":4,"height":5}},{"id":"56c58be1-94b5-46ae-ab00-cb939878f2c7","block_type":"box","text":"References to the board, board directors or non-executive directors should be understood to include supervisory","page_number":185,"box":{"x":79,"y":893,"width":801,"height":11}},{"id":"93a50216-ec77-40a2-b5d8-5544e7980e9e","block_type":"box","text":"boards and their members, where relevant.","page_number":185,"box":{"x":69,"y":908,"width":306,"height":11}},{"id":"975bb686-df22-48e5-bb12-8bc8fd42a0a5","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":185,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"73dfc223-cd1b-4959-879f-6b0667fb987b","block_type":"box","text":"Global Engagement and Voting Guidelines | 4","page_number":185,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"5067ad7e-4812-44c3-ae5b-55b2fa5b56b1","block_type":"box","text":"NM0926U-5977317-185/232","page_number":185,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"4fc48e75-eefc-47eb-a796-29b98751ce75","block_type":"box","text":"In general, we tend to support the recommendations of the board of directors and management. As indicated","page_number":186,"box":{"x":102,"y":45,"width":778,"height":11}},{"id":"796ffaca-0cfa-4952-9636-8c80cbbb502c","block_type":"box","text":"below, we may vote against management recommendations when we have concerns about how companies are","page_number":186,"box":{"x":69,"y":60,"width":788,"height":11}},{"id":"4da86534-e602-4f5b-b6ea-4b5d910e4052","block_type":"box","text":"serving the financial interests of our clients as their shareholders. BAIS takes a globally consistent approach to","page_number":186,"box":{"x":69,"y":74,"width":795,"height":12}},{"id":"b51368cf-b4ee-45e8-8eff-c7dfe52873b4","block_type":"box","text":"voting but considers the different corporate governance regulations and norms across markets. Votes are determined","page_number":186,"box":{"x":68,"y":89,"width":839,"height":12}},{"id":"61768cc5-659c-41fd-a0e2-f498108d8fcb","block_type":"box","text":"on a case-by-case basis, in the context of a company’s situation and the investment mandate we have from clients.","page_number":186,"box":{"x":69,"y":104,"width":823,"height":11}},{"id":"d324b24b-ec6b-4e74-a379-8574759d90cf","block_type":"box","text":"Please see page 19 for more information about how we fulfill and oversee our investment stewardship","page_number":186,"box":{"x":69,"y":119,"width":729,"height":11}},{"id":"458b564d-c348-49a8-ad9b-742300e52cf4","block_type":"box","text":"responsibilities for BlackRock’s non-index equity strategies.","page_number":186,"box":{"x":69,"y":134,"width":423,"height":11}},{"id":"f3e84e60-8ea0-46d4-befa-103587d28e7b","block_type":"box","text":"5","page_number":186,"box":{"x":493,"y":134,"width":5,"height":5}},{"id":"f22bc147-5c49-41f6-beaf-6bab249558fd","block_type":"box","text":"OUR APPROACH TO STEWARDSHIP WITHIN FIXED INCOME","page_number":186,"box":{"x":272,"y":164,"width":434,"height":9}},{"id":"6c886f9b-7704-4299-b0ea-c386a70436cc","block_type":"box","text":"Although fixed income investors do not have the right to vote at shareholder meetings, issuer engagement is a","page_number":186,"box":{"x":101,"y":183,"width":788,"height":11}},{"id":"4541cec2-1b30-499d-8fbe-dee6431cc4c7","block_type":"box","text":"component of fixed income investment strategies at BlackRock, particularly for those with sustainability objectives in","page_number":186,"box":{"x":69,"y":198,"width":831,"height":11}},{"id":"eabf2ef6-e919-4b92-b190-bb9efa8fa84d","block_type":"box","text":"addition to financial objectives. Most corporate governance-related fixed income engagements are undertaken in","page_number":186,"box":{"x":69,"y":212,"width":801,"height":12}},{"id":"0f17ba76-a28e-445d-92ac-acf7a3d7f394","block_type":"box","text":"conjunction with the active investment stewardship team, and often active equity investors. In addition to the topics","page_number":186,"box":{"x":69,"y":227,"width":824,"height":11}},{"id":"19db86de-958a-4aae-ac83-e70c32a3f5eb","block_type":"box","text":"listed below, engagement with fixed income investment teams may help inform an issuer’s approach to structuring","page_number":186,"box":{"x":70,"y":242,"width":816,"height":11}},{"id":"c565312a-9cae-4c3e-b127-d0651d559885","block_type":"box","text":"specialist issuances and the standard terms and information in bond documentation.","page_number":186,"box":{"x":69,"y":257,"width":608,"height":11}},{"id":"96b1c550-7082-4d7a-827c-d7c991eb94eb","block_type":"box","text":"5","page_number":186,"box":{"x":69,"y":302,"width":4,"height":4}},{"id":"abe2a5b8-8069-4a61-8ab4-a7f08422c0f9","block_type":"box","text":"Non-index equity strategies include active equity holdings in BlackRock’s fundamental equity, systematic equity and","page_number":186,"box":{"x":79,"y":301,"width":820,"height":11}},{"id":"db64b1dc-d82c-4a03-9008-8f1af912fd23","block_type":"box","text":"multi-asset solutions strategies, as well as holdings in BlackRock’s index and active fixed income strategies, to the","page_number":186,"box":{"x":69,"y":316,"width":822,"height":12}},{"id":"0adc898c-b283-4ddc-b405-d82170da3558","block_type":"box","text":"extent those strategies hold voting securities or conduct issuer engagements.","page_number":186,"box":{"x":69,"y":332,"width":554,"height":11}},{"id":"231ea457-fc5c-4d16-954b-2d9e2e4ca7c7","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":186,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"c5134b4f-8b55-45ff-99f0-4f4b1fa11e94","block_type":"box","text":"Global Engagement and Voting Guidelines | 5","page_number":186,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"35144625-7715-460c-b1e8-83e590cc8f71","block_type":"box","text":"NM0926U-5977317-186/232","page_number":186,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"867caec4-4f57-4083-9360-1c4bd02d96e2","block_type":"box","text":"BOARDS OF DIRECTORS","page_number":187,"box":{"x":400,"y":45,"width":178,"height":9}},{"id":"45e817a4-06fe-467d-af4c-fd22015036dd","block_type":"box","text":"Roles and responsibilities","page_number":187,"box":{"x":69,"y":67,"width":186,"height":11}},{"id":"6eaf9a3f-bda9-4494-a3e0-ddcf707c4ff4","block_type":"box","text":"There is widespread consensus that the foundation of good corporate governance is an effective board of","page_number":187,"box":{"x":101,"y":86,"width":754,"height":11}},{"id":"ea94d624-a7c2-40ea-afdd-19986ee8ad0f","block_type":"box","text":"directors that is able to advise and supervise management in an independent and objective manner.","page_number":187,"box":{"x":69,"y":101,"width":715,"height":11}},{"id":"b76f6632-1913-411e-af00-fb63ad02a487","block_type":"box","text":"6","page_number":187,"box":{"x":786,"y":101,"width":4,"height":5}},{"id":"3c45d6e8-87fa-447a-a36e-d2157acd7c9d","block_type":"box","text":"We look to the board of directors (hereafter the “board”) to have an oversight role in the establishment and","page_number":187,"box":{"x":101,"y":119,"width":765,"height":12}},{"id":"173aea6a-4195-4e86-b896-4879d36f44d7","block_type":"box","text":"realization of a company’s strategy, purpose and culture. These constructs are interdependent and, when aligned,","page_number":187,"box":{"x":69,"y":134,"width":811,"height":12}},{"id":"187ba614-cd1a-4196-a1e7-6e86ff1420f9","block_type":"box","text":"can better position a company to be resilient in the face of a changing business environment, help reduce the risks","page_number":187,"box":{"x":69,"y":149,"width":822,"height":11}},{"id":"b79e8aa7-d3cf-4181-abe5-9de499b16a12","block_type":"box","text":"of corporate or employee misconduct, and attract and retain the caliber of workers necessary to deliver financial","page_number":187,"box":{"x":69,"y":164,"width":799,"height":11}},{"id":"9c2a0b62-9b02-472c-b98d-9419bdf363e5","block_type":"box","text":"performance over time.","page_number":187,"box":{"x":70,"y":179,"width":164,"height":11}},{"id":"b7032d4a-b27d-4f3f-a6fa-b9b90db8c1ea","block_type":"box","text":"In overseeing the management of the company, the board ensures the necessary resources, policies and","page_number":187,"box":{"x":102,"y":198,"width":750,"height":11}},{"id":"6b1e02c5-c5e9-4758-ad2d-d03a65e16511","block_type":"box","text":"procedures are in place to help management meet its strategic objectives within an agreed risk tolerance.","page_number":187,"box":{"x":70,"y":213,"width":753,"height":11}},{"id":"7d03eda8-2a5c-446d-b2b8-77272aa944f4","block_type":"box","text":"One of the most important responsibilities of the board is to appoint, and remove as necessary, the chief","page_number":187,"box":{"x":102,"y":231,"width":753,"height":11}},{"id":"f3214ccf-fe1e-4cf1-864a-9be2624764d1","block_type":"box","text":"executive officer (“CEO”). In addition, the board plays a meaningful role in monitoring the performance of the CEO","page_number":187,"box":{"x":69,"y":246,"width":811,"height":11}},{"id":"f1047c92-85f7-4104-a043-b49ebcca0254","block_type":"box","text":"and other key executives, determining executive compensation, ensuring a rigorous audit, overseeing strategy","page_number":187,"box":{"x":69,"y":261,"width":783,"height":11}},{"id":"eabf1ab2-ef30-4256-8278-42a4b80dc64a","block_type":"box","text":"execution and risk management and engaging with shareholders, and other stakeholders, as necessary.","page_number":187,"box":{"x":69,"y":276,"width":742,"height":11}},{"id":"f0c177df-d27f-4087-8ced-7c1aff01eeca","block_type":"box","text":"Composition and effectiveness","page_number":187,"box":{"x":69,"y":298,"width":224,"height":11}},{"id":"3e0f4893-dbca-49d2-9aca-62c0515dab8a","block_type":"box","text":"Appointment process","page_number":187,"box":{"x":68,"y":317,"width":152,"height":11}},{"id":"961dd925-cbd3-4cae-aa32-467c646607a1","block_type":"box","text":"A formal and transparent process for identifying and appointing director candidates is critical to ensuring the","page_number":187,"box":{"x":101,"y":335,"width":773,"height":12}},{"id":"32533875-5502-4479-bbc6-41ab1ac23b22","block_type":"box","text":"board is composed of directors with the appropriate mix of skills and experience. Generally, the board or a sub","page_number":187,"box":{"x":69,"y":350,"width":792,"height":11}},{"id":"b73bd750-7649-40a7-b58d-573f4ef418a7","block_type":"box","text":"committee determines the general criteria given the company’s circumstances (","page_number":187,"box":{"x":69,"y":365,"width":568,"height":11}},{"id":"b96c3026-0a3e-438f-a72c-954ed4826069","block_type":"box","text":"e.g.","page_number":187,"box":{"x":638,"y":367,"width":25,"height":9}},{"id":"38dce0c5-1960-4795-9e1d-7643d90ae74b","block_type":"box","text":", sector, maturity, geographic","page_number":187,"box":{"x":666,"y":365,"width":204,"height":11}},{"id":"2494f8d8-f148-4438-9558-a65f3ca7266e","block_type":"box","text":"footprint) and any additional criteria for a specific role being filled (","page_number":187,"box":{"x":68,"y":380,"width":474,"height":11}},{"id":"0eae9e58-c6dd-4c94-aab0-55a3f59ef3c9","block_type":"box","text":"e.g.","page_number":187,"box":{"x":544,"y":381,"width":25,"height":10}},{"id":"b038f0d1-8dbd-4a99-ad86-7c10fbfabcdc","block_type":"box","text":", financial expertise, industry track record). To","page_number":187,"box":{"x":571,"y":380,"width":327,"height":11}},{"id":"410c4fdd-b781-4d81-a76c-300f909cdccc","block_type":"box","text":"inform the process, we encourage companies to review the skills and experience of incumbent directors to identify","page_number":187,"box":{"x":70,"y":395,"width":815,"height":11}},{"id":"4e87aa25-973d-447e-ae10-01d164b7622d","block_type":"box","text":"any gaps and whether the skills and experience of a director candidate would be additive. We welcome disclosures","page_number":187,"box":{"x":69,"y":410,"width":817,"height":11}},{"id":"956053a0-28ee-43d4-bd47-67575a505d4b","block_type":"box","text":"that explain how the board considered different skills and experience to ensure that the directors collectively can be","page_number":187,"box":{"x":68,"y":425,"width":829,"height":11}},{"id":"f1c3a768-a214-49f1-a898-41361685a0fe","block_type":"box","text":"effective in fulfilling their responsibilities. We assess a company’s board composition against that of its peer group","page_number":187,"box":{"x":69,"y":439,"width":821,"height":12}},{"id":"14a8e897-4d95-4453-9170-11fb22317397","block_type":"box","text":"and local market requirements.","page_number":187,"box":{"x":69,"y":455,"width":221,"height":10}},{"id":"deaea1dc-b250-491c-bba4-a922d4289e10","block_type":"box","text":"Shareholders periodically vote to elect directors to serve on the board. We do not prescribe any particular board","page_number":187,"box":{"x":102,"y":473,"width":798,"height":11}},{"id":"1a7904f4-143d-449e-92b0-aad1357d11c7","block_type":"box","text":"composition in our engagements or voting but seek to understand how well placed a board is to act in investors’","page_number":187,"box":{"x":69,"y":488,"width":800,"height":11}},{"id":"2f010bd6-8ebd-48c3-b726-e29bf7dcf4a3","block_type":"box","text":"interests. We may vote against the election of the most senior independent director, or the chair of the relevant","page_number":187,"box":{"x":70,"y":503,"width":794,"height":11}},{"id":"a6b2c683-7ae9-4051-9ab0-d6456be9ceda","block_type":"box","text":"committee, where a company has not demonstrated it has an appointment process that results in a high functioning","page_number":187,"box":{"x":69,"y":517,"width":830,"height":12}},{"id":"14ae279e-2771-467d-b695-a0d08d4e28c3","block_type":"box","text":"board with the appropriate complement of skills and experience amongst the directors to support strong financial","page_number":187,"box":{"x":69,"y":532,"width":808,"height":12}},{"id":"118efde9-13b2-4f1c-8e7a-796f3add6040","block_type":"box","text":"performance over time. We may vote against newly nominated directors who do not seem to have the appropriate","page_number":187,"box":{"x":70,"y":547,"width":808,"height":12}},{"id":"e392dafd-852e-4f49-9359-5400688ec4b7","block_type":"box","text":"skills or experience to contribute to the board’s effectiveness.","page_number":187,"box":{"x":69,"y":562,"width":442,"height":11}},{"id":"9ae720f8-6a84-4058-9822-bb806860ba42","block_type":"box","text":"Independence","page_number":187,"box":{"x":70,"y":585,"width":99,"height":10}},{"id":"46c1bd27-58d2-4d83-b731-1446f5907078","block_type":"box","text":"Director independence from management, significant shareholders or other stakeholders (","page_number":187,"box":{"x":102,"y":603,"width":642,"height":11}},{"id":"282a88b6-fb98-4838-9ef0-131a2a5f519f","block_type":"box","text":"e.g.","page_number":187,"box":{"x":746,"y":605,"width":25,"height":9}},{"id":"7c476fbb-f958-4f0a-8ab8-f08c63464d76","block_type":"box","text":", government or","page_number":187,"box":{"x":773,"y":604,"width":111,"height":10}},{"id":"8a63d44d-7f75-487d-9cf9-526487f87066","block_type":"box","text":"employees) is of paramount importance to the protection of the interests of minority shareholders such as","page_number":187,"box":{"x":69,"y":618,"width":759,"height":11}},{"id":"45180923-e311-43d4-b580-3b019af85590","block_type":"box","text":"BlackRock’s clients. We consider it good practice for at least half the directors to be independent and free from","page_number":187,"box":{"x":70,"y":633,"width":793,"height":11}},{"id":"8d3eb80e-bfdd-4de6-8207-7ce115d9bad3","block_type":"box","text":"conflicts of interest or undue influence.","page_number":187,"box":{"x":69,"y":648,"width":278,"height":9}},{"id":"698b9b88-401f-462f-a0e1-de2dad346149","block_type":"box","text":"7","page_number":187,"box":{"x":349,"y":648,"width":4,"height":5}},{"id":"43b738e4-e7be-43a8-8ca6-53991463588f","block_type":"box","text":"This also helps to ensure that board committees are composed of a","page_number":187,"box":{"x":358,"y":648,"width":486,"height":11}},{"id":"1ea587e4-5f31-480b-93e6-d702920b8c53","block_type":"box","text":"sufficient number of independent directors. Companies domiciled in markets with a higher threshold for board","page_number":187,"box":{"x":69,"y":663,"width":783,"height":11}},{"id":"95eebc62-c307-45b0-acd6-da68371af0b0","block_type":"box","text":"independence should meet those local requirements.","page_number":187,"box":{"x":70,"y":678,"width":378,"height":10}},{"id":"68dde7f0-94ed-4ce2-872b-d38cac8e61f9","block_type":"box","text":"We may vote against the election of non-independent directors if the board does not have a sufficient balance of","page_number":187,"box":{"x":101,"y":696,"width":803,"height":11}},{"id":"a4a7075d-9ffb-42f4-b9c5-b04365750c86","block_type":"box","text":"independence. We may also vote against the election of the chair of the committee responsible for board","page_number":187,"box":{"x":70,"y":711,"width":748,"height":11}},{"id":"cf5b670b-24db-4071-bad2-6f90514c2975","block_type":"box","text":"composition if this is a perennial issue.","page_number":187,"box":{"x":69,"y":726,"width":280,"height":11}},{"id":"8cedd647-9ac9-439d-b1ba-0ad9b3d542f5","block_type":"box","text":"6","page_number":187,"box":{"x":69,"y":756,"width":4,"height":4}},{"id":"decbd094-b82e-48e2-86df-1194de6f3d56","block_type":"box","text":"See the Corporate Governance Codes of Germany, Japan, and the UK, as well as the corporate governance","page_number":187,"box":{"x":93,"y":755,"width":763,"height":11}},{"id":"c6b2479b-49c7-4eed-8c29-d13546c7fb03","block_type":"box","text":"principles of the US Business Roundtable as examples.","page_number":187,"box":{"x":94,"y":770,"width":394,"height":11}},{"id":"b76b9c8e-f9fc-40cd-9c26-db4233f50164","block_type":"box","text":"7","page_number":187,"box":{"x":69,"y":788,"width":4,"height":5}},{"id":"4b822383-fbca-4dde-9713-5fb1b50a25d4","block_type":"box","text":"Common impediments to independence may include but are not limited to: current or recent employment at the","page_number":187,"box":{"x":93,"y":788,"width":795,"height":11}},{"id":"8153d171-6227-480a-8ebd-2b7ef05c4ff6","block_type":"box","text":"company or a subsidiary; being, or representing, a shareholder with a substantial shareholding in the company;","page_number":187,"box":{"x":93,"y":803,"width":793,"height":11}},{"id":"9e8ab532-a14f-498a-9bd9-3fafe9d41d53","block_type":"box","text":"interlocking directorships; lengthy tenure, and having any other interest, business, or other relationship which","page_number":187,"box":{"x":94,"y":818,"width":778,"height":11}},{"id":"02262b43-08cd-4a4b-9e83-ed3a000ba97c","block_type":"box","text":"could, or could reasonably be perceived to, materially interfere with a director’s ability to act in the best interests","page_number":187,"box":{"x":93,"y":833,"width":807,"height":11}},{"id":"2812a685-9e0f-4998-ad83-44d2fd3cd1dc","block_type":"box","text":"of the company and shareholders.","page_number":187,"box":{"x":93,"y":848,"width":242,"height":11}},{"id":"7447fd30-df9e-4c62-ae8f-33581186ffee","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":187,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"72ce29eb-9cbd-4c3c-906b-4ec3c4b8f044","block_type":"box","text":"Global Engagement and Voting Guidelines | 6","page_number":187,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"d1f095c9-0fed-4576-b717-56e5a59c8f4f","block_type":"box","text":"NM0926U-5977317-187/232","page_number":187,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"2c59ee0c-94a1-4c1e-b1be-129513b5a1ea","block_type":"box","text":"Independent board leadership","page_number":188,"box":{"x":70,"y":45,"width":212,"height":11}},{"id":"34e3e32b-364b-4153-9438-d945f41e59f2","block_type":"box","text":"Practices across markets differ, as do board structures, but we observe two main approaches to independent","page_number":188,"box":{"x":102,"y":63,"width":784,"height":11}},{"id":"7156a8e0-68e1-4edd-94bb-6f219e4b37b9","block_type":"box","text":"board leadership. One is a non-executive, independent chair of the board who is responsible for leading the board in","page_number":188,"box":{"x":69,"y":78,"width":827,"height":11}},{"id":"e37f0bc1-e6c4-4c1e-a350-7d0ee9f7a5a0","block_type":"box","text":"the effective exercise of its duties. The other is a lead or senior independent director, who is responsible for","page_number":188,"box":{"x":68,"y":93,"width":774,"height":11}},{"id":"72de0e9c-4342-4710-97db-df330d82ff42","block_type":"box","text":"coordinating with the other non-executive directors and working closely with the executive chair on the board agenda","page_number":188,"box":{"x":69,"y":108,"width":826,"height":11}},{"id":"fd8f590c-6a08-4381-ad33-4072a02f345c","block_type":"box","text":"and other board procedures. In this case, the executive chair and the lead independent director work together to","page_number":188,"box":{"x":69,"y":123,"width":801,"height":11}},{"id":"65efa4f4-2603-4610-b472-351fe5fbd84a","block_type":"box","text":"ensure the board is effectively fulfilling its responsibilities. In our view, the independent leader of the board, and/or","page_number":188,"box":{"x":69,"y":138,"width":823,"height":11}},{"id":"a3528c80-aa3d-4c0b-8365-db2694c0a64b","block_type":"box","text":"the chair of a relevant committee, should be available to investors to discuss governance matters such as CEO","page_number":188,"box":{"x":68,"y":152,"width":793,"height":12}},{"id":"092734f1-a34e-4f48-953f-944e81b1d43c","block_type":"box","text":"succession, executive pay, and board performance. We look to boards to explain their board leadership model and","page_number":188,"box":{"x":69,"y":167,"width":816,"height":11}},{"id":"e32d9f0a-5d7f-4847-90ac-5ebf1086f7f1","block_type":"box","text":"how it serves the interests of shareholders.","page_number":188,"box":{"x":69,"y":182,"width":311,"height":9}},{"id":"c239ab85-c788-46fa-ae87-4dba3dfa20b9","block_type":"box","text":"We may vote against the election of the chair of the committee responsible for board composition if there is not","page_number":188,"box":{"x":101,"y":201,"width":798,"height":11}},{"id":"7c2bb04c-9de9-4a56-b299-1dffc0655f67","block_type":"box","text":"an identified independent leader of the board with clear responsibilities for board performance. We may vote against","page_number":188,"box":{"x":69,"y":216,"width":831,"height":11}},{"id":"a68f4998-f18a-4e33-9dfe-ec67e455b062","block_type":"box","text":"the most senior independent director if the board has a policy of not engaging with shareholders.","page_number":188,"box":{"x":68,"y":231,"width":691,"height":11}},{"id":"d69efebe-ddd9-4054-9f20-7d437aa745e7","block_type":"box","text":"Tenure and succession","page_number":188,"box":{"x":70,"y":253,"width":162,"height":9}},{"id":"6f019aab-76d6-413c-b405-442b3db8daa2","block_type":"box","text":"In our view, it is good practice for boards to establish the length of time a director would normally be expected to","page_number":188,"box":{"x":102,"y":272,"width":803,"height":11}},{"id":"9d12a104-f11b-4c7b-abda-7681b12fd840","block_type":"box","text":"serve, in line with market norms where those exist. We find it helpful when companies disclose their approach to","page_number":188,"box":{"x":69,"y":286,"width":805,"height":11}},{"id":"212651c7-bcb6-4e31-815d-d18e6e1f9fb6","block_type":"box","text":"director tenure particularly around the contributions of directors who have served for longer periods than typically","page_number":188,"box":{"x":69,"y":301,"width":806,"height":12}},{"id":"56da81e5-d539-420f-a49b-a1f25f18f06c","block_type":"box","text":"provided for under local practice. In our experience, long-serving directors could become less independent given their","page_number":188,"box":{"x":70,"y":316,"width":833,"height":12}},{"id":"6f188382-1b17-4b5c-a7d3-9c036851fcab","block_type":"box","text":"long-term relationship with management and involvement in past board decisions.","page_number":188,"box":{"x":70,"y":331,"width":581,"height":11}},{"id":"8a800592-24f5-4cf9-84e4-2d3d157ec2e3","block_type":"box","text":"Succession planning for board roles helps achieve the appropriate cadence of turnover that balances renewal","page_number":188,"box":{"x":102,"y":350,"width":779,"height":11}},{"id":"dc403806-524e-49d4-947c-255fd5aa3459","block_type":"box","text":"through the regular introduction of directors with fresh perspectives and expertise with continuity through the","page_number":188,"box":{"x":68,"y":365,"width":777,"height":11}},{"id":"b0df1779-982f-47eb-980d-dcec3a525f27","block_type":"box","text":"retention of directors with long-term knowledge of the board and company.","page_number":188,"box":{"x":69,"y":379,"width":528,"height":12}},{"id":"41093aca-c020-4d5b-9b0c-a6ebf0fa0a09","block_type":"box","text":"In markets where there is not specific director tenure guidance from regulation or corporate governance best","page_number":188,"box":{"x":102,"y":398,"width":774,"height":11}},{"id":"38962501-b27f-45a0-b3f3-9765ebaf0db7","block_type":"box","text":"practices, we may vote against the election of the chair of the committee responsible for board composition if a","page_number":188,"box":{"x":70,"y":413,"width":795,"height":11}},{"id":"aa2f4cc4-3abd-45ef-a2b5-ea9d4ad2f5b3","block_type":"box","text":"company does not clearly disclose its approach to director tenure and board renewal. We may vote against the","page_number":188,"box":{"x":69,"y":428,"width":788,"height":11}},{"id":"21944b73-2473-40fe-8615-cd1bfa27c5b9","block_type":"box","text":"election of directors who have served for more years than is typical in markets with specific guidance, where the case","page_number":188,"box":{"x":69,"y":443,"width":839,"height":11}},{"id":"4142f325-532e-4cae-9a6c-fa794a57b0ce","block_type":"box","text":"for their continued service is not evident.","page_number":188,"box":{"x":68,"y":458,"width":292,"height":9}},{"id":"a275c46a-234d-468d-a499-314710510ce3","block_type":"box","text":"Capacity","page_number":188,"box":{"x":70,"y":480,"width":60,"height":11}},{"id":"250cb25a-3a2f-45cb-b5c0-083687da1591","block_type":"box","text":"To be effective and engaged, directors need to have the time and energy to commit to the role. In our view, an","page_number":188,"box":{"x":101,"y":499,"width":784,"height":11}},{"id":"c8105100-c464-4904-8961-6ef64a9ad680","block_type":"box","text":"effective board will assess the ability of its members to maintain an appropriate focus on board matters and the","page_number":188,"box":{"x":69,"y":513,"width":801,"height":12}},{"id":"55869447-9561-4309-a887-6ba72c25a1d3","block_type":"box","text":"company taking into consideration competing responsibilities. We recognize that board leadership roles vary across","page_number":188,"box":{"x":69,"y":529,"width":823,"height":11}},{"id":"5b0b6497-4348-4a33-b830-1719f1c581bd","block_type":"box","text":"markets in responsibilities and required time commitment but note that they are generally more intensive than a","page_number":188,"box":{"x":69,"y":543,"width":800,"height":11}},{"id":"96fa511c-4de4-40d2-b39b-ecda16aa743b","block_type":"box","text":"standard directorship. We will take local norms and practices into consideration when making our voting","page_number":188,"box":{"x":69,"y":558,"width":741,"height":11}},{"id":"1b7fa03f-0e00-4e1c-9629-bf88b85e60c8","block_type":"box","text":"determinations across markets.","page_number":188,"box":{"x":69,"y":573,"width":226,"height":9}},{"id":"53c559f3-644e-4ae1-bdcc-0a20854ce119","block_type":"box","text":"We may vote against the election of directors who do not seem to have sufficient capacity to effectively fulfill","page_number":188,"box":{"x":101,"y":592,"width":776,"height":11}},{"id":"5e70e3cf-74cc-45cb-864b-2d96f0da069d","block_type":"box","text":"their duties to the board and company.","page_number":188,"box":{"x":68,"y":607,"width":275,"height":11}},{"id":"35f8e7aa-8032-42a9-b528-d932deb7396f","block_type":"box","text":"Director elections","page_number":188,"box":{"x":70,"y":629,"width":124,"height":9}},{"id":"c63d188c-2f7f-45c5-8c60-3b597ff59102","block_type":"box","text":"Regular election of directors, ideally annually, supports director accountability to shareholders. A classified board","page_number":188,"box":{"x":102,"y":647,"width":805,"height":12}},{"id":"307466c9-0be0-4353-b850-ea159ec78153","block_type":"box","text":"structure","page_number":188,"box":{"x":69,"y":663,"width":63,"height":8}},{"id":"da0a688c-1e96-45b6-8351-581fd5e2eba5","block_type":"box","text":"8","page_number":188,"box":{"x":133,"y":663,"width":4,"height":4}},{"id":"379d7e9a-5e46-45c5-85a1-1836d4fc3aad","block_type":"box","text":"may be justified by a company when it needs consistency and stability during a time of transition, or on the","page_number":188,"box":{"x":144,"y":662,"width":761,"height":12}},{"id":"98ffe598-8636-4e44-b129-7d8e6dd41ec4","block_type":"box","text":"basis of its business model (","page_number":188,"box":{"x":69,"y":677,"width":206,"height":11}},{"id":"843781f9-fe98-47c2-8452-d898d79b97a7","block_type":"box","text":"e.g.","page_number":188,"box":{"x":277,"y":679,"width":24,"height":10}},{"id":"bf0a3f76-4979-4717-8919-8c1b9750e6e5","block_type":"box","text":", a non-operating company such as closed-end funds).","page_number":188,"box":{"x":304,"y":677,"width":382,"height":12}},{"id":"46061b56-9f30-462b-83f1-40cdda464131","block_type":"box","text":"Shareholders should have the opportunity to evaluate nominated directors individually rather than in bundled","page_number":188,"box":{"x":102,"y":696,"width":774,"height":11}},{"id":"f0407233-da8b-4604-b937-8cec48c720b8","block_type":"box","text":"slates. We look to companies to provide sufficient information on each director standing for election so that","page_number":188,"box":{"x":69,"y":711,"width":770,"height":11}},{"id":"56232354-3d4b-476a-a931-f815dd486cd1","block_type":"box","text":"shareholders can assess their capabilities and suitability. We will generally not support the election of directors","page_number":188,"box":{"x":69,"y":726,"width":794,"height":11}},{"id":"0e4b2b02-e49f-4e56-b055-05a5205406b3","block_type":"box","text":"whose names and biographical details have not been disclosed sufficiently in advance of the shareholder meeting.","page_number":188,"box":{"x":68,"y":740,"width":818,"height":12}},{"id":"215f1bb5-7874-4441-bb4a-aa25a092d2bc","block_type":"box","text":"Each director’s appointment should be dependent on receiving a simple majority of the votes cast at the","page_number":188,"box":{"x":102,"y":759,"width":743,"height":11}},{"id":"165c3c10-235a-4249-b6b1-ab8b5346a6e6","block_type":"box","text":"shareholder meeting. Where a company’s practices differ, we look to the board to provide a detailed explanation as","page_number":188,"box":{"x":69,"y":774,"width":823,"height":11}},{"id":"174d2d76-d9cd-4e5a-8128-11ce32068b5f","block_type":"box","text":"to how its approach best serves investors’ interests.","page_number":188,"box":{"x":68,"y":789,"width":377,"height":11}},{"id":"dff7c5f4-59ba-4c7c-a672-0b9a95f92983","block_type":"box","text":"We may vote for shareholder or management proposals seeking to establish annual election of directors and/or","page_number":188,"box":{"x":101,"y":807,"width":798,"height":12}},{"id":"c1b33e7a-1b41-4799-a2cd-8012d7f66731","block_type":"box","text":"a simple majority vote standard for director elections. We may vote against all the directors standing for election as","page_number":188,"box":{"x":69,"y":822,"width":822,"height":12}},{"id":"ee68a1b3-0335-495a-9196-8b7e0ab7aea0","block_type":"box","text":"part of a single slate if we have concerns about the profile or performance of an individual director.","page_number":188,"box":{"x":70,"y":837,"width":706,"height":12}},{"id":"04e8b095-9e2b-49bb-9f90-52cb71e01323","block_type":"box","text":"8","page_number":188,"box":{"x":69,"y":867,"width":4,"height":4}},{"id":"be8c4202-1dab-405e-94d7-1215daff10ae","block_type":"box","text":"A classified board divides the directors into classes with different overlapping terms. As a result, only one class of","page_number":188,"box":{"x":78,"y":866,"width":818,"height":12}},{"id":"465ee9ac-c201-4765-bb44-df834dc48e5d","block_type":"box","text":"directors stands for election in any one year.","page_number":188,"box":{"x":69,"y":882,"width":315,"height":11}},{"id":"8c3b57e4-6b48-4e51-9f66-966c51855b13","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":188,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"75dcc8c8-8d06-46e7-89ce-5ab3fd403f75","block_type":"box","text":"Global Engagement and Voting Guidelines | 7","page_number":188,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"94d210c3-fcc9-48a8-8b2b-e53dc38b9e61","block_type":"box","text":"NM0926U-5977317-188/232","page_number":188,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"a5cac6fd-2f6a-4f67-bf4d-41691b9070fc","block_type":"box","text":"Committees","page_number":189,"box":{"x":70,"y":45,"width":84,"height":9}},{"id":"f6d21aff-ed74-430c-b56b-71a98d3c7bd4","block_type":"box","text":"Many boards establish committees to focus on specific responsibilities of the board such as audit and risk,","page_number":189,"box":{"x":102,"y":63,"width":766,"height":11}},{"id":"2f02966f-be12-4e14-95e3-5de26cdfbc68","block_type":"box","text":"governance and human capital, and executive compensation, amongst other matters. We do not prescribe to","page_number":189,"box":{"x":68,"y":78,"width":776,"height":11}},{"id":"449ef29d-66c7-475c-a7ee-6563f41acc0f","block_type":"box","text":"companies what committees they should establish, but we seek to understand the board’s rationale for the","page_number":189,"box":{"x":69,"y":93,"width":766,"height":11}},{"id":"043be5de-d3bb-4c41-baf1-e2baa50cc95b","block_type":"box","text":"committee structure it determines is appropriate. We note that, in some markets, regulation requires such","page_number":189,"box":{"x":69,"y":108,"width":759,"height":11}},{"id":"594d3dba-9ab4-4a4e-a9b8-83c6840f11b3","block_type":"box","text":"committees. The responsibilities of each committee should be clear, and the board should ensure that all critical","page_number":189,"box":{"x":69,"y":123,"width":804,"height":11}},{"id":"3f973dcd-c065-4bdd-b181-8d317bc63381","block_type":"box","text":"matters are assigned either to the full board or to one of the committees. It is helpful to investor understanding when","page_number":189,"box":{"x":69,"y":138,"width":837,"height":11}},{"id":"57f51bf6-4a95-4d64-b6d0-e28aceacda4c","block_type":"box","text":"the board discloses the structure, membership, proportion of independent directors, and responsibilities of each","page_number":189,"box":{"x":68,"y":152,"width":806,"height":11}},{"id":"e20cd8d6-e2ef-4533-957c-a9a3ed53df16","block_type":"box","text":"committee. The responsibilities we typically see assigned to the three most common committees include:","page_number":189,"box":{"x":69,"y":168,"width":752,"height":11}},{"id":"2ca81aca-0031-48ce-8a8e-0e3de1ab2a06","block_type":"box","text":"•","page_number":189,"box":{"x":69,"y":188,"width":6,"height":4}},{"id":"8ff6e061-0fef-4e4e-ab2e-5d1d75d414d0","block_type":"box","text":"Audit and risk – oversight responsibilities for the integrity of financial reporting, risk management and","page_number":189,"box":{"x":101,"y":185,"width":722,"height":11}},{"id":"a01e0bda-669f-4b3a-b1ea-810b254f1cc3","block_type":"box","text":"compliance with legal and regulatory requirements; may also play an oversight role in relation to the internal","page_number":189,"box":{"x":101,"y":200,"width":771,"height":11}},{"id":"2e2634ab-692f-4f15-98b3-c44cb1e63a1d","block_type":"box","text":"audit function and whistleblowing mechanisms.","page_number":189,"box":{"x":102,"y":214,"width":335,"height":12}},{"id":"0e31a4b1-2a83-42dc-bfb5-caf5bbf7d305","block_type":"box","text":"•","page_number":189,"box":{"x":69,"y":235,"width":6,"height":4}},{"id":"2eb170c5-5e82-4afb-89af-4f6b80388178","block_type":"box","text":"Nominating, governance and human capital – oversight responsibilities for corporate governance principles and","page_number":189,"box":{"x":102,"y":232,"width":790,"height":11}},{"id":"42faa7dd-b695-4cc7-bc44-ea3cd3e08d4a","block_type":"box","text":"practices of the company, including the periodic review of board performance; responsibility for succession","page_number":189,"box":{"x":102,"y":247,"width":761,"height":11}},{"id":"3a1866e5-3ed4-49b0-879c-3c2cb0f57d9a","block_type":"box","text":"planning for CEO and key board roles, as well as the director appointment process; may also have oversight","page_number":189,"box":{"x":102,"y":262,"width":769,"height":11}},{"id":"6f335c61-7369-447f-b235-282c634042c3","block_type":"box","text":"responsibilities for human capital management strategies, including corporate culture and purpose.","page_number":189,"box":{"x":102,"y":276,"width":707,"height":12}},{"id":"5f5012fa-7e18-4a20-9fd0-a6658599d353","block_type":"box","text":"•","page_number":189,"box":{"x":69,"y":297,"width":6,"height":4}},{"id":"6f7f9865-10ca-4eaf-8cfe-9091caf9f521","block_type":"box","text":"Executive compensation – determines the compensation policies and programs for the CEO and other executive","page_number":189,"box":{"x":102,"y":294,"width":796,"height":11}},{"id":"fd417c7b-4eba-44a5-bb65-4f989a6c4baf","block_type":"box","text":"officers, approves annual awards and payments under the policies; may also have oversight responsibilities for","page_number":189,"box":{"x":102,"y":309,"width":793,"height":11}},{"id":"bdb1de52-2042-4a0c-b8ce-ff590e0a5eab","block_type":"box","text":"firm-wide compensation policies.","page_number":189,"box":{"x":101,"y":323,"width":232,"height":11}},{"id":"7fe3bc71-4355-4906-abb9-0a34ca6a4603","block_type":"box","text":"We may vote against the election of the chair of the committee or other directors serving as committee members","page_number":189,"box":{"x":101,"y":342,"width":807,"height":11}},{"id":"b182b453-ddae-40ae-9215-3936b6d41478","block_type":"box","text":"to convey concerns about how a committee has undertaken its responsibilities. We may vote against the election of","page_number":189,"box":{"x":68,"y":357,"width":828,"height":11}},{"id":"023b79f3-49c5-4bd7-b092-358d1e6c473e","block_type":"box","text":"the most senior non-executive director if there is not a clearly disclosed approach to board committees.","page_number":189,"box":{"x":68,"y":372,"width":738,"height":11}},{"id":"4038c842-4a3f-47bf-8033-68155e61c5ef","block_type":"box","text":"Board and director evaluation","page_number":189,"box":{"x":70,"y":395,"width":209,"height":8}},{"id":"ebaf979b-6a21-4356-b22f-947e98e6a70f","block_type":"box","text":"We consider it best practice for companies to conduct an annual review of the performance of the board, the","page_number":189,"box":{"x":101,"y":413,"width":776,"height":11}},{"id":"3f6b36e6-8a7a-46af-8c02-f04c25fc34b7","block_type":"box","text":"committees, the chair and individual directors. Periodically, this review could be undertaken by an independent third","page_number":189,"box":{"x":69,"y":428,"width":825,"height":11}},{"id":"5a2c5ccf-67b4-418f-9a41-4580d3905b97","block_type":"box","text":"party able to bring objective perspectives to the board on governance and performance. We encourage companies to","page_number":189,"box":{"x":70,"y":443,"width":831,"height":11}},{"id":"c3fafc83-6451-4932-8f81-bb54e9126525","block_type":"box","text":"disclose their approach to and the objectives of evaluations, including any changes made to the board’s approach as","page_number":189,"box":{"x":69,"y":458,"width":835,"height":11}},{"id":"eec1fb30-5200-4b6d-8ee6-98433ee095a1","block_type":"box","text":"a result.","page_number":189,"box":{"x":69,"y":473,"width":57,"height":8}},{"id":"443152ab-6b13-4f46-aad0-0e1a21e94dec","block_type":"box","text":"Access to independent advice","page_number":189,"box":{"x":68,"y":495,"width":214,"height":11}},{"id":"dbc8c232-fb9d-4130-87d3-f96a45d0582d","block_type":"box","text":"To support the directors in effectively fulfilling their duties to the company and shareholders, they should have","page_number":189,"box":{"x":101,"y":513,"width":786,"height":12}},{"id":"d0168edb-51ff-41db-b2e3-aecdf41a6729","block_type":"box","text":"access to independent advice. In certain circumstances, it may be helpful to boards to retain independent third","page_number":189,"box":{"x":69,"y":528,"width":793,"height":11}},{"id":"c9a90aed-a91e-4aa8-ada2-a6387b410f3f","block_type":"box","text":"parties to advise on critical matters. These might include new industry developments such as emergent and","page_number":189,"box":{"x":70,"y":543,"width":770,"height":11}},{"id":"5582239f-4801-4ad1-89f2-6cfab2f9e01d","block_type":"box","text":"disruptive technology, operating events with material consequences for the company’s reputation and/or","page_number":189,"box":{"x":69,"y":558,"width":746,"height":11}},{"id":"bafcd6de-d3c1-42f5-ae95-3438a5ff7968","block_type":"box","text":"performance, or significant transactions. Board committees may similarly retain third parties to advise them on","page_number":189,"box":{"x":70,"y":573,"width":793,"height":11}},{"id":"1f808c72-b654-42f1-accc-8247c6bd1c62","block_type":"box","text":"specialist matters such as audit, compensation and succession planning.","page_number":189,"box":{"x":69,"y":588,"width":524,"height":11}},{"id":"6fd01a57-58f6-4d4c-bbed-d3958470a230","block_type":"box","text":"EXECUTIVE COMPENSATION","page_number":189,"box":{"x":385,"y":618,"width":207,"height":9}},{"id":"34fc4cee-7b9c-4b8a-81a2-9326e11337bb","block_type":"box","text":"Boards play an important role in establishing compensation arrangements that enable the company to recruit,","page_number":189,"box":{"x":102,"y":637,"width":784,"height":11}},{"id":"d09cfb8a-85a9-4a65-8419-9f794b256d73","block_type":"box","text":"retain and reward the caliber of executive management necessary to lead and operate the company to deliver","page_number":189,"box":{"x":69,"y":652,"width":782,"height":11}},{"id":"7ec6105b-8fa4-43a4-b269-41e76e1d3229","block_type":"box","text":"superior financial returns over time. We focus on alignment between variable pay and a company’s financial","page_number":189,"box":{"x":69,"y":666,"width":766,"height":12}},{"id":"af502f99-2277-41b7-9dac-7c652fc47f22","block_type":"box","text":"performance.","page_number":189,"box":{"x":70,"y":681,"width":93,"height":11}},{"id":"d995a115-a986-4ca7-a1d9-e6fd3dfec765","block_type":"box","text":"Generally, executive compensation arrangements have four components: base salary, annual bonus that rewards","page_number":189,"box":{"x":102,"y":700,"width":805,"height":11}},{"id":"f3d34622-e2ef-4031-a963-7fb65a579e6e","block_type":"box","text":"performance against short-term metrics, incentives – most often share-based that reward performance against long","page_number":189,"box":{"x":70,"y":715,"width":831,"height":11}},{"id":"63728a1c-9302-4aeb-b47f-cd61d5d38899","block_type":"box","text":"term metrics, and pensions and benefits. In our observation, base salary, pensions and benefits are largely set","page_number":189,"box":{"x":68,"y":730,"width":798,"height":11}},{"id":"b67d9102-bd92-4a5f-803b-8c32bb976cc2","block_type":"box","text":"relative to market norms and benchmarks. The annual bonus and share-based incentive, or variable pay plans, tend","page_number":189,"box":{"x":69,"y":745,"width":824,"height":11}},{"id":"f4e84db7-4d69-4294-a458-37823c95efcd","block_type":"box","text":"to be tailored to the company, its sector and long-term strategy, as well as the individuals the board is seeking to","page_number":189,"box":{"x":68,"y":760,"width":807,"height":11}},{"id":"901b6608-7d3f-4390-9705-19f71ebb5354","block_type":"box","text":"recruit and motivate.","page_number":189,"box":{"x":69,"y":774,"width":146,"height":9}},{"id":"b2b5e936-ceef-4c71-81c1-e166f3d20e7e","block_type":"box","text":"Recognizing the unique circumstances of each company, we determine whether to support a company’s","page_number":189,"box":{"x":102,"y":793,"width":739,"height":11}},{"id":"36bc0ea8-3edf-4e54-b0cd-73c192493374","block_type":"box","text":"approach to executive compensation on a case-by-case basis. We rely on companies providing sufficient quantitative","page_number":189,"box":{"x":69,"y":808,"width":831,"height":11}},{"id":"b57c557d-b4a6-4d0a-bd85-9ed20a41856e","block_type":"box","text":"and qualitative information in their disclosures to enable shareholders to understand the compensation","page_number":189,"box":{"x":69,"y":823,"width":737,"height":11}},{"id":"70222c2a-19ff-474b-b08f-fab696bbb87a","block_type":"box","text":"arrangements and assess the alignment with investors’ interests. Features we look for in compensation","page_number":189,"box":{"x":69,"y":837,"width":741,"height":12}},{"id":"35831db9-c2bd-462f-96cd-624e1163f22c","block_type":"box","text":"arrangements include:","page_number":189,"box":{"x":69,"y":853,"width":157,"height":11}},{"id":"cd4c1ce9-740f-43dd-ad50-377fc5a73cbf","block_type":"box","text":"•","page_number":189,"box":{"x":69,"y":873,"width":6,"height":4}},{"id":"607f0724-c76b-47be-8070-78143bbac0ab","block_type":"box","text":"Fixed pay components, including base salary, benefits and prerequisites that are appropriate in the context of","page_number":189,"box":{"x":102,"y":870,"width":783,"height":11}},{"id":"06010c16-15c3-4341-b24b-6c0e4f8a2490","block_type":"box","text":"the company’s size, sector and market.","page_number":189,"box":{"x":101,"y":885,"width":280,"height":11}},{"id":"89641a0e-0a19-47f5-8fd7-b00a16a0f7a2","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":189,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"c69fc672-bd0e-46ca-a30b-5687c2f56b1c","block_type":"box","text":"Global Engagement and Voting Guidelines | 8","page_number":189,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"77f2ed00-fabb-4890-b363-e4a88ff16157","block_type":"box","text":"NM0926U-5977317-189/232","page_number":189,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"1d6b6fa0-714d-4d37-9576-9c5ee3b536ae","block_type":"box","text":"•","page_number":190,"box":{"x":69,"y":48,"width":6,"height":4}},{"id":"5e44e093-60f7-4d35-94d5-3bf9e0e56751","block_type":"box","text":"Variable pay subject to performance metrics that are closely linked to the company’s short- and long-term","page_number":190,"box":{"x":101,"y":45,"width":752,"height":11}},{"id":"7fe3996e-a5be-4015-8466-3f4b798cd111","block_type":"box","text":"strategic objectives.","page_number":190,"box":{"x":102,"y":60,"width":140,"height":11}},{"id":"7036fc21-a969-43a2-bab1-9934f0d37c99","block_type":"box","text":"•","page_number":190,"box":{"x":69,"y":80,"width":6,"height":4}},{"id":"fa5154f6-1b1e-42d1-8239-be46e118fff0","block_type":"box","text":"Long-term incentives that motivate sustained performance across a multi-year period.","page_number":190,"box":{"x":102,"y":77,"width":609,"height":11}},{"id":"003c96a8-2b74-4db1-9f8d-786f839dde81","block_type":"box","text":"•","page_number":190,"box":{"x":69,"y":97,"width":6,"height":5}},{"id":"a8802c06-d97a-4e29-9278-216e4811ac53","block_type":"box","text":"A balance between fixed and variable pay, short- and long-term incentives, and specific instruments (cash and","page_number":190,"box":{"x":101,"y":94,"width":784,"height":12}},{"id":"23757415-7bed-4c77-b07f-bba61068b605","block_type":"box","text":"equity awards) that promotes pay program durability and seldom necessitates one-off, discretionary payments.","page_number":190,"box":{"x":101,"y":109,"width":790,"height":11}},{"id":"8435113d-6922-48ee-b503-6b7b9e51a711","block_type":"box","text":"•","page_number":190,"box":{"x":69,"y":129,"width":6,"height":5}},{"id":"1827eb0b-4f5a-4ef9-8b51-3f3dae7d2f34","block_type":"box","text":"Pay outcomes that are consistent with the returns to investors over the relevant time period.","page_number":190,"box":{"x":102,"y":127,"width":658,"height":11}},{"id":"3787abcd-f901-4c15-8ce2-53bef87bac18","block_type":"box","text":"•","page_number":190,"box":{"x":69,"y":147,"width":6,"height":4}},{"id":"be361d0b-35b5-4fa5-be74-4b6e73b0631d","block_type":"box","text":"Board discretion, if allowed within the variable pay arrangements, to be used sparingly, responsibly and","page_number":190,"box":{"x":102,"y":144,"width":735,"height":11}},{"id":"826a6080-907d-4a9b-970c-d8598cbac879","block_type":"box","text":"transparently.","page_number":190,"box":{"x":101,"y":159,"width":95,"height":11}},{"id":"10e50b01-dea7-46dc-bdf8-69fd7786a239","block_type":"box","text":"•","page_number":190,"box":{"x":69,"y":179,"width":6,"height":5}},{"id":"3323e85d-4d2c-44c0-9af0-2865a90a8111","block_type":"box","text":"A requirement, that participants in long-term share-based incentive plans build a meaningful shareholding in the","page_number":190,"box":{"x":101,"y":176,"width":798,"height":11}},{"id":"9e23dbd1-4908-479d-a9aa-a090851ef3ff","block_type":"box","text":"company within a defined time period, as determined by the board or relevant board committee.","page_number":190,"box":{"x":101,"y":191,"width":683,"height":11}},{"id":"4a20fa65-de04-4ea7-b0f8-10d63b6f3e66","block_type":"box","text":"•","page_number":190,"box":{"x":69,"y":211,"width":6,"height":5}},{"id":"1507974d-4b34-4c55-9628-140422a7b91d","block_type":"box","text":"Change of control provisions that appropriately balance the interests of executives and shareholders.","page_number":190,"box":{"x":102,"y":208,"width":720,"height":12}},{"id":"ac32749d-a95e-4174-b467-07a9cd9d8c09","block_type":"box","text":"•","page_number":190,"box":{"x":69,"y":229,"width":6,"height":4}},{"id":"37e3d24f-d3c5-4c45-9470-505704cde001","block_type":"box","text":"Clawback or malus provisions that allow the company to recoup or hold back variable compensation from","page_number":190,"box":{"x":102,"y":226,"width":747,"height":11}},{"id":"808bf40d-8672-4f95-ae7a-9a12cd4d5647","block_type":"box","text":"individuals whose awards were based on fraudulent activities, misstated financial reports, or executive","page_number":190,"box":{"x":102,"y":241,"width":733,"height":11}},{"id":"304ca221-b9bc-4172-a89d-c5411c3bd6ae","block_type":"box","text":"misconduct.","page_number":190,"box":{"x":102,"y":256,"width":84,"height":8}},{"id":"a9369fce-a1f2-4117-9d1a-31873f86fe89","block_type":"box","text":"•","page_number":190,"box":{"x":69,"y":276,"width":6,"height":4}},{"id":"5765afba-ac6e-425b-87b7-47932b62ed5f","block_type":"box","text":"Severance arrangements that protect the company’s interests but do not cost more than is contractual.","page_number":190,"box":{"x":102,"y":273,"width":738,"height":11}},{"id":"6895e095-b181-44d2-988c-4040d0d075bc","block_type":"box","text":"We may vote against proposals to introduce new share-based incentives, approve existing policies or plans, or","page_number":190,"box":{"x":101,"y":292,"width":787,"height":11}},{"id":"38d7d11d-fd99-4dfa-87a5-3f9d0d71d235","block_type":"box","text":"approve the compensation report where we do not see alignment between executive compensation arrangements","page_number":190,"box":{"x":69,"y":307,"width":810,"height":11}},{"id":"7d06e932-6d3f-4715-83c1-fb0917c405b0","block_type":"box","text":"and our clients’ financial interests. When there is not an alternative, or where there have been multi-year issues with","page_number":190,"box":{"x":69,"y":321,"width":831,"height":11}},{"id":"39edff46-a0df-4ca7-8f66-9e334b591ca9","block_type":"box","text":"compensation misaligned with performance, we may vote against the election of the chair of the responsible","page_number":190,"box":{"x":69,"y":336,"width":775,"height":11}},{"id":"c652fc24-7f64-4b9e-bc11-2ff7f4c5c9b7","block_type":"box","text":"committee, or the most senior independent director.","page_number":190,"box":{"x":69,"y":351,"width":371,"height":11}},{"id":"c4c8199e-68de-49ba-bf7b-5e93bb20b37a","block_type":"box","text":"NON-EXECUTIVE DIRECTOR COMPENSATION","page_number":190,"box":{"x":326,"y":381,"width":325,"height":9}},{"id":"2bebcdbe-f087-42f2-9e06-546fac67ba54","block_type":"box","text":"Companies generally pay non-executive directors an annual retainer or fee in cash, shares or a combination of","page_number":190,"box":{"x":102,"y":400,"width":785,"height":11}},{"id":"866de8f8-2e05-4810-aab3-209a7cb18def","block_type":"box","text":"the two. Some companies also pay additional fees for service on board committees or in board leadership roles. We","page_number":190,"box":{"x":68,"y":415,"width":831,"height":11}},{"id":"6d01894c-3125-4644-b2f5-66029cee8dd5","block_type":"box","text":"do not support non-executive directors participating in performance-based incentive plans as doing so may create a","page_number":190,"box":{"x":69,"y":430,"width":825,"height":11}},{"id":"a441af48-776c-4e84-aec0-359d8a48f11d","block_type":"box","text":"conflict of interest and undermine their independence from management, whom they oversee.","page_number":190,"box":{"x":69,"y":444,"width":668,"height":12}},{"id":"11c39a53-85e4-4d06-8f58-aece467aecd5","block_type":"box","text":"CAPITAL STRUCTURE","page_number":190,"box":{"x":411,"y":475,"width":156,"height":8}},{"id":"4dd6594e-dbbc-4c8b-a0cb-b7442db7d3fa","block_type":"box","text":"Boards are responsible for ensuring senior executive leadership has established a capital strategy that achieves","page_number":190,"box":{"x":102,"y":493,"width":800,"height":12}},{"id":"3afe4a2b-bbc5-40cc-b492-44f3c185d4c7","block_type":"box","text":"appropriate capital allocation in support of long-term financial resilience.","page_number":190,"box":{"x":69,"y":508,"width":516,"height":11}},{"id":"f67ea22a-348a-46c4-9e73-a07933cd7cad","block_type":"box","text":"Where company practices diverge from those set out below, we look for companies to disclose why they view","page_number":190,"box":{"x":101,"y":527,"width":776,"height":11}},{"id":"621f2a4e-8d71-43c4-8159-bbfde02a454e","block_type":"box","text":"these practices to be aligned with shareholders’ interests. We may vote against management proposals seeking","page_number":190,"box":{"x":68,"y":542,"width":803,"height":11}},{"id":"a2b3a291-25ce-45de-80ea-7966ae512a04","block_type":"box","text":"capital-related authorities, or the election of the most senior independent director, if we have concerns about a","page_number":190,"box":{"x":69,"y":557,"width":790,"height":11}},{"id":"e5a3d010-e78a-481e-bf1d-8011bedb5b79","block_type":"box","text":"company’s approach. We may also support a shareholder proposal seeking conversion of shares with differentiated","page_number":190,"box":{"x":69,"y":571,"width":825,"height":12}},{"id":"fbab3dea-7143-4a8e-afec-a34b1c60fd23","block_type":"box","text":"voting rights to a one-share, one-vote standard.","page_number":190,"box":{"x":68,"y":587,"width":336,"height":11}},{"id":"437f3dea-4f2c-4ae1-8c8b-a5a0023dd47d","block_type":"box","text":"Share issuance","page_number":190,"box":{"x":68,"y":609,"width":111,"height":9}},{"id":"f4fefa5d-d2bc-4136-a312-a46524ad20c0","block_type":"box","text":"We assess requests for share issuance for particular transactions on a case-by-case basis. We will generally","page_number":190,"box":{"x":101,"y":627,"width":776,"height":12}},{"id":"c68ee395-1c15-4a72-89c3-34502bcfe392","block_type":"box","text":"support authorities to issue shares when subject to pre-emptive rights, and up to 20% absent pre-emptive rights. We","page_number":190,"box":{"x":69,"y":642,"width":832,"height":12}},{"id":"f1391d9f-0bc3-4bd2-ae93-e95fba33f4ad","block_type":"box","text":"consider it good practice for companies to seek regular approval of these authorities to allow shareholders to take","page_number":190,"box":{"x":69,"y":657,"width":815,"height":11}},{"id":"081e2af4-175f-4f0e-88f8-ad69b520fa73","block_type":"box","text":"into consideration how prior authorities were used, as well as the current circumstances of the company and the","page_number":190,"box":{"x":70,"y":672,"width":802,"height":11}},{"id":"493c404f-6995-4dd6-ad34-5a28de56ac91","block_type":"box","text":"market environment.","page_number":190,"box":{"x":69,"y":687,"width":145,"height":9}},{"id":"bf000300-391a-41aa-9476-e18e584532d8","block_type":"box","text":"Share buybacks","page_number":190,"box":{"x":68,"y":709,"width":116,"height":11}},{"id":"cfc45770-8f9f-4e84-b7d4-0194a1cbc5c8","block_type":"box","text":"We assess share buyback proposals in the context of the company’s disclosed capital management strategy and","page_number":190,"box":{"x":101,"y":728,"width":806,"height":11}},{"id":"4df0c249-c57d-473b-9035-aa5b3ce140fb","block_type":"box","text":"management’s determination of the appropriate balance between investment that supports the long-term growth of","page_number":190,"box":{"x":69,"y":743,"width":823,"height":11}},{"id":"46d0267d-101e-42a9-a914-db5f93af0316","block_type":"box","text":"the company and returning cash to investors. We also take into consideration the effect of a buyback program on the","page_number":190,"box":{"x":68,"y":758,"width":836,"height":11}},{"id":"b96e76ca-9cb3-44dd-a51b-5bab5e400fd3","block_type":"box","text":"company’s balance sheet and executive compensation arrangements and the price at which shares are repurchased","page_number":190,"box":{"x":69,"y":773,"width":830,"height":11}},{"id":"a50fde4c-b27c-4ca0-8a2c-164a690e8a19","block_type":"box","text":"relative to market price. We consider it good practice for companies to seek regular approval of these authorities to","page_number":190,"box":{"x":69,"y":787,"width":822,"height":12}},{"id":"1678e09d-360f-4571-b7ee-7b21cfed180e","block_type":"box","text":"allow shareholders to take into consideration how prior authorities were used, as well as the current circumstances","page_number":190,"box":{"x":69,"y":802,"width":823,"height":11}},{"id":"cbb9056b-32e7-47fa-8395-90f8144daf1b","block_type":"box","text":"of the company and the market environment.","page_number":190,"box":{"x":69,"y":817,"width":319,"height":11}},{"id":"a70c661e-29ff-4a53-b5da-ee42f51add76","block_type":"box","text":"Dividends","page_number":190,"box":{"x":69,"y":840,"width":69,"height":8}},{"id":"359c1b36-4db7-431f-b9e6-e647972e257f","block_type":"box","text":"We generally defer to management and the board on dividend policy but may engage to seek further clarification","page_number":190,"box":{"x":101,"y":858,"width":799,"height":11}},{"id":"a1515f13-bd9c-4b37-8834-dd72422a88d5","block_type":"box","text":"where a proposed dividend appears out of line with the company’s financial position.","page_number":190,"box":{"x":68,"y":873,"width":604,"height":11}},{"id":"b8482733-df19-46b3-a464-6da1f875d818","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":190,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"df19dd5c-b24c-41bf-b851-2b7ebcab7cb9","block_type":"box","text":"Global Engagement and Voting Guidelines | 9","page_number":190,"box":{"x":590,"y":942,"width":319,"height":13}},{"id":"7bea4588-820a-4c7b-9151-8a371035f080","block_type":"box","text":"NM0926U-5977317-190/232","page_number":190,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"74a94e2e-eb08-4f5e-b08d-97416451dbd1","block_type":"box","text":"Differentiated voting rights","page_number":191,"box":{"x":69,"y":45,"width":196,"height":11}},{"id":"5c0bca34-fb92-43f7-84be-15458e72651f","block_type":"box","text":"We prefer companies to adopt a one-share, one-vote structure for share classes with the same economic","page_number":191,"box":{"x":101,"y":63,"width":750,"height":11}},{"id":"ec9b3d85-fae1-4dfe-85c2-ea51cb9e2e31","block_type":"box","text":"exposure. Certain companies, particularly those new to public markets, could make the case to adopt a","page_number":191,"box":{"x":69,"y":78,"width":740,"height":11}},{"id":"824ab5a9-12ab-4c5d-9ea7-e845b5f204f0","block_type":"box","text":"differentiated voting rights structure, or dual class stock. In those situations, we encourage companies to evaluate","page_number":191,"box":{"x":69,"y":93,"width":819,"height":11}},{"id":"0947460c-bbd0-4174-828c-4b6ac3ef9c01","block_type":"box","text":"and seek approval for their capital structure on a periodic basis.","page_number":191,"box":{"x":69,"y":108,"width":456,"height":11}},{"id":"4177abc5-9476-4efb-a760-0db9ead8c037","block_type":"box","text":"TRANSACTIONS AND SPECIAL SITUATIONS","page_number":191,"box":{"x":332,"y":138,"width":314,"height":9}},{"id":"c535914f-5fee-4084-b106-0a99c6b2cb99","block_type":"box","text":"We monitor developments in transactions and special situations closely and undertake our own detailed","page_number":191,"box":{"x":101,"y":157,"width":743,"height":11}},{"id":"9666f19f-d4a1-4a8d-9193-3a59aae90cbb","block_type":"box","text":"analyses of proposals.","page_number":191,"box":{"x":69,"y":172,"width":159,"height":11}},{"id":"342799ca-24bc-4515-a6b2-f2e08e618310","block_type":"box","text":"Mergers and acquisitions","page_number":191,"box":{"x":69,"y":194,"width":184,"height":11}},{"id":"8d046029-f16d-458a-8afc-8bb6c41cf4dd","block_type":"box","text":"We evaluate proposed mergers or acquisitions by assessing the financial outcome for our clients as minority","page_number":191,"box":{"x":101,"y":213,"width":775,"height":11}},{"id":"4fede0d4-b424-4d05-ae4e-0296ca9138b2","block_type":"box","text":"shareholders. Management should provide an assessment of the proposed transaction’s strategic and financial","page_number":191,"box":{"x":69,"y":228,"width":797,"height":11}},{"id":"ee182d81-7e9d-4729-8bfd-f51ae00ea71b","block_type":"box","text":"rationale, along with its execution and operational risks. We review each transaction independently based on these","page_number":191,"box":{"x":69,"y":243,"width":819,"height":11}},{"id":"5bf3a0e2-75e4-45ba-b0a4-d58ef3fe9f78","block_type":"box","text":"factors and the degree to which the transaction enhances shareholder value. The board might consider establishing","page_number":191,"box":{"x":68,"y":257,"width":827,"height":12}},{"id":"99ac296b-44c3-495b-949d-ddd3deecc682","block_type":"box","text":"an ad hoc transaction committee to undertake an independent assessment of a significant merger or acquisition, in","page_number":191,"box":{"x":69,"y":272,"width":827,"height":11}},{"id":"f85e8073-c4e9-41f6-8921-f6e2c18b45a6","block_type":"box","text":"advance of making its recommendation to shareholders.","page_number":191,"box":{"x":69,"y":287,"width":400,"height":11}},{"id":"e097ac05-e201-4d48-8ef3-5db033c34f30","block_type":"box","text":"We will vote against transactions that, in our assessment, do not advance our clients’ financial interests.","page_number":191,"box":{"x":101,"y":306,"width":749,"height":11}},{"id":"c5eeda71-7236-4a91-9f83-ceb1eaee7bf4","block_type":"box","text":"Anti-takeover defenses","page_number":191,"box":{"x":68,"y":328,"width":167,"height":9}},{"id":"7a17725b-7728-42ad-b3e5-52bd6b9978a1","block_type":"box","text":"In principle, we do not support companies using anti-takeover defenses, also known as poison pills or","page_number":191,"box":{"x":102,"y":347,"width":727,"height":11}},{"id":"4132e6b0-b523-429a-875d-02a7f310150a","block_type":"box","text":"shareholder rights plans, as they can entrench management and boards which have not delivered long-term","page_number":191,"box":{"x":69,"y":362,"width":766,"height":11}},{"id":"976a72ff-eee1-49c2-b333-bb35982f5610","block_type":"box","text":"shareholder value. By exception, a poison pill may be supported if its purpose is to delay a takeover that is","page_number":191,"box":{"x":69,"y":376,"width":763,"height":12}},{"id":"32ed0c9b-c4df-4b01-932b-41f3cbfde718","block_type":"box","text":"considered sub-optimal and enable management to seek an improved offer. Similarly, management could make the","page_number":191,"box":{"x":69,"y":391,"width":821,"height":12}},{"id":"cac8215b-d02a-473e-adf7-3c6342545f08","block_type":"box","text":"case to use a poison pill to block a shareholder activism campaign that may be counter to the interests of other","page_number":191,"box":{"x":69,"y":406,"width":799,"height":11}},{"id":"a956b362-3746-4eac-bff5-c32a2de14fa8","block_type":"box","text":"investors. Defense mechanisms introduced in these circumstances should be limited in term and threshold, and also","page_number":191,"box":{"x":70,"y":421,"width":836,"height":11}},{"id":"f893c63a-3e89-4864-8598-2952395577e2","block_type":"box","text":"be closely monitored by the independent members of the board. We consider it good practice for companies to put to","page_number":191,"box":{"x":69,"y":436,"width":835,"height":11}},{"id":"5a98b632-45f8-4083-9dac-1dbb5a62cf7d","block_type":"box","text":"a shareholder vote any mechanisms expected to be in place for more than 12 months.","page_number":191,"box":{"x":69,"y":451,"width":616,"height":11}},{"id":"2ca8498f-b1e9-4907-ad59-663934da9932","block_type":"box","text":"Shareholder activism","page_number":191,"box":{"x":68,"y":473,"width":153,"height":9}},{"id":"43dd8a9e-f434-4d3d-97fd-108f78b97004","block_type":"box","text":"When companies are the focus of an activism campaign, we may communicate with the activist to understand","page_number":191,"box":{"x":101,"y":492,"width":783,"height":11}},{"id":"2332b774-051e-4132-98b8-c2ad415bf8ae","block_type":"box","text":"their analysis and objectives, once they have publicly disclosed their campaign. We may also engage with company","page_number":191,"box":{"x":68,"y":507,"width":819,"height":11}},{"id":"ab366bf6-38a1-48c9-a0ab-6ad494c0eeaf","block_type":"box","text":"management and possibly board members, especially those the activist may be seeking to replace. In our","page_number":191,"box":{"x":69,"y":522,"width":755,"height":11}},{"id":"72bec18c-7ae1-4e46-8dab-206013a20fbd","block_type":"box","text":"assessment, we evaluate various factors, including the concerns raised by the activist and the case for change; the","page_number":191,"box":{"x":69,"y":536,"width":824,"height":12}},{"id":"d413c686-c4b7-4989-9611-cf9e7188c77c","block_type":"box","text":"quality of both the activist’s and management’s plans; and the qualifications of each party’s candidates. We evaluate","page_number":191,"box":{"x":69,"y":551,"width":839,"height":12}},{"id":"f9e72e99-3c15-45e3-8f8a-1b8ba96868b8","block_type":"box","text":"each contested situation by assessing the potential financial outcome for our clients as minority shareholders.","page_number":191,"box":{"x":69,"y":566,"width":788,"height":11}},{"id":"978fbe09-a0be-4532-bbc7-2260436c62c4","block_type":"box","text":"We may support board candidates nominated by a shareholder activist if BAIS, in its independent judgment, or","page_number":191,"box":{"x":101,"y":585,"width":789,"height":11}},{"id":"cd7da69f-1958-42f4-873e-8aeebb271269","block_type":"box","text":"the relevant portfolio manager has determined that there is a case for change to enhance shareholder value, or if the","page_number":191,"box":{"x":68,"y":600,"width":839,"height":11}},{"id":"ed9e5608-e3cc-454d-825b-2844e03e07b6","block_type":"box","text":"incumbent board members do not demonstrate the relevant skills and expertise or have a poor track record of","page_number":191,"box":{"x":70,"y":614,"width":786,"height":11}},{"id":"7804f21b-9ddc-4957-8079-94852a2c504a","block_type":"box","text":"protecting shareholders’ interests.","page_number":191,"box":{"x":70,"y":630,"width":244,"height":11}},{"id":"c460a2e0-069a-4488-bcb9-5cc50c2551eb","block_type":"box","text":"Significant shareholders and related party transactions","page_number":191,"box":{"x":68,"y":652,"width":403,"height":11}},{"id":"dc4a5d69-a21a-4ea4-9bce-82422af7a6fd","block_type":"box","text":"Boards of companies with affiliated shareholders or directors should give equitable consideration to the","page_number":191,"box":{"x":102,"y":670,"width":740,"height":12}},{"id":"91441655-29ac-4433-8759-d749482dec1e","block_type":"box","text":"interests of all shareholders when evaluating related party transactions.","page_number":191,"box":{"x":70,"y":685,"width":511,"height":12}},{"id":"46d2ee2f-2f1c-42ff-a6ca-fbeca135466b","block_type":"box","text":"We consider it good practice for transactions with related parties, such as significant shareholders or companies","page_number":191,"box":{"x":101,"y":704,"width":805,"height":11}},{"id":"688ebdab-c7cc-4837-9c06-1770b7057f48","block_type":"box","text":"affiliated with the public company, to be disclosed in detail and conducted on terms similar to what would objectively","page_number":191,"box":{"x":69,"y":719,"width":832,"height":11}},{"id":"dd8f651b-0f58-416c-b32f-0f9ac3583c79","block_type":"box","text":"have been agreed with a non-related party. In our view, such transactions should be reviewed and approved by the","page_number":191,"box":{"x":69,"y":734,"width":812,"height":11}},{"id":"79e8e23d-bd65-4611-b387-faadf629ec07","block_type":"box","text":"independent members of the board, and if voted on, only disinterested shareholders should vote.","page_number":191,"box":{"x":70,"y":748,"width":692,"height":12}},{"id":"b2ef0897-6d6e-4a34-b8c0-ddfab2f83a46","block_type":"box","text":"CORPORATE REPORTING, RISK MANAGEMENT AND AUDIT","page_number":191,"box":{"x":274,"y":779,"width":430,"height":10}},{"id":"74b54437-580e-4003-8bc4-b1241e2de8aa","block_type":"box","text":"Investors depend on corporate reporting, both regulatory and voluntary, to understand a company’s strategy, its","page_number":191,"box":{"x":102,"y":798,"width":796,"height":11}},{"id":"4e13b4ba-7c04-4ae4-890c-a6ae5fa32bd0","block_type":"box","text":"implementation and financial performance, as well as to assess the quality of management and operations and","page_number":191,"box":{"x":70,"y":812,"width":795,"height":12}},{"id":"b210b4f6-c23f-4c03-9fc9-9c8924296913","block_type":"box","text":"potential for the company to create shareholder value over time. We consider it good practice for the board to","page_number":191,"box":{"x":70,"y":827,"width":779,"height":11}},{"id":"277c5f72-94a9-4c3c-80ff-5f0b8a87ee36","block_type":"box","text":"oversee corporate reporting and the policies and procedures underpinning the internal audit function and external","page_number":191,"box":{"x":69,"y":842,"width":809,"height":11}},{"id":"482b7869-142c-4efa-a377-782e2adcf888","block_type":"box","text":"audit.","page_number":191,"box":{"x":69,"y":857,"width":38,"height":9}},{"id":"1807ed94-7e42-42f3-b6b4-cc211d80bf4d","block_type":"box","text":"A company’s financial reporting should provide decision-useful information for investors, and other stakeholders,","page_number":191,"box":{"x":101,"y":875,"width":803,"height":12}},{"id":"d71bc94b-14ad-4ff0-a23e-d0d7afcbf7e8","block_type":"box","text":"on its financial performance and position. It should provide an accurate and balanced assessment of the risks and","page_number":191,"box":{"x":69,"y":890,"width":819,"height":11}},{"id":"2dcc4c0a-414d-43cd-835d-aa4c619610a7","block_type":"box","text":"opportunities the company faces in realizing its long-term strategy. Accordingly, the assumptions made by","page_number":191,"box":{"x":69,"y":905,"width":752,"height":12}},{"id":"746678db-235f-4b2d-b4cb-12df9d2564a8","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":191,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"2775d545-308b-4aa8-a64f-33b5d58a8b53","block_type":"box","text":"Global Engagement and Voting Guidelines | 10","page_number":191,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"6ced45db-ede3-4f9d-9a88-819c57dc505e","block_type":"box","text":"NM0926U-5977317-191/232","page_number":191,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"d82bde1c-4476-46e0-b3af-f6b6a60ee706","block_type":"box","text":"management and reviewed by the auditor in preparing the financial statements should be reasonable and justified.","page_number":192,"box":{"x":69,"y":45,"width":817,"height":11}},{"id":"c47361e9-2e8f-4dc1-bf65-67fab7c443af","block_type":"box","text":"Financial statements should be prepared in accordance with globally developed reporting standards and any","page_number":192,"box":{"x":70,"y":60,"width":771,"height":11}},{"id":"88ca81b9-b8e9-44eb-8f82-aebfbc64a9cd","block_type":"box","text":"divergence from generally accepted accounting principles should be explained in detail and justified. Accounting","page_number":192,"box":{"x":69,"y":74,"width":796,"height":12}},{"id":"be4a5006-b2ff-4f5d-b121-761144a6cf1a","block_type":"box","text":"restatements should be explained in detail and any remedial actions, and the implications of these, disclosed.","page_number":192,"box":{"x":69,"y":89,"width":788,"height":11}},{"id":"9fb30601-2e61-4d52-b907-de31b70794cd","block_type":"box","text":"In this context, audit committees play a vital role in a company’s financial reporting system by providing","page_number":192,"box":{"x":102,"y":108,"width":739,"height":11}},{"id":"c5bff793-60e3-44e8-8f36-a39b5d951420","block_type":"box","text":"independent oversight of the accounts, material financial and, where appropriate to the jurisdiction, non-financial","page_number":192,"box":{"x":70,"y":123,"width":801,"height":11}},{"id":"a5126e33-7112-464c-be0b-535d4209150f","block_type":"box","text":"information, internal control frameworks and Enterprise Risk Management systems. In our view, effective audit","page_number":192,"box":{"x":70,"y":138,"width":787,"height":11}},{"id":"f906cf3c-8d88-4e0e-bd0c-e735dbaf23ac","block_type":"box","text":"committee oversight strengthens the quality and reliability of a company’s financial statements and provides an","page_number":192,"box":{"x":69,"y":152,"width":795,"height":12}},{"id":"266b449e-a286-4a92-aae6-a32c856ec10a","block_type":"box","text":"important level of reassurance to shareholders. Audit committees should have a procedure in place for assessing the","page_number":192,"box":{"x":70,"y":167,"width":838,"height":12}},{"id":"1c81c456-830e-4daf-ab94-b21e68aba9af","block_type":"box","text":"independence of the auditor and the quality of the external audit process annually.","page_number":192,"box":{"x":70,"y":182,"width":585,"height":11}},{"id":"4b87034a-2050-4f5b-8afa-6dc49f8811cd","block_type":"box","text":"Similarly, we encourage companies to disclose material sustainability-related factors that are integral to how a","page_number":192,"box":{"x":102,"y":201,"width":784,"height":11}},{"id":"fb66e2f3-cb6a-463f-b680-821ca186ec7f","block_type":"box","text":"company manages risks or generates revenue. BAIS finds it helpful to our understanding when companies provide","page_number":192,"box":{"x":69,"y":216,"width":812,"height":11}},{"id":"823cecbe-8b22-457b-97ca-f115097e4e8f","block_type":"box","text":"robust, standardized disclosures on their material sustainability-related risks and opportunities. The International","page_number":192,"box":{"x":69,"y":231,"width":806,"height":11}},{"id":"6cdf5bdb-3969-40a4-bb6c-a12c4f25c611","block_type":"box","text":"Sustainability Standards Board (ISSB) is one entity working to meet these objectives through its reporting standards,","page_number":192,"box":{"x":69,"y":246,"width":832,"height":11}},{"id":"15f4aaa3-6c5f-4f1a-89eb-1baf981ecc55","block_type":"box","text":"which may be helpful to companies in preparing such reports.","page_number":192,"box":{"x":68,"y":260,"width":440,"height":12}},{"id":"21001a1a-2fee-4d5c-98e7-8741eb2b7e4a","block_type":"box","text":"9","page_number":192,"box":{"x":509,"y":261,"width":5,"height":4}},{"id":"ef70417b-ed18-46af-8457-3e53a1d91bbe","block_type":"box","text":"However, we do not mandate any specific disclosure","page_number":192,"box":{"x":520,"y":260,"width":372,"height":11}},{"id":"5d15d520-f905-499d-967a-4e1d14211061","block_type":"box","text":"framework, and note that companies in certain jurisdictions are subject to mandatory reporting requirements under","page_number":192,"box":{"x":68,"y":275,"width":824,"height":11}},{"id":"ac0edf86-94af-4ea9-bbc6-5f6674ea3590","block_type":"box","text":"standards specified by policy makers.","page_number":192,"box":{"x":69,"y":290,"width":267,"height":11}},{"id":"08bf939f-b7b3-42fe-8053-599cd02cbe1d","block_type":"box","text":"10","page_number":192,"box":{"x":338,"y":290,"width":9,"height":5}},{"id":"f2033b42-5c4e-480f-a4a0-c4843cd3e738","block_type":"box","text":"Companies should establish robust risk management and internal control processes appropriate to the","page_number":192,"box":{"x":102,"y":309,"width":735,"height":11}},{"id":"5c062865-54e4-4761-b9da-c76ee9d9912f","block_type":"box","text":"company’s business, risk tolerance, and regulatory environment. A credible whistleblowing system for employees,","page_number":192,"box":{"x":69,"y":323,"width":810,"height":12}},{"id":"ab462902-f941-4412-a9bd-3beec2511068","block_type":"box","text":"and potentially other stakeholders, can be a useful mechanism for ensuring that senior management and the board","page_number":192,"box":{"x":69,"y":338,"width":822,"height":12}},{"id":"73a0b9a2-c6c1-4e3e-a0a7-63632df87235","block_type":"box","text":"are aware of potential misconduct or breaches in risk management and internal control processes.","page_number":192,"box":{"x":69,"y":353,"width":704,"height":12}},{"id":"cb251ce6-cf75-4ab2-842b-9f472a6cb218","block_type":"box","text":"A comprehensive audit conducted by an independent audit firm contributes to investor confidence in the quality","page_number":192,"box":{"x":101,"y":372,"width":794,"height":11}},{"id":"6a3170fd-5191-46be-a58b-7952135789a4","block_type":"box","text":"of corporate reporting. It is helpful when the audit report gives some insight into the scope and focus of the audit, as","page_number":192,"box":{"x":69,"y":387,"width":836,"height":11}},{"id":"5e8a7114-07b5-44b9-96b8-ad1796fa14b9","block_type":"box","text":"well as any critical audit matters identified and how these were resolved. A comprehensive and effective audit is time","page_number":192,"box":{"x":68,"y":402,"width":838,"height":11}},{"id":"a39dc1fe-ae66-409f-9a26-5607966079d8","block_type":"box","text":"and resource intensive, and the audit fee should be commensurate. Fees paid to the audit firm for non-audit","page_number":192,"box":{"x":69,"y":416,"width":773,"height":11}},{"id":"ec1b326c-aba6-4067-ad67-580ecee1c0df","block_type":"box","text":"consulting should not exceed the audit fee to a degree that may prompt concerns about the independence of the","page_number":192,"box":{"x":69,"y":431,"width":804,"height":12}},{"id":"b0359709-48df-4f63-92f8-c30ccac473bf","block_type":"box","text":"audit. The audit committee should explain its position on auditor tenure and how it confirmed that the auditor","page_number":192,"box":{"x":69,"y":446,"width":780,"height":11}},{"id":"d8f17494-0a56-438a-b62c-103fa13c6fc3","block_type":"box","text":"remained independent.","page_number":192,"box":{"x":69,"y":461,"width":163,"height":11}},{"id":"9f367352-16f2-4ffb-b05a-4ef373918456","block_type":"box","text":"We may vote against the election of the responsible directors if corporate reporting is insufficient or there are","page_number":192,"box":{"x":101,"y":480,"width":783,"height":11}},{"id":"70a0ae03-acea-4acc-86a4-edec523c934d","block_type":"box","text":"material misstatements in financial reports. In markets where relevant, we may vote against a proposal to approve","page_number":192,"box":{"x":69,"y":495,"width":819,"height":11}},{"id":"5b204f96-7048-42ac-8403-2fe0f6fb1ee4","block_type":"box","text":"the financial statements or the discharge of the board when we are concerned about the quality of corporate","page_number":192,"box":{"x":68,"y":509,"width":774,"height":12}},{"id":"c12b01b9-5c04-45cc-8a8c-3343964af5e7","block_type":"box","text":"reporting or the audit. We may vote against proposals to appoint the auditor, ratify the audit report, or approve the","page_number":192,"box":{"x":69,"y":524,"width":816,"height":12}},{"id":"19d69689-343f-4f9d-aa8b-7e7488f0c79e","block_type":"box","text":"audit fee if we are concerned about the auditor’s independence, the quality of the audit, or there are material","page_number":192,"box":{"x":69,"y":539,"width":779,"height":11}},{"id":"d6af8224-dc62-44f9-abc6-f6d76c19a021","block_type":"box","text":"misstatements in financial reports and the board has not established reasonable remediation plans.","page_number":192,"box":{"x":69,"y":554,"width":718,"height":11}},{"id":"2aa1de20-6057-4a19-8f19-77460999aabf","block_type":"box","text":"SHAREHOLDER RIGHTS AND PROTECTIONS","page_number":192,"box":{"x":329,"y":584,"width":319,"height":9}},{"id":"25f3ef04-de9b-49ef-b51c-09df2d692529","block_type":"box","text":"General shareholder meetings","page_number":192,"box":{"x":69,"y":607,"width":217,"height":11}},{"id":"1ba83872-a6d7-41d1-b76b-a4e6629c12ca","block_type":"box","text":"Companies normally have an annual general meeting of shareholders at which routine and non-routine items of","page_number":192,"box":{"x":102,"y":625,"width":792,"height":12}},{"id":"0b25347e-0835-42a5-b38c-ca66ba0f9a57","block_type":"box","text":"business are discussed and voted on by shareholders in attendance or submitting proxy votes. Companies should","page_number":192,"box":{"x":69,"y":640,"width":812,"height":11}},{"id":"40d62f1a-f03f-474d-93e3-b9b5c9f22eee","block_type":"box","text":"disclose materials relevant to the shareholder meeting sufficiently in advance so that shareholders can take them","page_number":192,"box":{"x":69,"y":655,"width":813,"height":11}},{"id":"fb4667c0-01c1-4d9d-ac37-a2740ec51031","block_type":"box","text":"into consideration in their voting decisions. Many companies offer shareholders the option of participating in the","page_number":192,"box":{"x":70,"y":670,"width":801,"height":11}},{"id":"2f844eed-639d-470e-a4c5-1cf87649c6e4","block_type":"box","text":"meeting virtually which, whilst welcome, should not limit the rights of shareholders to participate as they would during","page_number":192,"box":{"x":69,"y":685,"width":841,"height":11}},{"id":"39328beb-a671-46ba-b2dd-ca8271c81a2a","block_type":"box","text":"an in-person meeting.","page_number":192,"box":{"x":69,"y":700,"width":152,"height":11}},{"id":"07eea294-544f-4df9-b702-42e96913a6be","block_type":"box","text":"We may vote against directors when materials related to the business of the shareholder meeting are not","page_number":192,"box":{"x":101,"y":718,"width":752,"height":12}},{"id":"a240e7e3-8921-4cfb-93a0-858e2bef3f5e","block_type":"box","text":"provided in a timely manner or do not provide sufficient information for us to make an informed voting decision. We","page_number":192,"box":{"x":70,"y":733,"width":821,"height":11}},{"id":"24fe347d-009d-4093-a687-9610bc1a7803","block_type":"box","text":"may vote against directors if the format of the shareholder meeting does not accommodate reasonable shareholder","page_number":192,"box":{"x":69,"y":748,"width":825,"height":11}},{"id":"215cf66f-b141-4d1f-9106-347535107931","block_type":"box","text":"participation.","page_number":192,"box":{"x":70,"y":763,"width":91,"height":11}},{"id":"c7fd54ba-28a3-4482-9c6a-d7d5784b837f","block_type":"box","text":"9","page_number":192,"box":{"x":69,"y":793,"width":4,"height":4}},{"id":"f69da2ed-0107-44c1-8065-23bcf6dae087","block_type":"box","text":"The ISSB is an independent standard-setting body within the International Financial Reporting Standards","page_number":192,"box":{"x":93,"y":792,"width":744,"height":11}},{"id":"b9c2421a-5768-4112-8cd7-967747b61e52","block_type":"box","text":"(IFRS) Foundation. Please refer to the IFRS website to learn more about the framework and standards S1","page_number":192,"box":{"x":94,"y":807,"width":748,"height":11}},{"id":"74ea54cc-9230-4f1a-a621-246f8a60296f","block_type":"box","text":"“General Requirements for Disclosure of Sustainability-related Financial Information” and S2 “Climate-related","page_number":192,"box":{"x":94,"y":822,"width":778,"height":12}},{"id":"278c4020-e319-4996-a6b6-a21c58da07c2","block_type":"box","text":"Disclosures.”","page_number":192,"box":{"x":94,"y":838,"width":93,"height":8}},{"id":"feef50a6-46ca-4fa4-a745-9a3ddc472256","block_type":"box","text":"10","page_number":192,"box":{"x":69,"y":856,"width":9,"height":4}},{"id":"b7e1d1d4-c743-4b91-9714-95165cc91c64","block_type":"box","text":"See, for examples, https://www.ifrs.org/news-and-events/news/2025/06/ifrs-foundation-publishes-jurisdictional- profiles\r\nissbstandards/ and https//financeeceropae/capitalmarketsnionandfinancialmarkets/compan","page_number":192,"box":{"x":93,"y":858,"width":810,"height":11}},{"id":"ec403a2b-e696-40a3-9b9e-87043afcc072","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/companyreporting\r\nandaditing/companreporting/corporatesstainabilitreportingen","page_number":192,"box":{"x":94,"y":866,"width":804,"height":12}},{"id":"240cd179-c9e5-4239-9a96-14bba6b26831","block_type":"box","text":"p/ p//p/p\r\nreporting-and-auditing/company-reporting/corporate-sustainability-reporting_en.","page_number":192,"box":{"x":94,"y":876,"width":564,"height":11}},{"id":"235a7e31-6d78-4e8e-ad28-2a3c2af5c92c","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":192,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"ad640aaf-813a-4bb1-8afd-f7ea5b4e85f9","block_type":"box","text":"Global Engagement and Voting Guidelines | 11","page_number":192,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"9e0fbf95-d205-49d7-8972-eb1ef524d32f","block_type":"box","text":"NM0926U-5977317-192/232","page_number":192,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"3e97911b-6b26-47fa-b45c-aac6b00e4c44","block_type":"box","text":"Bylaw amendments","page_number":193,"box":{"x":69,"y":45,"width":141,"height":11}},{"id":"ced58a2a-64ed-4dcc-96b3-22905066fd3e","block_type":"box","text":"We review bylaw amendments proposed by management on a case-by-case basis and will generally support","page_number":193,"box":{"x":101,"y":64,"width":766,"height":11}},{"id":"ac2252ea-a3df-4fdd-a5bc-b4224a1d202b","block_type":"box","text":"those that are aligned with the interests of minority shareholders. Any material changes to the bylaws should be","page_number":193,"box":{"x":68,"y":78,"width":800,"height":11}},{"id":"97b43496-ba8b-4a7a-b4e8-83e4c47caa3e","block_type":"box","text":"explained in detail and put to a shareholder vote.","page_number":193,"box":{"x":69,"y":93,"width":349,"height":11}},{"id":"a2d75481-1b0f-4c6b-8a8c-b74da28f5a75","block_type":"box","text":"We may vote against bylaw amendments that reduce shareholder rights and protections or introduce additional","page_number":193,"box":{"x":101,"y":112,"width":790,"height":11}},{"id":"1aef3f92-aa0e-460f-806f-0c132d616245","block_type":"box","text":"burdens. We may vote against directors if material changes are made to the bylaws without shareholder approval.","page_number":193,"box":{"x":69,"y":126,"width":810,"height":12}},{"id":"b11148fc-4b31-4aaa-9fed-dbfeba1e887e","block_type":"box","text":"If not provided for in the relevant corporate law, company bylaws should allow shareholders, individually or as a","page_number":193,"box":{"x":102,"y":145,"width":790,"height":11}},{"id":"2238bac2-bd16-49c1-9f68-329827f42a91","block_type":"box","text":"group, with a meaningful shareholding, the right to call a special meeting of shareholders. The shareholding required","page_number":193,"box":{"x":68,"y":160,"width":831,"height":11}},{"id":"564a4f46-8bd2-4f54-8203-6705ae3372ab","block_type":"box","text":"to exercise this right should balance its utility with the cost to the company of holding special meetings.","page_number":193,"box":{"x":68,"y":175,"width":740,"height":11}},{"id":"5aa1d44a-d987-431c-b692-1a15808b6b83","block_type":"box","text":"If not provided for in the relevant corporate law, company bylaws should allow shareholders, individually or as a","page_number":193,"box":{"x":102,"y":193,"width":790,"height":12}},{"id":"6d4a2146-15cd-4dc1-96ad-dd87c8217c68","block_type":"box","text":"group, with a meaningful shareholding, the right to nominate directors to the company’s board. The threshold for this","page_number":193,"box":{"x":68,"y":208,"width":834,"height":12}},{"id":"a4f08122-44f7-4b2b-a6c7-a4bfb9406797","block_type":"box","text":"right should be set so that shareholders can exercise it without being unduly disruptive to the board’s own","page_number":193,"box":{"x":69,"y":223,"width":758,"height":12}},{"id":"4215e4d5-e1c5-4d43-8516-112087533035","block_type":"box","text":"nomination process.","page_number":193,"box":{"x":69,"y":238,"width":143,"height":11}},{"id":"d4731a30-d6d3-4b93-a5cb-ca1f6caaebc9","block_type":"box","text":"Whilst we would not use either of these rights ourselves, we see them as important accountability mechanisms.","page_number":193,"box":{"x":101,"y":257,"width":799,"height":11}},{"id":"cf4790eb-c897-47fc-bbbe-1cb066ac83a3","block_type":"box","text":"We may vote for a shareholder proposal seeking the addition of either of these provisions to a company’s bylaws.","page_number":193,"box":{"x":68,"y":272,"width":810,"height":11}},{"id":"c9b83b1c-93d0-4d20-b6a8-932cd0d85ac9","block_type":"box","text":"Change of domicile","page_number":193,"box":{"x":69,"y":294,"width":139,"height":11}},{"id":"79098c70-8ccb-4dcf-966b-f1dfb652ba5a","block_type":"box","text":"We generally defer to management on proposals to change a company’s domicile as long as the rationale for","page_number":193,"box":{"x":101,"y":313,"width":778,"height":11}},{"id":"3d285c0a-8ef4-4ef0-bb94-fb521c49934f","block_type":"box","text":"doing so is consistent with the company’s long-term strategy and business model and the related costs are","page_number":193,"box":{"x":69,"y":328,"width":766,"height":11}},{"id":"ffd91d09-90ef-4fcc-b7a6-c072a95ef7f4","block_type":"box","text":"immaterial.","page_number":193,"box":{"x":70,"y":343,"width":77,"height":8}},{"id":"35f75050-155a-4eaf-af02-f24099d2a816","block_type":"box","text":"We may vote against directors or a proposal to change a company’s domicile where it does not seem aligned","page_number":193,"box":{"x":101,"y":361,"width":777,"height":11}},{"id":"b1a5b2ea-9f6d-4005-af89-4ed79d91168d","block_type":"box","text":"with our clients’ financial interests.","page_number":193,"box":{"x":68,"y":376,"width":249,"height":9}},{"id":"99de9f2d-8a46-4789-8ef2-433432d41f11","block_type":"box","text":"Changes to a company’s purpose or the nature of its business","page_number":193,"box":{"x":69,"y":398,"width":452,"height":11}},{"id":"363273b9-2f15-469f-83a7-1e69f2743b32","block_type":"box","text":"Plans to materially change the nature of a company’s business or its purpose should be disclosed and explained","page_number":193,"box":{"x":102,"y":417,"width":803,"height":11}},{"id":"a24da18d-6ef3-4321-b075-d2fb0fbde302","block_type":"box","text":"in the context of long-term strategy and business dynamics. Such changes may significantly alter an investor’s views","page_number":193,"box":{"x":70,"y":432,"width":829,"height":11}},{"id":"318499d9-6245-441f-8b7a-273bb48759bb","block_type":"box","text":"on the suitability of a company for their investment strategy or portfolio.","page_number":193,"box":{"x":69,"y":447,"width":511,"height":11}},{"id":"c5f706a0-66b6-4cb4-92f7-387102564235","block_type":"box","text":"Where relevant, we may vote against proposals to change a company’s purpose or the nature of its business if","page_number":193,"box":{"x":101,"y":465,"width":792,"height":12}},{"id":"960a59ab-36e2-4252-9361-2bc40e75ee8f","block_type":"box","text":"the board has not provided a credible argument for change.","page_number":193,"box":{"x":68,"y":480,"width":424,"height":12}},{"id":"b95491c9-b706-43c9-99b2-1034734408af","block_type":"box","text":"SHAREHOLDER PROPOSALS","page_number":193,"box":{"x":385,"y":510,"width":207,"height":9}},{"id":"e33c41ed-e7ff-4ea6-9f91-9236018e55f0","block_type":"box","text":"Shareholders in many markets, who meet certain eligibility criteria, have the right to submit proposals to the","page_number":193,"box":{"x":102,"y":529,"width":772,"height":11}},{"id":"af1220c3-b677-4b07-9eb0-b7145008391b","block_type":"box","text":"general shareholder meeting asking a company to take a particular course of action subject to the proposal being","page_number":193,"box":{"x":68,"y":544,"width":811,"height":11}},{"id":"32373b50-9cf3-4ecb-8116-8fc0feb1e3be","block_type":"box","text":"supported by a majority of votes cast at the meeting. The topics raised can address a range of matters that may be","page_number":193,"box":{"x":69,"y":559,"width":824,"height":11}},{"id":"17321c25-d594-4ecc-ae94-3e0f4b7efb47","block_type":"box","text":"relevant to a company’s business.","page_number":193,"box":{"x":69,"y":574,"width":243,"height":11}},{"id":"11412a70-b57b-41ab-b32e-adb0007a740f","block_type":"box","text":"We vote on these proposals on a case-by-case basis. We assess the relevance of the topic raised to a","page_number":193,"box":{"x":101,"y":592,"width":730,"height":11}},{"id":"9720747d-8ae8-414e-8382-04a0f02e17ed","block_type":"box","text":"company’s business and its current approach, whether the actions sought are consistent with shareholders’","page_number":193,"box":{"x":69,"y":607,"width":772,"height":11}},{"id":"dbe2ac5e-c700-44a8-8e52-c8805c3c89ea","block_type":"box","text":"interests, and what impact the proposal being acted upon might have on financial performance.","page_number":193,"box":{"x":70,"y":622,"width":681,"height":11}},{"id":"e4846182-046a-449f-bb7f-21715f8ddcb4","block_type":"box","text":"Our general approach where we have concerns about a company’s governance, disclosures or performance is to","page_number":193,"box":{"x":102,"y":641,"width":801,"height":11}},{"id":"5d96af69-7e3d-4188-ab54-f99685052702","block_type":"box","text":"engage to understand the apparent difference in perspective. If we are concerned a company is not acting in","page_number":193,"box":{"x":69,"y":656,"width":774,"height":11}},{"id":"7c34a937-70e6-4d08-95a8-99455f90d70d","block_type":"box","text":"shareholders’ financial interests, we may vote against the election of directors. We may support a relevant","page_number":193,"box":{"x":69,"y":670,"width":761,"height":12}},{"id":"0056d8e4-8679-44c2-a779-5376f5b73688","block_type":"box","text":"shareholder proposal if doing so is aligned with our clients’ financial interests. We generally do not support","page_number":193,"box":{"x":69,"y":685,"width":764,"height":12}},{"id":"d7894bdc-96c9-4dc0-b7c2-e904f1c67779","block_type":"box","text":"shareholder proposals that are legally binding on the company, seek to alter a company’s strategy or direct its","page_number":193,"box":{"x":69,"y":700,"width":785,"height":11}},{"id":"ff4b9bc5-1f5e-4e2f-ad4d-812dcf3c7e04","block_type":"box","text":"operations, or are unrelated to how a company manages risk or generates financial returns.","page_number":193,"box":{"x":69,"y":715,"width":653,"height":11}},{"id":"8820ac28-12fc-49c3-9a1e-6363bf3ec0c3","block_type":"box","text":"BlackRock is subject to rules, regulations, agency guidance and contractual agreements that place restrictions","page_number":193,"box":{"x":102,"y":734,"width":788,"height":11}},{"id":"8382cb8b-21a7-46e6-b31e-9c5ae115dfe8","block_type":"box","text":"and limitations on how we can interact with the companies in which we invest on behalf of our clients, including our","page_number":193,"box":{"x":69,"y":748,"width":822,"height":12}},{"id":"8e2b66fd-24a8-4054-8102-de0eb0e32f88","block_type":"box","text":"ability to submit shareholder proposals. We do not submit shareholder proposals but can vote, on behalf of clients","page_number":193,"box":{"x":69,"y":763,"width":817,"height":12}},{"id":"b6e94fb5-f031-4cc4-bd51-8359942f7f90","block_type":"box","text":"who authorize us to do so, on proposals put forth by others.","page_number":193,"box":{"x":68,"y":778,"width":428,"height":11}},{"id":"8fa257f6-a0f2-45d4-925b-ef74636a8654","block_type":"box","text":"CORPORATE POLITICAL ACTIVITIES","page_number":193,"box":{"x":359,"y":808,"width":260,"height":9}},{"id":"87743ea5-1a1f-4737-9bb3-98e870e978d6","block_type":"box","text":"A corporation’s ability to engage in the policy process is subject to rules and regulations set by the jurisdictions","page_number":193,"box":{"x":101,"y":827,"width":795,"height":11}},{"id":"76f266b1-c485-4ed2-b59e-6b74cdfc29f7","block_type":"box","text":"in which they engage. When a corporation reports material financial risk related to policy and or regulatory changes,","page_number":193,"box":{"x":70,"y":842,"width":824,"height":11}},{"id":"52ce969a-c813-4464-aa67-a0ad13d63d86","block_type":"box","text":"BAIS may seek to understand how it is addressing the material risk identified. We seek to understand how","page_number":193,"box":{"x":70,"y":857,"width":757,"height":11}},{"id":"4bf9d7c1-e675-46a3-be7f-5b08ac1f0eff","block_type":"box","text":"companies engage in corporate political activities and ensure that their participation is consistent with their public","page_number":193,"box":{"x":69,"y":872,"width":814,"height":11}},{"id":"fda8c241-4b10-47a4-8d32-8da14267cb66","block_type":"box","text":"statements on policy matters material to the company’s long-term strategy. The board should be aware of the","page_number":193,"box":{"x":69,"y":887,"width":780,"height":11}},{"id":"fe596fee-92d0-42a4-90f8-2865f854730b","block_type":"box","text":"approach taken by management on corporate political activities as there can be reputational risks arising from","page_number":193,"box":{"x":69,"y":901,"width":786,"height":12}},{"id":"ee970c32-a964-4384-a7a3-32f1faded2c7","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":193,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"ff10bc28-0e82-4554-8ab7-91ab78f3c28f","block_type":"box","text":"Global Engagement and Voting Guidelines | 12","page_number":193,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"5f67c0d0-d05c-4d13-a23f-19578673f5aa","block_type":"box","text":"NM0926U-5977317-193/232","page_number":193,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"2397beb1-4c97-4725-b529-d5dcf0e16b9a","block_type":"box","text":"inconsistencies between a company’s policy engagement and stated policy positions. Companies should, as a","page_number":194,"box":{"x":70,"y":45,"width":786,"height":11}},{"id":"22953ce7-c1bc-4ba4-a2f1-939b160b31a9","block_type":"box","text":"minimum, meet all regulatory disclosure requirements on political activities. We may engage a company where we","page_number":194,"box":{"x":69,"y":60,"width":812,"height":11}},{"id":"8291ab80-1a2a-4a8d-a186-c4d12b9c625e","block_type":"box","text":"would like to better understand its approach to policy engagement, where relevant.","page_number":194,"box":{"x":68,"y":75,"width":590,"height":11}},{"id":"ef56d4e3-7040-4f49-bcaf-74435af9afdd","block_type":"box","text":"To mitigate the risk of inconsistencies, companies may wish to assess the alignment between their policy","page_number":194,"box":{"x":101,"y":93,"width":753,"height":11}},{"id":"b15ddc67-7819-4633-ade0-29b7ee9165a1","block_type":"box","text":"priorities and the policy positions of the trade associations of which they are active members and any engagements","page_number":194,"box":{"x":70,"y":108,"width":823,"height":11}},{"id":"b1da7e56-2de2-4bab-b104-fe13e3a5a477","block_type":"box","text":"undertaken by trade associations on behalf of members.","page_number":194,"box":{"x":69,"y":123,"width":404,"height":11}},{"id":"39efed97-3d0f-4cd8-90ea-d37068e57977","block_type":"box","text":"We may support a relevant shareholder proposal, or vote against directors, where a company’s disclosures are","page_number":194,"box":{"x":101,"y":142,"width":793,"height":11}},{"id":"5607e6f7-021a-44bd-9c68-4942d5575817","block_type":"box","text":"insufficient to address the material risk it has identified.","page_number":194,"box":{"x":70,"y":156,"width":400,"height":9}},{"id":"fe509206-b7ed-45fe-adbf-3d0630fac7d5","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":194,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"d7550df5-b263-42f5-8ac3-68268db11785","block_type":"box","text":"Global Engagement and Voting Guidelines | 13","page_number":194,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"f11431f8-238b-4c94-b1d0-1bf964c2574d","block_type":"box","text":"NM0926U-5977317-194/232","page_number":194,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"95c63cf4-0dc9-4a04-a426-75d80ef78221","block_type":"box","text":"MATERIAL SUSTAINABILITY- RELATED RISKS AND OPPORTUNITIES","page_number":195,"box":{"x":245,"y":45,"width":489,"height":9}},{"id":"47a8ca38-3dda-4e0c-8d52-6d815823c1ca","block_type":"box","text":"We seek to understand how companies manage the material risks and opportunities inherent in their business","page_number":195,"box":{"x":101,"y":64,"width":790,"height":11}},{"id":"e70198dc-0658-4290-bbf3-a4cbe3cc519e","block_type":"box","text":"operations. In our experience, sustainability-related factors","page_number":195,"box":{"x":69,"y":78,"width":418,"height":12}},{"id":"2f4d7dec-ed35-4faa-9e56-a78bf6cf13b4","block_type":"box","text":"11","page_number":195,"box":{"x":488,"y":79,"width":9,"height":4}},{"id":"b357f3f6-3c1a-4f72-b27d-9ca1e51eb79d","block_type":"box","text":"that are relevant to a company’s business or material to","page_number":195,"box":{"x":502,"y":79,"width":402,"height":11}},{"id":"b2da0baf-00f8-4dfa-b43b-86e12ba24793","block_type":"box","text":"its financial performance, are generally operational considerations embedded into day-to-day management systems.","page_number":195,"box":{"x":70,"y":93,"width":824,"height":12}},{"id":"b8d90c68-9fb1-4b72-b3ce-1f7adcb37f19","block_type":"box","text":"Certain sustainability issues may also inform long-term strategic planning, for example, investing in product","page_number":195,"box":{"x":69,"y":108,"width":766,"height":11}},{"id":"2652f91b-fbdb-4680-85b8-caa37177126c","block_type":"box","text":"innovation in anticipation of changing consumer demand or adapting supply chains in response to changing","page_number":195,"box":{"x":70,"y":123,"width":764,"height":11}},{"id":"d95806a5-b1a8-4524-ba4c-78895452f142","block_type":"box","text":"regulatory requirements.","page_number":195,"box":{"x":69,"y":138,"width":174,"height":11}},{"id":"d088d36e-ac1c-4767-95e1-baecdc03567b","block_type":"box","text":"We recognize that the specific sustainability-related factors that may be financially material or business relevant","page_number":195,"box":{"x":101,"y":156,"width":798,"height":12}},{"id":"167da54f-4eac-49d6-94bc-21609434fb57","block_type":"box","text":"will vary by company business model, sector, key markets, and time horizon, amongst other considerations. From","page_number":195,"box":{"x":68,"y":172,"width":809,"height":11}},{"id":"5be4b5e4-f2e5-44b3-8ea8-f619bf93c48e","block_type":"box","text":"company disclosures and our engagement, we aim to understand how management is identifying, assessing and","page_number":195,"box":{"x":69,"y":186,"width":803,"height":12}},{"id":"06f84d6a-7b28-4f33-9cbd-5bcd555d07ac","block_type":"box","text":"integrating material sustainability-related risks and opportunities into their business decision-making and practices.","page_number":195,"box":{"x":70,"y":201,"width":820,"height":11}},{"id":"ac4b1116-60db-4cea-a2d5-cabf4042fb1a","block_type":"box","text":"Doing so helps us undertake a more holistic assessment of a company’s potential financial performance and the","page_number":195,"box":{"x":70,"y":216,"width":808,"height":11}},{"id":"9a5adb38-8905-46af-9209-2dd23e7c08da","block_type":"box","text":"likely risk-adjusted returns of an investment.","page_number":195,"box":{"x":70,"y":231,"width":313,"height":11}},{"id":"fa5f0d5b-5711-4a66-9464-56a5c713208e","block_type":"box","text":"We may vote against directors or support a relevant shareholder proposal if we have concerns about how a","page_number":195,"box":{"x":101,"y":249,"width":764,"height":12}},{"id":"0c8de0f1-99db-4cd7-98b3-8b435d17194f","block_type":"box","text":"company is managing or disclosing its approach to material sustainability-related risks that may impact financial","page_number":195,"box":{"x":69,"y":264,"width":798,"height":12}},{"id":"9c9e4e32-fe9e-485e-bbe4-9e81bffba824","block_type":"box","text":"returns.","page_number":195,"box":{"x":69,"y":280,"width":54,"height":8}},{"id":"5d19c4d8-f70c-40d9-b66d-a86f3dcf5e80","block_type":"box","text":"KEY STAKEHOLDERS","page_number":195,"box":{"x":414,"y":309,"width":151,"height":9}},{"id":"5f35b1ac-00b5-4c46-8c96-08d7830cc8c3","block_type":"box","text":"In our view, companies should understand and take into consideration the interests of the various parties on","page_number":195,"box":{"x":102,"y":328,"width":774,"height":11}},{"id":"724432b8-6f4e-4743-9ba6-412fbfc5f4e4","block_type":"box","text":"whom they depend for their success over time. It is for each company to determine their key stakeholders based on","page_number":195,"box":{"x":68,"y":343,"width":826,"height":11}},{"id":"c7c26ba5-0f72-43e1-8436-5d218f504f5a","block_type":"box","text":"what is material to their business and long-term financial performance. For many companies, key stakeholders","page_number":195,"box":{"x":68,"y":358,"width":790,"height":11}},{"id":"1c1ca535-705a-499e-b798-482a353aa837","block_type":"box","text":"include employees, business partners (such as suppliers and distributors), clients and consumers, regulators, and","page_number":195,"box":{"x":70,"y":373,"width":817,"height":11}},{"id":"a4eca145-79c3-4038-ae53-6a818a94dc32","block_type":"box","text":"the communities in which they operate. Companies that appropriately balance the interests of investors and other","page_number":195,"box":{"x":68,"y":387,"width":813,"height":12}},{"id":"f2c8224e-8877-4d3d-80fa-9f9ccb79d6bb","block_type":"box","text":"stakeholders are, in our experience, more likely to be financially resilient over time.","page_number":195,"box":{"x":69,"y":402,"width":592,"height":12}},{"id":"f364602b-50bd-4f90-8c93-aa03296dcb45","block_type":"box","text":"CLIMATE AND DECARBONIZATION INVESTMENT OBJECTIVES","page_number":195,"box":{"x":265,"y":432,"width":448,"height":9}},{"id":"b9af7355-88a0-4b26-990a-9cee818bf334","block_type":"box","text":"Certain active BlackRock funds have climate and decarbonization objectives in addition to financial objectives.","page_number":195,"box":{"x":102,"y":451,"width":784,"height":11}},{"id":"215cb9e9-3c67-4439-ac0b-a7b95c21d242","block_type":"box","text":"Consistent with the objectives of those investment strategies, our stewardship activity in relation to the holdings in","page_number":195,"box":{"x":69,"y":466,"width":818,"height":11}},{"id":"071bbf56-1b35-4450-af91-0a53dc9bcef1","block_type":"box","text":"those funds differs in some respects from BAIS’ benchmark guidelines, which are described above. Specifically, for","page_number":195,"box":{"x":68,"y":481,"width":823,"height":11}},{"id":"5ca1c160-52ca-479b-a672-03fd80a2b185","block_type":"box","text":"those funds’ holdings, we look to investee companies to demonstrate that they are aligned with a decarbonization","page_number":195,"box":{"x":68,"y":496,"width":814,"height":11}},{"id":"bb1f5cc5-f313-414d-9abc-71b333b75677","block_type":"box","text":"pathway that means their business model would be viable in a low-carbon economy,","page_number":195,"box":{"x":70,"y":511,"width":594,"height":11}},{"id":"64a88591-5062-4dfb-bba6-c02acecd32da","block_type":"box","text":"i.e.","page_number":195,"box":{"x":672,"y":511,"width":20,"height":9}},{"id":"aa4b97ce-12a1-48ff-8015-bd876f42e445","block_type":"box","text":", one in which global","page_number":195,"box":{"x":694,"y":511,"width":144,"height":11}},{"id":"9a32e1f0-55c1-4c09-b609-10c5e2b667c8","block_type":"box","text":"temperature rise is limited to 1.5°C above pre-industrial levels. In addition, clients in separately managed accounts","page_number":195,"box":{"x":68,"y":526,"width":821,"height":11}},{"id":"93aa1a4d-d3bd-426e-bd58-9c843083c082","block_type":"box","text":"may instruct BlackRock to apply these guidelines to their holdings. Both in the case of funds and separately managed","page_number":195,"box":{"x":69,"y":540,"width":839,"height":12}},{"id":"31a39be2-f0e0-4c2b-8684-45a84893046e","block_type":"box","text":"accounts, these guidelines are only implemented upon explicit selection and approval by the applicable fund board or","page_number":195,"box":{"x":69,"y":555,"width":837,"height":12}},{"id":"afc28005-a106-4e9c-aa86-62b10e36eed6","block_type":"box","text":"client.","page_number":195,"box":{"x":69,"y":570,"width":41,"height":9}},{"id":"2836e1af-f776-45f8-b786-0013da21ff4c","block_type":"box","text":"These decarbonization stewardship guidelines focus on companies which produce goods and services that","page_number":195,"box":{"x":101,"y":589,"width":761,"height":11}},{"id":"c93bb787-244f-4d4c-a42a-ccfa7d8862da","block_type":"box","text":"contribute to real world decarbonization or have a carbon intensive business model and face outsized impacts from","page_number":195,"box":{"x":69,"y":604,"width":821,"height":11}},{"id":"de4ab9dd-bb60-4a68-8b8e-c154e03fe2dd","block_type":"box","text":"the low carbon transition, based on reported and estimated scopes 1, 2, and 3 greenhouse gas emissions. These","page_number":195,"box":{"x":68,"y":619,"width":817,"height":11}},{"id":"2388e5ca-8da5-450f-a20d-34b3ed6c57e1","block_type":"box","text":"companies should provide disclosures that set out their governance, strategy, risk management processes and","page_number":195,"box":{"x":69,"y":634,"width":792,"height":11}},{"id":"e9593a6f-b574-43fb-a2c3-853254b1f79f","block_type":"box","text":"metrics and targets relevant to decarbonization. It is helpful to investors’ understanding when these disclosures","page_number":195,"box":{"x":69,"y":648,"width":799,"height":12}},{"id":"2a111acf-4331-4ce1-8972-99e4dc066594","block_type":"box","text":"include an explanation of the decarbonization scenarios a company is using in its near- and long-term planning, as","page_number":195,"box":{"x":70,"y":663,"width":812,"height":11}},{"id":"4635c99d-771f-4063-9810-7861bf63de2f","block_type":"box","text":"well as its scope 1, scope 2 and material scope 3 greenhouse gas (GHG) emissions and reduction targets for scope","page_number":195,"box":{"x":68,"y":678,"width":831,"height":11}},{"id":"e50d209b-44c2-4cae-9dc6-dd0aadc89a31","block_type":"box","text":"1 and 2 emissions.","page_number":195,"box":{"x":70,"y":693,"width":135,"height":9}},{"id":"22261699-c238-4f73-8cfc-bd2c54865600","block_type":"box","text":"Under these climate- and decarbonization-specific guidelines, BAIS may recommend a vote against directors or","page_number":195,"box":{"x":102,"y":711,"width":788,"height":12}},{"id":"fb604b91-7029-4165-9289-09771279d8d2","block_type":"box","text":"support for a relevant shareholder proposal if a company does not appear to be adequately acting to address or","page_number":195,"box":{"x":69,"y":726,"width":800,"height":12}},{"id":"c16c67ae-a5da-43a0-b1a7-aa7f1ab387ed","block_type":"box","text":"disclosing material climate-related risks, consistent with the parameters set out in these climate-and decarbonization","page_number":195,"box":{"x":69,"y":741,"width":839,"height":12}},{"id":"391b1607-8e76-4c62-867b-b856c082ecfe","block_type":"box","text":"specific guidelines. We may recommend supporting shareholder proposals seeking information relevant to a","page_number":195,"box":{"x":69,"y":756,"width":771,"height":11}},{"id":"1934c7a2-15c2-43c2-b427-41efa12494c4","block_type":"box","text":"11","page_number":195,"box":{"x":69,"y":786,"width":9,"height":4}},{"id":"cf5ce8bd-b15b-4635-a9ea-a38c4328b659","block_type":"box","text":"By material sustainability-related risks and opportunities, we mean the drivers of risk and financial value creation in","page_number":195,"box":{"x":84,"y":785,"width":822,"height":11}},{"id":"d4b73286-8205-4fbd-aac8-4f3cc49e1b83","block_type":"box","text":"a company’s business model that have an environmental or social dependency or impact. Examples of environmental","page_number":195,"box":{"x":69,"y":800,"width":835,"height":12}},{"id":"2f5b7328-adaa-41a9-b4d9-42a0eb7b881e","block_type":"box","text":"issues include, but are not limited to, water use, land use, waste management, and climate risk. Examples of social","page_number":195,"box":{"x":70,"y":816,"width":827,"height":11}},{"id":"428effd1-ad5b-45be-9c06-44d89172e0d9","block_type":"box","text":"issues include, but are not limited to, human capital management, impacts on the communities in which a company","page_number":195,"box":{"x":70,"y":831,"width":826,"height":11}},{"id":"1ea03846-230c-41c4-a380-ba714308e777","block_type":"box","text":"operates, customer loyalty, and relationships with regulators. It is our view that well-managed companies will","page_number":195,"box":{"x":69,"y":846,"width":773,"height":11}},{"id":"b88bffe4-62a6-4d36-84ac-b60630d6cb3c","block_type":"box","text":"effectively evaluate and manage material sustainability-related risks and opportunities relevant to their businesses.","page_number":195,"box":{"x":69,"y":861,"width":823,"height":11}},{"id":"c82a6f1e-4280-4b78-801c-9cc5abffec5a","block_type":"box","text":"Governance is the core means by which boards can oversee the creation of durable financial value over time.","page_number":195,"box":{"x":69,"y":876,"width":777,"height":11}},{"id":"085230a3-13bc-4ef7-bb57-e7c050b8c498","block_type":"box","text":"Appropriate risk oversight of business-relevant and material sustainability-related considerations is a component of a","page_number":195,"box":{"x":68,"y":891,"width":833,"height":11}},{"id":"bb4837df-3995-4037-81d5-732d42656754","block_type":"box","text":"sound governance framework.","page_number":195,"box":{"x":69,"y":906,"width":212,"height":12}},{"id":"1eb9d2a5-4d9a-43e8-84fc-1f6b66fbe061","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":195,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"3dfdb4ce-39dc-489c-9784-afd4518a9830","block_type":"box","text":"Global Engagement and Voting Guidelines | 14","page_number":195,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"4b0b15f2-64a8-4b53-af99-d736146d150a","block_type":"box","text":"NM0926U-5977317-195/232","page_number":195,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"4b1bb3f6-5e7a-4a28-a85d-707cf22078b2","block_type":"box","text":"company’s stated low-carbon transition strategy or targets that the company does not currently provide and that","page_number":196,"box":{"x":69,"y":45,"width":798,"height":11}},{"id":"7aa00f42-845e-49f4-a633-e50c38c61a07","block_type":"box","text":"would be helpful to investment decision-making. We would not recommend support for shareholder proposals that","page_number":196,"box":{"x":68,"y":59,"width":814,"height":12}},{"id":"c1c5dcf5-ba86-4272-af98-377ffe5f58c3","block_type":"box","text":"seek to constrain board or management decision-making or direct specific business or strategic decisions. As under","page_number":196,"box":{"x":69,"y":74,"width":828,"height":12}},{"id":"e839ee57-a255-4d90-bb85-e0cc84a8a31f","block_type":"box","text":"the BAIS benchmark approach, the active portfolio managers are ultimately responsible for voting consistent with","page_number":196,"box":{"x":68,"y":89,"width":807,"height":12}},{"id":"11094d33-fbf8-435a-b140-af044ade1c41","block_type":"box","text":"their investment mandate and fund objectives. For the funds and accounts in scope, voting on matters not related to","page_number":196,"box":{"x":68,"y":104,"width":832,"height":11}},{"id":"35faa912-6d1a-4a7a-b711-a0414f45f937","block_type":"box","text":"climate risk and the energy transition is undertaken in line with BAIS’ benchmark guidelines.","page_number":196,"box":{"x":69,"y":119,"width":658,"height":11}},{"id":"980c8f0a-177c-4c98-ba3e-6e6e00e17c9a","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":196,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"d8a2af01-5d79-4824-8e5c-bf8a8e88fbba","block_type":"box","text":"Global Engagement and Voting Guidelines | 15","page_number":196,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"ac52ebbb-c902-4b77-9a2f-51b685576302","block_type":"box","text":"NM0926U-5977317-196/232","page_number":196,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"a72d21b3-5d15-417f-b8e0-143cc230d29d","block_type":"box","text":"APPENDIX 1: HOW WE FULFILL AND OVERSEE OUR INVESTMENT STEWARDSHIP RESPONSIBILITIES FOR NON","page_number":197,"box":{"x":83,"y":45,"width":812,"height":9}},{"id":"eaff4ac0-2f88-4af0-b936-df9ce63f050e","block_type":"box","text":"INDEX EQUITY INVESTMENT STRATEGIES","page_number":197,"box":{"x":338,"y":60,"width":302,"height":10}},{"id":"aa07d23f-23c3-452a-a6ef-36507324b39b","block_type":"box","text":"Oversight","page_number":197,"box":{"x":69,"y":83,"width":68,"height":11}},{"id":"2a7f12f9-591f-44de-a01f-e6cc0a3d68f9","block_type":"box","text":"The Global Head of BAIS has primary oversight of and responsibility for the team’s activities, including voting in","page_number":197,"box":{"x":101,"y":101,"width":793,"height":11}},{"id":"e20ba31d-2fcc-43e1-95d2-36fd75d5cfd7","block_type":"box","text":"accordance with the BlackRock Active Investment Stewardship Global Engagement and Voting Guidelines (the","page_number":197,"box":{"x":69,"y":116,"width":778,"height":11}},{"id":"ed58f173-ec9a-4f80-80bf-59213dd8e33c","block_type":"box","text":"“Guidelines”), which require the application of professional judgment and consideration of each company’s unique","page_number":197,"box":{"x":70,"y":131,"width":814,"height":11}},{"id":"59dd8d3c-dbc3-40ef-abd2-041527872fc6","block_type":"box","text":"circumstances, as well as input from active investors. BAIS is independent from BlackRock Investment Stewardship","page_number":197,"box":{"x":69,"y":146,"width":825,"height":11}},{"id":"62469933-33c2-47fc-ac2d-a400fd2c20e9","block_type":"box","text":"in our engagement and voting activities, reporting lines, and oversight.","page_number":197,"box":{"x":70,"y":161,"width":500,"height":11}},{"id":"a3cb4228-56bf-44ef-a96f-158d7a2080ed","block_type":"box","text":"The Stewardship Leaders Group, comprised of senior active investors and other relevant stakeholders in","page_number":197,"box":{"x":101,"y":179,"width":744,"height":11}},{"id":"04d9e6ce-8356-4cfc-8b5f-10d76639de2b","block_type":"box","text":"BlackRock’s legal, public policy, sustainability and communications teams, helps shape the firm’s approach to","page_number":197,"box":{"x":70,"y":194,"width":786,"height":11}},{"id":"9928e823-3448-414f-b893-0196754510c2","block_type":"box","text":"investment stewardship on non-index equity investment strategies. The Group may advise on and review amendments","page_number":197,"box":{"x":70,"y":209,"width":839,"height":11}},{"id":"1d175a52-5dec-43ab-9d3f-f7aec301d0a2","block_type":"box","text":"to BAIS’ policies and practices. It does not determine voting decisions, which are the responsibility of BAIS and the","page_number":197,"box":{"x":68,"y":224,"width":822,"height":11}},{"id":"9e067bc4-2bad-41f7-b9b6-11c63c9c72bb","block_type":"box","text":"relevant active equity investors.","page_number":197,"box":{"x":69,"y":239,"width":223,"height":11}},{"id":"5d0c9341-6a1c-40a9-bbb5-138e5da4d5f2","block_type":"box","text":"BAIS carries out engagement with companies in collaboration with active investment colleagues, executes proxy","page_number":197,"box":{"x":102,"y":257,"width":797,"height":12}},{"id":"8cb75180-3354-47a8-b891-9df4072e147c","block_type":"box","text":"votes, and conducts vote operations (including maintaining records of votes cast) in a manner consistent with the","page_number":197,"box":{"x":68,"y":272,"width":810,"height":11}},{"id":"09241ad3-b66f-4683-986f-c8fb166a1923","block_type":"box","text":"Guidelines. BAIS also conducts research on corporate governance issues and participates in industry discussions to","page_number":197,"box":{"x":69,"y":287,"width":832,"height":11}},{"id":"301ceb0c-2a15-4aca-ad53-2cd98e04f702","block_type":"box","text":"contribute to and keep abreast of important developments in the corporate governance field. BAIS may use third","page_number":197,"box":{"x":69,"y":302,"width":801,"height":11}},{"id":"81356a46-4b4a-42d2-8166-b3f409d77fb6","block_type":"box","text":"parties for certain of the foregoing activities and performs oversight of those third parties (see “Use and oversight of","page_number":197,"box":{"x":70,"y":317,"width":836,"height":11}},{"id":"30683b2e-3448-4796-9512-62af3b4dba28","block_type":"box","text":"third-party vote services providers” below).","page_number":197,"box":{"x":68,"y":332,"width":305,"height":11}},{"id":"a12530dd-cad2-4d4c-ab52-67cff3e53323","block_type":"box","text":"Voting guidelines and vote execution","page_number":197,"box":{"x":68,"y":354,"width":269,"height":11}},{"id":"92963e2e-14cd-484b-a627-8fbdf4653e33","block_type":"box","text":"BlackRock votes on proxy issues when our clients authorize us to do so. We carefully consider the voting items","page_number":197,"box":{"x":102,"y":373,"width":790,"height":11}},{"id":"adf1222b-2a0d-4ce3-b2de-06dd3b55acbf","block_type":"box","text":"submitted to funds and other fiduciary account(s) (Fund or Funds) for which we have voting authority. BlackRock votes","page_number":197,"box":{"x":69,"y":387,"width":838,"height":12}},{"id":"34519672-b550-490d-a2f3-8ce75ee36f5c","block_type":"box","text":"(or refrains from voting) for each Fund for which we have voting authority based on our evaluation of the alignment of","page_number":197,"box":{"x":69,"y":402,"width":831,"height":12}},{"id":"a4972e91-5620-42e4-b440-218eccd00365","block_type":"box","text":"the voting items with the long-term economic interests of our clients, in the exercise of our independent business","page_number":197,"box":{"x":68,"y":417,"width":809,"height":12}},{"id":"1e7caf4e-a76b-4087-a01a-38e361698f6d","block_type":"box","text":"judgment, and without regard to the relationship of the issuer (or any shareholder proponent or dissident","page_number":197,"box":{"x":67,"y":432,"width":749,"height":11}},{"id":"01fe34ca-ca00-4568-9e7d-95d2fe4a4737","block_type":"box","text":"shareholder) to the Fund, the Fund’s affiliates (if any), BlackRock or BlackRock’s affiliates, or BlackRock employees","page_number":197,"box":{"x":69,"y":447,"width":825,"height":11}},{"id":"d8770875-0790-445f-88dd-3c0ed2bc626e","block_type":"box","text":"(see “Conflicts management policies and procedures,” below).","page_number":197,"box":{"x":69,"y":462,"width":445,"height":11}},{"id":"200873c6-f90c-4dca-a2cd-94f03e14f1cf","block_type":"box","text":"When exercising voting rights, BAIS will normally vote on specific proxy issues in accordance with the Guidelines,","page_number":197,"box":{"x":101,"y":480,"width":803,"height":12}},{"id":"6ebd4603-1576-4166-9278-f1dc9da1b0e2","block_type":"box","text":"although portfolio managers have the right to vote differently on their holdings if they determine doing so is more","page_number":197,"box":{"x":69,"y":495,"width":806,"height":12}},{"id":"c367c959-2f8b-482a-b624-49c94c99019b","block_type":"box","text":"aligned with the investment objective and financial interests of clients invested in the funds they manage.","page_number":197,"box":{"x":69,"y":510,"width":752,"height":11}},{"id":"af13e3d7-f0ae-4c66-86d5-596c687a35b7","block_type":"box","text":"The Guidelines are not intended to be exhaustive. BAIS applies the Guidelines on a case-by-case basis, in the","page_number":197,"box":{"x":101,"y":529,"width":782,"height":11}},{"id":"418e1f16-ff69-4b75-81da-00e66362abea","block_type":"box","text":"context of the individual circumstances of each company and the specific issue under review. As such, the Guidelines","page_number":197,"box":{"x":69,"y":544,"width":837,"height":11}},{"id":"794d58cd-debc-4a27-8539-60b600169f70","block_type":"box","text":"do not indicate how BAIS will vote in every instance. Rather, they reflect our view about corporate governance issues","page_number":197,"box":{"x":69,"y":559,"width":830,"height":11}},{"id":"36f5833f-5246-4f8e-a05c-80788506fd11","block_type":"box","text":"generally, and provide insight into how we typically approach issues that are commonly put to a shareholder vote. The","page_number":197,"box":{"x":68,"y":574,"width":838,"height":11}},{"id":"00d739a5-a3dc-499b-a3c3-6e5b8081e566","block_type":"box","text":"Guidelines are reviewed annually and updated as necessary to reflect changes in market practices, developments in","page_number":197,"box":{"x":69,"y":588,"width":829,"height":12}},{"id":"95c86f91-96cc-4b19-b8dd-32a1d7c010c0","block_type":"box","text":"corporate governance and feedback from companies and clients. In this way, BAIS aims to maintain policies that","page_number":197,"box":{"x":69,"y":603,"width":802,"height":11}},{"id":"98ab8e64-b5e3-492b-b093-00a81b741028","block_type":"box","text":"explain our approach to governance practices most aligned with clients’ long-term financial interests.","page_number":197,"box":{"x":69,"y":618,"width":718,"height":11}},{"id":"76dbcab1-8c4a-4c53-9d82-3beaa53b7a4a","block_type":"box","text":"In certain markets, proxy voting involves logistical issues which can affect BAIS’ ability to vote such proxies, as","page_number":197,"box":{"x":102,"y":637,"width":792,"height":11}},{"id":"7c43153a-57de-4355-8309-6435c59ad19e","block_type":"box","text":"well as the desirability of voting such proxies. These issues include, but are not limited to: i) untimely notice of","page_number":197,"box":{"x":68,"y":652,"width":791,"height":11}},{"id":"2ce6e843-f4c3-4a3f-b79c-20912af19e6d","block_type":"box","text":"shareholder meetings; ii) restrictions on a foreigner’s ability to exercise votes; iii) requirements to vote proxies in","page_number":197,"box":{"x":69,"y":666,"width":805,"height":12}},{"id":"88b1a788-600c-4eca-98b3-519bb08ecdf8","block_type":"box","text":"person; iv) “share-blocking” (requirements that investors who exercise their voting rights surrender the right to","page_number":197,"box":{"x":70,"y":682,"width":784,"height":11}},{"id":"d1797051-9ff5-4568-b93d-90d4c8751eac","block_type":"box","text":"dispose of their holdings from the point at which votes are submitted until after the shareholder meeting has","page_number":197,"box":{"x":69,"y":696,"width":775,"height":11}},{"id":"997b37eb-a58b-4006-a73b-6abae75c070d","block_type":"box","text":"occurred); v) potential difficulties in translating the proxy; vi) regulatory constraints; and vii) requirements to provide","page_number":197,"box":{"x":69,"y":711,"width":824,"height":11}},{"id":"ed55f6b4-3ccb-4954-96ef-850b67d9e82b","block_type":"box","text":"local agents with powers of attorney to facilitate voting instructions. We are not supportive of impediments to the","page_number":197,"box":{"x":70,"y":726,"width":806,"height":11}},{"id":"1cbdded5-1155-4616-92d9-73ad41affb5b","block_type":"box","text":"exercise of voting rights such as share-blocking or overly burdensome administrative requirements.","page_number":197,"box":{"x":69,"y":741,"width":704,"height":11}},{"id":"041996e0-22c2-423f-b326-19c39e40229a","block_type":"box","text":"BlackRock votes proxies in these situations on a “best-efforts” basis. In addition, BAIS may determine that it is","page_number":197,"box":{"x":102,"y":759,"width":796,"height":12}},{"id":"944f5f55-de37-459d-bc61-ba87629afee0","block_type":"box","text":"generally in the interests of BlackRock’s clients not to vote proxies (or not to vote our full allocation) if the costs","page_number":197,"box":{"x":68,"y":774,"width":799,"height":12}},{"id":"ad5ff60e-b493-4b32-aa85-712e370ea45f","block_type":"box","text":"(including but not limited to opportunity costs associated with share-blocking constraints) associated with exercising","page_number":197,"box":{"x":69,"y":789,"width":829,"height":11}},{"id":"30c87779-baf6-4c85-969e-6b20539c7b09","block_type":"box","text":"a vote are expected to outweigh the benefit the client would derive by voting on the proposal.","page_number":197,"box":{"x":69,"y":804,"width":661,"height":11}},{"id":"fad2bbae-1f6e-471e-b4e5-e0169b3849b2","block_type":"box","text":"Voting Choice","page_number":197,"box":{"x":68,"y":826,"width":101,"height":12}},{"id":"390731a9-750c-4c0a-b0fc-507cbfba82a3","block_type":"box","text":"BlackRock offers Voting Choice, a program that provides eligible clients with more opportunities to participate in","page_number":197,"box":{"x":102,"y":845,"width":800,"height":11}},{"id":"8542156d-b5ef-4fc1-b50b-406bf4b8c8a2","block_type":"box","text":"the proxy voting process where legally and operationally viable.","page_number":197,"box":{"x":68,"y":860,"width":447,"height":11}},{"id":"9f1ff84d-bcdc-4a40-adc4-87b2a51247f2","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":197,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"4ccd75c2-236c-4a54-8a20-1660015e8f84","block_type":"box","text":"Global Engagement and Voting Guidelines | 16","page_number":197,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"87b7da1c-eb1d-475f-8ed6-4d2228edc7a5","block_type":"box","text":"NM0926U-5977317-197/232","page_number":197,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"00a1d6b4-844a-461a-b094-6a1fe59885bb","block_type":"box","text":"Voting Choice is currently available for eligible clients invested in certain institutional pooled funds in the U.S.,","page_number":198,"box":{"x":101,"y":45,"width":786,"height":11}},{"id":"e7048fb7-2f4d-4d23-87af-c20b78e74cdc","block_type":"box","text":"UK, and Canada that use systematic active equity (SAE) and multi-asset strategies. In addition, institutional clients in","page_number":198,"box":{"x":70,"y":60,"width":834,"height":11}},{"id":"fb568b00-7498-439e-be3a-955840d9aa57","block_type":"box","text":"separately managed accounts (SMAs) are eligible for BlackRock Voting Choice regardless of their investment","page_number":198,"box":{"x":69,"y":74,"width":774,"height":12}},{"id":"e19e85ec-24b2-4e9e-88ea-e837ea855051","block_type":"box","text":"strategies.","page_number":198,"box":{"x":69,"y":89,"width":74,"height":12}},{"id":"bb5af5e0-e29e-4779-a4aa-728b87aafec9","block_type":"box","text":"12","page_number":198,"box":{"x":145,"y":90,"width":9,"height":4}},{"id":"cf66190a-bdfe-4874-a7ce-35dcfc8cfb6f","block_type":"box","text":"As a result, the shares attributed to BlackRock in company share registers may be voted differently depending","page_number":198,"box":{"x":101,"y":108,"width":788,"height":11}},{"id":"92cd9d93-9bbb-44fc-b480-070e5d20eb72","block_type":"box","text":"on whether our clients have authorized BAIS to vote on their behalf, have authorized BlackRock to vote in accordance","page_number":198,"box":{"x":69,"y":123,"width":834,"height":10}},{"id":"9fef6081-ddde-432c-b911-f1a53611116d","block_type":"box","text":"with a third-party policy, or have elected to vote shares in accordance with their own policy. 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Reliance upon this information is","page_number":200,"box":{"x":68,"y":822,"width":823,"height":11}},{"id":"0467c61e-45ab-4c2c-87a8-5528529c916f","block_type":"box","text":"at the sole discretion of the reader.","page_number":200,"box":{"x":69,"y":837,"width":250,"height":9}},{"id":"b4a90d4c-4a7f-41bd-9593-33490bf10b8f","block_type":"box","text":"Prepared by BlackRock, Inc.","page_number":200,"box":{"x":69,"y":868,"width":196,"height":10}},{"id":"c2cf6b33-3774-477d-83ca-110ee4c8afc0","block_type":"box","text":"©","page_number":200,"box":{"x":68,"y":898,"width":6,"height":4}},{"id":"cf7c8728-4a29-466b-bcdc-a431bc722500","block_type":"box","text":"2025 BlackRock, Inc. All rights reserved. BLACKROCK is a trademark of BlackRock, Inc., or its subsidiaries in the","page_number":200,"box":{"x":75,"y":898,"width":809,"height":11}},{"id":"fc533211-fddb-46f5-8dba-b9a2a03bd9b5","block_type":"box","text":"United States and elsewhere. All other trademarks are those of their respective owners.","page_number":200,"box":{"x":70,"y":913,"width":624,"height":11}},{"id":"275c3eb8-ab5a-48f4-a7de-db2df49fb684","block_type":"box","text":"BlackRock Active Investment Stewardship","page_number":200,"box":{"x":69,"y":943,"width":311,"height":11}},{"id":"c8ad9f8c-ee2e-4052-84be-0f7cf83ff44e","block_type":"box","text":"Global Engagement and Voting Guidelines | 19","page_number":200,"box":{"x":580,"y":942,"width":329,"height":13}},{"id":"9a43fe64-db1d-4a0b-a28b-de35d6aec461","block_type":"box","text":"NM0926U-5977317-200/232","page_number":200,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"6f444be1-3c7b-4264-bee7-9b0e6d6b53b1","block_type":"box","text":"Index Equity Fund Proxy Voting Policy","page_number":201,"box":{"x":352,"y":75,"width":275,"height":11}},{"id":"df68881c-e02f-4603-a21d-97a54acd0e77","block_type":"box","text":"Procedures Governing Delegation of Proxy Voting to Fund 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Funds","page_number":201,"box":{"x":205,"y":173,"width":589,"height":11}},{"id":"fe364a4a-6c61-4357-bf7a-36ce20f02748","block_type":"box","text":"□","page_number":201,"box":{"x":405,"y":196,"width":14,"height":11}},{"id":"5183d8a1-5eb4-4148-b2b0-b275afbae0f1","block_type":"box","text":"Money Market Funds","page_number":201,"box":{"x":426,"y":196,"width":147,"height":11}},{"id":"dc26128a-bc37-45c1-8c96-695e87793eef","block_type":"box","text":"□","page_number":201,"box":{"x":416,"y":218,"width":14,"height":12}},{"id":"7799f5f3-4f1f-4abc-bae5-ea539496284b","block_type":"box","text":"Closed-End Funds","page_number":201,"box":{"x":437,"y":219,"width":125,"height":8}},{"id":"0d38612f-d5ea-47f5-9199-7f9f1fadd106","block_type":"box","text":"□","page_number":201,"box":{"x":460,"y":241,"width":14,"height":11}},{"id":"48995b40-a46b-434a-a9d6-0183aa1840fa","block_type":"box","text":"Other","page_number":201,"box":{"x":481,"y":241,"width":38,"height":9}},{"id":"2fdcb6d4-a550-42f7-996c-1e0ca2440f21","block_type":"box","text":"Objective and Scope","page_number":201,"box":{"x":101,"y":260,"width":149,"height":11}},{"id":"6edfaad2-9040-4433-bef1-1f2d6b5058b6","block_type":"box","text":"Set forth below is the Index Equity Fund Proxy Voting Policy.","page_number":201,"box":{"x":134,"y":279,"width":421,"height":11}},{"id":"ea94d3f8-7029-4e5e-afa6-a39e311ba16e","block_type":"box","text":"Policy/Document Requirements and Statements","page_number":201,"box":{"x":102,"y":297,"width":354,"height":11}},{"id":"fcdb9a6f-2865-4fc5-969f-69837ccb68a2","block_type":"box","text":"The Boards of Trustees/Directors (“Directors”) of certain open-end funds (the “Funds”) advised by","page_number":201,"box":{"x":134,"y":316,"width":702,"height":11}},{"id":"5456fc28-4c75-431e-a3a2-fa01faca8323","block_type":"box","text":"BlackRock Fund Advisors or BlackRock Advisors, LLC (“BlackRock”), have the responsibility for the oversight of","page_number":201,"box":{"x":102,"y":331,"width":789,"height":11}},{"id":"5f3fa9cb-a073-4b93-baa6-c4564bb97ed1","block_type":"box","text":"voting proxies relating to portfolio securities of the Funds, and have determined that it is in the best interests of","page_number":201,"box":{"x":101,"y":346,"width":801,"height":11}},{"id":"e2346a01-54ed-4feb-9b99-ec3015c120ab","block_type":"box","text":"the Funds and their shareholders to delegate the responsibility to vote proxies to BlackRock, subject to the","page_number":201,"box":{"x":101,"y":361,"width":763,"height":11}},{"id":"c9b0dde4-0b11-4a79-a2e5-a7643221a84a","block_type":"box","text":"principles outlined in this Policy, as part of BlackRock’s authority to manage, acquire and dispose of account","page_number":201,"box":{"x":102,"y":375,"width":775,"height":12}},{"id":"f3ffc997-d425-43f7-a19e-0eacf41aabef","block_type":"box","text":"assets, all as contemplated by the Funds’ respective investment management agreements.","page_number":201,"box":{"x":102,"y":391,"width":651,"height":11}},{"id":"cf6067b9-4aaa-4eed-9cee-9d3481461146","block_type":"box","text":"BlackRock has adopted the BlackRock Investment Stewardship Global Benchmark Policy (as from time to","page_number":201,"box":{"x":135,"y":409,"width":748,"height":11}},{"id":"cd28948f-3df0-41c3-9a58-83982daf0eac","block_type":"box","text":"time amended, the “Guidelines”) governing proxy voting by index equity Funds managed by BlackRock, except for","page_number":201,"box":{"x":101,"y":424,"width":804,"height":11}},{"id":"2d03e1d3-737e-4515-b714-a9ed852732ed","block_type":"box","text":"the iShares Core S&P 500 ETF. In addition, BlackRock has adopted guidelines and procedures (as from time to","page_number":201,"box":{"x":101,"y":439,"width":793,"height":11}},{"id":"c33bb710-9426-49b4-848f-444b81bddf11","block_type":"box","text":"time amended, the “BlackRock Climate and Decarbonization Stewardship Guidelines”) governing proxy voting for","page_number":201,"box":{"x":101,"y":454,"width":801,"height":11}},{"id":"31ceb0df-be77-4e95-808c-afe556066635","block_type":"box","text":"matters covered in the BlackRock Climate and Decarbonization Stewardship Guidelines by the Funds listed in","page_number":201,"box":{"x":102,"y":469,"width":777,"height":11}},{"id":"1e7b11a0-4be2-43df-a469-bc6374619699","block_type":"box","text":"Appendix A.","page_number":201,"box":{"x":101,"y":484,"width":82,"height":10}},{"id":"1ef9065a-e8f3-43e0-87e1-1d40b37a3713","block_type":"box","text":"BlackRock will cast votes on behalf of each of the Funds covered by this policy on specific proxy issues in","page_number":201,"box":{"x":135,"y":502,"width":751,"height":11}},{"id":"99b410d8-94f9-4461-b23a-3c6699a36a07","block_type":"box","text":"respect of securities held by each such Fund (or may refrain from voting) in accordance with the Guidelines and","page_number":201,"box":{"x":102,"y":517,"width":791,"height":11}},{"id":"42ce5a83-38d4-462f-ae38-1c41aa919772","block_type":"box","text":"the BlackRock Climate and Decarbonization Stewardship Guidelines, as applicable.","page_number":201,"box":{"x":101,"y":532,"width":591,"height":11}},{"id":"2cf98e27-16b1-4a96-86a8-1d48a37352a5","block_type":"box","text":"Conflicts Management","page_number":201,"box":{"x":101,"y":550,"width":165,"height":11}},{"id":"0c7df7b1-87a2-4880-aac5-5a040b879dfe","block_type":"box","text":"BlackRock Investment Stewardship (“BIS”) maintains policies and procedures that seek to prevent undue","page_number":201,"box":{"x":135,"y":569,"width":751,"height":11}},{"id":"50d9133b-69e7-412c-b8ca-9a7fb7bd4d63","block_type":"box","text":"influence on BlackRock’s proxy voting activity and to mitigate material conflicts of interest in the exercise of","page_number":201,"box":{"x":102,"y":584,"width":767,"height":11}},{"id":"796ab28c-7fde-44fc-8e45-21530a02e1fb","block_type":"box","text":"proxy voting responsibilities. Potential material conflicts, and the resultant potential for undue influence, might","page_number":201,"box":{"x":102,"y":599,"width":787,"height":11}},{"id":"ce8f622b-cda6-4263-a920-66b65635a206","block_type":"box","text":"be due to a relationship between the investee company (or any shareholder proponent or dissident shareholder)","page_number":201,"box":{"x":102,"y":614,"width":797,"height":11}},{"id":"fe0bb873-504d-4da6-96fd-7b699abf3d91","block_type":"box","text":"and BlackRock, BlackRock’s affiliates or employees, or a Fund or a Fund’s affiliates. BlackRock has taken","page_number":201,"box":{"x":102,"y":628,"width":756,"height":12}},{"id":"f24467b9-921b-4f04-821c-c6da72c40883","block_type":"box","text":"certain steps to mitigate potential conflicts, which are outlined in detail in the Guidelines. 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The Guidelines set forth BlackRock’s approach to recalling securities on loan in","page_number":201,"box":{"x":102,"y":755,"width":778,"height":11}},{"id":"6a6f646d-2f64-4679-be5e-9f62b038074b","block_type":"box","text":"connection with proxy voting.","page_number":201,"box":{"x":101,"y":770,"width":203,"height":11}},{"id":"7e593f21-b3c0-4ce8-a214-0117464e2cec","block_type":"box","text":"Reports to the Board","page_number":201,"box":{"x":102,"y":789,"width":153,"height":10}},{"id":"ac827112-4daf-4dbf-8482-f008f5042709","block_type":"box","text":"BlackRock will report on an annual basis to the Directors on (1) a summary of the proxy voting process as","page_number":201,"box":{"x":135,"y":807,"width":755,"height":11}},{"id":"dbaf9f1e-08b7-452d-81aa-db9744c7e606","block_type":"box","text":"applicable to the Funds covered by this policy in the preceding year together with a representation that all 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These are topics that shareholders may have","page_number":206,"box":{"x":69,"y":475,"width":822,"height":12}},{"id":"65095b06-7ddd-4a70-bed7-6947c3c8bb5b","block_type":"box","text":"the ability to vote on at shareholder meetings. 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Our regional voting guidelines explain how the BIS Global","page_number":206,"box":{"x":69,"y":717,"width":781,"height":12}},{"id":"2e09bb38-921b-4477-a57a-dee5e6e86718","block_type":"box","text":"Principles inform our voting decisions in relation to common ballot items for shareholder meetings in those markets.","page_number":206,"box":{"x":69,"y":732,"width":829,"height":12}},{"id":"e56073db-3dd3-4c7a-917a-272fa7fd3abd","block_type":"box","text":"4","page_number":206,"box":{"x":899,"y":733,"width":5,"height":4}},{"id":"bb0854e3-bfb6-421e-8c88-116a4cf5f99b","block_type":"box","text":"3","page_number":206,"box":{"x":69,"y":762,"width":4,"height":5}},{"id":"4fd2503e-6c27-4930-b1d1-17a36424e13f","block_type":"box","text":"Examples include: Government of Canada, “Canada Business Corporations Act,” amended 2024; European Union,","page_number":206,"box":{"x":79,"y":762,"width":816,"height":11}},{"id":"f5e0dc77-611a-4914-a3bd-3de56a679dd3","block_type":"box","text":"“Shareholder Rights Directive II,” 2017; and the China Securities Regulatory Commission, “Code of Corporate","page_number":206,"box":{"x":70,"y":777,"width":784,"height":11}},{"id":"77d6a46d-299b-4bcf-be24-662a9dc19267","block_type":"box","text":"Governance for Listed Companies in China,” 2001. Websites accessed in December 2025.","page_number":206,"box":{"x":69,"y":792,"width":650,"height":11}},{"id":"2171ef74-40b3-4445-967e-f61d9d7f3b6b","block_type":"box","text":"4","page_number":206,"box":{"x":69,"y":810,"width":4,"height":4}},{"id":"db14ff40-cfc7-4b13-b272-cc03a90513d0","block_type":"box","text":"Our regional voting guidelines reflect these different market standards and norms. Depending on the market,","page_number":206,"box":{"x":79,"y":810,"width":776,"height":11}},{"id":"14ef3623-0dd1-4bfe-aed9-86b1eb41f9a7","block_type":"box","text":"generally accepted practice is informed by corporate law, market regulation, best practices, and industry initiatives,","page_number":206,"box":{"x":68,"y":825,"width":821,"height":11}},{"id":"7a7f070b-db41-4fe3-acb4-3810893de897","block_type":"box","text":"amongst other factors. BIS carries out engagement with companies, executes proxy votes, and conducts vote","page_number":206,"box":{"x":69,"y":840,"width":780,"height":11}},{"id":"29585671-aeb4-4e49-8e64-21cddcacbc9e","block_type":"box","text":"operations (including maintaining records of votes cast) in a manner consistent with the relevant regional voting","page_number":206,"box":{"x":69,"y":855,"width":796,"height":11}},{"id":"a7673199-5e77-40b3-8fa5-cd0e2f330546","block_type":"box","text":"guidelines.","page_number":206,"box":{"x":68,"y":870,"width":76,"height":11}},{"id":"904924a5-aa62-49df-a7f0-94f2c046e7b0","block_type":"box","text":"BlackRock Investment Stewardship","page_number":206,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"d5a56daf-74f2-4512-b0da-396b38008376","block_type":"box","text":"Global Principles | 4","page_number":206,"box":{"x":768,"y":942,"width":141,"height":13}},{"id":"d7f4a32e-9ebb-48a8-ab93-33d1901706d9","block_type":"box","text":"NM0926U-5977317-206/232","page_number":206,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"8170f4e4-31fc-44b2-842b-76154d58cbc2","block_type":"box","text":"BOARDS AND DIRECTORS","page_number":207,"box":{"x":394,"y":45,"width":190,"height":9}},{"id":"c3776eae-3a36-414a-94de-92db6f347be9","block_type":"box","text":"Oversight role of the board","page_number":207,"box":{"x":69,"y":75,"width":194,"height":11}},{"id":"6eeaad7f-9613-4bb3-8e62-ec619bf6ab84","block_type":"box","text":"Companies whose boards are comprised of appropriately qualified, engaged directors with professional","page_number":207,"box":{"x":102,"y":98,"width":734,"height":11}},{"id":"c8f6a9da-17b0-463a-9d2c-4c791d81b60f","block_type":"box","text":"characteristics relevant to a company’s business enhance the board’s ability to add long-term financial value and","page_number":207,"box":{"x":69,"y":113,"width":806,"height":11}},{"id":"6fd47800-527d-474c-89c7-ed0d40453f02","block_type":"box","text":"serve as the voice of shareholders in board discussions. In our view, a strong board gives a company a competitive","page_number":207,"box":{"x":69,"y":128,"width":822,"height":11}},{"id":"f80bbb11-8f7f-4de2-9ef2-f6de6bf08cf5","block_type":"box","text":"advantage, providing valuable oversight and contributing to the most important management decisions that support","page_number":207,"box":{"x":69,"y":143,"width":825,"height":11}},{"id":"83a64ccf-13f9-4309-b29e-80f0eb91bef4","block_type":"box","text":"long-term financial performance.","page_number":207,"box":{"x":70,"y":158,"width":229,"height":11}},{"id":"4a8be024-8e8d-4e91-984e-3545a46759d0","block_type":"box","text":"For this reason, our investment stewardship efforts focus on the effectiveness of the board of directors. We","page_number":207,"box":{"x":102,"y":181,"width":771,"height":11}},{"id":"b5cd75c5-1e72-4e60-9ed7-d55e271e5724","block_type":"box","text":"engage, as necessary, with members of the board’s nominating and/or governance committee to assess whether","page_number":207,"box":{"x":69,"y":196,"width":811,"height":11}},{"id":"cc1f1937-5ce2-4a66-b9f6-79f0a73cc3b8","block_type":"box","text":"governance practices and board composition are effective given a company’s business model, sector, market, and","page_number":207,"box":{"x":68,"y":211,"width":817,"height":11}},{"id":"0a090345-f2a2-49d1-810b-b558e91c6467","block_type":"box","text":"the business environment in which a company is operating.","page_number":207,"box":{"x":68,"y":226,"width":422,"height":11}},{"id":"d134622c-47cf-49e6-845b-3cc95011791a","block_type":"box","text":"We consider it good practice when the board establishes and maintains a framework of robust and effective","page_number":207,"box":{"x":101,"y":249,"width":770,"height":11}},{"id":"685365e4-fdf4-4721-8f19-8d37e309eed4","block_type":"box","text":"governance mechanisms that supports its oversight of the company’s strategy and operations, consistent with the","page_number":207,"box":{"x":68,"y":264,"width":817,"height":11}},{"id":"f006d1e5-477d-4692-91ed-dc65314804b0","block_type":"box","text":"long-term financial interests of investors. This includes having clear descriptions of the role of the board and the","page_number":207,"box":{"x":70,"y":279,"width":799,"height":11}},{"id":"ccc379f9-5511-4354-8844-afddc33d3a95","block_type":"box","text":"committees of the board and how directors engage with and oversee management, as well as disclosure of material","page_number":207,"box":{"x":69,"y":294,"width":827,"height":11}},{"id":"1311dce0-f5b7-4ffb-b7d4-efeef87f6af0","block_type":"box","text":"risks that may affect a company’s long-term strategy and how management is effectively identifying, managing, and","page_number":207,"box":{"x":69,"y":309,"width":822,"height":11}},{"id":"60217885-3a0e-49c8-a86b-180b1ff085b4","block_type":"box","text":"mitigating such risks.","page_number":207,"box":{"x":69,"y":325,"width":150,"height":11}},{"id":"1dbafa04-89ab-4f98-b2ce-1c6e4c76bf1e","block_type":"box","text":"Understanding management’s long-term strategy and the milestones against which investors should assess its","page_number":207,"box":{"x":102,"y":347,"width":791,"height":11}},{"id":"f752cc34-65f1-443d-9450-33f4cc9554b7","block_type":"box","text":"implementation is central to our approach. If any strategic targets are significantly missed or materially restated, we","page_number":207,"box":{"x":70,"y":362,"width":826,"height":11}},{"id":"629aa0a8-cb76-4259-ae46-a8584c72027e","block_type":"box","text":"find it helpful when company disclosures provide a detailed explanation of the changes and an indication of the","page_number":207,"box":{"x":68,"y":377,"width":793,"height":12}},{"id":"6f191d67-c45a-401e-81aa-6412e17bc37c","block_type":"box","text":"board’s role in reviewing the revised targets. We look to the board to articulate the effectiveness of these","page_number":207,"box":{"x":69,"y":392,"width":755,"height":12}},{"id":"067782c4-99ad-4d91-b086-7c74adb6aa1e","block_type":"box","text":"mechanisms in overseeing the management of business risks and opportunities and the fulfillment of the company’s","page_number":207,"box":{"x":69,"y":407,"width":835,"height":12}},{"id":"58aab2bc-0744-40b9-9f55-b6a3c94cd1c6","block_type":"box","text":"strategy.","page_number":207,"box":{"x":69,"y":423,"width":58,"height":11}},{"id":"5eb6c833-6944-4b2a-b094-71214c4453fd","block_type":"box","text":"Where a company has not adequately disclosed or demonstrated that its board has fulfilled these corporate","page_number":207,"box":{"x":101,"y":445,"width":769,"height":11}},{"id":"253eb635-f2eb-48ad-b651-496d97e323b2","block_type":"box","text":"governance and risk oversight responsibilities, we may consider not supporting the election of directors who, in our","page_number":207,"box":{"x":68,"y":460,"width":823,"height":12}},{"id":"1695a1a1-9bee-48f5-abf0-664fdcf9f30b","block_type":"box","text":"assessment, have particular responsibility for the issues.","page_number":207,"box":{"x":69,"y":475,"width":409,"height":12}},{"id":"e6e8bf56-671d-4332-9f72-aed64dc0be9d","block_type":"box","text":"When casting vote decisions on behalf of clients on the election of directors, some of the factors that speak to","page_number":207,"box":{"x":101,"y":498,"width":791,"height":11}},{"id":"f6d9772c-67c0-4fa8-a3d1-bff78583c031","block_type":"box","text":"the board’s effectiveness as a group include the relevance of individual directors’ qualifications and skillsets, as well","page_number":207,"box":{"x":68,"y":513,"width":836,"height":12}},{"id":"9c2ed2b7-faed-4a2b-ad68-b0c8e4f47a25","block_type":"box","text":"as directors’ capacity and other time commitments, and how these factors may contribute to the company’s financial","page_number":207,"box":{"x":69,"y":528,"width":833,"height":12}},{"id":"989ed11c-922d-4dd5-81cd-235bea1b9ff1","block_type":"box","text":"performance. We look to boards to establish formal and transparent processes for nominating directors that reflect","page_number":207,"box":{"x":70,"y":543,"width":823,"height":12}},{"id":"1b594bf9-49b0-4284-a82c-a252b761e67d","block_type":"box","text":"the company’s long-term strategy and business model.","page_number":207,"box":{"x":68,"y":559,"width":390,"height":11}},{"id":"0c9ab966-d494-4ea8-99e7-669411fed1ab","block_type":"box","text":"In the section titled “Board quality and effectiveness” below, we provide more detail about our approach to board","page_number":207,"box":{"x":102,"y":581,"width":807,"height":11}},{"id":"3df14d3c-5b59-4004-a6a5-fb76a0480111","block_type":"box","text":"composition and how it underpins board effectiveness and long-term financial value creation.","page_number":207,"box":{"x":69,"y":596,"width":662,"height":12}},{"id":"fa42054f-eff8-4bdc-bab9-922a3c1a3060","block_type":"box","text":"Regular accountability through director elections","page_number":207,"box":{"x":69,"y":627,"width":358,"height":11}},{"id":"f4327d91-bea1-4fdc-8034-66da3bffc09f","block_type":"box","text":"The election of directors to the board is a right of shareholders and an important signal of support for, or","page_number":207,"box":{"x":101,"y":649,"width":750,"height":12}},{"id":"f16df8bc-ea20-476d-8857-16db0f5e455d","block_type":"box","text":"concern about, the performance of the board in overseeing and advising management. To ensure accountability for","page_number":207,"box":{"x":69,"y":664,"width":819,"height":12}},{"id":"d8d9065d-f774-4067-903e-57eb7e5e1f8e","block_type":"box","text":"their decisions on behalf of shareholders, directors should stand for election on a regular basis, ideally annually.","page_number":207,"box":{"x":68,"y":680,"width":802,"height":11}},{"id":"d177f63b-f995-4479-aa2e-d4877c034bfe","block_type":"box","text":"5","page_number":207,"box":{"x":872,"y":680,"width":4,"height":4}},{"id":"7dc4f97b-9e24-4fde-944d-dbd854326eb4","block_type":"box","text":"Annual director elections allow shareholders to reaffirm their support for, or concerns about, board members’","page_number":207,"box":{"x":68,"y":695,"width":782,"height":11}},{"id":"1bc50d40-50e8-479b-b41d-93e4e0decbea","block_type":"box","text":"decisions in a timely manner. When board members are not elected annually, we consider it good practice for boards","page_number":207,"box":{"x":69,"y":710,"width":832,"height":11}},{"id":"f8d28ff4-c700-4d85-b41c-218085b4159e","block_type":"box","text":"to have a rotation policy to ensure that, through a board cycle, all directors have had their appointment re-confirmed,","page_number":207,"box":{"x":68,"y":725,"width":832,"height":11}},{"id":"73bd17d9-bc17-4818-8b23-1fba59d55320","block_type":"box","text":"with a proportion of directors being put forward for election at each shareholder meeting.","page_number":207,"box":{"x":68,"y":740,"width":636,"height":11}},{"id":"e2de8b56-e3b5-463d-99a7-5659ccf34e93","block_type":"box","text":"BOARD QUALITY AND EFFECTIVENESS","page_number":207,"box":{"x":348,"y":770,"width":282,"height":11}},{"id":"5a06d48e-cb86-434b-80de-6e12666fda05","block_type":"box","text":"Regular director elections also give boards the opportunity to adjust their composition in an orderly way to reflect","page_number":207,"box":{"x":102,"y":793,"width":805,"height":11}},{"id":"9d388298-afab-4fc3-af97-f6709d2e101e","block_type":"box","text":"developments in the company’s strategy and the market environment. In our view, it is beneficial for new directors to","page_number":207,"box":{"x":69,"y":808,"width":831,"height":11}},{"id":"48ba9823-8eb9-4fb7-a147-86e5c10b6940","block_type":"box","text":"be brought onto the board periodically to refresh the group’s thinking, while supporting both continuity and","page_number":207,"box":{"x":69,"y":823,"width":758,"height":12}},{"id":"b236ffb7-7649-4747-b690-3d188494709a","block_type":"box","text":"5","page_number":207,"box":{"x":69,"y":853,"width":4,"height":4}},{"id":"678fd4dc-70fc-4518-b944-4abd8ab41cb1","block_type":"box","text":"In most markets, directors stand for re-election on an annual or triennial basis, as determined by corporate law,","page_number":207,"box":{"x":79,"y":852,"width":795,"height":12}},{"id":"9923cc45-75cd-4ae9-9f2f-a6a271efcf08","block_type":"box","text":"market regulation or voluntary best practice.","page_number":207,"box":{"x":69,"y":868,"width":314,"height":11}},{"id":"0ccc4155-8c40-4180-8eb8-f201c6fd61cc","block_type":"box","text":"BlackRock Investment Stewardship","page_number":207,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"f1f578af-c425-4b96-ad94-6ad24db812b8","block_type":"box","text":"Global Principles | 5","page_number":207,"box":{"x":768,"y":942,"width":141,"height":13}},{"id":"e10d42cc-7cde-44ef-b9cf-d9d82485ffca","block_type":"box","text":"NM0926U-5977317-207/232","page_number":207,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"6fa4182a-4e2a-4ad0-9f02-7779548aa758","block_type":"box","text":"appropriate succession planning. We consider the average overall tenure of the board and seek a balance between","page_number":208,"box":{"x":69,"y":45,"width":819,"height":11}},{"id":"0bd80dcd-a7ff-4551-8ace-6836f0d8d76e","block_type":"box","text":"the knowledge and experience of longer-serving directors and the fresh perspectives of directors who joined more","page_number":208,"box":{"x":68,"y":60,"width":809,"height":11}},{"id":"f25ddadb-2173-440f-99b7-86f99be67ce4","block_type":"box","text":"recently.","page_number":208,"box":{"x":69,"y":75,"width":57,"height":11}},{"id":"58d68359-900a-4f1c-911d-6acd708ac64f","block_type":"box","text":"We appreciate when companies regularly review and assess how directors nominated for election contribute to","page_number":208,"box":{"x":101,"y":98,"width":789,"height":11}},{"id":"8fc89719-3eb8-44a3-92b8-9918d47a6b57","block_type":"box","text":"the effectiveness of the board. In our view, the company’s assessment should consider a number of factors,","page_number":208,"box":{"x":68,"y":113,"width":774,"height":11}},{"id":"1617dc08-13e5-4dbc-b366-48cc4f24a3dc","block_type":"box","text":"including each director’s independence and time commitments, as well as the breadth and relevance of director","page_number":208,"box":{"x":70,"y":128,"width":798,"height":11}},{"id":"79481417-8593-483d-b495-ff547646025e","block_type":"box","text":"experiences and skillsets, and how these collectively contribute to the board’s effectiveness in advising and","page_number":208,"box":{"x":69,"y":143,"width":770,"height":11}},{"id":"f7aee5ef-ac96-407b-8e12-69e1dca602ec","block_type":"box","text":"overseeing management in delivering long-term financial returns.","page_number":208,"box":{"x":69,"y":158,"width":459,"height":11}},{"id":"a5923075-3c86-4473-bbb5-0aab9c679587","block_type":"box","text":"Director independence","page_number":208,"box":{"x":69,"y":188,"width":164,"height":11}},{"id":"2363fe15-443d-4c51-a815-465ac1edcfe2","block_type":"box","text":"Director independence — from management, significant shareholders, or other related parties — is a central","page_number":208,"box":{"x":102,"y":211,"width":777,"height":11}},{"id":"5705bcfe-c185-42c8-b2a0-9eee85f920cc","block_type":"box","text":"tenet of sound corporate governance across markets.","page_number":208,"box":{"x":68,"y":226,"width":382,"height":11}},{"id":"4a5abcf0-914d-4833-b991-3360a5790902","block_type":"box","text":"6","page_number":208,"box":{"x":452,"y":226,"width":4,"height":5}},{"id":"524b2098-5cda-43ee-98c3-6f54a3ce98be","block_type":"box","text":"We look to boards to have a sufficient number of independent","page_number":208,"box":{"x":462,"y":226,"width":442,"height":11}},{"id":"d03e97e9-6f20-44ad-b7f3-f04965ca7526","block_type":"box","text":"directors, free from conflicts of interest or undue influence, to ensure objectivity in the decision-making of the board","page_number":208,"box":{"x":69,"y":241,"width":825,"height":11}},{"id":"df2d50ed-083d-468d-abfc-738c73364cc0","block_type":"box","text":"and its ability to oversee management. We generally consider it good practice for independent directors to make a","page_number":208,"box":{"x":69,"y":256,"width":813,"height":12}},{"id":"b26e3f4a-591e-47e4-8634-27873e94aef3","block_type":"box","text":"majority of the board, or in the case of controlled companies, at least one-third.","page_number":208,"box":{"x":69,"y":271,"width":566,"height":12}},{"id":"40380608-f540-4c31-bec2-26f6552e4899","block_type":"box","text":"Common impediments to independence may include but are not limited to:","page_number":208,"box":{"x":102,"y":294,"width":531,"height":11}},{"id":"164b0509-0586-4fd0-bcaf-b80335a24829","block_type":"box","text":"•","page_number":208,"box":{"x":69,"y":317,"width":6,"height":5}},{"id":"6e166fdc-6adc-40d4-829b-74b0299a6618","block_type":"box","text":"Current or recent employment at the company or a subsidiary","page_number":208,"box":{"x":102,"y":314,"width":438,"height":11}},{"id":"c4108b37-57ce-411f-8295-5aa351e521b1","block_type":"box","text":"•","page_number":208,"box":{"x":69,"y":337,"width":6,"height":5}},{"id":"68af037a-9ad1-4a44-b3a6-b3d479335b98","block_type":"box","text":"Being, or representing, a shareholder with a substantial shareholding in the company","page_number":208,"box":{"x":102,"y":335,"width":606,"height":11}},{"id":"49552797-4ec1-4d1c-a6ed-c9ac83c3f170","block_type":"box","text":"•","page_number":208,"box":{"x":69,"y":357,"width":6,"height":5}},{"id":"7c51b759-ea58-4028-98ec-b683c9e0c412","block_type":"box","text":"Interlocking directorates","page_number":208,"box":{"x":102,"y":355,"width":170,"height":11}},{"id":"17526589-4383-44a2-8fad-cc9c48e11485","block_type":"box","text":"•","page_number":208,"box":{"x":69,"y":378,"width":6,"height":4}},{"id":"73ac8547-19ff-493a-95b4-e056a72650fa","block_type":"box","text":"Having any other interest, business, or other relationship which could, or could reasonably be perceived to,","page_number":208,"box":{"x":102,"y":375,"width":761,"height":11}},{"id":"7744a9f7-1d39-4b93-aa0b-8856303bf678","block_type":"box","text":"materially interfere with a director’s ability to act in the best interests of the company and shareholders","page_number":208,"box":{"x":102,"y":390,"width":738,"height":11}},{"id":"13cdf1c2-cbf0-493b-ab97-b28fd1c6a808","block_type":"box","text":"In our experience, boards are most effective at overseeing and advising management when there is a senior,","page_number":208,"box":{"x":102,"y":412,"width":775,"height":12}},{"id":"5bd777d8-2ea2-41a7-90ca-821476359212","block_type":"box","text":"independent board leader. This director may chair the board, or, where the chair is also the CEO (or is otherwise not","page_number":208,"box":{"x":70,"y":428,"width":827,"height":11}},{"id":"d0fe1eb7-25b9-4ea5-b9d9-394de2e99a6f","block_type":"box","text":"independent), be designated as a lead independent director. The role of this director is to support independent board","page_number":208,"box":{"x":70,"y":443,"width":835,"height":11}},{"id":"7825fd1d-88b1-484e-ab24-86b8f9a15ef2","block_type":"box","text":"members in fulfilling their oversight responsibilities effectively by shaping the agenda, ensuring adequate information","page_number":208,"box":{"x":69,"y":458,"width":834,"height":11}},{"id":"eafd0b70-a3ea-4408-8cc3-cbf32ea7b56c","block_type":"box","text":"is provided to the board, and encouraging independent director participation in board deliberations. We appreciate","page_number":208,"box":{"x":70,"y":473,"width":813,"height":11}},{"id":"86202778-557d-4e34-b95c-8e3aac3208c3","block_type":"box","text":"when the lead independent director or another appropriate director is available to meet with shareholders to explain","page_number":208,"box":{"x":68,"y":488,"width":826,"height":11}},{"id":"492564c9-beac-4e54-b77e-a73f30e9c2e0","block_type":"box","text":"and contextualize a company’s approach as a situation warrants.","page_number":208,"box":{"x":69,"y":503,"width":463,"height":11}},{"id":"cd15829d-ab33-49e8-93a8-9f338da9ede4","block_type":"box","text":"Boards may face matters that could involve conflicts of interest for executives or affiliated directors, or that","page_number":208,"box":{"x":102,"y":526,"width":765,"height":11}},{"id":"ba1903fc-65a5-4183-8f22-2375f48262d4","block_type":"box","text":"require additional focus. It is our view that objective oversight of such matters is best achieved when the board forms","page_number":208,"box":{"x":69,"y":541,"width":837,"height":11}},{"id":"0c468638-8152-4eb0-9e3e-2007399141a5","block_type":"box","text":"committees with a majority of independent directors, depending on market norms and a company’s ownership","page_number":208,"box":{"x":69,"y":556,"width":784,"height":11}},{"id":"9c41fc63-aa9f-47a4-949f-1a78bcfca938","block_type":"box","text":"structure. In many markets, these committees of the board specialize in audit, director nominations, and","page_number":208,"box":{"x":69,"y":571,"width":747,"height":11}},{"id":"825d82e8-6840-4066-9f7a-730544049361","block_type":"box","text":"compensation matters, among others. An ad hoc committee might also be formed to decide on a special transaction,","page_number":208,"box":{"x":69,"y":586,"width":836,"height":12}},{"id":"ba108473-e14a-44b2-b5a9-6604cdb262c2","block_type":"box","text":"particularly one involving a related party, or to investigate a significant adverse event.","page_number":208,"box":{"x":70,"y":601,"width":607,"height":12}},{"id":"2a5f3072-816a-4092-a312-1051240c2bd8","block_type":"box","text":"Sufficient capacity","page_number":208,"box":{"x":68,"y":632,"width":137,"height":11}},{"id":"87548d39-38ef-4cab-bda3-b763cff80603","block_type":"box","text":"As the role and expectations of a director are increasingly demanding, directors must be able to commit an","page_number":208,"box":{"x":101,"y":654,"width":763,"height":12}},{"id":"a12c5cfa-a8cd-4c83-8359-54f3c44fad90","block_type":"box","text":"appropriate amount of time to board and committee matters. It is important that directors have the capacity to meet","page_number":208,"box":{"x":69,"y":669,"width":830,"height":12}},{"id":"32623910-6b73-40a0-aadc-33fdd0f3486b","block_type":"box","text":"all of their responsibilities — including when there are unforeseen events — and therefore, we consider it best","page_number":208,"box":{"x":69,"y":685,"width":791,"height":11}},{"id":"9914b6b2-8717-45b6-b64b-906da9d6d7e0","block_type":"box","text":"practice when they don’t take on an excessive number of roles that would impair their ability to fulfill their duties.","page_number":208,"box":{"x":70,"y":700,"width":804,"height":11}},{"id":"011d04d1-14de-4c5d-bc24-88ba199e377c","block_type":"box","text":"Board composition","page_number":208,"box":{"x":69,"y":730,"width":135,"height":11}},{"id":"409096e1-a9c9-4f27-a120-858db86fffac","block_type":"box","text":"In assessing board composition, we take into account a company’s board size, business model, strategy, market","page_number":208,"box":{"x":102,"y":753,"width":806,"height":11}},{"id":"db32a600-c45f-4eca-88e2-c4a8c533cdf9","block_type":"box","text":"capitalization, and ownership structure, as well as the market in which the company operates. We find it helpful when","page_number":208,"box":{"x":69,"y":768,"width":836,"height":11}},{"id":"128f88d3-278a-411d-9bca-e7755dc38382","block_type":"box","text":"companies explain how their approach to board composition supports the company’s governance practices.","page_number":208,"box":{"x":69,"y":783,"width":767,"height":11}},{"id":"def97d77-fa25-47a4-93a3-2b82cc79b3f0","block_type":"box","text":"When nominating directors to the board, we look to companies to provide sufficient information on the individual","page_number":208,"box":{"x":101,"y":806,"width":802,"height":11}},{"id":"1c738e1a-40f8-4ba6-8285-bba6fd4a06a6","block_type":"box","text":"candidates so that shareholders can assess the capabilities and suitability of each individual nominee and their fit","page_number":208,"box":{"x":69,"y":821,"width":818,"height":11}},{"id":"9923cadd-5db3-4138-9945-cea11a28eea2","block_type":"box","text":"within overall board composition. These disclosures should explain how the collective experience and expertise of the","page_number":208,"box":{"x":68,"y":836,"width":840,"height":11}},{"id":"0dd2a4ca-ef04-4c2e-a6a8-b2b7db58cca3","block_type":"box","text":"board, as well as the particular skillsets of individual directors, aligns with the company’s long-term strategy. Highly","page_number":208,"box":{"x":69,"y":851,"width":823,"height":11}},{"id":"ab84fcde-f590-4d12-870f-1fce6ab7610c","block_type":"box","text":"6","page_number":208,"box":{"x":69,"y":881,"width":4,"height":4}},{"id":"6aaa1089-5d7d-407e-b062-60344510667f","block_type":"box","text":"For example, please see: Tokyo Stock Exchange, “Japan’s Corporate Governance Code,” June 11, 2021; Financial","page_number":208,"box":{"x":79,"y":880,"width":813,"height":11}},{"id":"aeacc2fd-cda4-47ae-ac94-a7e857b320cd","block_type":"box","text":"Reporting Council, “UK Corporate Governance Code,” January 2024, accessed in December 2025.","page_number":208,"box":{"x":70,"y":895,"width":704,"height":12}},{"id":"2b0093e3-222d-44a9-91a5-fac0114f1c67","block_type":"box","text":"BlackRock Investment Stewardship","page_number":208,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"8b73a6a7-d6b1-44d1-ab47-c5f1878a7b04","block_type":"box","text":"Global Principles | 6","page_number":208,"box":{"x":768,"y":942,"width":141,"height":13}},{"id":"2bea35eb-71b9-425e-997c-467b29c516fe","block_type":"box","text":"NM0926U-5977317-208/232","page_number":208,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"2b6ec608-a1e0-4ea8-a319-fd4cc085d67b","block_type":"box","text":"qualified, engaged directors with professional characteristics relevant to a company’s business and strategy enhance","page_number":209,"box":{"x":69,"y":45,"width":836,"height":11}},{"id":"ac2d22fc-3747-4da0-adcd-09bc5f10f716","block_type":"box","text":"the ability of the board to add value and be the voice of shareholders in board discussions.","page_number":209,"box":{"x":68,"y":60,"width":650,"height":11}},{"id":"bfaf87fa-4bd7-4ddf-b7be-d57b9841bf9d","block_type":"box","text":"It is in this context that we are interested in a variety of experiences, perspectives, and skillsets in the board","page_number":209,"box":{"x":102,"y":82,"width":775,"height":12}},{"id":"b6e2c15a-897e-45db-bc30-a6daa54c5068","block_type":"box","text":"room. We see it as a means of avoiding “group think” in the board’s exercise of its responsibilities to advise and","page_number":209,"box":{"x":69,"y":98,"width":806,"height":11}},{"id":"6fc9a060-39d9-4390-9162-33c939329740","block_type":"box","text":"oversee management. We note that in many markets, policymakers have set board gender diversity goals which we","page_number":209,"box":{"x":69,"y":113,"width":820,"height":11}},{"id":"4fa5a758-50d8-40fb-afef-d459439ed31a","block_type":"box","text":"may discuss with companies, particularly if there is a risk their board composition may be misaligned.","page_number":209,"box":{"x":69,"y":128,"width":726,"height":11}},{"id":"1374e281-c355-4aa1-8f85-bee7f6e75ab2","block_type":"box","text":"AUDITORS AND AUDIT-RELATED ISSUES","page_number":209,"box":{"x":342,"y":158,"width":293,"height":9}},{"id":"0b9f1132-49dc-4a33-a029-c3b5b288c4ce","block_type":"box","text":"BIS recognizes the critical importance of financial statements to provide a complete and accurate portrayal of a","page_number":209,"box":{"x":102,"y":181,"width":795,"height":11}},{"id":"a7cd14ec-b93f-4c0f-8995-e87f05f5ef3b","block_type":"box","text":"company’s financial condition. Accordingly, we look for the assumptions made by management, and reviewed by the","page_number":209,"box":{"x":69,"y":196,"width":825,"height":11}},{"id":"8218c546-b276-474b-893b-f4929cf7aa24","block_type":"box","text":"auditor in preparing the financial statements, to be reasonable and justified.","page_number":209,"box":{"x":69,"y":211,"width":543,"height":11}},{"id":"df23b327-e9df-4bfa-89d1-47802ba5b1dd","block_type":"box","text":"We view the audit committee, or its equivalent, as responsible for overseeing the management of the","page_number":209,"box":{"x":101,"y":234,"width":722,"height":11}},{"id":"3acc99b6-c086-4f0f-a365-c2345e1daa70","block_type":"box","text":"independent auditor and the internal audit function at a company. The committee plays an important role in a","page_number":209,"box":{"x":70,"y":249,"width":778,"height":11}},{"id":"7dbe22c9-6dfd-4131-9acc-5dcd778f3eef","block_type":"box","text":"company’s financial reporting system by providing independent oversight of the accounts, material financial, and,","page_number":209,"box":{"x":69,"y":264,"width":806,"height":11}},{"id":"4461f68c-12a5-4a73-922d-25ff80538b64","block_type":"box","text":"where appropriate to the jurisdiction, non-financial information and internal control frameworks. Moreover, in the","page_number":209,"box":{"x":68,"y":279,"width":799,"height":11}},{"id":"e5c31585-ea68-4c80-b4c4-9e17a9c89b2f","block_type":"box","text":"absence of a dedicated risk committee, these committees can provide oversight of Enterprise Risk Management","page_number":209,"box":{"x":69,"y":294,"width":801,"height":11}},{"id":"aa643dd3-ff44-48e9-bee2-c54747f981e3","block_type":"box","text":"systems.","page_number":209,"box":{"x":69,"y":310,"width":62,"height":10}},{"id":"9589a05a-9552-4504-903b-f7d9d9420f2d","block_type":"box","text":"7","page_number":209,"box":{"x":133,"y":310,"width":4,"height":4}},{"id":"2111210b-2ac4-46ea-9d08-a2d9cbbfb8b5","block_type":"box","text":"In our view, effective audit committee oversight strengthens the quality and reliability of a company’s","page_number":209,"box":{"x":144,"y":309,"width":717,"height":11}},{"id":"8fbab7f1-ce3b-42dc-b10e-749f692bd35e","block_type":"box","text":"financial statements and provides an important level of reassurance to shareholders.","page_number":209,"box":{"x":68,"y":324,"width":609,"height":11}},{"id":"30db03ee-7c33-47d9-91e9-54493e93b569","block_type":"box","text":"We look to audit committees, or their equivalent, to have clearly articulated charters that set out their","page_number":209,"box":{"x":101,"y":347,"width":727,"height":11}},{"id":"58ba9d3d-15ad-45ff-8829-b8c658fc5c6d","block_type":"box","text":"responsibilities. Additionally, having a rotation plan can periodically refresh the committee membership and introduce","page_number":209,"box":{"x":69,"y":362,"width":835,"height":11}},{"id":"15cb9eac-df87-4b46-9efb-167cbc2efbc6","block_type":"box","text":"new perspectives. We recognize that audit committees will rely on management, internal audit, and the independent","page_number":209,"box":{"x":69,"y":377,"width":827,"height":12}},{"id":"d8ff2626-c042-4764-a617-ebfbb9efd6ee","block_type":"box","text":"auditor to fulfill their responsibilities. However, we look to committee members to demonstrate they have relevant","page_number":209,"box":{"x":69,"y":392,"width":810,"height":12}},{"id":"53560adc-1437-4bf9-9a3f-8faa2c030558","block_type":"box","text":"expertise to monitor and oversee the audit process and related activities.","page_number":209,"box":{"x":69,"y":408,"width":523,"height":10}},{"id":"b6b62837-dde6-4331-b88f-cb7f43250889","block_type":"box","text":"We take particular note of unexplained changes in reporting methodology, cases involving significant financial","page_number":209,"box":{"x":101,"y":430,"width":780,"height":11}},{"id":"1ee01697-407a-4005-ab4f-ee932021e156","block_type":"box","text":"restatements, or ad hoc notifications of material financial weakness. In this respect, we look to audit committees to","page_number":209,"box":{"x":69,"y":445,"width":828,"height":11}},{"id":"01da117f-31bb-446c-8b3a-65b5a7cbfeca","block_type":"box","text":"provide timely disclosure on the remediation of key and critical audit matters identified either by the external auditor","page_number":209,"box":{"x":70,"y":460,"width":827,"height":12}},{"id":"951e3065-11ac-49b7-91bc-651abc93bdfb","block_type":"box","text":"or internal audit function.","page_number":209,"box":{"x":69,"y":475,"width":178,"height":9}},{"id":"cff1491d-ddfe-4d6f-baf9-0feaa6d99971","block_type":"box","text":"The integrity of financial statements depends on the auditor being free of any impediments that could","page_number":209,"box":{"x":101,"y":498,"width":723,"height":11}},{"id":"5bdf9ade-b88e-46d4-9acb-de4ffe2675e1","block_type":"box","text":"compromise its ability to serve as an effective check on management. To that end, it is important that auditors are,","page_number":209,"box":{"x":69,"y":513,"width":825,"height":12}},{"id":"a8aa1bc0-fdff-4f48-829c-1a7be7412e6b","block_type":"box","text":"and are seen to be, independent. Where an audit firm provides services to the company in addition to the audit, we","page_number":209,"box":{"x":69,"y":528,"width":824,"height":12}},{"id":"8edc01f7-0fbc-4ab9-903e-0e69093d59e1","block_type":"box","text":"look for the fees earned to be disclosed and explained. We look for audit committees to have in place a procedure for","page_number":209,"box":{"x":70,"y":543,"width":839,"height":11}},{"id":"4c3cc827-16e5-4fbc-9434-b20425f76696","block_type":"box","text":"assessing the independence of the auditor and the quality of the external audit process on an annual basis.","page_number":209,"box":{"x":69,"y":559,"width":770,"height":11}},{"id":"8485121a-f0ac-4c59-9f7f-f46807349073","block_type":"box","text":"Comprehensive disclosure provides investors with an understanding of the company’s long-term operational risk","page_number":209,"box":{"x":102,"y":581,"width":799,"height":12}},{"id":"4d384794-1313-4d5d-bc6b-8d14827bcab9","block_type":"box","text":"management practices and, more broadly, the quality of the board’s oversight. We look to the audit or risk committee","page_number":209,"box":{"x":69,"y":596,"width":836,"height":12}},{"id":"13803475-4e95-4ee4-a043-9590ffed2f52","block_type":"box","text":"to periodically review the company’s risk assessment and risk management policies and the significant risks and","page_number":209,"box":{"x":68,"y":612,"width":806,"height":11}},{"id":"30800059-6db8-4186-8bb4-81c41112bed7","block_type":"box","text":"exposures identified by management, the internal auditors or the independent auditors, and management’s steps to","page_number":209,"box":{"x":69,"y":627,"width":829,"height":11}},{"id":"2b371f32-d989-4995-9168-5cb81cb8a1e7","block_type":"box","text":"address them. In the absence of detailed disclosures, we may conclude that companies are not adequately managing","page_number":209,"box":{"x":69,"y":642,"width":840,"height":11}},{"id":"f73fe0c4-45d7-45cc-a841-aba1c3ae53ac","block_type":"box","text":"risk.","page_number":209,"box":{"x":69,"y":657,"width":28,"height":9}},{"id":"3f2c1a40-4609-4146-aab5-925305664355","block_type":"box","text":"CAPITAL STRUCTURE, MERGERS, ACQUISITIONS, ASSET SALES, AND OTHER SPECIAL SITUATIONS","page_number":209,"box":{"x":125,"y":687,"width":728,"height":11}},{"id":"22aa6e2d-1991-45bb-a95b-0fa6688684d2","block_type":"box","text":"The capital structure of a company is critical to shareholders as it impacts the value of their investment and the","page_number":209,"box":{"x":101,"y":710,"width":798,"height":11}},{"id":"eef5e554-60ec-4095-90eb-74f278e7eea6","block_type":"box","text":"priority of their interest in the company relative to that of other equity or debt investors. Pre-emptive rights are a key","page_number":209,"box":{"x":70,"y":725,"width":824,"height":11}},{"id":"f2d59dd9-f60d-42bf-a9f7-6d643489b505","block_type":"box","text":"protection for shareholders against the dilution of their interests.","page_number":209,"box":{"x":70,"y":740,"width":460,"height":11}},{"id":"96878222-06a8-44a1-ae67-ed5f9fb695a1","block_type":"box","text":"In principle, we have concerns with the creation of a share class with equivalent economic exposure and","page_number":209,"box":{"x":102,"y":763,"width":743,"height":11}},{"id":"69c89746-8bbe-4243-a24e-d2e351cd76d1","block_type":"box","text":"differentiated voting rights. As a result, BIS generally supports bylaw amendments that introduce the adoption of","page_number":209,"box":{"x":69,"y":778,"width":805,"height":11}},{"id":"c0bfdc2a-8aba-410b-8c95-797c9cd4d7ee","block_type":"box","text":"“one share, one vote” for registered shareholders.","page_number":209,"box":{"x":70,"y":793,"width":358,"height":11}},{"id":"ab884188-517e-4b38-be31-801451f57e98","block_type":"box","text":"7","page_number":209,"box":{"x":69,"y":823,"width":4,"height":4}},{"id":"d6a69bda-b030-43c7-9e77-8633fe19337d","block_type":"box","text":"Enterprise Risk Management is a process, effected by the entity’s board of directors, management, and other","page_number":209,"box":{"x":79,"y":822,"width":784,"height":12}},{"id":"36c09642-98b0-449f-85a7-0b1b41f3175c","block_type":"box","text":"personnel, applied in strategy setting and across the enterprise, designed to identify potential events that may affect","page_number":209,"box":{"x":70,"y":837,"width":834,"height":12}},{"id":"9253a10c-00bd-4860-bf3b-8ad4aed46050","block_type":"box","text":"the entity, and manage risk to be within the risk appetite, to provide reasonable assurance regarding the achievement","page_number":209,"box":{"x":68,"y":853,"width":841,"height":11}},{"id":"d5fe4068-408a-40ae-a999-e1fa4c26abeb","block_type":"box","text":"of objectives. Please see: The Committee of Sponsoring Organizations of the Treadway Commission (COSO),","page_number":209,"box":{"x":69,"y":868,"width":771,"height":11}},{"id":"cfa5b5a2-8a1d-41fc-9782-01763bf1cdbd","block_type":"box","text":"“Enterprise Risk Management,” 2023, accessed in December 2025.","page_number":209,"box":{"x":70,"y":883,"width":488,"height":11}},{"id":"d0ba7b4a-949e-4ce6-a613-ba9802f431d8","block_type":"box","text":"BlackRock Investment Stewardship","page_number":209,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"b17989ec-f122-42c8-8d13-be5010874e9c","block_type":"box","text":"Global Principles | 7","page_number":209,"box":{"x":768,"y":942,"width":140,"height":13}},{"id":"0a1643f7-9164-470f-9485-c07b90d26c7a","block_type":"box","text":"NM0926U-5977317-209/232","page_number":209,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"d8b36976-4bcc-4c19-a1db-9bd30e8611ec","block_type":"box","text":"However, we recognize that in certain markets, at least for a period of time, companies may have a valid reason","page_number":210,"box":{"x":102,"y":45,"width":798,"height":11}},{"id":"4e972eea-986f-4996-9d8b-d357b339c860","block_type":"box","text":"for listing dual classes of shares with differentiated voting rights. In our view, such companies should review these","page_number":210,"box":{"x":68,"y":60,"width":818,"height":11}},{"id":"7efa40fe-23d3-4f48-b03f-93a6d25a3698","block_type":"box","text":"share class structures on a regular basis or as company circumstances change. Additionally, they should seek","page_number":210,"box":{"x":69,"y":75,"width":788,"height":11}},{"id":"bf58892d-0f3e-4d0d-ab2e-78d1e180af6d","block_type":"box","text":"shareholder approval of their capital structure on a periodic basis via a management proposal at the company’s","page_number":210,"box":{"x":69,"y":90,"width":797,"height":11}},{"id":"515f9ca0-e207-402c-8e51-2795a21ad5b0","block_type":"box","text":"shareholder meeting. The proposal should give unaffiliated shareholders the opportunity to affirm the current","page_number":210,"box":{"x":69,"y":105,"width":780,"height":11}},{"id":"55ffae84-4926-45b8-8510-c0a9cbabf325","block_type":"box","text":"structure or establish mechanisms to end or phase out controlling structures at the appropriate time, while","page_number":210,"box":{"x":69,"y":120,"width":764,"height":12}},{"id":"46dc1a46-b3e8-4bc3-bebe-acc9d210fda9","block_type":"box","text":"minimizing costs to shareholders.","page_number":210,"box":{"x":69,"y":136,"width":238,"height":11}},{"id":"31786380-fba1-435f-8103-b8e082239081","block_type":"box","text":"In assessing mergers, asset sales, or other special situations, BIS’ primary consideration is the long-term","page_number":210,"box":{"x":102,"y":158,"width":756,"height":11}},{"id":"406e7c11-3f72-46f1-afa1-1d3567a3c900","block_type":"box","text":"financial interests of our clients as shareholders, and so we will review any proposed transaction with that objective","page_number":210,"box":{"x":68,"y":173,"width":826,"height":11}},{"id":"b51d62f1-1be4-4fed-9cbc-331e75b8fec0","block_type":"box","text":"in mind. Typically, we review factors such as whether the proposed transaction has the unanimous support of the","page_number":210,"box":{"x":70,"y":188,"width":806,"height":11}},{"id":"72070481-a1f5-4d32-970f-7924ca284eb3","block_type":"box","text":"board and has been negotiated at arm’s length, and whether the board or management has clearly explained its","page_number":210,"box":{"x":69,"y":204,"width":799,"height":11}},{"id":"3a80ad08-f5e0-47f5-84f8-66ebb54608cb","block_type":"box","text":"economic and strategic rationale. We may also seek reassurance from the board that the financial interests of","page_number":210,"box":{"x":69,"y":218,"width":788,"height":12}},{"id":"fe496398-c22a-4587-8dd6-d8909b241312","block_type":"box","text":"executives and/or board members in a given transaction have not adversely affected their ability to place","page_number":210,"box":{"x":69,"y":234,"width":750,"height":11}},{"id":"260a3af8-f2f7-4431-829d-a51e0cd59c0a","block_type":"box","text":"shareholders’ interests before their own. Where the transaction involves related parties, the recommendation to","page_number":210,"box":{"x":69,"y":249,"width":801,"height":11}},{"id":"60c46f5a-185f-44a2-97d3-dbd6653abc60","block_type":"box","text":"support should come from the independent directors, a best practice in most markets, and ideally, the terms should","page_number":210,"box":{"x":69,"y":264,"width":830,"height":11}},{"id":"430add1e-cea4-4c5c-903b-7d66e4b3ef52","block_type":"box","text":"have been assessed through an independent appraisal process. In addition, it is good practice that it be approved by","page_number":210,"box":{"x":69,"y":279,"width":836,"height":11}},{"id":"1db10168-6f1b-4243-b026-e57e2b3089c7","block_type":"box","text":"a separate vote of the non-conflicted parties.","page_number":210,"box":{"x":69,"y":294,"width":320,"height":11}},{"id":"ea7f73f9-add5-4610-b224-fa765c4c34f9","block_type":"box","text":"As a matter of sound governance practice, shareholders should have a right to dispose of company shares in the","page_number":210,"box":{"x":101,"y":317,"width":806,"height":11}},{"id":"73fccffa-a0c1-4bfb-86b8-f2c3c086d1c1","block_type":"box","text":"open market without unnecessary restriction. In our view, corporate mechanisms designed to limit shareholders’","page_number":210,"box":{"x":69,"y":332,"width":801,"height":11}},{"id":"27ac4acd-1604-494d-a149-a4c77bbb4d0a","block_type":"box","text":"ability to sell their shares are contrary to basic property rights. Such mechanisms can serve to protect and entrench","page_number":210,"box":{"x":69,"y":347,"width":829,"height":11}},{"id":"424e6743-96ee-4073-a54a-6d2f961354c8","block_type":"box","text":"interests other than those of the shareholders. In our view, shareholders are broadly capable of making decisions in","page_number":210,"box":{"x":70,"y":362,"width":826,"height":11}},{"id":"9dbedd99-5f28-4d2f-8b7a-4ec1bfc6b779","block_type":"box","text":"their own best interests. We encourage any shareholder rights plans proposed by a board to be subject to","page_number":210,"box":{"x":68,"y":377,"width":755,"height":12}},{"id":"ff45d557-6671-4adb-ab7a-fd4f875b8058","block_type":"box","text":"shareholder approval upon introduction and periodically thereafter.","page_number":210,"box":{"x":69,"y":392,"width":472,"height":12}},{"id":"904acf26-65a5-4e71-8c9e-7627acf3b4f5","block_type":"box","text":"EXECUTIVE COMPENSATION AND BENEFITS","page_number":210,"box":{"x":328,"y":423,"width":322,"height":9}},{"id":"50b7ab82-d288-4f6f-bb43-ca379a5553bc","block_type":"box","text":"Executive compensation is an important tool used by companies to support long-term financial value creation. A","page_number":210,"box":{"x":102,"y":445,"width":799,"height":12}},{"id":"5a598b10-f21d-4d01-8ef9-477a70f54af9","block_type":"box","text":"well-structured compensation policy rewards the successful delivery of strategic, operational, and/or financial goals;","page_number":210,"box":{"x":68,"y":460,"width":830,"height":12}},{"id":"ef32256b-01f8-48ab-993d-6c6329b46e64","block_type":"box","text":"encourages an appropriate risk appetite; and aligns the interests of shareholders and executives through equity","page_number":210,"box":{"x":69,"y":475,"width":797,"height":12}},{"id":"33d030b7-fa04-4b9d-b327-03189ae4edb3","block_type":"box","text":"ownership.","page_number":210,"box":{"x":69,"y":491,"width":75,"height":11}},{"id":"16acd0d8-b491-46a1-8072-53a788103d3c","block_type":"box","text":"8","page_number":210,"box":{"x":146,"y":491,"width":4,"height":4}},{"id":"28e065a0-9c22-44e9-a4ae-a19a387abf56","block_type":"box","text":"We look for a clear link between variable pay and operational and financial performance that support sustained","page_number":210,"box":{"x":101,"y":513,"width":793,"height":11}},{"id":"562b24b9-ce9c-4d51-847a-a18d296d7124","block_type":"box","text":"financial value creation for our clients as shareholders. We appreciate when performance targets incorporate","page_number":210,"box":{"x":68,"y":528,"width":778,"height":12}},{"id":"e40f9829-fd26-4a2e-a71b-9d7a78213c0f","block_type":"box","text":"ambitious objectives, and the corresponding metrics are aligned with the company’s strategy and business model.","page_number":210,"box":{"x":69,"y":544,"width":815,"height":11}},{"id":"a0ae3fce-760f-490e-a428-b5fc91b1f830","block_type":"box","text":"BIS does not have a position on whether companies choose to use sustainability-related criteria in compensation","page_number":210,"box":{"x":70,"y":559,"width":804,"height":11}},{"id":"afcf5abe-4381-417d-911e-9e43254da0b8","block_type":"box","text":"structures, but, where they are included, we look to companies to be as rigorous as they would be in setting other","page_number":210,"box":{"x":69,"y":574,"width":814,"height":11}},{"id":"31133060-845f-45bc-978f-8106aed8424e","block_type":"box","text":"financial or operational targets. We appreciate when long-term incentive plans encompass timeframes that: 1) are","page_number":210,"box":{"x":68,"y":589,"width":813,"height":11}},{"id":"6e8475b6-19ce-498f-9da0-ec0c844c2465","block_type":"box","text":"distinct from annual executive compensation structures and metrics, and 2) encourage the delivery of strong financial","page_number":210,"box":{"x":69,"y":604,"width":839,"height":11}},{"id":"482388ea-afc6-405d-95b5-0c2f311c30ef","block_type":"box","text":"results over a period of years.","page_number":210,"box":{"x":69,"y":619,"width":211,"height":11}},{"id":"961402e5-574a-4390-a0bd-601316c22b55","block_type":"box","text":"We consider it best practice when board members responsible for designing and approving executive","page_number":210,"box":{"x":101,"y":642,"width":718,"height":11}},{"id":"2fe5b6b3-36d1-4850-8b96-3cb083159fbf","block_type":"box","text":"compensation carefully consider the company’s specific circumstances. Factors to consider may include the","page_number":210,"box":{"x":69,"y":657,"width":770,"height":11}},{"id":"0770c35d-4598-4bb0-b627-aec4700be366","block_type":"box","text":"company’s risk profile, the environment it operates in, and the individuals the board is trying to attract and retain. We","page_number":210,"box":{"x":69,"y":672,"width":838,"height":11}},{"id":"4f3cd9a6-d146-4f6f-80a9-892c0882e896","block_type":"box","text":"look to the compensation committees to guard against contractual arrangements that would entitle executives to","page_number":210,"box":{"x":70,"y":687,"width":804,"height":11}},{"id":"a3449305-c677-4b74-85b9-33a6faf3128f","block_type":"box","text":"material compensation for early termination of their employment. Finally, we look for pension contributions and other","page_number":210,"box":{"x":69,"y":702,"width":831,"height":11}},{"id":"d9dfb72a-4cec-43ff-84f8-81b7c7540afb","block_type":"box","text":"deferred compensation arrangements to be reasonable in light of market practices or the company’s business and","page_number":210,"box":{"x":69,"y":717,"width":817,"height":12}},{"id":"a4bdc4ff-b329-4a24-89be-bf6d204d062f","block_type":"box","text":"executive compensation strategies.","page_number":210,"box":{"x":69,"y":733,"width":250,"height":11}},{"id":"4f0e9c12-2296-4f7c-856e-a52aba443764","block_type":"box","text":"We are not supportive of one-off or special bonuses unrelated to company or individual performance. Where","page_number":210,"box":{"x":101,"y":755,"width":772,"height":11}},{"id":"f7fcc22c-a9ce-4804-ac2a-fce37021b5a3","block_type":"box","text":"discretion has been used by the compensation committee, or its equivalent, we appreciate disclosure relating to how","page_number":210,"box":{"x":69,"y":771,"width":836,"height":11}},{"id":"b3a5b5d1-0a86-4ace-9d2a-f68d502772de","block_type":"box","text":"and why the discretion was used, and how the adjusted outcome is aligned with the interests of shareholders. In","page_number":210,"box":{"x":69,"y":785,"width":803,"height":12}},{"id":"8a087468-b99a-4f3d-9bef-c1c93273a559","block_type":"box","text":"addition, we acknowledge that the use of peer group evaluation by compensation committees can help ensure","page_number":210,"box":{"x":69,"y":801,"width":785,"height":11}},{"id":"3c8b19a3-cf00-4cd4-9e95-64beb1b560ec","block_type":"box","text":"competitive pay. However, we encourage companies to clearly explain how compensation outcomes have rewarded","page_number":210,"box":{"x":69,"y":816,"width":815,"height":11}},{"id":"2229a756-1467-4899-aa30-182c67faed71","block_type":"box","text":"performance rather than solely base increases in total compensation on peer benchmarking.","page_number":210,"box":{"x":70,"y":831,"width":659,"height":11}},{"id":"489b6b56-9aae-4c86-a726-8c82abcfd00b","block_type":"box","text":"8","page_number":210,"box":{"x":69,"y":860,"width":4,"height":5}},{"id":"fc76ae44-e3fe-4d87-81ed-773adb2cc9e8","block_type":"box","text":"The terms “compensation,” “remuneration,” and “pay” are used interchangeably to describe the same concept in","page_number":210,"box":{"x":78,"y":860,"width":811,"height":11}},{"id":"54c51df1-36db-4c7b-bd77-90cc57366312","block_type":"box","text":"different markets.","page_number":210,"box":{"x":69,"y":875,"width":126,"height":9}},{"id":"940dccc2-e80f-4730-9150-c01dc6b57e92","block_type":"box","text":"BlackRock Investment Stewardship","page_number":210,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"d88fd33a-dd46-4edd-98b0-44592b4bf88b","block_type":"box","text":"Global Principles | 8","page_number":210,"box":{"x":768,"y":942,"width":141,"height":13}},{"id":"e3c9f4ee-b1b1-4d1e-97f2-c1e64e7642b0","block_type":"box","text":"NM0926U-5977317-210/232","page_number":210,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"e8225d9a-b00d-432e-b851-a225719adfba","block_type":"box","text":"We consider the inclusion of building clawback provisions into incentive plans as good practice. Such provisions","page_number":211,"box":{"x":101,"y":45,"width":797,"height":11}},{"id":"f360468a-5b38-45fe-8037-047bc900c9a7","block_type":"box","text":"could require executives to forgo awards when compensation was based on faulty financial statements or deceptive","page_number":211,"box":{"x":69,"y":60,"width":825,"height":11}},{"id":"6e16a907-940c-427e-ab76-8e8e14b611d9","block_type":"box","text":"business practices, or when their behavior caused material financial harm to shareholders, material reputational risk","page_number":211,"box":{"x":69,"y":75,"width":833,"height":11}},{"id":"60a0de2d-6e9d-4462-94aa-a3b91f274d15","block_type":"box","text":"to the company, or resulted in a criminal investigation.","page_number":211,"box":{"x":68,"y":90,"width":386,"height":11}},{"id":"9f7cf701-f463-468d-b038-891360448d3d","block_type":"box","text":"In our view, non-executive directors should be compensated in a manner that is commensurate with the time and","page_number":211,"box":{"x":102,"y":113,"width":803,"height":11}},{"id":"0ea0b6e0-e933-4ea0-94d4-4209c3066fe5","block_type":"box","text":"effort expended in fulfilling their professional responsibilities. Additionally, these compensation arrangements should","page_number":211,"box":{"x":69,"y":128,"width":834,"height":11}},{"id":"9d3f0a2a-56a9-4168-b443-177d5da2f0ce","block_type":"box","text":"not risk compromising directors’ independence or aligning their interests too closely with those of the management,","page_number":211,"box":{"x":69,"y":143,"width":825,"height":11}},{"id":"03c39a33-e25f-43f0-83e3-df26b567da76","block_type":"box","text":"whom they are charged with overseeing.","page_number":211,"box":{"x":68,"y":158,"width":285,"height":11}},{"id":"e4ec26c8-cdbd-4fa1-9a28-94fe38fb947a","block_type":"box","text":"When assessing compensation proposals, BIS reviews companies’ disclosures to determine whether the board’s","page_number":211,"box":{"x":101,"y":181,"width":807,"height":11}},{"id":"bff66810-74e7-4130-a1e3-c9599f51e53f","block_type":"box","text":"approach to executive compensation is rigorous in light of the company’s stated long-term corporate strategy and","page_number":211,"box":{"x":69,"y":196,"width":807,"height":11}},{"id":"faca037c-bd2e-4201-957b-9f623385f955","block_type":"box","text":"specific circumstances, as well as local market and policy developments.","page_number":211,"box":{"x":69,"y":211,"width":521,"height":11}},{"id":"86ac4516-7c7d-438d-bb25-d89e0ced216d","block_type":"box","text":"When our analysis indicates that executive compensation is misaligned with company performance, BIS may not","page_number":211,"box":{"x":101,"y":234,"width":802,"height":11}},{"id":"8196376f-5cc2-4b59-ada9-fc4fce83a6ad","block_type":"box","text":"support management’s proposals to approve compensation, where they are on the agenda. We may also not support","page_number":211,"box":{"x":69,"y":249,"width":838,"height":11}},{"id":"1fcc0ab8-ecac-48d8-9211-c536e0faa18c","block_type":"box","text":"members of the compensation committee or equivalent board members for poor compensation practices or","page_number":211,"box":{"x":69,"y":264,"width":766,"height":11}},{"id":"d49781d9-a7b4-4d73-9a2c-657924509a0b","block_type":"box","text":"structures.","page_number":211,"box":{"x":69,"y":280,"width":76,"height":8}},{"id":"45d73298-a91d-4737-b25c-d758d420eeed","block_type":"box","text":"SHAREHOLDER PROTECTIONS AND OTHER CORPORATE GOVERNANCE MATTERS","page_number":211,"box":{"x":191,"y":309,"width":595,"height":9}},{"id":"251642a6-f987-4ed7-a7a9-9d8988e455bb","block_type":"box","text":"Corporate form","page_number":211,"box":{"x":69,"y":339,"width":108,"height":11}},{"id":"4ef17e84-498b-443d-b408-55bcf48a48ce","block_type":"box","text":"In our view, it is the responsibility of the board to determine the corporate form that is most appropriate given","page_number":211,"box":{"x":102,"y":362,"width":781,"height":11}},{"id":"65427199-ebc6-44ca-917c-767227e71926","block_type":"box","text":"the company’s purpose and business model.","page_number":211,"box":{"x":68,"y":377,"width":320,"height":11}},{"id":"a8a5b4c1-65b8-4fb6-b221-3a6f036ee8a5","block_type":"box","text":"9","page_number":211,"box":{"x":390,"y":378,"width":4,"height":4}},{"id":"9d308d9e-ebff-4063-9af6-4835cd6dce45","block_type":"box","text":"We look to companies proposing to change their corporate form to a","page_number":211,"box":{"x":399,"y":377,"width":487,"height":12}},{"id":"d5a5fde9-2284-4a30-861a-a5065ca6b597","block_type":"box","text":"public benefit corporation, or similar entity, to put it to a shareholder vote if not already required to do so under","page_number":211,"box":{"x":70,"y":392,"width":791,"height":12}},{"id":"b67a4938-22f4-48f0-b775-e3a8328a9bda","block_type":"box","text":"applicable law. We appreciate when supporting documentation from companies or shareholders proposing to alter the","page_number":211,"box":{"x":69,"y":407,"width":839,"height":12}},{"id":"98b7c4c2-61f1-4d6d-a927-ede55c74f999","block_type":"box","text":"corporate form clearly explains how the interests of shareholders and different stakeholders would be impacted as","page_number":211,"box":{"x":69,"y":423,"width":818,"height":11}},{"id":"e5c4b8a5-0ff9-4da8-b876-3c4b3138e0ad","block_type":"box","text":"well as the accountability and voting mechanisms that would be available to shareholders. We generally support","page_number":211,"box":{"x":68,"y":438,"width":800,"height":11}},{"id":"27926fbc-991a-40de-bfe4-326f5385061f","block_type":"box","text":"management proposals if our analysis indicates that shareholders’ financial interests are adequately protected.","page_number":211,"box":{"x":69,"y":453,"width":796,"height":11}},{"id":"7251d2c5-1c02-408d-ac27-6851560174f7","block_type":"box","text":"Corporate form shareholder proposals are evaluated on a case-by-case basis.","page_number":211,"box":{"x":69,"y":468,"width":552,"height":11}},{"id":"181b90c0-8f35-4692-8c21-455d60a53a84","block_type":"box","text":"SHAREHOLDER PROPOSALS","page_number":211,"box":{"x":385,"y":498,"width":207,"height":9}},{"id":"7fc0ef20-20ef-45e3-b751-a87c75c6c9c7","block_type":"box","text":"In most markets, shareholders can submit proposals to be voted on at a company’s shareholder meeting, as","page_number":211,"box":{"x":102,"y":521,"width":777,"height":11}},{"id":"836e85b1-3342-405d-ba0b-f0ad1254e60f","block_type":"box","text":"long as certain requirements are met. Shareholder proposals span a wide range of topics, including governance","page_number":211,"box":{"x":70,"y":536,"width":796,"height":11}},{"id":"b2b0c9c1-0ccd-446d-80c0-e6c6aaabd0fe","block_type":"box","text":"reforms, capital management, and changes in the management or disclosure of sustainability-related risks. These","page_number":211,"box":{"x":69,"y":551,"width":813,"height":11}},{"id":"4957250c-44fc-4eba-92a0-760a9c5cc1ad","block_type":"box","text":"proposals have a varying degree of relevance for companies across sectors, locations, and business models.","page_number":211,"box":{"x":70,"y":566,"width":779,"height":11}},{"id":"d920788c-5d63-4dee-acf6-043fc6c167cf","block_type":"box","text":"BIS takes a case-by-case approach to voting on shareholder proposals and maintains a singular focus on the","page_number":211,"box":{"x":102,"y":589,"width":775,"height":11}},{"id":"3674ae00-b97c-4417-89f2-4bbc6d4ce828","block_type":"box","text":"proposal’s implications for long-term financial value creation for shareholders. Our analysis considers whether a","page_number":211,"box":{"x":70,"y":604,"width":796,"height":11}},{"id":"d7b0bd2e-ae00-4fcc-bc31-1ef328b58e6b","block_type":"box","text":"shareholder proposal addresses a material risk that may impact a company’s long-term financial performance. BIS","page_number":211,"box":{"x":69,"y":619,"width":818,"height":11}},{"id":"d5c8fda7-1055-4da9-bf84-5396986ccdfa","block_type":"box","text":"may support shareholder proposals that request disclosures that help us, as long-term investors on behalf of our","page_number":211,"box":{"x":69,"y":634,"width":809,"height":12}},{"id":"445aa420-9c1e-458f-9339-e16fc5e365bd","block_type":"box","text":"clients, better understand the material risks and opportunities companies face and how they are managing them,","page_number":211,"box":{"x":69,"y":649,"width":807,"height":12}},{"id":"78cd1f0b-c850-4c27-a010-021c3f620597","block_type":"box","text":"especially where this information is additive given the company’s existing disclosures. We look for consistency","page_number":211,"box":{"x":69,"y":664,"width":787,"height":12}},{"id":"0275a2d5-c806-47b8-b076-9ef7d7bc932e","block_type":"box","text":"between the specific request formally made in the proposal, the supporting documentation, and the proponents’","page_number":211,"box":{"x":69,"y":680,"width":801,"height":11}},{"id":"cac26534-2e71-44a9-85f5-23c1b53bb9db","block_type":"box","text":"other communications on the issues. We also assess the company’s practices and disclosures and the costs and","page_number":211,"box":{"x":69,"y":695,"width":813,"height":11}},{"id":"c786ab71-9485-4536-b742-7b829d968b4c","block_type":"box","text":"benefits to the company of meeting the request made in the proposal. We take into consideration a company’s","page_number":211,"box":{"x":69,"y":710,"width":791,"height":11}},{"id":"beb270cc-93ad-47a3-8c63-f314064e9e3a","block_type":"box","text":"governance practices and disclosures against those of their peers.","page_number":211,"box":{"x":68,"y":725,"width":475,"height":11}},{"id":"eec348cd-301f-4858-bd94-e68a5149c3e3","block_type":"box","text":"BIS does not support shareholder proposals that we view as inconsistent with long-term financial value or that","page_number":211,"box":{"x":102,"y":748,"width":787,"height":11}},{"id":"5734073c-3293-470f-b9f8-8f2e599436ab","block_type":"box","text":"seek to micromanage companies. We take into consideration the legal effect of the proposal, as shareholder","page_number":211,"box":{"x":69,"y":763,"width":778,"height":11}},{"id":"2327915c-759e-4dcd-b771-ef1acefb899b","block_type":"box","text":"proposals may be advisory or legally binding depending on the jurisdiction, while others may make requests that","page_number":211,"box":{"x":70,"y":778,"width":799,"height":11}},{"id":"ead7331d-7dcc-49f2-9ff3-ae6025d79a22","block_type":"box","text":"would be deemed illegal in a given jurisdiction.","page_number":211,"box":{"x":68,"y":793,"width":331,"height":11}},{"id":"9c6f8bbf-9445-4e84-8ced-c40fc1cb1fbf","block_type":"box","text":"In our experience, it is helpful when companies disclose the names of the proponent or organization that has","page_number":211,"box":{"x":102,"y":816,"width":777,"height":11}},{"id":"209a3f31-a629-482a-95b8-45b3def32904","block_type":"box","text":"submitted or advised on the proposal. We recognize that some shareholder proposals bundle topics and/or specific","page_number":211,"box":{"x":69,"y":831,"width":825,"height":11}},{"id":"3870754d-7960-4d2c-ab1a-505c0f120535","block_type":"box","text":"requests. Further, the proponent’s supporting statement may refer to topics that are not directly related to the","page_number":211,"box":{"x":69,"y":846,"width":788,"height":11}},{"id":"cc35cfd2-0df8-4c67-86ce-0360e8262de2","block_type":"box","text":"request made in the proposal. In voting on behalf of clients, we must vote yes or no on the proposal as phrased by","page_number":211,"box":{"x":69,"y":861,"width":820,"height":11}},{"id":"aaea7389-6517-4ddf-b2cf-2f75173fc29d","block_type":"box","text":"the proponent. Therefore, when we vote in support of a proposal, we are not necessarily endorsing every element of","page_number":211,"box":{"x":68,"y":876,"width":831,"height":11}},{"id":"53057e84-f5b4-4d74-8c2d-11071fe19307","block_type":"box","text":"9","page_number":211,"box":{"x":69,"y":906,"width":4,"height":4}},{"id":"bd69571a-c8a6-450d-89fc-b802412678c3","block_type":"box","text":"Corporate form refers to the legal structure by which a business is organized.","page_number":211,"box":{"x":79,"y":905,"width":550,"height":12}},{"id":"257edfca-384c-4361-9e54-9968fb2b5fa3","block_type":"box","text":"BlackRock Investment Stewardship","page_number":211,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"00d24956-7d56-4cc4-aae9-55824749d527","block_type":"box","text":"Global Principles | 9","page_number":211,"box":{"x":768,"y":942,"width":141,"height":13}},{"id":"d8f1b345-0eab-45c8-b740-49c7e99904d9","block_type":"box","text":"NM0926U-5977317-211/232","page_number":211,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"4022f1f5-b669-48cc-8518-66e064b63f86","block_type":"box","text":"the proposal or the reasoning, objectives, or supporting statement of the proponent. We may support a proposal for","page_number":212,"box":{"x":68,"y":45,"width":829,"height":11}},{"id":"0a5cb3ed-01d3-424d-bad5-ac1285af1b30","block_type":"box","text":"different reasons than those put forth by the proponent, when we believe that overall it may advance our clients’","page_number":212,"box":{"x":69,"y":60,"width":802,"height":11}},{"id":"9881e004-223e-4545-aaae-50b785db72c4","block_type":"box","text":"long-term financial interests.","page_number":212,"box":{"x":70,"y":75,"width":201,"height":11}},{"id":"5121563c-90cd-44ee-bd12-48fd93df4d7c","block_type":"box","text":"BlackRock is subject to certain rules, regulations, agency guidance, and contractual agreements that place","page_number":212,"box":{"x":102,"y":98,"width":763,"height":11}},{"id":"a0dcaf5d-40bc-41cd-baf4-cbffc96cf434","block_type":"box","text":"restrictions and limitations on how BlackRock can interact with the companies in which we invest on behalf of our","page_number":212,"box":{"x":69,"y":113,"width":809,"height":11}},{"id":"daca0cda-89cd-437c-845d-5dcecb7b8a9c","block_type":"box","text":"clients. BlackRock does not nominate directors for board elections or submit shareholder proposals to companies.","page_number":212,"box":{"x":69,"y":128,"width":817,"height":11}},{"id":"3dc97c41-3fea-427d-843a-76c20c4f50af","block_type":"box","text":"Non-compliance with these requirements could adversely affect BlackRock’s ability to serve its clients’ interests.","page_number":212,"box":{"x":70,"y":143,"width":803,"height":11}},{"id":"1e9cb030-adfe-46fa-9037-3af6d3ab3e05","block_type":"box","text":"MATERIAL SUSTAINABILITY-RELATED RISKS AND OPPORTUNITIES","page_number":212,"box":{"x":247,"y":173,"width":484,"height":9}},{"id":"0e8cb0f6-779e-410c-9bc1-64515c27c2ed","block_type":"box","text":"Appropriate oversight of material risks and opportunities, including material sustainability-related risks and","page_number":212,"box":{"x":101,"y":196,"width":760,"height":11}},{"id":"c12f08f0-4769-4821-a181-5b8d56033254","block_type":"box","text":"opportunities, is an important component of having an effective governance framework that supports durable, long","page_number":212,"box":{"x":69,"y":211,"width":824,"height":11}},{"id":"acb58cb7-c784-496e-8c4b-7bbef42036b8","block_type":"box","text":"term financial value creation.","page_number":212,"box":{"x":68,"y":226,"width":206,"height":9}},{"id":"48d46233-68f2-473f-bd9c-3758cdfe6b61","block_type":"box","text":"10","page_number":212,"box":{"x":276,"y":226,"width":9,"height":5}},{"id":"b86773b0-f72c-4cac-9325-ec5e3b54a61d","block_type":"box","text":"We look to companies to provide robust disclosure that allows investors to effectively evaluate companies’","page_number":212,"box":{"x":101,"y":249,"width":761,"height":11}},{"id":"2cb20126-ec00-4c04-8e59-b904116a3bd8","block_type":"box","text":"strategy and business practices related to material sustainability-related risks and opportunities. We find it helpful","page_number":212,"box":{"x":69,"y":264,"width":814,"height":11}},{"id":"051aaab9-06db-431c-816b-8f9f48033a5c","block_type":"box","text":"when companies’ disclosures demonstrate that they have a resilient business model that integrates material","page_number":212,"box":{"x":68,"y":279,"width":777,"height":11}},{"id":"e007980f-0cf9-4bbf-8a84-16775a2f33c5","block_type":"box","text":"sustainability-related risks and opportunities into their strategy, risk management, and metrics and targets, including","page_number":212,"box":{"x":69,"y":294,"width":833,"height":11}},{"id":"a47b01f4-aff1-45cb-8986-f7820e68ed16","block_type":"box","text":"industry-specific metrics.","page_number":212,"box":{"x":70,"y":309,"width":175,"height":11}},{"id":"59abc3a7-31a3-4509-8ad1-9f2332b96e7f","block_type":"box","text":"Standardized disclosure of sustainability-related data supports investors in making informed decisions. The","page_number":212,"box":{"x":102,"y":332,"width":765,"height":11}},{"id":"ca934873-35d5-4e1a-901e-d6c8cb8af4a8","block_type":"box","text":"International Sustainability Standards Board (ISSB) standards, IFRS S1 and S2, represent one such approach to","page_number":212,"box":{"x":70,"y":347,"width":800,"height":11}},{"id":"d652128c-0791-4698-91bb-87e8e50e95d6","block_type":"box","text":"standardization that we find useful in our analysis.","page_number":212,"box":{"x":69,"y":362,"width":358,"height":11}},{"id":"faaa39a0-bc36-438f-9b52-44e0832380db","block_type":"box","text":"11","page_number":212,"box":{"x":429,"y":363,"width":9,"height":4}},{"id":"56e123f8-2415-46df-ab56-e4260d5811fa","block_type":"box","text":"However, we do not mandate any specific disclosure framework","page_number":212,"box":{"x":444,"y":362,"width":451,"height":11}},{"id":"4c0b6269-123e-432f-8f3f-c810df91c9d9","block_type":"box","text":"companies should use, and recognize that companies may report using different standards, some of which may be","page_number":212,"box":{"x":69,"y":377,"width":821,"height":12}},{"id":"48f89e17-1fa1-47c2-b055-a64343ac35ad","block_type":"box","text":"required by regulation. In such cases, we ask that companies highlight the metrics that are industry- or company","page_number":212,"box":{"x":69,"y":393,"width":806,"height":11}},{"id":"bec046b5-2c06-4aa3-bbd3-97c681bdfb6b","block_type":"box","text":"specific.","page_number":212,"box":{"x":69,"y":407,"width":57,"height":11}},{"id":"82106815-2df0-4d44-9bef-d8943c509fce","block_type":"box","text":"We also recognize that companies may be phasing in reporting over several years. We do not prescribe timelines","page_number":212,"box":{"x":101,"y":430,"width":805,"height":11}},{"id":"c489b865-866e-416e-bbe0-fc3c7ba0ca26","block_type":"box","text":"regarding when companies should make sustainability-related disclosures but appreciate it when companies produce","page_number":212,"box":{"x":69,"y":446,"width":833,"height":11}},{"id":"7bc6e18a-8c35-4f85-887f-95323bb33516","block_type":"box","text":"them sufficiently in advance of their shareholder meeting, to the best of their abilities, to provide investors with time","page_number":212,"box":{"x":68,"y":460,"width":830,"height":12}},{"id":"cda6978a-24f3-4e05-8ac5-27a2b8f965bd","block_type":"box","text":"to assess the data and make informed voting decisions.","page_number":212,"box":{"x":68,"y":475,"width":401,"height":12}},{"id":"9e801b02-6dc1-4b12-b1d3-37027e04a130","block_type":"box","text":"Industry initiatives on managing specific operational risks may also provide useful guidance to companies on","page_number":212,"box":{"x":102,"y":498,"width":775,"height":11}},{"id":"fdf5558d-61f2-4d28-9e38-33d557f42f14","block_type":"box","text":"best practices and disclosures. While not a voting item, we find it helpful to our understanding of investment risk","page_number":212,"box":{"x":69,"y":513,"width":804,"height":12}},{"id":"2995ceae-6ce6-491e-8741-3966cc76d753","block_type":"box","text":"when companies disclose any relevant global sustainability-related standards adopted, the industry initiatives in","page_number":212,"box":{"x":68,"y":529,"width":799,"height":11}},{"id":"cbadf93c-4000-4ded-bf4c-dbd63671e354","block_type":"box","text":"which they participate, any peer group benchmarking undertaken, and any assurance processes to help investors","page_number":212,"box":{"x":68,"y":544,"width":810,"height":11}},{"id":"e081b764-1e64-4877-96ab-9b9f8af687d9","block_type":"box","text":"understand their approach to sustainable and responsible business practices.","page_number":212,"box":{"x":69,"y":559,"width":556,"height":11}},{"id":"f128d88c-3075-40d1-80a1-4b75055dced1","block_type":"box","text":"10","page_number":212,"box":{"x":69,"y":603,"width":9,"height":5}},{"id":"1879716c-0fd6-4f7b-bc2d-8180e09eefcf","block_type":"box","text":"By material sustainability-related risks and opportunities, we mean the drivers of risk and financial value creation in","page_number":212,"box":{"x":84,"y":603,"width":822,"height":11}},{"id":"381e3af0-6050-4c35-8c90-3c263f457e9c","block_type":"box","text":"a company’s business model that have an environmental or social dependency or impact. 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Examples of social","page_number":212,"box":{"x":70,"y":633,"width":827,"height":12}},{"id":"3297c4c0-368b-48fb-8ed4-e111b9ef3c11","block_type":"box","text":"issues include, but are not limited to, human capital management, impacts on the communities in which a company","page_number":212,"box":{"x":70,"y":649,"width":826,"height":11}},{"id":"a0f536a9-121e-499c-a02d-a31344fac613","block_type":"box","text":"operates, customer loyalty, and relationships with regulators.","page_number":212,"box":{"x":69,"y":664,"width":433,"height":11}},{"id":"9c74f1a0-eb45-4f00-89a9-a142f0f89e56","block_type":"box","text":"11","page_number":212,"box":{"x":69,"y":682,"width":9,"height":4}},{"id":"de87c728-e7a6-4c1d-ad00-5e8a1e350a78","block_type":"box","text":"The ISSB is an independent standard-setting body within the International Financial Reporting Standards","page_number":212,"box":{"x":83,"y":681,"width":744,"height":11}},{"id":"0fa89296-33e4-46c9-963c-62704dfeb678","block_type":"box","text":"(IFRS) Foundation. The standards build on the Task Force on Climate-related Financial Disclosures (TCFD) framework","page_number":212,"box":{"x":69,"y":696,"width":828,"height":11}},{"id":"6ec12664-bafe-4858-8bfa-c4da0f953811","block_type":"box","text":"and the standards and metrics developed by the Sustainability Accounting Standards Board (SASB), which have both","page_number":212,"box":{"x":69,"y":711,"width":830,"height":12}},{"id":"3b3626ea-ed6b-4b9b-bbae-b058e4afbac1","block_type":"box","text":"converged under the ISSB. Please refer to the IFRS website to learn more about the framework and standards S1","page_number":212,"box":{"x":69,"y":726,"width":809,"height":12}},{"id":"5e1d5274-123e-4ddb-9502-7df3ca6c213a","block_type":"box","text":"“General Requirements for Disclosure of Sustainability-related Financial Information” and S2 “Climate-related","page_number":212,"box":{"x":70,"y":742,"width":778,"height":11}},{"id":"b3fc016b-edf4-437a-8bc4-8a771666de0f","block_type":"box","text":"Disclosures.” Websites accessed in December 2025.","page_number":212,"box":{"x":70,"y":757,"width":380,"height":9}},{"id":"f4d312fa-4e99-49b9-baf0-6275a216691e","block_type":"box","text":"BlackRock Investment Stewardship","page_number":212,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"270df17f-e41f-4e10-843c-bca4901c168c","block_type":"box","text":"Global Principles | 10","page_number":212,"box":{"x":758,"y":942,"width":151,"height":13}},{"id":"6afbd1c6-72ed-422e-af1b-0def23b773cb","block_type":"box","text":"NM0926U-5977317-212/232","page_number":212,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"9eb302dc-112c-476c-8bd6-840fbdce4b27","block_type":"box","text":"CLIMATE AND NATURE-RELATED RISK","page_number":213,"box":{"x":351,"y":45,"width":277,"height":9}},{"id":"12534beb-1bbe-4c54-ae5d-d2dc308ca7da","block_type":"box","text":"Many companies are assessing how to navigate the low-carbon transition while delivering long-term financial","page_number":213,"box":{"x":102,"y":67,"width":769,"height":12}},{"id":"c81ab9e1-07af-4823-a273-87d6038c2a8a","block_type":"box","text":"value to investors. For companies facing material climate-related risks, we find it helpful when they publicly disclose,","page_number":213,"box":{"x":68,"y":82,"width":829,"height":12}},{"id":"249a2bdd-e01a-471b-9277-f62a216838f2","block_type":"box","text":"consistent with their business model and sector, how they intend to deliver long-term financial performance through","page_number":213,"box":{"x":69,"y":98,"width":824,"height":11}},{"id":"e86132f2-fb64-44be-947e-6734ce1b2be8","block_type":"box","text":"the low-carbon transition, including where available, their transition plan.","page_number":213,"box":{"x":68,"y":113,"width":514,"height":11}},{"id":"4f71b2da-8d66-473d-bc08-09b6ffee40a5","block_type":"box","text":"12, 13","page_number":213,"box":{"x":584,"y":113,"width":26,"height":5}},{"id":"83bc1dee-ce20-4241-9ee9-e4a6af1c2451","block_type":"box","text":"From company disclosures and","page_number":213,"box":{"x":617,"y":113,"width":218,"height":11}},{"id":"d369ea0e-306f-484a-b806-1d18c16110d7","block_type":"box","text":"engagement, we seek to understand the strategies companies have in place to manage material risks to, and","page_number":213,"box":{"x":69,"y":128,"width":782,"height":11}},{"id":"a6712083-704c-48f0-a327-8303228ce26e","block_type":"box","text":"opportunities for, their long-term business model associated with a range of climate-related scenarios.","page_number":213,"box":{"x":69,"y":143,"width":729,"height":11}},{"id":"aa752ff3-accc-4a7e-84c1-9cc7a19a5799","block_type":"box","text":"Recognizing the value of these disclosures, certain markets such as the European Union mandate large","page_number":213,"box":{"x":102,"y":166,"width":740,"height":11}},{"id":"ccb43b31-e9bd-4034-8c43-4799acdf5705","block_type":"box","text":"companies to disclose such climate-related financial information, while in other jurisdictions these disclosures are","page_number":213,"box":{"x":69,"y":181,"width":814,"height":11}},{"id":"4e82f08e-2caf-4a69-95af-5db70186924c","block_type":"box","text":"viewed as best practice in the market.","page_number":213,"box":{"x":68,"y":196,"width":271,"height":11}},{"id":"2eb99a58-54a3-4f7c-9098-6da4debb9dc6","block_type":"box","text":"The ISSB standards provide one such framework that can assist investors in assessing company-specific","page_number":213,"box":{"x":101,"y":218,"width":749,"height":12}},{"id":"073948e9-c67f-4061-94c4-40ca6c7d5413","block_type":"box","text":"climate-related risks and opportunities, and informing investment decisions. Such disclosures also provide investors","page_number":213,"box":{"x":69,"y":234,"width":831,"height":11}},{"id":"dff69151-32c9-4165-a94f-ca83567b624f","block_type":"box","text":"with insights into how companies are managing the risks associated with a transition to a low-carbon economy by","page_number":213,"box":{"x":68,"y":249,"width":809,"height":11}},{"id":"9f15983b-8c43-4104-96d1-f0ff293bfc33","block_type":"box","text":"managing their own carbon emissions or emissions intensities to the extent financially practicable.","page_number":213,"box":{"x":69,"y":264,"width":702,"height":11}},{"id":"56f17076-26e7-470d-9267-a15fb2610739","block_type":"box","text":"The ISSB standards, for example, contemplate disclosures on how companies are setting short-, medium- and","page_number":213,"box":{"x":101,"y":286,"width":786,"height":12}},{"id":"73d85435-8b05-4898-9110-064d445b241f","block_type":"box","text":"long-term targets, ideally science-based where these are available for their sector, for scope 1 and 2 greenhouse gas","page_number":213,"box":{"x":70,"y":302,"width":834,"height":11}},{"id":"78ba30c6-e7d1-4abb-8455-135d13b89b33","block_type":"box","text":"emissions (GHG) reductions and to demonstrate how their targets are consistent with the long-term financial","page_number":213,"box":{"x":69,"y":317,"width":773,"height":11}},{"id":"14cf6f4d-b5d5-42e8-bb63-e2ab1bf0af32","block_type":"box","text":"interests of their investors.","page_number":213,"box":{"x":70,"y":332,"width":190,"height":9}},{"id":"10686f29-706d-4dfc-9141-a44808dca065","block_type":"box","text":"While we recognize that regulators in some markets are moving to mandate certain disclosures, at this stage,","page_number":213,"box":{"x":101,"y":355,"width":784,"height":11}},{"id":"c2095ca6-8d11-4576-b41a-ec49214ac74f","block_type":"box","text":"we view scope 3 emissions differently from scopes 1 and 2, given methodological complexity, regulatory uncertainty,","page_number":213,"box":{"x":68,"y":370,"width":832,"height":11}},{"id":"90b58935-0f98-4f81-a1d8-d20878cff4ac","block_type":"box","text":"concerns about double-counting, and lack of direct control by companies. We welcome disclosures and commitments","page_number":213,"box":{"x":69,"y":385,"width":834,"height":11}},{"id":"96cf0174-2560-4c86-a655-baf7cceccc6f","block_type":"box","text":"that companies choose to make regarding material scope 3 emissions and recognize that these are provided on a","page_number":213,"box":{"x":68,"y":400,"width":815,"height":11}},{"id":"22a20fcd-6910-4454-910b-2ac3744459b1","block_type":"box","text":"good-faith basis as methodology develops.","page_number":213,"box":{"x":68,"y":415,"width":303,"height":11}},{"id":"ed7ac567-0876-4ef4-a1bc-18c46a9e9e63","block_type":"box","text":"In addition to climate-related risks and opportunities, for companies whose strategies, operations or supply","page_number":213,"box":{"x":102,"y":438,"width":766,"height":11}},{"id":"7bcec0ef-980e-4e21-8083-86a98aa0ebe0","block_type":"box","text":"chains are materially reliant on natural capital, nature-related risks and opportunities may affect their ability to","page_number":213,"box":{"x":69,"y":453,"width":788,"height":11}},{"id":"803e4132-4b93-4f6e-a328-7731e4d4bd06","block_type":"box","text":"generate long-term financial returns.","page_number":213,"box":{"x":68,"y":468,"width":258,"height":11}},{"id":"a28deea9-a9f4-4d77-8e69-ce53a61f028f","block_type":"box","text":"14","page_number":213,"box":{"x":328,"y":468,"width":9,"height":5}},{"id":"d03235a8-6061-4c67-8230-04ef6f1a46f1","block_type":"box","text":"For these companies, we rely on disclosures to understand how their","page_number":213,"box":{"x":344,"y":468,"width":490,"height":11}},{"id":"66141414-309e-49c2-8538-9dcfd463dc6b","block_type":"box","text":"strategies consider nature-related impacts and dependencies and to assess how the board oversees these risks.","page_number":213,"box":{"x":69,"y":483,"width":807,"height":11}},{"id":"121c3893-edee-429a-9015-898094f7d6e1","block_type":"box","text":"15","page_number":213,"box":{"x":878,"y":484,"width":9,"height":4}},{"id":"28df8197-d83d-44a1-9a09-04e4a539d7d2","block_type":"box","text":"COMPANIES’ IMPACT ON THEIR WORKFORCE, SUPPLY CHAINS, AND COMMUNITIES","page_number":213,"box":{"x":179,"y":513,"width":620,"height":11}},{"id":"d692b3a3-c786-4061-a7de-a513d9fcdc5f","block_type":"box","text":"Companies determine their key stakeholders based on what is material to their business and long-term financial","page_number":213,"box":{"x":102,"y":536,"width":799,"height":11}},{"id":"1a8d9fb1-8953-4004-b759-f83f989164d4","block_type":"box","text":"performance. For many companies, key stakeholders include employees, business supply chains, clients and","page_number":213,"box":{"x":70,"y":551,"width":778,"height":11}},{"id":"9cca3908-7d0b-4f40-ae54-32b7c8277161","block_type":"box","text":"consumers, regulators, and the communities in which they operate.","page_number":213,"box":{"x":69,"y":566,"width":479,"height":11}},{"id":"e0c83b51-7d0a-4a75-869c-c8e10221a1f6","block_type":"box","text":"In our experience, companies that invest in the relationships that are critical to their strategic objectives are","page_number":213,"box":{"x":102,"y":589,"width":770,"height":11}},{"id":"d204812d-12a5-4448-af73-40e5c839b49e","block_type":"box","text":"more likely to deliver durable, long-term financial performance. By contrast, we have found that poor relationships","page_number":213,"box":{"x":69,"y":604,"width":810,"height":11}},{"id":"3bd11641-a805-42dd-93da-ed54c9e189a9","block_type":"box","text":"12","page_number":213,"box":{"x":69,"y":634,"width":9,"height":4}},{"id":"c78ccef2-3249-4176-b027-91c3df84f8fa","block_type":"box","text":"We have observed that more companies are developing such plans, and public policymakers in certain markets are","page_number":213,"box":{"x":83,"y":633,"width":823,"height":12}},{"id":"2f13d2d0-2f92-431b-a2d3-8b9f1959cb53","block_type":"box","text":"signaling their intentions to require them or already have requirements in place, such as Australia, Brazil, and the","page_number":213,"box":{"x":69,"y":649,"width":808,"height":11}},{"id":"8b0c104e-d8eb-4157-838f-1f2758a76b7f","block_type":"box","text":"European Union (please see the International Transition Plan Network for information). We view transition plans as a","page_number":213,"box":{"x":70,"y":663,"width":827,"height":11}},{"id":"cae19d61-fde8-49ea-8b15-7d8984476a2b","block_type":"box","text":"method for a company to both internally assess and externally communicate its long-term strategy, ambition,","page_number":213,"box":{"x":69,"y":679,"width":774,"height":11}},{"id":"f6aa9e31-92b6-46d1-8443-2771b0751022","block_type":"box","text":"objectives, and actions to create financial value through the global transition towards a low-carbon economy. Across","page_number":213,"box":{"x":69,"y":694,"width":825,"height":11}},{"id":"2ba14089-ae73-4ed6-afc0-8f4b741f04bd","block_type":"box","text":"the landscape there remains divergence on the objectives of such plans and the details they should contain. While","page_number":213,"box":{"x":68,"y":709,"width":819,"height":11}},{"id":"7a2b0bfc-3898-4c4a-80b8-1af4f1b53fc9","block_type":"box","text":"transition plans can be helpful disclosure, BIS does not make the preparation and production of transition plans a","page_number":213,"box":{"x":68,"y":724,"width":813,"height":11}},{"id":"17cbd6ba-b6b6-410e-b622-92406137035e","block_type":"box","text":"voting issue. BIS may engage companies that have chosen to publish a transition plan to understand their planned","page_number":213,"box":{"x":68,"y":739,"width":819,"height":11}},{"id":"75109f3f-d583-4b25-8126-733b61542e39","block_type":"box","text":"actions and resource implications. Website accessed in December 2025.","page_number":213,"box":{"x":69,"y":754,"width":522,"height":11}},{"id":"bd7ce5e8-1ab2-4820-9d19-b4fcf8d8df6a","block_type":"box","text":"13","page_number":213,"box":{"x":69,"y":772,"width":9,"height":5}},{"id":"4af7a088-c5cf-4b59-abaa-2376d49dc8ad","block_type":"box","text":"For more information, please see our commentary “Climate-related risks and a low-carbon transition,” December","page_number":213,"box":{"x":84,"y":772,"width":804,"height":11}},{"id":"58aa32c4-469d-4c02-b60f-a00f8baa13cb","block_type":"box","text":"2025.","page_number":213,"box":{"x":69,"y":787,"width":42,"height":9}},{"id":"c5bf6543-923b-4100-9e56-8aebbe8459da","block_type":"box","text":"14","page_number":213,"box":{"x":69,"y":805,"width":9,"height":4}},{"id":"730ac449-0aee-4392-bd24-64777ee09ec3","block_type":"box","text":"For more information, please see our commentary “Our approach to engagement on natural capital,” December","page_number":213,"box":{"x":84,"y":805,"width":796,"height":11}},{"id":"9686b00a-cf40-42af-93f2-c80c9a994b01","block_type":"box","text":"2025.","page_number":213,"box":{"x":69,"y":820,"width":42,"height":9}},{"id":"0d0392b1-7786-43c2-b2aa-57885869a55d","block_type":"box","text":"15","page_number":213,"box":{"x":69,"y":838,"width":9,"height":4}},{"id":"2d685fd0-042a-429a-9111-75ca0c084da7","block_type":"box","text":"Given the growing awareness of the materiality of these issues for certain businesses, enhanced reporting on a","page_number":213,"box":{"x":84,"y":837,"width":797,"height":12}},{"id":"bb262b07-f8a3-4b29-b980-e8bc8fbd39f7","block_type":"box","text":"company’s natural capital dependencies and impacts would aid investors’ understanding. The recommendations of","page_number":213,"box":{"x":69,"y":852,"width":820,"height":12}},{"id":"6b948d45-6070-4ec4-94eb-1060f5000f52","block_type":"box","text":"the Taskforce on Nature-related Financial Disclosures (TNFD) may prove useful to some companies. We recognize that","page_number":213,"box":{"x":68,"y":868,"width":842,"height":11}},{"id":"8a0c2cb9-e19d-493f-b6c4-ebe2f286a9c2","block_type":"box","text":"some companies may report using different standards, which may be required by regulation, or one of a number of","page_number":213,"box":{"x":69,"y":883,"width":820,"height":11}},{"id":"822df56a-22bd-4b0a-9671-2efb3c1e833a","block_type":"box","text":"other private sector standards. TNFD-aligned reporting is not a voting issue. Website accessed in December 2025.","page_number":213,"box":{"x":69,"y":898,"width":817,"height":11}},{"id":"9a9a3072-c72e-4772-b709-7d412439e3e8","block_type":"box","text":"BlackRock Investment Stewardship","page_number":213,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"58d86bba-16d7-4642-942b-92f41ac04c37","block_type":"box","text":"Global Principles | 11","page_number":213,"box":{"x":758,"y":942,"width":151,"height":13}},{"id":"1a2403ab-f6b1-4d3b-81ce-de53a8a37a0b","block_type":"box","text":"NM0926U-5977317-213/232","page_number":213,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"7ab8dc7a-0787-4cbd-9229-c95cfd55ed8a","block_type":"box","text":"may create adverse impacts that could expose companies to legal, regulatory, operational, and reputational risks.","page_number":214,"box":{"x":69,"y":45,"width":811,"height":11}},{"id":"c4d07705-2d98-438e-b699-b1ff592f0d3f","block_type":"box","text":"This is particularly relevant to a company’s workforce, which is central to long-term financial value creation.","page_number":214,"box":{"x":68,"y":60,"width":764,"height":11}},{"id":"e8cf35af-77be-479f-95ef-f2afe8d86e83","block_type":"box","text":"16","page_number":214,"box":{"x":834,"y":60,"width":9,"height":5}},{"id":"ca1b91f9-8965-43c5-a25d-7510ea4fd8c2","block_type":"box","text":"As a long-term shareholder on behalf of our clients, we find it helpful when companies disclose how they have","page_number":214,"box":{"x":101,"y":82,"width":783,"height":12}},{"id":"97fd3c2d-6296-4196-97d9-cc01bdbe71e2","block_type":"box","text":"identified their key stakeholders and considered their interests in business decision-making. In addition to","page_number":214,"box":{"x":70,"y":98,"width":755,"height":11}},{"id":"87d38bab-d387-42bd-b6f0-3ab8e3e6ff60","block_type":"box","text":"understanding broader stakeholder relationships, BIS finds it helpful when companies discuss how they consider the","page_number":214,"box":{"x":69,"y":113,"width":831,"height":11}},{"id":"d469ae1a-8f70-4f22-a268-51fc402bb378","block_type":"box","text":"needs of their workforce today, and the skills required for their future business strategy. We are also interested in","page_number":214,"box":{"x":69,"y":128,"width":809,"height":11}},{"id":"8bdf2788-7e23-44ce-97fe-6c681bd4cbf9","block_type":"box","text":"understanding how the board monitors and engages on these matters, given it is well positioned to ensure that the","page_number":214,"box":{"x":69,"y":143,"width":821,"height":11}},{"id":"bb433827-1a60-4b6f-abf3-d0415696c57c","block_type":"box","text":"approach taken by management is informed by and aligns with the company’s strategy. BIS does not direct a","page_number":214,"box":{"x":69,"y":158,"width":775,"height":11}},{"id":"e9a64d7e-0a1d-4c69-8c6a-88276856a18e","block_type":"box","text":"company’s policies or practices, which are the responsibility of management and the board.","page_number":214,"box":{"x":69,"y":173,"width":653,"height":11}},{"id":"3bccbd49-1b8e-4b7e-958a-939ac63fe729","block_type":"box","text":"In addition, we find it helpful when companies disclose their approach to addressing material adverse impacts","page_number":214,"box":{"x":102,"y":196,"width":784,"height":11}},{"id":"2e8a26da-de05-4f94-993d-5326af0058b1","block_type":"box","text":"that could arise from their business practices and affect critical relationships with their stakeholders. We encourage","page_number":214,"box":{"x":68,"y":211,"width":829,"height":11}},{"id":"8edebbf8-21c9-46b5-8173-cadf7177f354","block_type":"box","text":"companies to implement, to the extent appropriate, monitoring processes (often referred to as due diligence) to","page_number":214,"box":{"x":69,"y":226,"width":797,"height":11}},{"id":"4822962a-8cb9-439a-8a92-f58251e9096b","block_type":"box","text":"identify and mitigate potential adverse impacts and grievance mechanisms to remediate any actual adverse material","page_number":214,"box":{"x":70,"y":241,"width":828,"height":11}},{"id":"edaaa387-80dc-47d6-801d-bb78dfc39b5f","block_type":"box","text":"impacts.","page_number":214,"box":{"x":70,"y":257,"width":58,"height":10}},{"id":"6dbc9bd4-4524-496e-a058-e5056b0403a8","block_type":"box","text":"We look to boards to oversee management’s approach to addressing material risks related to key stakeholders","page_number":214,"box":{"x":101,"y":279,"width":794,"height":11}},{"id":"7b118d60-217d-4799-96db-bc63002efb64","block_type":"box","text":"and may convey concerns about board oversight in our voting on director elections or supporting a business relevant","page_number":214,"box":{"x":69,"y":294,"width":831,"height":11}},{"id":"94af2d0b-2d3d-4262-abd9-e5e75a4aace3","block_type":"box","text":"shareholder proposal when, in our assessment, the board is not acting in shareholders’ long-term financial interests.","page_number":214,"box":{"x":69,"y":309,"width":834,"height":11}},{"id":"9dca5912-b981-4c15-88ac-9d42815d3cfc","block_type":"box","text":"BLACKROCK’S OVERSIGHT OF ITS INVESTMENT STEWARDSHIP ACTIVITIES","page_number":214,"box":{"x":213,"y":340,"width":553,"height":8}},{"id":"df62ca04-24dc-4dd1-93ec-dd89d4d24446","block_type":"box","text":"BIS’ governance structure supports oversight and accountability of stewardship-related activities on behalf of","page_number":214,"box":{"x":102,"y":362,"width":778,"height":11}},{"id":"ac4fdd31-6efe-4ce9-b3fc-d8b7279cb82b","block_type":"box","text":"clients at the global and regional level.","page_number":214,"box":{"x":69,"y":377,"width":274,"height":12}},{"id":"13aecf39-f1c8-47b9-8725-bbf469e625c1","block_type":"box","text":"At the top of this governance structure, the risk-focused BIS Global Oversight Committee (the Committee)","page_number":214,"box":{"x":101,"y":400,"width":751,"height":11}},{"id":"1120a52a-e048-47d2-9d1a-51614925338f","block_type":"box","text":"supports BIS’ regulatory responsibilities in relation to proxy voting, including adherence to policies and procedures as","page_number":214,"box":{"x":69,"y":415,"width":840,"height":11}},{"id":"431e6ca2-db26-44ca-adeb-5ad3d496d83b","block_type":"box","text":"well as market-level stewardship requirements. The Committee reviews and approves amendments to the Global","page_number":214,"box":{"x":68,"y":430,"width":802,"height":11}},{"id":"c67381ec-2cc3-49c6-bf7c-fec4de293060","block_type":"box","text":"Principles and regional voting guidelines. The Committee also reviews periodic reports regarding the votes cast by","page_number":214,"box":{"x":69,"y":445,"width":813,"height":12}},{"id":"3fc1e188-d27a-4e57-a1b6-4d88a864186f","block_type":"box","text":"BIS on behalf of clients, as well as updates on material process issues, procedural changes, and other risk oversight","page_number":214,"box":{"x":70,"y":460,"width":835,"height":12}},{"id":"1914f2e0-5e14-4152-bf50-2e2e445a98d7","block_type":"box","text":"considerations. The Committee is chaired by the Global Heads of the Investment Stewardship function and its","page_number":214,"box":{"x":69,"y":475,"width":783,"height":12}},{"id":"c8e16f64-7c38-4076-b6b8-03677b5670cf","block_type":"box","text":"members include senior BlackRock executives with legal, risk, and other experience relevant to team oversight who","page_number":214,"box":{"x":69,"y":491,"width":820,"height":11}},{"id":"bd46ce68-9e13-4177-99f4-37bbac45d337","block_type":"box","text":"are independent from the investment stewardship function.","page_number":214,"box":{"x":69,"y":506,"width":421,"height":11}},{"id":"cccf877a-c788-4f3b-a512-5068cf68ee3f","block_type":"box","text":"The Global Heads have primary oversight of BIS’ activities globally, including voting in accordance with the Global","page_number":214,"box":{"x":101,"y":528,"width":804,"height":12}},{"id":"6050f1c6-221f-4949-baee-70265e2964c7","block_type":"box","text":"Principles and regional voting guidelines. At the regional level, three regional Heads for the Americas, APAC, and","page_number":214,"box":{"x":69,"y":543,"width":798,"height":12}},{"id":"17f8e3eb-b512-4a10-ae2d-a3a30b0c94ce","block_type":"box","text":"EMEA oversee BIS’ activities for their specific markets.","page_number":214,"box":{"x":70,"y":559,"width":389,"height":11}},{"id":"53b84217-e9ea-4b87-8a18-efce218dd2b6","block_type":"box","text":"VOTE EXECUTION","page_number":214,"box":{"x":424,"y":589,"width":129,"height":9}},{"id":"5c2fea05-c2cf-44b4-a0c1-16c584ca6431","block_type":"box","text":"BIS votes proxies on behalf of index equity funds and accounts when authorized by our clients. We have","page_number":214,"box":{"x":102,"y":612,"width":739,"height":11}},{"id":"ede0a43f-55a3-4c70-8a50-4805f0a4d6cb","block_type":"box","text":"processes in place to consider all proxies for which we have voting authority, and submit voting decisions, or refrain","page_number":214,"box":{"x":70,"y":627,"width":822,"height":11}},{"id":"a96724a8-088d-4fcf-9280-4fc15950cf0c","block_type":"box","text":"from voting when logistical issues arise (see below). The BIS Benchmark Policies – and the vote decisions made","page_number":214,"box":{"x":68,"y":642,"width":801,"height":11}},{"id":"8c765d88-5d48-46b6-b680-3903fd09fe7a","block_type":"box","text":"consistent with those policies – reflect our reasonable and independent judgment and are made without regard to the","page_number":214,"box":{"x":69,"y":657,"width":838,"height":11}},{"id":"df56fa05-8221-450f-9302-0cb6a0d15c20","block_type":"box","text":"relationship between the issuer of the proxy (or any shareholder proponent or dissident shareholder) and the Fund,","page_number":214,"box":{"x":69,"y":672,"width":817,"height":11}},{"id":"b4b24d6c-7e96-452a-b355-ae5ae13a9615","block_type":"box","text":"the Fund’s affiliates (if any), BlackRock or BlackRock’s affiliates, or BlackRock employees (see “Conflicts","page_number":214,"box":{"x":68,"y":687,"width":751,"height":11}},{"id":"f0fa7103-edc3-4a8d-8c7a-93e7b92fae89","block_type":"box","text":"management policies and procedures,” below).","page_number":214,"box":{"x":69,"y":703,"width":334,"height":11}},{"id":"8d670037-6bb7-4db6-a0e0-02026a101ecb","block_type":"box","text":"In certain markets, proxy voting involves logistical issues which can affect BIS’ ability to vote, as well as the cost","page_number":214,"box":{"x":102,"y":725,"width":806,"height":11}},{"id":"03c4e0db-819d-4daf-89f7-5928b86021bb","block_type":"box","text":"of voting such proxies on behalf of our clients. These issues include, but are not limited to: 1) untimely notice of","page_number":214,"box":{"x":69,"y":740,"width":801,"height":11}},{"id":"510437d1-51d8-4d4a-a759-72997aa24a2d","block_type":"box","text":"shareholder meetings; 2) restrictions on a foreigner’s ability to exercise votes; 3) requirements to vote proxies in","page_number":214,"box":{"x":69,"y":755,"width":805,"height":11}},{"id":"7aa0cb9f-4f36-44f2-a1f7-2478782a215a","block_type":"box","text":"person; 4) “share-blocking” (requirements that investors who exercise their voting rights surrender the right to","page_number":214,"box":{"x":70,"y":771,"width":783,"height":11}},{"id":"85495ecd-798f-4f86-9bd2-4927c22eba24","block_type":"box","text":"dispose of their holdings from the point at which votes are submitted until after the after the shareholder meeting","page_number":214,"box":{"x":69,"y":785,"width":811,"height":12}},{"id":"6536b10f-4b83-472d-b7eb-0429aa33fc4b","block_type":"box","text":"has occurred); 5) potential difficulties in translating the proxy; 6) regulatory constraints; and 7) requirements to","page_number":214,"box":{"x":69,"y":801,"width":795,"height":11}},{"id":"fc9d8385-8673-4e4a-9557-1b9887e720e6","block_type":"box","text":"provide local agents with powers of attorney to facilitate voting instructions. We are not supportive of impediments to","page_number":214,"box":{"x":70,"y":816,"width":835,"height":11}},{"id":"badd089c-ae01-4ccd-b0c3-6d0218523e72","block_type":"box","text":"the exercise of voting rights such as share-blocking or overly burdensome administrative requirements.","page_number":214,"box":{"x":68,"y":831,"width":732,"height":11}},{"id":"397518b9-55f0-47be-adb8-7e95a89e0594","block_type":"box","text":"16","page_number":214,"box":{"x":69,"y":860,"width":9,"height":5}},{"id":"6c63106c-c8c3-4268-a5d1-5d878d008cfd","block_type":"box","text":"For more information, please see our commentary “Our approach to engagement on human capital management,”","page_number":214,"box":{"x":84,"y":860,"width":814,"height":11}},{"id":"bdb5d23d-3074-48c6-a7c0-8fe51c2ad91b","block_type":"box","text":"December 2025.","page_number":214,"box":{"x":70,"y":875,"width":118,"height":9}},{"id":"488b3d2a-5eb7-4b6d-9b6b-0298cd278ada","block_type":"box","text":"BlackRock Investment Stewardship","page_number":214,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"4f96dc77-79c6-49d3-83f6-5e498090bb17","block_type":"box","text":"Global Principles | 12","page_number":214,"box":{"x":758,"y":942,"width":151,"height":13}},{"id":"964660e1-2e49-4a94-9971-820b8ad1be0c","block_type":"box","text":"NM0926U-5977317-214/232","page_number":214,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"918e31ec-cc87-43b2-9310-268f6ede38ea","block_type":"box","text":"BIS votes proxies in these situations on a “best-efforts” basis. In addition, BIS may determine that it is generally","page_number":215,"box":{"x":102,"y":45,"width":807,"height":11}},{"id":"a6e3443b-91ee-4f52-9fae-401ba1c6488c","block_type":"box","text":"in the interests of BlackRock’s clients not to vote proxies (or not to vote our full allocation) if the costs (including but","page_number":215,"box":{"x":70,"y":60,"width":830,"height":11}},{"id":"2468cc10-170c-4f73-bdb8-9e0856065d81","block_type":"box","text":"not limited to opportunity costs associated with share-blocking constraints) associated with exercising a vote are","page_number":215,"box":{"x":69,"y":75,"width":805,"height":11}},{"id":"a5918550-00ec-447a-a8d1-bb0390d32649","block_type":"box","text":"expected to outweigh the benefit the client would derive by voting on the proposal.","page_number":215,"box":{"x":69,"y":90,"width":585,"height":11}},{"id":"729a0a6a-41ee-4037-9e95-81d5f92ee58d","block_type":"box","text":"CONFLICTS MANAGEMENT POLICIES AND PROCEDURES","page_number":215,"box":{"x":281,"y":120,"width":416,"height":9}},{"id":"14a31902-1f3e-4423-b677-09e9753ccc6f","block_type":"box","text":"BIS is a dedicated function whose responsibilities are separate from BlackRock’s sales, business partnership or","page_number":215,"box":{"x":102,"y":143,"width":804,"height":11}},{"id":"d62eb334-6394-4aad-887a-24ad027889ae","block_type":"box","text":"enterprise-level vendor management activities.","page_number":215,"box":{"x":69,"y":158,"width":329,"height":11}},{"id":"b381d45a-458e-4be7-911b-75939bbf2879","block_type":"box","text":"BlackRock maintains policies and procedures that are designed to prevent undue influence on BIS’ proxy voting","page_number":215,"box":{"x":102,"y":181,"width":794,"height":11}},{"id":"aaba1665-b3c9-4a9d-a8e3-40c7cc7ba65e","block_type":"box","text":"activity. Such influence might stem from any relationship between the investee company (or any shareholder","page_number":215,"box":{"x":69,"y":196,"width":771,"height":11}},{"id":"1071db43-39c3-4336-8418-f1256f023975","block_type":"box","text":"proponent or dissident shareholder) and BlackRock, BlackRock’s affiliates, a Fund or a Fund’s affiliates, or","page_number":215,"box":{"x":70,"y":211,"width":763,"height":11}},{"id":"10d58c6e-1789-4730-b906-6f0af5ae01eb","block_type":"box","text":"BlackRock employees.","page_number":215,"box":{"x":70,"y":226,"width":157,"height":11}},{"id":"0beabe3d-3da8-4ff6-954d-0dd2e0a5c25d","block_type":"box","text":"For information on how BIS manages conflicts of interest, please see our disclosure.","page_number":215,"box":{"x":102,"y":249,"width":602,"height":11}},{"id":"a27855d7-dc17-464e-8faa-86fc426462b8","block_type":"box","text":"SECURITIES LENDING","page_number":215,"box":{"x":409,"y":279,"width":159,"height":9}},{"id":"d366ae96-6099-43ac-804f-932811a5f508","block_type":"box","text":"When authorized, BlackRock acts as a securities lending agent on behalf of its clients. Lending securities","page_number":215,"box":{"x":101,"y":302,"width":751,"height":11}},{"id":"d48464dc-bdc7-473c-9d6e-e175f28be0fc","block_type":"box","text":"enables BlackRock to increase the returns in clients’ portfolios, and BlackRock’s lending agreements allow it to","page_number":215,"box":{"x":69,"y":317,"width":797,"height":11}},{"id":"2d202ecc-323b-486b-abeb-3bf4a3e415ea","block_type":"box","text":"recall securities out on loan at any time. BlackRock (or any other lender) does not retain voting rights for securities","page_number":215,"box":{"x":69,"y":332,"width":817,"height":11}},{"id":"4c6dbb6e-3e45-4334-a81a-2438dcb04703","block_type":"box","text":"out on loan. Entitlements associated with the lent securities (dividends, coupons, etc.), while on loan are paid back","page_number":215,"box":{"x":69,"y":347,"width":823,"height":11}},{"id":"d5c0ed75-769d-42ac-af79-bfe4fca4b4f0","block_type":"box","text":"to the lender of the security as stipulated in industry standard legal agreements.","page_number":215,"box":{"x":68,"y":362,"width":575,"height":11}},{"id":"c802dfbb-a25e-451e-9fed-59dd49fabcb1","block_type":"box","text":"With regard to the relationship between securities lending and proxy voting, BlackRock cannot vote shares on","page_number":215,"box":{"x":101,"y":385,"width":779,"height":11}},{"id":"d4197fb8-bd2c-48b3-b26a-2e26a065815b","block_type":"box","text":"loan and may determine to recall them for voting, as guided by our fiduciary duty as an asset manager to our clients","page_number":215,"box":{"x":70,"y":400,"width":827,"height":11}},{"id":"6e6a08ee-5757-4ae3-8c93-0bbf1d84a247","block_type":"box","text":"in helping them achieve their investment goals. 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All other trademarks are those of their respective owners.","page_number":217,"box":{"x":70,"y":898,"width":624,"height":11}},{"id":"69660885-d257-4ea2-a19d-e81df528c9e1","block_type":"box","text":"BlackRock Investment Stewardship","page_number":217,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"c4bcc39c-b853-4196-95c6-ad9eed94d56f","block_type":"box","text":"Global Principles | 15","page_number":217,"box":{"x":758,"y":942,"width":151,"height":13}},{"id":"6bac066f-26c5-4b22-87b3-f3802b1c37b9","block_type":"box","text":"NM0926U-5977317-217/232","page_number":217,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"64a21490-7882-4f1e-8b54-41e5035a2f35","block_type":"box","text":"BlackRock Investment Stewardship","page_number":218,"box":{"x":359,"y":45,"width":260,"height":11}},{"id":"c2fa0aee-e8d6-48ad-9691-30ed6a2fabd1","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines","page_number":218,"box":{"x":297,"y":67,"width":384,"height":11}},{"id":"894e22d1-63d7-4d0b-80db-a61cd2b4db6a","block_type":"box","text":"Effective as of January 2026","page_number":218,"box":{"x":385,"y":90,"width":208,"height":11}},{"id":"0ac7e39f-0f24-4af3-9b59-bc254be56004","block_type":"box","text":"NM0926U-5977317-218/232","page_number":218,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"a048d3e1-8352-4f35-bab2-34b188d60c45","block_type":"box","text":"Contents","page_number":219,"box":{"x":456,"y":45,"width":66,"height":9}},{"id":"17a93951-7f78-4171-a876-c88df3063be2","block_type":"box","text":"Introduction to BlackRock Investment Stewardship 3","page_number":219,"box":{"x":69,"y":80,"width":840,"height":11}},{"id":"1ec9b3a9-d618-4882-bbbf-51dd751cdcb1","block_type":"box","text":"Stewardship for clients with investment objectives relating to the low-carbon transition 3","page_number":219,"box":{"x":68,"y":96,"width":841,"height":11}},{"id":"bdfdcbd6-e3a6-43f4-8373-988e00708fe4","block_type":"box","text":"The Climate and Decarbonization Stewardship Guidelines 3","page_number":219,"box":{"x":68,"y":113,"width":841,"height":11}},{"id":"77cfc4ea-6a4c-495f-89c3-3efafc9e128c","block_type":"box","text":"Understanding the investment implications of the transition to a low-carbon economy 4","page_number":219,"box":{"x":69,"y":129,"width":840,"height":11}},{"id":"62f3dfa2-4798-4365-b738-918c1a7eb7a6","block_type":"box","text":"The Guidelines’ design principles","page_number":219,"box":{"x":68,"y":146,"width":240,"height":11}},{"id":"7bd5fbd1-697b-4437-a510-33d11cb9fe96","block_type":"box","text":"4","page_number":219,"box":{"x":900,"y":146,"width":9,"height":8}},{"id":"c0a6663e-d759-40c0-bbaf-54e3b16335ec","block_type":"box","text":"Voting approach under the Guidelines","page_number":219,"box":{"x":68,"y":162,"width":273,"height":11}},{"id":"a1574c09-cb6c-443b-b0a9-6a6f5236b4de","block_type":"box","text":"5","page_number":219,"box":{"x":901,"y":162,"width":8,"height":9}},{"id":"1011fb79-d279-410b-ab85-4dafe5743023","block_type":"box","text":"Related matters","page_number":219,"box":{"x":69,"y":178,"width":117,"height":9}},{"id":"f7a5bbcf-d640-4071-b943-9fdf1e01d4be","block_type":"box","text":"8","page_number":219,"box":{"x":900,"y":178,"width":9,"height":9}},{"id":"e0139345-2898-4216-aeab-141237e5caff","block_type":"box","text":"Appendix 1","page_number":219,"box":{"x":68,"y":195,"width":82,"height":11}},{"id":"f4dc434e-e2e7-483b-8760-05bd8d89d542","block_type":"box","text":"10","page_number":219,"box":{"x":891,"y":195,"width":18,"height":9}},{"id":"9170b5b9-4a75-4401-943b-24b782451add","block_type":"box","text":"Appendix 2","page_number":219,"box":{"x":68,"y":211,"width":82,"height":11}},{"id":"f67dcb92-aa43-4a36-a496-f5c93835dde0","block_type":"box","text":"11","page_number":219,"box":{"x":891,"y":211,"width":18,"height":9}},{"id":"958afb53-2815-4d07-9ea6-0a1961f027a1","block_type":"box","text":"BlackRock Investment Stewardship","page_number":219,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"2064373a-e3d2-4a5b-9fd5-ac60caa47469","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines | 2","page_number":219,"box":{"x":509,"y":942,"width":400,"height":13}},{"id":"f6248a07-9f47-4e2a-819f-4062d2da97a8","block_type":"box","text":"NM0926U-5977317-219/232","page_number":219,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"7a687f7a-5d02-4512-8bf1-671b54ba8ad5","block_type":"box","text":"INTRODUCTION TO BLACKROCK INVESTMENT STEWARDSHIP","page_number":220,"box":{"x":264,"y":45,"width":450,"height":9}},{"id":"fa272b71-2072-4874-8931-ddeeda694aff","block_type":"box","text":"At BlackRock, investment stewardship serves as a link between our clients and the companies they invest in and","page_number":220,"box":{"x":101,"y":68,"width":807,"height":10}},{"id":"d29f5567-6560-400f-b37c-4843697ca9ef","block_type":"box","text":"is one of the ways we fulfill our fiduciary responsibilities as an asset manager on their behalf. 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Under the Guidelines, the dedicated team","page_number":222,"box":{"x":102,"y":176,"width":805,"height":11}},{"id":"698ff725-906c-4059-a4df-06fb71dd9324","block_type":"box","text":"makes decisions on how to engage companies and vote proxies independently, based on its professional","page_number":222,"box":{"x":102,"y":191,"width":748,"height":11}},{"id":"965f1645-fc42-487f-977e-39952781fe1f","block_type":"box","text":"judgment of the priorities and outcomes most aligned with participating clients’ investment objectives.","page_number":222,"box":{"x":100,"y":206,"width":730,"height":11}},{"id":"576369e6-0fd3-4435-8696-f0ad1bbe100b","block_type":"box","text":"Voting approach under the Guidelines","page_number":222,"box":{"x":68,"y":236,"width":273,"height":11}},{"id":"432e9fee-a375-47ae-92d5-889c6152d0b4","block_type":"box","text":"12","page_number":222,"box":{"x":342,"y":237,"width":9,"height":4}},{"id":"d4b38a2b-8caa-47c4-a1af-bf6a77f63db2","block_type":"box","text":"When evaluating each voting item across management or shareholder proposals, the dedicated team applies a","page_number":222,"box":{"x":101,"y":259,"width":791,"height":11}},{"id":"36623aa9-2c76-46a5-a93b-fa4758f8f1fc","block_type":"box","text":"case-by-case approach that reflects the uneven pace of the low-carbon transition across sectors and markets, and","page_number":222,"box":{"x":69,"y":274,"width":813,"height":11}},{"id":"6ba4ff9e-2930-4e25-9d52-cad99a9297f4","block_type":"box","text":"acknowledges the distinction between what company management can influence and what lies beyond its control. As","page_number":222,"box":{"x":69,"y":289,"width":833,"height":11}},{"id":"6a69b1ff-cb60-4375-9c56-544f4818d04b","block_type":"box","text":"a result, voting decisions — on behalf of in-scope funds and SMAs — on similar proposals included on different","page_number":222,"box":{"x":69,"y":304,"width":799,"height":11}},{"id":"52a691db-1ae9-4596-8a61-6ffbdbe0184e","block_type":"box","text":"companies’ shareholder meeting agendas may vary depending on company, sector, or market-specific circumstances.","page_number":222,"box":{"x":69,"y":319,"width":837,"height":12}},{"id":"ca6b637f-d4e7-4c55-a646-960815c685a4","block_type":"box","text":"Consistent with the investment objective of each fund or account that has selected these Guidelines, the","page_number":222,"box":{"x":102,"y":342,"width":748,"height":11}},{"id":"ccb796d5-7bd3-47fa-8a64-b58f294e6f22","block_type":"box","text":"dedicated team will look to the companies to demonstrate the following:","page_number":222,"box":{"x":69,"y":357,"width":513,"height":11}},{"id":"58d9dc43-0d65-41f1-9584-5b090bea6eef","block_type":"box","text":"Corporate Disclosures","page_number":222,"box":{"x":69,"y":387,"width":160,"height":11}},{"id":"6ef7e99e-4031-4c89-b4b0-c9c4fa4ce6a5","block_type":"box","text":"13","page_number":222,"box":{"x":230,"y":388,"width":9,"height":4}},{"id":"521608cc-250c-4d7c-86e4-573c51faaf35","block_type":"box","text":"In the context of these Guidelines, the dedicated team looks for companies to provide sufficient disclosure to","page_number":222,"box":{"x":102,"y":410,"width":781,"height":11}},{"id":"ce5c684b-c0f3-4f2e-a3e7-e36c16725a5f","block_type":"box","text":"assess whether the company’s strategy is aligned with the low-carbon transition. As a general point, the team looks","page_number":222,"box":{"x":69,"y":425,"width":825,"height":11}},{"id":"d1dffbcc-b100-4234-b2fc-bcbc8895b4a2","block_type":"box","text":"to companies that are important to the transition to a low-carbon economy to explain the strategy and governance","page_number":222,"box":{"x":68,"y":440,"width":812,"height":12}},{"id":"e4e71eea-8b5c-4ebd-8a61-be80d415eb7c","block_type":"box","text":"frameworks that they have determined most appropriate, which may include:","page_number":222,"box":{"x":68,"y":455,"width":545,"height":11}},{"id":"b78cc074-14eb-450d-9e75-ee228291d94b","block_type":"box","text":"(1) a low-carbon transition strategy to demonstrate their alignment with the ambition to limit average global","page_number":222,"box":{"x":69,"y":476,"width":769,"height":11}},{"id":"f5601ca1-a674-4a19-89d8-0d2ceeada873","block_type":"box","text":"temperature rise to 1.5°C above pre-industrial levels. This would typically include a long-term strategy to achieve","page_number":222,"box":{"x":101,"y":491,"width":800,"height":11}},{"id":"5b68bf33-936e-47fd-88eb-f9b4dcfe531b","block_type":"box","text":"net-zero GHG emissions by 2050, with appropriate near- and medium-term milestones to assess their progress.","page_number":222,"box":{"x":102,"y":506,"width":796,"height":11}},{"id":"6aa09cbb-b70e-46d0-87d7-11ab1508d52d","block_type":"box","text":"(2) low-carbon transition-related reporting. Standardized disclosure of sustainability-related data supports investors","page_number":222,"box":{"x":69,"y":526,"width":828,"height":11}},{"id":"881259c8-9fba-4627-91da-e692ff0335f4","block_type":"box","text":"in making informed decisions. The International Sustainability Standards Board (ISSB) standards, IFRS S1 and","page_number":222,"box":{"x":102,"y":541,"width":787,"height":11}},{"id":"83c3b00a-b999-4367-89db-7ecd94b738a5","block_type":"box","text":"S2, represent one such approach to standardization that the dedicated team finds useful in its analysis.","page_number":222,"box":{"x":102,"y":556,"width":741,"height":11}},{"id":"d33bfa05-9959-4095-8f90-850f5c0b6fc9","block_type":"box","text":"14, 15","page_number":222,"box":{"x":845,"y":557,"width":25,"height":5}},{"id":"0840d7a2-2daf-4823-8674-addcc56bc858","block_type":"box","text":"IFRS","page_number":222,"box":{"x":877,"y":556,"width":30,"height":9}},{"id":"5a9039ed-0b8f-449b-b711-fb39e5a39f38","block_type":"box","text":"S1 addresses the general requirements of sustainability reporting and IFRS S2 sets out the disclosures that","page_number":222,"box":{"x":102,"y":571,"width":774,"height":12}},{"id":"3c89e9da-6316-4933-b048-8022dab5be58","block_type":"box","text":"provide investors with decision-useful information about a company’s most significant climate- and low-carbon","page_number":222,"box":{"x":102,"y":586,"width":781,"height":12}},{"id":"0e784393-d223-490e-9be8-08b69e3da220","block_type":"box","text":"transition-related risks and opportunities. This includes receiving independent, third-party assurances, as audit","page_number":222,"box":{"x":101,"y":602,"width":792,"height":11}},{"id":"1d5c4eab-3a1b-4464-8e9b-14923c6ec566","block_type":"box","text":"and assurance standards are developed.","page_number":222,"box":{"x":102,"y":617,"width":290,"height":11}},{"id":"941ff263-bc0a-4968-ad59-9a48a9cfea9f","block_type":"box","text":"12","page_number":222,"box":{"x":69,"y":646,"width":9,"height":5}},{"id":"4ac9be40-732c-4857-894f-9f077c835361","block_type":"box","text":"These Guidelines are not intended to limit the analysis of individual issues at specific companies or provide a guide","page_number":222,"box":{"x":83,"y":646,"width":825,"height":11}},{"id":"12685b33-00e7-44f0-8694-9563b5e8cc14","block_type":"box","text":"as to how the dedicated team will engage and/or vote in every instance. The Guidelines are applied by the dedicated","page_number":222,"box":{"x":69,"y":661,"width":833,"height":11}},{"id":"f31c0d3b-f751-42eb-bb40-459bf347f804","block_type":"box","text":"team with discretion, on a case-by-case basis, taking into consideration the range of issues and facts specific to the","page_number":222,"box":{"x":68,"y":676,"width":830,"height":11}},{"id":"e842329e-8a9f-4ed3-b1f6-3e9de5800042","block_type":"box","text":"company, as well as individual ballot items at shareholder meetings.","page_number":222,"box":{"x":69,"y":691,"width":486,"height":11}},{"id":"a837ee10-03c5-4735-bc83-172e97808096","block_type":"box","text":"13","page_number":222,"box":{"x":69,"y":709,"width":9,"height":5}},{"id":"9ff9f178-9c3d-422e-b2fb-b0a56c41468f","block_type":"box","text":"Given data and measurement limitations, companies may need to provide estimated GHG emissions where","page_number":222,"box":{"x":84,"y":709,"width":764,"height":11}},{"id":"4bb2a1d2-11df-4853-ae28-8f21c05224f2","block_type":"box","text":"reporting methodologies are nascent. In addition, certain disclosures related to a company’s plans for adapting their","page_number":222,"box":{"x":69,"y":724,"width":834,"height":11}},{"id":"1375e75c-3d8f-4c31-9745-09b958d6f5bb","block_type":"box","text":"business models through the low-carbon transition may require forward-looking statements.","page_number":222,"box":{"x":69,"y":739,"width":651,"height":11}},{"id":"51155cfe-4972-4e25-a72b-bc8e2b907a08","block_type":"box","text":"14","page_number":222,"box":{"x":69,"y":757,"width":9,"height":4}},{"id":"b10247bc-29f9-46d0-81c7-b8950edfdc46","block_type":"box","text":"The ISSB is an independent standard-setting body within the International Financial Reporting Standards","page_number":222,"box":{"x":83,"y":757,"width":744,"height":11}},{"id":"d619de51-b28a-4fc9-a5be-833d534b82ac","block_type":"box","text":"(IFRS) Foundation. The standards build on the Task Force on Climate-related Financial Disclosures (TCFD) framework","page_number":222,"box":{"x":69,"y":772,"width":828,"height":11}},{"id":"95304254-6117-4b00-8c3a-0a570f1e183b","block_type":"box","text":"and the standards and metrics developed by the Sustainability Accounting Standards Board (SASB), which have both","page_number":222,"box":{"x":69,"y":787,"width":830,"height":11}},{"id":"3cbb19c7-3783-4d95-a63c-e01787bfcb9f","block_type":"box","text":"converged under the ISSB. Please refer to the IFRS website to learn more about the framework and standards S1","page_number":222,"box":{"x":69,"y":802,"width":809,"height":11}},{"id":"18597c80-ab17-491d-9809-9483cd42d7c9","block_type":"box","text":"“General Requirements for Disclosure of Sustainability-related Financial Information” and S2 “Climate-related","page_number":222,"box":{"x":70,"y":817,"width":778,"height":11}},{"id":"9957375f-3d75-4547-b88e-2c7dea5c368f","block_type":"box","text":"Disclosures.” Websites accessed in December 2025.","page_number":222,"box":{"x":70,"y":832,"width":380,"height":9}},{"id":"4f5c321e-8295-483e-addc-69ab5eb1e010","block_type":"box","text":"15","page_number":222,"box":{"x":69,"y":850,"width":9,"height":5}},{"id":"88a9e94e-7469-42a1-a642-e67f81d38c31","block_type":"box","text":"A number of jurisdictions are consulting on adopting the standards issued to date or have already committed to","page_number":222,"box":{"x":83,"y":850,"width":795,"height":11}},{"id":"aac9b326-36d9-4f77-af2c-bd5c6e3914c7","block_type":"box","text":"doing so. BIS does not mandate any specific disclosure framework companies should use, and recognize that some","page_number":222,"box":{"x":69,"y":865,"width":826,"height":11}},{"id":"1fcbd231-b355-4386-b4d9-c9c764884a81","block_type":"box","text":"companies may report using different standards, some of which may be required by regulation. In such cases, we","page_number":222,"box":{"x":69,"y":880,"width":811,"height":11}},{"id":"833d63d0-3ebe-4323-9419-3e4dd3f399cd","block_type":"box","text":"ask that companies highlight the metrics that are industry- or company-specific. We also recognize that companies","page_number":222,"box":{"x":69,"y":895,"width":816,"height":12}},{"id":"98bb9d2b-a195-4a70-b769-8e5ef34a03be","block_type":"box","text":"may be phasing in reporting over several years. We do not prescribe timelines regarding when companies should","page_number":222,"box":{"x":69,"y":911,"width":803,"height":11}},{"id":"1df5911e-47a7-44dd-a377-a360d8f57874","block_type":"box","text":"BlackRock Investment Stewardship","page_number":222,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"e9eff41f-13c7-44e3-8bfb-fef96bc476ea","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines | 5","page_number":222,"box":{"x":509,"y":942,"width":400,"height":13}},{"id":"a454b7e5-ef00-412d-994a-53279aab0fef","block_type":"box","text":"NM0926U-5977317-222/232","page_number":222,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"4d47587d-f7e3-42c7-af1f-140d6564718e","block_type":"box","text":"(3) scope 1 and scope 2, and most significant scope 3 GHG emissions","page_number":223,"box":{"x":69,"y":45,"width":513,"height":11}},{"id":"907302d4-4053-4b51-a623-2b7ea1a95cd8","block_type":"box","text":"16, 17","page_number":223,"box":{"x":583,"y":45,"width":26,"height":5}},{"id":"4d6c75a2-337e-46b6-82d1-c3ac03270c8c","block_type":"box","text":"In addition, the dedicated team looks to","page_number":223,"box":{"x":615,"y":45,"width":283,"height":10}},{"id":"faa2c71a-1b96-4617-8d84-6ea0fe7b21b8","block_type":"box","text":"companies to disclose their emissions reduction targets for scope 1 and 2 emissions, science-based where","page_number":223,"box":{"x":101,"y":60,"width":770,"height":11}},{"id":"35bd657b-5486-48b7-8c9c-1265049d30bc","block_type":"box","text":"possible. The team welcomes disclosure of targets or indicative goals, where companies have set them, for","page_number":223,"box":{"x":102,"y":75,"width":768,"height":11}},{"id":"20088841-5f52-41ad-9a78-aa899364c314","block_type":"box","text":"scope 3 emissions reductions. Scope 3 information, including how a company is working with its value chain to","page_number":223,"box":{"x":102,"y":90,"width":792,"height":11}},{"id":"40bc810c-b74f-41ad-8f7b-8a7cbe810f84","block_type":"box","text":"accelerate reductions in GHG intensity, provides useful insight to investors focused on investing in the low","page_number":223,"box":{"x":102,"y":105,"width":760,"height":11}},{"id":"87344585-74e6-4d72-bd94-c0ae12fac084","block_type":"box","text":"carbon transition and understanding the impact of their investments on their decarbonization goals.","page_number":223,"box":{"x":101,"y":120,"width":709,"height":12}},{"id":"50cddd8c-b95c-42bf-bde8-56348e287449","block_type":"box","text":"18","page_number":223,"box":{"x":812,"y":121,"width":9,"height":4}},{"id":"c6cde599-5c1d-4d80-9085-c96601a0f2e4","block_type":"box","text":"However,","page_number":223,"box":{"x":827,"y":120,"width":62,"height":11}},{"id":"4f98874a-ac88-40d6-832f-fb0f4804bd25","block_type":"box","text":"the team recognizes that companies have varying ability to influence the emissions across the different parts of","page_number":223,"box":{"x":101,"y":135,"width":802,"height":12}},{"id":"5dbecc24-eeac-4ddc-a979-1cf97ac84715","block_type":"box","text":"their value chain and, therefore, it is helpful when disclosures explain the implications for the achievement of","page_number":223,"box":{"x":101,"y":150,"width":780,"height":11}},{"id":"8f182d3a-f9a8-47a8-8b40-c47b32064715","block_type":"box","text":"their decarbonization targets. For some companies that play an important role in the low-carbon transition, scope","page_number":223,"box":{"x":101,"y":166,"width":807,"height":11}},{"id":"755fa63f-099b-48e8-b3cb-8f9b5dc7eade","block_type":"box","text":"3 may represent their only significant source of GHG emissions in the value chain. While we do not believe","page_number":223,"box":{"x":102,"y":181,"width":759,"height":11}},{"id":"c6e274c2-3e4d-4feb-8426-0bfbb0d2e913","block_type":"box","text":"companies should be required to enforce emissions reduction targets outside of their control, where relevant, we","page_number":223,"box":{"x":101,"y":196,"width":808,"height":11}},{"id":"c3668e77-bffd-4765-a0e5-0e426392d6c5","block_type":"box","text":"look for disclosures on how the company approaches the low-carbon transition in these cases. This may include","page_number":223,"box":{"x":102,"y":211,"width":797,"height":11}},{"id":"df5834c8-ee46-41bd-887d-5f43ded15469","block_type":"box","text":"plans and targets to grow businesses that contribute to real world decarbonization, forward-looking capital or","page_number":223,"box":{"x":102,"y":226,"width":777,"height":11}},{"id":"1d451054-c695-4992-ac74-552de79543d4","block_type":"box","text":"procurement allocation plans to net-zero aligned activities or suppliers, and strategies to mitigate material","page_number":223,"box":{"x":102,"y":241,"width":755,"height":11}},{"id":"23c941c5-1835-465e-95f6-5d7e3b06737c","block_type":"box","text":"transition risks.","page_number":223,"box":{"x":101,"y":257,"width":110,"height":8}},{"id":"b44152db-9e2d-4dff-a2d1-ee6ca5d57043","block_type":"box","text":"(4) where relevant, disclosures that describe the company’s exposure to climate-related physical risks—such as","page_number":223,"box":{"x":69,"y":277,"width":808,"height":11}},{"id":"acab2e9d-f4bf-4a2c-9694-838849d1a7bb","block_type":"box","text":"acute risks from extreme weather events or chronic risks from long-term shifts in climate patterns—and how","page_number":223,"box":{"x":102,"y":292,"width":773,"height":11}},{"id":"6c8f5831-b40d-4948-bab2-0215a0b523ff","block_type":"box","text":"these risks could reasonably be expected to affect the company’s operations, assets, or supply chains.","page_number":223,"box":{"x":101,"y":307,"width":739,"height":11}},{"id":"6ac0e8b3-3c94-4ff0-b714-52f83f602f8d","block_type":"box","text":"Transition plans","page_number":223,"box":{"x":68,"y":337,"width":115,"height":11}},{"id":"67d91fff-8f02-43a3-b9d8-7c8cd8b28a35","block_type":"box","text":"Some companies have published transition plans outlining how they intend to implement their low-carbon","page_number":223,"box":{"x":102,"y":360,"width":748,"height":11}},{"id":"d501a7de-c437-4556-818e-583f86e56761","block_type":"box","text":"transition strategies. As defined by the ISSB, a transition plan “lays out the entity’s targets, actions or resources for","page_number":223,"box":{"x":68,"y":375,"width":831,"height":11}},{"id":"1008b705-ee95-48b4-bf60-0864e592da25","block_type":"box","text":"its transition towards a lower-carbon economy, including actions such as reducing its greenhouse gas emissions”","page_number":223,"box":{"x":70,"y":390,"width":805,"height":11}},{"id":"525ca86c-d76f-47c3-93c3-7b5f93114bf5","block_type":"box","text":"(see Appendix 1).","page_number":223,"box":{"x":69,"y":405,"width":122,"height":11}},{"id":"8bfd9770-d0a9-4271-a6cd-d532d202f818","block_type":"box","text":"19","page_number":223,"box":{"x":193,"y":405,"width":9,"height":5}},{"id":"864ee5d4-6d89-404b-a49f-2f912db889a9","block_type":"box","text":"Work is also underway in a number of jurisdictions on establishing a common approach in a market to corporate","page_number":223,"box":{"x":101,"y":428,"width":800,"height":11}},{"id":"23196d44-b2bb-4629-abe2-2e95707a64ce","block_type":"box","text":"transition plans.","page_number":223,"box":{"x":68,"y":443,"width":115,"height":11}},{"id":"85079a08-254b-4c07-b15e-d5cb55473a69","block_type":"box","text":"20","page_number":223,"box":{"x":184,"y":443,"width":9,"height":5}},{"id":"52e99c5c-01f1-45a9-8d20-9f30074d9218","block_type":"box","text":"Recent guidance from the ISSB on disclosures about transition plans highlights the convergence of","page_number":223,"box":{"x":200,"y":443,"width":706,"height":11}},{"id":"7f1176ec-0b1c-4788-bf7e-cbb11571c9be","block_type":"box","text":"reporting approaches.","page_number":223,"box":{"x":69,"y":458,"width":156,"height":11}},{"id":"9be3cecc-081a-4dfc-a7f5-b8e3729fb756","block_type":"box","text":"While the preparation of a transition plan, or lack thereof, is not, in itself, a voting issue, these disclosures","page_number":223,"box":{"x":101,"y":481,"width":762,"height":11}},{"id":"80558925-bf25-43db-8a1c-194c8f73b247","block_type":"box","text":"typically provide valuable insights that inform the dedicated team’s approach to engaging and voting on matters","page_number":223,"box":{"x":68,"y":496,"width":796,"height":11}},{"id":"e8a5f76d-ddfc-4d2e-92fc-77968b2a8097","block_type":"box","text":"related to climate and transition risks on behalf of in-scope funds and accounts.","page_number":223,"box":{"x":69,"y":511,"width":570,"height":11}},{"id":"3ca79b02-2d3c-49e4-9b76-d4614031bc16","block_type":"box","text":"make sustainability-related disclosures but appreciate it when companies produce them sufficiently in advance of","page_number":223,"box":{"x":69,"y":537,"width":810,"height":12}},{"id":"34a0533d-9b9a-4660-a7d9-577f0fc94e0d","block_type":"box","text":"their shareholder meeting, to the best of their abilities, to provide investors with time to assess the data and make","page_number":223,"box":{"x":68,"y":553,"width":822,"height":11}},{"id":"fd6b6007-5e0b-41f9-8ec5-5093b18e05bc","block_type":"box","text":"informed voting decisions.","page_number":223,"box":{"x":70,"y":568,"width":184,"height":11}},{"id":"b8d99670-4529-40a2-8a94-fd6d4a67c7a7","block_type":"box","text":"16","page_number":223,"box":{"x":69,"y":586,"width":9,"height":4}},{"id":"ef946945-43bd-46a9-828f-9f08280b5ba3","block_type":"box","text":"FTSE Russell address the materiality of different categories of scope 3 GHG emissions by sector in a January 2024","page_number":223,"box":{"x":84,"y":585,"width":825,"height":12}},{"id":"80b4f4f2-1436-4edb-a3b7-4013e4aec61b","block_type":"box","text":"paper: FTSE Russel, “Scope for improvement: Solving the Scope 3 conundrum,” January 2024, accessed in","page_number":223,"box":{"x":70,"y":600,"width":768,"height":12}},{"id":"3ff1f70c-5e40-4e08-85dc-9c08dec5a452","block_type":"box","text":"December 2025.","page_number":223,"box":{"x":70,"y":616,"width":118,"height":9}},{"id":"e2b3c359-e773-43c3-b8ef-095535864ae4","block_type":"box","text":"17","page_number":223,"box":{"x":69,"y":634,"width":8,"height":4}},{"id":"2ce512ec-06c9-4a22-b0db-d5a907d66dbf","block_type":"box","text":"Under this policy, the dedicated team looks for GHG emissions disclosures to be aligned with the Greenhouse Gas","page_number":223,"box":{"x":84,"y":633,"width":815,"height":12}},{"id":"018ed44e-6f44-42f9-99de-e9d013e55a01","block_type":"box","text":"Protocol (GHG Protocol). The Protocol Standards and Guidance are currently being updated to ensure they continue to","page_number":223,"box":{"x":69,"y":648,"width":838,"height":12}},{"id":"d1e89541-c2c1-4229-8c16-990bb656aba6","block_type":"box","text":"provide “a rigorous and credible accounting foundation for businesses to measure, plan and track progress toward","page_number":223,"box":{"x":70,"y":663,"width":816,"height":12}},{"id":"edad5031-7e6c-4c6a-b206-c227ec8d8938","block_type":"box","text":"science-based and net-zero targets in line with the global 1.5°C goal.” Websites accessed in December 2025.","page_number":223,"box":{"x":69,"y":679,"width":784,"height":11}},{"id":"ede8da5a-815f-4db7-b093-b31d02322f6c","block_type":"box","text":"18","page_number":223,"box":{"x":69,"y":697,"width":9,"height":4}},{"id":"f76af2b8-040c-4749-be9f-d254c2fd744e","block_type":"box","text":"The dedicated team does not believe the purpose of scope 3 disclosure requirements should be to push publicly","page_number":223,"box":{"x":83,"y":696,"width":804,"height":11}},{"id":"71f96575-8265-4ca3-9962-3674eedb6644","block_type":"box","text":"traded companies into the role of enforcing emission reduction targets outside of their control. Given methodological","page_number":223,"box":{"x":68,"y":711,"width":832,"height":12}},{"id":"93cc2b40-91f0-4b46-be68-96e288342b83","block_type":"box","text":"complexity for scope 3 emissions and the lack of direct control by companies over the requisite data, we find it most","page_number":223,"box":{"x":69,"y":726,"width":832,"height":12}},{"id":"e7e9f20a-9b20-4b16-9650-c3228d8ad38f","block_type":"box","text":"useful when companies focus their disclosures on those of the fifteen scope 3 GHG Protocol categories that are","page_number":223,"box":{"x":69,"y":742,"width":800,"height":11}},{"id":"c2e09d1c-c058-4c24-9531-fdfcab1ecb50","block_type":"box","text":"material to their business models.","page_number":223,"box":{"x":69,"y":757,"width":243,"height":9}},{"id":"5b2063d8-d767-4554-bd38-50df43c0958b","block_type":"box","text":"19","page_number":223,"box":{"x":69,"y":775,"width":9,"height":4}},{"id":"3e91bc3f-c07c-4920-afba-5eb07b851c4b","block_type":"box","text":"International Financial Reporting Standards, “IFRS S2: Climate-related Disclosures,” June 2023, accessed in","page_number":223,"box":{"x":84,"y":774,"width":777,"height":12}},{"id":"88e00a4f-62c8-4fb5-ba8b-d4d0b537bc69","block_type":"box","text":"December 2025.","page_number":223,"box":{"x":70,"y":790,"width":118,"height":8}},{"id":"fcdc1c65-9439-4bc6-8225-9196b589d071","block_type":"box","text":"20","page_number":223,"box":{"x":69,"y":807,"width":9,"height":5}},{"id":"a796478d-debc-45f7-b234-c5a8cdfdcccb","block_type":"box","text":"More companies are developing such plans, and public policymakers in certain markets are signaling their","page_number":223,"box":{"x":84,"y":807,"width":758,"height":11}},{"id":"f6c35881-015c-4f25-a87f-b38e5908ef41","block_type":"box","text":"intentions to require them or already have requirements in place, such as Australia, Brazil, and the European Union","page_number":223,"box":{"x":70,"y":822,"width":820,"height":11}},{"id":"1453c0c4-9506-4e89-a546-84c47f5f3dc3","block_type":"box","text":"(please see the International Transition Plan Network for information). BlackRock views transition plans as a method","page_number":223,"box":{"x":69,"y":837,"width":829,"height":11}},{"id":"6406b970-9f62-4605-b590-eb4dca33a45f","block_type":"box","text":"for a company to both internally assess and externally communicate its long-term strategy, ambition, objectives, and","page_number":223,"box":{"x":68,"y":852,"width":829,"height":12}},{"id":"97ebfe61-1116-4c36-9db1-1329dd399de1","block_type":"box","text":"actions to create financial value through the global transition towards a low-carbon economy. Across the landscape","page_number":223,"box":{"x":69,"y":868,"width":818,"height":11}},{"id":"ba90d198-899a-4400-81e4-61b139751667","block_type":"box","text":"there remains divergence on the objectives of such plans and the details they should contain. 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Given forthcoming regulatory requirements in certain jurisdictions, some companies are voluntarily","page_number":224,"box":{"x":101,"y":420,"width":774,"height":11}},{"id":"55f14edc-583f-4627-9d53-964eb216d0ad","block_type":"box","text":"disclosing scope 3 emissions reductions targets and plans, setting out how they are working on decarbonization","page_number":224,"box":{"x":101,"y":435,"width":800,"height":11}},{"id":"255747a1-480b-4d5d-9099-2e84a1247a40","block_type":"box","text":"with the different constituents in their value chain.","page_number":224,"box":{"x":101,"y":450,"width":358,"height":9}},{"id":"47ad4037-7685-4336-9daa-42630748e560","block_type":"box","text":"21","page_number":224,"box":{"x":461,"y":451,"width":9,"height":4}},{"id":"7ebf691f-2c0b-418a-962d-a735c529926d","block_type":"box","text":"•","page_number":224,"box":{"x":69,"y":473,"width":6,"height":5}},{"id":"f4ae181c-d516-4e92-96f2-3b25b1b93e48","block_type":"box","text":"The company’s governance and oversight processes for managing material risks associated with corporate","page_number":224,"box":{"x":101,"y":470,"width":761,"height":12}},{"id":"bc36b8db-d117-4f4b-a1c2-dccc3366efab","block_type":"box","text":"political activities including applicable policies and procedures where relevant.","page_number":224,"box":{"x":102,"y":486,"width":556,"height":11}},{"id":"eb53a62e-1197-43bd-99d0-54857a208811","block_type":"box","text":"22","page_number":224,"box":{"x":660,"y":486,"width":8,"height":4}},{"id":"5f8b98b4-e5bc-4e27-a3d2-836a19f5dd44","block_type":"box","text":"The dedicated team looks for","page_number":224,"box":{"x":674,"y":486,"width":208,"height":9}},{"id":"cb2242c1-6146-4a78-9e50-48b0a31f8ae2","block_type":"box","text":"public policy engagement to be consistent with a company’s stated strategic policy objectives, including those","page_number":224,"box":{"x":102,"y":501,"width":783,"height":11}},{"id":"ae92945a-4399-4e75-b216-63faeb76ecb7","block_type":"box","text":"related to the low-carbon transition.","page_number":224,"box":{"x":102,"y":516,"width":251,"height":9}},{"id":"7710bf7e-f0a9-47b4-8a83-40d5c107cde1","block_type":"box","text":"Voting against directors over concerns about climate risk","page_number":224,"box":{"x":68,"y":546,"width":420,"height":11}},{"id":"8f783398-ddba-48c8-81f5-de39db1b7718","block_type":"box","text":"In implementing these Guidelines, the dedicated team generally supports non-executive directors standing for","page_number":224,"box":{"x":102,"y":569,"width":781,"height":11}},{"id":"6ff4ed9f-e1aa-4fcd-96e1-7d2a1cb63779","block_type":"box","text":"election where, in its assessment based on company disclosures and engagement, a company is executing on its","page_number":224,"box":{"x":69,"y":584,"width":811,"height":11}},{"id":"809cd08c-3669-43e7-8dfe-1c796575c2b5","block_type":"box","text":"commitment to align with the transition to a low-carbon economy, as defined above. Where the dedicated team","page_number":224,"box":{"x":69,"y":599,"width":788,"height":11}},{"id":"71dbb856-35c1-48a4-89a7-f6456515026f","block_type":"box","text":"determines this is not the case, it may vote against the election of one or more directors who the team identifies as","page_number":224,"box":{"x":69,"y":614,"width":828,"height":11}},{"id":"b7537888-fe68-4303-92e8-41140f3e1b39","block_type":"box","text":"having the most responsibility for the issue. The directors most likely to be in focus are the chair of the board","page_number":224,"box":{"x":69,"y":629,"width":780,"height":11}},{"id":"f81f53bf-5bac-44ac-9a75-7d00b9fc9e07","block_type":"box","text":"committee with low-carbon transition, climate or sustainability risk oversight responsibilities, other members of the","page_number":224,"box":{"x":69,"y":644,"width":817,"height":12}},{"id":"2d4513f4-9859-4853-9c51-cf8604390e28","block_type":"box","text":"relevant committee, the lead independent director or the non-executive chair of the board. 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The research uses a definition of materiality from the GHG Protocol,","page_number":224,"box":{"x":69,"y":734,"width":813,"height":11}},{"id":"f6a1ae7c-5eb4-49a4-a628-96dd4a1ff6f0","block_type":"box","text":"which “encourages companies to maintain a representative inventory of the “most significant GHG emissions, [that]","page_number":224,"box":{"x":68,"y":749,"width":828,"height":11}},{"id":"e57a3128-a137-4ad3-a6bc-8cd3e6abb6fe","block_type":"box","text":"offer the most significant GHG reduction opportunities and are most relevant to the company’s business goals.”","page_number":224,"box":{"x":69,"y":764,"width":801,"height":12}},{"id":"775c4a01-ebdd-411f-8eb5-7ccd5ec34627","block_type":"box","text":"Website accessed in December 2025.","page_number":224,"box":{"x":68,"y":779,"width":272,"height":9}},{"id":"475be39c-dc30-467b-8fcf-bca4bdc04274","block_type":"box","text":"22","page_number":224,"box":{"x":69,"y":797,"width":9,"height":5}},{"id":"797e9132-57d0-4165-a28c-ea63ddd9953b","block_type":"box","text":"Corporate political activities may include lobbying as defined by local regulations, policy engagement (including","page_number":224,"box":{"x":84,"y":797,"width":787,"height":11}},{"id":"8b50aa80-729c-4657-bfe8-fdb0e1c77682","block_type":"box","text":"trade association memberships), and corporate political contributions.","page_number":224,"box":{"x":68,"y":812,"width":500,"height":11}},{"id":"87367fdc-994c-4dc9-90f9-44b89220edb3","block_type":"box","text":"23","page_number":224,"box":{"x":69,"y":830,"width":9,"height":5}},{"id":"497605f6-cd62-4f37-8d60-6c5840ca65b7","block_type":"box","text":"Board report votes are generally advisory and relate to reports issued by the board of directors that may contain","page_number":224,"box":{"x":84,"y":830,"width":801,"height":11}},{"id":"a1b3606c-c8e5-4191-bf1b-3ff5513d7fa6","block_type":"box","text":"information on a company’s sustainability efforts, operational resilience, or financial condition, among others.","page_number":224,"box":{"x":70,"y":845,"width":782,"height":11}},{"id":"f6e0c293-cfbd-453e-840b-d17feeedec5f","block_type":"box","text":"BlackRock Investment Stewardship","page_number":224,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"2ecb36bf-c526-4d47-8ac6-7eaf23ceb17c","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines | 7","page_number":224,"box":{"x":509,"y":942,"width":400,"height":13}},{"id":"3efc07bb-eaf7-49f6-8472-fd9cdb3f2af0","block_type":"box","text":"NM0926U-5977317-224/232","page_number":224,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"d157d332-fbd0-4785-b509-a49487e83e4c","block_type":"box","text":"Where the dedicated team has not supported director elections over climate concerns in a prior year, and the","page_number":225,"box":{"x":101,"y":45,"width":780,"height":11}},{"id":"aa271d40-f3b9-4a2d-8093-06b9d12e5d7a","block_type":"box","text":"company has not subsequently made progress towards aligning with the transition to a low-carbon economy, the team","page_number":225,"box":{"x":69,"y":60,"width":839,"height":11}},{"id":"568c1ac8-25cd-4099-8516-8e5b2864605d","block_type":"box","text":"may escalate by not supporting the re-election of additional responsible directors.","page_number":225,"box":{"x":69,"y":75,"width":582,"height":11}},{"id":"05e568cc-d984-41a6-add8-21cacffa7a1c","block_type":"box","text":"24","page_number":225,"box":{"x":653,"y":75,"width":9,"height":5}},{"id":"30e805ba-955a-437f-9a29-407be9c7afea","block_type":"box","text":"Management proposals to approve a climate strategy or progress report","page_number":225,"box":{"x":69,"y":105,"width":528,"height":11}},{"id":"bff4bbe6-3bfb-49bf-95f2-4c17143af82a","block_type":"box","text":"In certain markets, company management may submit proposals— commonly referred to as “Say on Climate” —","page_number":225,"box":{"x":102,"y":128,"width":807,"height":11}},{"id":"718f2526-5845-4335-a723-2ec43837b253","block_type":"box","text":"seeking shareholder approval of their climate action plans or progress reports. The Guidelines consider these","page_number":225,"box":{"x":69,"y":143,"width":782,"height":11}},{"id":"4ce89c7c-009f-4f60-8f22-e1590a1cd211","block_type":"box","text":"proposals as a valuable governance mechanism that can enhance transparency, accountability, and investors’","page_number":225,"box":{"x":70,"y":158,"width":782,"height":11}},{"id":"93f66bec-96c7-4387-ac39-d9061ec712f0","block_type":"box","text":"understanding of a company’s climate strategy. The dedicated team generally supports management’s climate","page_number":225,"box":{"x":69,"y":173,"width":787,"height":11}},{"id":"6499ebbd-3cda-43a7-8744-f67d9c35d3db","block_type":"box","text":"strategy proposal if, in the team’s assessment based on these Guidelines, the strategy is aligned with the low-carbon","page_number":225,"box":{"x":69,"y":188,"width":838,"height":12}},{"id":"1235f911-ecd7-4441-a87a-9d0cc966aee1","block_type":"box","text":"transition. Similarly, the dedicated team generally supports management’s proposal on a progress report if the","page_number":225,"box":{"x":68,"y":203,"width":792,"height":12}},{"id":"e9a2b7c6-8dd7-4497-8463-643c6eda2157","block_type":"box","text":"company has clearly explained its progress against, and any deviations from or changes to, its stated low-carbon","page_number":225,"box":{"x":69,"y":218,"width":803,"height":12}},{"id":"4918e074-a259-43f5-9023-da835bd7bdb2","block_type":"box","text":"transition plan and targets.","page_number":225,"box":{"x":68,"y":234,"width":193,"height":11}},{"id":"142c47a9-1598-4bd1-9c12-72b426a90764","block_type":"box","text":"Shareholder proposals on climate and low-carbon transition matters","page_number":225,"box":{"x":68,"y":264,"width":495,"height":11}},{"id":"1a37aa43-e9e7-48dc-a879-b0b2773ca37b","block_type":"box","text":"In most markets, shareholders can submit proposals to be voted on at a company’s shareholder meeting, as","page_number":225,"box":{"x":102,"y":287,"width":777,"height":11}},{"id":"36d29ffe-68a0-4483-a016-bebdc61bba8d","block_type":"box","text":"long as certain requirements are met. Shareholder proposals span a wide range of topics and have varying degrees","page_number":225,"box":{"x":70,"y":302,"width":824,"height":11}},{"id":"523bf1ec-db46-4419-8f5a-b51b25fea5f8","block_type":"box","text":"of relevance for companies across sectors, locations, and business models.","page_number":225,"box":{"x":69,"y":317,"width":543,"height":11}},{"id":"5588f0a7-76a8-49a3-971c-0d5caa02f01f","block_type":"box","text":"Each shareholder proposal is evaluated on a case-by-case basis, focusing on its merit while considering the","page_number":225,"box":{"x":102,"y":339,"width":767,"height":12}},{"id":"7fe9c546-619b-491e-ad5c-ba998bb5c285","block_type":"box","text":"company’s individual circumstances. When the dedicated team votes in support of a proposal, it is not necessarily","page_number":225,"box":{"x":69,"y":355,"width":818,"height":11}},{"id":"9bada4c2-1716-46c4-b2c1-60c8102db394","block_type":"box","text":"endorsing every element of the proposal or the reasoning, objectives, or supporting statement of the proponent.","page_number":225,"box":{"x":69,"y":370,"width":800,"height":11}},{"id":"20389b7c-3a80-40d1-b6af-efd1d89c71ed","block_type":"box","text":"In addition to financial materiality, the Guidelines consider the proposal’s relevance to the company’s low-carbon","page_number":225,"box":{"x":102,"y":392,"width":802,"height":12}},{"id":"a827eef6-a702-442f-816b-a8cef738fcae","block_type":"box","text":"transition strategy and targets. The dedicated team assesses the implications for, and the relevance to, the","page_number":225,"box":{"x":68,"y":407,"width":770,"height":12}},{"id":"7f4c059e-393f-4d4a-9d37-8735323ba4d1","block_type":"box","text":"company’s stated low-carbon transition strategy and targets. Under the Guidelines, the team may support","page_number":225,"box":{"x":69,"y":423,"width":754,"height":11}},{"id":"269b2a47-db20-4c94-8f9b-b798cc0f42e7","block_type":"box","text":"shareholder proposals that, for example, ask a company to:","page_number":225,"box":{"x":69,"y":438,"width":425,"height":11}},{"id":"0315161d-6cd7-42e4-9bef-b3cf859cc9c9","block_type":"box","text":"•","page_number":225,"box":{"x":69,"y":461,"width":6,"height":4}},{"id":"5e8d1b5a-a527-4708-b265-603c84d61992","block_type":"box","text":"Publish a business plan, and related disclosures, consistent with the ambition to limit average global","page_number":225,"box":{"x":102,"y":458,"width":719,"height":11}},{"id":"e855c467-c273-47ca-8fb3-a55ad52eef8d","block_type":"box","text":"temperature rise to no more than 1.5°C above pre-industrial levels","page_number":225,"box":{"x":101,"y":473,"width":474,"height":11}},{"id":"4fde2a0f-ce55-40db-8666-c1bb5b6c2960","block_type":"box","text":"•","page_number":225,"box":{"x":69,"y":496,"width":6,"height":5}},{"id":"16f27d2f-dad3-4ff6-95b8-a707258d077c","block_type":"box","text":"Align scope 1 and 2 GHG emissions reduction targets to, and/or discuss how their targets align with, a long-term","page_number":225,"box":{"x":101,"y":493,"width":807,"height":11}},{"id":"26611be5-64f6-4175-bd32-077ecb97d923","block_type":"box","text":"goal of the company achieving net zero GHG emissions by 2050","page_number":225,"box":{"x":101,"y":508,"width":457,"height":12}},{"id":"6795a439-0c2d-4ca6-9999-c00aa3c05ed4","block_type":"box","text":"•","page_number":225,"box":{"x":69,"y":531,"width":6,"height":5}},{"id":"75b7a708-dab1-4d87-9290-9d0f4e410af5","block_type":"box","text":"Disclose the categories of scope 3 GHG emissions most significant to a company’s business model","page_number":225,"box":{"x":102,"y":528,"width":712,"height":12}},{"id":"b5f4ccc4-bf1c-428f-9759-c1e5dc97a897","block_type":"box","text":"•","page_number":225,"box":{"x":69,"y":551,"width":6,"height":5}},{"id":"bd0f06fa-3290-40e8-9e59-d50acaf57450","block_type":"box","text":"Improve voluntary disclosures on the alignment of a company’s climate-related corporate political activities with","page_number":225,"box":{"x":102,"y":549,"width":794,"height":11}},{"id":"24dc0237-a6a1-4789-8ade-d71bdc2dd1e7","block_type":"box","text":"its strategic policy positions, where existing disclosure is insufficient","page_number":225,"box":{"x":102,"y":564,"width":489,"height":11}},{"id":"0f887be8-6d0e-4d91-9244-716f1fceb091","block_type":"box","text":"25","page_number":225,"box":{"x":592,"y":564,"width":9,"height":5}},{"id":"1627da62-3cb6-43fc-ab93-27b9b9153a7a","block_type":"box","text":"The dedicated team does not support shareholder proposals that seek to constrain board or management","page_number":225,"box":{"x":101,"y":587,"width":758,"height":11}},{"id":"bf1ded95-a5cd-487b-8676-b18a02e39ce4","block_type":"box","text":"decision-making or direct specific business or strategic decisions.","page_number":225,"box":{"x":69,"y":601,"width":468,"height":12}},{"id":"ba5691de-f99e-4000-b011-d48c7910fc26","block_type":"box","text":"RELATED MATTERS","page_number":225,"box":{"x":419,"y":632,"width":140,"height":9}},{"id":"e6055dc8-48e9-4faa-97e1-775eb2bc1b64","block_type":"box","text":"There are other business items not covered above that may be put to a shareholder vote that could address","page_number":225,"box":{"x":101,"y":655,"width":771,"height":11}},{"id":"39688db9-2b7f-4e98-9dab-ffefa26f1a7d","block_type":"box","text":"matters relevant to the transition to a low-carbon economy. 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Generally, voting on these matters would","page_number":225,"box":{"x":68,"y":685,"width":831,"height":11}},{"id":"d809590e-6bd3-4d4f-b17d-ce48f5ba20c1","block_type":"box","text":"be covered by BIS’ Benchmark Policies.","page_number":225,"box":{"x":69,"y":700,"width":280,"height":11}},{"id":"90f993de-724f-46c5-b223-7acbab32f629","block_type":"box","text":"Executive compensation","page_number":225,"box":{"x":69,"y":730,"width":177,"height":11}},{"id":"10ef39a3-7b14-4c6a-9194-840deb9a62b8","block_type":"box","text":"The dedicated team looks to company boards to put in place a compensation structure that incentivizes and","page_number":225,"box":{"x":101,"y":753,"width":772,"height":11}},{"id":"3924a21d-ffb9-46b5-9b4f-e2446f1c00bc","block_type":"box","text":"rewards executives appropriately. Some companies, in light of their long-term strategy, may decide to include relevant","page_number":225,"box":{"x":69,"y":768,"width":837,"height":11}},{"id":"8a0f1e4d-4a4f-485c-af51-1d856993879d","block_type":"box","text":"GHG emissions reduction targets or low-carbon transition-related metrics in their incentive plans. In such cases, the","page_number":225,"box":{"x":69,"y":783,"width":826,"height":11}},{"id":"9ceb3f3e-f13f-485d-a969-bd230d7b210f","block_type":"box","text":"dedicated team would engage to understand the alignment between those metrics and the company’s stated climate","page_number":225,"box":{"x":69,"y":798,"width":834,"height":11}},{"id":"b848bda0-8269-4ae0-9de2-6feeb304b596","block_type":"box","text":"24","page_number":225,"box":{"x":69,"y":828,"width":9,"height":4}},{"id":"35b0dd80-4b90-4835-a2f6-688c87d5339d","block_type":"box","text":"While the dedicated team may escalate voting by not supporting additional management proposals, principally","page_number":225,"box":{"x":83,"y":827,"width":787,"height":12}},{"id":"4e203f4a-d6ec-42a5-9b90-9d23003f5bfe","block_type":"box","text":"director elections, the team does not consider filing shareholder proposals, preannouncing voting intentions or using","page_number":225,"box":{"x":69,"y":842,"width":832,"height":12}},{"id":"14174c15-022d-458f-acbe-ece4fda22201","block_type":"box","text":"the media to amplify concerns as appropriate courses of action. The dedicated team will continue to take a","page_number":225,"box":{"x":68,"y":857,"width":765,"height":12}},{"id":"551d7aa4-6559-44ff-978c-93035d83d227","block_type":"box","text":"constructive, long-term focused approach, to engagement and voting on behalf of clients under these Guidelines.","page_number":225,"box":{"x":69,"y":873,"width":805,"height":11}},{"id":"f2482139-3cb0-45e9-8076-b4a414ade36b","block_type":"box","text":"25","page_number":225,"box":{"x":69,"y":891,"width":9,"height":4}},{"id":"bcaf025e-c727-473d-af10-e7ec87c66fa8","block_type":"box","text":"Corporate political activities may include lobbying as defined by local regulations, policy engagement (including","page_number":225,"box":{"x":84,"y":890,"width":787,"height":12}},{"id":"6d790388-38ee-44b7-a6e1-d679bf14dacc","block_type":"box","text":"trade association memberships), and corporate political contributions.","page_number":225,"box":{"x":68,"y":906,"width":500,"height":10}},{"id":"b5f2c84f-81d8-49b6-90cf-15d319d64630","block_type":"box","text":"BlackRock Investment Stewardship","page_number":225,"box":{"x":69,"y":943,"width":260,"height":11}},{"id":"01ef4b9c-1161-450f-8067-9bc4aa372414","block_type":"box","text":"Climate and Decarbonization Stewardship Guidelines | 8","page_number":225,"box":{"x":509,"y":942,"width":400,"height":13}},{"id":"52897141-d2e9-4653-9b3b-88b3551e005b","block_type":"box","text":"NM0926U-5977317-225/232","page_number":225,"box":{"x":764,"y":970,"width":154,"height":7}},{"id":"8d497112-e5e0-40d9-8ca4-4d2c91bdbbf3","block_type":"box","text":"strategy. Clear disclosure also helps investors assess whether pay structures are consistent with long-term climate","page_number":226,"box":{"x":69,"y":45,"width":821,"height":11}},{"id":"d204c0af-58e7-46dd-96a4-b0dc7a2ce622","block_type":"box","text":"strategy and risk management.","page_number":226,"box":{"x":69,"y":60,"width":219,"height":11}},{"id":"88b617f4-897e-4893-8923-00129fd8ef02","block_type":"box","text":"Auditors and audit-related issues","page_number":226,"box":{"x":68,"y":90,"width":240,"height":9}},{"id":"21093c19-353b-479c-98bc-47662dce95aa","block_type":"box","text":"For companies with material climate or transition risks or opportunities in their business models, the dedicated","page_number":226,"box":{"x":102,"y":113,"width":793,"height":11}},{"id":"3785ebec-19e9-4d4e-8285-b18198d74be4","block_type":"box","text":"team is interested in understanding whether the company considers and, if relevant, quantifies, and accounts for","page_number":226,"box":{"x":68,"y":128,"width":807,"height":11}},{"id":"da0d0f5d-0041-4c72-9e0b-57b45828b438","block_type":"box","text":"material climate-related risks in its financial statements, including if the company explains such risks within the","page_number":226,"box":{"x":69,"y":143,"width":794,"height":11}},{"id":"5896da64-402b-4a81-a9f6-7504618c7765","block_type":"box","text":"context of its audit report. 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These include a company’s impacts or dependencies on natural capital and key","page_number":226,"box":{"x":68,"y":355,"width":734,"height":11}},{"id":"0c9e1644-64ef-4692-affc-b7c65e329f92","block_type":"box","text":"stakeholders.","page_number":226,"box":{"x":69,"y":370,"width":95,"height":9}},{"id":"7913a95e-34d0-477c-82cd-4dbf2cc9e631","block_type":"box","text":"26","page_number":226,"box":{"x":166,"y":370,"width":9,"height":5}},{"id":"d3dfca06-a6c2-4d9e-9f4e-f1481bde1468","block_type":"box","text":"In the context of these Guidelines, the dedicated team may engage companies to better understand","page_number":226,"box":{"x":182,"y":370,"width":710,"height":11}},{"id":"56439a85-5608-4a9a-94c5-01e0e3f32657","block_type":"box","text":"how they are managing the impact on people (e.g., employees, suppliers, customers and communities) of any","page_number":226,"box":{"x":69,"y":385,"width":783,"height":11}},{"id":"b3e1b7c3-4775-4c80-8701-6c756848bf98","block_type":"box","text":"strategic or operational changes they are making in relation to their transition to a low-carbon economy. 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The economic transformation is being driven by changes in","page_number":227,"box":{"x":69,"y":188,"width":811,"height":12}},{"id":"de2a7af1-4a0f-41da-ae23-3ab31b399fff","block_type":"box","text":"government policy, technology, and consumer and investor preferences, as well as the physical effects of climate","page_number":227,"box":{"x":68,"y":203,"width":807,"height":12}},{"id":"428dacde-d537-44dd-b584-e05421a6c96f","block_type":"box","text":"change (e.g., extreme weather), and can potentially have a material impact on clients’ investments and portfolios.","page_number":227,"box":{"x":69,"y":218,"width":812,"height":12}},{"id":"37f0e80c-d543-45e5-8dd6-f5bd793958a9","block_type":"box","text":"Decarbonization:","page_number":227,"box":{"x":102,"y":241,"width":120,"height":9}},{"id":"8f311d4e-16ff-46d5-876e-adb1858d3639","block_type":"box","text":"the process of reducing or eliminating emissions of carbon dioxide (CO2) from human activity","page_number":227,"box":{"x":228,"y":241,"width":664,"height":11}},{"id":"81e23dde-aac4-4adf-8cf9-e8aa8136f716","block_type":"box","text":"and removing carbon currently in the atmosphere. This can be carried out by countries, companies and even","page_number":227,"box":{"x":69,"y":257,"width":771,"height":11}},{"id":"3b697aca-efd7-4d36-8fc6-f50ade0ad3cc","block_type":"box","text":"individual consumers. Sometimes the concept is understood to include the reduction and elimination of other GHG,","page_number":227,"box":{"x":70,"y":271,"width":820,"height":11}},{"id":"f625b292-48e2-4a9d-91a6-5708d12cc911","block_type":"box","text":"e.g., methane.","page_number":227,"box":{"x":69,"y":287,"width":102,"height":11}},{"id":"e128f10c-ae4b-4cb9-9184-fad886388601","block_type":"box","text":"Climate-related risks and opportunities:","page_number":227,"box":{"x":101,"y":309,"width":289,"height":11}},{"id":"789721a9-2b1a-4b2e-8c00-1d8e142ac010","block_type":"box","text":"The investment opportunities and risks associated with the transition","page_number":227,"box":{"x":396,"y":309,"width":495,"height":11}},{"id":"d6d573e0-cb4e-4424-83af-40d6a848d7b2","block_type":"box","text":"to a low-carbon economy, including transition risks and opportunities and physical risks and opportunities in adapting","page_number":227,"box":{"x":68,"y":325,"width":838,"height":11}},{"id":"83b86a8f-7a5f-4bef-b648-658971352fa6","block_type":"box","text":"to physical climate change.","page_number":227,"box":{"x":68,"y":340,"width":193,"height":11}},{"id":"ba65f6cb-9c3e-4678-ac0b-b7396164135c","block_type":"box","text":"Climate-related transition plan:","page_number":227,"box":{"x":101,"y":362,"width":226,"height":11}},{"id":"ef431f3f-3afd-414f-be00-1b3526c01946","block_type":"box","text":"“An aspect of an entity’s overall strategy that lays out the entity’s targets,","page_number":227,"box":{"x":334,"y":362,"width":525,"height":11}},{"id":"f61c7415-ec99-4b0d-befd-16cbdb8fa076","block_type":"box","text":"actions or resources for its transition towards a lower-carbon economy, including actions such as reducing its","page_number":227,"box":{"x":69,"y":377,"width":778,"height":12}},{"id":"ebe7d2b2-428d-4d20-8a65-a1ce4075e871","block_type":"box","text":"greenhouse gas emissions.”","page_number":227,"box":{"x":68,"y":393,"width":203,"height":11}},{"id":"e60d7a3a-74b5-444e-8b73-24f5521a0187","block_type":"box","text":"27","page_number":227,"box":{"x":273,"y":393,"width":9,"height":4}},{"id":"6a20c13d-1318-4858-93cb-5461ec38f54b","block_type":"box","text":"Science-based GHG emissions reduction targets:","page_number":227,"box":{"x":101,"y":415,"width":356,"height":11}},{"id":"d1966280-666a-4dd2-83bc-d4f48bc3d2fb","block_type":"box","text":"Targets that “","page_number":227,"box":{"x":463,"y":415,"width":96,"height":11}},{"id":"68891420-75e9-40e0-83f7-f95cc04066ae","block_type":"box","text":"are in line with what the latest climate science","page_number":227,"box":{"x":569,"y":415,"width":331,"height":9}},{"id":"5b1b9aab-5cf9-4026-8aa2-13b19a6775e9","block_type":"box","text":"deems necessary to meet the goals of the Paris Agreement — limiting global warming to 1.5°C above pre-industrial","page_number":227,"box":{"x":69,"y":430,"width":822,"height":11}},{"id":"9cb9278c-4c80-4c71-b7c1-13770548500a","block_type":"box","text":"levels. 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[It] is defined as electricity [steam,","page_number":227,"box":{"x":70,"y":566,"width":807,"height":11}},{"id":"c94a76c6-006b-4bbb-ad6a-1e39dcb1c965","block_type":"box","text":"and heating/cooling] that is purchased or otherwise brought into the organizational boundary of the company.","page_number":227,"box":{"x":69,"y":581,"width":781,"height":12}},{"id":"7e15950e-e58f-420a-a689-123b0d7a25e6","block_type":"box","text":"30","page_number":227,"box":{"x":852,"y":582,"width":9,"height":4}},{"id":"c4ed517a-a1ca-4d3f-8b94-325bbf082a90","block_type":"box","text":"Scope 3:","page_number":227,"box":{"x":101,"y":604,"width":63,"height":11}},{"id":"7cdf91fa-2677-48d4-9930-5d679f399c23","block_type":"box","text":"Other indirect GHG emissions. Scope 3 is an optional reporting category that allows for the treatment","page_number":227,"box":{"x":171,"y":604,"width":725,"height":11}},{"id":"57a186b0-2ab7-4974-8c02-8ed6103f8e59","block_type":"box","text":"of all other indirect emissions. 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